MacFarquhar and another v Phillimore and another; Marks v Phillimore and others

Leasehold Reform Act 1967 — Whether a retrospective reduction in rateable value can be taken into account in determining for the purpose of that Act whether the rateable value of a house exceeded the limit of £1,500 on April 1 1973 — Two appeals by freeholders raising the same point of law — Appeals were from decisions of county court judge holding in favour of the leaseholders that the rateable values of their houses did not exceed £1,500, so that they were entitled (subject to the fulfilment of any other conditions) to claim enfranchisement or an extended lease — There was no dispute that a reduction in rateable value on account of tenants’ improvements, following a certificate by a valuation officer, in accordance with section 1(4A) of the Leasehold Reform Act as amended, could be prayed in aid towards the achievement of the qualifying rateable value — In one of the cases, however, a further reduction of £179, as a result of a proposal by the valuation officer, had to be related back to April 1 1973, to bring the rateable value below £1,500 for the purpose of the claim to enfranchisement — This point gave rise to considerable difficulties of construction — In the end the|page:90| Court of Appeal unanimously affirmed the decision of the county court judge in favour of the leaseholders, but with some differences in reasoning both in relation to the judgment below and between themselves — Dillon LJ, after holding that neither a simple construction of section 79 of the General Rate Act 1967, as creating a general retrospective effect, nor a reliance on section 1(6) of the Leasehold Reform Act 1967 as amended produced a satisfactory solution, found assistance in the wording of section 37(6) of the latter Act, applying section 25(1) (2) and (4) of the Rent Act 1977 — Nicholls LJ preferred to base his decision on a consideration of subsections (5) and (6) of section 1 of the Leasehold Reform Act 1967 as amended and an implication from subsection (6) — Lloyd LJ, who gave no separate judgment, agreed not only with the common conclusion of both Dillon LJ and Nicholls LJ but also with the divergent reasoning of each, thus producing ‘a majority in favour of both views’ as well as unanimity in the result — Appeals dismissed No cases are referred to in this report. These were appeals by the landlords, trustees of settlements connected with the Phillimore family, from decisions of Judge Harris QC at West London County Court, in favour of leaseholders of houses at 55 Campden Hill Road (Roderick Lemonde MacFarquhar and Emily Jane MacFarquhar) and 9 Argyll Road (Jonathan Clive Marks), both in London W8. The MacFarquhars sought the acquisition of the freehold, Mr Marks an extended lease. Nigel Hague QC and David Neuberger (instructed by Frere Cholmeley and Baileys Shaw & Gillett) appeared on behalf of the appellants; J C Hicks QC and Oliver Ticciati (instructed by Compton Carr) represented the respondent leaseholders. Giving judgment, DILLON LJ said: The court has before it two appeals by the freeholder landlords against a decision of His Honour Judge Harris QC, given in the West London County Court on September 20 1985, on the hearing of two applications by the lease-holders of two houses in Kensington for relief under the Leasehold Reform Act 1967 as amended. Although each application relates to a separate house, the two were, by consent, taken together in the court below and in this court because they raise the same point of law, which the judge decided in favour of the leaseholders as a preliminary issue. Very broadly, the question is whether a retrospective reduction in the rateable values can be taken into account in determining for the purposes of the 1967 Act whether the rateable value of a house exceeded £1,500 on April 1 1973. One of the houses in question is 55 Campden Hill Road, London W8. The applicants in respect of this house are Mr and Mrs Roderick MacFarquhar, who hold the unexpired residue of a term of 63 years from March 25 1954, granted by a lease dated January 15 1954 at a yearly rent of £24. The rateable value of the house on March 23 1965 was £597. New valuation lists came into force nationally on April 1 1973 and the rateable value of this house was first entered in the new list at £1,784. However, the valuation officer made a proposal on May 24 1973 for a reduction in the rateable value on the ground that the assessment of £1,784 was incorrect and excessive. No objection was raised to this proposal and accordingly on July 26 1973 the valuation list was duly altered to show a reduced rateable value of £1,605. Under section 79 of the General Rate Act 1967, to which I shall have to refer, that reduction had effect for rating purposes from and including April 1 1973, which was the