Lands Tribunal for Scotland

OPINION

Graham
v
Northern Joint Police Board

This is an application by a retired police officer, Ronald Graham. He seeks a finding in terms of section 71(2)(a) of the Tenants' Rights (Scotland) Act 1987 (hereinafter referred to as "the Act") that his landlord, Northern Joint Police Board, failed to issue timeously either an offer to sell or a notice of refusal to sell in response to an application by him to purchase his dwelling house. It was a matter of agreement that no offer to sell had been made and that no formal notice of refusal had been issued. It was not disputed that the Tribunal was bound by authority to proceed on the basis that the landlords had, accordingly, lost any right to challenge the applicant's right to buy. The substantive issue before us was whether there had been any relevant waiver of right. Although the point does not arise sharply, it may be noted that it was not suggested that any distinction had to be drawn between the respondents and the Chief Constable for any purpose relevant to the matter of waiver.

At the hearing the applicant was represented by Michael G J Upton, advocate, instructed by Messrs Middleton Ross & Arnot, Dingwall. The respondents were represented by Alan R Dewar, advocate, instructed by their own solicitor. Mr Upton led evidence from Mr Graham. Mr Dewar led evidence from Hugh A Mackay, a retired police officer who had been area commander with Northern Constabulary responsible for Ross, Cromarty and Skye; Angus Macleod, Estate Manager of the respondents; Rhona J M Moir, Principle Administrative Officer with Highland Council involved in the provision of clerking services for the respondents; Elizabeth Wrathmell, Head of Human Resources with Northern Constabulary; and John B Finnie, a representative of the Northern Constabulary branch of the Scottish Police Federation. We heard evidence and certain submissions at Dingwall on 29 February and closing submissions in Edinburgh on 3 March 2000.

The substantive law was not in issue and can be summarised briefly. The Act gives certain tenants of certain categories of landlord a right to buy their dwelling with a discount on the market value determined by their years of occupancy. The rights of a tenant depend on whether they have the status of "secure tenant" as defined in the Act. When a tenant makes an application to purchase he does not require positively to establish his status as secure tenant. If the landlord disputes the tenant's right to purchase it has, in terms of section 68, an opportunity to issue a notice of refusal within one month. If it does not do so, section 71 provides for the tenant to apply to the Tribunal for a finding that no timeous notice has been served. Thereafter, the Tribunal must step into the shoes of the landlord and make the necessary administrative arrangements leading to an appropriate offer to sell being made to the tenant.

The particular circumstances of the present case, as admitted or proved, can be set out as follows:

1. The applicant joined the Northern Constabulary in about 1966. He retired as a police constable in September 1999. Apart from a brief interlude between 1987 and 1988, he and his wife lived in a succession of police houses from 1970 until his retirement. He continues to live in the dwelling 5 Logan Drive, Dingwall which is owned by the respondents and held by them as part of their stock of police houses.

2. Until recently, officers of Northern Constabulary, such as the applicant, had a choice between acceptance of free accommodation or receipt of a housing allowance which would allow them to make their own housing arrangements. The applicant had always chosen the former. He paid no rent or rates (or equivalent) in respect of his accommodation. It was routine practice to require officers to sign an occupancy agreement for each house they occupied. The standard form of agreement included a provision: "The occupier acknowledges by his acceptance hereof that the right of occupancy hereby created does not comprise or constitute a secure tenancy in terms of the Housing (Scotland) Act 1987 since the Northern Joint Police Committee is a Police Authority in terms of Section 61(2)(a)(viii) of the said Act and the occupier is a Constable of the Northern Constabulary within the meaning of the Police (Scotland) Act 1967, who in pursuance of regulations under Section 26 of the last said mentioned Act, occupies the house without obligation to pay rent or rates". We accept that when he took occupancy of the dwelling at 5 Logan Drive in about December 1990 he completed such an agreement.

3. Police housing was formerly held in name of the said Committee. As a result of administrative changes in about April 1996 the property is now held in name of the respondents. A stock of police houses was, and is, seen to be essential as part of the operational requirements of the Northern Constabulary. Because of the geography, any change of posting, including promotion, is likely to give rise to a need to change accommodation. The respondents do not see their role as being that of a housing authority. Their management and use of housing is purely to ensure operational efficiency. It is a means of ensuring that an adequate number of officers can be stationed throughout the operational area.

4. Until about 1993 it was the policy of the Committee to allow officers, where possible, to buy their houses at a discount. This, no doubt, reflected a recognition that the officers were, in effect, paying for their accommodation by foregoing a housing allowance. The policy, however, led to a sense of unfairness within the Force because, in the more remote areas, it was not possible to sell off the housing stock. Officers in "multi-officered" postings such as Dingwall were seen to be at an advantage.

5. Since 1993 the policy of, first the Committee, and then the Board, has been that houses are not sold to occupying officers either at discount or otherwise. If a house is vacant and judged to be surplus to requirements it will be sold. This may involve an initial offer being made to the local housing authority. If such authority does not take the house it will be put on the open market. The change of policy was formally intimated throughout the Force by way of notice. The new policy led, in turn, to feelings of unfairness amongst officers, such as the applicant, who might reasonably have expected to be able to buy under the old one.

6. After the change of policy the applicant had several informal discussions with Mr Mackay about the general question of being able to buy his house. Mr Mackay retired in September 1998 but was previously Area Commander with wide responsibility for operational matters in Ross, Cromarty and Skye, including responsibility for arranging housing for officers. He was on terms of personal friendship with the applicant. Mr Mackay had no direct responsibility in relation to sale of houses. The applicant was aware of this. However, in various conversations dating from at least early 1996 onwards, he made clear to Mr Mackay his desire to buy his house. He wanted to be able to stay in it on his retirement. He was obliged to retire at 55 but could do so earlier. He had not at that stage decided when he would retire. They were both well aware of the change of policy and Mr Mackay advised the applicant that he thought he had little chance of being allowed to buy. He did, however, say that if there was a further change of policy it might help him if he had made a formal application.

