Premises divided up into self-contained holiday flats not entitled to domestic rate relief, at all events where it is their owner that is rated
This was a
claim by Mr William Joseph Skittrall, of Tudor Lodge, The Avenue, Brentwood,
Essex, against the South Hams District Council for a declaration that certain
holiday flats owned by him at Thurlestone and West Charleton, Devon, were
subject to domestic rate relief.
G Seward
(instructed by Collyer-Bristow & Co, agents for Rossetti & Peppercorn,
of Kingsbridge) appeared for the plaintiff, and D Widdicombe QC and J Hodgson
(instructed by Sharpe, Pritchard & Co, agents for the solicitor to the
council) represented the defendants.
Giving a
reserved judgment, FOSTER J said that Mr Skittrall was the owner of Hope Cottage,
Thurlestone, Devon, which he had converted into four self-contained holiday
flats, and West Charleton Court, West Charleton, Devon, which consisted of
several blocks each containing self-contained flats; there were 32 flats in
all, and there were certain communal rooms, such as a TV room. All the flats
were furnished and were let during the summer to holiday-makers for periods
from one to four weeks. During the winter a flatlet was sometimes let for
longer periods such as one or two months. It was common ground that the
plaintiff was rated as the occupier of each property, that he had paid the
rates on each of the properties and that he was in fact the rateable occupier,
the holiday tenants’ residence as visitors containing no element of permanence.
The question for the court was whether as a matter of construction the
properties came within section 48 of the General Rate Act 1967, which provided:
(1) Every rating authority shall reduce the
amount which, apart from this subsection, would be the amount of the rate
levied by the authority for any year on any dwelling-house . . . in their area
by the following amount in the pound, that is to say (a) in the case of a
dwelling-house, the amount prescribed for that year in pursuance of paragraph 1
of Part III of Schedule 1 to the Local Government Act 1966. . . .
In the
definition section of the Act, section 115 (1) ‘dwelling-house’ was defined as
‘a hereditament which, in accordance with schedule 13 to this Act, is used
wholly for the purposes of a private dwelling or private dwellings,’ and
‘hereditament’ was defined as a ‘property which is or may become liable to a
rate, being a unit of such property which is, or would fall to be, shown as a
separate item in the valuation list.’
The definition of dwelling-house led one to the 13th schedule, paragraph
1 of which stated that the schedule was to have effect for the purpose of
determining whether any hereditament or premises was or were being used wholly
for the purposes of a private dwelling or dwellings. Paragraph 2 stated that
‘If in the case of a hereditament . . . used for the letting of rooms singly
for residential purposes there is used for such lettings the whole, or
substantially the whole, of the available accommodation . . . then unless the
whole, or substantially the whole, of that available accommodation consists of
dwellings [falling within categories which were agreed to be irrelevant] the
hereditament shall be deemed not to be used for the purposes of a private
dwelling or private dwellings. . . .’
It was
submitted for the plaintiff that a family on holiday was using a flat as a
private dwelling-house, and reliance was placed on Railway Executive v Baker
(VO) and Working UDC (1952) 23 DRA 214. But the main argument
advanced
premises where rooms were let singly, it followed that where the court found
premises where more than one room was let, such premises must be included in
the definition of ‘private dwelling-house.’
It was to be noted that the letting of holiday accommodation did not get
any protection under the Rent Act 1974, and he (his Lordship) thought that
similarly the winter lettings in this case did not get such protection. Counsel
for the plaintiff also relied on Guardians of the Poor of the Parish of
Bristol v Bristol Waterworks Co [1914] AC 379 HL, but that only
decided that a workhouse was not a private dwelling-house. He (counsel) also
relied on the decision in Harding v Hagg (1958) 3 RRC 336, where
on the particular facts in that case certain beach huts were held to be
dwelling-houses. Counsel for the defendants pointed out that section 48 and the
13th schedule were largely based on similar provisions in the Valuation for
Rating Act 1953, and accepted as a fact that it was a matter for the rating
officer to decide into which class a property fell, though the valuation
officer was under a duty to certify the number of private dwelling-houses
entitled to a reduction to the Department of the Environment. He (counsel)
submitted that in deciding whether these properties were wholly used for the
purpose of private dwelling-houses the court had to look at the use which was
made of the properties by the person who was the rateable occupier. In the
present case the plaintiff was admittedly the rateable occupier of the
properties and the use he made of them was relevant. Counsel relied for this
approach on three decisions of the Lands Tribunal under the 1953 Act, Warwickshire
County Council v Jones (1959) 5 RRC 318, Harrison v Rolls-Royce
Ltd (1959) 6 RRC 40 and Pollard v Congregation of Christian
Brothers of Ireland (1960) 7 RRC 258.
Those
decisions were not binding on the court, but in each the question posed was the
purpose for which the rateable occupier used the premises. Also in Glasgow
City Corporation v Johnstone [1965] AC 609 the House of Lords, in
deciding whether a property was used mainly for charitable purposes, posed and
answered the question, what use is the charity making of it? He (his Lordship) accepted the defendants’
submissions, and if the test was the use the plaintiff was making of the
properties there could only be one answer: he was carrying on the business of
letting holiday flats, whether for gain or not did not matter. He (Foster J)
was fortified in this view, since it was difficult to believe that Parliament
ever intended that a person carrying on a commercial enterprise should be
entitled to partial or any relief from rates.
The action
was dismissed with costs.