England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT

		Royal Courts of Justice Strand London WC2A 2LL
		25 November 2010

1. DEPUTY JUDGE MORRIS: This is an appeal by way of case stated brought by the appellant, Tallington Lakes Limited, against a decision of Grantham Magistrates Court made on 15 October 2009.
2. On that date Deputy District Judge Dhaliwal, sitting at Grantham Magistrates Court, and on the application of South Kesteven District Council, made four liability orders against the appellant for non-payment of non-domestic rates under Regulation 12 of the Non-Domestic Rating (Collection and Enforcement) (Local Lists) Regulations 1989, in the total sum of £132,784.12. It appears that those liability orders were made in respect of the non-domestic rates for two financial years, 2008/2009 and 2009/2010.
3. These liability orders relate to a single hereditament known as "Tallington Lakes Leisure Park", which is described as a "caravan park and premises".
4. In this judgment I will refer to the appellant as "TLL" and to the hereditament as "the Tallington Lakes site", or "the Site"; and I will refer to South Kesteven District Council as "the Council".
5. Before the deputy district judge, TLL contested those orders on the basis that it was not liable for the rates as it was not the rateable occupier of the Site.

The Appeal

6. TLL now appeals to this court against those liability orders. Initially, TLL applied to this court for judicial review of the refusal by the magistrates' court to state a case. However, subsequently, and following the grant of permission on 12 May of this year, at the end of May the deputy district judge provided a document explaining, in some detail, her reasons for her decision. By order of His Honour Judge Cooke QC in this court on 12 August 2010 these proceedings were directed to continue as an appeal by way of case stated. Judge Cooke further directed that the deputy district judge's document of 26 May was to stand as the case stated. In this judgment I will refer to that document as the "Stated Case".
7. On this appeal TLL is represented by Mr Edward Hicks of counsel. The Council, and the magistrates have indicated that they do not wish to be represented on the hearing of this appeal.
8. TLL is a limited company. Its sole director is Mr Neil Morgan, and Ms Janet Jones is its company secretary.
9. Tallington Lakes itself is a large and long-established leisure park in Tallington in Linconshire. To put the matter neutrally, TLL is present at the Site and, whilst there is some dispute about the detail, there are a number of other businesses and entities present at the Site. Some of these entities are companies, others are not.
10. TLL is a wholly owned subsidiary of the group holding company, Tallington Holdings Limited ("THL") and Mr Neil Morgan is the sole director of THL. It is not disputed that Mr Morgan is also the sole director of at least one other company in the same group of companies. TLL's case is that it is THL which is the rateable occupier of the Site.

The relevant Law

11. I turn to the relevant law.
12. First, the relevant enactment is section 43 of the Local Government Finance Act 1988. That provides, under the heading "Occupied hereditaments: liability":

"(1) A person (the ratepayer) shall as regards a hereditament be subject to a non-domestic rate in respect of a chargeable financial year if the following conditions are fulfilled in respect of any day in the year—

(a) on the day the ratepayer is in occupation of all or part of the hereditament, and

(b) the hereditament is shown for the day in a local non-domestic rating list in force for the year."

13. I make two initial observations: first, the person to be made liable for rates must be in what is commonly referred to as "rateable occupation". Secondly, the hereditament for which rates liability is imposed is defined by the rating list and liability can only be in respect of that hereditament. In the present case, the Site is listed as a single hereditament.
14. Secondly, as to the concept of rateable occupation, there are four ingredients. These are:

(a) there must be actual occupation;

(b) the occupation must be exclusive for the particular purpose of the possessor;

(c) the possession must be of some value or benefit to the possessor; and

(d) the possession must not be for too transient a period.

15. Those ingredients are based on or drawn from a passage in the judgment of Tucker LJ in the case of John Laing & Son Ltd v Assessment Committee for Kingswood Assessment Area [1949] 1 KB 344 at 350.
16. In the present case, as indeed in the Laing case, the questions are whether TLL was in "actual occupation" and "exclusive occupation" of the Site.
17. Thirdly, there is the notion of paramount occupancy or paramount control. This is explained by Lord Russell in Westminster City Council v Southern Railway Company [1936] AC 511 at 529, where he says as follows:

"Where there is no rival claimant to the occupancy, no difficulty can arise; but in certain cases there may be rival occupancy in some person who, to some extent, may have occupancy rights over the premises. The question in every such case must be one of fact - namely, whose position in relation to occupation is paramount, and whose permission in relation to occupancy is subordinate; but, in my opinion, the question must be considered and answered in regard to the position and rights of the parties in respect of the premises in question, and in regard to the purpose of the occupation of those premises."

