“For the commoune goode of the toune”

The Common Good property held by Scottish local authorities

“The common good is a fund of money and assets, formerly owned by a burgh and now owned and administered by the local authority for the relevant area”  Andrew Ferguson, Common Good Law (2nd edition, 2019) p.1

That description by the author of the leading text on common good law is an accurate description of the “common good”.

It is a fund of money and assets. It can include money and investments, civic regalia, artworks, and much else. However, the most significant element of the common good, and source of legal questions and disputes, is land. That land normally includes the buildings on it, as the significant recent case of Guild v Angus, [2020] CSIH 50, 2021 S.C. 83, makes clear.

In that case, Mr Guild challenged Angus Council’s decision to demolish a leisure centre in Forfar, located in a public park which was part of common good land. The Council argued that the leisure centre itself was not common good property. The Council was successful in the Outer House, but that decision was overturned (by a majority) in the Inner House.

On that question, Lord President Carloway said

“unless structures which are built on the land are held under a separate title, they will be regarded as having acceded to that land and thus become part of it and the title which relates to it. That accords with the principle, which stems from the Roman Law and is laid down by the institutional writers (Stair, Institutions II, i, 40; Erskine, Institute II, i, 15; Bell, Principles , para 937), and with precedent ( Brand’s Trs v Brand’s Trs , Lord Cairns LC, p 20, Lord Chelmsford, p 23). This principle applies to common good land ( Magistrates of Banff v Ruthin Castle Ltd , Lord Mackay, p 49). The Lochside Leisure Centre is therefore part of the common good land. The accounting practices of the respondents and their intentions are irrelevant to this issue.”

The common good property held by local authorities today originates in the common good of a burgh, a concept which has existed for more than 500 years, as the following extract (still in force) from the Common Good Act, 1491, demonstrates.

Item it is statut and ordinit that the commoune gud of all our souerane lordis burrowis within the realme be obseruit and kepit to the commoune gude of the toune and to be spendit in commoune And necessare thingis of the burght be the avise of the consale of the toune for the tyme and dekkynnis of craftis quhare thai ar.. (Common Good Act 1491, s. 1)

Burghs were the unit of local government of most established urban communities in Scotland for almost a thousand years, until a local government reorganisation which came into effect in 1975. Burghs may have originated in many ways: as royal burghs, burghs of regality, burghs of barony, ‘police burghs’ – burghs established under a number of 19th century “Burgh Police Acts” (which is a misnomer, as those burghs had powers over many aspects of local government).

The history is interesting, but is only of relevance for this article because common good property can only exist today if it originated in the common good of one of those burghs. There is not, therefore, a ‘common good ‘ for areas of one of today’s local authorities which were not comprised within one of those burghs (although counties and burghs without a Common Good were empowered under the Local Government (Scotland) Act 1947 to set up fee funds from certain fees and commissions for similar purposes).

All those burghs were abolished as separate units of local government in 1975. Their common good funds were transferred to the successor local authorities, who took over the ownership and administration of the relevant areas containing those burghs.

Local government was again reorganised in 1996 by the Local Government etc. (Scotland) Act 1994. Under section 15(4) of that Act, common good property was once again transferred to successor authorities, who must administer that property having regard to the interests of the inhabitants of the area to which the common good related prior to 16th May 1975, or, in the case of the councils for Aberdeen, Dundee, Edinburgh and Glasgow, have regard to the interests of all the inhabitants of their areas.

It should be noted that the requirement is to “have regard to the interests of”, not “for the benefit of”, or some such wording, nor is there any requirement that any such property should for all time be administered in such a way that it is situated within that area.

Mention should also be made here of the fact that some community councils have been allowed to describe themselves as Royal Burghs eg Royal Burgh of Cupar Community Council. That does not give them any ownership or control over the common good of those former burghs – although they have certain rights to be consulted because of their status as community councils, as is explained later.

Until recently, the extent of common good property throughout Scotland was unknown. Many local authorities believed, or reported, that they had hardly any common good property at all. However, in the last decade or so, there has been a growing interest in common good property, and that has led to an awareness of the significant extent, and the value of, property held on the common good.

Since 2017 the extent of common good property has become more apparent because of s. 102 of the Community Empowerment (Scotland) Act 2015, which requires all local authorities to establish and maintain a public register of property held by the authority as part of the common good. From inspection of a number of those, it is obvious that the approach taken by different local authorities to what property should be regarded as common good varies.

It should be remembered that the register is not a definitive list of the common good property in that area. Other property may be added if more information becomes available. Some local authorities have included items of property which are identified as potentially within the common good, and are the subject of further investigation.

Removal from the list of property included in error is also possible, although unlikely, because of the extensive public consultation that would have been undertaken prior to its publication.

