Slurry rules and section 11 – guidance for landlords

Although the 'SSAFO' (Water Resources (Control of Pollution) (Silage, Slurry and Agricultural Fuel Oil) (England)) Regulations have been with us since 2010, it was the Environment Agency's 2024 publication, 'Harvesting Success' that clarified that the minimum slurry storage capacities required by law – four months' worth (or, for those parts of the country classed as Nitrate Vulnerable Zones, six (for pigs and poultry) or five (for other livestock)) – must be calculated without relying on a slurry separator. This, taken together with increased concerns about water quality and pollution generally, means that slurry storage and management is now attracting far greater scrutiny from the Environment Agency.

This increased focus will concern farmers whose infrastructure may be groaning at the edges and potentially non-compliant – new kit is expensive, and grants are limited. What should landowners consider when faced with a tenant farmer asking for help?

Repair or replace?

The first question is whether the work being proposed would constitute either a repair or a replacement of existing infrastructure, and if so, does the tenancy agreement cover it, and whose responsibility is it? If it is not addressed expressly in the agreement, do the Model Clauses apply and what do they say? Both the 1973 and 2015 versions oblige the landlord to repair and replace slurry systems (excluding covers), but the tenant is obliged to keep them clean and in good working order (as well as to repair and replace covers).

Or is it an improvement?

Alternatively, if what is being requested is an improvement, then generally the landlord and tenant can agree between themselves what work will be carried out and at whose cost. Although treatment will differ slightly according to whether the tenancy is a Farm Business Tenancy (FBT), or governed by the Agricultural Holdings Act 1986 (1986 Act), where the tenant part-funds the work, it must be agreed whether it will be treated as a tenant's fixture (in which case the tenant may be entitled to remove it at the end of the term), or improvement (in which case the tenant may get compensation instead). Where the landlord part-funds the work, will it be recognised in future rent reviews as a landlord's fixture, or is an improvement finance agreement required to ensure a sufficient return on capital for the landlord and record compensation for it at the end of the term? Regardless of what is agreed, it is vital to record – in writing – how it should be treated in the future.

Section 11 (is not for the fainthearted)

Where the tenant is requesting an improvement, and the tenancy is governed by the 1986 Act, section 11 must also be considered. This gives the tenant a means to apply to the tribunal for a direction that the landlord must provide fixed equipment, where the tribunal is satisfied it is reasonable to do so, to permit them to continue a specified agricultural activity on the holding without contravening regulatory requirements. Although rarely used in the past, section 11 has recently become a focus of interest with dairy farmers in particular, in light of slurry storage regulations. Landlords should not worry unduly, however. The section 11 test sets a high bar for the tenant, and key considerations include the reasonable, future use of the holding (is the holding of a sufficient size to be viable for dairy use in the long term?), and whether the capital investment is consistent with the landlord's future plans for the holding (are they planning to amalgamate it with nearby land, reduce the size of operations on the holding, or change its use entirely?).

Given the changing face of agriculture and, especially, the changing economics of dairy farming, it may be difficult for a tenant to argue there is a realistic future for their 'specified activity' on the holding, which would justify the tribunal mandating the proposed investment under section 11. For this reason, and especially in the teeth of understandable opposition from a landlord, section 11 can be a high-risk strategy that may damage the landlord/tenant relationship.

As is so often the case, the best approach for landlords and tenants is to sit down, talk it through, and try to reach a mutually agreeable compromise in a spirit of partnership.

This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.

© Farrer & Co LLP, September 2025