commencement of the then current rating year. The question for the appeal is whether it has a like retrospective effect for the purposes of the Leasehold Reform Act 1967. The reduction was granted as a temporary reduction because of building operations on a nearby municipal site, but Mr Hague for the freeholders accepts that nothing turns on the reduction having only been temporary. The reduced figure of £1,605 is, of course, by itself still above £1,500. However, on March 22 1984 the MacFarquhars applied to the valuation officer for a certificate under section 1(4A) of the Leasehold Reform Act 1967 as amended and para 3(ii) of Schedule 8 to the Housing Act 1974 (to which I shall have to refer) that a previous tenant had made improvements to the house and there should consequently be a reduction in the rateable value for the purposes of the Leasehold Reform Act. Such a certificate was granted on April 25 1984, reducing the rateable value by £113. It is common ground that this reduction of £113 relates back, for the purposes of the 1967 Act, to April 1 1973 and can be prayed in aid by the leaseholders to bring their house within the rateable value limits of the 1967 Act as amended. But of itself it is not enough for the MacFarquhars; to succeed in their objective of purchasing the freehold of their house under the 1967 Act as amended they must also be able to pray in aid the reduction from £1,784 to £1,605 which I have mentioned. The other house with which we are concerned is 9 Argyll Road, London W8. The applicant in respect of this house is Mr Jonathan Marks, who holds the unexpired residue of a term of 68 3/4 years from June 28 1928, granted by a lease dated March 1 1929 at a yearly rent of £15. The rateable value of this house at March 23 1965 was £555. When the new valuation list came into force on April 1 1973 the rateable value of this house was first entered in the new list as £1,763. But on February 19 1984 the valuation officer made a proposal that the assessment be amended to nil pending reconstruction of the hereditament (described as apartments and premises). There was no objection to that proposal, and the alteration in the valuation list to nil was duly made, with retrospective effect for rating purposes to April 1 1973. The question is again whether the alteration has retrospective effect to April 1 1973 for the purposes of the 1967 Act as amended. Mr Hague takes no point on the fact that the alteration was temporary, pending reconstruction, or on the fact that the reduction was to nil. As a matter of history, after the reconstruction had been completed, the rateable value of the reconstructed house was fixed at a figure under £1,500, but that was too late for Mr Marks’ purposes in relation to the 1967 Act as amended, as the proposal for the ultimate rateable value was made in a later rating year. Mr Marks in fact desires at present to acquire an extended lease of the house under the 1967 Act rather than to acquire the freehold, but nothing turns on that distinction. As I have mentioned, section 79 of the General Rate Act 1967 is the statutory provision which has the effect that, for rating purposes at any rate, an alteration in the rateable value of a hereditament relates back to April 1 at the commencement of the rating year in the course of which the proposal for the alteration was made. Section 79 provides that, subject to certain statutory provisions which are not material to this case: . . . in relation to any rate current at the date when the proposal in pursuance of which the amendment so made was served on the valuation officer, or, where the proposal was made by the valuation officer, current at the date when notice of the proposal was served on the occupier of the hereditament in question, that alteration shall be deemed to have had effect as from the commencement of the period in respect of which the rate was made, and shall, subject to the provisions of this section, have effect for the purposes of any subsequent rate. One of the arguments for the respondent leaseholders which the judge accepted, and which was indeed a principal reason in the judge’s decision in their favour, was that section 79 applies generally to give retrospective effect, to April 1 in the relevant rating year, to any alteration in the valuation list, and therefore applies to give retrospective effect to April 1 1973, for the purposes of the Leasehold Reform Act 1967, to the reductions of rateable value of these two houses which I have mentioned. For my part, however, I am wholly unable to accept that submission. Mr Hicks submits that the words in section 79 which I have quoted above — ‘in relation to any rate current at the date . . .’ — are merely directed to showing for how far back the alteration is to be retrospective, and not to showing the purposes for which it is to be retrospective; he says that it is to be retrospective for all purposes. But, in my judgment, the period for which the alteration is to be retrospective is provided for by the later words ‘that alteration shall be deemed to have had effect as from the commencement of the period in respect of which the rate was made’. The words ‘in relation to any rate current at the date . . .’ must therefore refer to the purpose for which the alteration is to be retrospective. The effect of those words and of the final words in the section is that it is to be retrospective in relation to any rate current at the date when the proposal was served and for the purposes of any subsequent rate, ie so far as this section goes, for rating purposes only. Section 79 shows that the general policy of the law is that alterations in the valuation lists are to be retrospective for rating purposes to the relevant April 1, but it does not help the leaseholders any further in this case. If the alterations are to be held retrospective for the purposes of the Leasehold Reform Act 1967, that must be because of something in that Act. |page:91| The Leasehold Reform Act as originally enacted plainly did not apply to these two houses. They come in, if at all, as a result of amendment of the Act by the Housing Act 1974. The scheme of the Act was, however, from the outset to enable tenants of houses held on long leases at low rents to acquire the freehold or an extended lease of those houses. Rateable value has always come in two ways; first, in that the houses to which the Act could apply were only houses, the rateable values of which did not exceed a certain sum on a certain date, and, second, in that the definition of a tenancy at a low rent was limited to tenancies under which the rent was not equal to or more than two-thirds of the rateable value at a certain date. For clarity, it is necessary to set out together the material provisions of those sections of the Leasehold Reform Act in its form as now amended which, in my judgment, are relevant to the determination of this appeal, viz section 1(1), (4) and (6), section 4(1) and section 37(6). But it is to be kept in mind that section 1(6), on which the respondent leaseholders must particularly rely, was introduced by amendment in the Housing Act 1974 and was not in the original Act. The references in the Act as now amended, and as set out below, to provisions of section 25 of the Rent Act 1977 were, of course, not in the original Act, but nothing turns on that, as the section which was referred to in the original Act, section 43 of the Rent Act 1965, was in precisely the same terms as section 25. The relevant provisions are as follows: 1(1) This Part of this Act shall have effect to confer on a tenant of a leasehold house, occupying the house as his residence, a right to acquire on fair terms the freehold or an extended lease of the house and premises where — (a) his tenancy is a long tenancy at a low rent and subject to subsections (5) and (6) below the rateable value of the house and premises on the appropriate day is not (or was not) more than £200 or, if it is in Greater London, than £400; and . . . (4) In subsection (1)(a) above, ‘the appropriate day’, in relation to any house and premises, means the 23rd March 1965 or such later day as by virtue of section 25(3) of the Rent Act 1977 would be the appropriate day for purposes of that Act in relation to a dwelling-house consisting of that house. (6) If, in relation to any house and premises, — (a) the appropriate day for the purposes of subsection (1)(a) above falls before 1st April 1973, and (b) the rateable value of the house and premises on the appropriate day was more than £200 or, if it was then in Greater London, £400, and (c) the tenancy was created on or before 18th February 1966. subsection (1)(a) above shall have effect in relation to the house and premises as if for the reference to the appropriate day there were substituted a reference to 1st April 1973 and as if for the sums of £200 and £400 specified in that subsection there were substituted respectively the sums of £750 and £1,500. 4(1) For the purposes of this Part of this Act a tenancy of any property is a tenancy at a low rent at any time when rent is not payable under the tenancy in respect of the property at a yearly rate equal to or more than two thirds of the rateable value of the property on the appropriate day or, if later, the first day of the term . . . For the purposes of this subsection — (a) ‘appropriate day’ means the 23rd March 1965 or such later day as by virtue of section 25(3) of the Rent Act 1977 would be the appropriate day for purposes of that Act in relation to a dwelling-house consisting of the house in question . . . 