England and Wales High Court (Administrative Court) Decisions

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
APPEAL FROM THE VALUATION TRIBUNAL FOR ENGLAND

		Royal Courts of Justice Strand, London, WC2A 2LL
		20 November 2018

Mr Justice Murray :

1. This is an appeal on a point of law by the Listing Officer for Cornwall ("the LO") of a decision dated 7 December 2017 ("the VTE Decision") of the Valuation Tribunal for England ("the VTE") allowing the appeal of Mr Michael Dannhauser against a decision of the LO dated 14 June 2017 ("the LO Decision"), rejecting Mr Dannhauser's proposal that the council tax band applicable to his freehold property, Kerris Vean Farmhouse, Kerris Vean, Paul, Penzance TR19 6NT ("the Property") be reduced from band D to band C. I have adopted Mr Dannhauser's preferred spelling of the name and location of the Property, namely, "Kerris Vean" rather than "Kerrisvean", used by the LO and the VTE.
2. The question for this appeal, in general terms, is whether the VTE applied the correct test to determine Mr Dannhauser's appeal.
3. In this judgment I will use the term "the LO" to refer to the appellant and "listing officer" to refer generally to listing officers in England.

Background

4. Mr Dannhauser purchased the Property on 30 September 2016.
5. The background to this dispute is set out succinctly at paragraphs 2 to 6 of the VTE Decision:

"2. This appeal has been brought in respect of the following: A proposal was served on the Listing Officer (LO) dated 20 April 2017 by Mr Dannhauser. He disputed the increased assessment from band C to band D. The [LO] determined that the proposal was not well founded and issued a decision notice to that effect on 14 June 2017. Mr Dannhauser subsequently made an appeal to this tribunal against the decision notice.

3. Under Regulation 6 of the Council Tax (Situation and Valuation of Dwellings) Regulations 1992 (SI 1992 No. 550), each valuation band represents a value that the dwelling might reasonably have been expected to realise had it been sold in the open market by a willing vendor on 1 April 1991. The bands are set out in section 5(2) of the Local Government Finance Act 1992, with the relevant bands in relation to this appeal being:

Band C – values greater than £52,000 but no more than £68,000

Band D – values greater than £68,000 but no more than £88,000

4. In this appeal, the relevant date for consideration of the physical state of the dwelling and its locality is the date the property had originally been entered into the Valuation List, namely 1 April 1993.

5. The subject property entered the council tax valuation as a band C dwelling with effect from the introduction of the council tax on 1 April 1993. After a relevant transaction and review for potential alterations and improvements the banding was increased by the [LO] to band E with effect from 30 October 2016. However after receiving a proposal from the appellant the LO subsequently discovered that no alterations or improvements had taken place at the property since its introduction into council tax. At that … point the LO agreed that the banding should not be increased to band E. However the LO then considered that an error / mistake had occurred when the appeal property was originally placed into the list and decided that the banding should now be increased to band D with effect from 30 October 2016.

6. The appeal property is a terraced house built pre 1900. It measured 242 m² and comprised three living rooms, kitchen, five bedrooms and two bath/shower rooms."

6. The "relevant transaction" referred to in paragraph 5 of the VTE Decision was Mr Dannhauser's purchase of the Property. The LO Decision did not set out any specific reasons for the LO's determination that band D should apply to the Property rather than band C.
7. Mr Dannhauser appealed the LO Decision, and the appeal was heard by the VTE on 21 November 2017. The LO stated in her rebuttal document prepared for the appeal hearing that when she concluded that the increase to band E was in error, she also determined that the original allocation of the Property as band C was an "historic error and that … band D … fairly reflects the 1991 value of the property".

The statutory framework

8. This case turns on the proper interpretation of a particular phrase used in section 24(4(b)(i) of the Local Government Finance Act 1992 ("the 1992 Act") and in a regulation made under section 24 of the 1992 Act, namely, regulation 3(1)(b)(i) of the Council Tax (Alteration of Lists and Appeals) (England) Regulations 2009 ("the 2009 Regulations"). Before considering the specific legislation at issue in this case, it is necessary to set out the relevant statutory background.
9. Part I, encompassing sections 1 to 69, of the 1992 Act sets out the statutory basis for the levying and collection of council tax in England. Council tax is payable in respect of a "dwelling". A dwelling is a property that:

i) would fall within the definition of "hereditament" in section 115(1) of the General Rate Act 1967 if that Act were still in force; and

ii) broadly, is not subject to non-domestic rates.

In short, council tax is payable in respect of domestic real property, rather than real property used for "non-domestic" or business purposes. Council tax is payable in respect of a dwelling, unless a specific exemption applies.

