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“DE MINIMIS OCCUPATION” – MYTH OR REALITY?

AN ARTICLE by Peter Scrafton FIRRV, FCIArb, MRSA(Hon) Solicitor (Non-Practising)

October 2010.

I, for one, have long been accustomed to the argument, founded on the 1808 case of R –v- Aberystwyth Inhabitants [1808] 10 East 354 in which it was held that occupation of a part of a hereditament constituted, for rating purposes, occupation of the whole of it.  How many times have we heard that case successfully prayed in aid by Council officers before Magistrates’ Courts?  It was such well-settled law that resistance to collection summonses by ratepayers who were professionally advised, would generally collapse as soon as those advisers ascertained the facts of the case.

 

But all of this was before the advent of the 100% empty property rate, in 2008.  Now, many ratepayers seeking relief from that empty rate are either accused of tax evasion by cash-hungry DCLG’s debt collectors (the billing authorities) or they are assured that they are caught for liability by the principle of de minimis occupation.  This is a new one on me!  I have memories of Council advocates claiming that pairs of curtains left hanging in the windows of otherwise unoccupied houses; but it seems that leaving an articulated lorry in a warehouse is insufficient to constitute rateable occupation.  There is some inconsistency there, surely?

 

The expression de minimis is taken from the legal maxim De minimis non curat lex, meaning “The law does not concern itself with trivia”.  Rateable occupation, as we know, is a question of fact, and not a matter of law: I do not know whether any billing authority has addressed that point.  I am aware that the term is used in rating valuation; but I would consider it a slight misnomer, as small areas to be left out of a valuation might more properly be termed “valuation disregards”.

 

I have asked a couple of billing authorities what their authority for this concept is.  One has refused to discuss the matter, declaring that, once a liability order is obtained, there is no reason to discuss “…finer points of law”, even if for them to continue with recovery would result in an action for irregular or wrongful distress.

 

Another billing authority, when asked the same question, was honest enough to admit that it knew of no authority for the proposition, but added that it was confident that there would be authority for it, soon.  That sounds convincing enough to make any ratepayer cough up, without hesitation and with apologies (not)!

 

In fairness, the latter Council did later cite t) which it said supported its contention.  With respect, I think not.  Wirral is a collection case, dependent on its own facts, the Divisional Court not having power to disturb findings of fact made by magistrates.  That decision was as to whether or not the magistrates had before them evidence on which they could reasonably have arrived at the decision which they reached.  Further, the Divisional Court sat in the judicial hierarchy below the Court of Appeal; and although this Divisional Court was a strong one, it would seem that the case of Bexley Congregational Church Treasurer –v- Bexley London Borough Council [1972] 2 QB 222 (CA) was not cited to them.  Bexley was a decision of the Court of Appeal and was binding on the Divisional Court.  I will return to the Bexley case, later.

 

So what is the magic lozenge which can, perhaps, save the day for the ratepayer, in an appropriate case?  It is animus revertendi or the intention to return. 

 

This principle started, in medieval times, as a means of allowing farmers to recover their livestock which strayed on to the land of another.  It applies, also, as Blackstone tells us in his Commentaries (at 2 Bl Comm 391) to raptors kept for falconry: they may fly off in search of their quarry; but their training and habit is to return to their owner, and so, although they are by nature wild, nevertheless a raptor which flies off and gets lost or stuck can be reclaimed by its owner, although a pheasant, which by its nature is not so inclined, can be taken by another. 

 

Blackstone even enlists the support of Bracton, the highly-celebrated thirteenth-century jurist (1,2,c,1; 7 Rep.17.16).  I have also found a case on this point (on the ownership of racing pigeons shot by an angry neighbour whose peas they were eating!) in Hamps –v- Darby [1948]2 KB 311 (CA) in which my old principal triumphed for the plaintiff!

 

The principle was expanded, of course, into other, more familiar areas, over the centuries.  Treasure trove is one.  Have you ever wondered why the coroner holds an inquest?  It is to determine what the material is, who found it, how long it was buried and, most important, to determine whether or not the person who buried the treasure had the intention of returning to collect it. 

 

The difference is, of course, that if it was something like a box of gold and silver coins and jewellery, buried on the site of a lost village to prevent pillage by Saxons or Vikings, for example, then the treasure is treasure trove and, whether or not the Crown intervenes and takes it, the value belongs to the person who found it.  By contrast, there falls to be considered something like the Sutton Hoo Treasure, which consisted of grave goods, buried with a great chief, and nobody had any intention of returning to collect them.  In such latter case, the treasure belongs to the landowner.

 

Domicile is another use of animus revertendi.  If a person born and brought up in this country leaves for some sunshine and dies, a question arises as to their domicile – which governs the jurisdiction under which the deceased’s estate will be administered and distributed.  Was it their intention to return from the sunny country?  Or had they decided to settle and make their home there?  Was there a will?  Where was it made?  How should the estate be administered, any tax paid (and to whom) and how should the estate be divided?  So it may be another old latin tag; but it is still a very relevant principle. Disputes as to the continuance of statutory tenancies of dwellings where the tenants have moved out, have been quite frequent.  In order to preserve his tenancy, the absent tenant had to  prove animus revertendi in order to preserve his statutory rights.  There is a string of cases from the 1950’s onwards, in which the judges took a very lenient view of the comings and goings of tenants and what might be taken as sublettings (see New London Properties –v- Soni and Prais [1958] CLY 2926). 

