Regulation 7
1. This Schedule has effect to determine the annual value of an annual value property for the purposes of these Regulations.
2. The annual value shall be taken to be an amount equal to the yearly rent, in respect of a holding comprising the annual value property, at which the holding might reasonably be expected to have been let by a prudent and willing landlord to a prudent and willing tenant, on a tenancy from year to year commencing on 1st April 1988 incorporating the terms set out in paragraph 3 below, taking account (subject to paragraphs 4 to 6 below) of all relevant factors, including (in every case) the character and situation of the holding (including the locality in which it is situated), the productive capacity of the holding and its related earning capacity, and the level of rents for comparable lettings current on 1st April 1988, as determined in accordance with paragraph 6 below, but disregarding (in every case) any liability for payment of drainage rates.
3. The terms of the tenancy referred to in paragraph 2 above are:
(a)a covenant by the tenant in the event of the destruction by fire of harvested crops grown on the holding for consumption on it to return to the holding the full equivalent manurial value of the crops destroyed, in so far as the return of that value is required for the fulfilment of his responsibilities to farm in accordance with the rules of good husbandry;
(b)a convenant by the tenant to insure against damage by fire all dead stock on the holding and all harvested crops grown on the holding for consumption on it;
(c)a power for the landlord to re-enter on the holding in the event of the tenant not performing his obligations under the agreement;
(d)a convenant by the tenant not to assign, sub-let or part with possesion of the holding or part of it without the landlord’s consent in writing.
4. For the purposes of paragraph 2 above, it shall be assumed that the holding would have been let on the terms relating to maintenance, repair and insurance of fixed equipment set out in the Schedule to the Agriculture (Maintenance, Repair and Insurance of Fixed Equipment) Regulations 1973(1).
5. In paragraph 2 above, in relation to the holding–
(a)“productive capacity” means the productive capacity of the holding (taking into account fixed equipment and any other available facilities on the holding) on the assumption that it is in the occupation of a competent tenant practising a system of farming suitable to the holding, and
(b)“related earning capacity” means the extent to which, in the light of that productive capacity, a competent tenant practising such a system of farming could reasonably be expected to profit from farming that holding.
6. In determining for the purposes of paragraph 2 above the level of rents current on 1st April 1988 for comparable lettings, account may be taken of any available evidence with respect to the rents which are, or were, payable in respect of tenancies of comparable agricultural holdings on terms (other than terms fixing the rent payable) similar to those of the tenancy under consideration, but the following shall be disregarded–
(a)any element of the rents in question which is due to appreciable scarcity of comparable holdings available for letting on such terms compared with the number of persons seeking to become tenants of such holdings on such terms;
(b)any element of those rents which is due to the fact that the tenant of, or a person tendering for, any comparable holding is in occupation of other land in the vicinity of that holding that may conveniently be occupied together with that holding; and
(c)any effect on those rents which is due to any allowances or reductions made in consideration of the charging of premiums.
S.I. 1973/1473, amended by S.I. 1988/281.