7. At a date prior to June 1996, another colleague, a PC Budge, made contact with a body known as the Tenants Advisory Service. A representative called to speak to the applicant and to PC Budge. At that meeting, the applicant was told that tenants of certain types of landlord had a right to buy their accommodation. He was told that the Police Board was such a landlord. The applicant did not recall all that was said by the representative. He had no memory of any specific advice as to whether his own status was, or was not, that of a secure tenant.

8. Following the meeting, the applicant submitted a formal application to buy his house. He sent it through internal mail. It was received by the Chief Constable. The precise date of submission was not established but can be treated as being before the end of July 1996. The application was a proper application to purchase within the meaning of section 63 of the Act. At the time of that application the applicant was not a secure tenant and did not have any statutory right to buy. We have found it unnecessary to make any finding as to the precise state of the applicant's own knowledge of the legal position at that date. We are, however, satisfied that he was not positively aware that he had no right. The standard application form (APP1) used by the applicant contained various Notes for guidance. One such Note stated "Secure tenants of ----- police authorities ---- have the right to buy their homes". Although various Notes drew attention to limitations on the right, their was nothing on the form to show that "secure tenant" had a special meaning. There was nothing on the form to draw attention to the right to apply to the Tribunal. Although the words Housing (Scotland) Act 1987 appeared at the foot of the first page, the text made no reference to any detail of the statutory provisions.

9. At about the time of the application the effect of administrative change from Committee to Board had not entirely settled. At about that time there was also a change in Chief Constable. Mr MacMillan was replaced by Mr Robertson. There was no evidence as to what happened to the application after it was received. It was not acknowledged. The applicant was never given any direct information as to what had been done with it. He occasionally asked Mr Mackay, informally, if he had heard anything and was told that he had not. At an official meeting, some time before September 1997, Mr Mackay learned that there was to be no change in the relevant policy. He passed that information on to the applicant.

10. It was not disputed that the effect of the respondents' failure to reply by the end of August 1996 was that the applicant had a statutory right to apply to the Tribunal to proceed with the formalities of a sale to him. It was accepted, for the purposes of the hearing before us, that the opportunity to challenge his right to buy had passed as a result of that failure. However, the applicant was not aware of the detail of the statutory provisions and did not become aware of his right to apply to the Tribunal until consulting the Ombudsman as set out (at 19) below.

11. At a date which was probably in 1997, the Chief Constable, Mr Robertson, looked in to speak to the applicant in course of a visit to the Police Station at Dingwall. He referred to the fact that both he and the applicant had long service in the Northern Constabulary. He said words to the effect that he had looked at the applicant's case for buying his house and that if the applicant was to be allowed to buy, his discount would be so large, because of the length of service, that the Board would make little out of him. The applicant assumed that the Chief Constable was referring to his formal application to buy. He accepted, in cross-examination, that the conversation was not explicit and that the Chief Constable might possibly have been thinking of his well known desire to buy on his retirement. However his own understanding of the discussion was that his application was still pending. This was a reasonable conclusion for him to reach in the circumstances.

12. The applicant took no positive steps to seek a specific response to his application from the Chief Constable. However, remained anxious to purchase his house for his retirement. This was known to the Chief Constable from at least the date of the application.

13. At about the end of 1997, the applicant contacted Mr Finnie, to seek the assistance of the Police Federation in his attempts to buy the house. However, although the Federation supported the rights of officers to buy their police houses, in most parts of Scotland, it was well aware of the reasons for the policy of the Northern Constabulary. It did not oppose that policy. Mr Finnie told the applicant that the Federation would be unable to support him. The applicant had various discussions with Mr Finnie who was able to say from his records that one such discussion - not the first - took place on 6 February 1998. It is clear that the applicant was irritated by Mr Finnie's response. He said that he wished to approach the head office. Mr Finnie discussed this with him explaining that head office would not act on any request for assistance which had not first gone through him. We are unable to make any finding as to whether the applicant did, ultimately, write to the head office. However it is clear that there was never any communication from head office on the matter. In discussion with Mr Finnie, the applicant did refer clearly to the application he had made. Mr Finnie understood the reference as part of the evidence of his desire to purchase and the Chief Constable's apparent reluctance to allow it.

14. By October 1998 the applicant was actively considering his retirement. He knew that the respondents were reviewing their policy on house sales. He wished to do all he could to acquire his house. He wrote to his Member of Parliament on 29 October 1998 in the following terms:

"I am 51 years of age and am a serving police constable of the Northern Constabulary, stationed at Dingwall.

I am resident at the above address, which is a Police Authority owned house, which I wish to purchase. I have submitted a Scottish Office form APP 1 to the Chief Constable requesting my right as present tenant but have received no reply. I have been informed by the Tenants Advisory Service that such houses can now be purchased by the tenant. Our present Chief Constable Mr Robertson is selling off houses but only when they become vacant and on the open market.

In my street of about 20 (odd) houses, three of them have been purchased by police officers at full discount price (these being Police Authority owned houses) but under a different Chief Constable. I feel I am being discriminated against and would like to have your help/advice regarding this matter".

15. The M.P. took this up direct with Northern Constabulary and the response of 30 December 1998 dealt with the applicant's position as follows:

"Constable Graham occupies police owned property at 5 Logan Drive, Dingwall. It is well known within the Force that he has expressed a desire, for some time now, to purchase it on his retiral. It has also been made clear to him, on a number of occasions by a number of senior officers, that this option will not be available to him. I am surprised, therefore, that he should have approached you, except perhaps a belief by him that your intervention might bring about a change of policy. I regret that that will not be possible".

The letter then set out details of the policy and justification for it. There was nothing in the letter referring explicitly to the formal application nor referring in any way to the Housing (Scotland) Act 1987.

