SHERIFFDOM OF TAYSIDE, CENTRAL AND FIFE AT STIRLING

 

 

B255/05

 

JUDGEMENT

 

in causa

 

SUMMARY APPLICATION under The Land Reform (Scotland) Act 2003, Part 2, Chapter 6, Section 61

 

By

 

HOLMEHILL LIMITED, a company incorporated under the Companies Acts and LIMITED BY GUARANTEE, having a place of business at Rannoch House, 20, Dargai Terrace, Dunblane, Stirlingshire FK15 0AU

PURSUERS

 

Against

 

THE SCOTTISH MINISTERS, Scottish Executive, Victoria Quay, Edinburgh EH6 6QQ

 

FIRST RESPONDENTS

 

STAKIS LIMITED, a subsidiary of Hilton Hotels plc, having a place of business at Maple Court, Central Park, Reid Crescent, Watford, Hertfordshire WD24 4QQ

 

SECOND RESPONDENTS

 

And

 

STIRLING COUNCIL, a local authority constituted under the Local Government etc. (Scotland) Act 1994, and having the seat of its administration at Council Headquarters, Viewforth, Stirling

 

THIRD RESPONDENTS

 

 

Act: Campbell Q.C.

 

Alt: Miss Poole, Advocate, for First Respondents

McIlvride, Advocate, for Second Respondents

 

 

 

STIRLING: 27^th April 2006

 

The sheriff having resumed consideration of the cause

FINDS IN FACT

 

1.      The parties are as designed in the instance.

2.      This court has jurisdiction.

3.      The land at Holmehill, Dunblane, (the land) is owned by Stakis Limited, the Second Respondents.

4.      The land is shown in the Adopted Stirling Local Plan as a safeguarded area and is within a conservation area.

5.      Part of the land is subject to an Agreement under the Town and Country Planning (Scotland) Act 1972 s.50, now the Town and Country Planning (Scotland) Act 1997 s.75, whereby part of the land is reserved inter alia as open space.

6.      In August 2003, for land to be excluded from being registrable under the Act, the number of eligible persons in the community was raised from over 3000 to over 10000.

7.      The relevant population of Dunblane is 6,600.

8.      On 14^th June 2004, The Land Reform (Scotland) Act 2003, (the Act), came into force.

9.      The land is registrable land in terms of s.33 of the Act.

10.  In mid December 2004, the Second Respondents exposed the land for sale.

11.  In mid to late December 2004, Mr Bennett, a local resident and officer of Dunblane Development Trust, first noticed that the land was exposed to sale.

12.  On 4 January 2005, the first public meeting was convened by Dunblane Development Trust.

13.  A public petition was instigated which attracted 1131 signatures of those eligible to vote.

14.  A further 244 signatories were discounted leaving 887 signatures.

15.  The percentage of support amounting to 13.62 % was calculated by comparing the 887 figure with the full electoral register figure of 6670.

16.  On 26^th January 2005, Dunblane Development Trust submitted an application for registration of a community interest in the land.

17.  On 27^th January 2005, the Scottish Ministers received this application.

18.  On 9^th February 2005, the Scottish Ministers advised Dunblane Development Trust that, as its Memorandum and Articles of Association did not conform to the requirements of s.34 of the Act, re-application by a community body conform to the Act, would be necessary.

19.  On 14^th February 2005, the company known as Holmehill Limited, the Pursuers, was incorporated.

20.  On 14^th February 2005, Holmehill Limited made an application, in the prescribed form and accompanied by information of the prescribed kind in terms of s.37 of the Act, to register a community interest in the land.

21.  On 15^th February 2005, the Scottish Ministers received this application and gave written confirmation to Holmehill Limited that they were satisfied that the main purpose of the body was consistent with furthering the achievement of sustainable development in terms of s. 34(4) of the Act.

22.  Accordingly, Holmehill Limited is a community body in terms of s.34 of the Act.

23.  Holmehill Limited is a body consisting of a significant number of members of a community in terms of s. 38(1) of the Act and has a substantial connection with the land.

24.  The Scottish Ministers requested and the pursuers agreed that the date of the application be changed to 18^th February 2005.

25.  On 3^rd March 2005, the application, Register No CB00016, was entered in the Register of Community Interests in Land by direction of the Scottish Ministers and a prohibition notice issued to the Second Respondents in terms of s.37 of the Act.

26.  On 23^rd March 2005, the Scottish Ministers received representations from the Second Respondents.

27.  The application is a late application in terms of s.39 of the Act.

28.  The pursuers in the application gave seven reasons for the application being a late application. These were:

"1. For a number of years Dunblane Development Trust, Holmehill Limited's sister organisation, have been considering ways of improving access to Holme Hill for the community and of using parts of the land for community projects (see below). This was identified as a priority for the Trust in the Community Plan, following community consultation. The Trust relies solely on voluntary effort by residents and has to plan its work in stages. In the last few months the Trust has been occupied with work on flood-damaged areas of the town, close to Allan Water, and with improvements to the main entrances to the town. Due to the opportunity presented by the advertisement of Holme Hill, the Trust has brought forward its plans for this area.

2. The Trust has only recently become aware of the new legislation allowing communities to register an interest in purchasing land.

3. In association with Dunblane Development Trust, in the past three months a group of local people has formed to create community allotments, has discovered that there is considerable interest in having more land available for similar activities, and is now looking for more land.

4. The community was under the (mistaken) impression that the land was held in trust for the people of Dunblane by the owners of the Hilton Hotel. This was the view of many older residents consulted during the Community Planning process. In the event, this only applies to a small area of land not the subject of this application.

5. The community thought that whilst land was in the ownership of the Hotel, then it would be safeguarded. The sale advertisement and potential separation of the ownership of the Hilton Hotel and the land created a threat to community access to the land.

6. The land had suffered from serious neglect for approximately two years, during which time members of the community have requested the local authority and SEPA to take action against dumping and erosion by heavy vehicles. As no action was being taken to protect the ecology of land, it has now become clear that the only way to maintain and enhance it was to take it into community ownership.

7. The community thought that the existence of a minute of agreement between former owners Stakis and Stirling Council protected the land in its wild state. It has only now become apparent that this agreement is only enforceable by the two parties to it but no one else."

29.  On 5^th April 2005, the Scottish Ministers issued a letter to which a formal Notice in terms of s.37(17) of the Act was attached giving notice that having considered the pursuers' application, they had decided that the community interest should not be registered.

30.  The Scottish Ministers gave seven reasons in response to those of the pursuers (abbreviated and underlined) that the requirements of s.39(3)(a) of the Act (Good Reasons) had not been met. These were (in italics):

1.      In the last few months, the Trust has been occupied with work on flood-damaged areas of the town. "While the Scottish Ministers appreciate the importance of this work, this is not an appropriate reason for the application being late as a timeous application could have been submitted between implementation of the legislation in June 2004 and the last few months."

2.      The community has only recently become aware of the new legislation. "While this may be the case, the legislation was commenced in June 2004, following 5 years of public consultation. The Scottish Ministers believe that this is no longer an appropriate reason for the application being late as other community bodies have submitted timeous applications."

3.      A group of local people has formed in the last 3 months to create community allotments and more land is required. "The Scottish Ministers consider that this does not address why the application was not submitted timeously."

4.      The community was under the (mistaken) impression that the land was held in trust for the people of Dunblane by the owners of the Hilton Hotel. This was the view of many of the older residents.... "The community body appears to have relied on the views of some of the older residents within the community, and there is no evidence that the community body had investigated these claims or sought professional advice. Had this point been pursued seriously at an earlier stage, Scottish Ministers therefore conclude that the community body's mistaken views do not demonstrate good reason for the application being late."

5.      The community thought that whilst the land was in the ownership of the Hilton Hotel, it would be safeguarded. "The reason for securing a timeous application is to secure a right to buy if the land is to be sold at any time in the future. A timeous application would have secured this right."

6.      The land has suffered from serious neglect for approximately 2 years ...it has now become clear that the only way to maintain and enhance it was to take it into community ownership. "As the community body has been aware of the alleged neglect of the land over the past two years, this seems to support more the need for an early application rather than late."

7.      The community thought that the existing minute of agreement between the owner and Stirling council protected the land in its wild state. It has only become apparent that the agreement is only enforceable by the two parties to it but no one else. "As with paragraph 4 above, there is no evidence that the community body investigated these claims or sought professional advice. Had this point been pursued seriously at an earlier stage, a timeous application could have been submitted. There is no explanation why these issues had not been pursued earlier. The fact that the community misunderstood the terms of the agreement does not address the reason why the application was not timeous."

31.  The Scottish Ministers also gave as a reason for refusal that the requirements of section 39(3)(c) of the Act (Public Interest) had not been met. The reason given was:

"The factors considered in relation to the public interest in that section do not demonstrate that it is strongly indicative that it is in the public interest to enter the community interest in the Register. While the aspirations of the community body, if successful, would appear to contribute positively to the local community, the Scottish Ministers have noted a number of references within the application directly relating to preventing future development on the land to be registered. There is evidence to suggest therefore that in this case the Community Right To Buy process could be used to thwart the planning process. Consequently, the Scottish Ministers have concluded that, as these issues are finely balanced, the public interest factors are not strongly indicative that it is in the public interest to approve the application."

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FINDS IN FACT AND LAW

That the First Respondents, having acted lawfully and reasonably in making their decision

THEREFORE

Sustains the second and third pleas in law of the First and Second Respondents; Repels the pleas in law of the Pursuers; Refuses the appeal; Grants decree of absolvitor; Finds the Pursuers liable to the First and Second Respondents in the expenses of the appeal; certifies the cause as suitable for the employment of junior counsel.

 

 

 

 

 

 

 

 

John Craig Cunningham McSherry

27^th April 2006

 

 

 

 

 

 

 

 

THE NATURE OF THE APPEAL

This is an appeal on behalf of Holmehill Limited, a community body in terms of the Act, against a decision of the Scottish Ministers in connection with the application to register a community interest in the land at Holmehill, Dunblane in the Register of Community Interests in Land. The decision which is the subject of this appeal is contained in a letter with a Notice attached dated 5 April 2005 in which the Scottish Ministers declined to register a provisionally registered community interest upon the Register of Community Interests in Land. It is believed to be the first such appeal under this legislation. This appeal against the Decision has proceeded by Summary Application before me at Stirling under the provisions of Section 61(2)(a) of the Land Reform (Scotland) Act 2003 (the Act). The hearing took place on 14^th, 15^th, 16^th November, 16^th December 2005 and 6^th February 2006. The appeal involving a proof before answer was conducted with oral and written evidence. The appeal is opposed by the Scottish Ministers, the First Respondents, and by Stakis Limited, the Second Respondents and the owners of the land over which it is sought to register the community interest. Stirling Council was served with the notice of the appeal, but did not enter appearance. There are no procedural issues raised in this appeal in connection with the form of the application for registration, which was submitted, nor in connection with the alteration of the date of application, nor in connection with the process of the appeal. The registration of a community interest does not guarantee any right to purchase land, which is dealt with by other sections of Part 2 of the Act, and which itself requires Scottish Ministers' consent. The parties were agreed as to the authenticity or probative value of the documents lodged with copies being treated as principals; that the dates or times when communications were made by one party to another; that where appropriate, proper notice was given by any party to another; that decisions by the Scottish Ministers were taken within the time allowed by the Act; that the land in question is registrable land and that Holmehill Limited is a properly constituted Community Body entitled to make an application for the registration of a community interest; that Holmehill Limited is a body consisting of a significant number of members of a community (s. 38(1)) and that it has a substantial connection with the land; that the application is a "late application" as defined in s. 39; that the only legislative provisions bearing on this appeal are the Act itself and The Community Right to Buy (Definition of Excluded Land) (Scotland) Order 2004 (SI 2204 No. 296); and that the Carltona principle applies so that Richard Frew and his civil service colleagues are to be treated as the embodiment of the Scottish Ministers for this purpose.

 

THE LAW RELATING TO THE REGISTRATION OF THE COMMUNITY'S INTEREST IN THE LAND AND THE EFFECT THEREOF.

