Decision Nº RA 4 2006. Upper Tribunal (Lands Chamber), 25-09-2009
| Jurisdiction | UK Non-devolved |
| Judge | George Bartlett QC PresidentMr Andrew J Trott FRICS |
| Date | 25 September 2009 |
| Court | Upper Tribunal (Lands Chamber) |
| Judgement Number | RA 4 2006 |
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`UPPER TRIBUNAL (LANDS CHAMBER) |
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UT Neutral citation number: [2009] UKUT 187 (LC)
LT Case Number: RA/4/2006
RA/7/2006
TRIBUNALS, COURTS AND ENFORCEMENT ACT 2007
RATING – valuation – National Sports Centre – contractor’s test – stage 5 allowance – improvement of facilities with £10m lottery grant – whether deduction to be made for grant – held no allowance to be made – site liable to flood – allowance for this – VO’s appeal allowed in substantial part – ratepayer’s cross-appeal dismissed
IN THE MATTER OF AN APPEAL AGAINST THE DECISION OF THE
BERKSHIRE VALUATION TRIBUNAL
(Valuation Officer)
SPORTS COUNCIL TRUST COMPANY
Re: National Sports Centre Bisham Abbey,
Bisham Village,
Bisham, Marlow,
Buckinghamshire SL7 1RT
Before: The President and Mr A J Trott FRICS
Sitting at 43-45 Bedford Square, London WC1B 3AS
on 15, 16 and 17 June 2009
Timothy Morshead, instructed by HM Revenue & Customs Solicitor’s Office, for the appellant
Melanie McIntosh, instructed by Wilks Head & Eve LLP, chartered surveyors, for the respondent
The following cases are referred to in this decision:
Assessment Committee v Roberts [1922] AC 93
Orange PCS Ltd v Bradford (VO) [2004] RA 61
Metropolitan Water Board v Chertsey Union Assessment Committee [1916] 1 AC
Lavery (VO) v Leeds City Council [2002] RA 165
Willacre Ltd v Bond (VO) [1987] RA 199
Monsanto Plc v Farris (VO) [1998] RA 107
Leicester City Council v Nuffield Nursing Homes Trust [1979] RA 299
Cardiff Corporation v Williams (Valuation Officer) [1973] RA 46
Imperial College of Science and Technology v Ebdon (VO) [1986] RA 233
Hoare (VO) v National Trust [1998] RA 391
Dawkins (VO) v Royal Leamington Spa Corpn (1961) 8 RRC 241
Scottish Exhibition Centre Ltd v Strathclyde Region Assessor [1994] RA 209
Distillers Company (Bottling Services) Ltd v Fife Assessor [1983] RA 228
The following cases were also referred to in argument:
Ratford v Northavon District Council [1987] 1 QB 357
Robinson Brothers (Brewers) Limited v Assessment Committee for the No7 or Houghton and Chester-Le-Street area of the County of Durham [1937] 2 KB 445
Solihull Corpn v Gas Council [1961] 1 All ER 542
London County Council v Erith Parish (Churchwardens) and Dartford Union Assessment [1893] AC 562
Plymouth City Council v Hoare (VO) [1995] RA 69
Eastbourne Borough Council and Wealden District Council v Allen (VO) [2001] RA 273
Imperial Chemical Industries plc v Central Region Assessor [1989] RA 333
Railway Assessment Authority v Southern Rly Co Ltd [1936] AC 266
R v London School Board (1886) 17 QBD 738
Westminster City Council v Southern Rly Co Ltd [1936] AC 511
East Midlands Airport Joint Committee v Coppin (1971) 17 RRC 31
IRC v Gray [1994] STC 360
Co-operative Wholesale Society Ltd v National Westminster Bank plc [1995] 1 EGLR 97
Williams (VO) v Scottish & Newcastle Retail Ltd [2001] RA 41
Chiltern-Merryweather v Hunt [2008] RA 357
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These appeals (by the valuation officer and the ratepayer respectively) concern the valuation for rating purposes of a hereditament known as the National Sports Centre at Bisham Abbey in Buckinghamshire. It is one of six national sports centres, the purpose of which is to provide facilities for elite athletes. Provision is also made for the use of the facilities by the wider community. It is common ground that the assessment should be on the contractor’s basis. Prior to the works that have given rise to the present appeal the rateable value of the hereditament in the 2000 rating list was £360,000. The devaluation of this figure on the contractor’s basis is now agreed.