10. The basic statutory framework is helpfully summarised by Rix LJ in Chilton-Merryweather v Hunt [2008] EWCA Civ 1025, [2009] PTSR 568 (CA) at [8] to [9]:

"8. … With the failure of the community charge, the 1992 Act, which introduced the council tax for the purpose of taxation of domestic property, returned to the basic scheme of valuing individual properties by a common yardstick, in this case their capital value. Council tax in England is paid according to which of eight valuation bands, fixed by the statute, an individual dwelling falls into. Thus, in essence, council tax is payable by the resident of a chargeable dwelling on an annual basis and the amount of tax is based on the valuation band against which the dwelling is entered on the valuation list. That value and thus the appropriate valuation band are determined by listing officers in accordance with valuation principles prescribed by the 1992 Act and its Regulations.

9. For the purpose of council tax, the valuation had to be done by reference to two dates, 1 April 1991 and 1 April 1993 (the '1991 date' and the '1993 date' respectively). The yardstick for valuation was fixed according to the open market price at which the dwelling might reasonably have been expected to have sold at the 1991 date; but the size, layout and character of the dwelling and the physical state of its locality, on the basis of which the 1991 date valuation had to be fixed, was to be taken as at the date of its actual valuation, which (broadly speaking) was in the run-up to and conventionally as at the 1993 date. In terms of the statutory language, the 1991 date valuation had to be made on the assumption that dwelling and locality were as they were at the date of actual valuation. Certain other assumptions also applied, such as that the dwelling was in a reasonable state of repair. The valuation list was then compiled on 1 April 1993 and came into effect on that day. The general effect of these provisions is that inspection and valuation are all done, within a tight time regime, in relation to the physical configuration of the dwelling and the physical state of the locality, but by reference to certain conventional yardsticks, such as a common assumption that the dwelling is in a reasonable state of repair, and, importantly, a common 'bible' of market values as of a single day, 1 April 1991."

11. Under section 1 of the 1992 Act, levying and collecting council tax in respect of a dwelling is the responsibility of the relevant local authority for the area in which the dwelling is situated. That local authority is the "billing authority" under the 1992 Act. The billing authority in this case is Cornwall Council.
12. There are rules for determining who is liable to pay council tax in respect of a dwelling. It is not in dispute in this case that Mr Dannhauser is liable for council tax in respect of the Property.
13. Under section 20 of the 1992 Act, a listing officer is appointed for each billing authority. The LO is the appointed listing officer for Cornwall Council. Under section 22(1) of the 1992 Act a listing officer for a billing authority is required to "compile, and then maintain, a list for the authority (to be called its valuation list)". The valuation list is the list of each dwelling that is subject to council tax in the relevant area and records, in respect of each dwelling, which council tax band applies.
14. Pursuant to section 21(1) of the 1992 Act, the Commissioners of Inland Revenue (as they then were) were to carry out the initial valuations of dwellings that were used by listing officers across England to compile their valuation lists on 1 April 1993 by reference to the value of each dwelling on 1 April 1991, as described by Rix LJ in the passage from the Chilton-Merryweather case quoted above.
15. Under section 21(2) of the 1992 Act, the Secretary of State was given the power to prescribe the principles and assumptions in accordance with which the valuations under section 21(2) were to be carried out. The Secretary of State exercised this power by making the Council Tax (Situation and Valuation of Dwellings) Regulations 1992 ("the 1992 Regulations"). Regulation 6(1) of the 1992 Regulations provides:

"(1) Subject to regulation 7, for the purposes of valuations under section 21 (valuations for purposes of lists) of the [1992 Act], the value of any dwelling shall be taken to be the amount which, on the assumptions mentioned in paragraphs (2) and (3) below, the dwelling might reasonably have been expected to realise if it had been sold in the open market by a willing vendor on 1st April 1991."