18. Lord Russell then goes on to illustrate the point by comparing the position of lodgers in a lodging house with that of a person occupying a flat, and subsequently in the judgment he refers not only to paramountcy of occupation but paramountcy of control.
19. Fourthly, the issue of whose occupation is paramount and whose is subordinate arises where there are rival claimants to occupancy. This does not arise where occupancy is strictly joint. It is clearly established that there may be two or more occupants of one particular hereditament and that each is jointly and severally liable for the rates. An example would be occupancy by a partnership. This is explained by Ryde on Rating in the following terms at paragraph 243 under the heading "Joint Occupiers":

"The occupation of land can be joint, and it is important to distinguish the case of a building in the hands of joint occupiers from that of a building of which the parts are let separately to several persons, each of whom is the occupier of the part let to him, and of that part only. In the case of a firm occupying the whole of the building, the partners are joint occupiers of the whole building, the partners are joint occupiers of the whole and every part of it, and each partner is liable for the rates on the whole. But in such a case as Allchurch v Hendon Union Assessment Committee, where the different parts of a building are let to different tenants, each tenant (if an occupier at all) is an occupier of his own part only and is liable for the rates on that part only. If the whole building is entered in the rating list as one rateable hereditament, no one tenant is liable for the rate on the whole, because he is not the occupier of the whole, nor can he be compelled to pay the rate on the part which he occupies, because there is nothing in the rate, or in the rating list on which it is based, to show what is the value of that part."

20. Turning then briefly to the procedure before this court.
21. This is an appeal by way of case stated under section 111 of the Magistrates' Courts Act 1980. Under that provision, the power of this court is to consider whether the Magistrates' Court was wrong in law or exceeded its jurisdiction. However, it is well-established that it is an error of law for the magistrates to reach a perverse conclusion on the evidence.
22. As it is put in Blackstone's Criminal Practice 2011 at paragraph D28.14:

"The remedy [of case stated] operates only in relation to an error of law or a decision taken in excess of jurisdiction. A decision as to a question of fact will ordinarily not give rise to an appeal by way of case stated but may do so if the finding of fact is alleged to be such that no reasonable bench could have properly reached that factual conclusion on this evidence."

And it cites the case of Bracegirdle v Oxley [1947] KB 349.

23. So I remind myself that my task is to decide whether the deputy district judge made an error of law, or reached a conclusion of fact which no reasonable district judge could have reached on the evidence or reached a conclusion which is perverse.
24. It is no part of my task to enter upon analysis of the findings of fact in any other way, for example by balancing the weight of different evidence received.

Procedural and Factual Background

25. Turning back to the present case, further details of the procedural and factual background are as follows. According to Mr Morgan's evidence placed before the deputy district judge (to which I will return in a moment) previously, in June 2006, the Council had invoiced THL for non-domestic rates for the Site. Shortly thereafter THL had applied to the Council for hardship relief. Subsequently, and in and for the same year, the Council then invoiced TLL and another company for the same amounts as those for which they had previously invoiced THL.
26. As regards the present proceedings, the Council applied to Grantham Magistrates' Court for the grant of four liability orders against TLL.
27. Complaints dated 12 February were issued against TLL for one of the years, and issued on 11 June 2009 for the other year. TLL replied by letter in March 2009 stating its opposition to the application for liability orders. The two sets of complaints were then listed for hearing at the same contested hearing.

The hearing and evidence before the Deputy District Judge

28. The contested complaints were heard by the deputy district judge on 15 October. The Council was represented by Mr Adrian Johnson, a council officer; and TLL was represented by Mr Morgan himself.
29. TLL placed before the deputy district judge, and relied upon, two witness statements, each dated 7 October 2009 - one from Mr Morgan and one from Mrs Jones. Each was verified by a statement of truth and signed.
30. Mr Morgan in his witness statement stated at the outset that he was a director of the company and duly authorised to make the statement. Then under the heading "Tallington Lakes Limited is not liable for domestic rates and is not the rateable occupier" his witness statement continued as follows:

"4. Tallington Lakes Limited is only one of several companies and businesses at the Tallington site. These companies & businesses include: (a) Tallington Lakes Leisure Parks Limited (b) Tallington Lakes Proshop, (c) Tallington Holdings Limited (d) Tallington Holdings Waterski & Wakeboard School Limited, (e) Tallington Ski Centre Limited, (f) Wentworth Action Sports, (g) Tallington Dry Ski Slope Limited, (h) Tallington Jet Ski & Sailing Centre, (i) Ace Watersports, (j) Tallington Lakes Krazy Karts, and (k) Tallington Lakes Lakeside Restaurant & Bar."