In Part 2 of the Land Reform (Scotland) Act 2003 under the heading 'The Community Right to Buy' is found the relevant law pertaining to the steps involved in proceeding to exercise a community right to buy. Chapter 2 of the Act concerns the Registration of Interests. There are two steps in the process, namely, an application for registration of a community's interest in the land and, after such registration, an application to exercise the community's right to buy. This appeal is concerned with the first step, registration, although considerations involved in the second step may be relevant.

 

 

Registrable land.

First of all the land needs to be registrable as defined in Section 33 of the Act.

(1) The land in which a community interest may be registered under this Part of this Act ("registrable land") is any land other than excluded land...

 

There is no issue in this appeal that the land is registrable.

Community Body.

 

Further, the community body needs to meet the requirements of Section 34.

 

(1) A community body is, subject to subsection (4) below, a company limited by guarantee the memorandum and articles of association of which include the following-

(a) a definition of the community to which the company relates;

(b) provision enabling the company to exercise the right to buy land under this Part of this Act;

(c) provision that the company must have not fewer than 20 members;

(d) provision that the majority of the members of the company is to consist of members of the community;

(e) provision whereby the members of the company who consist of members of the community have control of the company;

(f) provision ensuring proper arrangements for the financial management of the company and the auditing of its accounts;

(g) provision that any surplus funds or assets of the company are to be applied for the benefit of the community; and

(h) provision that, on the winding up of the company and after satisfaction of its liabilities, its property (including any land acquired by it under this Part of this Act) passes--

(i) to such other community body or crofting community body as may be approved by Ministers; or

(ii) if no other community body or crofting community body is so approved, to Ministers or to such charity as Ministers may direct.

 

(4) A body is not a community body unless Ministers have given it written confirmation that they are satisfied that the main purpose of the body is consistent with furthering the achievement of sustainable development.

 

(5) Unless Ministers otherwise direct, a community--

(a) shall be defined for the purposes of subsection (1)(a) above by reference to a postcode unit or postcode units; and

(b) shall comprise the persons from time to time--

(i) resident in that postcode unit or in one of those postcode units; and

(ii) entitled to vote, at a local government election, in a polling district which includes that postcode unit or those postcode units (or part of it or them).

 

(6) In subsection (5) above, "postcode unit" means an area in relation to which a single postcode is used to facilitate the identification of postal service delivery points within the area.

 

(7) The memorandum and articles of a company which is a community body may, notwithstanding the generality of paragraph (h) of subsection (1) above, provide that its property may, in the circumstances mentioned in that paragraph, pass to another person only if that person is a charity.

 

(8) In this section, "charity" means a body which is entitled, by virtue of section 1(7) of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1990 (c.40), to describe itself as "a Scottish charity".

 

The Scottish Ministers have provided written confirmation in terms of Section 34(4) that they are satisfied that the main purpose of the pursuers is consistent with furthering the achievement of sustainable development. Accordingly, the pursuers are a community body in terms of the Act.

 

Register of Community Interests in Land.

 

Section 36 concerns the Register of Community Interests in Land.

 

(1) The Keeper shall set up and keep a register, to be known as the Register of Community Interests in Land (the "Register").

 

(2) The Register shall be set up and kept so as to contain, in a manner and form convenient for public inspection, the following information and documents relating to each community interest registered in it--

(a) the name and address of the registered office of the company which constitutes the community body which has registered the interest;

(b) a copy of the application for registration under section 37 below;

(c) a copy of the notice of prohibition under section 37(5)(e) below;

(d) a copy of the notice sent under section 37(17) below of Ministers' decision that the interest is to be entered in the Register;

(e) the date of registration;

(f) a description of the land, including maps, plans or other drawings (prepared to such specifications as are prescribed);

(g) the date when the registration will, under section 44 below, cease to have effect;

(h) the date of any deletion of the interest under section 45 or 54 below;

(i) a copy of any notification under section 48 below;

(j) a copy of any notice sent under section 49 below;

(k) a copy of any confirmation received in pursuance of that section;

(l) a copy of any notice sent under section 50(3) below;

(m) a copy of any decision as to consent given under section 51 below;

(n) a copy of any notice given under section 54 below;

(o) in the case of each copy document referred to in this subsection, the date of the original;

(p) such other information as Ministers consider appropriate.

...

 

The Application.

A community interest in land may only be registered upon an application, which meets the requirements of Section 37. The relevant sections are:

 

(1) A community interest in land may be registered only upon an

application made by a community body to Ministers in the prescribed form

and accompanied by information of the prescribed kind, including

information (provided, where appropriate, by or by reference to maps or

drawings) about the location and boundaries of the land.

...

(5) On receipt of an application, Ministers shall-

(a) send a copy of the application and the accompanying information to

the owner of the land and to any creditor in a standard security over an

interest in the land;

(b) invite the owner of the land to send them, so as to be received not

later than 21 days after the sending of the invitation, views in writing

on the application;...

(d) send a copy of the invitation under paragraph (b) above and a copy

of any invitation under paragraph (c) above to the community body; and

(e) by notice sent to-

(i) the owner of the land;...prohibit the owner ... from taking, during the period

beginning with the date on which the owner ...receives the notice and ending on the date on which Ministers

determine whether an interest is to be registered, any action which, if

the interest had been registered, would be prohibited under section

40(1) below.

(7) Ministers shall send a copy of-

(a) each application received by them, together with a copy of the

accompanying information;

(b) each notice sent under subsection (5)(e) above,

to the Keeper.

(8) A transfer in breach of a prohibition imposed under subsection

(5)(e) above is of no effect.

(9) Ministers shall-

(a) send a copy of any timeous response to an invitation given under

subsection (5)(b) or (c) above to the community body; and

(b) invite it to send them, so as to be received not later than 21 days

after the invitation under this subsection, its views in writing on that

response.

(10) Ministers shall take any views timeously sent to them under this

section into account when considering whether the community interest to

which those views relate should be entered in the Register.

(12) Declinature of an application is, for the purposes of subsection

(17) below, to be regarded as a decision not to enter the community

interest in the Register.

(13) More than one community interest may be registered in respect of

the same land.

(17) Ministers shall, within 63 days of receiving an application

under subsection (1) above, send notice of their decision whether or not

the community interest is to be entered in the Register together with a

statement of their reasons-

(a) to the applicant community body;

(b) to the owner of the land;...

(18) A notice under subsection (17) above shall-

(a) contain information about the effect of registration of a community

interest or, as the case may be, of Ministers' decision that such an

interest is not to be entered in the Register and about the rights of

appeal under section 61 below; and

(b) be in the prescribed form

 

There was no issue that these requirements have been met.

Criteria for Registration of an Application.

The criteria for registration are set out in Section 38 of the Act.

(1) Ministers shall not decide that a community interest is to be

entered in the Register unless they are satisfied-

(a) that the land is registrable land;

(b) that-

(i) a significant number of the members of the community defined

under section 34(1)(a) above have a substantial connection with the

land; or

(ii) the land is sufficiently near to land with which those members

of that community have a substantial connection and that its

acquisition by the community body is compatible with furthering the

achievement of sustainable development;...

(d) that there is within the community a level of support sufficient to

justify such registration; and

(e) that it is in the public interest that the community interest be so

registered.

 

(2) For the purposes of subsection (1)(d) above, Ministers-

(a) shall regard an indication of the approval of one tenth or more of

the members of the community; and

(b) may regard an indication of the approval of less than one tenth of

those members,

as signifying a sufficient level of support.

(3) References in this section to the community are, as respects a

community body, references to the community defined in relation to that

body under section 34(1)(a) above.

There is no issue that these requirements have been met.

Late Applications.

Section 39 sets out the procedure for late applications.

(1) This section applies in relation to an application to register a

community interest in land-

(a) where the application is received by Ministers-

(i) after the date on which the owner of the land ...has taken action which, if a community interest had been registered,

would be prohibited under section 40(1) below; and

(ii) before the date on which-

(A) missives for the sale and purchase of the land are concluded;

or

(B) an option to acquire the land is conferred,

in pursuance of that action;...

 

(2) Where this section applies in relation to an application-

(a) the owner of the land ...shall, on receipt of an invitation under section 37 above, inform Ministers that this section applies; and

(b) the procedure for registering community interests in land set out

in section 37 above is, for the purposes of the application, subject to

the following modifications-

(i) paragraph (b) of subsection (9) does not apply; and

(ii) in subsection (17), for "63" there is substituted "30".

(3) Where this section applies in relation to an application,

Ministers shall not decide that a community interest is to be entered in

the Register unless they are (additionally to the matters as to which they

are to be satisfied under section 38 above) satisfied-

(a) that there were good reasons why the community body did not secure

the receipt of an application before the owner of the land or, as the

case may be, the creditor took the action, or gave the notice, such as

is mentioned in subsection (1) above;

(b) that the level of support within the community for such

registration is significantly greater than that which Ministers would,

by virtue of subsection (2) of that section, have considered sufficient

for the purposes of subsection (1)(d) of that section had the

application been received before that action was taken or, as the case

may be, the notice was given; and

(c) that the factors bearing on whether it is or is not in the public

interest that the community interest be registered are strongly

indicative that it is.

(4) Where a community interest in land is registered in pursuance of

an application in relation to which this section applies-

(a) the owner of the land is, for the purposes of this Part of this Act

(other than section 59(4)), deemed to have, on the date on which that

interest is so registered, given notice under section 48(1) below that a

transfer is proposed;

(b) section 49 below does not apply in so far as it relates to that

interest; and

(c) for the purposes of sections 55(2) and (4), 56(3), 59(1) and

65(1)(a) below, the community body is deemed to have sent the

confirmation which Ministers would, had section 49 below applied, have

required to seek under subsection (2)(a) of that section on the date on

which the interest is registered.

(5) Where, but for the provision made by subsection (1)(a)(ii) above,

this section would apply in relation to an application to register a

community interest in land Ministers-

(a) shall decline to consider the application; and

(b) shall be relieved of their duties under subsections (5) to (10),

and paragraphs (b) and (c) of subsection (17), of section 37 above in

relation to that application.

The Scottish Ministers are not satisfied in terms of subsections 39(3)(a), (good reasons), and 39(3)(c), (public interest). This is the basis of their decision to refuse to register the community interest and is the subject of this appeal.

The Effect of Registration.

 

The important effect of registration of a community interest is set out in Section 40 of the Act.

(1) For so long as a community interest in land is registered the

owner of the land, and any creditor in a standard security having a right

to sell the land, is prohibited from-

(a) transferring that land (or any land of which that land forms part);

or

(b) taking any action with a view to the transfer of that land (or any

land of which that land forms part),

except in accordance with this Part of this Act.

(2) A transfer in breach of subsection (1)(a) above is of no effect.

(3) Subsection (1) above operates so as to prohibit transfers of, or

other actions in relation to, land in respect of which no community

interest has been registered only where that transfer, or action, also

relates to land in respect of which a community interest has been

registered.

 

The duration of registration is for a period of 5 years and may be re-registered by application for a further period in terms of Section 44 of the Act.

 

 

 

 

 

THE EVIDENCE.

 

James Bennett.