16. Regulation 7 is irrelevant for present purposes. Paragraphs (2) and (3) of regulation 6 set out the various assumptions applicable, including those highlighted by Rix LJ in the Chilton-Merryweather case at [9]. In particular, regulation 6(2)(d) provides that the dwelling will be valued as if, on 1st April 1991, its size, layout and character, and the physical state of its locality, were the same as on the "relevant date", which under regulation 5A means 1st April 1993 in the case of a valuation carried out for the purposes of an alteration to correct an inaccuracy in the valuation list on the day it was compiled.
17. In other words, in this case, the correct valuation of the Property for purposes of determining the appropriate council tax band is the amount that the Property might reasonably have been expected to realise if it had been sold in the open market by a willing vendor on 1st April 1991 on various assumptions, including vacant possession, a reasonable state of repair and so on, and in particular on the assumption that its size, layout and character, and the physical state of its locality, were the same as they were on 1st April 1993 ("the Regulation 6(1) Value").
18. Under section 22 of the 1992 Act, as I have noted, each listing officer is required to "compile, and then maintain," her valuation list. Under section 22(9) this duty lasts "for so long as is necessary for the purposes of" the council tax scheme for England set out in Part I of the 1992 Act. In other words, it is an on-going duty, as is implied by the use of the word "maintain".
19. In the context of non-domestic rating legislation, Sullivan J in R (Corus UK Limited) v Valuation Office Agency [2001] EWHC 1108 (Admin) at [46] (see also at [47] and [52]) held that a statutory duty of a valuation officer (the role corresponding to a listing officer in the non-domestic rating context) to compile and maintain a non-domestic rating list "must be a duty to compile and then maintain an accurate list". That, clearly, must also apply to the duty of a listing officer in respect of a council tax valuation list under section 22 of the 1992 Act.
20. Section 23 of the 1992 Act prescribes that each valuation list shall show, for each day it is in force, each dwelling in the billing authority's area and the council tax band applicable to that dwelling, as well as other information that may be prescribed by secondary legislation.
21. Section 24 of the 1992 Act provides that the Secretary of State may make regulations governing the alteration of a valuation list and setting out conditions for and limitations on the power of a listing officer to make an alteration. Section 24(2) provides:

"(2) The regulations may include provision that where a listing officer intends to alter the list with a view to its being accurately maintained, he shall not alter it unless prescribed conditions (as to notice or otherwise) are fulfilled."

22. Section 24(4) of the 1992 Act provides that the regulations may include provision that no alteration shall be made of a valuation band shown in a valuation list as applicable to a dwelling unless certain conditions are fulfilled, including the following condition under section 24(4)(b):

"(b) the listing officer is satisfied that –

(i) a different valuation band should have been determined by him as applicable to the dwelling; …" (emphasis added)

23. The 2009 Regulations implement this provision in regulation 3(1)(b)(i) as follows:

"(1) No alteration shall be made of a valuation band shown in a list as applicable to any dwelling unless –

…

(b) the LO is satisfied that –

(i) a different valuation band should have been determined by the LO as applicable to the dwelling; …" (emphasis added)

"LO" in the 2009 Regulations means "listing officer".

24. Regulation 3(1)(b)(i) tracks the permissive language of the 1992 Act, but makes it prescriptive. The result, as contemplated by the 1992 Act, is that a listing officer does not have a broad power to alter a valuation list, subject to exceptions. Instead, the listing officer's power is circumscribed. A listing officer may not alter a valuation list, unless a specified condition is satisfied. Mr Paul Reynolds, counsel for the Respondent, referred to these conditions as "statutory gateways". Section 3(1)(b)(i) is an example of one such condition or gateway.
25. Another condition or gateway empowering a listing officer to alter a valuation list is set out in regulation 3(1)(a)(i):

"(1) No alteration shall be made of a valuation band shown in a list as applicable to any dwelling unless –

(a) since the valuation band was first shown in the list as applicable to the dwelling –

(i) … there has been a material increase in the value of the dwelling and a relevant transaction has been subsequently carried out in relation to the whole or any part of it; …"

26. "Relevant transaction" is not defined in the 2009 Regulations, but it is defined in section 24(10) of the 1992 Act to mean:

"a transfer on sale of the fee simple, a grant of a lease for a term of seven years or more or a transfer on sale of such a lease."

27. Regulation 3(1)(a)(i) was the provision relied upon by the LO to make her original alteration of the band applicable to the Property from band C to band E following the purchase by Mr Dannhauser of the Property, based on her mistaken belief that there had been material relevant alterations and improvements at the Property. Regulation 3(1)(b)(i) was the provision relied on by the LO to alter the band applicable to the Property to band D, rather than reverting to band C, as the Property had originally been classified.
28. Regulation 4(1) of the 2009 Regulations provides that where a billing authority or an "interested person", such as a person liable to council tax in respect of a dwelling, is of the opinion that a valuation list is inaccurate because, among other things, "the LO has determined as applicable to the dwelling a valuation band other than that which should have been determined as so applicable" (emphasis added), then that billing authority or interested person may make a "proposal" for the alteration of the list. Various other rules relating to proposals are then set out in regulations 4 to 9 of the 2009 Regulations. These were the rules under which Mr Dannhauser made his proposal, which resulted in the LO Decision against which he appealed to the VTE.

The VTE Decision

29. Mr Dannhauser's appeal was heard on 21 November 2017 by a panel comprised of two lay members of the Tribunal, one of whom was a solicitor, with the clerk of the Tribunal providing legal advice to the panel.
30. In paragraph 8 of the VTE Decision, the VTE characterised the issue arising on the appeal as:

"whether an error had occurred in April 1993 when the appeal property was originally placed in the council tax list as a band C property."