Then 5:

"The correct entity/company/business responsible for any non-domestic rates liability at the site is Tallington Holdings Limited. This is the overall financial entity through which everything flows at the Tallington site and it is the overall occupying entity."

Then critically paragraph 6 stated:

"Different companies, franchisees, partnerships and licensees all operate upon and occupy upon separate areas across the site, collecting income from their discrete areas of physical and financial operation. Tallington Lakes Limited is just ONE of these companies, franchisees, partnerships and licensees operating across the site." [my emphasis]

His witness statement then went on to deal with a number of other matters, and then concluded under this part, as follows:

"16. Tallington Holdings Limited is liable for the non-domestic rates at the site and Tallington Holdings Limited is the rateable occupier at the site."

31. In her statement, Ms Jones gave evidence to almost precisely the same effect as the passages that I have just quoted.
32. Neither Mr Morgan nor Ms Jones were cross-examined on those statements.
33. The Council placed no evidence before the deputy district judge, either by way of witness statement or by way of oral evidence. Its case was confined to the presentation of oral argument.
34. As we shall see in a moment, the deputy district judge did ask Mr Morgan certain questions about the various business entities referred to in his witness statement and which I have just enumerated.

The Stated Case

35. Turning now to the Stated Case. After an introduction about the case, the Stated Case continues at paragraph 4:

"The liability orders were contested by the Applicant on three grounds: i) namely that the Applicant was not liable for non-domestic rates and is not the rateable occupier; ii) the summons were incorrect and that the amounts due and stated on the summons were incorrect; and iii) that the summons were invalid in that , inter alia, the summons were issued by Mr Johnson and not the Magistrates' Court and were thus invalid.

5. It was my view that I would make a preliminary decision on who was the rateable occupier as this went to the heart of the contested matter and then go on to then consider whether the amounts specified on the summons were correct or indeed whether the summon were invalid.

"6. Both parties were made aware of my approach to the case and representations were invited on this one aspect initially, namely, who was the rateable occupier.

"7. Representations made by the interested party.

"The Interested Party [being the Council] made representations to the Court that they took the view that the Applicant was the rateable occupier ... In particular, reference was made to JDE Plant Hire v Barking & Dagenham LBC (2000) which concluded that justices could properly find a company to be in actual occupation firstly on the basis that it was using the premises for the purpose of its business and secondly because the individual licensees all used a common access. It was authority for the proposition that once actual occupation had been established, it was inevitable that the company's occupation should be found to be exclusive and beneficial and not transient. The Interested Party asserted that in this case, it was proper to find that the Applicant was in actual occupation as it was likewise using its premises for business, the principal activity was the same and there was common access, thus the Applicant was in actual occupation ..."

36. Paragraph 8 is headed "REPRESENTATIONS MADE BY THE APPLICANT":

"The Applicant made submissions to the court and stated that the case law vindicated his position and supported him. It was submitted that Tallington Holdings Limited was on site and owned the company. It was asserted that it was this company that was in control and had paramount control ...

"9. Based on the case law that had been submitted and agreed by both parties, in order to determine which company had paramount control, clarification was required on the structure of the companies involved. The question was put to the Applicant as to how many directors were in each of the companies from 'a to k' that was cited on page 2 of the statement of the Applicant."

37. The deputy district judge then sets out those enumerated companies which I have already referred to as drawing from paragraph 4 of Mr Morgan's statement (see paragraph 30 above).
38. The deputy district judge then continues at paragraph 10 of the Stated Case:

"After some prevarication by the Applicant, the questions was put again and the Applicant answered that he was the sole director in each of the companies named 'a to k' and that there was also a company secretary. The Applicant did not elaborate any further on this point."

39. I should point out that Mr Morgan himself disputes this description of the exchange that took place at the hearing. But that is not a matter which I can enter upon in this appeal.
40. We then get to, effectively, the essential part of the deputy district judge's reasoning which is to be found at paragraphs 11 and 12 of the Stated Case and is as follows.

"11. I retired to decide on the preliminary issue as to who was the rateable occupier. I took into account the witness statements of Mr Neil Morgan and Ms Janet Jones, the case law that was put before me and the representations made by both parties. I found that the Applicant could be said to be in actual occupation based on JDE Plant Hire Limited v Barking & Dagenham LBC (2000). Furthermore, I considered that since the Applicant's representative, namely, Mr Morgan, on his own admissions stated that he was the only and sole director of each of the companies listed in 'A to k', that Mr Morgan, did in fact have control of the premises and because of the shared occupation between all companies, the Applicant or Mr Morgan (who was one and the same) was at all times in paramount control. Relying on Kent County Council v Ashford Borough Council & Others 1999, since the Applicant or Mr Morgan (who was one and the same) retained control over the use of the premises, then the Applicant was thus the ratepayer.

