Scottish Court of Session Decisions

Now, this tax was originally imposed by the 48th of Geo. III. cap. 55, upon dwelling-houses throughout Great Britain; and all exemptions which subsequent statutes have introduced must be read with special reference to that general enactment.

Upon the first point raised in the case I have therefore no doubt. But it is maintained further that the stables which are occupied by this hotelkeeper ought to be dealt with separately from the house, and that they being occupied for business purposes only, and not as a dwelling-house, ought to be exempted from the duty. Now, the ground upon which that is maintained is the provision contained in the first sub-section of this same section 13, which I have already mentioned in reference to the first part of the case. But it appears to me that that sub-section has been mis-read; and in order to understand it fully it is quite necessary to go back to the enactments in the 48th of Geo. III. cap. 55, because in Schedule B, which contains the rules for charging the duties on inhabited houses, we have a provision in the sixth of these rules, for the case of houses let in separate apartments, and it is provided that they shall be assessed as one house. Under the second rule it is provided that every coach-house, stable, brew-house, wash-house, wood-house, and so forth, enumerating a great many other things “belonging to and occupied with any dwelling-house, shall in charging the said duty be valued together with such dwelling-house.”

Now, the section in the recent Act (41 Vict, cap. 13) relied upon (the first sub-section of section 13) provides that—“Where any house, being one property, shall be divided into and let in different tenements, and any of such tenements are occupied solely for the purposes of any trade or business, or of any profession or calling by which the occupier seeks a livelihood or profit, or are unoccupied, the person chargeable as occupier of the house shall be at liberty to give notice in writing at any time during the year of assessment to the surveyor of taxes for the parish or place in which the house is situate, stating therein the facts; and after the receipt of such notice by the surveyor, the Commissioners shall, upon proof of the facts to their satisfaction, grant relief from the amount of duty charged in the assessment, so as to confine the same to the duty on the value according to which the house should in their opinion have been assessed, if it has been a house comprising only the tenements other than such as are occupied as aforesaid or are unoccupied.”

Now, it appears to me very clear that the object of that provision is to alter the sixth rule, but not to interfere in any way with the second rule, which provides that stables and premises of that kind shall be assessed along with the house to which they are attached. Therefore that second rule remains untouched by subsequent legislation. But it is contended that the stables in this case are let for a separate rent from the hotel. But it does not appear to me that that makes any difference. They are occupied together, and for one combined purpose, so far as we can gather from anything that is stated in the case. I can quite understand a person in the position of the appellant here having an establishment of stables and coach-houses, and so forth, which he occupied solely for a purpose not necessarily connected with his hotel—for the purpose of a great coaching establishment and the like; and I am not by any means prepared to say that such premises as these so occupied would necessarily be assessable along with a hotel merely because they were in the occupancy of the same person. But there is nothing here to lead us to suppose that the stables in question are anything but ordinary hotel stables; and therefore I think there can be no relief on that branch of the case any more than on the other.

Lord Deas—The first question is, Whether this house is to be regarded as an inhabited house and dwelling-house, and so liable to the inhabited house-duty?

Now, it is not disputed that the house is a hotel in the full sense of that word—a hotel in which people are accommodated by day and by night, and, in short, in which they live and dwell just as much as if it was their own house. So far as the business is concerned, it goes on by night as well as by day; and the servant or servants who are there are not there to take care of the premises, but in order to attend to the guests, and to carry on the business of the hotel. It would be a very remarkable thing if every hotel were to be exempted from this tax because the landlord or proprietor of the hotel, or the tenant in the position of a landlord, did not himself sleep in that hotel. We all know that many proprietors or lessees have a number of hotels in different places—in different parts of the country—sometimes in England as well as in Scotland. These parties cannot sleep in all their hotels; and it would be a very curious result if the one the party sleeps in were to be taxed and not the others. I do not know what would become in that case of the assessment upon the railway companies who have large hotels at different stations in which hundreds of people dwell and are accommodated. It would surely be very anomalous if because the landlord was the railway company, and did not sleep in any of them, that they were to be exempted from the inhabited house-duty. I do not think that is at all a right construction, and I have therefore no doubt upon that point.

The other point is certainly a more delicate one. It depends, as your Lordship has put it, on whether the landlord is carrying on a separate kind of business in his stables and offices from that which is carried on in the hotel. That certainly, as your Lordship has remarked, is a thing that might quite well be. There might be a posting establishment quite separate from the hotel; and I should not be prepared any more than your Lordship to say that such an establishment, or the premises for such an establishment, would be liable to the inhabited house-duty along with the hotel. But I agree with your Lordship that in this case the occupation of the stables and offices is so connected with the hotel and the business carried on in the hotel that they must be regarded as one and the same concern. I am of opinion on these grounds that these premises must be all included in the valuation and liability for the inhabited house-duty.

Lord Shand—I am of the same opinion. There can be no doubt that this hotel is occupied as an inhabited house or dwelling-house. The case does not show very distinctly whether the person charged with the duty himself resides in the house at night. There is a passage which might be read as meaning that either he or his wife resides in the house at night. But I do not think it of any consequence how that may be, because it is clear that there are servants permanently there residing in the house by day and by night, and also that there is constantly a number of guests in the house who occupy it as a dwelling-house. It is a dwelling-house clearly in the ordinary sense of the term. Although the person charged with the duty as occupier of the house does not personally reside there, if he keeps it, using it as a residence for his servants and guests, it is nevertheless an inhabited house, and accordingly the case falls plainly within the spirit and letter of the earlier Acts of Parliament. The only question that arises is, whether the exemption in the statute of 41 Vict. cap. 15, can, notwithstanding that this is the very kind of house that it was intended to make subject to taxation, be held to relieve the occupier of the house from the duty. That statute provides that “Every house or tenement which is occupied solely for the purpose of any trade or business, or of any profession or calling by which the owner seeks a livelihood or profit, shall be exempted from the duties by the said Commissioners upon proof of the facts to their satisfaction;” and then follow what I think are very important words—“And this exemption shall take effect although a servant or other person may dwell in such house or tenement for the protection thereof.” I think it is impossible to read that exemption in the way that seems to be contended for by the occupier here, as it would exempt from the duty a person who was carrying on a business the very purpose and object of which is to make profit of the house as a dwelling-house. He is carrying on a business there no doubt, but the business he is carrying on is to use the building as a dwelling-house—being the very class of house that the statutes are intended to include and make liable to assessment. That is quite apparent when one looks at the concluding words. The exemption is to have effect although the owner's servant or other person may be there, if there merely for the protection of the house—showing that the exemption cannot on any reasonable construction of it be applied to a house which is obviously used as a dwelling-house, and as to which the success of the business carried on depends on its being constantly used as a dwelling-house.

On that branch of the case, accordingly, I have no difficulty in agreeing with your Lordships. I think the occupier of this house is responsible for it as an inhabited house, because he occupies it as a dwelling-house through his servants and the guests he may receive.

On the second point I have nothing to add. I think the case shows that these stables are in the first place in connection physically to some extent with the hotel, and in the next place are used in connection with the private hotel business. Taking the case as of that kind, I am of opinion that no distinction can be made between the hotel and the stables as a part of the premises.

Lord Deas—As has been observed now and formerly, there is a want of precision in the statement of the case, particularly in the words alluded to by Lord Shand, which might lead to the supposition that the man or his wife sleeps in the hotel. I understand that in reality neither of them do so.

Lord Shand—For my part I think that quite immaterial.

Lord President—And so do I. I deal with the case as the ordinary case of an hotel.

Lord Mure was absent.