16. There was no direct evidence of how the application had been dealt with by the respondents. Mr Angus Macleod became Estates Manager for the respondents in early 1997. Late in 1997 Chief Superintendent John Johnston gave him the applicant's application to be filed. He told Mr Macleod that the matter had been dealt with and that Mr Graham had been informed. However Mr Macleod had no knowledge as to how it had been dealt with. He said that it would have been difficult for him to find out. There had been a change from the Committee to the Board at about the time of the application. He thought this might have given rise to some possibility of administrative difficulty. The respondents had been unable to determine whether Mr Robertson or his predecessor as Chief Constable, Mr MacMillan had had initial responsibility for dealing with the application. There was no evidence to support the respondents averment that, "following receipt of said application to purchase the Applicant was advised verbally that he did not have a secure tenancy of the said dwellinghouse so that the application would be refused". We are satisfied that the applicant was at no stage told positively that the application had been refused. He was told informally on several occasions that he would not be allowed to buy his house.

17. Late in 1998 the respondents started a review of their housing policy. Mr Macleod was directly involved. He understood that one objective of the review was to establish from the legislation whether there was a right to buy or a right to buy with discount. He had had discussions with Mr Robertson. In course of a discussion about police officers' right to buy, Mr Robertson told him that there had been an application from Mr Graham but that it had been "inconclusive".

18. Mr Macleod was responsible for management of the housing stock including the applicant's dwelling. Throughout the relevant period, that property had been managed by him like all the other properties. It was treated by the respondents as part of their housing stock. There was no evidence of any specific work being done on it or of any activity specific to it such as physical inspection or book review of its state or status. An adjacent police house had been found to be surplus to requirements and had been exposed for sale on the open market. There had been no appreciable change in the police housing situation in Dingwall over the relevant period although, generally speaking, the trend was for a diminution in the Force requirements.

19. Various documents were produced showing the applicant's communication with the Commissioner for Local Government Administration in Scotland, otherwise referred to as the "Ombudsman", followed by his contact with the Tribunal. We accept that he had no knowledge of any right to apply to the Tribunal until advised of this by the Commissioner. In his initial letter of 2 February 1999, the applicant narrated that Logan Drive had had eight police houses but that three of them had been purchased by serving police officers. The house next door at No. 7 had just been vacated by an officer who had been posted to Kyle of Lochalsh. The applicant understood that it was about to be placed on the open market for sale. The letter referred to his years of police service and his feeling that he was being prejudiced against by his Chief Constable "who is now selling off police houses on the open market and not complying with the Government scheme of having 'the right to buy' as sitting tenant". He went on to say that he had been spoken to by a representative of the Tenants Advisory Bureau and informed by him that he had the right to purchase with full discount under the scheme. He made a reference to the Chief Constable having "turned around" after telling him that he had a right to discount. The latter reference can be understood as relating to the conversation he had in course of the Chief Constable's visit to Dingwall Police Station, discussed above. The Commissioner replied by requesting sight of the "reply you have received … in response to your application to purchase." On 12 February 1999 Mr Graham wrote in reply narrating that he had completed the appropriate Scottish Office form APP/1 "over nine months ago" and submitted it to his Chief Constable. He had never received a written or verbal reply from the Chief but had heard through the usual channels that the Chief would not sell houses to the sitting tenants. He continued: "I was told by an officer of the Tenants Advisory Service that I should have lawfully received a reply to my application APP/1 form but this has not been the case". The applicant was eventually advised by the Ombudsman to contact the Tribunal. On the advice of the Clerk to the Tribunal he contacted solicitors. A letter of 17 August 1999 was sent to the Tribunal from his solicitor enclosing an application for a finding in terms of section 71(2)(a). That application left blank the space for detail of the application to purchase. The Clerk responded to point out this omission and request a fresh form completed appropriately.

20.  The applicant accordingly contacted the Chief Constable's secretary in an attempt to recover a copy of his application to purchase. He was initially told that it could not be traced. However, it was later found and sent back to the applicant. A fresh application for a finding in terms of section 71(2)(a) was presented to the Tribunal dated 16 August 1999 but under a covering letter of 29 September. It was date stamped as having been received on 30 September 1999. In this form details of the application to purchase were completed in the following terms: "Hand delivered to the Chief Constable of Northern Constabulary, Mr Bill Robertson on 15 July 1996".

21. After being told that the original form could not be found, the applicant submitted a fresh application to purchase (form APP1) on 21 September 1999. By letter of 27 September 1999 this was refused. The letter said that, "The Clerk to the NJPB has advised the Chief Constable that your tenancy of police housing is not secure and consequently you have no right to buy." An application to the Tribunal for a finding in terms of section 68(4) was lodged. That application was sisted to await disposal of the present application.

Submissions

Both counsel made careful submissions on aspects of the evidence. We have had regard to these submissions in setting out the narrative above and return to certain matters in the discussion below. We attempt to summarise the submissions on matters of law.

For the applicants, Mr Upton dealt with the formal nature of the application and its procedural implications. If granted, the Tribunal should go on to complete procedures necessary to make a formal offer of sale to the applicant in terms of section 63(2).

He set out in detail the relevant statutory provisions relating to the right to purchase. It was not disputed that the applicant was a tenant within the meaning of section 82. He was entitled to apply to buy under section 61. The formal requirements of section 62 that the respondents were heritable proprietors; that the applicant had residential qualification; and that the spouse had consented, were not in dispute. The application had been duly made in terms of section 63. There had been no relevant response under any of the provisions of sections 63(2), 64 or 68(2). The Tribunal was bound by the decision in Livingstone v East of Scotland Water Authority 1999 SC 65. It could not consider the issue of right to purchase. Unless the respondents' contentions in relation to waiver were upheld, the Tribunal should proceed to make a formal offer. He submitted that there was no substance in the defence of waiver.

The law of waiver should now be seen to be based on the decision in Armia Limited v Daejan Developments Limited 1979 SC 56. There were two essential elements: conduct on the part of the applicant which could reasonably justify the inference that he had waived his rights; and proof that the respondents had, in some way, changed their position in reliance on that conduct.

