Agriculture Act 1986

7(1)For the purposes of this Schedule “the tenant’s fraction” means the fraction of which—E+W+S

(a)the numerator is the annual rental value at the end of the relevant period of the tenant’s dairy improvements and fixed equipment; and

(b)the denominator is the sum of that value and such part of the rent payable by the tenant in respect of the relevant period as is attributable to the land used in that period for the feeding, accommodation or milking of dairy cows kept on the tenancy.

(2)For the purposes of sub-paragraph (1)(a) above, in the case of an agricultural holding within the meaning of [F1the 1991 Act], the annual rental value of the tenant’s dairy improvements and fixed equipment shall be taken to be the amount which would be disregarded, on a reference to [F2 the Scottish Land Court ] made in respect of the tenancy under [F1section 13 of the 1991 Act] (variation of rent), as being—

(a)an increase in annual rental value due to dairy improvements at the tenant’s expense (in terms of subsection (2)(a) of that section); or

(b)the value of tenant’s fixed equipment and therefore not relevant to the fixing of rent under that section,

so far as that amount is attributable to tenant’s dairy improvements and fixed equipment which are relevant to the feeding, accommodation or milking of dairy cows kept on the tenancy.

(3)Where—

(a)the relevant period is less than or greater than 12 months; or

(b)rent was payable by the tenant in respect of only part of the relevant period,

the average rent payable in respect of one month in the relevant period or, as the case may be, in that part shall be determined and the rent referred to in sub-paragraph (1)(b) above shall be taken to be the corresponding annual amount.

(4)For the purposes of this paragraph—

(a)“dairy improvement”—

(i)in the case of an agricultural holding or a statutory small tenancy, means a “new improvement” or an “old improvement” within the meaning of [F3section 85 of the 1991 Act];

(ii)in the case of a croft, means a “permanent improvement” within the meaning of section 37 of the 1955 Act;

(iii)in the case of a holding under the 1911 Act to which [F4the 1991 Act] does not apply, means a “permanent improvement” within the meaning of section 34 of the 1886 Act,

so far as relevant to the feeding, accommodation or milking of dairy cows kept on the tenancy;

(b)“fixed equipment” means fixed equipment, within the meaning of [F5section 85 of the 1991 Act], so far as relevant to the feeding, accommodation or milking of dairy cows kept on the tenancy;

(c)all dairy improvements and fixed equipment provided by the tenant shall be taken into account for the purposes of sub-paragraph (1)(a) above, except for such improvements and fixed equipment in respect of which he has, before the end of the relevant period, received full compensation directly related to their value.

(5)For the purposes of this paragraph—

(a)any allowance made or benefit given by the landlord after the end of the relevant period in consideration of the execution of dairy improvements or fixed equipment wholly or partly at the expense of the tenant shall be disregarded;

(b)any compensation received by the tenant after the end of the relevant period in respect of any dairy improvement or fixed equipment shall be disregarded; and

(c)where paragraph 3 above applies, dairy improvements or fixed equipment which would be regarded as tenant’s dairy improvements or fixed equipment on the termination of a former tenant’s lease (if he were entitled to a payment under this Schedule in respect of the land) shall be regarded as the new tenant’s dairy improvements or fixed equipment.

Textual Amendments

F1Words in Sch. 2 para. 7(2) substituted (25.9.1991) by Agricultural Holdings (Scotland) Act 1991 (c. 55, SIF 2:3), ss. 89(2), 88(1), Sch. 11 para. 50(a)(with s. 45(3), Sch. 12 para. 3)

F2Words in Sch. 2 para. 7(2) substituted (S.) (27.11.2003) by Agricultural Holdings (Scotland) Act 2003 (asp 11), s. 95(3)(4), Sch. para. 10(1) (with s. 95(2)); S.S.I. 2003/548, art. 2(i) (with Sch.)

F3Words in Sch. 2 para. 7(4)(a)(i) substituted (25.9.1991) by Agricultural Holdings (Scotland) Act 1991 (c. 55, SIF 2:3), ss. 88(1), 89(2), Sch. 11 para. 50(b)(i)(with s. 45(3), Sch. 12 para. 3)

F4Words in Sch. 2 para. 7(4)(a)(iii) substituted (25.9.1991) by Agricultural Holdings (Scotland) Act 1991 (c. 55, SIF 2:3), ss. 88(1), 89(2), Sch. 11 para. 50(b)(ii)(with s. 45(3), Sch. 12 para. 3)