Assessor for Lothian Valuation Joint Board v McLaughlin
| Jurisdiction | Scotland |
| Judgment Date | 22 April 2020 |
| Neutral Citation | [2020] CSIH 16 |
| Date | 22 April 2020 |
| Docket Number | No 24 |
| Court | Court of Session (Inner House) |
[2020] CSIH 16
Second Division
Valuation Appeal Committee
Baptist v Masters of the Bench and Trustees of the Honourable Society of Gray's Inn [1993] 2 EGLR 136; [1993] 42 EG 287
Customs and Excise Commissioners v JH Corbitt (Numismatists) Ltd [1981] AC 22; [1980] 2 WLR 653; [1980] 2 All ER 72; [1980] STC 231; [1980] TR 165; 124 SJ 292
Edinburgh Council (City of) v GD [2018] CSIH 52; 2019 SC 1; 2018 SLT 1145; 2019 SCLR 228
Grampian Valuation Joint Board (Assessor for) v Brownlie 2003 SC 245; 2003 SLT 327; [2003] RA 167; [2004] RVR 34
Inland Revenue Commissioners v Clay [1914] 3 KB 466
Lothian (Assessor for) v Holland [2010] CSIH 53; 2010 SC 743; 2010 SLT 1149; [2010] RA 510
Lothian (Assessor for) v Martin [2010] CSIH 54; 2010 SC 749; 2010 SLT 1173; [2010] RA 518
McKenzie (Listing Officer) v Marshall [2008] EWHC 641; [2008] RA 269
Moray Council v Scottish Ministers [2006] CSIH 41; 2006 SC 691; 2007 SCLR 55; 2006 GWD 25–578
Strathclyde (Assessor for) v Rea 1995 SC 577; 1996 SLT 998; 1995 SCLR 1048; The Scotsman, 30 August 1995
Ted Jacob Engineering Group Inc v Morrison [2019] CSIH 22; 2019 SC 487; 2020 SLT 14
Thorburn v Assessor for Peeblesshire 1941 SC 232; 1941 SLT 251
West v Secretary of State for Scotland 1992 SC 385; 1992 SLT 636; 1992 SCLR 504; The Scotsman, 5 May 1992; The Times, 11 June 1992
Edinburgh Council (City of), A Guide to Golden Share (City of Edinburgh Council, Edinburgh, March 2018) (Online: https://espc.com/media/5430/a-guide-to-golden-share-for-customers-march-2018.pdf (28 May 2020))
Valuation Office Agency, Practice Note 1: England only: Definition of dwelling and basis of valuation for council tax (Valuation Office Agency, London, 5 May 2017), para 4.10 (Online: www.gov.uk/guidance/council-tax-manual/council-tax-practice-notes (28 May 2020))
Valuation — Subjects — Council tax — Purchase of affordable housing unit at discounted market value — Whether discount should be disregarded for the purposes of valuation for council tax — Local Government Finance Act 1992 (cap 14), sec 86 — Council Tax (Valuation of Dwellings) (Scotland) Regulations 1992 (SI 1992/1329 (S 126)), reg 2(1)
The Assessor for Lothian Valuation Joint Board appealed to the Court of Session against a decision of the valuation appeal committee, following an appeal hearing, on 26 January 2017.
The Local Government Finance Act 1992 (cap 14) (‘the 1992 Act’), sec 86, requires a local assessor to compile a valuation list and to assign a valuation band to each dwelling in his area. Subsection (2) provides, “The valuation shall be carried out … on such assumptions and in accordance with such principles as may be prescribed”.
The Council Tax (Valuation of Dwellings) (Scotland) Regulations 1992 (SI 1992/1329 (S 126)) (‘the 1992 Regulations’), reg 2(1), provides that, for the purposes of valuations under sec 86(2) of the 1992 Act, “the value of any dwelling shall be taken to be the amount which the dwelling might reasonably have been expected to realise if it had been sold in the open market by a willing seller”.
The respondent and his wife purchased a property (‘the property’) within a new housing development. The seller, a developer, had entered into an agreement with the local planning authority as to the provision of affordable housing units. The property was one of such affordable housing units. The purchase price of the property was 80 per cent of the open market valuation of similar dwellings within the development. Provisions in the title to the property directed that future sales should also be at a price which was 80 per cent of the open market valuation (the ‘golden share’ provisions). The agreement between the developer and the local planning authority regulated the sale of affordable housing units.
Under Pt II of the 1992 Act, the assessor required to list the property in the valuation list. The assessor listed the property within band D on the basis that the golden share provisions ought to be disregarded for the purposes of valuation. Under reg 5(1)(b) and (5) of the Council Tax (Alterations of Lists and Appeals) (Scotland) Regulations 1993 (SI 1993/355 (S 39)), the respondent proposed that his property should be listed within band C. The assessor disagreed and referred the matter to the valuation appeal committee.
