Rating – hereditament – Warehouse – Valuation officer entering four newly erected warehouse buildings in 2005 rating list – Units having no small power distribution and only limited lighting in warehouse areas and no partitioning of office space – One unit having no connection to gas supply – Whether units constituting rateable hereditaments to be entered in rating list – Appeals allowed
The appellants owned four speculatively built Warehouses in Reading and Milton Keynes. Before any completion notices had been served the respondent valuation officers entered each of the units in the 2005 rating lost for the relevant borough councils. The valuation tribunal subsequently held that units satisfied the requirements necessary for inclusion in the lists and upheld the entries. The appellants appealed.
At the date of their inclusion in the lists, the units had reached practical completion and the construction personnel appointed by the appellants had left the sites. However, the units had no small power distribution and only limited lighting in warehouse areas and no partitioning of office space. One unit had no connection to gas supply.
Section 41 of the Local Government Finance Act 1988 required the valuation officer for a billing authority to compile and maintain a local non-domestic rating list for the authority’s area. Bt section 42, the rating list had to show each relevant non-domestic hereditament, defined by section 64(1) as “… property which is or may be liable to a rate, being a unit of property which is, or would fall to be, shown as a separate item in the valuation list.”
Where the work remaining to be done on a new building in its areas was such that the building could reasonably be expected to be completed within three months, the authority was required by paragraph 1(1) of Schedule 4A to serve a completion notice on the owner of the building, specifying a completion day for the new building. Where the completion notice procedure had been followed by a billing authority, section 46A of the 1988 Act had the effect, subject to any appeal, that the new building was deemed to have been completed on the date specified in the notice.
In present case, neither of the billing authorities had served completion notices at the time the units had reached practical completion. Therefore, the sole issue for the Upper Tribunal in the present case was whether each of the appeal properties had been ready for occupation on the date it was entered in the 2005 rating list.
Held: The appeals were allowed.
Where a billing authority omitted to serve a completion notice and a building remained unoccupied, it was a question of fact whether the building was completed to the point at which it had become a hereditament capable of being included in the rating list. A building was a hereditament only if it was ready for occupation for the purpose for which it was designed to be occupied. If the building lacked features that would have to be provided before it could be occupied for that purpose, and those features would, when provided, be part of the occupied hereditament and form the basis of its valuation, the building did not constitute a hereditament and did not fall to be shown in the rating list. There was no scope for including in the list a building that was almost ready for occupation unless the completion notice procedure had been followed: Porter v Trustees of Gladman SIPPS [2011] UKUT 204 (LC); [2011] PLSCS 179 applied.
The determination of the present appeals was a straightforward issue of fact which turned on the absence from the appeal properties of essential features, namely small power distribution, lighting and the gas connection necessary to supply hot water. In the light of all the evidence, including the comparables, additional lighting and power distribution on the warehouse areas were required before the appeal properties were ready for, or capable of, occupation. The same conclusion had been reached in respect of the absence of a gas meter and connection of a gas supply to the boiler of one of the units.
(per curiam) The issues which had arisen in these appeals would have been avoided of each of the billing authorities had served completion notices when the units reached practical completion. There was simply no need for disputes of this kind when the statutory scheme provided a reliable method of deeming a new building to be complete and capable of being entered in the rating list.
Daniel Kolinsky (instructed by IBB Solicitors and (by direct access) by Altus Edwin Hill, chartered surveyors) appeared for the appellants; Galina Ward (instructed by the Solicitor to HM Revenue and Customs) appeared for the respondents.
Eileen O’Grady, barrister
Aviva Investors Property Development Ltd and another v Whitby (Valuation Officer) and another
Rating – hereditament – Warehouse – Valuation officer entering four newly erected warehouse buildings in 2005 rating list – Units having no small power distribution and only limited lighting in warehouse areas and no partitioning of office space – One unit having no connection to gas supply – Whether units constituting rateable hereditaments to be entered in rating list – Appeals allowedThe appellants owned four speculatively built Warehouses in Reading and Milton Keynes. Before any completion notices had been served the respondent valuation officers entered each of the units in the 2005 rating lost for the relevant borough councils. The valuation tribunal subsequently held that units satisfied the requirements necessary for inclusion in the lists and upheld the entries. The appellants appealed.At the date of their inclusion in the lists, the units had reached practical completion and the construction personnel appointed by the appellants had left the sites. However, the units had no small power distribution and only limited lighting in warehouse areas and no partitioning of office space. One unit had no connection to gas supply.Section 41 of the Local Government Finance Act 1988 required the valuation officer for a billing authority to compile and maintain a local non-domestic rating list for the authority’s area. Bt section 42, the rating list had to show each relevant non-domestic hereditament, defined by section 64(1) as “… property which is or may be liable to a rate, being a unit of property which is, or would fall to be, shown as a separate item in the valuation list.”Where the work remaining to be done on a new building in its areas was such that the building could reasonably be expected to be completed within three months, the authority was required by paragraph 1(1) of Schedule 4A to serve a completion notice on the owner of the building, specifying a completion day for the new building. Where the completion notice procedure had been followed by a billing authority, section 46A of the 1988 Act had the effect, subject to any appeal, that the new building was deemed to have been completed on the date specified in the notice.In present case, neither of the billing authorities had served completion notices at the time the units had reached practical completion. Therefore, the sole issue for the Upper Tribunal in the present case was whether each of the appeal properties had been ready for occupation on the date it was entered in the 2005 rating list. Held: The appeals were allowed.Where a billing authority omitted to serve a completion notice and a building remained unoccupied, it was a question of fact whether the building was completed to the point at which it had become a hereditament capable of being included in the rating list. A building was a hereditament only if it was ready for occupation for the purpose for which it was designed to be occupied. If the building lacked features that would have to be provided before it could be occupied for that purpose, and those features would, when provided, be part of the occupied hereditament and form the basis of its valuation, the building did not constitute a hereditament and did not fall to be shown in the rating list. There was no scope for including in the list a building that was almost ready for occupation unless the completion notice procedure had been followed: Porter v Trustees of Gladman SIPPS [2011] UKUT 204 (LC); [2011] PLSCS 179 applied.The determination of the present appeals was a straightforward issue of fact which turned on the absence from the appeal properties of essential features, namely small power distribution, lighting and the gas connection necessary to supply hot water. In the light of all the evidence, including the comparables, additional lighting and power distribution on the warehouse areas were required before the appeal properties were ready for, or capable of, occupation. The same conclusion had been reached in respect of the absence of a gas meter and connection of a gas supply to the boiler of one of the units. (per curiam) The issues which had arisen in these appeals would have been avoided of each of the billing authorities had served completion notices when the units reached practical completion. There was simply no need for disputes of this kind when the statutory scheme provided a reliable method of deeming a new building to be complete and capable of being entered in the rating list.Daniel Kolinsky (instructed by IBB Solicitors and (by direct access) by Altus Edwin Hill, chartered surveyors) appeared for the appellants; Galina Ward (instructed by the Solicitor to HM Revenue and Customs) appeared for the respondents.Eileen O’Grady, barrister