Rating surcharge on property not used for purpose for which it was constructed–Unoccupied premises–No rates payable–Question of liability to surcharge–Liability not contingent on occupation–Case sent back to justices
This was an
appeal by way of case stated against the dismissal by Suffolk justices of a
complaint by Eric Kendall Dixon on behalf of Ipswich Borough Council that
Lenore June Harding and three others had failed to pay a rating surcharge under
section 17A of the General Rate Act 1967 on commercial property at 21 St
Margaret’s Green, Ipswich.
A Fletcher
(instructed by Sharpe, Pritchard & Co, agents for the town clerk of
Ipswich) appeared for the appellant, and N Nardecchia (instructed by Gotelee
& Goldsmith, of Ipswich) represented the respondents.
Giving the
judgment of the court, SLYNN J said that this was an appeal by way of case
stated in respect of the adjudication of justices for the county of Suffolk
sitting at Ipswich on February 10 1976. On December 17 1975 a complaint had
been made by the appellant, acting on behalf of Ipswich Borough Council, that
the respondents had failed to pay a rating surcharge totalling £1,048.17
alleged to be owed in respect of certain unused commercial property at 21 St
Margaret’s Green, Ipswich, for a period from February 8 1974 until September 30
1975. Liability to a progressive surcharge was imposed by section 17A of the
General Rate Act 1967, which section was added to the General Rate Act by the
Local Government Act 1974, section 16. For the purposes of the hearing it had
been admitted that the property was a commercial building that had not been
used for the purpose for which it was constructed or adapted for a continuous
period of six months. It was further admitted that the respondents were the
persons liable to pay any rates due in respect of the property, that neither
the respondents nor any other persons had been in occupation of the property
during the relevant period and that no rates were payable in respect of the
property during the relevant period.
On these facts
the appellant had contended that the respondents were liable to the surcharge
in accordance with the section and that the surcharge fell to be calculated by
reference to the notional figure of the rates which would have been payable had
the building been occupied. The respondents’ case was that, since no rates were
payable during the relevant period, there was no normal rate which could have
been taken in order to achieve the figure by way of surcharge. The essence of
that case had been that no surcharge could be made under section 17A in respect
of unoccupied property unless a resolution had been passed by a rating
authority, under section 17, bringing into operation the provisions of Schedule
1. No resolution had been passed during the relevant period in respect of this
area, although subsequently it was resolved that Schedule 1 to the Act should
apply from April 1 1976.
In their
Lordships’ judgment the effect of section 17A was that, so far as a surcharge
was concerned, the amount was to be the same whether or not the owner was in
occupation and was to be based upon the rates ordinarily payable when the owner
was in occupation. The respondents’ argument was that, since no rates had been
payable, the normal rates were in effect nil, so that there could have been no
surcharge. This ignored the provisions of subsection 4 (a) that when an owner
is not in occupation during the period of non-use the amount of the surcharge
shall be the same as if the owner had been in occupation. Their Lordships did not
consider that it was a precondition to liability under section 17A in respect
of unoccupied property that a resolution should have been passed under section
17. The two sections were, in their judgment, dealing with different matters.
Accordingly, in their judgment, whether section 17A was looked at in isolation
or in conjunction with section 17, the premises in the present case were liable
to the surcharge despite the fact that no rates were payable because the
property was unoccupied.
The appeal
should be sent back to the justices with a direction for the hearing to
continue.
