Agricultural Tenancies Act 1995

20 (1) Schedule 7 to that Act (adjustments between landlords and tenants and in respect of mortgages and mining leases and orders) shall be amended as follows.

(2) After paragraph 1, there shall be inserted—

“1A (1) The provisions of this paragraph shall have effect where—

(a) paragraphs (a) and (b) of subsection (1) of section 25A of this Act apply, and

(b) the farm business tenancy at the end of which the tenant could have claimed compensation for tenant’s improvements terminates on or after the date of entry, but before the end of the period of occupation, without being succeeded by another such subsequent tenancy.

(2) In the circumstances specified in sub-paragraph (1) of this paragraph, the provisions of Part III of the Act of 1995—

(a) shall apply, in relation to the tenancy mentioned in that sub-paragraph, as if, at the termination of that tenancy, the land in question were in the state in which it was immediately before the date of entry, and

(b) if the tenant under that tenancy quitted the holding before the termination of his tenancy, shall so apply as if he had quitted the holding on the termination of his tenancy.

(3) In sub-paragraph (2) of this paragraph, “holding”, in relation to a farm business tenancy, and “termination”, in relation to a tenancy, have the same meaning as in the Act of 1995.”

(3) In paragraph 2, in sub-paragraph (1), after “agricultural holding” there shall be inserted “held under a tenancy in relation to which the Act of 1986 applies”.

(4) After that paragraph there shall be inserted—

“2A (1) The provisions of this paragraph shall have effect where land comprised in a farm business tenancy is comprised in a compulsory rights order (whether any other land is comprised in the holding, or comprised in the order, or not), and—

(a) before the date of entry there had been provided in relation to the land in question tenant’s improvements (in this paragraph referred to as “the former tenant”s improvements') in respect of which, immediately before that date, the tenant had a prospective right to compensation under section 16 of the Act of 1995 on quitting the holding on the termination of the tenancy, and

(b) at the end of the period of occupation the circumstances are such that Part III of that Act would have applied as mentioned in subsections (3) and (4) of section 25A of this Act, but for the fact that the benefit of the former tenant’s improvements has been replaced, on the restoration of the land, by other improvements (in this paragraph referred to as “the new improvements”) of comparable benefit to the land.

(2) In the circumstances specified in sub-paragraph (1) of this paragraph, Part III of the Act of 1995 shall have effect in relation to the new improvements as if those improvements were tenant’s improvements.

(3) Subsections (2) and (6) of section 25A of this Act shall apply for the purposes of this paragraph as they apply for the purposes of that section.”

(5) After paragraph 3 there shall be inserted—

“3A Where by virtue of section 25A of this Act a tenant is entitled to compensation for tenant’s improvements as mentioned in that section and—

(a) after the end of the period of occupation expenses are incurred in replacing the benefit of the tenant’s improvements by other improvements of comparable benefit to the land, and

(b) the person incurring those expenses (whether he is the landlord or not) is entitled to compensation in respect of those expenses under section 22 of this Act,

section 13 of the Act of 1995 shall apply as if the works in respect of which those expenses are incurred were not tenant’s improvements, if apart from this paragraph they would constitute such improvements.”

(6) At the end of paragraph 4, there shall be added—

“(7) In this paragraph “agricultural holding” does not include an agricultural holding held under a farm business tenancy.”

(7) After that paragraph there shall be inserted—

“4A (1) The provisions of this paragraph shall apply where—

(a) immediately before the operative date of a compulsory rights order, any of the land comprised in the order is subject to a farm business tenancy, and

(b) that tenancy continues until after the end of the period of occupation.

(2) The landlord or tenant under the tenancy may, by notice in writing served on his tenant or landlord, demand a reference to arbitration of the question whether any of the terms and conditions of the tenancy (including any term or condition relating to rent) should be varied in consequence of any change in the state of the land resulting from the occupation or use of the land in the exercise of rights conferred by the order; and subsection (3) of section 28 of the Act of 1995 shall apply in relation to a notice under this sub-paragraph as it applies in relation to a notice under subsection (2) of that section.