In response to the Tribunal, he said that there was a conceptual difference between an express abandonment and waiver or abandonment implied by conduct. If waiver was to be inferred from conduct there had to be actings on behalf of the party seeking to rely on the waiver which could be shown to have been in such reliance. Reliance required proof of change. It did not need to be to the prejudice of the respondent. The fundamental difficulty for the respondents was that their actings were based entirely in reliance on their policy and understanding of the law. Nothing they did was in any way attributable to reliance on any change of heart by the applicant. They had not changed their position in any way.

The need for proof of reliance by way of some change in the conduct of affairs was well-established since Armia v Daejan. He referred to Lousada & Co Ltd v J E Lesser (Properties) Ltd 1990 SLT 823 at 827 J to L. In response to Mr Dewar's submissions, he elaborated his initial submissions on this point by stressing a need not only for a conscious conclusion by the respondents that there had been abandonment but a causal connection between abandonment and their own actings. There had to be an overt act of acceptance. Waiver was a bilateral consensual concept. He referred to Atlas Assurance Co Ltd v Dollar Land Holdings plc 1993 SLT 892; Barratt Scotland Ltd v Keith 1994 SLT 1337; and Morrison's Executors v Rendall 1986 SLT 227. In the latter case, at page 231F, the Lord Justice Clerk (Ross) had given examples of the type of actings which might show that the party seeking to rely on the waiver had conducted their affairs on the basis of abandonment. These examples were relevant to the present case. There was no suggestion that the respondents had carried out any work on the house itself or changed the manner in which they dealt with their housing stock in any way in reliance upon any actings of the applicant.

In elaboration of his submission, Mr Upton adopted various passages from the contribution of Sheriff Bell to the Stair Memorial Encyclopaedia Volume 16. In particular he referred to passages at 1630; 1634; and 1636 to 1639.

He dealt specifically with the issue of mora. There could be no waiver from mere delay. In the present case there was no statutory timetable for the application to the Tribunal under section 71. This could, he said, be contrasted with a normal prescription time for enforcement of missives which would be at least five years. Indeed, he submitted, under reference to the decision of the Second Division in the case of Barratt Scotland Ltd v Keith 1994 SLT 1343 that the appropriate period would be 20 years. The short periods provided by the statute could be compared with typical short periods provided by parties for detailed aspects of their missives. However, the timetable for application to the Tribunal could be compared with the timetable for going to the Court to enforce missives if the parties had made no express provision. There was nothing approaching even five years in the present case. He challenged the inference which Mr Dewar attempted to draw from the various short time limits provided under the Act. The proper inference, by contrast, was that, as no timetable had been provided for application to the Tribunal, it was not intended to be limited in any way.

In summary, on the evidence, he submitted that there was nothing about the applicant's conduct which could justify the respondents in assuming that he had irrevocably and permanently abandoned all claim to purchase the house. It was, on the contrary, clear at all times that he was anxious to buy the house. Further, it was clear that there had never at any time been any acting in reliance on abandonment by him.

For the respondents, Mr Dewar accepted that if he failed to establish waiver the normal consequence would be for the Tribunal to initiate proceedings for sale. However he invited us to delay pronouncing any formal order, to allow the parties to negotiate that matter amicably. He accepted that the Tribunal was bound by the effect of the decision in Livingstone v East of Scotland Water. He expressly reserved his right to make further submission in respect of that decision if the case proceeded to appeal. He accepted that the onus was on the respondents to establish a relevant waiver. There had to be waiver of an identifiable right. In this case the relevant right was the right to come to the Tribunal.

Prior to the decision in Armia v Daejan there was confusion in the reported cases between personal bar and waiver. He submitted that it was from such earlier cases that confusion, in particular, arose in relation to the concepts of reliance, prejudice, and alteration of position. Waiver, however, was a question of fact. It was an abandonment of rights. It was difficult, therefore, to see the relevance of the conduct of the party seeking to rely on the waiver. In any event, it was sufficient that the party claiming the benefit of a waiver had conducted his affairs in some way on the basis of the waiver. There was no justification for any requirement of proof of alteration of position. It would be sufficient if that party decided that no particular action was required. The effect of the decision in Armia v Daejan was that there had to be actings known to the benefited party. There was, however, no express reference in that case to the character of any actings of the benefited party. At page 69 Lord Fraser had adopted dicta of Lord Hailsham of St Marylebone and Lord Reid from Banning v Wright 1972 1WLR 972. Neither had referred to conduct of the relying party. The reference to "conduct of affairs" taken from W J Alan & Co Ltd v L E L Nasr Export and Import Co 1972 2QB 189 did not imply a need for active conduct. He submitted that if the fundamental concept was abandonment, equitable considerations were irrelevant. There was no express reliance on equity in the speeches in Armia v Daejan.

It was true that there had been reference, in decisions subsequent to Armia v Daejan, to a requirement of alteration of position. However this was not soundly based. "Conduct of affairs" did not require evidence of change. He accepted a suggestion from the Tribunal that it might mean no more than proof that the party relying on waiver had knowledge of the actings of the other party which could amount to waiver and proof that they had treated them as such.

Waiver was based on actings. It was not enough for the applicant to prove that he did not, in fact, intend to abandon a right if his actions reasonably justified a different inference. In the present case, the Tribunal could look at the overall timescale and, on the basis of the objective facts, decide that there was a stage when abandonment of right was clearly to be implied. Although no time limit was specified for application to the Tribunal where there had been no reply by the landlords, it was clear that all time limits which were specified in the statutory process were very short; usually one month but sometimes two. He referred in detail to the provisions of section 63 and sections 65 to 69 of the Act. Against that background it was clear that a reasonable period for application to the Tribunal ought to be measured in months.

If a period of two months was allowed as a reasonable time to await a response and a further two months for the applicant to decide what to do, it was clear that by the end of 1996 he had given up the right. Having regard to the tight timetable established by the Act in respect of the right to buy procedures there must surely come a stage when the Tribunal could, and should, say that it had no jurisdiction because the application had not been presented to it within a reasonable time.