37(6) Section 25(1),(2),(4) of the Rent Act 1977 shall apply to the ascertainment for purposes of this Part of this Act of the rateable value of a house and premises or any other property as they apply to the ascertainment of that of a dwelling-house for purposes of that Act. It is not in doubt that the significance of the date April 1 1973 is that that is the date on which the new rating valuation lists came into force. It is also common knowledge that there was a large number of challenges to the accuracy of the assessments first entered in those lists which could not be resolved by alteration of the actual entries in the lists until some time after April 1 1973. But very many of these alterations would have been completed before the enactment of the Housing Act 1974, which introduced subsection (6) into section 1 of the 1967 Act. Section 25 of the Rent Act 1977 provides as follows: 25(1) Except where this Act otherwise provides, the rateable value on any day of a dwelling-house shall be ascertained for the purposes of this Act as follows: (a) if the dwelling-house is a hereditament for which a rateable value is then shown in the valuation list, it shall be that rateable value; (b) if the dwelling-house forms part only of such a hereditament or consists of or forms part of more than one such hereditament, its rateable value shall be taken to be such value as is found by a proper apportionment or aggregation of the rateable value or values so shown. (2) Any question arising under this section as to the proper apportionment or aggregation of any value or values shall be determined by the county court, and the decision of the county court shall be final. (3) In this Act ‘the appropriate day’ — (a) in relation to any dwelling-house which, on 23rd March 1965, was or formed part of a hereditament for which a rateable value was shown in the valuation list then in force, or consisted or formed part of more than one such hereditament, means that date, and (b) in relation to any other dwelling-house, means the date on which such a value is or was first shown in the valuation list. (4) Where, after the date which is the appropriate day in relation to any dwelling-house, the valuation list is altered so as to vary the rateable value of the hereditament of which the dwelling-house consists or forms part and the alteration has effect from a date not later than the appropriate day, the rateable value of the dwelling-house on the appropriate day shall be ascertained as if the value shown in the valuation list on the appropriate day had been the value shown in the list as altered. It is thus apparent that, if the original rateable values of these two houses entered in the new valuation lists at April 1 1973 had been under £1,500, the houses would have been within the 1967 Act as amended. The learned judge took the view, in parts of his judgment, that the effect of section 1(6) of the Leasehold Reform Act 1967 was to make April 1 1973 ‘the appropriate day’ at any rate for the purposes of subsection (1)(a) of section 1 (even if not for the purposes of section 4) of the Act in any case where the three conditions (a) (b) and (c) of section 1(6) are satisfied. If that is correct, then section 25(4) of the 1977 Act would directly apply to the substituted ‘appropriate day’ and make the alterations in rateable value on the proposals with which these proceedings are concerned apply retrospectively to April 1 1973 for the purposes of section 1(1)(a) of the 1967 Act. For my part, however, I have some difficulty in accepting that approach because conditions (a) and (b) of section 1(6) appear to show that the section is dealing with cases where there is an appropriate day which falls before April 1 1973. There is then a substitution of a particular date, April 1 1973, but I hesitate to conclude that the way that is done, in the context of section 1(6), makes that date ‘the appropriate day’ as a matter of the terminology of the Act. There is the further difficulty in approaching the problems by the way of a mere substitution in section 1(6) that that approach leaves untouched the analogous problem posed by section 4(1) of the 1967 Act. Section 4(1) requires that for the purposes of deciding whether a tenancy is a tenancy at a low rent, the rateable value of the property in question is to be looked at at a date which may or may not be ‘the appropriate day’; it may be the appropriate day or it may be, if later, the first day of the term of the relevant tenancy. But there is nothing to deem the first day of the term to be ‘the appropriate day’ and thus nothing, if section 4 alone is looked at, to make section 25(4) of the 1977 Act applicable to the rateable value at the first day of the term of the tenancy. The further this legislation is looked into the more manifest it becomes that Parliament must have intended alterations in rateable values which have retrospective effect for