He was the first witness for the Pursuers and was aged 40 and the Chief Executive Officer of Scotland Unlimited. He lived in Dunblane and took part in the formation of Holmehill Limited, the Pursuers. In mid to late December 2004 he noticed signs on Holmehill that the land was for sale. The site lay between the Hilton Hotel and Dunblane Cathedral. This was reputed to be the founding site of Dunblane. There were no buildings on it. It was registered as green space. It was hilly with 200-year-old deciduous trees. He had a series of discussions with his neighbours about the site. He said that he was vaguely aware of the Land Reform (Scotland) Act 2003. He looked at websites and believed that the land at Holmehill could be registrable under the Act. A public meeting was held on 4^th January 2005 and a great deal of interest was shown. An interim committee of Dunblane Development Trust was set up to register the land at Holmehill under the Act. Dunblane Development Trust was owned and controlled by the local community to develop community interests towards asset acquisition. There were development trusts across the UK. Dunblane Development Trust was concerned with environmental improvements such as when 30 volunteers cleaned a dilapidated pond for new planting. Dunblane Development Trust obtained signatures in early January 2005. It discussed the planning designation of Holmehill with the local authority, Stirling Council. Application was made through the Dunblane Development Trust to the Scottish Ministers for registration of the community interest in the land at Holmehill. 13/6 of process were petition forms, some of which had script on the rear. He said that he did not remember seeing this script before. He said that the individual who distributed these forms might have typed this on back. He said that he had not typed the wording. The wording had not been written by Dunblane Development Trust. The forms had been distributed electronically to a list of e-mail addresses of members. Then each member would go round neighbours obtaining signatures. 1268 signatures were obtained. Dunblane Development Trust carried out extensive checks as the post code of each signatory had to be within that of the Dunblane community and the signatory's name had to be on the electoral list to be valid under the Act. Mr Bennett rechecked this. The Application was returned in February 2005 as the Dunblane Development Trust was not a recognised body in terms of the Act as it did not have a minimum of twenty members under its Memorandum and Articles of Association and there was a lack of individual's post codes. As there was complication in changing the Memorandum and Articles of Association of the Dunblane Development Trust, forming a new company, Holmehill Limited, was easier. This Community Body had to be approved by the Scottish Executive before an application could be made. It was so approved and Mr Bennett was its chairman. A new application was submitted in name of Holmehill Limited. Once the application was received and the community interest was registered, in the normal course of events, the Community Body could acquire the land. Acquisition required Scottish Ministers' consent. The application was placed on the register of community interest kept by the Keeper of the Registers for a period of thirty days. During this period the application was checked by civil servants as to whether registration would be in the public interest. 13/1 of process was the application dated 18^th February 2005, which was received by the Scottish Executive on 1^st March 2005. Mr Bennett understood that a timeous application was one submitted before the land in question was exposed to sale. A late application was, as in this case, where the land was already marketed for sale. There were two electoral roles: one full role to be found at the public library and electoral office, the other, an edited role. The latter was where those on the full role did not wish their names to be used for marketing purposes. Approximately 20 per cent opted out of the edited role. Holmehill Limited consulted the full roll in the public library, which was one year out of date. Holmehill Limited supplied to the Scottish Executive the edited role of which 19 per cent of those on the roll had signed. Mr Bennett in answer to question 7 of the application confirmed that a significant number of members of the community had a substantial connection with the land to be registered. In the alternative, he confirmed that the land was sufficiently near to land with which those members of that community have a substantial connection and its acquisition by Holmehill Limited would be compatible with furthering the achievement of sustainable development. Although only required to provide details if the answer to either of the alternatives was in the negative, he went on to provide details even although he had answered in the affirmative to both. In the application he stated:

"The people of Dunblane have had access to this land for many years. It has become a crucial point of access to wild land within Dunblane and part of the outdoor culture, so much so that its being placed on the market was met with shock by people from all sections of the community. The company has well advanced plans for sustaining and enhancing this highly valued resource."

In evidence he said that the plans were well advanced, given the time the company had had. After consulting, there were a series of suggestions as to what could be done with the land. Under current planning regulations the land was designated as green space. The two hills fell within a conservation area. There was a section 75 agreement between the local authority, Stirling Council, and Stakis. Mick Stewart, Director of Planning, informed the company of the various issues affecting the land. He explained the terms of the section 75 agreement, the conservation status and the green space designation. On page 8a of the application seven reasons are given for the application being submitted late:

"1. For a number of years Dunblane Development Trust, Holmehill Limited's sister organisation, has been considering ways of improving access to Holme Hill for the community and of using parts of the land for community projects (see below). This was identified as a priority for the Trust in the Community Plan, following community consultation. The Trust relies solely on voluntary effort by residents and has to plan its work in stages. In the last few months the Trust has been occupied with work on flood-damaged areas of the town, close to Allan Water, and with improvements to the main entrances to the town. Due to the opportunity presented by the advertisement of Holme Hill, the Trust has brought forward its plans for this area."

In evidence he said that it was clear that the Holmehill issue had been with the community for some time. Holmehill was the fourth priority for the Trust. These priorities were established in 2003. He did not provide any other evidence that Holmehill was amongst the priorities established by the Trust in 2003 or, indeed, at any other time prior to December 2004.

 

"2. The Trust has only recently become aware of the new legislation allowing communities to register an interest in purchasing land"'

In evidence he said that he had become recently aware of the new legislation which awareness had been promoted by seeing the 'for sale' signs on the land. He also knew of a Bridge of Allan community group concerned with Park of Keir near Bridge of Allan and that there had been local planning battles there for some time. He said that he was not aware that the Act had been used by the Bridge of Allan group and had had no liaison with it.

 

'3. In association with Dunblane Development Trust, in the past three months a group of local people has formed to create community allotments, has discovered that there is considerable interest in having more land available for similar activities, and is now looking for more land. '

In evidence Mr Bennett said that the allotment group had approached him in January 2005 and the land would allow further development of allotment space.

 

'4. The community was under the (mistaken) impression that the land was held in trust for the people of Dunblane by the owners of the Hilton Hotel. This was the view of many older residents consulted during the Community Planning process. In the event, this only applies to a small area of land not the subject of this application.'

In evidence Mr Bennett said that Stakis offered Holmehill as a gift to the people of Dunblane if planning permission was given for one area of it. The locals thought that this meant the land was to be held in trust for the children of Dunblane. The agreement was between Stirling council and Stakis.

 

'5. The community thought that whilst land was in the ownership of the Hotel, then it would be safeguarded. The sale advertisement and potential separation of the ownership of the Hilton Hotel and the land created a threat to community access to the land. '

Mr Bennett said that in 1980 Stakis Limited said it wanted the land to be owned by the people of Dunblane.

 

'6. The land had suffered from serious neglect for approximately two years, during which time members of the community have requested the local authority and SEPA to take action against dumping and erosion by heavy vehicles. As no action was being taken to protect the ecology of land, it has now become clear that the only way to maintain and enhance it was to take it into community ownership.'

Mr Bennett said that the land was used as a dump by the hotel. A Mr Colin Gray had suggested that community ownership might help the environment. Mr Bennett said that the company had access to a group of professionals which, voluntarily, could turn its mind to sustaining the land.

 

'7. The community thought that the existence of a minute of agreement between former owners Stakis and Stirling Council protected the land in its wild state. It has only now become apparent that this agreement is only enforceable by the two parties to it but no one else.'

Mr Bennett said that this went back to the meeting with the Director of Planning in January who had explained what the agreement meant.

 

At page 10a of the application there were to be found a number of propositions in answer to question 14 where an explanation was required as to how the proposals of the Community Body are compatible with furthering the achievement of sustainable development of the land and any salmon fishings and mineral rights included in the application.

 

"Holmehill Limited proposes that the land remain 'wild' in order to enhance the ecology of the area and attract wildlife. The Trust also seeks to enhance public access to Holme Hill for recreational, health, educational and spiritual purposes. We propose three stages in the sustainable development of the land:

mapping and feasibility study, archaeological and ecological survey. This is the ancient 'dun' of Dunblane but has not yet been properly surveyed. In terms of ecology, a tree map will be produced and a survey of wildlife carries out (both peregrines and red kites have been reported on Holme Hill). Remedial action to remove dumped rubbish and dangerous branches, collapsed walls, rusted fencing material and other hazards is a priority.

Bringing the woodland up to standard will include the following activities:

Diagnose and carry out tree surgery requirements

Reinstate paths, which are currently in a dangerous condition

Reinstate field drains to prevent flooding and oath erosion

Establish and carry out a new planting/re-growth plan for native species including yew, holly and oak.

Re-seeding the meadow areas of the land with native wildflowers.

Re-establish boundary hedges to attract wildlife.

 

There is a sloping meadow of approximately 0.5 ha adjacent to Braeport community centre which lends itself to a variety of community uses integrated with the community centre's objectives. We plan to consult the community on these uses; possibilities include community composting, an orchard, sensory garden, children's garden, allotments and horticulture - including raising plants for the Dunblane in Bloom initiative.

In addition we are investigating the potential of the wood for berry and mushroom production."

 

He was referred to 13/27 of process, guidance notes published by the scotex. Paragraph 24 of the guidance states that development can be of an environmental, economic or social nature and Mr Bennett said that all three benefits were covered by the application. Not every component need be compatible with the achievement of sustainable development but rather the application as a whole should be so compatible.

Mr Bennett said that the response to question 15 also met all three objectives. An explanation was required as to how the development proposals were compatible with furthering the achievement of sustainable development of the community and how they will offer increasing social and economic advantage to that community. At page 11a was to be found five strands to the community development proposal, all of which promoted synergy between Holmehill and the adjacent community and ecclesiastical centres. These were

1 Creating accessible woodland

2 Play, Adventure and Education

3 Healthy and Sustainable Living

4 Connecting History and Spirituality

5 A Wood That Works

Mr Bennett said that he understood that the application did not subvert the planning process. He gave the example that, given the current designation of the land as green space should the application have objectives which ran contrary to this, such as building houses to make money for the community, this would subvert the planning process. In answer to question 18, which required an explanation as to how the Community Body considered that the granting of the application would be in the public interest, six main reasons were given. These were

1          Public Health and Leisure

2          Ecology

2           Local Economy

3           Landscape

4           Heritage and Spirituality

5           Community environmental awareness

Holmehill Limited had taken the advice of the local Director of Planning, who had advised that the only way that the current planning designation could be safeguarded was by ownership by the community. The husbandry of Holmehill had become poorer with the old house being demolished in the 70s and there was now detritus on the land such as old mattresses etc. Holmehill Limited was committed to economic development on Holmehill. Three examples were the proposed mushroom production, berry production and compost production using worms. None of these involved building. Mr Bennett had looked at free tree surgery training and forestry skills. Organic vegetable production would make use of the wild state of the land with low impact and high yield. Holmehill Limited had the services of two consultants with Scottish Natural Heritage.

He was referred to 13/2 of process which was a briefing note to give information on Holmehill and its history to people and those of influence such as MPs, MSPs ,Church Heads and Headteachers whose support Holmehill Limited was soliciting. He was referred to a habitat survey of the Holmehill site marked in orange; the land lost through previous developments; the extent of the land delineated in red; post code maps; the Memorandum and Articles of Association of Holmehill Limited; the list of members of Holmehill Limited; a data base of signatories street by street; the edited electoral register; correspondence; the agreement between Stirling Council and Stakis plc with maps and a copy e-mail to Colin Gray. Holmehill Limited withdrew signatories on 13/13, sheet 33 of the petitions as there was a hand-written amendment "To prevent real estate development". Mr Bennett told Colin Gray that this was not the view of Holmehill Limited. Holmehill Limited believed that sustainable development included economic or commercial development such as production of mushrooms and berries. Mr Bennett went on to say that the prevention of real estate development did not reflect the point of view of Holmehill Limited. 13/12 and 13/14 were pages showing undersigned electors of Dunblane who supported the purchase of Holmehill on behalf of the local community. However, on the rear of each of these pages was typescript headed "Public Petition to Save Holme Hill ." It stated:

"Holme Hill has been put up for sale by its current owners, the Hilton. The asking price is £750,000 - which can only mean that the purchaser will be intent on developing it. This would destroy an immensely important part of Dunblane's historical and natural heritage and a much loved and needed leisure facility......with sufficient signatures we will be able to ensure that the executive is committed to helping us save Holme Hill ."

Mr Bennett said that he had asked that that page be withdrawn from the application. He said that it didn't reflect the Holmehill Limited's point of view. However, at the foot was the instruction "Further information available from [email protected]." Mr Bennett said that he had no idea where this typescript on rear had come from. It was neither from Holmehill Limited nor from him. 13/15 was a letter dated 15^th February 2006 confirming that under section 34(4) of the Act, Scottish Ministers were content that main purpose of Holmehill Limited was consistent with furthering the achievement of sustainable development. 13/16 was a letter from the Scottish executive to Hilton hotels prohibiting them from taking any action as set out in section 40(1) of the Act. 13/18 was a Ministerial Direction dated 4^th March 2005 to the Keeper of the Registers of Scotland. 13/19 set out reasons on behalf of Stakis Limited why the community interest should not be registered. 13/20 was the Notice by the Scottish Ministers under section 37(17) of the Act not to register Holmehill Limited's interest in the land. 13/21 was the Ministerial Direction dated 5^th April 2005 to the Keeper of the Registers of Scotland to delete the registration of Holmehill Limited's interest in the land.