In response to a question as to whether a party had to know that he had a right before he could waive it, counsel said that, in essence, the Tribunal was concerned with the applicant's right to buy his house. The applicant had given evidence that he thought he had that right. The right to go to the Tribunal was simply part of that larger right. Counsel said that his submission required to be modified to that effect. It did not matter that the applicant was not, at the time, aware of his right to go to the Tribunal although he suggested that ignorance of the law was no excuse. When considering whether an inference of waiver should be drawn, important aspects of the evidence were that the applicant plainly knew that his application had a shaky foundation. He knew the policy was against him and that he was unlikely to succeed. His inactivity against the background that he had been told that he would not succeed pointed to abandonment of the application. Mr Dewar accepted that it was difficult to point to any reason for the applicant to reach a positive decision to give up his application. However the inference from his delay took its colour from the fact that he must have known that the application would not succeed. Mr Dewar also accepted that if there had been a clear quinquennial prescription he could not have relied on inertia for two or three years as pointing to waiver. There was, however, no such prescriptive period. Time was to be assessed in light of the various short periods specified in the Act. Mr Dewar appeared, initially, to accept the proposition that his submission turned on an assumption that the applicant should be taken to be aware of the statutory provisions. However he modified this to say that once the applicant had had advice - from the Tenants Advisory Service - he should not be given too much leeway.

Mr Dewar stressed that there was a clear distinction between a general desire to buy and the specific application to purchase made in June 1996. By the end of 1996 the applicant could be taken to have given up his application. Although he had consulted Mr Finnie at about the beginning of 1998, about his desire to purchase the house, the respondents were unaware of this. It was accordingly irrelevant to objective assessment of the applicant's actings.

Decision

On the whole evidence, we are not persuaded that it is possible reasonably to draw any inference that the applicant, at any stage, waived or abandoned any relevant right. Further, we find no evidence to support the view that the respondents at any relevant stage gave thought to the question of whether the applicant had waived or abandoned a relevant right. There is nothing to show that they relied in any way on such abandonment.

It is necessary to express our conclusions in these broad terms because of the unusual nature of the rights in question and the broad way in which Mr Dewar came to describe the right which he contended had been waived. Mr Graham applied to buy his house at a time when he had no right to buy. As parties were agreed that he was not in fact a secure tenant in June 1996 it was unnecessary for them to refer to the detail of his legal position and it is unnecessary for us to consider it. If it had been proved that he was well aware that he had no such right at the time and that the respondents recognised that he knew this, it might be thought that little would be required to show that he subsequently abandoned any assertion of right. However, the case for the respondents was not presented on that basis and we are, in any event, satisfied that it could not be concluded on the evidence that he knew he had no right. It is unnecessary for us to make any clear finding as to his precise mental attitude in relation to that matter. He may have recognised that there was a difficulty.

Mr Graham was an experienced police officer and we did not expect to learn much from his general demeanour as a witness. It should be recorded, however, that contrary to the occasional impression of evasion or convenient forgetfulness in response to cross-examination, we are satisfied in light of all the evidence that he was endeavouring to give an honest account. His position was broadly supported by the evidence led on behalf of the respondents which revealed that their own position was very far from clear. The applicant's qualified responses to certain propositions put to him in cross-examination turned out to be quite appropriate. It was clear from the correspondence that he did not, in fact, have an accurate impression of the passage of time. No credible motive can be suggested for any deliberate attempt to mislead as to dates in the correspondence. He had no reason to think that the respondents would not have a record of the date of his application.

Something was made of the applicant's failure to seek a formal response to the application or even to check that it had been received. He said that he was frightened to "rock the boat" in case he was transferred out of Dingwall. He later said that this should be seen as a "concern" rather than a "fear". We have no hesitation in accepting the evidence of Miss Wrathmell that such a transfer, within five years of retirement, would have been contrary to policy unless made for disciplinary reasons. Pressing a claim in respect of his house could not have justified any disciplinary sanction. We can accept, however, that this was a matter which might have been at the back of the applicant's mind. There was no reason for him to take even a slight risk. At the relevant time, he was living rent-free. He was not immediately close to retiral. He had had no formal refusal of his application. There were indications that it was being treated by the respondents as still 'on the table'. We consider that no inference can be drawn adverse to the applicant from the fact that there could have been no real fear of being transferred.

Despite some reservations, we accept that the particular issue of whether, as a police officer, the applicant had a secure tenancy, was not discussed with the adviser from the Tenants Advisory Service. This had seemed, at first sight, surprising. As a police officer he can be taken to be aware of the importance of rules and regulations. He had signed occupancy agreements stating clearly that there was not a secure tenancy. However, although it may be thought that any person purporting to give advice to a police officer in relation to his rights under the Housing (Scotland) Act would inevitably have discussed the question of his status as a secure tenant, we have no knowledge of the skills or experience of the adviser in question. Any locally based advisory service would be unlikely to have had much, if any, experience of dealing with disputed sales of police houses as the policy in relation to them had only recently changed. A general awareness of statutory provisions relating to subjects occupied in connection with employment might have meant that the specific provisions of Schedule 2, paragraph 7(a) of the Act were overlooked. Mr Graham might well have been told that it did not matter what kind of agreement he had signed: section 61(1). These, of course, are matters of speculation but they make it impossible to infer that Mr Graham must have been told that he had no right. It would be wrong for us to attempt to draw any inference from the fact that there is no suggestion that PC Budge made any application although he had initiated the discussion and plainly received advice at the same time as the applicant. We heard no submission on the point and PC Budge's personal circumstances were not explored.