"12. A preliminary ruling was given. I announced that there was no definition of a rateable occupier but that guidance had been given in the case law that I was being referred to and in considering who had paramount control over the premises, I considered the structure of each company. Evidence had been given before me by the Applicant to state that he was the one and only director of each of the companies cited as 'a to k' on his statement. I stated that it mattered not which company had been sent notice to pay the non-domestic rates as Mr Morgan was the only and sole director and that he had paramount control. Since he was the director of each company, Tallington Lakes Limited being one of those companies was the rateable occupier and had correctly been served with the rate demands and was therefore liable to pay non-domestic rates."

41. The Stated Case goes on to deal with the other two issues, and at paragraph 18 the deputy district judge concludes:

"I made my decision based on the case law on the evidence that had been presented before me, in particular, I attached significant weight to the admission made by the Applicant that he was the one and only director."

The Question

42. Unlike the usual practice, the Stated Case does not go on to identify any question or questions which fall for determination on this appeal by way of case stated. This is because the document was prepared effectively as a justification for the refusal to state a case in the context of a judicial review application.
43. Nevertheless, given that the matter is now proceeding by way of case stated, I considered it helpful to formulate appropriate questions to assist in my determination of the appeal; and, with the assistance, and agreement, of Mr Hicks, the questions which fall for determination can be stated as follows:

1. Whether, having regard to the evidence and relevant principles of law, the deputy district judge could, as a reasonable district judge, find that TLL was in, "actual occupation" of the entire Tallington Lakes site (whether by virtue of her findings in relation to the extent of TLL's business activities at the Tallington Lakes site and/or by Mr Morgan being a common single director of companies operating at the Tallington Lakes site and/or otherwise), or whether her finding was perverse and unlawful and one that no reasonable district judge could reach, having regard to the evidence and the relevant principles of law.

2. Whether having regard to the evidence and the relevant principles of law, the deputy district judge could, as a reasonable district judge, find that (1) all the named companies or entities were in shared occupation, and (2) TLL was in "paramount control", of the entire Tallington Lakes site (whether by virtue of Mr Morgan being a common single director of companies operating at the Tallington Lakes site and/or otherwise), or whether her finding was perverse and unlawful and one that no reasonable district judge could reach having regard to the evidence and the relevant principles of law."

The appellant's submissions

44. Mr Hicks for TLL submits as follows: first, at the heart of the district judge's analysis was the finding, repeatedly found in the Stated Case, that Mr Morgan and TLL were "one and the same", and further, implicitly, that because he was sole director of the other "companies", TLL and the other companies and entities must be regarded as one and the same.
45. Second, that there was no evidence at all to support the deputy district judge's finding that TLL was in actual occupation of the Site as a whole. The only evidence of any entity being in occupation on the entire site was that it was THL which was on site and in control.
46. Thirdly, that there was no evidence at all to support the deputy district judge's finding that TLL was in paramount control of the entire site -- and that the only basis upon which this finding had been made, namely that Mr Morgan and TLL were one and the same -- was wrong as a matter of law.

Analysis

47. I start my analysis by seeking to summarise the deputy district judge's findings and reasoning. The deputy district judge made the following express findings in the Stated Case.

1. TTL "could be said to be in actual occupation" (paragraph 11).

2. Mr Morgan in fact had control of the premises (paragraph 11).

3. All the companies had shared occupation of the premises (paragraph 12).

4. Mr Morgan and TLL were "one and the same" (paragraph 11).

5. Mr Morgan had paramount control of the premises (paragraph 12).

6. Because of 4, TLL had paramount control of the premises (paragraph 11).

(1) TLL "in actual occuptation"

