SAAVA Annual Field Day discusses Amnesty Agreements for tenant farmers
Press Release 5th June 2017
Speaking at the Scottish Agricultural Arbiters Valuers Association (SAAVA) Annual Field Day in Midlothian last week, Rob Forrest, President of SAAVA, briefed Scottish valuers on the upcoming opportunity for tenants and landlords to establish Amnesty Agreements.
“Under the Land Reform Act, and starting on 13th June this year, we now have a temporary opportunity to regularise the position for existing improvements on tenanted farms,” he explained. “I strongly encourage all tenants to use this chance to get their ‘house in order’ and establish the compensation terms of any improvements made.
“Simply, we now have a 3-year window, in which landlords and tenants can agree on which improvements are compensatable when the tenancy ends. Any improvements made from this year will require the tenant to adhere to statutory procedures, which offers more clarity for all parties for future improvements.
Jeremy Moody, Secretary and Adviser to the Central Association of Agricultural Valuers (CAAV), added, “It must be made clear that the Amnesty only determines what improvements are eligible for compensation and does not agree value. That can only be established when the tenancy ends, maybe in decades, nor will it lead to any immediate payments.
“However, for existing improvements, it is a very sensible approach to gather evidence to show what work has been done to date and by whom, discussing it all with the landlord. The aim should be to seek agreement and have a signed document to define what will be compensated at the end of the tenancy, all recorded for use at the future waygo.
“This process is best pursued by the tenant and landlord, and professional support may be beneficial for objectivity and experienced advice in making sense of what can be 50 years of patchy records for a claim that may be made after a tenant’s death. Discuss improvements with an inspection of the farm, and once agreement has been reached, record the outcome on an amnesty agreement and keep with all legal papers for future reference.
“Evidence is key for this process so gather as much as possible. This can include farm maps, planning papers, information from family members and invoices – just to name a few. It may take some time, so start early and drive the process for a quick and amicable conclusion.
Mr Moody concluded: “The opportunity to establish clarity as to what is compensatable is a very positive development for landlord and tenant relations and, as good housekeeping, could save risks of future conflict and legal procedures. I highly recommend all tenants and landlords to act on this chance to agree terms, so all parties are clear on their position and effective business planning can be made with an accurate knowledge of the position.”