The very fact that Mr Graham did make an application is, in itself, strongly supportive of the opposite inference; namely, that he was encouraged to think that he did have a right to buy. This is also supported by the terms of his letter of 29 October 1998 to his Member of Parliament. In that letter, he said he had been told by the Tenants Advisory Service that such houses could now be purchased. He had tried to exercise his right. It is not easy to understand why he would have chosen to write in such terms to an MP if he had in fact been told that he had no right. His assertion was repeated in more emphatic terms in the letter of 2 February 1999 to the Ombudsman. It was not until 12 February 1999 that he referred to having been told by the Tenants Advisory Service that he should have lawfully received a reply to his application but had not received one. This was in response to a request from the Commissioner seeking a copy of the reply to the application to purchase. (It may be noted that there was no clear evidence of the time or circumstances in which the applicant came to be told by the Advisory Service of his right to a reply).

The right which Mr Dewar relied on as having been waived was, initially, said to be the right to apply to the Tribunal. As we have seen, the applicant, having had no right, in effect acquired a right to buy on the expiry of the one month allowed by section 68. There is nothing in the evidence to suggest that either the applicant or the respondents then knew of this right. If the respondents had been aware of the possibility at the time, it might be thought that there would have been a prompt written refusal. Further, there was evidence that they were still actively investigating the general legal position at the end of 1998. There is an obvious difficulty in seeking to identify the actings of the applicant which allowed the respondents to conclude, as matter of fact, that he had given up a right, if at the relevant time neither party knew that right existed.

On the evidence in this case it is unnecessary for us to reach any conclusion as to whether there might be circumstances in which a plea of waiver - as opposed to personal bar - could prevail in respect of a right which neither party was aware existed. Mr Dewar plainly found himself in some difficulty in defining precisely how the submissions should be modified to treat the right to apply to the Tribunal as simply part of the right to buy. The right to buy might be said to have been perfected by the absence of a response. It might accurately be described at that stage as an unchallenged right to buy. There is no evidence that the respondents were aware of the perfection of the right at that time.

In that situation, the simplest approach to disposal of the issues in this case is that taken by Mr Upton, namely, that there was no evidence to show that the respondents relied in any way on any waiver by the applicant. Even if all that is required is for the respondents to show that a point had arrived when they treated the applicant's actings as a waiver of his rights, we are not satisfied that there is evidence which would justify such a finding. It became clear that, however the matter was expressed, the respondents' assertion of waiver rested, wholly or in substance, on lapse of time. In submitting that the Tribunal could draw an objective inference of waiver by the beginning of 1997, Mr Dewar may reasonably be taken to concede that he was unable to suggest that the respondents had, in point of fact, reached a conclusion at such time that the applicant had given up any right. No doubt the applicant's actings could be seen as based on his desire to buy rather than on his assertion of a right to buy. Mr Dewar did found strongly on that distinction in his analysis of the evidence of the applicant's actings. However, we are not persuaded that such distinction was clearly in the mind of either party at any time relevant to the issue of waiver. In any event, there were no positive actings indicative of an intention to abandon a right.

It follows that if the respondents are required to go further than simply showing that they treated the applicant's actings at some relevant time as equivalent to abandonment of his right to buy, they have failed to do so. They have not shown that they conducted their affairs in any way at all on the basis that Mr Graham had waived his rights. There was no evidence that the respondents' actings, assessments, or even thoughts had, in any positive way, been influenced by the actions of the applicant.

The only evidence of how the respondents in fact reacted to his application came from Mr Macleod. He had been told that "the matter had been dealt with and that Mr Graham had been informed". It is plain that this gives no support whatever to any element of waiver. It suggests positive actings by the respondents in face of an assertion of right. At best for the respondents it indicates that some period of time elapsed after the respondents told the applicant of their refusal and that they were not aware that he had taken any steps in response to such refusal. There was no evidence that he was ever told of the refusal. As far as the respondents are concerned the evidence demonstrates that they acted in reliance on having dealt with the matter themselves without regard to the applicant's actings or intentions. Mr Macleod's evidence of a review in late 1998 to consider, amongst other things, whether there was a statutory right to buy, supports the view that the respondents had not given thought to the applicant's legal rights when dealing with his application.

It can be said that the only established consequence of treating the application as having been determined was that it was "filed". An inference which might be drawn from this term is that the respondents recognised that it was still live. It had to be kept in a proper place in case their policy changed. However we place no weight on this. It is simply indicative of recognition of the applicant's desire to buy and we accept that this can be distinguished from assertion of right. The only other direct evidence bearing on the respondents' actings relative to the question of the applicant's right to buy came again from Mr Macleod who was invited to respond to the hypothetical question of the effect on the respondents' housing stock if the applicant's house required to be sold to him. He said there was a possibility that some other lower grade property might have to be upgraded to replace it. He thought it unlikely that a new house would be purchased to replace it. This evidence was expressed in the most general terms. We observe that there was evidence that the house at 7 Logan Drive had been declared surplus to requirements and was, at the date of the hearing, being advertised for sale. If the respondents were currently in any way anxious about housing stock they would, no doubt, be able to retain that house pending a decision in the present case. The fact that there was no suggestion of any administrative issue dependent upon the present case simply reinforces the absence of any evidence of the respondents depending in any way on an earlier waiver. It is, of course, accepted that it is unnecessary to consider prejudice.

On the whole evidence it is clear that Mr Upton's submission is well founded in fact. The respondents, throughout the relevant period, proceeded on the assumption that Mr Graham had no rights. They did not require to deal formally with his application. His own attitude to the application was irrelevant to their approach. However it was well known that he did wish to buy his house.

Before turning to consider the legal submissions it may be noted that Mr Upton dealt in some detail with the possible arguments arising from the fact that Mr Graham had made a second application. There was, he submitted, no evidence that the respondents in any way relied on that, in itself, as a waiver of rights arising from the first. If it was simply an adminicle of evidence supporting an earlier waiver it had to be seen in context. It was made very shortly after the applicant had applied to the Tribunal to try to enforce the first application. He had actively tried to get details from the respondents in relation to that application but had been told it could not be traced. Although the expression "belt and braces" might not be appropriate, the intention of the applicant was quite obvious. He would have to proceed with the second application if it proved impossible to go ahead with the first. This did not support any inference that he had intentionally given up his rights under the first application. We entirely agree with that submission.

