Where there’s a Will, there’s a way

I G MacDonald, Crofter, Vice Convener of the Crofting Commission and Commissioner for Skye and the North West Highlands tells us of the importance of considering what to do with your croft when you can no longer work it.  crofting_commission_021 (2)

Many of us are getting to an age where we start to think, “What will happen to my croft when I am no longer able to work it?” and I’m often asked by folk what is the best thing to do. It’s obviously a matter of personal choice on whether you do something now or make provision in a Will for the transfer of the croft.

I have 2 crofts so I thought the best thing for me to do was to assign (transfer) one of the crofts to my daughter. She’s always been keen on crofting so it made sense to do the transfer now while we can still operate together and she can take on the heavier work.

So what are the options? Well that will depend on whether you are the tenant or an owner-occupier crofter.

If you are a tenant you could, like myself, consider assigning your croft to a younger person, or you could sublet the croft to someone who will cultivate and maintain it.

But if you decide to assign the croft tenancy remember this is a permanent transfer – you cannot subsequently change your mind! And if you want to keep the croft house you need either decroft or purchase it before transferring the croft land. Why? Well when you assign a croft everything that is held in tenancy is transferred to the new tenant and that would include the croft house if you don’t decroft or purchase it beforehand.

On the other hand a sublet is NOT a permanent transfer and you will remain the principal tenant of the croft with the subtenant having the right to use the croft for the term of the sublet which can be up to 10 years. Both assigning and subletting need the consent of the Crofting Commission and you’ll find the application forms for these on our website.

So that’s options for a tenant. What if you are an owner-occupier crofter? An owner-occupier could consider a short-term let of the croft or let the tenancy to a younger person.

A short-term let is similar to a sublet and is NOT a permanent transfer of the croft land. However, if you decide to let the tenancy this is a permanent transfer and you would become the new tenant’s Landlord. Even if the tenant decided to give up (renounces) the tenancy for whatever reason you would not revert to being an owner-occupier crofter but become the landlord of a vacant croft.

What if I don’t want to transfer the croft during my life time? If you don’t want to transfer the tenancy now the best advice is to arrange for a solicitor, who has some knowledge of crofting law to draw up a Will and make provision for the successionHeatherGray3 Small to the tenancy of the croft. You’ll need to make sure that all interests of the croft (such as grazing shares where the croft has been purchased) are clearly dealt with in the Will. It is easy to get caught out by an imprecise Will, for example “I bequeath my croft tenancy to my son.” When you do not actually name your son, the croft or you have purchased the croft from the landlord several years ago and are no longer classed as a tenant but an owner-occupier crofter.

If you make a Will then, after your death, there is a period of 12 months during which the executor or the legatee (the person you nominate to get the croft tenancy) must notify the Landlord and the Commission that they accept the bequest.

You have a basic right to bequeath (leave) a croft tenancy to a natural individual – it doesn’t have to be a family member. It is also possible to bequeath a croft tenancy to more than one individual, but in most circumstances it is not to be recommended because the croft must be divided so each person gets the bit they are bequeathed (left). The Commission consent is required for such a bequest to be effective. If the Commission refuse – if for instance the croft is too small to divide, the bequest falls into intestacy. Similarly if the 12 month deadline for notifying the landlord and Commission is missed, then an intestacy arises!

If intestacy arises the executor has 24 months to notify the Landlord and the Commission.

If there is no Will, or the Will does not clearly deal with the crofting interests, get specialist legal advice as soon as possible as the rules of intestacy are complicated and can, in certain circumstances result in loss of the croft tenancy.

As I said there is a 24 month period during which an executor can transfer a croft tenancy in intestacy. It is surprising how frequently this deadline is missed as the following must take place which can be very time consuming:

  • An executor must be found (usually the closest family member) and confirmed by the Sheriff Court;
  • The executor must identify those with an interest in the croft under the rules of intestate succession
    • A professional valuation of the croft must be carried out;
    • The executor must decide if there is a suitable tenant amongst those entitled to succeed, who can afford to “buy out” the other entitled parties;
  • If there is no suitable tenant, the croft may be marketed on the open market. Estate agents must be instructed, maps drawn up etc.

All of this takes time. If the croft is not transferred within the 24 months, there are circumstances where the landlord can bring the croft tenancy to an end – and all that the beneficiaries are entitled to is compensation for any permanent improvements on the croft.

The Commission cannot be flexible with these timescales and deadlines, as they are set out in the Crofters (Scotland) Act 1993.

So remember make a Will, make a Will, make a Will.

Have a look at the Factsheets on our website for more detailed information or check out my short film on succession planning.

There are also a couple of case studies on assignation and subletting on our website that are great examples of crofters planning for the future and helping younger crofters.