Seven reasons were set out for the refusal by the Scottish Ministers to register Holmehill Limited's interest in the land.

 

1.      In the last few months, the Trust has been occupied with work on flood-damaged areas of the town. "While the Scottish Ministers appreciate the importance of this work, this is not an appropriate reason for the application being late as a timeous application could have been submitted between implementation of the legislation in June 2004 and the last few months." Mr Bennett said that a community body had to prioritise and it was unreasonable to expect that an application could have been made in these circumstances.

2.      The community has only recently become aware of the new legislation. "While this may be the case, the legislation was commenced in June 2004, following 5 years of public consultation. The Scottish Ministers believe that this is no longer an appropriate reason for the application being late as other community bodies have submitted timeous applications." Mr Bennett said that there had not been 5 years of public consultation regarding communities of more than 3000 people. Mr Bennett thought that the Act applied to such communities prior to November 2003 then in June 2004 communities under 10,000 people could apply for registration. The adult population of Dunblane was 6,600. This was not an appropriate reason for the application being late as a timeous application could have been submitted between implementation of the legislation in June 2004 and the last few months. Mr Bennett said that Scottish Ministers had not explained or given a reason. Communities don't work in a proactive way. He couldn't believe that the Scottish Ministers wanted every Community Body to take action. He said that 15 out of 18 applications to register an interest including that of Holmehill Limited had been late. In other cases poor reasons for lateness had been given yet all had been approved by the Scottish Ministers. Holmehill Limited had a much stronger argument but was not treated in the same way. Mr Bennett suspected that the present case did not turn on its own merits.

3.      A group of local people has formed in the last 3 months to create community allotments and more land is required. "The Scottish Ministers consider that this does not address why the application was not submitted timeously." Mr Bennett did not consider this to be a reason.

4.      The community was under the (mistaken) impression that the land was held in trust for the people of Dunblane by the owners of the Hilton Hotel. This was the view of many of the older residents.... "The community body appears to have relied on the views of some of the older residents within the community, and there is no evidence that the community body had investigated these claims or sought professional advice. Had this point been pursued seriously at an earlier stage, Scottish Ministers therefore conclude that the community body's mistaken views do not demonstrate good reason for the application being late." Mr Bennett said that this was a non sequitur. It was muddled thinking to expect a Community Body to investigate every piece of land around. If so, no work within communities would be done. There was a good reason why the community held the belief that the land was held in trust. Sir Reo Stakis wished this to be the case. It only became apparent that it was not when the land had come on the market. The Director of Planning told Holmehill Limited of the detail of the agreement.

5.      The community thought that whilst the land was in the ownership of the Hilton Hotel, it would be safeguarded. "The reason for securing a timeous application is to secure a right to buy if the land is to be sold at any time in the future. A timeous application would have secured this right." Mr Bennett said that this did not address the reason given by Holmehill Limited.

6.      The land has suffered from serious neglect for approximately 2 years ...it has now become clear that the only way to maintain and enhance it was to take it into community ownership. "As the community body has been aware of the alleged neglect of the land over the past two years, this seems to support more the need for an early application rather than late." Mr Bennett said that if any community had any issue with any piece of land, registration of an interest would lead to landowners being suspicious and there would be opposition all over Scotland.

7.      The community thought that the existing minute of agreement between the owner and Stirling council protected the land in its wild state. It has only become apparent that the agreement is only enforceable by the two parties to it but no one else. "As with paragraph 4 above, there is no evidence that the community body investigated these claims or sought professional advice. Had this point been pursued seriously at an earlier stage, a timeous application could have been submitted. There is no explanation why these issues had not been pursued earlier. The fact that the community misunderstood the terms of the agreement does not address the reason why the application was not timeous." Mr Bennett said that communities could not afford to employ lawyers at every turn. If they were able to raise funds, such funds would be spent on development. Holmehill Limited had an income of £15-20,000 maximum per annum and employed no one.

 

As regards the further reason that requirement in section 39(3)(a) of the Act had not been met:

"The Scottish Ministers also gave as a reason for refusal that the requirements of section 39(3)(c) of the Act had not been met. The factors considered in relation to the public interest in that section did not demonstrate that it was strongly indicative that it was in the public interest to register the community interest. "The factors considered in relation to the public interest in that section do not demonstrate that it is strongly indicative that it is in the public interest to enter the community interest in the Register. While the aspirations of the community body, if successful, would appear to contribute positively to the local community, the Scottish Ministers have noted a number of references within the application directly relating to preventing future development on the land to be registered. There is evidence to suggest therefore that in this case the Community Right To Buy process could be used to thwart the planning process. Consequently, the Scottish Ministers have concluded that, as these issues are finely balanced, the public interest factors are not strongly indicative that it is in the public interest to approve the application."

Mr Bennett did not understand the reasoning of the Scottish Ministers. He said that the application was concerned with commercial development with low impact on the land. The area was designated as greenspace and Holmehill Limited's intention was to re-enforce the planning process rather than to thwart it. A housing development would be a thwarting of the planning process. 13/27 was Guidance prepared by the Scottish Executive. At page 12, para 30 - it stated that "a right to buy may also be refused where there is evidence to suggest that the Right to Buy is likely to be used to subvert the public interest. For example, to thwart the planning process." Mr Bennett said that there was no evidence to indicate that the planning process would be subverted by the application by a Community Body to register an interest. In the local plan dated 1999 Holmehill is designated as a greenspace. Any individual could make a planning application for a piece of land. The application was concerned with sustainable development and was not "not in my backyard".

In cross-examination by Miss Poole for the First Respondents, Mr Bennett said that he first became aware of the land being on the market for sale around the beginning to the middle of December 2004. He passed by the land every day. There was a period of two months after the land went on the market for sale to the making of the application dated 18^th February 2005. The local press in the case of Park of Keir had discussed the right to buy, not an application for registration of the community interest. 12/15 was a local community plan for Dunblane dated 2003. Details of some of the action to be taken were found at page 9 including Priority 4 improving public access to Holmehill and a campaign to raise awareness of the natural and archaeological significance of Holmehill and its designation for community use. The Community Body had been concerned about the neglect of Holmehill for approximately 2 years. Vehicles belonging to the Hilton Hotel had damaged field drains. Mr Bennett accepted that some Community Bodies had acted timeously in submitting applications to register an interest. He said that he may have had advice from Colin Gray of the Scottish Executive but could not remember. He was referred to the Guidance at page 9 para 19 "Sustainable Development requires an integrated long term approach to economic,social and environmental issues." When referred to paragraphs 23-25 Mr Bennett said that he had noted the Guidance and the Crossgates application wished to preserve the status quo while that of Holmehill Limited did not. He was not aware of asking price for the land as there was no price on the particulars of sale. The selling agents did not give him a price when asked. He thought that if the land was on the market for £750,000, this sum reflected an element of development potential. 13/9 of process was a letter 6 from Rev Fraser, which stated that he had been encouraged to hear of the community buy out campaign, which resisted the sale of Holmehill for houses or other development. Letter 7 also referred to a community buy out. Mr Bennett said the authors were not members of the Community Body. He conceded that the letters had been submitted in support of the application. He then claimed that he did not oppose building on the land. Other letters submitted with the application voiced concerns about building on the land. The only way for the community to guard against the inappropriate development of the site would be for the community to own it according to Stirling Council's Head of Planning. Mr Bennett agreed that the local plan provided protection for the land s greenspace. The Briefing Note 13/2 stated that if the land was in community ownership it would be subject to the present local plan and this would prevent the plan from being changed. Mr Bennett said that Mr Wightman had contacted him regarding the appeal.

 

Angus Hardie.

He was the director of the Development Trust Association of Scotland based in Edinburgh. He had worked for Edinburgh Council in their integration department and educational and social services in Craigmillar and Wester Hailes. He had been the director of the Development Trust Association of Scotland for 2.5 years. It was a national umbrella type of body for development trusts in Scotland and had charitable status. Its objectives were to help new development trusts to be established and be more effective. It would lobby on behalf of its members. He defined a development trust organisation as one run by people living in a community to achieve long term sustainable improvement in the quality of life of that community. Ecological, social, environmental and cultural needs would be tackled. People in the community rather than elected representatives would run such a trust. He gave an example of the Isle of Gigha Heritage Trust as a well known trust which bought out the island and was engaged in rebuilding the housing stock, providing wind turbines etc. the broad principles of the Act were known to him.

Communities might look around for land but the 'normal' community tended to be reactive than proactive. He thought that there was a generally low awareness of the Act with people having heard of it but not taking advantage of it. He agreed that not all communities were the same. He thought Dunblane to be a high capacity community of residents with a wide range of skills. The same capacity would not be expected in a 'down trodden' urban community. Issues could be difficult with fairly complex surveys, identification of sites of strategic importance and multiple registrations of interest. Part of the role of the Development Trust Association of Scotland was to advise development trusts where income to fund their activities might be obtained - from the Scottish executive, local authorities, etc. as he put it to advise where 'pots of money' existed. He opined that the level of awareness of the Act was much higher in the Highlands and Islands than in the Lowlands. He was of the view that communities might be slightly fearful of conflict with owners, which might lead to local tensions. An application to register a community interest might be regarded as hostile by owners of the land in question and accordingly, a timeous application might not be made. He said that there were 2-3 applications per week, which could take over one year to process. He had no familiarity with development trusts that had submitted applications to register a community interest. In cross-examination from Miss Poole he agreed that he had no involvement in drafting the Act. He was aware that some communities had made timeous applications.

 

John Sneddon.

He was aged 77 and had been the last senior Baillie of Dunblane Council in 1975. He returned from England in 2000 and was the community council chairman from 2002-2004. He was a member of Holmehill Limited. He had met Reo Stakis and had discussed his plans for Holmehill. He had no intention to develop all of the site but thought that the main part would be left to the council. Mr Sneddon was disappointed that this had not been done. Holmehill remained part of Stakis plc. He thought that the marketing of the land for sale and knew that the land was protected by the agreement between Stakis and Council. Mr Sneddon was wearing a badge on his lapel. In cross-examination he said that the badge he was wearing stated ' Let's Save Holme Hill'. He explained this meant to save it from becoming part of an expensive housing development. It was one of the few places left to turn into a public park and was the crowning aspect of Dunblane. He knew that Reo Stakis had had strong views on it.

 

Andrew Wightman.

He was aged 42 and described himself as an independent expert writer on land issues. He gave advice and was available to consult. He had written two books on ownership of land in Scotland and land reform. He had produced "hundreds" of papers on land reform. He had delivered the John MacEwan lecture on land reform in 1999 at the Edinburgh Festival and argued that politics, power and the public interest were essential elements of a land reform programme. Political parties had land reform on their agenda after the 1997 election. There were land reform policy group proposals prior to the establishment of the Scottish parliament in May 1999. He was one of four directors of the Caledonia Centre for Social Development and a discussion paper was produced in January 1998. He took as a model land reform and redistribution in South America. In Scotland he was concerned with land tenure reform, redistribution of land rights and land use. He regarded himself as an expert on land reform. He was referred to no.17 of the pursuers' productions which was an analysis by him of the Land Reform White Paper dated August 1999. In this he sought to articulate to the public, community groups, Nalgos, etc. and understanding of what the White paper was trying to do. In November 1999 the Scottish Ministers had sought views. In 18 was his briefing note on the ministerial statement of Jim Wallace MSP. Reference was made to the need to avoid cherry picking by community bodies and the need to register an interest in advance. The legislation had to be perceived as fair. He was also referred to his third analysis dated 14^th March 2001. He said that the idea of these analyses was that influential people could come to an informed judgement. In the White Paper of July 1999 there was no proposal for registration of a community interest after land had been exposed to sale. The draft Bill introduced the idea of registration. A community body had to register its interest in land in order to have a right to buy. Mr Wightman had argued that it was unreasonable not to allow for late registration after the land had been exposed to sale. He gave the example of the Great Cumbrae Island. It was unreasonable to register an interest in the whole island. A provision for late applications was announced in the draft bill. The right to buy was extended over the whole of rural Scotland and was not restricted to those who lived and worked on the land in question. It did not apply to communities with a population over 3000. Accordingly, Dunblane would not have been included. The scope of the legislation was extended to 10000 or less. He had thought the threshold of 3000 to be restrictive. He had meetings with Labour party politicians to increase this threshold. The Act received Royal Assent on 14^th June 2004. He was a member of the Scottish Land Fund Committee, which has authority to take decisions on the allocation of lottery money to assist communities to purchase land. He said he was particularly "angered" at the decision of the Scottish Executive to go to Assynt rather than promote Part 2 of the Act, the Right to Buy, to other communities and encourage them to use the Act. If communities left it too late they would lose their Right to Buy. Jim Wallace, MSP, the Minister concerned, had said:

"Our general approach is to encourage communities to take time to prepare before land comes on the market, as land ownership is an onerous responsibility. However, we recognise that there may well be circumstances where the idea of community purchase only arises when the opportunity unexpectedly presents itself. Therefore, we will add a procedure for Community Bodies to apply on an exceptional basis to register interest after land comes on the market."