48. With these findings in mind I can turn to consider the two questions, and I start by considering the finding that TLL was in actual occupation.
49. The Site is a single hereditament. Thus, given the legal requirement of occupation of the whole hereditament, then, in the present case, in order for TLL to be liable for the rates, the deputy district judge had to find that TLL was in occupation of the whole site. If, by contrast, the deputy district judge had found that TLL was in occupation of only part, then it could not be the rateable occupier of the hereditament at all. Thus, the deputy district judge's finding as to TLL's occupation is a finding as to occupation of the entire site.
50. What, if any, evidence was before the deputy district judge to support such a finding? She did not refer to any such evidence.
51. Rather, at paragraph 11 of the Stated Case the deputy district judge referred to JDE Plant Hire as the basis for her finding, and that, in turn, appears to refer back to the submission of the Council recorded at paragraph 7 of the Stated Case. [The full title of the JDE case is R v London Borough of Barking and Dagenham (QBD) Tomlinson~J unreported 28 July 2008]
52. But the Council's argument recorded at paragraph 7 of the stated case was simply that - mere submission, and was not based on evidence.
53. It is hard to see how JDE itself supports the conclusion of fact in this case.
54. If and insofar as it can be said that, in support of her finding in paragraph 11, the deputy district judge was adopting the Council's statement in paragraph 7 of the Stated Case that TLL was "using its premises for business", then this was mere assertion by the Council and there was no evidence to support a finding that the word "premises", was to be construed as referring to the entire site.
55. In any event, the facts of the JDE case were different and the reasoning there, in my judgment, cannot apply here. In that case the owner was found to be in rateable occupation of the whole of the hereditament where it had granted licences to over 14 units within the hereditament to third parties who physically occupied those units. Mr Justice Tomlinson (as he then was) held (at paragraph 53 of his judgment) that JDE was liable for two reasons: first, that its use of the premises was found to be use of the whole premises, including the parts occupied by the third parties; and secondly, JDE was found to be in control of the parts occupied by the third parties.
56. As to whether in this case TLL could be said to control parts of the Site which it did not occupy or use, this could only arise on the basis of the deputy district judge's finding that TLL and Mr Morgan are one and the same. I will address this reasoning a little later in this judgment (at paragraph 63 and following below).
57. Turning back to the evidence that was before the deputy district judge, in contrast to the Council's case made by way of argument the evidence of Mr Morgan and Ms Jones in their witness statements is to the effect that TLL occupied only part of the Site. Their evidence was, first, that TLL was "at the Tallington site"; secondly, that the various companies and entities "operate upon and occupy upon separate areas across the Site, collecting income from their discrete areas of physical and financial operation"; and thirdly, that TLL was one of those companies (being a reference back to the companies in the previous paragraph, paragraph 4) operating across the Site. In my judgment, the effect of that evidence alone was that TLL occupied some part of the Site, but not the entire Site.
58. Now whilst that evidence might be said to raise a number of follow-up questions about the separate physical areas within the Site, and how the various companies and entities operated and occupied in practice, neither Mr Morgan nor Ms Jones were questioned or challenged upon their evidence either by the Council's representative or by the deputy district judge herself.
59. So their evidence stands as the only relevant evidence before the deputy district judge who herself records that she took this evidence into account. There is no suggestion that she did not accept it or of any reason why she might not accept it.
60. In those circumstances, I conclude that there was no evidence at all before the deputy district judge to support a finding that TLL (rather than THL) was in actual occupation of the entirety of the Site.
61. Indeed on one analysis it might be thought that that would be sufficient to dispose of the entire appeal, since absent a finding of actual occupation on the part of TLL of the hereditament comprised by the Site, the first ingredient of "rateable occupation" cannot be established, and the deputy district judge was bound to conclude that TLL could not be liable for the rates.

(2) Mr Morgan and TLL were "one and the same"

