Rating – Non-domestic rates – Proposal – Appellant appealing against decision of Valuation Tribunal for England that electronic proposal to reduce rateable value of property invalid – Whether failure to specify rent and mis-description of ratepayer as “owner/occupier” making disposal invalid – Whether proposal substantially compliant with requirements of regulation being valid – appeal allowed
The appellant was the proprietor of a restaurant on the ground floor of 32 Wellington Street, in Luton. There were other restaurants and shops in the same street and the prevailing tone of the 2010 Rating List was well-established. On 3 June 2013 he took a lease of the property for a term of 15 years at a rent of £17,000 a year. On 31 March 2015 his agents submitted an electronic proposal to reduce the rateable value of the property from £12,000 to £1. The proposal stated correctly that the appellant was the occupier of the property but also stated that the property was “owner/occupied” because of a misunderstanding between the appellant and his agent. As a result, the agent did not include any information in response to the question “if not owner/occupied, is a rent or licence fee paid?” and, in particular, did not state the rent payable, the date it had first become payable and the date of the next rent review, all of which was information required by regulation 6(3) of the Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009.
An issue arose concerning the consequence of the appellant’s mis-statement of the capacity in which he occupied the property and the omission of any information about the rent payable. The Valuation Tribunal for England (VTE) found that the proposal was invalid because, in whatever circumstances, to omit the rent from the proposal was a substantial failure to comply with the Regulations. Therefore, the error was so fundamental that the proposal could not be treated as valid.
The appellant appealed to the Upper Tribunal. The parties agreed that if the proposal was valid, the rateable value of the property should be altered from £12,000 to £10,250 with effect from 1 April 2010.
Held: The appeal was allowed.
(1) The proper approach to the validity of a proposal to alter the rating list laid down by regulation 6 of the 2009 Regulations was the same as was taken by courts and tribunals to the consequence of procedural errors in other statutory contexts. There were no special rules for rating. Where a statute laid down a process or procedure for the exercise of some right conferred by the statute, and the statute did not expressly state the consequence of failing to comply with that process or procedure, the modern approach was to determine the consequence of non-compliance as an ordinary issue of statutory interpretation. It invariably involved, among other things, according to the context, an assessment of the purpose and importance of the requirement in the context of the statutory scheme as a whole. In cases in which the decision of a public body was challenged or which concerned procedural requirements for challenging a decision, the courts asked whether the statutory requirement could be fulfilled by substantial compliance and, if so, whether on the facts there had been substantial compliance, even if not strict compliance: R v Soneji [2006] 1 AC 340 applied. Natt v Osman [2015] EGLR 11 and Elim Court RTM Company Ltd v Avon Freeholds Ltd [2017] PLSCS 46; [2018] QB 571 followed. R v Secretary of State for the Home Department ex p. Jeyeanthan [2000] 1 WLR 354 considered.
(2) The nature of the error in the notice was not apparent on its face, or from information which might readily have been to hand, and the VO was under no duty to investigate whether what the proposer said about his status was correct. The appellant need only substantially comply with the requirements of regulation 6 and not every omission or error would be fatal to its validity. Section 55 of the 1988 Act gave power to the secretary of state to make regulations providing for the alteration of rating lists. Those regulations might make provision as to who (other than a valuation officer) might make a proposal for the alteration of a list “with a view to its being accurately maintained” (section 55(4)(a)). The 2009 Regulations were made under the power conferred by section 55 and it was relevant to bear in mind that the role of the proposal was to improve the list by enabling it to be made more accurate. The question whether a proposal was valid or invalid had to be determined in light of the particular proposal and the circumstances in which it was made. In cases such as the present, it would always be necessary to identify the requirement which had not been complied with and the extent to which information had not been provided, but once that had been done it was necessary to consider whether that degree of compliance was sufficient in the circumstances to amount to substantial compliance with the procedural requirements as a whole: Kendrick (VO) v Mayday Optical Co Ltd [2013] UKUT 548 (LC); [2014] PLSCS 20 followed. Tuplin (VO) v Focus (DIT) Ltd [2009] UKUT (LC) 118; [2009] PLSCS 278 distinguished. Newbold v The Coal Authority [2013] PLSCS 115; [2014] 1 WLR 1288 considered.
(3) The appellant’s description of himself as an “owner/occupier” did not mean that the proposal failed to comply with the requirements of the 2009 Regulations. Regulation 6(1) required only that it be made by notice to the VO and contain certain information. Regulation 6(3)(a) required only that “where the proposer is the occupier” the proposal had to include “the amount payable each year by the occupier, as at the date of the proposal, in respect of the lease, easement or licence to occupy”. The appellant was the occupier, and he was therefore required to state the amount payable by him each year under his lease. His proposal was non-compliant because of the omission of that information, but not because of his description of himself as “owner/occupier”. The appellant’s concern was that there had been an error in applying that tone of the list to his premises because the conventional approach to zoning had not been adopted. The proposal was substantially compliant with the requirement of regulation 6, notwithstanding its failure to state the rent and was valid.
Louise Wise (of Relatus Ltd) appeared for the appellant; Jacqueline Lean (instructed by HM Revenue and Customs) appeared for the respondent.
Eileen O’Grady, barrister
Click here to read a transcript of Alam v Stoyles (VO)