What is clear that the requirement to establish a register, with the public input into that process that was required by the legislation, led to a substantial increase in the extent of the property that was now considered to be within the ‘common good’. That the common good should be so extensive should not be surprising,  given that there is clear authority that

 “…all burgh property, in so far as it has not been acquired by statutory powers or forms part of separate trust estate administered by burghs, must form part of the common good of the burgh.” Magistrates of Banff v Ruthin Castle Ltd, 1944 S.C. 36, at P.58

Such a broad definition may alarm some of those who direct or manage local authorities. It should be borne in mind, however, that much of the land previously acquired by a burgh, is likely to have been acquired under statutory powers eg for housing, education, parks and recreation, public halls, water and drainage, fire stations, and many more besides.

Furthermore, if the land is not within the area of a former burgh, it will not form part of common good (although it is presumably possible that common good funds may have been used to purchase property outside the former burgh’s boundary, which would therefore be comprised within that common good property).

One question which may be asked is what is the “common good” which property within it is required to serve. It appears to me that there must be an argument that, if the item of property has been constituted as common good property for a specific purpose, the common good property in question should only be used for those purposes, or purposes reasonably closely related to them.

This then raises the question of what happens to any income derived from that property, or from capital receipts if it is disposed of. This will normally (unless the court says otherwise) be paid into common good funds, be used to support running costs of other common good property, or to acquire new property to be held as common good (even though it appears to me that the nature of common good property, as something which has been inherited from now defunct burghs, means that the general rule is probably that new common good cannot be created).

If that income or capital derives from common good property which is dedicated to a particular purpose, then it might also be argued that it too should only be allocated to support that purpose, or purposes related to it. However, the practice in most, perhaps all authorities, appears be that all common good property is held in one account for each former burgh, and any income or expenditure arising from it is allocated to those dedicated accounts. That is certainly the approach recommended by LASAAC in the guidance it produced in 2007 on accounting for the common good. (Note, however, the comments made by Lord Carloway in Guild, set out above).

However, it is perhaps a matter which should be borne in mind in the management and even more so, the disposal, of common good property, particularly when making an application to the court for approval of a disposal or appropriation of common good land.

In any event, what happens if an authority wants to change the use of the property beyond that permitted by the founding deed (or customary use), or dispose of it?

Some older cases suggest that property could be regarded as being removed from the common good with no great difficulty, if the activities concerned could be undertaken elsewhere, e.g. in Magistrates of Kirkcaldy v Marks & Spencer Limited, 1937 S.L.T. 574, Cockenzie and Port Seton Community Council v East Lothian District Council, 1997 S.L.T. 81. Other cases indicated a much stricter approach, where the common good status of property was rigorously protected against removal from that status.

However, the more recent approach of the court has left no doubt of the special protected status of common good property.

Scots law has been zealous in the protection of common good property, even in cases in which the local authority proposed to put common good land to what was prima facie a reasonable and productive community use (see, eg Grahame v Magistrates of Kirkcaldy , where the court held that the ground was vested in the magistrates for the common use and enjoyment of the inhabitants, and that neither previous encroachments, nor its neglected condition (as a public dung stand) nor the fact that it was of little or no value to the public, entitled the magistrates to apply it to any purpose inconsistent with such common use and enjoyment — even as town stables; see also Portobello Park Action Group Association v City of Edinburgh Council). If the respondents’ argument is sound, these cases could have been circumvented by the local authority simply leasing the land under a ‘notional tenancy’ to itself to enable buildings to be erected thereon in the public interest” (Guild v Angus, [2020] CSIH 50, 2021 S.C. 83) Lord Menzies, at para 37.

An authority which seeks to “change the use” (that is, appropriate) or dispose of common good property must therefore rely on the statutory provisions governing the disposal of common good property. 

These relate to land only, but it is of course land that is the main focus of interest in common good matters.

The relevant provisions are to be found in the Local Government (Scotland) Act 1973, and are as follows.

s. 75.— Disposal, etc., of land forming part of the common good.

(1)  The provisions of this Part of this Act with respect to the appropriation or disposal of land belonging to a local authority shall apply in the case of land forming part of the common good of an authority with respect to which land no question arises as to the right of the authority to alienate.

(2)   Where a local authority desire to appropriate or dispose of land forming part of the common good with respect to which land a question arises as to the right of the authority to alienate, they may apply to the Court of Session or the sheriff to authorise them to appropriate or dispose of the land, and the Court or sheriff may, if they think fit, authorise the authority to appropriate or dispose of the land subject to such conditions, if any, as they may impose, and the authority shall be entitled to appropriate or dispose of the land accordingly.

(3)   The Court of Session or sheriff acting under subsection (2) above may impose a condition requiring that the local authority shall provide in substitution for the land proposed to be appropriated or disposed of other land to be used for the same purpose for which the former land was used.