 

That attitude changed in 1989, however, when the  Court of Appeal considered Thackray’s (Robert) Estates Ltd –v- Kaye [1989] E.G. 95 (CA), a case in which a protected tenant was moved out of her home to an adjoining house while “her” property was being renovated.  When the landlord’s works were completed, Mrs Kaye refused to move back in, claiming that the works which she thought  (and then insisted) were to be done, had not in fact been done.  The Court granted possession to the Landlord, holding that, for a tenant to establish an intention to return, there must be: “….. something more than a vague wish to return.  It must be a real hope couples with the practical possibility of its fulfilment within a reasonable time (per Ormrod LJ in Tickner –v- Hearn [1960] 1 WLR 1406).

 

While present-day Revenues and Benefits officers may not know about the concept, or be sceptical as to its existence, their nineteenth-century predecessors were certainly acutely aware of it, and as anxious as ever to husband their funds.  Relief for the poor was provided, then, by parishes individually from the parish rate, and so, when paupers who had come to a parish from elsewhere, in search of work, applied to their present parish for relief, it was quite common for that parish to refer them to their parish of origin, claiming that the paupers had the intention of returning home, and so their native parish should provide for them.  The point was litigated on a number of occasions (see, for example, R –v- Brooks [1830] 4 Car & P 131)

 

So animus revertendi was not just another redundant medieval concept, but a living principle which is with us today in a number of branches of the law – including rating.  And this is where the fun starts, because in the series of cases to which I will refer next (and these are all cited in Ryde) the rating authority was seeking desperately to prove that the person sought to be rated was rateable although not in actual occupation, because they had the animus revertendi!  Then, of course, there was no empty rate, so no actual occupier meant no rate income for the Council.  Hands up those who remember certain rating officers arguing before magistrates that the leaving of hanging curtains in an otherwise empty house constituted rateable occupation, and that occupation of part constituted occupation of the whole (Aberystwyth)?

 

Now, of course, since 2008, rate collectors are trying to turn this on its head, and argue that if nobody appears to have much of a presence on site, the de minimis principle of occupation applies, and the owner must therefore be liable for the 100% unoccupied rate. There is a long-established principle of reserved occupation; and while the principle that a mere intention to occupy is insufficient to establish occupation and some overt act is necessary (Associated Cinema Properties Ltd-v-Hampstead Borough Council [1944] KB 412) the ardent rate collector must still surmount the chain of cases starting with Staunton –v-Powell [1867] WR 362.

 

This case was a decision of the Court of Exchequer Chamber in Ireland (equivalent of Court of Appeal) on an Irish Statute which had the same meaning as the then current English statute.  The question was whether leaving furniture in a house rendered liability to the rate.

 

Christian J  held that the presence of the furniture has its chief bearing on the case with reference to the animus habitandi.  If a man leaves his furniture and sells his house, the presumption is that he has no intention of inhabiting it.  If he puts it on house-agents’ books, advertises it, &c., it may be he wants to make a profit by it.  If to make it more attractive he expends money in decorations, does he occupy it?  If not, will going one step further, and putting in furniture, make him liable?  That is the question intended to be raised.  If a man leaves furniture in a house, the presumption is in favour of the animus revertendi or habitandi.”

 

This is consistent with the decision in Aberystwyth and also with the decision of the Court of Appeal in Associated Cinema Properties.  It was also cited with approval in R – v- Melladew [1907]  1KB 192, a case in which an empty warehouse was held to be occupied by its warehousemen owners, on the ground that they had, indeed, temporary vacant possession, but that the whole intention of their business was to allow others to store their goods, there, and that there was therefore an intention to return, rendering the owners liable to the rate.

 

Add to that the case of Gage –v- Wren (1902) 87 LT 271,  and de minimis occupation is developing severe problems of credibility.  In that case, a seaside boarding house owner who emptied the house of furniture every winter failed to escape the rate on the ground that she had the intention to return, with his furniture, in the Spring.

 

Returning to the Bexley case I note that Leading Counsel for the (unsuccessful) rating authority (himself a former local government officer and a Council member of this Institute) argued (at p 225G et seq) that “actual” occupation did not necessarily require physical possession, and that the reserved occupation cases showed that past occupation plus an intention to reoccupy was sufficient to satisfy the requirement for actual occupation.  This argument satisfied the Divisional Court but not the Court of Appeal, which found for the ratepayer, on the basis of the specific provisions of paragraph 2(f) of Schedule 1 to the General Rate Act 1967, itself an early forerunner of the present provisions.

 

For my part, I take the view that the rating authority in Bexley was right.  The 2008 legislation does not alter the concept of rateable occupation, or purport to overturn centuries of judicial decisions and comment.  If, therefore, a contemporary billing authority wishes to argue that premises are unoccupied for the purpose of the 2008 legislation, it seems to me that it must develop its argument having regard to the body of judicial decisions: de minimis occupation, I believe, is one turkey which just will not fly!

 

©J.P. Scrafton, 2008

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