31. The VTE went on to set out its view of the correct legal test to determine this issue at paragraphs 10 to 12 of the VTE Decision as follows:

"10. The clerk explained that, in an appeal of this nature, the correct legal test to apply is, firstly, does the LO have power to increase the assessment and then, secondly, was there evidence from the time the appeal property was initially placed in the council tax list at band C [to show that this was] a mistake. As the LO had determined the earlier entry in the list to be an error, the clerk advised the panel that the only evidence admissible was the evidence that was available to the LO at the time, when the alleged error occurred, which in this case was 1 April 1993.

11. The panel also had regard to the High Court decision of Zeynab Adam v Listing Officer [2014] EWHC 1110 (Admin), together with decisions of the former President of the Tribunal, Professor G Zellick QC, in Ward v Coll (LO) and Martin v Coll (LO). The judgment in Zeynab Adam gave authority to the LO to correct an entry in the Valuation List that resulted from a mistake.

12. Having regard to the wording of [regulation 3(1)(b)(i) of the 2009 Regulations], together with the authorities quoted, the panel accepted the clerk's advice that, when dealing with appeals of this nature, regard must only be had to evidence that was available to the LO at the time when the alleged error occurred."

32. I have added to paragraph 10 in square brackets words that appear to be missing. Both parties read the sentence this way.
33. In paragraph 13, the VTE went on to conclude:

"13. The panel found that the LO representative had not been able to provide evidence to justify her claim that the initial entry in the list resulted from a mistake. No evidence was produced to show what evidence / information was used when the appeal property was initially placed into the council tax list." (emphasis added)

34. I note that there is some ambiguity in the way that the VTE recorded its reasoning as to the second limb of the test, namely, the evidence admissible to establish whether the original council tax band assigned to the property on its initial entry into the valuation list was erroneous. Paragraphs 10 and 12 appear to suggest that it must be evidence that was "available to" the LO, whether or not the LO actually used the evidence, from which it could be concluded that the original council tax band allocation was in error. The second sentence of paragraph 13 appears to reflect a tighter test, namely, that only evidence actually used by the LO to make the initial allocation can be used to establish that the original allocation was in error.
35. The VTE found that the representative of the LO was not able to provide any evidence that was used by the LO when the Property entered the valuation list on 1 April 1993. She was not permitted to present evidence of sales that had occurred after 1 April 1993, nor was she allowed to refer to the "tone of the list".
36. Ryde on Rating and the Council Tax at para 483 defines the term "tone of the list", in the context of non-domestic rating, as follows:

"Since all rateable values in a rating list must be assessed at a common valuation date, the 'tone of the list' for a particular category of hereditament is the general level of value for that type of hereditament at that date. Assessments under appeal will carry less weight than assessments which are settled in the absence of an appeal or following determination of an appeal. The weight to be attached to comparable assessments increases over time."

37. The tone of the list is therefore something that is established over time. In Jafton Properties Limited v Prisk (Valuation Officer) [1997] RA 137, 166-167, in a case dealing with non-domestic rating, the Lands Tribunal said:

""[I]t is settled law that assessments of comparable hereditaments are admissible as evidence of value … and there are three stages leading to the establishment of tone of the list. At first, when the list is put on deposit, the assessments carry little weight: they are opinions of value by the valuation officer, as yet unchallenged and untested by negotiation and determination. As time passes more and more assessments are agreed or determined by valuation tribunals or this tribunal. Finally, a stage is reached when enough assessments have been settled or are unchallenged to establish a patter of established values, a 'tone of the list'."

It is clear that this concept also applies to council tax valuation lists, for the same reasons, as was confirmed in relation to council tax in the case of Domblides v Listing Officer [2008] EWHC 3271 (Admin), [34]-[36].

38. Nonetheless, the VTE would not permit evidence as to the tone of the valuation list in considering whether the LO had power to alter the valuation list in relation to the Property under regulation 3(1)(b)(i) of the 2009 Regulations as the valuation list came into effect on 1 April 1993, and no tone would therefore have been established at that point.
39. Because the LO was unable to present the evidence or other information used by the LO to make her original assessment that the Property should be allocated to band C, the panel concluded that it could not determine whether that initial allocation was mistaken.
40. The VTE's conclusion is recorded in paragraph 18 of the VTE Decision:

"18. Therefore, the panel made a finding of fact, that the LO had not made a mistake in April 1993, as such, the panel allowed the appeal."

41. Respectfully, it does not seem right that this can properly be described as a "finding of fact". No factual evidence acceptable to the VTE was considered during the appeal. At best the VTE confirmed a presumption that, in respect of the Property, the list was correctly compiled on 1 April 1993.
42. Although the VTE does not express its conclusion in this way, I take it that real basis of the VTE's conclusion was that, in the absence of admissible evidence, the LO had failed to establish to the satisfaction of the VTE that:

i) the condition in regulation 3(1)(b)(i) was satisfied; and

ii) therefore, the LO had the necessary power under the regulation to alter the list in the way that she did.