He had had no contact with Holmehill Limited but noticed that its application had been disallowed. He looked at decision to refuse. He thought that the Application was well thought out. He thought that Mr Bennett had contacted him. This was the first decision to refuse an application, which was not based on technical grounds, according to Mr Wightman. The position of the Scottish Executive was that the legislation was to affect rural land being land in small towns and the countryside. On 28^th August 2003 there was a consultation announcing the raising of the threshold to 10,000 and asking for views. This was approved in April 2004 and came into force with the passing of the Act. He said that if someone was interested in the topic he might have made enquiries. He thought that there was no direct connection between an application to register an interest and the planning process. The planning process in this scenario has not been thwarted. The application of Holmehill Limited was the 16^th. He had looked at the previous 15 applications and none had been rejected under section 39(3) of the Act. He concluded his evidence in chief by declaring that no one had written as much as he had on land reform in the last ten years. In cross-examination by Miss Poole he said that there was relatively little public money available for the community Right to Buy. Community Bodies can apply to the Land Fund for up to 75% of funding. There are 3 cases where the right to buy has been exercised. Mr Wightman conceded that he had never given evidence as an expert witness before. His degree was in forestry and he had no legal or professional qualifications. He was not a member of the Land Policy Group. He took no part in the drafting of the legislation and did not administer the system of the Right to Buy. He had no involvement with planning but was familiar with the broad outline of planning system. He was one of hundreds of respondents to the consultation process. He had wished for a public right of pre-emption throughout Scotland including, perhaps not surprisingly, domestic gardens. He agreed that the Holmehill Limited application was not the only one to be rejected under section 39 of the Act and that there had been an application refused for the reason that the Community Body had reacted to a sale. He did not accept the fact of land going on the market as being unlikely to constitute exceptional circumstances. In cross examination from Mr McIlvride, when asked if a Community Body from at least August 2003, using reasonable diligence by consulting the various papers, would have known that communities of under 10,000 could register an interest, Mr Wightman replied that his father took an interest in these matters and his father did not know.

 

Richard Frew.

He was the only witness for the Scottish Ministers, was aged 40 and the Head of the Land Reform Branch of the Scottish Executive. This branch administered the community Right to Buy. He had been a civil servant since 1983 and had started in the Land Reform Branch in April 1999. His specific role was to deliver and co-ordinate the Land Reform Bill through parliament and particularly part 2 of Bill. He had delivered a couple of seminars to senior colleagues, given instructions to parliamentary counsel to tell them what had to be in the Bill and had to go through 3500 responses in the consultation process. He had communicated with Mr Wightman for six years and said that he had responded and had a lot of knowledge on land ownership and related issues. Mr Frew was part of the briefing team, which supported and advised ministers. He had face to face discussions with ministers discussing the intention of the policy. The job of civil servants was to advise ministers. There would normally be contact with a Community Body prior to the application being made. Section 34 of the Act required that the Community Body must contribute to sustainable development of the local community. Its memorandum and articles would be checked before allowing the application. Once the application was received an internal team of four civil servants and Mr Frew would discuss it and ensure that it was following the intention of the Act and also the wishes of the Scottish Ministers. After formal checks were carried out a copy of the application would be sent to the landowner. Once he had responded, all the information surrounding the application would be considered by the team and a recommendation would be made to the Scottish Ministers. No one had more involvement with the community Right to Buy than Mr Frew. There had been 19 late applications and 9 timeous. Of the late applications, 9 had been refused or were unsuccessful. If an application were purely reactive to a sale, it would not satisfy the criterion. Houston was a case where the application had been rejected as reactive. The Park of Keir application to register an interest was received after that of Holmehill Limited in May 2005. It was rejected by the Scottish Ministers but was not taken into account with the application of Holmehill Limited. Each application was considered on its own merits. It was possible for two Community Bodies to submit applications in respect of the same land. The purpose of the Community Right to Buy was to provide opportunities for communities to register an interest and to buy if the land comes to be sold. This Right to Buy took precedence over any other purchaser and empowered Community Bodies to a great extent. There was a two stage process with registration separate from the Right to Buy. It was felt that community ownership was a way of diversifying land ownership, which would be beneficial to Scotland as a whole. Community involvement could create a higher level of local economic prosperity with husbandry and general development of land. He was referred to 13/32 of process the Land Reform Policy Group Recommendations for Action dated January 1999. At page 8 the criteria for selection of areas affected by the proposed legislation was stated to be 'that they consist predominantly of remote fragile communities in need of special help and attention'. The intention of the legislation was 'to remove barriers to sustainable rural development.' The Community Bodies 'would have to demonstrate that they were representative of and supported by the local community, had the sustainable development of that community as their primary object, and were properly constituted.' A white paper had introduced the idea of registration of a community interest. This would allow time to assess the position before the land was put on the market. If there was no registration, Mr Frew said that the whole rural land market could be affected and there could be claims for compensation from affected landowners. The legislation created a real opportunity for Community Bodies to be landowners as owners must first offer the land for sale to the Community Body if it has registered an interest. He said that Community Bodies must have "serious intent" to buy. It was still possible for them to buy in the open market if their interest was not registered. Mr Frew said that late application to register interest were not the preferred option of the Scottish Ministers. The rules relation to late applications should be more strict. In the foreword to the Draft Land Reform (Scotland) Bill, 13/33 of process, Mr Wallace stated that there was 'added a procedure for Community Bodies to apply on an exceptional basis to register an interest after land comes on the market.' At para 4.30 'Community Bodies would be allowed to apply on an exceptional basis to Ministers to register an interest after land has come on the market...' Mr Frew said that he took into account when dealing with late applications, firstly the criteria in sections 34 and 38 of the Act and then section 39. He also took into account matters not mentioned in the Act such as landowners comments, comments from any other party and other relevant information. It was the intention of the policy to take the word 'exceptional' into account for a Community Body to demonstrate why the application was late. Mr Frew and his team make recommendations to the Scottish Ministers that the criteria have been met. If not satisfied, Mr Frew and his team recommend rejection. Mr Frew recalled having a discussion with Mr Wightman between 17^th and 20^th January about the effect of applying late application provisions. He had explained some on the reasons, which were likely to be acceptable. Mr Frew was of the view that the application of Holmehill Limited met the criteria of sections 34 and 38 criteria but not those of section 39. Mr Frew was not satisfied that the reasons given by Holmehill Limited for the application being late were good reasons. The application appeared to be reactive to the sale of Holmehill rather than an attempt to submit a timeous application. Section 37 of the Act provided the registration process so that Community Bodies would focus on the land they needed rather than land, which happened to come on the market for sale. He was referred to 13/20 of process, the Notice by the Scottish Ministers under section 37(17) of the Act.

1.      In the last few months, the Trust has been occupied with work on flood-damaged areas of the town. "While the Scottish Ministers appreciate the importance of this work, this is not an appropriate reason for the application being late as a timeous application could have been submitted between implementation of the legislation in June 2004 and the last few months." Mr Frew did not regard occupation with flood damage as a good enough reason. If there had been serious intent to register an interest, it was possible for the Community Body to have done this at same time.

2.      The community has only recently become aware of the new legislation. "While this may be the case, the legislation was commenced in June 2004, following 5 years of public consultation. The Scottish Ministers believe that this is no longer an appropriate reason for the application being late as other community bodies have submitted timeous applications." He did not regard recent awareness of the legislation as a good reason because it was not policy to allow late applications through ignorance of the law. If so, any Community Body could use this as an excuse. If the priority over application to register an interest was work on flood damage, the Community Body must have been aware of the legislation. Someone from Dunblane had participated in the consultation process. 13/35 of process was a list of respondents to the draft Bill from Dunblane. The national press had showed a lot of interest in the legislation. The Depute Minister had visited Crossgates to mark the first two Right to Buy approvals. There had been a launch in Falkirk and there had been requests for guidance throughout Scotland. The main promoters were Highlands and Islands and Scottish Enterprise. Mr Frew said that he would be surprised if not one member of the Community Body was aware of the legislation.

3.      A group of local people has formed in the last 3 months to create community allotments and more land is required. "The Scottish Ministers consider that this does not address why the application was not submitted timeously." He did not believe that the reason for allotments needing more land was a good reason to prevent a timeous application.

4.      The community was under the (mistaken) impression that the land was held in trust for the people of Dunblane by the owners of the Hilton Hotel. This was the view of many of the older residents.... "The community body appears to have relied on the views of some of the older residents within the community, and there is no evidence that the community body had investigated these claims or sought professional advice. Had this point been pursued seriously at an earlier stage, Scottish Ministers therefore conclude that the community body's mistaken views do not demonstrate good reason for the application being late." Mr Frew said that had the Community Body had been serious about registering an interest, it could have sought professional advice regarding the status of the land and the application could have been timeous.

5.      The community thought that whilst the land was in the ownership of the Hilton Hotel, it would be safeguarded. "The reason for securing a timeous application is to secure a right to buy if the land is to be sold at any time in the future. A timeous application would have secured this right." The fact that the Community Body thought that the land was safeguarded for the community was not a good reason as the Community Body needed to apply for registration in case the land came up for sale to safeguard the right to buy.

6.      The land has suffered from serious neglect for approximately 2 years ...it has now become clear that the only way to maintain and enhance it was to take it into community ownership. "As the community body has been aware of the alleged neglect of the land over the past two years, this seems to support more the need for an early application rather than late." The awareness of the Community Body of neglect of the land for two years, in Mr Frew's view, supported the need for making a timeous application.

7.      The community thought that the existing minute of agreement between the owner and Stirling council protected the land in its wild state. It has only become apparent that the agreement is only enforceable by the two parties to it but no one else. "As with paragraph 4 above, there is no evidence that the community body investigated these claims or sought professional advice. Had this point been pursued seriously at an earlier stage, a timeous application could have been submitted. There is no explanation why these issues had not been pursued earlier. The fact that the community misunderstood the terms of the agreement does not address the reason why the application was not timeous." The Community Body did not investigate or seek legal advice on the existing agreement. The misunderstanding of a Community Body could not be a good reason. Any Community Body in future could say this, according to Mr Frew.

 

Mr Frew confirmed that the Scottish Ministers had approved the letter sending out the Notice. Mr Frew and his team would explain the content of the Guidance to Community Bodies, landowners and any other interested party. He had had telephone conversations with Holmehill Limited. He referred to the Guidance at paragraph 50 where it was stated that the Community Body should demonstrate serious intent to purchase any land subject to its registration. This was the policy intention. The landowners' views expressed in 13/19 of process were considered along with their view that there was not significantly stronger support of the community in the context of a late application and the public interest. All the criteria set out in section 39 of the Act were considered. Mr Frew said that the planning system was already there to prevent development that was not compatible with the public interest. The policy intention was not to allow Right to Buy to subvert the planning system. Sustainable development of the community had longer term consequences. The objective of land reform was stated in the Policy Memorandum to the Bill, 13/25 of process, as 'removing the land based barriers to the sustainable development of rural communities'. In the Guidance at paragraph 19 'sustainable development requires an integrated long-term approach to the economic, social and environmental issues. At paragraph 30 it is stated that 'A Right to Buy may also be refused where there is evidence to suggest that the Right to Buy is likely to be used to subvert the public interest. For example, to thwart the outcome of the planning process.'

