Fordyce Maxwell: Tenants seem locked in battles their forebears never won

We might say the same about farm tenancy and rent disputes with the proviso that these have run for centuries, with lawyers the only regular winners. The Victorian woodcut of a farmer hauling at the horns of a cow, another hauling at the tail, and the lawyer milking in the middle still holds good.

Yet, there are times when heart and anger and a sense of injustice rule the head, and a dispute about a tenancy or rent goes from heated words and terse letters to the Scottish Land Court. Or, worse, to the Court of Session.

A case that goes there is in deep, often uncharted, waters, as disputants in the now-celebrated Moonzie and Peaston cases – both farm names – have found.

Moonzie was about a rent demand and on what basis it should, or could, be calculated. Peaston was about a tenancy.

In both cases, the Court of Session effectively ruled in favour of the landowners.

Long-term, the Peaston ruling by the Court of Session might have much greater repercussions implying, as it did, that the legal drafting of the Agricultural Holdings Act (Scotland) 2003 was faulty.

However, for most tenant farmers the Moonzie rent ruling has more immediate significance.

It indicated that a tenant’s farm subsidy income should be taken into account when agreeing a rent. Tenants and the farmers’ union argue that it should not.

As a non-lawyer who has never appeared in a civil case – a happy state of affairs I hope to maintain – I hesitate to summarise lengthy legal proceedings. But as I understood the Moonzie ruling, it also indicated that a rent offer on the open market, used as a comparison, could exceed what a profit/loss budget for a farm might suggest was reasonable.

No surprise there. Neighbours in existing tenancies at moderate rents shaking their heads about a ludicrously high offer that has secured a tenancy is a fact of life.

There has never been a shortage of hopefuls offering open market rents related to a realistic budget only in their imagination.

But it’s one thing for everyone to know that, another for it to be enshrined in a Court of Session ruling when, in most cases, rent reviews come along every three years.

Given a reasonable landlord – or usually his agent – and reasonable tenant, agreement is reached after the usual haggling.

However, there are extremes as in every form of human relationship. There are good land agents and bad; there are good, poor and middling tenants on a range of good, poor and middling farms. Add the fact that, like income tax, a rent increase agreed after a good spell for farming might have to be paid out of several following years of low returns, and the potential for argument is clear.

As is the thorny subject of European Union and less-favoured area subsidies tenants get, worth an average of more than £25,000 per Scottish farm, and in some cases much, more.

Landlords think they should have a share of that and now the Court of Session seems to have agreed.

Allegations of some agents using aggressive tactics to push up rents have increased. Partly that is because in the past year or two, farmers’ returns have been good. Landlords would like a share in that, too, while it lasts.

In Scotland, the aggression is also driven by landowners’ fears that tenants’ right to buy will become law. That fear is the reason new long-term tenancies have vanished while the squeeze on existing rents has increased.

Yet in spite of the Moonzie and Peaston rulings, endless “name withheld” claims about evil landowners and mis-treatment of innocent tenants in the farming press of late, and uncertainty about how Europe’s common agricultural policy will change, guess what?

Demand for tenancies and exhortations to give entrants a chance – usually, let’s remember, a chance foiled by demand from existing farmers with a strong bank balance and growing family – continue unabated.

Recent limited tenancy offers by Buccleuch Estates, the Crown Estate and the Forestry Commission produced a huge response.

Is that hope over experience, or recognition that in spite of all pitfalls and a probable failure for a new tenant to get any kind of subsidy a farm tenancy is still a good thing?

I hope new tenants will succeed. I hope existing tenants negotiate rents as successfully as possible. But the pendulum has swung in favour of the landlords, and I see no sign of it swinging back any year soon.