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EXTRA DIVISION, INNER HOUSE, COURT OF SESSION
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Lord Osborne
Lord Drummond Young
Lord Penrose
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[2008] CSIH 48
XA83/07
OPINION OF THE COURT
delivered by LORD OSBORNE
in
APPEAL TO THE COURT OF
SESSION
Under section 82 (4) of
the Local Government finance Act 1992
by
THE HIGHLAND COUNCIL, a
local authority constituted under the Local Government etc. (Scotland) Act
1994
Appellant;
against
A decision of Highland and
Western Isles Region Valuation Appeal Committee, undated, communicated to the
Appellant on 24th April 2007
Respondent;
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Act: Participating party at this hearing S. Stuart, Advocate; Biggart Baillie
Alt: Non participating
party; Simpson & Marwick
5 August 2008
The Background Circumstances
[1] The
taxpayer, Mr Carl Beck, has been the owner of a dwellinghouse at 4 New Houses,
Ackergill, Wick, since October 2001. His
permanent full-time employment is with the United Kingdom Atomic Energy
Authority at their establishment at Dounreay, Thurso, Caithness. The taxpayer has a wife and daughter, who
reside at 33 Clyde Street, Invergordon, where the taxpayer frequently resides
at weekends.
[2] By
letter dated 6 April 2006 the Area Finance Manager of the appellant intimated
to the taxpayer that his dwellinghouse at 4 New Houses, Ackergill, Wick was to
be treated as a "second home" within the meaning of Regulation 1 (2) of the
Council Tax (Discount for Unoccupied Dwellings)(Scotland) Regulations 2005
(2005 No.51). By virtue of that
decision, the taxpayer was entitled to a discount of 10% of the council tax
payable in respect of that dwellinghouse.
That decision was affirmed by the Head of Exchequer of the appellant in
a letter to the taxpayer, dated 25 July 2006.
The contention of the taxpayer at that time had been that he was
entitled to a discount of 50% of the relevant council tax, upon the view that 4
New Houses, Ackergill, Wick, was a "job-related dwelling", within the meaning
of paragraph 2 of the Schedule to the 2005 Regulations. Following the affirmation of the appellant's
decision, on 31 July 2006 the taxpayer appealed that decision to the Highland
& Western Isles Region Valuation Appeal Committee in terms of section 81
(1)(b) of the Local Government Finance Act 1992.
[3] The
taxpayer's appeal came before the Committee on 16 April 2007 when the taxpayer
appeared in person and gave evidence.
Evidence was also given by Mr W D D Lamont the Head of
Exchequer of the appellant. By a
decision communicated on 24 April 2007 the Committee found that the taxpayer
had had his main residence at 4 New Houses, Ackergill, Wick from October 2001
until the present date and that he is and has been the sole occupier. It followed that the council tax bill for
that dwelling ought to be subject to a 25% discount throughout that
period. Such a discount is provided for in
section 79 (1)(a) and (3) of the Local Government Finance Act 1992.
[4] The
appellant has now appealed the decision of the Committee under section 82 (4)
on a point of law to this Court. The
Committee have lodged Answers to the Appellant's Appeal, in which they admit
that, in reaching their decision, the Committee had regard inter alia to the balance of time that the taxpayer resided at each
address and the lack of firm evidence indicative of the Invergordon house being
his main residence. In their answers the
Committee contend that they were entitled, on the evidence before them, to
conclude that 4 New Houses, Ackergill, was the taxpayer's main residence and
that they did not err in law in doing so.
In their answers the Committee state that the evidence before them was
(i) that the taxpayer was in secure permanent employment in a staff position at
Dounreay; (ii) that he had been the owner and sole occupier of 4 New Houses
since October 2001; (iii) that his wife and daughter remained in Invergordon
because his wife's elderly parents lived nearby, her father was in poor health
and the taxpayer and his wife did not wish their daughter's secondary schooling
to be disrupted; (iv) that the taxpayer normally stayed at Ackergill from
Monday to Friday each week and for longer in the winter; and (v) that he stayed
at Ackergill some weekends, but that most weekends he stayed at
Invergordon. The Committee in their
answers state that they considered all material facts that were
established. They aver that the witness
for the appellant, Mr Lamont, made reference to a variety of criteria that he
opined might be relevant. In relation to
most of these criteria, no evidence was led, viz. (a) whether the
taxpayer intended to return to 33 Clyde Street; (b) where most of the
taxpayer's personal belongings were kept; (c) where Mr Beck was registered on
the Electoral Roll; and (d) where the taxpayer had his bank account, dentist,
and doctor. By letter dated 19 October
2007 from solicitors acting for the Committee, it was intimated to the Court
that they did not wish to appear at the hearing before us and wished to confine
their representations to us to those expressed in their Answers. The taxpayer himself was not represented at
the hearing before us.
Submissions of the Appellant
[5] In
submitting that the Committee had erred in law in holding that 4 New Houses,
Ackergill, Wick was the taxpayer's main residence during the relevant period,
counsel drew our attention to the relevant provisions of the Local Government
Finance Act 1992 and of the 2005 Regulations.
While Regulation 5 conferred a discretion upon the appellant to set the
discount for council tax in relation to second homes within the range of a
minimum of 10% to a maximum of 50%, the appellant had set the discount for
their area at 10%. In the case of a
dwellinghouse which was a taxpayer's "sole or main residence", within the
meaning of section 99 of the Local Government Finance Act 1992, a discount of
25% was available, in terms of section 79 (3), of the 1992 Act.