43. Accordingly, in the final paragraph of the VTE Decision, the VTE set out its order that the LO alter the valuation list within two weeks of the date of the order to show that the council tax band applicable to the Property is band C with effect from 30 October 2016. In other words, Mr Dannhauser's appeal to the VTE was allowed.

The Issue

44. This issue for this appeal by the LO of the VTE Decision is whether the VTE Tribunal applied the correct legal test to determine Mr Dannhauser's appeal.

Analysis

45. In the VTE Decision, the VTE set out a two-part test, which I restate slightly (but without intending to change the substance) as follows:

i) In relation to a dwelling, does the LO have the power to alter the council tax band applicable to the dwelling under regulation 3(1)(b)(i)?

ii) Is there evidence that was available to or, in the alternative, that was actually used by the LO at the time the dwelling was initially placed on the valuation list on the basis of which the LO could lawfully conclude that the original council tax band allocation was made in error?

46. The panel relied principally, it seems, on the decision of His Honour Judge Jeremy Richardson QC, sitting as a Judge of the High Court, in Adam v Listing Officer [2014] EWHC 1110 (Admin). It also "had regard" to two decisions of the former President of the VTE, Professor Zellick QC, Ward v Coll (LO) and Martin v Coll (LO).
47. The background facts of the Adam case are somewhat different from the present one, but the case is relevant as it concerned the proper interpretation of regulation 3(1)(b)(i) of the 2009 Regulations. In brief, the property in that case entered the valuation list on 1 April 1993 at band C. The taxpayer became liable for council tax in respect of the property on 2 November 2007. She made a proposal to the listing officer to lower the council tax band to band B. Following an inspection of the property, the listing officer agreed in May 2008 to lower the council tax band to band B. It was not known on what basis the listing officer agreed to lower the council tax band. In July 2012 the listing officer wrote to the taxpayer noting that the council tax band would be increased to band C with effect from 29 July 2012, relying on regulation 3(1)(b)(i). The taxpayer's appeal was dismissed by the VTE. The taxpayer appealed to the High Court on a point of law.
48. HHJ Richardson QC summarised the law in relation to regulation 3(1)(b)(i) as follows at [18] to [21] of his judgment:

"18. The real issue in this case concerns para 3(1)(b)(i) of the Council Tax (Alteration of Lists and Appeals) England Regulations 2009. That paragraph provides:

'Restrictions on alteration of valuation bands.

3. (1) No alteration shall be made of a valuation band shown in a list as applicable to any dwelling unless: (b) the listing officer is satisfied that: … ([i]) a different valuation should have been determined by the listing officer as applicable to the dwelling.'

19. I have deliberately emphasised the phrase 'should have been determined'. It is drafted in the past tense.

20. The import of the paragraph is, in my judgment, clear and simple: if a listing officer, in the exercise of his or her judgment, is of the view that a different band should have been determined by a listing officer, he or she has an obligation to alter it. In other words, if it appears that a mistake was made or for some other reason the band should have been different, then he or she has a duty to change it. It is to be noted the listing officer may only do that prospectively and not retrospectively.

21. Paragraph 3(1)(b)(i) plainly permits an error or mistake to be corrected prospectively not retrospectively if the listing officer determines that the band should have been different. When that decision falls to be made by the listing officer, or on an appeal to the tribunal, the analysis must be undertaken in accordance with the law as expressed in the statute and regulations. Reference to the concept of issue estoppel is irrelevant. Vague, or even more precise, notions of fairness are equally inappropriate. The listing officer and the tribunal are required to make decisions in a fair manner based upon the statute and regulations. Plain it is in this case, the listing officer was of the view a mistake was made in the past to downgrade the banding for the appellant's home. That is implicit in the language employed by Mrs Arbuckle in her submissions to the tribunal, and, indeed, the language employed by the tribunal. Certainly evidence was presented to reveal this property to be in band C and not band B. That was for the factual judgment of the listing officer and the tribunal. Consequently, the listing officer and the tribunal were satisfied that a different valuation band should have been determined, and that permits an alteration to be made under this paragraph of the regulations."

49. As can be seen from the passages quoted, the judge dismissed arguments of the taxpayer based on fairness (to the extent that goes beyond the relevant statutory requirements) and on the concept of issue estoppel. The judge emphasised at [24] of his decision that the listing officer must make his determination under regulation 3(1)(b)(i) on evidence. He also said at [24]:

"The simple fact is that the regulatory regime permits past errors to be corrected for the future. … Historical errors may be corrected whatever the reason for the error and providing the listing officer is satisfied that the band should have been different."

