Rudd (Valuation Officer) v Cinderella Rockerfellas Ltd (Tuxedo Royale)
| Jurisdiction | England & Wales |
| Judge | Lord Justice Potter,Lord Justice Chadwick,Lord Justice Tuckey |
| Judgment Date | 11 April 2003 |
| Neutral Citation | [2003] EWCA Civ 529 |
| Docket Number | Case No: C1/2002/1446 |
| Court | Court of Appeal (Civil Division) |
| Date | 11 April 2003 |
[2003] EWCA Civ 529
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE LANDS TRIBUNAL
(GEORGE BARTLETT QC, PRESIDENT)
Lord Justice Potter
Lord Justice Chadwick and
Lord Justice Tuckey
Case No: C1/2002/1446
Mr David Widdicombe QC and Mr Robert Walton (instructed by Messrs Richmonds) for the Appellant
Mr T Mould (instructed by the Solicitor of Inland Revenue) for the Respondent
Introduction
This is an appeal by Cinderella Rockerfellas Ltd (the appellants) the operators and occupiers of a nightclub situated upon a floating vessel, the Tuxedo Royale ("the vessel") which at all material times was moored and berthed on the river Tyne at Hillgate Quay, Gateshead. They appeal against the decision of the Lands Tribunal (George Bartlett QC, President) dated 13 June 2002 whereby the Lands Tribunal allowed two consolidated appeals by the Valuation Officer against decisions of the Tyne & Wear Valuation Tribunal. The latter Tribunal had, on appeals by the appellants, directed that two entries:
"River and riverbed occupied by floating nightclub moorings car park and premises"
and
"Tuxedo Royale, Hillgate Quay, Gateshead, Tyne & Wear"
should be deleted on the ground that the vessel was not rateable.
The appeal thus raises the question of the rateability of floating vessels in the English law of rating and, incidentally, whether it diverges from Scottish law.
The facts
The material facts as agreed between the parties before the Lands Tribunal were as follows. I have indicated in square brackets certain additional matters not mentioned in the agreed facts but which were not in dispute on the appeal.
The vessel was built in 196It is 350 feet long, 54 feet in the beam and has a gross registered tonnage of 5888. Then known as Sol Express, it operated as a passenger and drive-on vehicle ferry until 1988 when it was modified for its present use and re-named. It was moored at Hillgate Quay from 1989 to 1999 under licence granted to the appellants by the Crown Estate Commissioners. The first licence, dated 26 January 1990, granted for a period of five years from 26 November 1988 the right to place and maintain on and over the foreshore and bed of the river Tyne adjoining Hillgate Quay, in the position indicated on the plan and annexed licence, the vessel or such replacement vessel as might be approved by the licensor. [The plan attached showed the vessel in position in the river beside the quay within a rectangular marked area closely drawn around the vessel indicating the extent of the foreshore and riverbed licensed.] By Clause 2(11) the vessel was not to be used for any purpose "… save as an entertainment complex comprising restaurants, bars and disco function rooms exhibitions and like users." Clause 3(4) stipulated:
"Nothing herein is to be construed as conferring on the Licensee the right to the exclusive use of any part of the said foreshore or bed of the river Tyne and the Commissioners shall be at liberty to grant such interest rights and easements in or over the same as the Commissioners shall think fit provided only that the placing and maintenance of the Vessel in accordance with this Licence is not thereby prevented."
Thereafter there was no interference by the Licensor with the appellants' use of the parts of the foreshore or bed of the river to which the licence related and the Commissioners granted no additional rights during the term of the 1990 licence. By licence dated 23 November 1994 the Commissioners granted rights to the respondents in similar terms to those in the 1990 licence save that clause 3(4) was omitted. The vessel was used in compliance with clause 2(11) throughout the period of both licences.
The 1.52 acres of land which contained the Hillgate Quay frontage on its northern boundary was the subject of a lease for 10 years from 26 November 1983 originally made between Gateshead Borough Council and a company called Riverzest Ltd, which became vested in the appellants. The lease included the right to use the frontage for the purpose of berthing a vessel previously known as the SS Caledonian Princess or any other vessel in the appellant's ownership which the Council might authorise in writing as an alternative to the named vessel. There was a prohibition against using the quay structure for any other purposes and a requirement that the vessel should be used as a restaurant, licensed premises, hotel, disco and conference centre. Clause 3(g) required the lessee to use the surface of the quay area for the parking of customers' private vehicles in properly marked out parking areas.
