England and Wales Lands Tribunal

O'Brien v (Valuation Officer) [2004] UKLANDS RA_18_2005 (04 November 2005)

RA/18/2005

LANDS TRIBUNAL ACT 1949

RATING – advertising rights – alteration of list – proposal – whether valid – correct assessment – appeal dismissed – Non-Domestic Rating (Alteration of Lists and Appeals) Regulations 1993, reg 13A (13)

IN THE MATTER of an APPEAL from the LONDON

(NORTH WEST) VALUATION TRIBUNAL

BETWEEN BARRY O'BRIEN Appellant

and

BARRY TIMOTHY LEAHY Respondent

(Valuation Officer)

Re: Advertising rights at

110 Chase Side

Southgate

London N14

Before: P H Clarke FRICS

Sitting at Procession House, London EC4

on 21 October 2005

The following cases are referred to in this decision:

Sole v Henning (VO) [1959] 3 All ER 398

Mainstream Ventures Limited v Woolway (VO) [2000] RA 395

Esau Brothers v Rodd (VO) [1992] RA 257

The appellant in person

Mr John Harding, with permission of the Tribunal, for the respondent valuation officer

DECISION

1. This is an appeal under the simplified procedure regarding the assessment in the 2000 rating list of advertising rights in Southgate.
2. Mr Barry O'Brien, the appellant, appeared in person and gave evidence. Mr John Harding, a valuer in the Valuation Office Agency, appeared with permission for the respondent valuation officer, Mr Barry Timothy Leahy MRICS, who gave evidence.

Facts

3. The valuation officer has prepared a statement of facts (not wholly agreed). From this statement and the documents I find the following facts.
4. The hereditament which is the subject of this appeal comprises the right to display advertisements at ground level on the flank wall of The Wishing Well public house at 110 Chase Side in Southgate, London N14. These advertising rights related to a single wood framed hoarding of standard 48-sheet size attached to the wall.
5. The appeal hereditament was not entered in the 2000 rating list when it was compiled. On 18 December 2001 the valuation officer altered the list by inserting the appeal hereditament as advertising right and premises, rateable value £2,790, with an effective date of 1 April 2001. A copy of the notice of alteration was served by post on Mr O'Brien on 24 December 2001.
6. On 30 September 2002 the local authority advised the valuation officer that the advertisement hoarding had ceased to exist. Following an inspection he altered the list by notice on 22 October 2002 by deleting the appeal hereditament, with an effective date of 1 April 2002. A copy of the notice of alteration was served on Mr O'Brien by post on 23 October 2002. The appeal hereditament was therefore entered in the 2000 rating list between 1 April 2001 and 1 April 2002.
7. On 8 September 2004 the valuation officer received a proposal dated 7 September 2004 from Mr O'Brien in respect of the appeal hereditament, seeking a reduction in the assessment to rateable value £1,540 with effect from 1 April 2001 on the grounds that the rateable value in the list was inaccurate. The occupier was stated to be Poster Sites (Southern) and the proposal was signed by Mr O'Brien as occupier.
8. The valuation officer did not regard the proposal as well-founded and the resultant appeal was referred to the London (North West) Valuation Tribunal. Following a hearing on 7 March 2005 the tribunal dismissed the appeal on 31 March 2005 on the grounds that the originating proposal was invalid.
9. On 22 April 2005 Mr O'Brien lodged an appeal to this Tribunal which was ordered to be heard under the simplified procedure.