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In January 2004 works to build a new sports centre, replacing a smaller building, which was demolished, were completed. A new physiotherapy unit had been completed during 2003. Replacement tennis courts were built and other external works were carried out. The cost of the works was £10,222,416, and of this amount all but £622,716 (93.9%) was provided from an award of grant from lottery funds. On 4 June 2004 the valuation officer altered the list with effect from 1 April 2004 to £501,500 to reflect the increased value given to the hereditament by the works. The adjusted cost of the works as at the antecedent valuation date, and allowing for non-rateable items, is now agreed at £3,333,724 plus professional fees. Apart from any deduction to be made at stage 5 of the valuation it is agreed that the rateable value after stages 1 to 4 on the contractor’s basis is £480,000.
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The VO contends that no deduction at stage 5 is appropriate and that the assessment should therefore be £480,000. The ratepayer’s contention is that adjustments need to be made to reflect the extent to which the new works were grant-funded and also the risk of flooding from the river Thames, which borders the site. Their valuer, Mr Roger Messenger, deducts 93.9% of the agreed adjusted cost of the works from the amount to be decapitalised at 5.5% to reflect the grant-funding, with a further deduction of £48,000 (10% of the agreed value at the end of stage 4) for the flood risk. This produces a value of £242,650 (some £117,350 less, therefore, than the rateable value of the hereditament before the works were carried out). The Berkshire Valuation Tribunal determined a rateable value of £410,000, and it is against this decision that both parties appeal.
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There is an agreed statement of facts, the substance of which we will set out.
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The relevant sport bodies to which reference is made are the English Sports Council (ESC), which has the brand name Sport England (SE); the Great Britain Sports Council (GBSC); the United Kingdom Sports Council (UKSC); Leisure Connections plc; and The Sports Council Trust Company Limited (SCTC). The ESC was established by Royal Charter on 19 September 1996 as one of two successor bodies to the GBSC (the other successor body being the UKSC). The GBSC was named under the provisions of the National Lottery Act 1993 as the Distributing Body for the lottery funds allocated for expenditure on or in connection with sport in England. That duty was transferred to the ESC upon its creation in October 1996 as the successor body to the GBSC as the lottery distributor for sport in England. The vast majority of ESC lottery funding is to local authorities and community sports organisations for the purpose of developing community sports. In addition ESC operates five National Sports Centres (including Bisham). These are currently managed by Leisure Connections plc as appointed contractors.
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The ESC is principally funded by exchequer grant-in-aid paid by the Department for Culture and Media and Sport, under Funding Agreements. The land and buildings operating leases relating to the ESC are held in the name of the SCTC, but are paid for by the ESC. The annual commitments under these leases are therefore treated as those of the ESC.
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The SCTC is a wholly owned subsidiary of the ESC and was incorporated on 27 June 1990 as a company limited by guarantee. The guarantor is the ESC. The ESC makes all nominations to the board for the appointment of chairman, directors and company secretary. The chairman of SCTC is appointed by the ESC. The chairman has authority for operational matters including finance. Currently the chairman has delegated these to the financial accountant of the ESC. The service level agreement between the ESC and the SCTC, which is renewed annually, sets out the arrangements between the two organisations. The SCTC is a registered charity. It employs no staff.
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The main activity of the SCTC is the acquisition and maintenance of tangible fixed assets and facilities for physical recreation operated by SE, as SCTC’s agent, for use by the public. It holds the freehold of SE’s National Centres, including the...
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