62. Nevertheless, the matter may not rest there, because of the deputy district judge's analysis based on her finding that Mr Morgan and TLL were one and the same.
63. This aspect arises both as part of the first of the two questions identified, and is at the heart of the second question. It formed the essential part of the deputy district judge's reasoning and it may be that the deputy district judge's decision was based on an analysis which is other than one of direct physical actual occupation by TLL.
64. I start by making two observations.
65. First, in my judgment, the concept of "paramount control" does not sit very easily with the facts of the present case and may have been misleading. This is not really a case of rival or competing occupiers at all, as in the cases cited above. It is closer to a case of joint occupation by the various companies and entities operating at the Site.
66. Secondly, Mr Hicks accepts that if, on the facts of this case, TLL and other entities together shared occupation of the entire Site, then TLL would still be liable, even if the other entities were liable too. In that event, there would be no room for debate about which of the entities' control of the Site was paramount.
67. In paragraph 11 of the Stated Case, the deputy district judge does find that there was "shared occupation between all companies" and in my judgment this is the finding at the heart of the deputy district judge's reasoning.
68. Mr Hicks submits that, if and insofar as this is to be read as a finding that all the companies jointly occupied the entire Site, then it is a finding that could not be made on the evidence or as a matter of law.
69. I deal with these this turn.
70. First, there was no evidence at all before the deputy district judge that each company or entity was in occupation of the entire Site which might support a finding of some sort of joint occupation. In fact, as already pointed out, the evidence of Mr Morgan and Ms Jones was to the contrary effect (see paragraph 6 of Mr Morgan's statement). So there was no evidential basis for a finding of shared occupation of the whole, and indeed none was really suggested by the deputy district judge.
71. Secondly, as regard the law, the deputy district judge's reasoning for her finding of shared occupation, and it seems ultimately, of paramount control on the part of TLL (and presumably all the other entities), is this: Even if TLL does not directly actually occupy the entire site, nevertheless it should be regarded as doing so -- and as having paramount control of the whole entire site -- for the following four reasons, or steps of logic:
72. First, Mr Morgan has control over the entire Site. Secondly, Mr Morgan is the sole director of all the entities which together occupy the entire Site. Thirdly, Mr Morgan and TLL (and presumably all the other companies) are "one and the same". Fourthly, therefore, because he is the sole director, the control by Mr Morgan over the entire Site is to be treated as control by each and every company of which he is the sole director and is to be regarded as the control of the entire Site by each such company.
73. In this way, so the reasoning goes, TLL has control of the entire Site, as do all the other companies, and it is on this basis that there is shared occupation of the entire Site by all the companies.
74. Mr Hicks contends that this analysis is based upon the deputy district judge's finding that TLL and Mr Morgan are "one and the same", and he says that that finding discloses a fundamental error of law. The deputy district judge failed to appreciate that a company is a legal entity separate and distinct from its individual members, and equally that each company in a group of companies is also a separate legal entity. The circumstances in which it is possible to go behind these principles and to pierce the corporate veil are limited. The deputy district judge made no finding that the veil could be pierced here, and indeed heard no evidence which could have justified her so doing. Rather, Mr Hicks argued, the deputy district judge simply ignored the essential principles of corporate identity (and he referred me in his skeleton argument to the familiar cases of Salomon v Salomon and Adams v Cape Industries).
75. Before addressing this argument, there are two preliminary points to note. First, the deputy district judge proceeds on the basis that each of the entities listed by Mr Morgan in his witness statement (at paragraph 4) are companies. This appears to be an error, when it is clear both from their names and from the witness statement itself, that this is not the case: some of the entities identified at paragraph 4 appear to be mere trading names or partnerships. Secondly, Mr Morgan disputes that he is the sole director of all the named companies or entities. However, in my view, on the basis of what is contained in the Stated Case, the finding that he was the sole director of all the named entities cannot be questioned in this appeal.
76. In any event, disregarding these two preliminary points, in my judgment the deputy district judge's reasoning here was wrong in law.
77. To the extent that the deputy district judge concluded that the actions of Mr Morgan as the sole director could be regarded in law as the action of the company of which he was sole director, then that is not of itself objectionable. It is commonplace for the conduct of a director to be regarded as the conduct of the company where it can be said that that director is the controlling mind and will of the company. Thus, company A could be said to occupy one part of the Site by reason of the conduct of Mr Morgan as director of company A in relation to that part of the Site; and the same could apply to company B in relation to Mr Morgan's conduct as director of company B in relation to another part of the Site.
78. However, what the deputy district judge appears to have done in order to reach her conclusion is to have "cross-attributed" acts of occupation as between the various companies. In other words, an act of control by Mr Morgan when acting as a director of another company in respect of one part of the Site is to be attributed not only to that company, but also to TLL and indeed to every other company of which Mr Morgan was sole director. In this way, all Mr Morgan's acts of control over different parts of the Site would be attributed to each company of which he is sole director, and in that way every company would have control over the whole site. That is the logic of the cross-attribution to which I refer.
79. In my judgment, this does breach the principle of separate corporate identity, particularly as between different companies within the same group of companies. The attribution to a company of the conduct of its director in that capacity is permissible. The attribution to a company of the conduct of a director in his capacity as director of another company cannot be done without breaching the principle of separate corporate identities. If the deputy district judge's analysis were correct, any other company of which Mr Morgan was also sole director but which had no connection at all with the Site would be regarded as in control of the Site. Such an outcome need only to be stated to demonstrate the fallacy of the deputy district judge's reasoning. Rather, as Mr Hicks put it, there was no basis to conclude that where Mr Morgan was exercising control over parts of the Site of which TLL was not in actual occupation, he was doing so in his capacity as director of TLL.
80. Accordingly, there was no basis in law or on the evidence for the deputy district judge's finding of shared occupation by all the companies and entities.
81. Equally, insofar as relevant at all, there was no basis in law or in fact for the deputy district judge's finding that TLL (and by implication all the entities) were in paramount control of the entire site.
82. Whilst I have expressed doubt as to whether the issue of paramount control arises in this case at all, it might be said to arise in the following way:
83. If the deputy district judge's finding as to occupation by TLL is to be read as confined to part of the Site (as per Mr Morgan's witness statement), and if, contrary to the passage in Ryde, it might be said that, as an occupier of part of the hereditament, in principle TLL could be liable for the rates on the whole site, then the deputy district judge's reasoning might be construed as being as follows: since Mr Morgan himself has paramount control of the entire Site, then TLL (being one and the same) also has paramount control over the whole site, even though it physically occupies only part.
84. However, such an analysis is flawed for the very same reason as the analysis relating to shared occupation, as it depends on the same erroneous "cross-attribution" between different companies of Mr Morgan's conduct.

