Floyer-Acland & Ors v Osmond

A contractual power to resume part of an agricultural holding for any non-agricultural purpose is not limited by purposes achievable under a separate reservation of mines and minerals, nor must the purpose permanently remove the land from agriculture. Restoration and aftercare do not constitute agricultural use where they are merely preliminary to mineral extraction.

For Case B under the Agricultural Holdings Act 1986, “use” is not confined to the planning-law concept excluding operations. Mineral extraction may constitute a use for which planning permission has been granted. The landlord must genuinely require possession for that use; an objective test of necessity is not imposed.

The landlords of an agricultural holding served a notice to quit part of the holding, relying on a contractual resumption clause and Case B in Schedule 3 to the Agricultural Holdings Act 1986. The notice related to land intended for sand and gravel extraction under planning permission, followed by restoration to agriculture.

The tenant challenged the notice. An arbitrator stated a special case for the Weymouth County Court. The recorder held that the contractual clause applied but that Case B did not, because mineral extraction was not a planning-law “use”. Both parties appealed on different issues concerning the interaction between the contractual rights, the statutory scheme and the proposed agricultural restoration.

1. Disposition. Lord Justice Morritt allowed the landlords’ appeal and dismissed the tenant’s cross-appeal. Lord Justice Schiemann agreed. The notice was valid under both clause 43 and Case B. The formal order recorded the appeal as refused, but the approved reasoning and operative judgment stated that the appeal was allowed.
2. Clause 43. The words “any purpose or purposes” were given their ordinary breadth. The contractual power was not restricted to purposes incapable of being achieved through the reservation of mines and minerals in clause 3(3). The two rights had different limitations and consequences.
3. The purpose for resuming possession did not have to remove the land permanently from agriculture. Where a landlord has concurrent purposes, an agricultural use may prevent reliance on clause 43. That did not occur here: the purpose was mineral extraction. Restoration and aftercare were preliminary and conditional works, not the purpose for which possession was sought.
4. Case B. “Required” meant that the landlords genuinely wished to regain possession for the permitted use. The cases concerning that expression in other statutory contexts were relevant drafting indications, but did not impose an objective test of necessity. Possession was required for the planning-permitted extraction and associated restoration programme, which went beyond the rights under clause 3(3).
5. The planning-law meaning of “use” in section 336 of the Town and Country Planning Act 1990 was not imported into Case B. Such a construction would exclude building and mining operations and make other provisions of the statutory scheme ineffective. Mineral extraction therefore fell within Case B.
6. Case B could accommodate more than one use, but neither extraction nor restoration and aftercare was an agricultural use. Questions (a) to (c) in the special case were answered affirmatively insofar as they concerned Case B. Permission to appeal to the House of Lords was refused.

• Court of Appeal (Civil Division): allowed the landlords’ appeal and dismissed the tenant’s cross-appeal from the Weymouth County Court decision of 11 February 1999.
• Weymouth County Court: on a special case stated by the arbitrator, held that the notice was valid under clause 43 but that Case B did not apply.