The letter of 15^th February 2005,13/15 of process, confirmed that Scottish Ministers were content that the main purpose of Holmehill Limited was consistent with furthering the achievement of sustainable development. Along with the application were submitted documents, which bore references to preventing future development. On page 14 of the application under 'Landscape' Mr Frew took the reference to section 75 agreement where the land 'shall never be used except as public pedestrian areas and public open spaces' as meaning that Stakis could not undertake or allow 'to be erected any additional or new buildings' as indicating where Holmehill Limited was "coming from". In the briefing note, 13/2 of process there was reference to measures such as the local plan and section 75 agreement protecting Holmehill from development. The docket on the rear of the public petition saving Holmehill from development was also taken into account along with the letters of support, 13/9 of process. Mr Frew thought that the application in itself was a strong one and had it been timeous under section 38 a different decision may well have been reached. However, the public interest requirement of section 39 did require consideration of the references to protection from development particularly under the 'landscape' heading. The representations of the landowners in 13/19 of process were also considered along with the guidance and policy. The references to preventing development which were part of the application and of the documents lodged in support of it shifted the balance between the aspirations of the Community Body and the subversion of the planning process. He was asked about the need for a significantly greater level of support than the 10 per cent normally required under section 38 although this was not a ground for refusal of the application. The reason for this was that Holmehill Limited themselves and the First Respondents had put this in issue. To succeed under section 39 all the conditions of section 39(3) had to be met. Holmehill Limited were seeking not only a quashing of the decision to refuse the application but also the remedy of registering its interest in the land. Mr Frew said that as there was sufficient evidence to warrant a refusal under section 39(3)(a) and (c) it was not necessary to found on section 39(3)(b). Although 19% supported the application from this figure were deducted those who had supported the prevention of real estate developments as, according to Holmehill Limited, this was not the intention of the application. The net figure, allowing for there being 6670 persons on the full register, amounted to 13.2 %. Although the view was that this was not significantly greater than 10 %, the Scottish Ministers did not include this in their reasons.

Mr Campbell cross-examined Mr Frew. Mr Frew confirmed that the decision to remove some of the signatories was taken after a conversation between Mr Gray and Mr Bennett. Copies of the removed sheets were placed before the Scottish Ministers however. The application and all supporting papers were placed before Mr McDonald the Minister for Environmental and Rural Development. The document containing Mr Frew's recommendation was not before the court because there was no requirement in the Act to place such document on the register and also because there should be frank discussion between the Ministers and their civil servants. He agreed that there was no mention in the refusal notice of the prevention of real estate development being a reason to refuse. There was nothing in the legislation that said if a Community Body wanted to prevent real estate development Ministers shall refuse the application. The requirement was that Ministers needed to be satisfied that registration was in the public interest. The Guidance gives an indication of what may be in the public interest. It was necessary to treat each application on a case by case basis. In advising the Minister Mr Frew set out his views on public interest in the Guidance and also taking account of the policy of Ministers past and present. In the present case he had concluded that although the aspirations of Holmehill Limited under section 38 were good there were particular difficulties with section 39 as the application was late. Mr Frew told the Minister that on the basis of Scottish Ministers' policy and the Guidance it was not in the public interest to approve if the application was to subvert the planning process. From a number of references within the application, he had concluded that one of the ambitions of Holmehill Limited was to subvert the planning process. He was not satisfied it was not one of their ambitions. He did not accept that he had breached an agreement between mr Gray and Mr Bennett by presenting to the Minister part of the documentation submitted with the application which part had been agreed to be withdrawn. The criteria in Section 39(3)(a)(b) and (c) were considered collectively. The Minister had to look at (a) and (b) and (c) and make a judgement having considering each of them. It was suggested to Mr Frew that some of the views expressed in the documentation submitted along with the application were not those of Holmehill Limited but he was of view that as they had been included they had to be taken into account. The authors of the letters of support might not have been members of Holmehill Limited. He agreed that there was no other evidence before the court Holmehill Limited's ambition was to prevent building development on the land. He agreed that the court was not concerned with the subsequent stage following upon a successful application for registration where the Scottish Executive would appoint a valuer to carry out a valuation in 6 weeks and then the Community Body would have 28 days to submit an application for the Community Right to Buy. Mr Frew took into account the effect of an application as provided the opportunity for the Community Right to Buy. Neither he nor the Minister considered the local plan when dealing with the application. Mr Frew thought it was reasonable to assume that the comments against real estate development were endorsed by Holmehill Limited. I an application is registered there is the potential for a Community Body to proceed to the Right to Buy which is a powerful tool as the Community Body would have control of the land use, once purchased. There had been no application for development on the land before Mr Frew or the Minister. There was no planning issue which could be frustrated at this time. It was not necessary for Mr Frew to look at the local plan as the question was whether the application could be used in the future to prevent real estate development. He was referred to 13/35 of process, a policy memorandum which made it clear that the powers of local authorities were not to be affected by the Community Right to Buy. He did not concede that he had made a mistaken judgement about the ambitions of Holmehill Limited. He agreed that in the application the aims were consistent with the sustainable development of the community. There were beneficial aspirations. He agreed that the Act did not refer to exceptional circumstances but good reason. In determining 'good reason' there had to be 'exceptional circumstances' as that was the policy set out by Scottish Ministers. There was nothing in the Guidance to say that a lack of awareness of the legislation might not be regarded as a good reason. The decision latter had been drafted and revised by Mr Frew and his team. If application for registration after the Act came into force of 18, 16 were late. The application of Holmehill Limited was number 16. Mr Frew said that it was to be expected that there would be more late than timeous applications after the new legislation was passed. It had not been agreed with the Ministers that applications would be penalised if late because of not being aware of the legislation. About April 2005, Ministers had agreed that the time had come when people should have been generally aware of the legislation. There was no exact date agreed but Mr Frew did have a discussion with Ministers whether ignorance of the legislation should no longer be reasonable. After 18 applications, the next 10 were timeous except one. Only 2 were rejected because they were reactive. Mr Frew was not satisfied that the application would not be used to circumvent the planning system. Once registration was approved a Community Body could affect development by purchasing then not developing. There did not need to be a developer in existence for the planning process to be safeguarded. The Park of Keir application from a Community Body in Bridge of Allan had been rejected as Bridge of Allan was treated as part of Stirling where the settlement exceeded 10,000. The assertion by Holmehill Limited that a body of people in Dunblane interested in allotments had just been discovered was worth considering as a good reason for the application being late but in the context of whole application it was not. The mistaken views of the Community Body were not good reasons for the application being late as the onus was on the Community Body. Mr Frew recalled a discussion with Mr Bennett regarding reasons. His role was to give guidance not advice. Applicants could have regard to the policy memo, the Act, the Guidance and Internet. Mr Frew said an applicant could look at other applications which had been granted and see what were good reasons but he had also said that each application was taken on its own merits.

In re-examination Mr Frew said that he was authorised to speak on behalf of Scottish ministers regarding this case. The policy since November 1999 was in favour of timeous applications. Late applications would be considered only on an exceptional basis. He had applied the criteria expressed in the Act. Good reasons and the public interest tests were applied on a case to case basis. Being reactive to a sale was not a good reason under section 39(3)(a). The effect on the land market was taken into account. Registration affected the land market and prices. It was not the intention of the legislation according to Mr Frew to allow a Community Body to purchase land simply because it had come in the market. Mr Frew had given Mr Bennett examples of action taken by the Community Body before land was put up for sale such as holding a public meeting and taking steps to properly constitute a Community Body to secure a timeous application.

 

THE COURT'S APPROACH TO THIS APPEAL.

 

In Chapter 6 of the Act, Section 61, sets out the provisions for appeal. 

...

(2)A community body may, by summary application, appeal to the sheriff against-

  

(a) a decision by Ministers that its community interest is not to be entered in the Register;... 

 

(5) The sheriff in whose sheriffdom the land or any part of it is situated has jurisdiction to hear an appeal under this section.

 

(7) The decision of the sheriff in an appeal under this section-

 

 (a) may require rectification of the Register;

 (b) may impose conditions upon the appellant;

 (c) is final.

 

The Act is silent upon the criteria, which are to be applied in such an appeal.

Mr Campbell submitted that in terms of Section 61 the Sheriff's discretion in determining an appeal is not confined to procedural matters and was a merits review. In the draft Bill, 13/33 of process, cl. 68(6) read

"An appeal...may be made only on one or both of the following grounds (i) that the procedural requirements set out...above were not complied with by Ministers; (ii) that Ministers have proceeded on an erroneous basis that the land was not registrable land;"

 

Accordingly, he argued that appeals were initially to be confined to procedural issues but this was changed by Parliament. There was no statutory warrant for the approach of the Scottish Ministers. Many enactments adopted the same approach; some such as the Licensing (Scotland) Act 1976, s. 39(4); Civic Government (Scotland) Act 1982, s. 64(4) and Sch. 1, para 18(7), Sch 2 para 24(7); Licensing of Venison Dealers etc, Order 1984, art 4(7) limit the scope of appeals to issues such as breaches of natural justice, incorrect material facts or the unreasonable exercise of discretion. Some such as the Coast Protection Act 1949 s. 13(3)(c) only allow a Sheriff to grant such appeals where certain works have been done. An "open" appeal such as this one, may be contrasted with a "judicial review type" of appeal, where grounds are confined to such matters as the taking into account of irrelevant material, or vice versa, or actions ultra vires, or irrationality. Each case should turn, in the first place, on what the statute says. In this appeal, he argued that, because of the open language used, and the changes between draft and final versions, that the intention of Parliament was to allow a Sheriff, if so minded, to look at the whole circumstances of the case. Sheriff Macphail in Carvana v Glasgow Corporation 1976 SLT (Sh Ct) 3 and the Court of Session in Rodenhurst v Chief Constable, Grampian Police 1992 SC 1 suggest that an appeal would be an "open" appeal, unless the language of the statute says otherwise, by confining an appeal to specific grounds or a consideration of limited facts or matters. In this case, the Act does neither. Mr Campbell argued that the same approach is taken to appeals from administrative decisions to Magistrates Courts in England. Therefore, the Sheriff hearing an appeal may look at the entire merits of the case, and the procedures adopted, and may decide for himself whether the reasons for rejection of the company's application to register a community interest are lawful.

Miss Poole and Mr McIlvride agreed that while the Act provides that there is a right of appeal against the decision of the Ministers it does not specify the scope of the appeal or the powers of the sheriff to interfere with the act or decision. They agreed that there is no authority on the extent of the appeal under Part 2 of the Land Reform Act 2003. Both agreed that the approach, which the court ought to apply, is correctly analysed in MacPhail, Sheriff Court Practice, 2^nd Ed 1998, at para. 25.11.

 

I am of the view that, while the Act provides no guidance as to the approach to be adopted by the court in this appeal, it does not follow that because limitations to the scope of appeal, (errors in respect of procedural requirements matters and in respect of the land being registrable), were considered at an earlier stage in the passage of the legislation through parliament, that this appeal must be "open" in the sense given to it by Mr Campbell. In one of the cases to which he referred me as authority for the proposition that an appeal would be an "open" appeal, the language of the statute concerned did provide an unrestricted right of appeal. In Carvana v Glasgow Corporation 1976 SLT (Sh Ct) 3 the appeal to Sheriff Macphail was under section 95 of the Glasgow Corporation Consolidation (General Powers) Order Confirmation Act 1960 which section gave a right of appeal to the sheriff against refusal, revocation or suspension (of a street trader's licence). Section 95(2) of the 1960 Act specifically provided that "the sheriff may make such order confirming, varying or reversing the decision of the magistrates' committee ..." It was held that the sheriff was empowered to act in his administrative capacity and to substitute his own opinion for that of the magistrates if he was satisfied that their decision had been wrong, although he should pay due regard to their competence in arriving at their decision. In that case reference was made to Lord Goddard C.J. in Stepney Borough Council v Joffe [1949] 1KB 599 at 602,603, where there was an unrestricted right of appeal, "That does not mean to say that the court of appeal, in this case, the metropolitan magistrate, ought not to pay great attention to the fact the duly constituted and elected local authority have come to an opinion on the matter, and it ought not lightly, of course, reverse their opinion. It is constantly said (although I am not sure that it is always sufficiently remembered) that the function of a court of appeal is to exercise its powers when it is satisfied that the judgement below is wrong, not merely because it is not satisfied that it is right."

