The Upper Tribunal (Lands Chamber) has ruled that a completion notice addressed to “the owner” of a redeveloped building at 1 Kingsway, WC2, was valid to bring it into the 2010 rating list.
The UT allowed an appeal by Westminster city council against an earlier ruling that the notice, which did not refer to the owner by name, was not validly served.
The case concerned the formal validity and service of a completion notice under Schedule 4A of the Local Government Finance Act 1988 delivered by the appellant on 5 March 2012 in respect of premises on the 3rd-6th floors of a building at 1 Kingsway, London WC2. The completion notice purported to bring the premises into the 2010 rating list with effect from 1 June 2012.
In January 2009, freehold owner of the building UKI (Kingsway) Ltd commenced a redevelopment of the building behind the original facade. On completion the redeveloped building included 130,000 sq ft of office space, but UKI’s agent, Jones Lang Lasalle (JLL), could not reach agreement with rating authority Westminster city council on the completion date from which the premises would be brought into the 2010 rating list. The council asked JLL to confirm the identity of the owner of the building but JLL declined to do so without first obtaining instructions from its client, which were not forthcoming.
On 5 March 2012 a completion notice specifying 1 June 2012 as the completion date was delivered by hand to the building, where it was given to a receptionist employed by the facilities management company responsible for managing the building. The completion notice was addressed to the “Owner, 1 Kingsway, London WC2B 6AN”.
In the Valuation Tribunal last year, the president, Professor Graham Zellick QC, decided that the failure to identify the owner by name in the completion notice, and to address it to “the owner”, was fatal to the claim of effective service.
However, Martin Rodger QC, deputy president of the UT, overturned the decision, finding that service merely on “the owner” was valid in this case.
He said: “I am satisfied that the completion notice delivered to the building on 5 March 2012 was a valid completion notice, despite the fact that it did not identify the intended recipient by name. I would stress, however, in full agreement with the President, that the form of notice employed in this case is not a precedent which can be recommended. It has been the cause of very great expense and effort which could easily have been avoided if a more conventional approach had been taken.
“Even where building owners or their agents indulge in the sort of gamesmanship apparently resorted to in this case, it ought not to be difficult to establish the name and address of the owner by making an inquiry at the Land Registry or making use of the right conferred by section 16 of the Local Government (Miscellaneous Provisions) Act 1976 to require the provision of the information.”
Robert Hayton, national head of empty rates at Altus UK LLP, said that the decision would have “very significant repercussions for those undertaking speculative developments”.
However, he acknowledged that the case is facts sensitive, as it was evidentially clear that the owner in this case had actually received the completion notice, notwithstanding it being addressed generically and being handed to the receptionist.
He said: “The UT expressed difficulty in accepting that ‘where the vital information has successfully been imparted to the person who needs to receive it, and that person has acted upon it by exercising the right of appeal, the need for discipline and regularity in the exercise of the statutory power should be sufficiently powerful considerations to require that the recipient’s liability be determined on the basis that the information had never been received’.
“On the matter of delivery it said that the notice was not ‘handed to a complete stranger or to a third party with no relevant connection to the intended recipient’.
“It is clear, therefore, that there remains scope to argue that poor service of a completion notice is sufficient to render it invalid. What if the notice is served on an actual but incorrect company? What if, in similar circumstances, the receptionist doesn’t forward the notice or forwards it after an unreasonable delay?
“Those owners who have hitherto relied on such inaccuracies to defer the commencement of liability will in future need to properly assess the other aspects of the completion notice to ensure it is valid and, where it is not, make an appropriately worded appeal.”
He added: “In our experience, having reviewed and appealed hundreds of completion notices, it is prematurely deemed completion that is by far the most common flaw. Originally this was as a result of many billing authorities not understanding what complete for rating purposes meant. Today I suspect that it is pressure to secure new rates income that drives billing authorities, incentivised through the Localism Act, to adopt the deeming dates that they do.”
Westminster City Council v UKI (Kingsway) Ltd Upper Tribunal (Lands Chamber) (Martin Rodger QC) 28 July 2015
Sebastian Kokelaar (instructed by Head of Legal and Democratic Services, City of Westminster) for the appellant
Daniel Kolinsky QC (instructed by Jones Lang LaSalle) for the respondents