Discussion

10. There are two issues in this appeal. The first is whether the proposal dated 7 September 2004 is valid. If it is, the second issue arises: the correct rateable value of the appeal hereditament in the 2000 rating list. The VT found the proposal to be invalid "as it was received almost two years after the subject hoarding had been taken out of the 2000 List" and did not make a decision on the second issue. The rateable value of £2,790 therefore remained unchanged. The decision of the VT is brief; it gives no reasons which led to some confusion in the appeal which could have been avoided if the lower tribunal had referred to the statutory provisions or other matters on which they relied in reaching their decision. The burden of proof is on Mr O'Brien, as appellant, to show that the decision of the VT is wrong (Sole v Henning (VO) [1959] 3 All ER 398 at 399H).
11. On the first question (the validity of the proposal), Mr O'Brien's case appeared to contain three arguments. First, that an entry in the rating list for the appeal hereditament existed before he served his proposal and the six months rule applied to citations of tribunals or court decisions when included in proposals. Second, that having overlooked making a proposal, it would be contrary to natural justice that he should be liable for rates assessed on an absurd valuation based on dubious evidence. He could not say when, or even whether, he received the valuation officer's first notice of alteration. He was involved in a road accident on 20 January 2002. Third, Mr O'Brien said that the Lands Tribunal has a discretion to treat as valid a proposal made out of time.
12. The valuation officer's case is that the originating proposal was served in respect of his list alteration of 18 December 2001. The effect of regulation 13A(13)(a)(iii) of The None-Domestic Rating (Alterations of Lists and Appeals) Regulations 1993 ("the 1993 Regulations") was that the effective date for the proposal (if well-founded) was 1 April 2004. On that date the appeal hereditament had been deleted from the list: the proposal could not therefore have effect and was invalid.
13. I look first at the relevant statutory provisions. The Local Government Finance Act 1988 ("the 1988 Act") requires the valuation officer to compile and maintain local rating lists showing the assessments of relevant non-domestic hereditaments in the local authority's area (sections 41 and 42). A hereditament is a unit of property to be shown as a separate item in the list (section 64(1) and section 115 of the General Rate Act 1967). A relevant hereditament includes a right to use land for the display of advertisements, where the right is let out or reserved to a person other than the occupier or owner of the land (section 64 (4)(c) and (2)). "Land" includes a wall or other part of a building and a sign, hoarding, frame, post or other structure erected or to be erected on land" (section 64(11)). Accordingly, the advertising rights granted in respect of the flank wall of The Wishing Well public house at 110 Chase Side, Southgate were a separate hereditament for rating purposes. They came into existence at the earliest time at which either any structure or sign is erected (after the advertising right has been granted) to enable the right to be exercised, or when any advertisement is exhibited in pursuance of the right (the 1993 Regulations, regulation 14(1)). A person in occupation of a hereditament entered in the rating list is subject to non-domestic rates for each day of occupation (section 43(1)). An advertising right is treated as occupied by the person for the time being entitled to the right (section 65 (8)) the occupation commencing at the earliest time that the advertising hereditament came into existence (as above) (the 1993 Regulations, regulation 14(1)). Mr O'Brien signed his proposal as "occupier" and I find that he was the occupier of the appeal hereditament during the period when the advertising rights were entered in the rating list, i.e. from 1 April 2001 to 1 April 2002.
14. Section 55 of the 1988 Act (as amended) deals with the alteration of rating lists and gave the Secretary of State for the Environment the power to make regulations as to the alteration of lists, proposals and appeals. Under subsection (4) the regulations may include provision:-

"(a) as to who (other than a valuation officer) may make a proposal for the alteration of a list with a view to its being accurately maintained,

(b) as to the manner and circumstances in which a proposal may be made, and the information to be included in a proposal,

(c) as to the period within which a proposal may be made"

15. The 1993 Regulations were made under this power and apply to the 2000 rating list. They have been superseded by similar 2005 Regulations (to which Mr O'Brien referred at the hearing) but which apply to any rating list compiled on or after 1 April 2005. Regulation 4A(1) of the 1993 Regulations sets out the grounds for making a proposal. These include:-

"(a) the rateable value shown in the list for a hereditament was inaccurate on the day the list was compiled;

(b) …

(bb) …

(c) the rateable value shown in the list for a hereditament by reason of an alteration made by a valuation officer is or has been inaccurate;"

Mr O'Brien made his proposal incorrectly under sub para (a) (A on the proposal); it should have been made under sub para (c) (B on the proposal).