It follows that I have to have regard to the decision of the Scottish Ministers even if this appeal involves an unrestricted right of appeal. I am not of the view that the appeal in this case should be 'open' in the sense that I may from the outset treat the application de novo by disregarding the reasons given for the decision of the Scottish Ministers and proceeding to ascertain the facts surrounding the application in order to make a fresh decision. Even if I were to do treat the application de novo, following the above authorities, I could not lightly reverse the decision of the Scottish Ministers, who are duly constituted and elected and I would have to be satisfied that the decision was wrong not simply that I was not satisfied that it was right. I am also persuaded that if this were an "open" appeal in the sense used by Mr Campbell, I could look at the whole evidence presented and make a decision to allow or refuse a late application in terms of section 39. To do so would involve me in exercising my discretion in a matter within my local jurisdiction in determining what are 'good reasons' for the late application and what is in 'public interest'. I would be substituting my opinion for that of the Scottish Ministers. Further, this would not sit well with ensuring consistency of decision making throughout Scotland and I do not believe that this is the proper approach. This discretion is best left to elected representatives such as the Scottish Ministers, who are in possession of relevant information and who are charged with exercising such discretion in respect of late applications made throughout Scotland in terms of section 39.

In MacPhail, Sheriff Court Practice, 2^nd Ed 1998, at para. 25.11, where the absence of recent authority on this question is commented upon, it is suggested that, in cases such as this appeal, where the sheriff's powers are not precisely defined, "The sheriff should not interfere with the decision under challenge unless he is satisfied either that it contravenes the Wednesbury principles or that, on a consideration of its merits, it is plainly wrong." I was referred to cases in which the sheriff's powers in such an appeal were considered. In Allen & Sons v Munro 1909 SC 70, Lord Low at 76 stated where there was an appeal to the sheriff which was under summary procedure, as in this appeal, "The Sheriff is not to act in a judicial capacity in the ordinary sense; he is not to decide a question of law between the parties; he is not to review the determination of the Magistrates, in the sense of weighing considerations for and against, and deciding to which side the balance inclines. He is not entitled to interfere except in the one case where he is satisfied that the Corporation have not reasonably exercised their discretion under the Act." In Small v Commissioners of Police for Dundee 1888 12 R 123, where the appeal of a decision of Commissioners could be either to the sheriff or either division of the Court of Session at 126 in the Second Division, the Lord Justice Clerk with the concurrence of four judges stated " The appeal is against this non-approval by the Commissioners of the plans as they stand and the question is whether we can interpose our authority and approval in place of that of the Commissioners. Now, if a case had been made of the Commissioners having gone materially wrong as to the mode which they took of reaching the decision they came to, or if they had done any other injustice, by not hearing the parties for instance, I do not say, if specific averments to that effect had been made, that we might not have interfered. But I need hardly say that without a very strong case we cannot interfere and substitute our judgement and approval for the judgement and approval of the Commissioners. The Legislature, I think, presumed special information and capacity on the part of the Commissioners." It would follow that I would be bound to follow this approach in such an appeal. Similarly, where an appeal of a planning decision was considered by the First Division, the Wednesbury principles were approved in Wordie Property Co. Ltd.v Secretary of State for Scotland 1984 SLT 345, at 347 Lord President Emslie stated "There is, and now can be, little dispute as to the scope of such appeals as these for the law is well settled. A decision of the Secretary of State acting within his statutory remit is ultra vires if he has improperly exercised the discretion confided to him. In particular it will be ultra vires if it is based upon a material error of law going to the root of the question for determination. It will be ultra vires, too, if the Secretary of State has taken into account irrelevant considerations or has failed to take account of relevant and material considerations, which ought to have been taken into account. Similarly it will fall to be quashed on that ground if, where it is one for which a factual basis is required, there is no proper basis in fact to support it. It will also fall to be quashed if it, or any condition imposed in relation to a grant of planning permission, is so unreasonable that no reasonable Secretary of State could have reached or imposed it." The Lord President went on to say that these propositions were amply vouched by inter alia, Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1KB 223. I am of the view that this is the proper approach to be adopted by me in considering this appeal. I am of the view that the merits may be considered by me in order to satisfy myself whether the decision appealed against is plainly wrong. There would need to be a very strong case for me to interfere and substitute my judgement for that of the Scottish Ministers as parliament has presumed special information and capacity on their part. It is not enough that I might have reached a different decision on the same facts. Allen & Sons v Munro; Small v Commissioners of Police for Dundee, supra.

In any event, the pursuers in their pleadings on record and Mr Campbell in his conduct of the hearing and his submissions on their behalf appear to have accepted that the Wednesbury principles are appropriate to this appeal.

 

 

REASONS.

The starting point for my consideration must be the decision of the Scottish Ministers which is challenged by the pursuers. The question for me is whether the Scottish Ministers have acted unlawfully in deciding there were insufficient 'good reasons' why the community body did not apply for registration prior to the land being marketed and in deciding that the factors bearing on whether it was or was not in the public interest to register were not 'strongly indicative' that it was.

In order to apply the proper approach I require to have regard to the reasons for refusal of the application advanced by the Scottish Ministers in the decision letter and, in turn, the reasons advanced by the pursuers for making the late application. I do not intend to repeat much of the evidence in this appeal, which evidence I have detailed above.

It is accepted that Mr Frew in giving his evidence was doing so as the alter ego of the Scottish Ministers. Carltona Ltd v Commissioner of Works [1943] 2 All ER 560. In the words of Lady Smith in Somerville v Scottish Ministers 2005 CSOH 24, "The Carltona principle is to the effect that the duties of government ministers whilst exercised under their authority are normally exercised by officials in their department and the decision of any such official is thus constitutionally the decision of the minister. In short, when a minister is entrusted with administrative, as distinct from legislative, functions he is entitled to act through and by any authorised official of his department."

Mr Frew was satisfied that the application complied with the criteria set out in section 38 of the Act. Mr Frew accepted on behalf of the Scottish Ministers that, had the pursuers submitted the application timeously, that is before the land was exposed for sale, the Scottish Ministers would probably have registered it. This appeal concerns the additional criteria found in Section 39 of the Act.

Having regard to the decision letter, I was referred to a number of authorities, which indicate that decision letters are not to be construed as statutes and must be construed benevolently and as a whole. Excessive legalism is to be discouraged and it is the substance of reasoning rather than skill in draughtsmanship which is to be tested. Save Britain's Heritage v Number 1 Poultry Ltd 1991 1 WLR 153. "The reasoning must not give rise to a substantial doubt as to whether the decision-maker erred in law, for example by misunderstanding some relevant policy or some other important matter or by failing to reach a rational decision on relevant grounds. But such adverse inference will not readily be drawn. The reasons need refer only to the main issues in the dispute, not to every material consideration....Decision letters must be read in a straightforward manner, recognising that they are addressed to parties well aware of the issues involved and the arguments advanced. A reasons challenge will only succeed if the party aggrieved can satisfy the court that he has genuinely been substantially prejudiced by the failure to provide an adequately reasoned decision". South Bucks Council and Another v Porter 2004 4 All ER 774

Miss Poole argued that the Scottish Ministers have a duty to have regard to the Guidance which is a statement of ministerial intent and should depart from it only if there are cogent reasons for doing so. R v Ashworth Hospital Authority ex p Munjaz [2005] UKHL 58. Statements in the Guidance may be persuasive authority on proper construction or application of legislation. R v Wandsworth LBC ex p Mansoor 1997 QB 953. Decisions flying in the face of the Guidance could be challenged. Accordingly, for example, the 'exceptional circumstances' approach to late applications should, Miss Poole submitted, be borne in mind by both the Scottish Ministers and the court when applying the Section 39(3)(a) and (c) tests.

I am of the view that I may have regard to the Guidance to assist me in determining whether the Scottish Ministers have acted unlawfully in refusing the application under section 39(3)(a) and (b). I am satisfied that the decision of the Scottish Ministers when applying these statutory tests was influenced by their view of the policy principles underlying the Act. 'Good reasons' and 'public interest' in Sections 39(3)(a) and (c), the matters in dispute, are not defined, and accordingly the legislature left a significant area of discretion and judgement to the Scottish Ministers. They should exercise this discretion with reference to the policy principles underlying the Act. The policy principles may be relevant, for example, in determining whether a consideration should or should not have been taken into account, whether there has been a fettering of discretion by an unlawful policy, or whether an unlawful interpretation has been placed on Section 39(3)(a) or (c).

The Purpose of the Act.

The purpose of the Act is to increase community ownership in land. The overall purpose of the Act, as set out in its long title, is to make provision under which bodies representing rural and crofting communities may buy land with which those communities have a connection. The Act should be construed in this light. The registration stage is the first step towards the exercise of the community right to buy. It should not be isolated from its end purpose. It would, accordingly, be reasonable for the Scottish Ministers at the registration stage to take account of the effect that ultimate land ownership would have.

Policy.

The policy of the Scottish Ministers is that ownership is an onerous responsibility and community bodies should plan ahead. The registration process itself is evidence of this. Although not originally contemplated, it was included in the draft bill. It must be a necessary component of registration that the community body does consider the implications of community ownership before their right to buy arises and to focus on the land in which they have an interest. Accordingly, it is not unreasonable to expect communities to plan ahead.

Serious Intent.

The issue of 'serious intent' upon which evidence was led in court is an example or aspect of this policy. Serious intent is mentioned in the Guidance in relation to various different aspects of the registration process and Mr Frew gave evidence that this was indicative of a general policy intention underlying the entire Act. The idea of 'serious intent' would seem to be in keeping with the 'plan ahead' and 'onerous responsibility' issues raised by the Minister sponsoring the Bill.

Miss Poole submitted that when considering how this policy influences the application of the Section 39(3) tests, it is relevant to consider the advantageous and powerful rights arising from registration. If the right to buy is activated, the community body is preferred above all other interested purchasers and is given six months to raise the money for purchase. If the land is purchased, then most of the money for purchase may not come from the community's own pockets, but other sources; up to 75% (or in theory 100%) from the Land Fund, and evidence was given of £2-3m given to the Holmehill Limited and Islands Community Land Unit to give grants. The money available may be significant; £1.4m was the figure given to Assynt from the Land Fund. That registration requires forethought, planning and serious intent might be seen as being proportionate to the advantageous rights it confers. General interference with the live land market to increase community ownership was rejected. One option put before the legislature was to grant an automatic right of pre-emption on all land sales to community bodies. That option was suggested by various consultees, including Mr Wightman. It was not adopted by the legislature. It was thought undesirable that the whole land market and prices should be affected, with all the attendant negative aspects, in order to increase community ownership.

Exceptional circumstances.

The policy of the Scottish Ministers is that late applications are to be granted only in exceptional circumstances. There is no automatic right for the application to be granted where community bodies have applied after land has gone on the market. If so, the position would be akin to an automatic right of pre-emption and direct intervention in the live land market. There is, accordingly, in the Act, a more restrictive approach to late applications than to timeous applications. While 'exceptional circumstances' is not to be found in section 39, the view of the Scottish Ministers as to what may count as 'good reasons' or 'strongly indicative' public interest factors is influenced by the clear policy indication that late applications should be granted only in exceptional circumstances. The exceptional circumstances basis for late applications, as opposed to timeous applications, is evidenced in the following documents: Debate on Land Reform 24 November 1999, Land Reform The Draft Bill consultation document, Guidance on the Act and HIE Guidance.

Balance of Rights.