rating purposes to April 1 1973 to have like retrospective effect for the purposes of the Leasehold Reform Act 1967 as amended. There is no conceivable reason why alterations should have retrospective effect in respect of rateable values at the appropriate day but not in respect of rateable values at April 1 1973. Moreover, there is an indication in the Housing Act 1974, which introduced section 1(6) into the 1967 Act, that Parliament supposed that such alterations in rateable value would have retrospective effect in respect of rateable values at April 1 1973. Mr Hague for the freeholders therefore admitted that his clients were seeking to take advantage of a casus omissus. But he submitted that there was no construction of the 1967 Act reasonably open to the court which could enable the court to cover these cases for which Parliament had failed to provide. An alternative submission put forward for the leaseholders was that, as Parliament has by section 37(6) of the 1967 Act merely incorporated into the 1967 Act subsections (1), (2) and (4) of section 25 of the 1977 Act and not subsection (3) which defines ‘the appropriate day’, subsection (4) of section 25 must be read in the context of the 1967 Act without regard to any special definition of ‘the appropriate day’ and thus as meaning any relevant day, including where appropriate April 1 1973. I do not accept precisely this way of putting the case, because there was no need to incorporate subsection (3) of section 25 of the 1977 Act by section 37(6) of the 1967 Act; each of the sections of the 1967 Act which are concerned|page:92| with rateable values, sections 1 and 4, contains its own definition of ‘the appropriate day’ and each of those definitions is substantially the same as the definition of ‘the appropriate day’ in subsection (3) of section 25 of the 1977 Act. I do, however, find great assistance in solving this problem in the wording of section 37(6) of the 1967 Act. That provides that section 25(4) of the 1977 Act — as it now is — is to apply for the ascertainment for purposes of the 1967 Act of the rateable value of a house and premises. If the purposes of the 1967 Act require the ascertainment of the rateable value of a house at a date which is not ‘the appropriate day’ within the statutory definition, then section 25(4) must apply mutatis mutandis to the ascertainment of the rateable value on that date, be it the first day of the term of the tenancy for the purposes of section 4(1) or April 1 1973 for the purposes of section 1(1)(a) of the 1967 Act. Accordingly, though I do not agree with certain of the routes, as expressed in his judgment, by which the learned judge reached his conclusions, I agree with his conclusions that the rateable value of each of these houses was on April 1 1973 and for the purposes of the 1967 Act as amended not more than £1,500. I would, therefore, dismiss these appeals. I have mentioned earlier the second reduction of £113 in the rateable value of the MacFarquhars’ property, 55 Campden Hill Road, which it was agreed that they could pray in aid. That reduction arose under Schedule 8 to the Housing Act 1974, which is incorporated into the 1967 Act by subsection (4A) of section 1 of the 1967 Act as amended (which it is unnecessary to set out). Schedule 8 provides for a reduction in the rateable value of premises ‘as ascertained for the purposes of section 1 of the Leasehold Reform Act 1967’ where the tenant or a previous tenant ‘has made or contributed to the cost of an improvement on the premises comprised in the tenancy’, being an ‘improvement made by the execution of works amounting to structural alteration extension or addition’. The reason is, no doubt, that the rateable value might have been increased above a relevant limit because of an improvement paid for by the tenant. The amount of the reduction is to be certified by the valuation officer. That is how the reduction of the £113 came to be made. More importantly, para 3(5) of Schedule 8 provides: 3(5) Where at the time of an application for a certificate . . . a proposal for an alteration in the valuation list relating to the hereditament is pending and the alteration would have effect from a date earlier than the 2nd April, 1973, the Valuation Officer shall not issue the certificate until the proposal is settled. It is implicit in this, as I understand it, that a proposal for an alteration in the valuation list relating to a house which, if allowed, will have effect from April 1 1973 will reduce the rateable value for the purposes of section 1 of the 1967 Act as well as for rating purposes. Otherwise, there would be no point in providing that the valuation officer is to withhold his certificate, which only applies for the purposes of section 1 and not for rating purposes, until the proposal is settled. Agreeing, LLOYD