16. Regulation 4A(2) provides that an "interested person" may make a proposal where he has reason to believe that any of the grounds in para (1) exist. Regulation 2(1)(b)(i) defines an "interested person" to include "the occupier" of the hereditament. At the time when he made his proposal Mr O'Brien had ceased to be the occupier of the appeal hereditament (which no longer existed) but Mr Harding (very fairly to Mr O'Brien) drew my attention to para (4) of regulation 4A. This allows a person who is not an interested person to make a proposal in relation to an alteration of the list by the valuation officer (regulation 4A(1)(c)) if he was an interested person (occupier in this case) at any time during which the alteration had effect. Mr O'Brien made his proposal incorrect under subpara (a) of regulation 4A(1) but the valuation officer has (again very fairly) not taken this point against him. Having regard to this concession, therefore, Mr O'Brien had the power to make a proposal as a former occupier. Without the above concession, Mr O'Brien's proposal would have been invalid on the grounds that he was not the actual occupier and had no power to make a proposal (see Mainstream Ventures Limited v Woolway (VO) [2000] RA 395).
17. Regulation 4C of the 1993 Regulations sets out the periods in which proposals may be made for the 2000 list. Under paras (1) and (2) a proposal to alter an entry in the list compiled on 1 April 2000 (the incorrect grounds on Mr O'Brien's proposal) or in respect of an alteration to the list by the valuation officer (as Mr O'Brien's proposal is conceded to be by the valuation officer) must have been made at the latest by the date of the compilation of the next rating list, i.e. 1 April 2005. Mr O'Brien's proposal is not therefore out of time under this regulation.
18. Under regulation 9, where the valuation officer is of the opinion that a proposal is well-founded, he shall as soon as reasonably practicable alter the list accordingly. Disagreement as to whether a proposal is well-founded is referred to a valuation tribunal as an appeal (regulation 12).
19. I now consider regulation 13A, which is the basis of the valuation officer's case on invalidity. This regulation sets out the various dates on which alterations to the 2000 rating list shall have effect. Para (13) provides as follows:-

"Subject to paragraph (14), where an alteration is made to correct an inaccuracy in a list which arose in the course of making an alteration in connection with any of the matters mentioned in foregoing paragraphs of this regulation then –

(a) where the alteration is made in pursuance of a proposal, it shall have effect as follows –

(i) if the proposal is served on the valuation officer within 6 months of the date of the date of the previous alteration, from the date on which the previous alteration fell to have effect;

(ii) if the proposal is served on the valuation officer after 6 months from that date but on or before 30^th June 2002, from the date on which the previous alteration fell to have effect or 1^st April 2001 whichever is the later;

(iii) if the proposal is served on the valuation officer after 6 months from that date and after 30^th June 2002, from the date on which the previous alteration fell to have effect or the first day of the financial year in which the proposal is served, whichever is the later;"

20. Mr O'Brien's proposal was served on the valuation officer on 8 September 2004. This was more than six months from the date of the previous alteration and after 30 June 2002. Sub-para (a)(iii) above therefore applied and the proposal would have had effect (if well-founded) from the date on which the previous alteration fell to have effect or the first day of the financial year in which the proposal was served (1 April 2004), whichever is the later. The later date is 1 April 2004. At that date, however, the appeal hereditament was not entered in the rating list, having been deleted by the valuation officer's notice dated 22 October 2002 with effect from 1 April 2002. No effect therefore could be given to the proposal because the hereditament to which it related did not exist and was not then entered in the list. I agree with the valuation officer that no effect could be given to the proposal and that it is therefore invalid. Mr O'Brien said that the six months period should run from the date when he first became aware of the notice of alteration but, as he could not tell me when this occurred, I find that this point has no substance.
21. Mr O'Brien, however, argued that this result is unfair; it is contrary to natural justice that he should be liable for rates on an incorrect valuation. The essential question is, however, in my view, not whether the above regulations produce an unfair result, but whether this Tribunal has any power or discretion to vary or disregard the regulations in order to produce a different result. Mr O'Brien was unable to refer me to any statutory provisions, regulations or authorities which give this Tribunal the power to disregard the effect of the relevant regulations. I am satisfied that this power does not exist.
22. In Esau Brothers v Rodd (VO) [1992] RA 257, the Tribunal considered the effect of a six months time limit for the service of proposals in Regulations which preceded those in this current appeal. The occupiers of a hereditament served a proposal one day late. The valuation tribunal treated it as invalid and dismissed the ratepayers' appeal. They appealed to this Tribunal and argued that the Lands Tribunal has a discretion to allow a proposal out of time as a matter of justice and common sense. The former President, Judge Marder QC, said (at 261):-

