Castle Toward & the Community Right to Buy

Castle Toward & the Community Right to Buy
Andy Whitman, Land Matters
09.02.15

The attempts by South Cowal Community Development Company (SCCDC) to acquire Castle Toward in Argyll have attracted widespread media attention. See reports here and here as examples.

Last week I was sent an email by one of those behind the acquisition. It was entitled HELP!!! and sought my assistance in trying to resolve the current impasse between the community and Argyll and Bute Council. Alas, I have no magic wand and replied to say that, while I had been following the story, I did not know enough of the detail to provide any advice or assistance. Matters might not have proceeded any further but something was niggling at the back of my mind. I decided to find out the factual details behind the case.

Background

SCCDC first applied to register an interest in Castle Toward under Part 2 of the Land Reform (Scotland) Act 2003 (the community right to buy) in January 2011.(1) This application was rejected by Scottish Ministers because it was “late”. In other words, steps were already being taken to market the land and, as stated in the letter, “Ministers have previously stated that being reactive to a proposed sale of land for specific purposes is not a “good” reason for submitting a “late” application (letter here pdf).

In November 2013, SCCDC applied once more to register an interest in Castle Toward. Scottish Ministers approved this application and it was registered on 23 January 2014 (see letter here 1.1Mb pdf). The effect of registration is that the landowner (Argyll & Bute Council in this case) cannot sell the land without the registered community body being notified, expressing its wish to exercise the right to buy (or not) and having that wish granted by Scottish Ministers.

Argyll and Bute Council notified Scottish Ministers that it proposed to sell the property, SCCDC were then informed and indicated that it wished to exercise its right to buy. Scottish Ministers gave their approval on 22 October 2014 (see letter here pdf). Under the Land Reform Act, the community has six months (from the date on which it indicated it wished to exercise the right to buy) within which to complete the acquisition. This period expired on 31 January 2015.

Case Exposes Flaw

At this point I realised that there was more to this story than just the behaviour and actions of Argyll and Bute Council and that it exposed a significant weakness in the legislation. The act is currently being amended in Parliament as part of the Community Empowerment (Scotland) Bill. Due to lack of time, I took a decision not to follow the Bill through Parliament but I now wish that I had taken more interest.

The flaw in the legislation is that, whilst the community body has six months within which to complete the sale, the landowner can withdraw the land from sale at any time and can refuse to sell the land to the community body. In other words, an owner’s intimation that they plan to sell (which triggers the right to buy process) is not an obligation to sell even if the community wants to exercise its right-to-buy and has the money. It’s rather like offering a child a sweetie if they jump through certain hoops then at the end saying “sorry you cant have the sweetie”.

[Update – note Neil King’s comments below. In this case, the valuation placed on the property under the Land Reform Act is £1.75m. SCCDC are not offering that and thus, in law, the Council are entitled not to conclude a sale].

Of course, the owner cannot sell to anyone else so long as there is a registered interest so the scene is set in certain circumstances for a stalemate such as we have at Castle Toward. This is not the first time that this problem has surfaced. From memory, it has occurred on at least one other occasion.

I had presumed that this (and other weaknesses in the legislation) would have been dealt with during the passage of the Community Empowerment Bill. But I’ve had a quick look at it and it seems the only reform is to make the owner liable for the costs of the valuation should the sale not proceed (Section 44). I have contacted others who have taken a close interest in the legislative process and, although this issue has, apparently, been raised, it has not been dealt with.

Thus I suggest that at Stage 2 of the Bill, an amendment is introduced to the following effect .

Where an owner of land, over which there is a registered interest, decides to sell the land and, as a consequence, triggers the community right to buy, the owner shall be obliged to transfer the land within the six-month period on the terms specified in the legislation. Failure to do so shall allow Scottish Ministers to acquire the land using powers of compulsory purchase.

Is that a) feasible and b) politically acceptable?

NOTES

(1) See the Register of Community Interests in Land for details of registered interests.