Answers to the Questions

85. Accordingly, the answers to the questions which I myself defined earlier in paragraph 44 of this judgment are as follows:

1. The finding of the deputy district judge (at paragraph 11 of the Stated Case) that TLL was in actual occupation of the entire Tallington Lakes site was one which no reasonable district judge could have reached, having regard to the evidence and the relevant principles of law and was thus perverse and unlawful.

2. The findings of the deputy district judge (at paragraph 11 of the Stated Case) that all the named companies or entities were in shared occupation, and that TLL was in paramount control of the entire Tallington Lakes site, were findings which no reason district judge would have reached, having regard to the evidence and the relevant principles of law and was thus perverse and unlawful.

86. In light of these conclusions, the deputy district judge was wrong to find that TLL is the rateable occupier of the Site and her decision imposing liability orders should be set aside.
87. This appeal is accordingly allowed.
88. I will now hear submissions from Mr Hicks on costs and on any other matters arising.
89. MR HICKS: Thank you, my Lord.
90. There are two matters which I think arise, firstly in relation to the name of the case. I understand outside it is listed as "The Queen on the application of Tallington Lakes v South Kesteven District Magistrates Court".
91. DEPUTY JUDGE MORRIS: Yes, I noticed that.
92. MR HICKS: I think it should be Grantham Magistrates Court. I don't think it's ever been changed.
93. DEPUTY JUDGE MORRIS: If it had started as case stated --
94. MR HICKS: It would probably have been TLL v South Kesteven District Magistrates' Court, if it had started that way.
95. DEPUTY JUDGE MORRIS: I agree. I have it as that. And just for the record, for the judgment, make sure that the title is "The Queen on the application of Tallington Lakes Limited v Grantham Magistrates Court".
96. MR HICKS: Thank you.
97. That does lead me on to the question of costs. I have a copy of a costs schedule, if I can hand that up. (Handed). First of all, in relation to principle of costs. TLL has been successful in this appeal. It also has been essentially successful in the original judicial review bits of the case.
98. I appreciate the other parties aren't here today but they've both had notice of this case, they've both been given the opportunity to attend. In my submission TLL should be entitled to its costs. Perhaps it might be appropriate that they would have to be apportioned between the two and I can explain it perhaps in this way. There are three elements of the costs. The first part of the costs is the costs in front of the magistrates on the first occasion.
99. DEPUTY JUDGE MORRIS: Did I not read somewhere you might not be entitled to those costs?
100. MR HICKS: I think there is discretion to give those costs.
101. DEPUTY JUDGE MORRIS: Okay.
102. MR HICKS: That's element one.
103. Element 2 is the costs of the initial judicial review application up until the point the district judge put in the document that it turned out to be a statement of case. Because that was essentially a complaint about the court, rather than anything that South Kesteven District have done.
104. DEPUTY JUDGE MORRIS: In those circumstances one could order costs against the court, can one?
105. MR HICKS: The position is --
106. DEPUTY JUDGE MORRIS: Anyway, give me the third element.
107. MR HICKS: The third element is the point at which this became essentially an appeal by way of case stated. It is effectively a dispute between TLL and the District Council, who could have conceded the point if they' d wanted to but they didn't. So those are the three aspects to the case.
108. It is my submission that perhaps Kesteven District Council should be liable for the first and the third because it was essentially the opposition. And in relation to the second, that is a matter that concerns the Magistrates' Court. I understand magistrates' courts in generals are immune from liability for costs but instead it is the Lord Chancellor's Department which is liable. It is under the Justices and Justices Clerks Costs Regulations 2001. I can start with the Court's Act 2003, section 34, which says:
109. "A court may not order a Justice of the Peace to pay costs in any proceedings in respect of what he does or omits to do in the purported execution of his duty as a Justice of the Peace."
110. So that will appear to cover --
111. DEPUTY JUDGE MORRIS: Can I say this -- because I am conscious of time -- is there any circumstance in which it might be fair, if I make an order, to give the opportunity for the other parties to put in observations? I know they have not appeared. Alternatively, should I leave the question of costs to written submission by you and the others, should they wish to do so?
112. MR HICKS: Yes. There is a reason why that would be very sensible because I understand that it may be, strictly speaking, that South Kesteven hadn't actually become a party because I don't think they were ever formally joined. They were an interested party with the opportunity to join. If that's right, then I don't think an order for costs can be made against them, unless they can make representations.