"Whilst not entirely without sympathy for the ratepayers, it is clear that the valuation and community charge tribunal decision was correct and inevitable on the facts. The only proposal which the valuation officer or the tribunal is empowered to entertain for the purposes of reg 9(2) is a proposal served within the prescribed six months' period. As to the Lands Tribunal, it must be emphasised that this Tribunal is wholly a creature of statute and possess no more power than Parliament has seen fit to confer on it. Where it is clear that a discretion exists, this tribunal will of course exercise it. There is indeed an example in these very regulations. Regulation 45(2) is couched in terms which confer a discretion to entertain an appeal to the Lands Tribunal made outside the four week period there prescribed. There is also the general power in r 48 of the Lands Tribunal Rules 1975 to extend time in relation to proceedings before the tribunal. But there is no residual discretion to extend a time limit such as that contained in reg 9(2) of the 1990 regulations so as to meet the apparent justice of a particular case."

23. I agree with the reasoning behind this decision. Similarly, the valuation officer and VT in this appeal had no power to consider a proposal to which no effect could be given due to the date of service and the effect of regulation 13A (13)(a)(iii) of the 1993 Regulations. My conclusion on the first issue is, therefore, that, for the reasons given above, the originating proposal in this appeal was invalid and of no effect. The decision of the VT was correct, notwithstanding the lack of reasons. Accordingly, the appeal is dismissed.
24. Although it is not now necessary for me to deal with the second issue (the correct rateable value of the appeal hereditament) I will do so briefly. If I had reached the opposite conclusion on the first issue, and found the proposal to be valid, I would not have been persuaded that the rateable value in the list was incorrect. I would have dismissed the appeal on this ground. The appellant's case on this point was wholly lacking in substance.
25. Mr O'Brien said that the rateable value of the appeal hereditament should be reduced to £1,540. Initially, he gave two reasons for this lower assessment: the rent and the assessment of another advertising site. As to the rent, in his statement of case he correctly stated that the actual rent is the correct starting point when making a valuation for rating purposes. He said that the rent was £1,800. The valuation officer was unaware of this rent. I ask Mr O'Brien for evidence in support, eg a written agreement, but he was unable to produce any supporting evidence. He then abandoned reliance on the rent. He also referred to a comparable advertising hoarding in Redbridge. He was unable to give the address, only the approximate location. In his statement of case he referred to it as "in a matter I did not overlook in the vicinity the same value was reduced to £1,800." At the hearing he said that this was a 48-sheet advertising site where the rateable value was reduced from £2,790 to £1,540. Presumably this was an advertising site where Mr O'Brien was the occupier and served a successful proposal resulting in a substantial reduction in the list assessment. I asked Mr O'Brien for some supporting evidence but he had none. I asked Mr Leahy if he could assist but he was unable to help. He had no knowledge of this assessment. There is no support for this alleged comparable. I find the evidence relating to the rent and the comparable wholly inadequate to support a successful challenge in this appeal.
26. Mr Leahy referred to one comparable to support his valuation of the appeal hereditament, an advertising hoarding adjoining Balaams Lane, High Street, London N14, about 800 metres from the appeal hereditament. The assessment was agreed with the occupier's agents at rateable value £6,270, which devalued to £2,000 for a 48-sheet poster. Mr Leahy said that the location of the appeal hereditament was superior for advertising rights, on a busy through route, compared to the residential area at Balaams Lane. For the appeal hereditament he adopted £2,750 for a 48-sheet poster with the addition of £38 for the structure. Mr O'Brien disagreed that the location of the appeal hereditament was better than the comparable.
27. I am not persuaded by Mr O'Brien's brief, vague and unsupported evidence, compared to Mr Leahy's reasoned valuation (albeit only supported by one comparable), that the rateable value of £2,790 in the list was wrong. The appeal would have been dismissed on this ground.
28. Neither party asked for costs and I make no order as to costs.

DATED 4 November 2005

(Signed) P H Clarke