Ravenseft Properties Ltd v Newham London Borough Council
| Jurisdiction | England & Wales |
| Judge | THE MASTER OF THE ROLLS,LORD JUSTICE JAMES,LORD JUSTICE BRIDGE |
| Judgment Date | 14 October 1975 |
| Judgment citation (vLex) | [1975] EWCA Civ J1014-2 |
| Court | Court of Appeal (Civil Division) |
| Date | 14 October 1975 |
[1975] EWCA Civ J1014-2
In The Supreme Court of Judicature
Court of Appeal
Revised
The Master of the Rolls (Lord Denning)
Lord Justice James and
Lord Justice Bridge
Mr. CHARLES FAY (instructed by J.J. warren, Chief Executive, Town Hall, East Ham) appeared on behalf of the Appellant Defendants
The Honorable DAVID TRUSTRAM EVE, Q.C., and Mr. MICHAEL FITZGERALD (instructed by Messrs. Navarro Nathan's on & Co.) appeared on behalf of the Respondents, Ravines Properties Ltd.
In the East of London there is a fine new centre called The Stratford Centre which consists of two or three blocks of new air-conditioned offices. It has been developed by the London Borough of Newham in partnership with a property company called Ravines Properties Ltd. The office blocks are not occupied as yet, but the London Borough of Newham wish to charge Ravensoft Properties Ltd. with rates upon them. At one time unoccupied premises did not bear rates at all. "Void" or "empties", as they were called, were not liable to pay rates during the time they were unoccupied. But since 1967 there has been a provision in The General Rate Act whereby, in the case of office buildings, they are free of rates for the first 3 months whilst they are unoccupied; but after 3 months, they are liable to pay rates even if they are unoccupied. That is why the London Borough of Newham wishes to charge Ravines with rates. But - and here is the point in the case the chargeability only arises when the buildings are "completed". The controversy is whether these buildings were completed or not. The London Borough of Newham say that they are complete as soon as they are structurally complete; whereas Raven soft Properties say that they are only complete when they are ready for occupation. That is the broad issue between the parties.
The London Borough of Newham on 10th October 1974 served notices on Raven soft Properties in which they gave notice that they regarded the 14 floors as "completed": that the building was comprised in a "relevant hereditament"; and that it was to be regarded as completed in paragraph 8 of the First Schedule of the 1967 Act.
Ravensoft Properties took a contrary view. They appealed to the County Court, saying that their offices were not completed and could not reasonably be expected to be completed by that date.
This dispute depends on the state of the buildings. It has been agreed between the parties and we have photographs to show it.
A big block A has 14 storey of reinforced concrete construction. The whole of the structure, as a structure, is no doubt completed. There are large floors all the way up the 14 storey. On each of these floors at each end toilets are installed. Central heating and air-conditioned systems are installed. These vast floors have not been divided into rooms or offices. There are no partitions in. Each of the 12 floors covers a rectangular space of 8,385 esq. with nothing there except 10 structural columns in a line. There is a fuse box on each floor with wiring for a power circuit. But no points have been installed for any outlets.
There was no wiring for any lighting system. There was no telephone system. No G.P.O. cables had been installed. No main distribution frame had been installed. Application had been made for a telephone line in different places. But it was 9 months before the telephone can be installed.
The main contest is as to these 12 floors. As I say, they are enormous floors with columns down the middle but no divisions whatsoever into rooms or into individual offices. It seems to me that they could not be occupied or ready for occupation until they had been divided up by partitions and rooms and so forth.
So there we have the contest. The London Borough of Newham says they were complete because they were structurally complete. Ravines Properties say No, they are not complete until they are ready for occupation and they are not ready.
The County Court Judge held that they were not ready. He rejected the claim of the London Borough of Newham. Now there is an appeal to this Court.