[6] In
supporting the appeal, counsel drew our attention to several authorities,
including Bradford Metropolitan City
Council v Anderton [1991] RA45,
which was concerned with the meaning of the expression "sole or main
residence", Regina v Horsham District Council [2004] 1W.L.R.
1137, and Stevenson v Rogers 1992 S.L.T. 558. Essentially the appellant's contention was
that, in reaching a conclusion as to whether a dwellinghouse was a taxpayer's
"sole or main residence", it was necessary to look at a range of factors of
which the time spent in any particular residence was important, but not
determinative.
[7] Counsel
for the appellant recognised however that his submissions were constrained by
the findings in fact made by the Committee.
These were very limited.
Nevertheless, the Committee had, in effect, confined itself to considering
the balance of time spent by the taxpayer in the two different residences. It was not clear that they had made
appropriate inferences from the fact that the taxpayer's wife and daughter
resided apparently at 33 Clyde Street, Invergordon. The Committee had not engaged in appropriate
reasoning. The Court should remit the
matter to the committee for fresh consideration. However, counsel accepted that the Committee
were entitled, on the facts found, to conclude that 4 New Houses, Ackergill,
Wick, was the sole or main residence of the taxpayer. The criticism of that decision was that they
had not engaged in appropriate reasoning.
Had they done so, their decision could have gone in either direction on
the basis of the material before them.
The decision
[8] In
our view, it is important to take into account the Committee's reasons for
their decision. They are stated in this
way:
"The
following facts were stated in evidence by Mr Beck and agreed by the
Respondents legal representative.
1.
Mr Beck has been the owner and sole occupier of 4 New
Houses, Ackergill since October 2001.
2.
He resides there normally for four nights (five days)
each week and sometimes more, in order to attend at his nearby place of
permanent full-time employment (Dounreay).
3.
At weekends he frequently stays with his wife and
daughter at 33 Clyde Street, Invergordon.
4.
While he resides in Ackergill, his wife and daughter
continue to reside in Invergordon to ensure continuity in family
responsibilities and education.
From
evidence provided by Mr Lamont, (the Highland Council Head of Exchequer) the
Committee understood that the Highland Council had determined from their
enquiries that the house, 4 New Houses, Ackergill was not the Appellant's main
residence, primarily on the ground that as he returned to Invergordon at
weekends to spend time with his wife and daughter, it was reasonable to
conclude that the place where his wife and child live constituted his main
residence.
The
Respondents did not lead sufficient evidence to counter the Appellant's
position that 4 New Houses, Ackergill, was his main residence. In particular, although the respondents
considered a variety of criteria (set out in the IRRV guidelines dated Autumn
2005, produced by the Respondents) to be relevant, they did not discuss with Mr
Beck whether these were in fact relevant to his personal circumstances.
When asked
if his staff had sought details of the relevant criteria (location of GP,
dentist, et cetera), Mr Lamont replied that he was not certain if these questions
were asked specifically. The solicitor
appearing for the council did not ask them of Mr Beck in front of the
Committee. It therefore appeared to the
Committee that the Council officials had not had available to them the
information that they asserted to the Committee was important in justifying
their decision as to Mr Beck's main residence.
Nor could they present it to the Committee to post-justify their
decision and inform the Committee's own determination.
Having
regard to Stevenson v Rogers 1992 S.L.T. 558 the Committee
noted and took into account the distinction at page 562H between determining
where a person is 'mainly resident' and where he has his main residence. From the same case, however, the Committee
also noted that the determination of this issue is essentially an issue of fact
and degree (LGC at 561G) and that although the time spent in one area is not
conclusive, it must be one of the most important criteria to be considered,
along with other material facts (562L).
In the
light of the guidance provided in Stevenson
v Rogers; the evidence given as to
the balance of time that Mr Beck resides at each address and the lack of firm
evidence that his Invergordon house might reasonably be regarded as his main
residence, the Committee found that Mr Beck has his main residence in Ackergill."
[9] In
our view, it is quite clear that the Committee did engage in appropriate
reasoning in connection with the taxpayer's appeal to them. It is evident that they were well aware of
the criteria which might be relevant in a determination of the location of a
"sole or main residence". However, the
difficulty which they faced, for which the appellant must be seen as
responsible, was that they did not have furnished to them evidence relating to
the range of relevant criteria, other than the time spent by the taxpayer in
the two houses and the fact that his wife and daughter resided at 33 Clyde
Street, Invergordon, either in the form of material elicited from the taxpayer
in cross-examination by the solicitor for the Council, or in the form of
evidence led from Mr Lamont, the Council witness, or any other witness. In the light of that state of affairs, we
conclude that the Committee did not err in law in any respect. As was accepted by counsel for the appellant,
they were entitled on the facts which they found to conclude that 4 New Houses,
Ackergill, Wick was the sole or main residence of the taxpayer. More particularly, we consider that the
reasons which we have quoted from the Committee's decision demonstrate that
they did in fact engage in appropriate reasoning. Accordingly, the narrow ground of attack on
their decision advanced by counsel for the appellant, which was the only
criticism that he could make in the circumstances, in our opinion, fails. For these reasons we shall refuse the appeal.