113. DEPUTY JUDGE MORRIS: If they have not been joined as a party and they do nothing --
114. MR HICKS: If they do nothing then I think certainly they would have to have opportunity.
115. DEPUTY JUDGE MORRIS: But let's say they do nothing, if they are not a party can I make --
116. MR HICKS: Yes you can --
117. DEPUTY JUDGE MORRIS: I can make an order --
118. MR HICKS: You can. Under section 51 of the Senior Courts Act there is discretion to make a costs order against a non-party if they are not a party. In this case we say in truth they were the party that was the relevant party in relation to the proceedings in the Magistrates' Court and the case stated element of the case, and they were given the opportunity to oppose it or make comments. In the circumstances we say that they, as the true defendant, or I suppose respondent in the case stated, should be liable. But I can appreciate that they may well want to make representations about that. So that may be sensible. In relation to the --
119. DEPUTY JUDGE MORRIS: It may be helpful for you to set it out in writing to me as well.
120. MR HICKS: I think it's not straightforward.
121. DEPUTY JUDGE MORRIS: I think I'm going to do that, if that is all right by you.
122. MR HICKS: Yes. I can only say further to that that there's obviously the statement of costs. This does raise issues because it's a litigant in person. So I can address that as well in --
123. DEPUTY JUDGE MORRIS: I think that would be a good idea. How do we deal with that? I think the best thing is for me to make a direction that you put in within a certain time written submissions on costs, dealing with all the matters you were about to deal with now, and the fact it's a litigant in person, and my powers, and at the same time you serve that on the magistrates and the Council.
124. I think I would like you to address in your note particularly the circumstance in which this court would order costs against the magistrates if it is a discretion, and that means obviously effectively it's a costs order in a judicial review case for failing to state a case.
125. Then I think some time to be allowed for those parties to respond. Then I would deal with it on paper and I might hand down a short supplemental judgment. It may be easier again, rather than do a judgment, to do it at a brief hearing, or hand down a judgment orally. But I think that is the way to do it.
126. Now, in terms of time, how long would you want to --
127. MR HICKS: I think I could do it within 14 days and then 14 days for the other party to respond. If I can do it quicker --
128. DEPUTY JUDGE MORRIS: That takes you to Christmas.
129. MR HICKS: Yes.
130. DEPUTY JUDGE MORRIS: Can you do it in seven days?
131. MR HICKS: I'll juggle.
132. DEPUTY JUDGE MORRIS: That will take us to 2 December; is that right?
133. MR HICKS: Yes.
134. DEPUTY JUDGE MORRIS: I think it may be worth at the same time you undertaking to notify the other two parties of this order to be prepared -- you notify them today, so that they are prepared. I'm just thinking, if I give them two weeks after that, it would then run to 16 December, which is getting pretty tight for me, I think. What day of the week is the 16th?
135. MR HICKS: It's a Thursday.
136. DEPUTY JUDGE MORRIS: I'm minded to give them to the Monday before, which is --
137. MR HICKS: The 13th.
138. DEPUTY JUDGE MORRIS: Which is 11 days for them. So that's what I'm going to order. So the order is seven days for you to put written submissions in or written submissions by 2 December, written submissions from other parties by 18th December; is that right? I do not have a diary in front of me.
139. MR HICKS: By the 13th and you --
140. DEPUTY JUDGE MORRIS: And you to undertake to notify the two parties today of the fact that this is going to happen, so that they can consider whether they are going to even -- and they will therefore no doubt want to look at the judgment.
141. MR HICKS: They will have it. I have enough of a note. It will be fine.
142. I think that does raise one other issue which is I know there is this hearing in the Chancery Division but I think because we have the judgment, I don't think we need the reasons for it. The judgment setting aside the liability order --
143. DEPUTY JUDGE MORRIS: To set it aside --
144. MR HICKS: -- does the trick. So I think we will be fine. But if I can get a copy of that --
145. DEPUTY JUDGE MORRIS: Of the?
146. MR HICKS: Of the order.
147. DEPUTY JUDGE MORRIS: I don't know who will draw up the order but no doubt if you nag the court and they want me, I am here this week and next and therefore I can initial anything as soon as possible. If you want to hurry that up I'm available.
148. I suppose there is liberty to apply to the others in relation to that timetable, if need be. It may very well be they will do nothing, but ...
149. MR HICKS: Do we then need a listing date as well, or ... if you want to get this in before Christmas.
150. DEPUTY JUDGE MORRIS: I think we'll leave it. It may be I won't be able to make my decision before Christmas but I want to have the option to do so.
151. MR HICKS: Very well.
152. DEPUTY JUDGE MORRIS: Very good. Thank you very much.