Two broad issues of law were canvassed by counsel: the implication of the lapse of time taken against the various time scales which do appear in the Act; and the need for evidence of actings by the respondent in reliance on waiver.

In relation to the general issue of lapse of time, we are satisfied that although there might seem to be an element of common sense in Mr Dewar's submission that a tenant should not be allowed to delay indefinitely the stage of making of an application to the Tribunal, the submissions on behalf of the applicant are nevertheless well founded in law. The proper inference to be drawn from the absence of any time limit in respect of the right to apply to the Tribunal under section 71 compared with the strict timetables for other procedures, is that Parliament did not intend any short limitation period. Of more significance, however, is the fact that, in absence of a statutory limitation, we cannot create one. There is no underlying principle of common law that such rights must be exercised within a reasonable time although failure to do so may, of course, be an adminicle of evidence in support of some other plea.

It is well established that a plea of mora cannot, of itself, create a bar. The well known dictum of Lord Dees in that connection seems to us to be entirely apposite to waiver: "There must either be prescription or not. We are not to rear up new kinds of prescription under different names": MacKenzie v Catton's Trustees 1877 5R 313. It is, of course, also clear that if there has been substantial delay little else may be required as a basis of a plea of waiver or acquiescence. What constitutes substantial delay will always be a question of circumstances. It is difficult to envisage circumstances in which any reliance could be placed on the existence of prescribed short periods for various other purposes in the Act. Any suggestion that an approach to section 71 should be coloured by the proximity of sections with short timetables is countered the inference to be drawn by way of contrast. The lapse of time in the present case is not, in our view, accompanied by sufficient evidence of other circumstances to justify any finding of waiver.

In relation to waiver itself, it is not disputed that the decision in Armia Ltd v Daejan Developments Ltd, supra, provides binding guidance as to the principles to be applied in Scots law. It is also clear that although we may be entitled to disregard decisions which are inconsistent with it, we must accept the binding force of Inner House decisions which purport to explicate it. Parties were agreed that in a case of waiver it was unnecessary for the party claiming benefit to have acted to his prejudice in reliance on the waiver and that the plea was not based on equitable considerations.

The relevant dicta can be found, firstly, in the speech of Lord Fraser of Tullybelton at page 69 where he quotes from Banning v Wright [1972] 1 WLR 972:

"Lord Hailsham of St Marylebone LC, at 979C, said this: "In my view, the primary meaning of the word 'waiver' in legal parlance is the abandonment of a right in such a way that the other party is entitled to plead the abandonment by way of confession and avoidance if the right is thereafter asserted."

In the same case Lord Reid at 981D said: "It [waiver] always, I think, involves the idea of giving up or abandoning some right or rule".

In W J Alan & Co Ltd v El Nasr Export & Import Co [1972] 2 QB 189, 213A, Lord Denning MR expressed the opinion that it was not necessary for the party relying on the waiver to have suffered prejudice by his reliance, but that it was enough if he had conducted his affairs on the basis of the waiver. In the present case the reason why the plea of waiver fails is not that the respondents suffered no prejudice but that the appellants never abandoned their right to refuse the title offered and the respondents never conducted their affairs on the basis that they had. The respondents' position all along was that the appellants did not have the rights which they claimed".

It is plain that Lord Fraser accepted a need for positive proof that the respondents conducted their affairs on the basis of the waiver. The final sentence, quoted above, supports the view that there must be some change of attitude. Mr Upton's primary submission in this case is supported by the terms of that sentence.

Before looking at the conclusion reached by Lord Keith of Kinkel, as to the nature of waiver, it is important to look at the context in which his conclusion is expressed. At page 71 Lord Keith repeated the formulation of Lord Denning quoted by Lord Fraser and went on: "Counsel was particularly concerned to carry the contention that it is sufficient for the party relying on a plea of waiver to establish that he has acted in some way in reliance on a belief induced by the words and conduct of the other party, and that he need not show that he has acted to his prejudice".

In course of his examination of the issue, Lord Keith repeated the observation that: "The word 'waiver' connotes the abandonment of a right" (page 72). He expressed his conclusion thus: "I conclude from these cases that the question of whether or not there has been waiver of a right is a question of fact, to be determined objectively upon a consideration of all the relevant evidence". He then went on to examine the evidence and concluded that the conduct relied on did not support any implication of waiver.

It can be seen that, having referred to counsel as being concerned to carry the contention that there was no need to show prejudice, Lord Keith dealt with the matter in a way which demonstrates a view that it was completely unnecessary to have regard to the respondents' reaction to the alleged waiver. If waiver is an abandonment and the question is of fact, it must be the inference to be drawn from the actings of the party allegedly abandoning the right which constitutes the fact. Accordingly, we consider that Lord Keith's position must be understood as being that evidence of the nature of the other party's reaction to waiver is irrelevant.

In Lousada & Co Ltd v J E Lesser (Properties) Ltd, supra, the Lord Justice-Clerk (Ross) after referring to Lord Keith as having pointed out that "waiver" connoted the abandonment of a right, said: "In the present case there was no question of express abandonment of the right, and accordingly, the question was whether it could be inferred from the facts and circumstances averred that the defenders had abandoned their right to resile". Clearly this passage supports the view that the relevant "fact" is the inference to be drawn from the actings of the party alleged to have abandoned his right. However, Lord Ross went on to say:

"Moreover it was recognised in the speeches in Armia Ltd v Daejan Developments Ltd that it must be shown that the pursuers had altered their position in reliance upon the alleged waiver on the part of the respondents. Counsel accepted that it was not necessary to show that the pursuers had acted to their prejudice but he contended that it was necessary to demonstrate that the pursuers had acted in some way in reliance on a belief induced by the alleged conduct of the defenders.

