Changes to the Agricultural Holdings Act (AHA) 1986 relating to tenancy succession laws in the UK, which were adopted under the Agriculture Act 2020 in a phased basis to simplify succession proceedings, came into effect on September 1, 2024.
Upon eligibility, a close relative of a tenant can inherit the agricultural holding in two circumstances;
- On death of a sole surviving tenant;
- On retirement of a sole tenant (or all joint tenants).
However, the tenancy must be governed by the AHA 1986 before the new rules apply and only two successions are permitted in every tenancy case.
An applicant must fulfil certain requirements before they are entitled to takeover the tenancy lease upon the death or retirement of the previous tenant.
Firstly, the candidate must be categorised as an ‘eligible person’ meaning, they must be a close relative of the diseased or retiree, i.e. a spouse/civil partner, sibling or a child / treated as a child.
Succession Legislation
Under the new changes, the applicant will need to undertake a suitability test to demonstrate that they have the likely capacity to farm the holding ‘commercially to high standards of efficient production and care for the environment’.
The test may include an assessment of the applicant’s experience, training or agricultural expertise as well as their health, financial standing and strength of character.
If the tenancy was on the open market, consideration would be paid to whether “a prudent landlord would regard the applicant to be of a standard which they would be willing to grant them a tenancy”.
Previously, an applicant would be excluded from a tenancy succession if they were already in possession of a commercial unit of agricultural land.
This occupancy condition has been abolished under the new changes as it was considered discriminatory to entrepreneurial tenants.
The condition that the predecessor must be aged 65 or older before a successor could inherit the tenancy has also been abandoned and there in no longer a minimum age in place.
These succession changes were brought in to ensure the law is more reflective of modern farming practices to align with current agricultural policies within government.
The new law will potentially weaken a landlord’s ability to recover vacant land but strict statutory time periods for service of notices under the AHA will continue to apply.
Under the Act, there is an onus on the landlord to issue a notice to quit of an agricultural holding occupied under the ASA 1986 under Case G upon the death or retirement of their tenant.
The landlord must issue this notice to quit within three months of receiving written confirmation of a tenant’s death or retirement.
Alternatively, the three months will start running when the landlord receives a notice of an application for succession if no formal written notification of death was received. This procedure is strict in nature and the time limits imposed are inflexible.
If the three month deadline to serve a Case G notice is missed, the tenancy will automatically be transferred to the previous tenant’s personal representatives.