The valuation appeal committee decided that, in valuing the property, the golden share provision required to be taken into account and remitted the matter of valuation back to the assessor. The assessor appealed and argued that the committee had erred in law in deciding that the golden share provisions required to be taken into account under reg 2 of the 1992 Regulations.
Held that: (1) the agreement between the developer and the local planning authority created restrictions on the sale of the property which were irreconcilable with an open market sale and the court was not bound to conclude that the property required to be valued on the basis that the restrictions in the agreement applied (paras 30, 31); (2) the committee had focused on the sale price which could have been achieved by a proprietor if constrained by the golden share restrictions, rather than focusing on the open market value of the property in accordance with reg 2 of the 1992 Regulations, and had failed to appreciate that the golden share restrictions were incompatible with the statutory hypothesis and had, thus, erred in law (para 35); and appeal allowed.
Observed that the committee had no supervisory jurisdiction over the assessor's exercise of his statutory functions and the committee ought to have decided the appeal one way or the other on the basis of the evidence and had no power to direct that the assessor revalue the subjects (para 36).
Assessor for Grampian Valuation Joint Board v Brownlie 2003 SC 245 distinguished and McKenzie (Listing Officer) v Marshall[2008] RA 269considered.
The cause called before the Second Division, comprising the Lord Justice Clerk (Dorrian), Lord Malcolm and Lord Doherty, for a hearing, on 7 January 2020.
At advising, on 22 April 2020, the opinion of the Court was delivered by Lord Doherty—
Opinion of the Court—
[1] This is a council tax appeal to the Court of Session on a point of law in terms of sec 82(4) of the Local Government Finance Act 1992 (cap 14) (‘the 1992 Act’) from a decision of Lothian Valuation Appeal Committee (‘the committee’). The appellant is the Assessor for Lothian Valuation Joint Board (‘the assessor’). The respondent and his wife are the joint proprietors of a ground floor flat at Stanwell Street, Edinburgh (‘the Appeal Subjects’). The issue raised by the appeal is how affordable housing units which are subject to ‘golden share’ provisions ought to be valued for council tax purposes.
[2] In November 2016 the respondent and his wife purchased the Appeal Subjects from the developer, Persimmon Homes Ltd (‘Persimmon’), at a price of £129,600. They took entry on 24 November 2016 and they became registered proprietors on 11 January 2017.
[3] The Appeal Subjects form part of a development of 49 new houses and flats built on a site of 0.78 hectares at Silverfields (‘the Agreement Subjects’). In order to obtain planning permission for the development Persimmon ‘in its capacity as heritable proprietors of the Agreement Subjects (who and whose successors as proprietors of the Agreement Subjects are hereinafter referred to as “the Proprietors”)’ entered into a minute of agreement (‘the agreement’) with the City of Edinburgh Council (‘the council’) pursuant to sec 75 of the Town and Country Planning (Scotland) Act 1997 (cap 8).
[4] Section 75 (as amended by the Planning etc (Scotland) Act 2006 (asp 17)) provides:
‘Planning obligations
75.–(1) A person may, in respect of land in the district of a planning authority–
(a) by agreement with that authority, or
(b) unilaterally,
enter into an obligation (referred to in this section and in sections 75A to 75C as a “planning obligation”) restricting or regulating the development or use of the land, either permanently or during such period as may be specified in the instrument by which the obligation is entered into (referred to in this section and in those sections as the “relevant instrument”).
(2) Without prejudice to the generality of subsection (1), the reference in that subsection to restricting or regulating the development or use of land includes–
(a) requiring operations or activities specified in the relevant instrument to be carried out in, on, under or over the land, or
(b) requiring the land to be used in a way so specified. …
(5) A relevant instrument to which the owner of the land is party may be recorded in the Register of Sasines or, as the case may be, registered in the Land Register of Scotland; and if the instrument is so recorded or registered then the planning obligation is (unless the instrument provides that only the person entering into that obligation is to be bound by it) enforceable at the instance of the planning authority–
(a) against the owner of the land in so far as the obligation comprises a requirement mentioned in subsection (2) or (3)(b), and
(b) against–
(i) the owner or tenant of the land, or
(ii) any other person having the use of the land,
in so far as the obligation comprises any other requirement.‘
[5] The agreement is registered in the Land Register of Scotland. It is set out in the burdens section of the registered title of the Appeal Subjects (as burden 6). In terms of the agreement it was agreed that 11 of the housing units on the site would be affordable housing units and that the remaining 38 would be open market housing units. It was also agreed that the obligations undertaken by the proprietors in the agreement shall be enforceable by the council as planning authority and roads authority against the...
To continue reading
Request your trial