50. Respectfully, I agree with the judge's approach to the application of regulation 3(1)(b)(i). Unfortunately, however, he was not required to consider what evidence is admissible to support the listing officer's determination under regulation 3(1)(b)(i), which is the key issue in this case.
51. The issue in Ward v Coll (Listing Officer) [2016] RVR 37, a decision dated 11 August 2015 of Professor Graham Zellick QC sitting as President of the VTE, was whether a listing officer could rely on the power in regulation 3(1)(b)(i) to make an alteration to increase the council tax band applicable to a dwelling notwithstanding an earlier agreement between the listing officer and the taxpayer under which the council tax band had been reduced. Counsel for the listing officer in that case submitted that the question had been decided by the Adam case and that this was binding on the VTE. Professor Zellick had expressed a contrary view in Martin v Coll (Listing Officer) [2015] RVR 270 at [23]-[31], and he maintained he was not bound by Adam in relation to this question. Ultimately, however, he came to the conclusion that the listing officer did have the relevant power. At [28] he made the following observation:

"(2) The burden on the listing officer to show that a mistake was made at the time should be scrutinised by the tribunal with considerable intensity before endorsing the alteration."

52. With respect, Professor Zellick QC did not give any authority for this proposition, but it appears to flow from his view, expressed elsewhere in the judgment, that a taxpayer is bound to feel unfairly treated if she was not made aware at the time of her agreement with the listing officer that, notwithstanding the agreement, the listing officer could subsequently increase the council tax band in reliance on regulation 3(1)(b)(i).
53. Professor Zellick's proposition as to the necessity for scrutiny "with considerable intensity" by the VTE of a listing officer's decision "that a mistake was made at the time" is, in my view, incorrect if it is intended to imply that the listing officer must somehow do more than comply with the terms of regulation 3(1)(b)(i). It should not be taken as justification for a focus on the actual decision-making of the listing officer as at the time of a property's entry into the valuation list. The reason for the original error is irrelevant. The listing officer, looking at the question on a subsequent date, simply needs to determine whether there was an error on the earlier date. The Ward case sheds no light on the key question of what evidence a listing officer may take into account in making her determination under regulation 3(1)(b)(i).
54. Returning for a moment to the first limb of the test applied by the VTE, namely, whether the LO has the power to alter the council tax band applicable to the dwelling under regulation 3(1)(b)(i), it is clear that she does have the power, provided that she is satisfied that a different valuation band should have been determined by the LO as applicable to the dwelling. The first point to note is that the listing officer must be satisfied. It is a matter for her judgment. She must make that judgment on a rational basis, of course, and, as emphasised in the case of Adam, on the basis of evidence.
55. So, how does the LO determine what valuation band should have been determined by the LO as applicable to the dwelling? It is clear from regulation 6(1) of the 1992 Regulations that the value that the LO should have used to determine which valuation band applied to the Property as at 1 April 1993 was its Regulation 6(1) Value, as I have defined it at [17] above.
56. Where the LO is seeking on a subsequent date to determine whether the Property has been allocated to the correct valuation band, she is required to determine the Regulation 6(1) Value. Having done that, she simply has to look at the relevant valuation bands set out in the statutory scheme to determine which valuation band the Regulation 6(1) Value falls within. If, once that has been determined, it is clear that the Property should have been allocated to a different council tax band on the basis of that value, then the LO has the power to alter the valuation list in respect of the Property in reliance on regulation 3(1)(b)(i).
57. So, here we get to the nub of the matter. What evidence is the LO, on any day subsequent to 1 April 1993, permitted to use in order to determine the Regulation 6(1) Value and therefore the correct valuation band? Three possible answers have arisen in this case. The LO on that subsequent day:

i) may use only the evidence that was actually used by the LO to determine the Regulation 6(1) Value at the time of the Property's entry into the valuation list on 1 April 1993;

ii) may use only evidence that was reasonably available to the LO to determine the Regulation 6(1) Value at the time of the Property's entry into the valuation list on 1 April 1993, whether or not the LO actually used some or all of that evidence, but no evidence arising after 1 April 1993; or

iii) may use any evidence, whether arising before or after 1 April 1993, including evidence of the "tone of the list", that can reasonably be said to establish what the Regulation 6(1) Value was at the time of the Property's entry into the valuation list on 1 April 1993.

