The Administrative Court has rejected an appeal against a district judge’s decision that the appellants were the rateable occupiers of and liable for unpaid non-domestic rates in respect of two properties in Cardiff for 2018-20 in Queen Street Properties Ltd and another v Cardiff City and County Council [2022] EWHC 39 (Admin).
Philip Ryan was the sole director and shareholder of each appellant company which was the lessee respectively of properties in Queen Street and Churchill Way, Cardiff. The first appellant claimed that for the relevant periods the rateable occupier of the Queen Street property was Parc Lane Restaurant Ltd pursuant to a management agreement and licence of June 2018. Parc Lane, another company of which Philip Ryan was sole director and shareholder, was dissolved in September 2019. The second appellant claimed that for the relevant periods the rateable occupier of the Churchill Way property was CW18 Trading Ltd pursuant to a management agreement and licence of August 2018. CW18, another company of which Philip Ryan was the sole director and shareholder, was dissolved in November 2020.
The council argued, in each case, that the appellants had been in rateable occupation throughout and that references to Parc Lane and CW18 were ruses to avoid liability and the purported licences were a sham. Philip Ryan made a witness statement in respect of each property but failed to attend the hearing, the first appellant alleging in an email to the court the day before the hearing that to do so would be injurious to his health. The hearing proceeded in his absence. The district judge found the appellants to be in occupation of both properties and that both licence agreements were a sham.
The test of rateable occupation is that there must be actual occupation; it must be exclusive for the purposes of the possessor; the possession must be of some value or benefit to the possessor; and it must not be for too transient a period: John Laing & Son Ltd v Assessment Committee for Kingswood Assessment Area [1949] 1 KB 344.
The judge rejected the appellants’ arguments that the district judge had applied an impermissible presumption based on their respective ownership of the properties. In each case, the district judge undertook a detailed analysis of the questions of actual occupation. There was selective disclosure of documents concerning Parc Lane, the only sensible explanation for which was that undisclosed documents would undermine the first appellant’s position. There was a paucity of evidence concerning the business of CW18, with no accounting records, bank statements or payroll evidence. The district judge had drawn legitimate – indeed the only realistic – inferences from the circumstances.
As for the licence agreements, the district judge was entitled to take account of his findings regarding actual occupation as well as the terms and form of the licences, which he regarded as being “just for show”. Both were for unrealistic weekly rentals, which, had they been typing errors as the appellants alleged, would have been noticed and corrected, and the only identifiable signature on the licences was that of Philip Ryan.
Louise Clark is a property law consultant and mediator
