Council tax – Aggregation – Structural alterations – Claimant owning block of student flats – Claimant seeking review of decision of defendant listing officer concerning treatment for council tax purposes – Whether defendant erring in failing to exercise discretion to “aggregate” bedrooms within each flat so that council tax charged in respect of each bedroom rather than each flat – Claim dismissed
The claimant owned a block of purpose-built student accommodation at Howard Gardens, Cardiff. The property contained 61 flats, each with a number of en-suite bedrooms together with communal kitchen and dining facilities and living space which reflected the number of bedrooms in the flat.
The defendant was the current listing officer appointed pursuant to section 20 of the Local Government Finance Act 1992 to exercise statutory functions in respect of the council tax list in the relevant area.
In April 2022, the claimant received from the local authority council tax bills in respect of the property, which treated each bedroom as a single dwelling for the purposes of council tax. The claimant asked the local authority to treat each flat as a single dwelling, but that request was refused.
Therefore, the claimant wrote to the defendant, asking her to exercise her discretion to aggregate the bedrooms within each flat pursuant to the Council Tax (Chargeable Dwellings) Order 1992. The defendant decided not to exercise her discretion, with the result that council tax was charged in respect of each bedroom rather than each flat.
The claimant challenged that decision contending, amongst other things, that the defendant failed to have regard to a material consideration, namely the extent, if any, to which the parts of the property separately occupied had been structurally altered.
Held: The claim was dismissed.
(1) A self-contained unit was to be identified objectively by reference to the physical characteristics of the building, not by reference to the purposes for which those physical characteristics were achieved. In the present case, each flat in the property was a self-contained unit and each bedroom constituted a unit of separate living accommodation. Accordingly, the defendant’s discretion to aggregate the bedrooms in each flat was engaged.
In the exercise of the discretion, the extent of structural alterations to parts of the property separately occupied was a relevant factor: see article 4(2) of the 1992 Order. Other relevant factors were: (i) the degree of sharing or common facilities (kitchen, bathroom etc); (ii) the degree of adaptations to the property; (iii) whether separate units of accommodation could be accurately identified; and (iv) the degree of transience of the occupiers: James v Williams (Valuation Officer) [1973] RA 305 and R v London South East Valuation Tribunal, ex p Moore [2001] RVR 92 considered.
(2) Practice note 6: premises in multiple occupation (aggregation of dwellings) in the Council Tax Manual published by the Valuation Office Agency, which gave guidance to listing officers in respect of the interpretation and application of article 4 of the 1992 Order, constituted a policy to which the defendant was required to have regard. If she departed from the policy, she was required to give clear reasons for doing so. Practice Note 6 stated that where the listing officer found multiple properties within a single self-contained unit, they had to consider if it was appropriate to aggregate. If the multiple property contained more than one self-contained unit, then article 4 would not apply and the listing officer did not have the discretion to aggregate. There were several factors to consider when deciding whether to aggregate or not. A judgment was needed in every case. The thought process and decision had to be fully recorded as a record of the decision might be needed if there was a legal challenge. A table set out 18 factors that could fall within “all the circumstances of the case”, with an indication against each factor of what might make aggregation more or less likely.
(3) On any fair and sensible reading of the decision and the preceding file note in the present case, the defendant clearly had the physical characteristics of the property and of the flats firmly in mind. The observation that the property was purpose-built directed attention to the relevant point regarding the presence or absence of structural alterations. It was clear that the question of structural alterations was not overlooked, and that the weight to be attributed to any particular factor, even a mandatory factor, was a matter for the decision-maker. The defendant simply considered that the question had no bearing on the matter, because she was dealing with purpose-built student flats; the absence of structural alterations did not weigh in the balance. The defendant was entirely correct in that regard and there was no merit in the complaint that she failed to provide reasons justifying a departure from the policy in Practice Note 6.
The note made clear that “each factor will have a different weight of importance and this will vary case by case”. It was for the decision-maker to have regard to all the circumstances of the case, including the adverse factor that each bedroom had en-suite facilities, and to give them such weight as she thought fit. No departure from policy had been identified and the decision not to aggregate could not be considered irrational.
(4) Each property was to be independently assessed. Where the applicable criteria did not dictate a particular decision, regard might be had to evidence of the treatment of other properties. As between different properties that were relevantly similar, the treatment had to be fair and equal. The requirement to abide by the principle of equality entailed the same principles being applied to each property in the rating list, but not uniformity of outcome, where the evidence demonstrated otherwise. However, caution had to be exercised in the use of other properties, because of the principle that each property fell to be considered independently and because of the many circumstances to be considered in respect of each individual property. In the present case, there was no error of law in the defendant’s approach: Ladies Hosiery and Underwear Ltd v West Middlesex Assessment Committee [1932] 2 KB 679 and Telereal Trillium Ltd v Hewitt [2019] UKSC 23; [2019] EGLR 28 considered.
The decision whether or not to aggregate was a matter for the discretion of the defendant. Where that discretion arose, as here, neither statute nor policy prescribed any particular answer. The defendant was entitled to have regard to the treatment of other properties, and did so.
Cain Ormondroyd (instructed by Ward Hadaway) appeared for the claimant; Horatio Waller (instructed by HM Revenue and Customs) appeared for the defendant.
Eileen O’Grady, barrister