By a lease dated 21 November 1994 Gateshead Borough Council granted the appellants a further 12 year term from 26 November 1993 upon terms not materially different from those in the 1984 lease. Again, at all material times, the quay structure, vessel and quay areas were used within the purposes provided by the leases.
The vessel was moved to the quay and held in position over the riverbed by means of ropes and chains secured to capstans on the quayside. It was subject to tidal movement. It remained secured at its berth from 1989 to 1999, only being moved from its position once for the purpose of demonstrating that it could be moved away from its mooring. On that occasion it was moved by being towed by tugs. In 1999 it was moved to the river Tees for similar use, before being replaced at Gateshead by a similar vessel.
The main accommodation on the vessel consisted of bars, offices, a restaurant, a café/diner and adjoining discotheque, a main discotheque holding up to 700 people, a kitchen, toilets, two private function suites, storage areas and a cellar on the lower deck. Access to the vessel was by means of four metal gangways on the quay. [The gangways were strongly constructed of steel, totally enclosed and capable of moving on the quay side as the vessel rose and fell with the tide.] The car park was used as a private car park for the purposes of the appellant's business use of the vessel. The vessel generated its own electricity and there was no mains connection. It was not connected to a public sewer, but instead had tanks that were emptied and serviced by a private contractor. There was a water supply to the quay and from there to the vessel by means of a hose. There was a telephone connection.
The vessel had a full justices' on-licence and an entertainment licence granted by the local authority. It was registered in the Registry of British Ships. Permission to moor it at Hillgate Quay was granted by the Port of Tyne Authority, subject to requirements relating to lighting, the need for a competent ship keeper on constant duty and other matters.
The Decision of the Lands Tribunal
The Lands Tribunal resolved the issue whether the vessel was rateable by applying the principle stated by Lord Denning MR in Field Place Caravan Park Ltd v Harding [1966] 2 QB 484 in which, basing himself upon London County Council v Wilkins (Valuation Officer) [1957] AC 362, Lord Denning stated:
"The correct proposition today is that, although a chattel is not a rateable hereditament by itself, nevertheless it may become rateable together with land, if it is placed on a piece of land and enjoyed with it in such circumstances and with such a degree of permanence so that the chattel with the land can together be regarded as one unit of occupation."
Applying that principle, the Lands Tribunal held that the vessel was rateable for the reasons set out at paragraph 21 of its decision:
"The fact that the Tuxedo Royale is a vessel is no bar to rateability. In the normal way, a vessel, as a mobile chattel, is not rateable. As the Sol Express, the whole function of the vessel lay in its mobility, its ability to move and to transport passengers and vehicles. Moored under the Tyne Bridge, on the other hand, it was the immobility of the Tuxedo Royale that enabled it to perform its new role as a nightclub. The fact that it had been designed to propel itself across the sea and to transport passengers and goods ceased to have any significance other than to add to its attractiveness in its new and wholly different role. Its moorings were intended to ensure that the vessel stayed in position, eliminating all movement except for the small amount that would inevitably arise from the tidal nature of the river. The occupation by the ratepayers of the vessel, the riverbed and quay had the same characteristics in terms of permanence and exclusiveness as in the case of a nightclub contained in a building on dry land. The vessel, is, in my judgment, undoubtedly rateable."
In coming to its decision, the Lands Tribunal referred to its own previous decision in Felgate (VO) v Lotus Leisure Enterprises Ltd [2000] RA 89 and observed that the vessel was rateable for the same reasons that a vessel called the Lotus was rateable in that case.
The Relevant Law
The unit of property which is the subject of rating is "the hereditament". By s.64(1) of the Local Government Finance Act 1988 ["the 1988 Act"]:
"A hereditament is anything which, by virtue of the definition of hereditament in section 115(1) of the [General Rate Act 1967], would have been a hereditament for the purposes of that Act had this Act not been passed."
S.115(1) of the General Rate Act 1967 provided that:
"'Hereditament' means property which is or may become liable to a rate, being a unit of such property which is, or would fall to be, shown as a separate item in the...
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