Assessor for Midlothian v A. & R Scott Ltd
| Jurisdiction | Scotland |
| Judgment Date | 11 March 1959 |
| Docket Number | No. 18. |
| Date | 11 March 1959 |
| Court | Lands Valuation Appeal Court (Scotland) |
Lands Valuation Appeal Court.
ValuationValueSubjectsDerating"Industrial lands and heritages"Grain mill and silos used for cleaning and drying oats and storing them before millingRating and Valuation (Apportionment) Act, 1928 (18 and 19 Geo. V, cap. 44), secs. 3 (1) and 4 (2) (a).
By sec. 3 (1) of the Rating and Valuation (Apportionment) Act, 1928, lands and heritages entitled to derating include factories, provided that they are not primarily occupied and used for certain enumerated purposes including (d) "purposes of storage." Sec. 4 (2) (a) further enacts:"The [lands and heritages] shall be deemed to be occupied and used for industrial purposes except in so far as any part thereof is, under this Act or under the enactments relating to the regulation of mines, factories, and workshops, to be deemed neither to be, nor to form part of, a mine, factory, or workshop."
A company manufacturing cereal products from oats owned and occupied mill premises where they cleaned and dried oats and then stored them in two large silos to await further processing at other mills operated by them elsewhere. The Assessor entered the buildings in the Roll apportioning the net annual value and giving the mill the benefit of industrial derating, but not the silos, which he classed as non-industrial.
Held that the silos were part of lands and heritages which were occupied and used for industrial purposes; but, as they were used for the purpose of storage, which was one of the exceptions enumerated in subsection 3 (1), they fell to be deemed, under subsection 4 (2) (a), neither to be nor to form part of lands and heritages entitled to industrial derating.
At a meeting of the Valuation Committee for the County of Midlothian, A. & R. Scott Limited appealed against an entry in the Valuation Roll for the year 19581959 in respect of a grain mill and silos situated at Wallace Mill, Midcalder, of which they were shown as proprietors.
The Committee having allowed the appeal, the Assessor expressed dissatisfaction and asked for a case to be stated on appeal to the Lands Valuation Appeal Court.
The case stated that the following facts were admitted or were held by the Committee to be proved or within the knowledge of the Committee:"(1) The appellants are manufacturers of cereal products, in particular Scott's Porage Oats, and are proprietors and occupiers of the subjects at Wallace Mill, Midcalder. (2) The subjects under appeal, described as grain mill and silos, comprise premises where grain is cleaned and dried by mechanical means, two silos each capable of holding 2000 tons of oats, and several ancillary buildings. The floor area of the various buildings is as follows:
Cleaning and drying house and switchhouse |
1,480 sq. ft. |
Silos |
16,080 sq. ft. |
Garages, stores and workshops |
4,778 sq. ft. |
Offices |
898 sq. ft. |
The silos are new buildings now entering the Roll for the first time. (3) The appellants are also proprietors and occupiers of mills at Colinton and Cupar, at both of which they have full industrial derating. (4) The appellants are also proprietors and occupiers of a mill at Leith where, until recently, they carried out all stages of their manufacturing process. This mill, which formerly produced approximately one-third of the appellants' total output, has recently been closed down owing to obsolescence of plant. (5) The gross annual value of the appellants' mill at Colinton is 2650 and it has a total floor area of 107,839 sq. ft. The silo capacity is 1300 tons. The capacity of the milling plant is 4 tons of grain per hour. (6) The silo capacity of the appellants' mill at Cupar is 5800 tons. (7) The silos now built at Midcalder with a capacity of 4000 tons replace the storage capacity of 1300 tons previously available at Leith, and the facilities for cleaning and drying oats provided at the subjects of appeal replace those formerly available at Leith; but the facilities for milling oats previously available at Leith have not been replaced at Midcalder. (8) The appellants carry out two initial stages of their manufacturing process at Midcalder; namely, cleaning and drying oats. The oats, which are purchased by the appellants from farms, are delivered at Midcalder into the receiving bins of the cleaning and drying plant, and, after passing through that plant, are conveyed to the silos where they remain till removed to Colinton or Cupar where the oats are milled and the manufacturing process is completed. Only the said two initial stages of the manufacturing process are carried out in the subjects under appeal. The length of time the oats may remain in the silos at Midcalder varies from one month to six months, depending upon the supply situation and the requirements of the said two mills. There is a comparatively constant demand throughout the year from the said two mills for oats from the subjects of appeal, but the supply of oats thereto is subject to seasonal fluctuations. The silos at the subjects of appeal ensure that this demand can be met at any time. (9) While in the silos the oats are not subjected to any manufacturing process, but their retention there tends to condition the oats by eliminating unevenness of moisture content remaining after the drying process. (10) The total capacity of the two silos at Midcalder is 4000 tons. The output of the cleaning and drying plant is 3 tons per hour. The capacity of the silos thus represents eight weeks' non-stop output of the cleaning and drying plant. (11) In valuing the subjects under appeal, the Assessor classified them as class 2 under the Rating (Scotland) Act, 1926, and subject to industrial derating under the Rating and Valuation (Apportionment) Act, 1928, and the Local Government (Scotland) Act, 1929, but he apportioned the silos as non-industrial. (12) The parties have consulted together regarding the annual value of the subjects and it was agreed between them that if the silos are correctly treated as non-industrial, then the values should be as follows:
Gross |
1110 |
|
Net |
1040, 12s.; |
Apportioned Indl.: 247, 10s. |
Non-Indl.: 793, 2s. |
||
Rateable |
855. |
It has further been agreed that if the silos should be treated as industrial, the annual value should be as follows:
Gross |
1110 |
Net |
1040, 12s. |
Rateable |
260, 5s. |
The Assessor submitted a plan showing the lay-out of the buildings under appeal. This is produced herewith and forms part of this case. The shorthand writer's notes of the proceedings as extended are available if required."
The contentions of the parties were stated as follows:
"The appellants maintained that the silos at Midcalder were incidental to their general manufacturing process and were not used for storage as an end and purpose in itself.
"The Assessor maintained that the silos were used for purposes other than industrial purposes, namely storage, and that the capacity of the storage was such that it could not reasonably be regarded as incidental to the industrial process carried on within the premises."
The decision of the Committee was stated as follows:"The Committee, having considered the arguments for the appellants and the Assessor, sustained the appeal and held by a majority that the whole subjects were entitled to industrial derating for the following reason:That the premises at Wallace Mills were not primarily occupied for the purposes of storage, but that such storage was a necessary and transitory incident to the manufacturing process being carried on by the appellants and that the appellants were accordingly entitled to industrial derating on the whole."
The case was heard before the Lands Valuation Appeal Court on 25th February 1959.
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