LJ said: I have had the advantage of reading both judgments in draft. I agree that this appeal should be dismissed. Though Dillon LJ and Nicholls LJ reach their conclusion by differing routes, I am happy to adopt the reasons given in either judgment. There will thus be a majority in favour of both views, as well as unanimity in the result. Also agreeing that the appeal should be dismissed, NICHOLLS LJ said: I have had the advantage of reading the judgment of Dillon LJ in draft. I agree with his conclusion regarding section 79 of the General Rate Act 1967. On the construction of the Leasehold Reform Act 1967, which I shall call ‘the Act of 1967’, I reach the same conclusion as Dillon LJ, but by a slightly different route. So I must set out, as shortly as I can, my own views on the construction of the Act of 1967. Section 25 of the Rent Act 1977 contains provision for ascertaining, for the purposes of that Act, the rateable value of a dwelling-house. (That section is the current replacement of a provision, similarly worded in the material respects, in section 43 of the Rent Act 1965. Accordingly, it will be convenient to refer simply to section 25 of the Rent Act 1977 even though, strictly, the Act of 1967 in its original, unamended form, referred to section 43 of the Rent Act 1965.) In section 25(4), dealing with alterations in the valuation list, the expression ‘the appropriate day’ is a defined term, the definition being given in section 25(3). When, by section 37(6) of the Act of 1967, section 25 was applied to the Act of 1967 to ascertain for purposes of the relevant part of that Act the rateable value of property, only subsections (1), (2) and (4) were applied. Pointedly, section 25(3), with its definition of ‘the appropriate day’, was not applied. However, the only two sections in the Act of 1967 where sections 25(1), (2) and (4) have a field of operation are sections 1 and 4. In each of these sections there is a definition of ‘the appropriate day’ which corresponds to the definition in section 25(3) of the Rent Act. This being so, I am in no doubt that, as applied to the Act of 1967, the phrase ‘the appropriate day’, appearing in four places in section 25(4), is a defined term and cannot be read, as was submitted for the leaseholders, as a reference to any day which, under the Act of 1967, would be appropriate for ascertaining rateable value in a particular case. If that is correct, that is, if ‘the appropriate day’ in section 25(4) of the Rent Act 1977 as applied by section 37(6) of the Act of 1967 is a defined term, with the meaning set out in section 1(4) and section 4(1)(a) of the latter Act, for my part I do not find it easy to construe these provisions in such a way that, nevertheless, section 25(4) will apply to any day on which rateable value of the property is in point under Part I of the Act of 1967. In particular, with regard to the phrase ‘the rateable value of the property on the appropriate day or, if later, the first day of the term’ in section 4(1), I recognise that no convincing reason has been suggested why, in practical terms, the rateable value ascertainment provisions in section 25 of the Rent Act should not apply when the relevant date under section 4(1) is the first day of the term as much as when the relevant date is the appropriate day. But given that, for the reason already stated, ‘the appropriate day’ in section 25(4) of the Rent Act as applied in the Act of 1967 by section 37(6) of that Act is a defined term, I do see some difficulty in disregarding that definition when construing section 4(1) where the two contrasting expressions, ‘the appropriate day’ and ‘the first day of the term’, stand cheek by jowl and have done so ever since the section was first enacted. For my part, I prefer to express no view on this, since I consider this appeal must fail on a different point. Section 118 of the Housing Act 1974 introduced three new subsections into section 1 of the Act of 1967: subsections (4A), (5) and (6). Section 1(5) reads as follows: If, in relation to any house and premises, the appropriate day for the purposes of subsection (1)(a) above falls on or after 1st April 1973 that subsection shall have effect in relation to the house and premises, — (a) in a case where the tenancy was created on or before 18th February 1966, as if for the sums of £200 and £400 specified in that subsection there were substituted respectively the sums of £750 and £1,500; and (b) in a case where the tenancy was created after 18th February 1966, as if for those sums of £200 and £400 there were substituted respectively the sums of £500 and £1,000. The terms of section 1(6) are set out in the judgment of Dillon LJ. The evident purpose of the new subsections (5) and (6) was to bring the rateable value limits specified in section 1(1)(a) up to date in the