We have been taken through this Schedule 1 of the 1967 Act dealing with the rating of unoccupied property. We have been taken to the distinction between a newly erected building, on the one hand, and, on the other hand, a building which has already been used but has been structurally, altered so as to become anotherhereditament. It does seem to me that the same test ought to be applied in each. I do not propose to analyze that Schedule in detail. I am only going to take two oases which have come before the Courts. The first is the case where there was a newly erected building. This was a case of Watford Borough Council v. Par court Property Investment Co. Ltd, 1971 Hating Appeals 97. That was a case where the Heinz company (the well-known company which makes baked beans among its 57 varieties) was building a large office building in Watford. It was a newly erected building. Much of the building was erected; but Heinz (when they took over the building) did a lot of work themselves. When they took it over it was devoid of any internal partitioning at all. There were big floors rather like the present case. It was held by Mr. Justice Bridge, as he then was, that this was not a completed building. Both sides there had agreed that the appropriate test was, whether or not it was ready for occupation. Mr. Justice Bridge held, that it was an incomplete building and therefore they were not liable to be rated in regard to it at all. If I may say so, that commends itself to me as being a proper application of the word "completed" in this context.
The other case is on the other branch of the argument where there is an existing building which has been structurally altered so as to become a different building. This was a case of Casework Homes v. Red bridge 1970 2 Q.B. 406. The position there was that there was an old fashioned block of 16 flats in Wan stead. The company decided to modernize the whole block of flats. The plumbing work had been removed. Toilet fittings were being replaced. Electric wirings were being renewed and even in some cases flooring was being re-laid. In that case there was an existing building, the old hereditament. The old valuation list, unless it was altered, continued to apply. It continued to applyto the building until there was a new hereditament constructed: and so constructed as to be complete in that sense, as ready for occupation. In that case the new modernized flats were not ready for occupation. They were incomplete. So the old valuation list and the old rating applied. So it was held by the Divisional Court in that case. The Court said that it would be very odd if a person could avoid paying rates simply by making a few removals of the sanitary fittings, part of the plumbing, and so forth.
Those two oases were, I think, correctly decided. They illustrate the problem which arises under this Schedule in respect of the two aspects: first, the newly erected building, and, secondly, the old building which has been structurally altered.
Now to come to the wording of the section, the important paragraph here is paragraph 8(1) of Schedule 1, which says:
"Where a rating authority is of opinion -
(a) that the erection of a building within their area has been completed; or
(b) that the work remaining to be done on a building within their area is such that the erection of the building can reasonably be expected to be completed within three months, and that the building is, or when completed will be, comprised in a relevant hereditament, the authority may serve on the owner of the building a notice (hereafter in this paragraph referred to as 'a complete notice') stating that the erection of the building is to be treated for the purposes of this Schedule as completed on the date of service of the notice or on such later date as may be specified by the notice."
It seems to me that the Schedule uses the word "completed" there as something different from "structural alterations" In paragraphs 10 and 15, and from the words "substantially completed" in paragraph 9; and I am impressed by the reference to paragraph6 which we were referred to. The word "completed" in paragraph 8(1) seems to me to mean completed in the sense of being ready for occupation.
The test in this case is that the building should be ready for occupation. Once it is completely ready for occupation, there is a free period of 3 months during which rates are not payable, but after three months rates are payable. That applies not only to a new building but it applies if there is an alteration to an old building.
The only remaining point is what is to be done. The Judge allowed the appeal. That was all that he had to do, because the notice was not properly given: the building was not complete. But there is a provision in paragraph 8(5) which says that if the appeal is in fact allowed "the erection of the building shall be treated for those purposes as completed on such date as the Court shall determine". It seems to me plain that the Court cannot apply that provision unless there is evidence on the matter and unless it is asked to do so; and I should have thought there ought to be evidence to show when it was completed so that the Court could determine it. If it had the evidence it could determine the date on which it was completed. But in the present case, where there was no evidence given us and no application until after judgment, it seems to me that provision does not come into operation.
We had considerable discussion as to the telephone cables and...
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