Disposals or any other use of common good property, whether alienable or inalienable, still have to be undertaken within the general rules applicable to local government finance eg on best value, capital controls, etc. (City of Aberdeen DC v Secretary of State for Scotland, 1990 SLT 291). In that case, it was held that the Council still required capital consent to use funds in common good account to build a leisure centre.

From a practical point of view, as a local authority (and a potential purchaser or user of property) will not want to run the risk of the transaction being challenged at a later date, authorities tend to apply to the court if there is even only a slight possibility that there is such a question. Not surprisingly there is limited case law on when there is no such question, but there is authoritative case law on when land cannot be alienated.

“It appears to me that in the most extended view which can be taken of the constitution of public rights of this description, there are at least three ways in which a public use of burgh property may be acquired. The land may be appropriated to public uses in the charter or original grant; the land, after it is vested in a public body, such as a town-council, may be irrevocably appropriated to public uses by the act of the town-council itself; and again it may be so appropriated, or rather the inference may be drawn that it was originally appropriated to public uses from evidence that the land has been so used and enjoyed for time immemorial.”

Murray v Magistrates and Town-Council of Forfar,(1893) 20 R. 908, at p. 918.

However, even if the there is no right to alienate, s. 75 does give the court the apparent power to allow the removal of land from common good entirely, and to impose wide range of conditions if that is to be allowed.

Until recently, those provisions of the 1973 Act were the only ones which specifically governed the disposal and use of common good property. However, the Community  Empowerment (Scotland) Act 2015 introduced a consultation process.

s. 104 Disposal and use of common good property: consultation

(1)  Subsection (2) applies where a local authority is considering—

(a)  disposing of any property which is held by the authority as part of the common good, or

(b)  changing the use to which any such property is put.

(2)  Before taking any decision to dispose of, or change the use of, such property the local authority must publish details about the proposed disposal or, as the case may be, the use to which the authority proposes to put the property.

(3)  The details may be published in such a way as the local authority may determine.

(4)  On publishing details about its proposals under subsection (2), the local authority must—

(a)  notify the bodies mentioned in subsection (5) of the publication, and

(b)  invite those bodies to make representations in respect of the proposals.

(5)  The bodies are—

(a)  where the local authority is Aberdeen City Council, Dundee City Council, the City of Edinburgh Council or Glasgow City Council, any community council established for the local authority’s area,

(b)  where the local authority is any other council, any community council whose area consists of or includes the area, or part of the area, to which the property mentioned in subsection (1) related prior to 16 May 1975, and

(c)  any community body that is known by the authority to have an interest in the property.

Consideration must be given to representations received in that process. Statutory guidance has been published by the Scottish Government guidance on how the consultation procedure should be undertaken:

https://www.gov.scot/publications/community-empowerment-common-good-property-guidance-local-authorities/

Guild v Angus, [2020] CSIH 50, 2021 S.C. 83) emphasises that the provisions of section 104 have to be interpreted broadly. At para 28, Lord Menzies says:

When considering the proper construction of sec 104 of the 2015 Act it is, I think, important to bear in mind the underlying purpose of the legislation (as indeed it is in any exercise of statutory construction). Part 8 of the Act , which deals with common good property, is concerned (as the title of the Act suggests) with empowering communities. Section 102 requires a local authority to establish and maintain a common good register, and before…

At para 29: The aim is transparency, and encouragement of community involvement. As the policy memorandum to the Bill put it (para 87):’The aim of Part 6 of the Bill is to increase transparency about the existence, use and disposal of common good assets, and to increase community involvement in decisions taken about their identification, use and disposal.’..

And at para 30:

 What the 2015 Act is not about is prohibiting, preventing or regulating the actual disposal of, or appropriation of, common good property: that is dealt with elsewhere, by the common law, or by sec 75 of the Local Government (Scotland) Act 1973 , and the requirement to apply to the court for authority. Section 104 of the 2015 Act is all about publication and consultation at an earlier stage, before any decision has been taken by the local authority to dispose of or change the use of property held as part of the common good, and when the local authority is only considering disposing of or changing the use of such property.

31.  The fact that this relatively new statutory provision is about transparency and encouragement of community involvement, and not (or at least not directly) about the identification of common good property or about the authority to dispose of or appropriate such property may mean that a broader interpretation of some of the terms used in it than would be applied in different contexts is appropriate”.

An example of a consultation document produced recently by a local authority, for an application for major change of use of common good property can be seen here: https://www.northlanarkshire.gov.uk/your-community/working-communities/consultations/closed-consultations/kildonan-street-municipal-building-consultation Other consultation documents may be much smaller in scope, and that is quite reasonable for a straightforward application for transfer. However, in a complex application for appropriation or disposal of common good property, as in the above one, a comprehensive consultation document is probably desirable. Showing that the consultation process was thorough may certainly be of importance in persuading the court to grant the application.

This article is based on notes prepared for a webinar presentation given by Terra Firma Chambers, on 7 November 2022.

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