light of the new valuation lists which came into force on April 1 1973 and also, with regard to certain tenancies, to widen the ambit of the section by increasing the rateable value limits by a greater amount than was needed solely to bring the rateable value limits up to date. In short, what was done was this. Except for tenancies created after February 18 1966, the rateable value limits were raised from £200 to £750 (or, in Greater London, from £400 to £1,500). In general, the new valuation lists showed rateable values of the order of two and one half times the previous figures. Thus, in real terms, these increases widened the ambit of section 1. In the case of tenancies created after February 18 1966, which was the date of publication of the Government’s White Paper on Leasehold Reform carried into effect by the Act of 1967, the rateable value limits remained unchanged at the original figures of £200 (or, in Greater London, £400) unless the appropriate day fell on or after April 1 1973, in which case, in line with the rateable value increases represented by the new valuation lists, the limits were raised from £200 to £500 (or £400 to £1,000). Drafting the necessary legislation was comparatively straightforward in the cases where the appropriate day fell on or after the date on which the new valuation lists came into operation, April 1 1973. In those cases, all that was needed was to substitute in section 1(1)(a) the revised rateable valuation figures. That is what was done in the new subsection (5). Accordingly, in those cases, since the material date remained unchanged as ‘the appropriate day’ as already defined, section 25(1), (2) and (4) of the Rent Act continued to apply. In the other class of case, however, where the appropriate day fell before April 1 1973, there had to be a substitution in section 1(1)(a) both of new sums and of a new date (April 1 1973) in place of|page:93| the existing reference to the appropriate day. That was done in the new subsection (6). I find it impossible to suppose that, in enacting this amendment to the Act of 1967, Parliament intended in 1974 that section 25(1), (2) and (4) of the Rent Act, which had applied to the ascertainment of the rateable value of a house and premises on the appropriate day for the purpose of section 1(1)(a) of the Act of 1967, was not, for the like purpose, to apply to the ascertainment of the rateable value of a house and premises on the date deemed by subsection (6) to be substituted in section 1(1)(a) for the appropriate day. Again, looking at the matter from a slightly different angle, under both subsections (5) and (6) rateable value limits of £750 (or £1,500) are specified. In subsection (6) the sums are specified with reference to the date of April 1 1973, and in subsection (5) the sums are specified with reference to the same date of April 1 1973 (or a later date). Thus, under each subsection a similar exercise is called for in ascertaining rateable value for the purposes of the Act of 1967 and, indeed, the exercise might fall to be done in respect of precisely the same date. I find it impossible to suppose that Parliament intended that section 25(1), (2) and (4) of the Rent Act should apply when carrying out the exercise for the purpose of subsection (5) but not if the like exercise were being carried out for the purpose of subsection (6). In my view, a construction of subsection (6) which does not give rise to the anomaly, indeed absurdity, flowing from the freeholders’ construction is reasonably open: when, by virtue of subsection (6), subsection (1)(a) has effect as if another date were substituted for the appointed day and other sums were substituted for those specified in subsection (1)(a), it is implicit that the existing statutory machinery applicable in ascertaining for the purposes of the Act of 1967 the rateable value of a house and premises on the date specified in subsection (1)(a) as originally enacted shall apply on the date substituted by the amendment. I do not think that, against the background I have sketched, this construction of subsection (6) exceeds the proper bounds of statutory interpretation. I add, finally, that I am fortified in this conclusion by noting the third amendment made to section 1 of the Act of 1967 by section 118 of the Housing Act 1974, namely, the introduction of subsection (4A), the effect of which was to incorporate into the Act of 1967 the provisions of Schedule 8 to the Housing Act 1974. Para 3(5) of that schedule assumes that a pending proposal for an alteration in a valuation list may take effect for the purposes of the Act of 1967 retrospectively, that is from April 1 1973 or earlier. The construction of subsection (6) stated above accords with that assumption. The appeals were dismissed with costs. Leave to appeal to the House of Lords was refused.