58. As I have already noted, the VTE in this case appears initially to have articulated the test in (ii) above, but then in paragraph 13 of the VTE Decision to have applied the narrower test in (i). It was suggested in submissions that there are conflicting VTE decisions on this point, but that the narrower test in (i) has been often, although not consistently, used by the VTE. In my view, there is neither a statutory basis nor any basis in principle for a requirement that a listing officer, seeking to exercise her power under regulation 3(1)(b)(i), must limit herself to the evidence actually considered by the LO at the time of the relevant dwelling's entry into the valuation list. There are both practical and policy objections to such a restrictive test. I will not attempt to list them all, but will highlight a couple.
59. First, the test in (i) at [57] creates an almost impossible hurdle for a listing officer, as the passage of time will make it extremely difficult for the listing officer to determine what evidence was actually used as at 1 April 1993, particularly given that primary responsibility for the valuations as at that date lay formally with the Commissioners of Inland Revenue and the listing officer's formal responsibility was to take valuations provided and compile the valuation list. A massive exercise was undertaken to establish the new council tax scheme as at 1 April 1993. To the extent that a listing officer was, on a delegated basis, involved in the establishment of the valuation but failed for some reason to look at evidence that was reasonably available, that is a matter of competence that should not tie the hands of a listing officer looking on a subsequent date to comply with her duty to maintain an accurate valuation list. There is no sensible policy reason why the evidence should be limited in this way. Accordingly, the first answer to this question, that set out in (i) at [57] above, can be rejected.
60. I note that Mr Reynolds in his skeleton argument on behalf of Mr Dannhauser appeared to agree that (i) is too restrictive. He adopted (ii) as the correct test. Mr Reynolds submitted that (iii) must be rejected as excluded by the use of the words "should have been determined". This is not merely "in the past tense", as noted at [19] of the Adam case. It is normative. The LO can only have been required to determine the relevant valuation band on the basis of the evidence available to her as at 1 April 1993. It cannot be said that she "should have determined" a valuation band as of that date by reference to evidence that she did not have, and could not possibly have had, available to her, namely, evidence arising subsequent to that date, including as to the "tone of the list".
61. Ms Hui Ling McCarthy QC, counsel for the LO, submitted that the words "should have been determined" must be read purposively in light of the LO's general duty to compile and maintain an accurate valuation list. That general duty means that the power conferred by regulation 3(1)(b)(i) is, in law, also a duty. There is no discretion. If a listing officer determines on a day that the valuation band attributed to a dwelling was erroneous by reference to the Regulation 6(1) Value that should have been determined by the listing officer as of the date of the dwelling's entry into the valuation list, then it is her duty to exercise her power to alter the valuation list. I agree with her submissions on these points.
62. Ms McCarthy further submitted that it makes no difference what the reason was for the original error by the LO. There should therefore be no need for the LO considering the accuracy of the valuation list on a subsequent occasion to investigate the error by reference to the actual evidence used by the LO at the time of the Property's initial entry into the list. I agree. There is no statutory basis for such a requirement, nor does it make sense as a matter of policy.
63. Ms McCarthy cited various authorities to me where the courts have held that it is permissible to have regard to evidence arising after a particular date in order to determine a value as at that date, for example, in relation to valuation for tax purposes (Dyer v HMRC [2016] UKUT 381 (TCC) at [37]), valuation for purposes of determination compensation for a compulsory purchase of land (Bishopsgate Parking (No 2) Ltd v Welsh Ministers [2012] UKUT 22 (LC) at [58] to [63]) and in non-domestic rating cases (for example, the Northern Irish case of Northern Ireland Transport Holding Company v Commissioner of Valuation for Northern Ireland [1997] RA 14 at pages 26-30).
64. It is not necessary for me to discuss these cases in detail. The thrust of Ms McCarthy's submissions by reference to these cases is perhaps encapsulated by a judicial comment in The Bwllfa and Merthyr Dare Steam Collieries (1891) Limited v The Pontypridd Waterworks Company [1903] AC 426 (HL), at 431, a case concerning compensation for loss of a right to extract coal. In the Bwllfa case, the House of Lords considered what evidence it was appropriate for an arbitrator to consider in assessing compensation due to the appellants. The respondents had argued that the arbitrator should have regard only to facts or circumstances that would have been known to the arbitrator had he made his determination on the date when the appellants received notice that they had notice cutting off their right to extract the coal. The House of Lords rejected this approach. Lord Macnaghten said at p 431:

"If the question goes to arbitration, the arbitrator's duty is to determine the amount of compensation payable. In order to enable him to come to a just and true conclusion it is his duty, I think, to avail himself of all information at hand at the time of making his award which may be laid before him. Why should he listen to conjecture on a matter which has become an accomplished fact? Why should he guess when he can calculate? With the light before him, why should he shut his eyes and grope in the dark?"

