The commercial property team advise on an Agricultural Holdings Act

Thomson Snell & Passmore were instructed via land agents to help resolve an issue with the surrender part of an Agricultural Holdings Act 1986 (AHA) tenancy agreement of land in an estate, and a sub-tenancy (FBT) under the Agricultural Tenancies Act 1995. It was crucial to agree the surrender in order to proceed with a sale of part of the client’s estate with vacant possession under time constraints. The matter presented difficulties because the reversion to the freehold title of the AHA was split between two free-holding trusts.

Questions arose, amongst other matters, about the validity of the FBT which had been granted out of the client’s land in the AHA head tenancy, and the need for both freehold owners to be party to a surrender of that part of the AHA tenancy. The second owner was not prepared to sign the surrender and demanded that the AHA tenant surrendered its interest over the second owner’s land, weakening Wthe AHA tenant’s holding and threatening the proposed sale of the land. We settled the matter by means of a deed of covenant with the buyer of the freehold which protected our client’s future interest as against the second owner, enabling the sale to proceed.

Sue Lister (agricultural and rural property) worked on this matter to reach a good outcome for our client.