Tenancy Agreements

As a landlord, it is important to consider the wording of tenancy agreements.

The wording in clauses can significantly impact your rights and property if not drafted correctly. The recent case of Rees v Earl of Plymouth [2020] provides an interesting insight into how the wording of certain clauses will potentially impact farms and any potential development that may be planned.

In this case, the tenant farmer (J Rees) farmed in partnership with P Rees. J Rees had two tenancy agreements:

• a 1965 tenancy which contained a clause that said the landlord could enter “at all reasonable times for all reasonable purposes”
• a later tenancy in 1986 which contained a further clause that said that the landlord could enter the land at any time “for the purpose of inspecting…or for any other purpose connected with his estate”.

The landlord had obtained planning permission for housing development and required access to the property for numerous surveys in connection with the development. J Rees consented initially for a compensation payment – a practice common when developing land. The landlord then required further surveys which J Rees subsequently refused. J Rees brought an action to prevent further access by the landlord and also to prevent the landlord from leaving testing equipment on the farm.

The Court agreed with J Rees’ arguments that there first should be a strict interpretation of the clauses in the tenancy agreements to prevent additional rights being granted to the landlord; secondly, Rees stated that if two meanings can be drawn from a clause then it should be the least restrictive meaning for the tenant.

This case is important for landlords as it supported entry to the property for the purpose of carrying out surveys. The landlord had the right to gain access for reasonable purposes, and the Court held it could do what was deemed reasonably necessary under the terms of the tenancy, including leaving equipment on the property.

But the judgment did narrow the definition of ‘surveys’ to exclude intrusive activities, such as making boreholes, so this would be something to consider getting under express wording when planning surveys before development. Also, on the wording here the permissible activities did not extend to those which cause damage to the land or involve cordoning off parts of the land or significant interference with the operation of the working farm, as the court upheld the age-old principle of a tenant’s right to quiet enjoyment. If intrusive activities were envisaged, the tenancy agreement should have mentioned the need to minimise disruption. Therefore, if the intention is to permit specific activities to prepare for development which is not mentioned in the tenancy agreement, where those would tend to interfere with possession or quiet enjoyment you would have expected that to have been stated rather than left for inference.

It is therefore vital to review all tenancy agreements where a landowner hopes to get development at some point.

The judgement also said that if the permitted activities were liable to cause damage, the tenancy agreement would probably have provided for the possibility of compensation. Compensation is a useful tool in development as it can help to move things along, so look for these clauses or get a specialist to review the tenancy for you.

If you are a landlord looking to develop your property, it is important to consider the case of Rees as the wording of a tenancy agreement can affect how your development progresses.

We Can Help You

Getting the right legal advice will give you peace of mind when developing land, and our specialist Agriculture and Estates team can help. Our team has comprehensive specialist knowledge of farm tenancies and development.

For specific advice for your business, please get in contact with us on 0330 404 0777 or email enquiry@ashtonslegal.co.uk.