65. Mr Reynolds met these submissions with the straightforward submission that none of the cases referred to by Ms McCarthy involved the specific statutory wording at issue in this case, which required the VTE to have regard to what "should have been determined" by the LO in relation to the Property as at 1 April 1993.
66. Mr Reynolds submitted that the normative interpretation provides greater certainty for a council tax payer than the test proposed by the LO. It is a strict test and makes it difficult for a listing officer to alter a valuation list. The use of the normative language was therefore deliberate in section 24(4)(b) of the 1992 Act and in regulation 3(1)(b)(i) of the 2009 Regulations. He also noted that a listing officer has power under regulation 3(1)(a) to make alterations to the list reflecting events subsequent to 1 April 1993, so her powers are not unduly limited. The use of normative language in regulation 3(1)(b)(i) is intended to ensure that the right balance is struck between the competing policy objectives of "accuracy, equality [as between comparable dwellings] and certainty" in relation to the compilation and maintenance of valuation lists.
67. While I agree that the words "should have been determined" in section 24(4)(b) of the 1992 Act, which were carried over by the Secretary of State into regulation 3(1)(b)(i) of the 2009 Regulations, are capable of bearing the meaning ascribed to them by Mr Reynolds, I do not accept that that is what Parliament intended. My view is that those words must be construed in context and by reference to the primary duty of a listing officer in relation to her valuation list, namely, the duty to compile and maintain an accurate list.
68. Viewed in that light, it seems to me that Parliament was concerned principally with the accuracy of the valuation list as at 1 April 1993 and not with the quality of the listing officer's performance in her compilation of the valuation list as of that date. In exercising her power (and duty) to alter the valuation list, the listing officer must therefore be entitled to take into account any evidence capable of showing what the accurate valuation of a dwelling was, its true Regulation 6(1) Value, regardless of when that evidence arises. This may therefore include evidence of relevant sales post-dating 1 April 1991 and evidence of the tone of the list, which, as we have seen, necessarily arises after 1 April 1993.
69. This is not unfair to the council tax payer, because of the restriction to a valuation date of 1 April 1991 and the other conditions that apply to the valuation. Evidence of a subsequent sale carries less weight the longer the gap in time between 1 April 1991 and the date of the sale. Evidence of the tone of the list improves over time, as already discussed. Its use is amply justified in light of the policy in favour of accuracy.
70. None of this means that a listing officer has a broad power to alter a valuation list based on regulation 3(1)(b)(i) on grounds of fairness, because it is "the right and proper thing to do" or on any basis other than that set out in regulation 3(1)(b)(i). That was made clear in the case of Adam.
71. Finally, I note that regulation 4(1)(c) of the 2009 Regulations gives a council tax payer (as an "interested person") the right to make a proposal to correct a valuation list on the basis that the listing officer has determined as applicable to the dwelling a valuation band other than that which should have been determined as so applicable. In other words, the listing officer's duty to maintain an accurate list can require the listing officer to lower a valuation band as well as increase it, if a lower valuation band "should have been determined" to be applicable.

The proper test to be applied

72. For the reasons I have given, I conclude that the VTE applied the wrong legal test to determined Mr Dannhauser's to the VTE, and therefore the LO's appeal to this court is allowed.
73. Under regulation 3(1)(b)(i) of the 2009 Regulations, a listing officer has the power to alter a valuation list on any day on which the listing officer determines, based on evidence available to the listing officer on that day, that the Regulation 6(1) Value, as I have defined it at [17] above, of a dwelling indicates that the dwelling should be allocated to a different valuation band. Evidence available to the listing officer on that day is not limited to evidence that would have been available to the listing officer on or prior to the date on which the dwelling entered the valuation list, whether that was on 1 April 1993 or some subsequent date. The listing officer is entitled to take into account any evidence that is capable of establishing the Regulation 6(1) Value, including evidence of sales post-dating the date the dwelling entered the valuation list and evidence of the tone of the list.
74. Finally, I note that in the VTE Mr Dannhauser challenged the LO's determination that the valuation band applicable to the Property should be band D rather than band C. He therefore bore the burden of proof. He needed to demonstrate that the LO could not be satisfied by reference to the evidence available to her at the time of the LO Decision, applying the guidance at [73], that the Property should be allocated to band D rather than band C.
75. As I am not in a position to determine Mr Dannhauser's appeal to the VTE on the basis of the information before me on this appeal, the appropriate course is for me to remit this matter to the VTE for it to determine the appeal in accordance with the guidance given in this judgment.

Conclusion

76. The LO's appeal is allowed. This matter will be remitted to the VTE to determine the appeal in accordance with the guidance given in this judgment.
77. I would like to thank counsel for each of the parties for the clear and compelling way each presented their submissions. I would, in particular, like to thank Mr Reynolds for agreeing to represent Mr Dannhauser as pro bono counsel so that the issues raised by this appeal could be properly and thoroughly considered.