Adams, Tenant; Dunseath, Landlord (No. 2)

• Jurisdiction: Ireland
• Judgment Date: 26 July 1898
• Date: 26 July 1898
• Court: Land Commission (Ireland)

Adams

Tenant

and

Dunseath

Landlord (No. 2) (1).

Land Com.

CASES

DETERMINED BY

THE QUEEN'S BENCH DIVISION

OF

THE HIGH COURT OF JUSTICE IN IRELAND,

AND BY

THE IRISH LAND COMMISSION,

AND ON APPEAL THEREFROM IN

THE COURT OF APPEAL,

AND BY

THE COURT FOR CROWN CASES RESERVED.

1898.

Fair rent — Increased letting value — Allowance to the tenant in respect of improvement work — Balance of increased letting value — Right of the landlord thereto — Ulster custom.

(1) The tenant is entitled to a fair and liberal annual allowance in respect of the present capital value of his improvement work.

(2) In ascertaining such capital value and allowance, regard must be had not merely to the expenditure of the tenant in moneys numbered or labour, but to the skill he has employed in developing the latent resources of the soil.

(3) If, after a fair and liberal allowance has been made in respect of the tenant's improvement works, any surplus or balance of increased letting value remains, such surplus or balance is the property of the landlord, whether the holding is subject to the Ulster Custom or not.

In this case the tenant had reclaimed 16 acres of land, and the Sub-Commission having estimated the cost of such reclamation, and the increased letting value resulting therefrom made a deduction from the rent to be paid by the tenant at the rate of 5 per cent. upon the estimated cost of reclamation. This deduction did not absorb the entire increased letting value, but a balance or

surplus still remained over which the Sub-Commission divided equally between the landlord and the tenant.

The question in the present appeal was whether the Sub-Commission were right in principle in so dividing the balance or surplus of increased letting value equally between the landlord and tenant; and if not, how that balance or surplus was to be dealt with.

Serjeant Dodd (with him E. Greer), for the tenant:—

We submit that no question in the present case can arise as to the balance of increased letting value, inasmuch as the deduction allowed by the Sub-Commission in respect of the tenant's improvement work is altogether inadequate. The increased letting value, which has been estimated at between 6 and 6¹/₂ per cent., is no more than a fair return to the tenant for the work he has executed. Moreover, the Ulster Custom applies to the holding, and on an estate, where the Ulster Custom prevails, the landlord at any rate in early times never sought to exact anything from the tenant in respect of the labour or capital expended by him.

Even assuming that a proper allowance has been made to a tenant for his improvement work, and that the Ulster Custom does not apply to the holding, a tenant according to the judgments in the former case of Adams v. Dunseath (1) has an interest over and above the allowance so made to him in respect of the improvements he has affected. That interest is more than sufficient to absorb any balance of increased letting value that may remain.

Matheson, Q.C. (with him Caruth), for the landlord:—

The only question in this case is what allowance is to be made to the tenant in respect of his improvements in fixing a fair rent for the holding. The only allowance a tenant can get in respect of these improvements is a fair interest upon their original cost in so far as the original cost exists at the time of fixing the fair rent. In Adams v. Dunseath (1) the Judges all agreed that “improvements” in the Act of 1881, sect. 8, sub-sect. 9, meant the same thing as “improvements” in the Act of 1870, sect. 70, and that the

only improvements in respect of which a tenant could get an allowance in fixing a fair rent were the same improvements for which he would be entitled to claim compensation on quitting his holding. This establishes our contention that a tenant is only entitled to a fair percentage on the original cost of his improvements. If the tenant is allowed anything more than this, he is given an interest which does not exist in law, something in the nature of an occupation interest which has recently been expressly repudiated.

E. Greer, in reply.

Serjeant Dodd (with him E. Greer), for the tenant:—

Matheson, Q.C. (with him Caruth), for the landlord:—

Meredith, J.:—

In this and several other cases heard at Belfast before Mr. Justice Bewley, Mr. Commissioner Wrench, and Mr. Commissioner Fitz Gerald, the Court found as a fact that portion of the land comprised in the several holdings had been reclaimed by the tenants or their predecessors in title, and that the letting value of the portion so reclaimed had been thereby increased. The question as to the mode in which this increased letting value should be dealt with was reserved for further argument, and it has fallen to my lot to take part in the decision of the point thus reserved. The method employed by the Sub-Commissioners appears to have been as follows—They have estimated the cost of the reclamation effected by the tenants, and the increased letting value due thereto, and they have made a deduction from the rent based upon an allowance to the tenant by way of interest at the rate of 5 per cent. upon the estimated cost of the reclamation, and a further allowance equivalent to half the residue of the increased letting value. In other words, after deducting from the increased letting value a sum equivalent to 5 per cent. on the estimated cost, they have divided the surplus or balance of increased letting value equally between the landlord and...