(3) On a reference by virtue of this paragraph, the arbitrator shall determine what variations (if any) should be made in the terms and conditions of the tenancy, and the date (not being earlier than the end of the period of occupation) from which any such variations are to take effect or to be treated as having taken effect; and as from that date the tenancy shall have effect, or, as the case may be, shall be treated as having had effect, subject to any variations determined by the arbitrator under this paragraph.

(4) The provisions of this paragraph shall not affect any right of the landlord or the tenant, or the jurisdiction of the arbitrator, under Part II of the Act of 1995; but where—

(a) there is a reference by virtue of this paragraph and a reference under Part II of that Act in respect of the same tenancy, and

(b) it appears to the arbitrator that the reference under Part II of that Act relates wholly or mainly to the consequences of the occupation or use of the land in the exercise of rights conferred by the order,

he may direct that proceedings on the two references shall be taken concurrently.”

(8) In paragraph 5(1), after “agricultural holding” there shall be inserted “held under a tenancy in relation to which the Act of 1986 applies”.

(9) In paragraph 6—

(a) in sub-paragraph (1), for “an agricultural holding” there shall be substituted “—

(a) an agricultural holding held under a tenancy in relation to which the Act of 1986 applies, or

(b) a holding under a farm business tenancy,”; and

(b) after sub-paragraph (2) there shall be added—

“(2A) In sub-paragraph (1) of this paragraph, “holding”, in relation to a farm business tenancy, has the same meaning as in the Act of 1995.”

(10) In paragraph 7—

(a) after “The provisions of” there shall be inserted “sub-paragraphs (1) to (6) of”;

(b) for “that paragraph” there shall be substituted “those sub-paragraphs”; and

(c) after “subject to a mortgage” there shall be inserted “but not comprised in a farm business tenancy”.

(11) After that paragraph there shall be inserted—

“7A The provisions of paragraph 4A of this Schedule shall apply in relation to mortgages of land comprised in farm business tenancies as they apply in relation to such tenancies, as if any reference in that paragraph to such a tenancy were a reference to such a mortgage, and any reference to a landlord or to a tenant were a reference to a mortgagee or to a mortgagor, as the case may be.”

(12) In paragraph 12(1)(a), for the words from “did” to “holding” there shall be substituted “was not comprised in a tenancy in relation to which the Act of 1986 applies or in a farm business tenancy”.

(13) In paragraph 13, after “or to a tenancy” there shall be inserted “(other than a reference to a tenancy in relation to which the Act of 1986 applies or a farm business tenancy)”.

(14) In paragraph 25—

(a) in sub-paragraph (a), at the beginning there shall be inserted “subject to sub-paragraphs (ba), (bc), (bd)(i) and (be) of this paragraph,”;

(b) after sub-paragraph (b), there shall be inserted—

“(ba) in sub-paragraph (1) of paragraph 2, the words “held under a tenancy in relation to which the Act of 1986 applies” shall be omitted;

(bb) sub-paragraph (7) of paragraph 4 shall be omitted;

(bc) in sub-paragraph (1) of paragraph 5, the words “held under a tenancy in relation to which the Act of 1986 applies” shall be omitted;

(bd) in paragraph (6)—

(i) for paragraphs (a) and (b) of sub-paragraph (1) there shall be substituted the words “an agricultural holding”; and

(ii) sub-paragraph (2A) shall be omitted;

(be) in sub-paragraph (1)(a) of paragraph 12, for the words “was not comprised in a tenancy in relation to which the Act of 1986 applies or in a farm business tenancy” there shall be substituted the words “did not constitute or form part of an agricultural holding”;” and

(c) in sub-paragraph (c), for “7” there shall be substituted “1A, 2A, 3A, 4A, 7, 7A”.