by Emma Jordan, Trainee Solicitor

The Scottish Land Court has declined to accept that a tenant withholding their rent due to the landlord’s failure to fulfil their obligations under a lease is a valid defence to an irritancy notice on the ground that the tenant could have applied to the Land Court for protection in such circumstances.

The facts

This case was an application by a landlord to uphold an irritancy notice served in accordance with the terms of a limited duration tenancy between the trustees of the Gannochy Trust and Messrs J & K Steel. 

The lease contained an irritancy clause which allowed the landlord to put an end to the lease so long as they gave the tenant not less than two months’ prior written notice in the event of the tenant ‘allowing any part of the rent to remain unpaid for 14 days after it has become due for payment in terms of this Lease’. 

Gannochy Trust served notice on 29 May 2018 calling for payment of arrears of rent of £12,260 to be paid by 31 July 2018. Certain payments were made however the arrears had not been cleared by the required date. Gannochy Trust therefore served a further notice on 15 August 2018 notifying the tenants of termination of the lease. Despite such notice, Steel refused to vacate on two grounds: 

  1. They claimed that Gannochy Trust had put improper pressure on them to carry out repairs which they argued should have fallen under the responsibility of the landlord.
  2. They contended that the level of rent had been too high and that Gannochy Trust had continuously refused to let them operate a micro-dairy.

Decision

The Land Court held that neither of these grounds constituted a valid defence to the irritancy notice. Had it been the case that the respondents were withholding rent due to Gannochy Trust’s failure to fulfil their obligations, they could have applied to the court for an order requiring Gannochy Trust to fulfil their obligations under section 84(1)(b) of the Agricultural Holdings (Scotland) Act 2003. If Gannochy Trust had continued to default, Steel could then have looked to s 12 of that Act (right of tenant to withhold rent) for protection. The Land Court decided that the above were not contributing factors to the unpaid rent but instead that the rent had not been paid due to the sole fact that tenants could not afford it.

In granting their order, the Land Court noted that in a case involving the removal of a tenant from an agricultural lease, the practicalities of the removal and welfare of stock always require to be considered, and stated that a month is a reasonable period to allow for that purpose.

 

Further help

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