The legislation does involves a balance of rights. While this legislation was instigated with the interests of the community in mind, the interests of landowners have now also been taken into account. The idea of a balance of rights is clear from the Policy Memo 13/25 of process para. 22. The process requires to be fair and predictable to all concerned. The legislation requires to be perceived as being fair on all parties. The requirement for registration gives an element of predictability to landowners in the marketing of their land. I could see that the element of predictability could be damaged if all late applications were to be granted.

Sustainable development.

The underlying objective of the land reform programme and the introduction of the community right to buy is the sustainable development of rural communities. Applications, which are opposed to development, are not in keeping with this underlying objective. This policy approach to development taken by the Scottish Ministers is supported by the following public documents: Land Reform Policy Group Report: Identifying the Problems (February 1998), Reform Policy Group Report: Identifying the Solutions (September 1998), Land Reform Policy Group Report: Recommendations for Action (January 1999), Land Reform Draft Bill consultation document (February 2001),The Policy Memorandum accompanying the Bill on its introduction to Parliament; Policy speech by the sponsor of the Bill, Jim Wallace, on 28 November 2001.

There are various references to sustainable development in the Act. In Section 34(4),the body buying the land must have a main purpose consistent with furthering the achievement of sustainable development. It would seem to be incompatible with this purpose if frustration of development was the true objective. In Section 38(1)(b)(ii) the acquisition by the community body is compatible with furthering the achievement of sustainable development. In Section 51(3)(c), Ministers will only consent to a community buyout if what the community body proposes to do with the land is compatible with furthering the achievement of sustainable development. The Act, accordingly, contains repeated reference to sustainable development, at stages of formation of a community body, registration, and activation of right to buy. Mr Frew confirmed that the Act does not expressly say that an application must be refused if the community body's ambition is to stop housing development.

'Good Reasons'.

 

In terms of Section 39(3)(a) of the Act, the Scottish Ministers must be satisfied that there were good reasons why pursuers did not secure the receipt of an application before the owner of the land took steps to market it. There is no definition of good reasons in the Act. I am satisfied that the wording of the Act places an obligation on pursuers to demonstrate good reasons in their application. The wording of the Section does give a discretion to the Scottish Ministers to decide whether what is stated in the application amounts to good reason. The community body must demonstrate not simply reasons but 'good' reasons. Accordingly, parliament has left this area of judgement to the Scottish Ministers. Mr Frew said that cases are decided on their own facts on a case by case basis, looking at reasons given individually and collectively. I would accept that there is no requirement for the Scottish Ministers to provide community bodies with lists of good reasons in advance. This is in keeping with retaining their wide discretion. In the view of the Scottish Ministers, what might constitute good reason has to be construed in the light of the policy background to late applications. I would accept that it is legitimate and proper for the Scottish Ministers to look at the policy background when deciding which sorts of reasons count as 'good'. I would also accept that the application of the policy principles underlying the Act should result in these principles being applied with some measure of consistency.

While recognising that the categories of reasons are not closed, the evidence was that the Scottish Ministers ordinarily will not find reasons to be 'good' within Section 39(3)(a) if they demonstrate no more than that a community body has been reactive to land coming on the market. The legislature expressly declined to adopt the course of an automatic right of pre-emption, which would be the logical consequence of allowing community bodies to be reactive to land going on the market. There is a clear policy presumption in the Act in favour of timeous applications given the provisions of Sections 38 and 39. The legislature did not adopt the position that being reactive to a sale was enough in itself. There have been nine timeous applications by community bodies at the time of the hearing and this evinces that it is possible for communities with serious interests in land to register timeously. Mr Hardie gave evidence that some community bodies are more proactive than others, and indeed cited Dunblane as the type of area that might be more proactive than others. I do not regard it as perverse or unreasonable to expect community bodies to act prior to land being marketed. I would accept that this is the policy intent of the legislation. Reasons must be better than just the community reacting to the fact of the land going on the market. Reasons for an application being late must therefore address why the application is made after the land has gone on the market, rather than amounting only to an expression of that fact.

There may be cases where good reasons are more likely to be found where there has been activity by a community showing forward planning prior to land being marketed. This is an application of the policy principle that ownership is an onerous responsibility and community bodies should plan ahead. Mr Frew gave examples of communities planning ahead by having a public meeting or creation of a company. There could be a situation where the community body was unaware that steps had been taken to market land at the time of submitting the application. In this appeal, there was no indication that any step to purchase was taken by the community prior to the land going on the market in December 2004. Prior to December 2004 there was no evidence of any intent serious or otherwise by anyone in the community to purchase the land on behalf of the community. The Act provides the opportunity for a community body to purchase land for the sustainable development of the community. The evidence was that the first time anyone in the community considered using this Act was when the land was advertised for sale. This is a factor, which the Scottish Ministers were entitled to take into account in reaching their decision. A timeous application could have been submitted between June 2004 and the date of submission, if the community had formed the intention to purchase the land.

 

The argument of the pursuers was that their reasons for failure to lodge a timeous application were good reasons and the Scottish Ministers erred in holding that they were not good reasons. As I have said above , it is not for me to decide whether I believe these reasons to be good or otherwise. The question is whether the Scottish Ministers acted unlawfully in exercising their discretion under section 39(3)(a). The arguments advanced by Mr Bennett in evidence and by Mr Campbell in his submissions concern in the main the merits of the pursuers' reasons. The Scottish Ministers' position, as I understand it, is that every one of these reasons is irrelevant to the question of why the community failed to take any steps to purchase the land prior to it being exposed for sale. Accordingly, in the exercise of their discretion and applying the policy principles, they were entitled to decide as they did.

Mr Campbell argued that the legal issue was that in deciding that the reasons advanced by the pursuers were not good reasons. The Scottish Ministers had taken into account a matter which is irrelevant and has no statutory basis, namely that there is some sort of policy presumption that communities ought to behave in a particular way, and that their applications are liable to be rejected if they do not. That is not stated by the Act or the Guidance. Accordingly, for them have assumed a presumption in favour of timeous applications, or conversely a presumption against late applications was to start the decision making process from the wrong place. That is Wednesbury unreasonable, and falls to be classified as unlawful.

In my view, the Scottish Ministers have acted within the policy principles in the exercise of their discretion. There may be a presumption against late applications or in favour of timeous applications but this is to be found in the provisions of the Act itself, which provides stricter criteria in respect of late applications. The Scottish Ministers must follow the provisions of the Act. It is not the case that all late applications must be refused. Provided the Scottish Ministers are satisfied that the criteria in sections 38 and 39 are met, a late application will be accepted. Accordingly, I do not accept that there is Wednesbury unreasonableness in this case.

Mr Campbell further argued that it was not possible for a timeous application to have been made as the pursuers' company did not exist before the land was exposed for sale and could not be aware of the legislation. The failure of the Scottish Ministers to make even that level of inquiry was a failure to consider a relevant matter and perverse. A timeous registration was not the same as a timeous application. If he is correct, the lack of a company's awareness because it was not in existence would always be a good reason for lateness as in all late cases a community could justify a late application by making sure they incorporated a new company to make it. That would not be in keeping with the policy decision not to enact a general right of pre-emption, or the principle that late applications should be granted in exceptional circumstances. I am of the view that it is the general awareness of the community and its intention to purchase that requires to be considered in this context.

As I have stated above, in looking at the reasons and rejection thereof, the question for me is whether the Scottish Ministers have acted unlawfully in exercising the discretion entrusted to them by the legislature. While there is a requirement to give reasons for the decision, I am not of the view that the Scottish Ministers require to address the merits of every suggestion made in the application form or fully answer each of the reasons provided by the pursuers or investigate the truth or otherwise of any beliefs or misconceptions .

 

In exercising their discretion under section 39(3)(a) of the Act and applying the above policy that a community should take steps to purchase the land prior to it being exhibited for sale, the Scottish Ministers did not regard any of the seven reasons provided by the pursers are being good reason for the failure to make application prior to the land being exhibited for sale. Not one of these reasons referred to any steps being taken by, or intention, serious or otherwise, of the community to purchase the land prior it being exhibited for sale. The Scottish Ministers were entitled to regard the application as 'reactive' to the sale of the land in these circumstances. Further, in reaching this decision, it was not unreasonable for them to take account of the dockets on the rear of some of the petition sheets and the correspondence lodged by the pursuers which made reference to preserving Holmehill from, presumably, housing development on the land.

Accordingly, I am not of the view that when construed in the light of the underlying policy approach to late applications adopted by the Scottish Ministers, the decision of the Scottish Ministers under Section 39(3)(a) of the Act is irrational or so unreasonable that no reasonable decision maker could come to it. There was nothing in the reasons given to show serious intention to register a community interest prior to the land coming on the market, nor anything amounting to good reason when considered in the light of the policy principles.

Accordingly I do not agree with Mr Campbell that the Scottish Ministers have erred in law in that they have wrongly declared themselves as not satisfied as to the matters set out in s. 39 (3)(a) of the Act thus vitiating their decision; the reasons given by them in the Decision Notice are unsupported by the facts admitted or proved; they have misapplied the provisions of both s. 38 and 39 of the Act; they have taken irrelevant matters into account in reaching their decision; they have left relevant matters out of account in reaching their decision; they have acted inconsistently as between this and other like applications, and have therefore purported to exercise their discretion irrationally and perversely.

Public Interest.

Having so decided it is not necessary for me to consider the approach to Section 39(3)(c) as all three subparagraphs must be satisfied for the decision not to register to be challengeable in terms of Section 39(3). Given the importance of this matter, if I had to so decide, I accept that in applying the Section 39(3)(c) criterion in respect of 'public interest' a wide test is involved with many factors. As sustainable development clearly underlies the Act, an ambition to prevent development is a factor that may be taken into account in construing public interest. The Guidance at para 30 makes it clear that applications which aim to subvert the planning process are not considered to be in the public interest; para 30. In para 24 it states that the application as a whole should be compatible with achieving sustainable development. Public interest is not defined in the Act. It is a concept that arises at more than one point in the legislation, during the registration process at Sections 38(1)(e) and 39(3)(c), and on activation of right to buy at 51(3)(d). In all these instances what is or is not in the public interest is a matter left to the discretion of the Scottish Ministers. The Guidance indicates that public interest will be determined on a case by case basis. As a minimum the applications must demonstrate that the acquisition will bring real benefits to the whole of the local community. Benefits must not be outweighed by disadvantages. Public interest involves a multitude of various, possibly conflicting, interests. It is clear from the legislation (the 'strongly indicative' test) that the public interest test is stricter in cases of late applications than timeous applications. So the factors indicative of the public interest for a timeous application to succeed might not be enough in a late application.

The public interest factor at issue in this case that was taken into account by the Scottish Ministers is attempts to frustrate development. The purpose of the community right to buy is that of sustainable development of communities. If the purpose of an application to register a community interest in land is the desire to prevent or frustrate development by a potential purchaser, I would agree that it is not unreasonable for the Scottish Ministers to take this into account and regard the application as being incompatible with the policy aims of the legislation. The effect of registration is to give a right of pre-emption over all other potential buyers to purchase land. It prevents the landowner dealing freely with the land, and any sale is subject to the procedure under the Act to allow the community to activate its right to buy. The right of pre-emption is designed to enable the community body to become owners of the land if it comes on the market. The practical effect of ownership, once accomplished, is to give the owner control over land use and a veto over development on land that the owner does not like. The community right to buy had the potential to subvert the planning process. Mr Campbell argued that the planning system is separate from the community right to buy, and planning considerations are therefore irrelevant. However, in the real world, I would think it unlikely that the planning process would be commenced or continued with, for example, in respect of an application to allow housebuilding, if the developer was aware that the land was subject to a community right to buy.

 

Significantly greater support.

Finally, while it is not the subject of this appeal, as regards Section 39(3)(b), it is a mystery, not clarified by Mr Frew, why the Scottish Ministers regarded 13.62% as being significantly greater support than 10% and did not refuse the application on that ground. However, I concede that it is for them to exercise their discretion in this respect.

 

I have certified this cause as suitable for the employment of junior counsel and have awarded expenses following success.

 

 

 

 

 

John Craig Cunningham McSherry

27^th April 2006