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The Earl of Kinnoull: I should like to support the noble Lord, Lord Northbourne. This is not a perfect

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amendment, as I am sure he will agree. The amendment which the noble Lord, Lord Carter, is about the move—I am not sure whether we are discussing it at the same time—comes back to what the industry agreed. It breaks the flexibility, the achievement of which was so heavily fought for. It took four years for the industry to agree on this matter.

One recognises the problem, but the noble Lord, Lord Carter, is simply lifting out of the 1986 Act, the 1976 Act and the 1948 Act, what are called the deadly sins. If the tenant had not committed one of those deadly sins, he was there for life. That must destroy the whole industrial agreement. I hope that some agreement on the amendment of the noble Lord, Lord Northbourne, can be sought, to show that both parties, landlord and tenant, have in fact addressed the problem.

The noble Lord, Lord Carter, is acknowledged as a great expert outside the Chamber—he was on the Northfield Committee—and is one of the leading experts in the Chamber. If he were advising the landlord, he would simply say to him, "Well, apply for a shorthold tenancy for the house and therefore escape this problem." I do not say that that is the way to solve the problem and I am not sure whether my noble friend can offer any support at all in the spirit of the noble Lord's amendment.

Lord Carter: I am extremely grateful to the noble Earl for his reference to my expertise. Of course, I defer to him in his superior knowledge of the seven deadly sins. The point of my intervention was not to say that there should be lifetime tenancies. That is an entirely different point. I am sure that we all want to ensure that where the home is central to the tenancy, there must be some means—perhaps in the way suggested by the noble Lord—to require the landlord and tenant to consider the matter. I should like to make the requirement a little stronger, but that is the nub of the argument.

4.45 p.m.

Earl Howe: I should like to thank the noble Lord, Lord Northbourne, for introducing the amendments so clearly. I recognise that he and other noble Lords who have spoken in support of them want to ensure that tenants are fully aware from the start that they will have to vacate the house at the end of the tenancy. That is the point of the amendments. It may also be sensible in some cases for the parties to make advance arrangements for rehousing the tenant, if the landlord has a house available and wants to commit himself at that stage. If the tenancy was for a long term—say, 15 or 20 years—such a commitment might not be appropriate.

However, I am not convinced that it is necessary to make that proposal part of the notice condition. I should certainly not want it to be a mandatory requirement to exchange notices where the tenancy includes a residence. Where would that place people who, by oversight, failed to exchange notices—a problem that was identified by the noble Lord, Lord Northbourne, himself. If the tenancy was not a farm business tenancy the tenant might, for example, lose his rights to compensation for any improvements.

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It is essential to keep the notice as simple as possible. If the notice is to be effective in ensuring that a farm business tenancy which complies with the necessary criteria at the beginning of the tenancy is to remain a farm business tenancy, the parties must exchange valid notices. We do not want the notice provisions to contain traps for people. That is why we have made them as simple as possible. The notices must identify the holding and make it clear that the person giving the notice—both parties have to give one—intends the tenancy to be and to remain a farm business tenancy. Surely no one will give such a notice without finding out what a farm business tenancy is and what are the implications of it.

A tenant will, therefore, be aware that he or she will have to quit the whole holding, including the house, at the end of the term. In my view there is no need for any additional provisions. I am sure that it is not in the best interests of either party, either the tenant or the landlord, to complicate the notice by adding extra provisions, even with the best of motives, as I accept the noble Lord has. Therefore, I hope that he will feel able to reflect on what I have said and withdraw his amendment.

The Earl of Kinnoull: Would my noble friend consider a printed notice where—as there is with shorthold tenancies—the back of the notice has an explanatory point stating the rights of the tenant and the obligations of the agreement? Would he consider that such information should perhaps be printed on the back of any notice that may be served?

Earl Howe: My noble friend may be right that on shorthold tenancy agreements that is generally the case. One could argue that a mechanism or a form of words along the lines that he suggested would represent good practice. But, as I said, I am inherently suspicious of the idea that we should complicate the Bill any further at the moment. I shall reflect on all the points that have been made.

Lord Northbourne: Before the noble Earl sits down, I am not entirely sure that he has dealt with my second amendment, which relates to the fact that the residential tenancy would have to be a tenancy where the notice condition applied. My argument is that the letting of a residential tenancy is so important that it should not just be done by Bill and Charlie over the gate and not be recorded in writing.

Earl Howe: I believe I said that I would not want it to be a mandatory requirement for the parties to exchange notices where the tenancy included a residence. What happens if they fail to exchange notices, either by inadvertence or for another reason? That would place both parties in a terrible trap through no fault of their own.

From what the noble Lord said, I think he will agree that his idea merits further thought. However, I do not wish him to take any comfort from that in coming back at a later stage. I feel quite strongly that, while the intentions behind the amendment are perfectly valid, it would be a mistake to build this kind of provision into the Bill.

Lord Northbourne: I am grateful to the noble Earl. I shall not press the amendment but I feel that this issue

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needs considerably more thought. I do not feel happy about the idea of it being possible to create a long tenancy with residential implications merely by word of mouth. With the proviso that I shall probably come back and perhaps would like to discuss the issue with the noble Earl, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 11 not moved.]

Lord Carter moved Amendment No. 12:


Page 2, line 16, at end insert:
("( ) Once notice has been served under subsection (4) above, the tenancy shall be a farm business tenancy for the term of the tenancy, whether or not the character of the tenancy continues to be wholly or primarily agricultural.").

The noble Lord said: We can deal with this amendment reasonably briefly because we have already covered the ground to some extent. The amendment concerns the character of the agricultural tenancy. We now have it on record that once a farm business tenancy, always a farm business tenancy, and that as long as the changes are within the terms of the notices which are changed the nature of the tenancy can change fairly drastically without altering its status as a farm business tenancy. This is a probing amendment because it uses the words "wholly or primarily". We want to get it quite clear on the record that, whether the character of the tenancy continues to be wholly or primarily agricultural, it will be a farm business tenancy more or less whatever happens.

The character of the tenancy may change substantially. There may be a golf course or a nature trail and the farm may become a mere adjunct to a boarding house or a bed and breakfast establishment. We are not here dealing with office blocks. As I said on the previous amendment, 80 per cent. of our land mass is rural. I am sure the Government hope that a good deal more of that 80 per cent. will become tenancies under the Bill. If there is an increase in tenancies, there could be a dramatic change in the nature of our countryside directly as a result of the Bill. We want to have it on the record that whether it is wholly or primarily agricultural, does not matter. Whether the character changes, once a farm business tenancy, always a farm business tenancy. Groups outside the House which are interested in conservation and in our rural structure will be very interested to hear the noble Earl's reply on this point. I beg to move.

Earl Howe: I recognise that this is intended as a probing amendment. I am pleased to be able to tell the noble Lord that the Bill as drafted already achieves precisely the result that he appears to be seeking. Under Clause 1(1) the tenancy continues to be a farm business tenancy if it meets the notice conditions and the business conditions. It does not have to comply with the agriculture condition as well. Therefore, once the notice conditions are met—that the notice has been validly served and the tenancy is primarily or wholly agricultural at the beginning of the tenancy—it does not matter whether the character of the tenancy continues to be primarily agricultural thereafter. This is precisely the point of exchanging the notices before the tenancy

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begins. It is true that the tenancy must continue to meet the business conditions, but those do not impose an onerous requirement. They require only that some part of the land comprised in the tenancy is farmed for the purposes of a trade or business. That is very far from saying that the character of the tenancy must be primarily agricultural. I hope that the noble Lord will be sufficiently reassured by my reply to withdraw the amendment.


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