In my opinion senior counsel for the defenders was well founded in making these submissions and it is necessary to consider whether it can properly be inferred from these averments that the defenders were abandoning their right and whether the pursuers had acted in reliance upon a belief induced by the conduct of the defenders".

It is not clear which passages in the speeches in the Armia case were relied upon by Lord Ross as a recognition that the benefited party must be shown to have altered its position and we have difficulty in finding any such recognition in the speech of Lord Keith. It can be said that use of the word "recognised" may imply that the need for alteration of position in reliance on waiver was well-established prior to that case and needed little more than passing acknowledgement. If so, Lord Fraser's plain acceptance of a need for "conducting affairs in reliance" could, no doubt, amount to recognition of a need for alteration of position.

In light of the speech of Lord Fraser - with whom the other judges concurred - and the Scottish authorities cited to us, it would not be possible for us to go as far as to treat Lord Keith's speech as authority for completely disregarding the actings of the respondents as relative to formal constitution of a waiver. In any event, in a bilateral relationship, it seems clear that for the waiver to be effective the other party must be aware of it. Even an express written waiver would be ineffective if recalled before being communicated. Where the waiver is express no difficulty in proof of communication, or proof of what is being communicated, will normally be anticipated. However, where waiver is alleged to arise from actings, the reliant party cannot be said to have received intimation of a waiver unless that party has in some way recognised the actings as amounting to waiver. To say that the benefited party must have "conducted his affairs" on the basis that the actings of the other amounted to a waiver, does not necessarily connote any more than that an alleged beneficiary must show that he treated the actings as a waiver. If there is no need for proof of prejudice, proof that they treated the actings as waiver or abandonment should be a question of their attitude rather than their actings. There was discussion in the course of submission, of an example of a minute of a meeting of the respondents simply recording that Mr Graham could be taken by his actings to have abandoned his right to buy. If waiver is essentially a matter of fact it is difficult to see any basis in theory requiring any more positive conduct on the part of the benefited party. Recognition of waiver could well have the identifiable effect of removing an element of doubt or anxiety so that the beneficiary could properly be said to conduct his affairs thereafter on the basis of the waiver even if he could not point to any specific change directly attributable to it.

In Barratt (Scotland) Ltd v Keith (at page 1342H) Lord Penrose referred to the need for averments of "some overt acceptance of the waiver". The term "acceptance" would tend to imply characteristics going beyond mere recognition. It suggests that the party waiving has to know of the beneficiary's response and we find no warrant for this in the dicta in Armia Ltd v Daejan Developments. The dictum comment must, accordingly, be treated with caution although it does at least suggest a theoretical basis for a requirement of evidence of the actings of the benefited party. A test based simply on acceptance would not require evidence of any positive change of conduct on the part of the benefited party.

In many cases there will be no difference between a test based on conducting one's affairs in reliance on waiver and a test based on alteration of position in reliance on it. If no element of prejudice is required, little else may be needed. The present case does, however, illustrate a particular problem as, indeed, does the final sentence from Lord Fraser to which we referred above. It may be thought that disputes over the alleged abandonment of a substantive right would be most likely to arise in circumstances where the existence of the right was, in itself, contentious. If a defender had always maintained the position that a pursuer did not have the right he claimed and the pursuer came to the view that there was no point in pressing the matter, the doubt or dispute as to the existence of the right would have two relevant consequences. It would provide evidence of a motive in light of which the pursuer's conduct could be examined. It might more easily be inferred that he had intended to give up a right which he knew to be doubtful or capable of challenge than to give up one which was clear. On the other side, if the defender had always been confident in his view that there was no right, intimation of abandonment could not be expected to produce any change in his conduct of his affairs. To require proof of positive actings in reliance on an apparent abandonment of a "hopeless" claim would, paradoxically, make abandonment of such a claim more difficult to establish than abandonment of a realistic claim. No such difficulty would arise if waiver required, first, the test of whether the established actings of the one party were such as to allow an inference to be drawn that he had in fact abandoned his right and, second, the test of whether the actings of the potentially benefited party were such as to show that that party did in fact draw that inference.

Although the decision in Armia v Daejan clearly requires proof of some conduct of affairs in reliance on the waiver, it may not go as far as requiring proof of a positive alteration or change. In particular, we doubt whether it can be seen as requiring actings of the nature suggested by way of example by the Lord Justice-Clerk in Morrison's Executors v Rendall 1986 SLT 227. In that case, in the context of an alleged abandonment of lease, it was suggested that the position might have been different if the landlord had advertised the subjects for sale or had accepted an offer from a third party for the sale of the subjects with vacant possession. Such actings would, no doubt, clearly justify the inference that the beneficiary had conducted his affairs on the basis that the actings amounted to waiver. The same conclusion could, however, come from direct evidence of that party's attitude to the actings in question.

We have noted with interest the dicta in Presslie v Cochrane McGregor Group Ltd 1996 SC 289 at 291 H-I and dicta in James Howden & Co Ltd v Taylor Woodrow Property Co Ltd 1999 SLT 841 D-F. These suggest that, in an appropriate case, further examination will be required of the nature of waiver in Scots law. The plea in essence is that where a party has elected to give up a right, he should not be allowed to re-assert it. Once the underlying justification for such a plea is clarified, the proper test to apply to the benefited party's position will be more easily determined. On our view of the facts in the present case, waiver by the applicant has not been proved and these issues do not arise. We are, in any event, bound by the decision in Armia v Daejan as interpreted in the Lousada & Co Ltd case. Nothing amounting in any way to reliance on the applicant's actings has been proved.

We accordingly make a formal finding that there has been a failure by the landlord respondents and that the stage has been reached when the Tribunal should proceed to take the necessary steps leading to issue of an offer to sell. However, at the request of parties we shall now sist the cause to allow these matters to be resolved amicably or for the respondents to take such further steps as seem to them to be appropriate. It should be made clear that, as matters stand, the applicant has a right to seek to recall the sist at any time.