Council tax – Valuation – Residential property – Appellants converting listed building from three self-contained flats to single dwelling – Listing officer initially reconstituting property into single entry in valuation list for council tax – Listing officer later listing property as two self-contained units – Valuation tribunal upholding decision – Appellants appealing – Whether tribunal erring in law – Appeal dismissed
The appellants owned a property at 24 Lathbury Road, Oxford, which was a large semi-detached town house in north Oxford built in 1908. The property comprised accommodation on the ground, first and second floors. The upper floors had always been accessed from a single centre staircase and a single front door. In 1974, the property was divided into three self-contained flats. The appellants purchased the property in 1985 and began restoring it to its original state as a single house. All internal partitions were removed except a fire door to the second floor, which was required by fire regulations.
In 1993, the property was entered as a single dwelling at valuation band H on the compilation of the Council Tax Valuation List. In October 1994, the property was split into two assessments, the main house at valuation band E and the flat on the second floor at valuation band A. Legal proceedings were commenced by the appellants, but compromised, and the agreement in July 1996 between the appellants and the listing officer reconstituted the property into a single entry in the list at valuation band G.
In April 2019, the billing authority for the area raised a report to the Valuation Office Agency that the top floor of the house was a self-contained unit. On the basis of that information, in July 2019, the listing officer altered the list to disaggregate the property. With effect from that date, the main house was shown at valuation band G and the flat was shown at valuation band B. The appellants challenged the decision to disaggregate but the respondent tribunal confirmed that no alteration to the list would be made. The appellants appealed.
Held: The appeal was dismissed.
(1) Under sections 4 and 6 of the Local Government Finance Act 1992, council tax had to be levied by local authorities on all chargeable dwellings and was payable by residents pursuant to a freehold or leasehold interest or owners of dwellings. A “dwelling” was any property which was a hereditament, meaning for the present purposes a self-contained piece of property that was not included in the non-domestic rating list. Council tax was charged with reference to valuation bands which were calculated on the basis of the value of a dwelling.
Section 3(5) of the 1992 Act provided that the secretary of state might by order provide that in prescribed cases anything which would (apart from the order) be one dwelling was to be treated as two or more dwellings.
Under that power, the secretary of state made the Council Tax (Chargeable Dwellings) Order 1992. Article 2 of the Order defined “self-contained unit” as a building or a part of a building which had been constructed or adapted for use as separate living accommodation. Article 3 provided: “Where a single property contains more than one self-contained unit for the purposes of Part I of the Act, the property shall be treated as comprising as many dwellings as there are such units included in it and each such unit shall be treated as a dwelling.”
(2) There was no avoiding the fact that there was a difference in the authorities. The court’s reconciliation of them was: (i) The tests in articles 2 and 3 of the 1992 Order as to whether a single property contained more than one self-contained unit concerned the physical characteristics of the building as presently constructed and adapted for use; (ii) The physical characteristics of the building might include access and physical facilities, such as those installed for essential living functions – cooking, washing and laundry – although those would not be determinative without considering the building’s other physical characteristics; (iii) Actual use of the building, including communal living, was not the test as to whether the property contained more than one self-contained unit as laid down in the 1992 Order; (iv) In making its factual finding as to whether there was more than one self-contained unit, the tribunal was entitled to have regard to evidence of actual use, but actual use was not a mandatory factor to be considered, and there need be no reference to it; and (v) Actual use would not usually be a factor of significant weight, and at most might reinforce a decision reached by reference to the physical characteristics of the building: Batty (Listing Officer) v Merriman [1995] RA 299, Clement (Listing Officer) v Bryant [2003] EWHC 422 (Admin); [2003] RA 123, R Williams (Listing Officer) v Royal National Institute for the Blind [2003] EWHC 1308, [2003] RA 158, Corkish (Listing Officer) v Wright & Hart [2014] EWHC 237 (Admin), [2014] RVR 233 and Coll (Listing Officer) v Mooney [2016] EWHC 485 (Admin); [2016] PLSCS 86 considered.
(3) The tribunal had concluded that this was not one of those unusual cases where actual use would assist in the task. That being the case, there was no need for it to consider actual use and therefore no need to mention it as a factor in its consideration. In any event, the first appellant had accepted that the “bricks and mortar test”, based on the physical attributes of the accommodation, was the correct test to apply and that was recorded as common ground between the parties as to what was the correct test in determining whether there was one or more self-contained units.
The bricks and mortar test was not limited to the actual bricks and mortar of the property and included all the property’s physical characteristics. It was a matter for the tribunal’s judgment whether the furniture and IT equipment on the first floor were physical characteristics of the property. The tribunal had concluded that they were not.
The appellants accepted that the second floor had features of a self-contained flat. The tribunal also expressly recorded its decision that there were two self-contained units at the subject property; it declared that it was satisfied that it consisted of two self-contained units constructed or adapted for use as separate living accommodation, and accordingly should be shown in the council tax valuation list as two dwellings. As to the privacy aspects raised by the appellants, that went to the communal use of the landing, which the tribunal was entitled to ignore.
Luke Wilcox (instructed by Swinburne Maddison of Durham) appeared for the appellants; Sarah Sackman and Aidan Wills (instructed by HMRC) appeared for the respondent.
Eileen O’Grady, barrister
Click here to read a transcript of Salisbury and another v Bunyan (Listing Officer)
