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

April 2013.

The time has come to wrap up this miniseries; and, while I do not claim any credit for having influenced thinking in any particular way, I notice a heightened interest in seeking answers. This means litigation, of course, in which I acknowledge a professional interest; but as no individual will be involved, usually, in more than a few cases on any particular issue, it indicates to me that people are having the courage of their convictions, and fighting for what they believe to be right. This is equally true of all parties.

Of course, there are those who bully, and those who give in, as well as those who come up with some less-than-convincing arguments, like this one from a recent magistrates’ court Council Tax hearing which I witnessed. The billing authority’s advocate demanded a liability order; but when pressed to give a reason for this, could reply only that he must have one and had to have it: there was nothing about Reg 34(6) of the Collection and Enforcement Regulations, as to the sum claimed becoming due and payable and remaining unpaid. There were other omissions, too. He did not get his order, I might say. As far as the bullying is concerned, there was the authority which, very recently, tried to claim that the ratepayer was under a duty to inform the Council of changes in occupation (which they were not!), going on to say, somewhat forcefully, that, for this reason, the abatement sought would not be granted and it served the ratepayer jolly well right.

I cast aspersions at neither individuals nor professions; but it behoves us all to ensure that whoever is preparing a case and advocating it, shall have appropriate professional training in the right field, and an equally appropriate level of experience. Knowing what the current law actually is, and applying it to the facts before the decisionmaker are absolutely vital. As in tennis, so in litigation, the ball is under your own full control, only when you are serving. If it is not an “ace”, then it can come sizzling back, from and in an unlooked-for direction, which can prove to be both embarrassing and expensive. I have known some very inadequate lawyers, and some highly-skilled non-lawyer local authority and valuer advocates.

The techniques of advocacy may be for a later piece, but the first requirement is surely to ascertain the facts as fully as you can before launching proceedings, and to apply the existing law to those facts. If the true answer to your own question is that what the potential opponent has done is within the law, then don’t fight him. If it is equally clear that the other side are wrong, then you should go for it. Should the answer fall in a grey area, then such is the time for consultation and the taking of advice from someone else before a decision is taken as to whether or not, and if so in what way, to pursue the matter in hand.

Making bland assumptions can backfire, badly.

In Re the Appeal of Woolway (VO) [2012]RA 203 LC the then President of the Lands Chamber, George Bartlett QC, said:-

“…To treat as a single hereditament floors next to each other that are in the same occupation but as separate hereditaments floors in the same occupation that do not adjoin each other does not, in my view, properly reflect the realities of occupation in a modern office block. The proper approach in a case such as this, therefore, in my judgment is to treat the floors occupied within the building by the same occupier as a single hereditament.” (This decision has been appealed to the Court of Appeal – JPS)

And, in Imperial Tobacco Group Ltd –v- Alexander (VO) [2012] RA 218 VTE the President, Graham Zellick QC said:-

“22. Regulation 6 [of the Non-Domestic Rating (Alteration of Lists and Appeals) Regulations 2009 (SI 2009 no 2268)] sets out the information that must be contained in a proposal and reg 8 deals with disputes as to a proposal’s validity, but nowhere is invalidity defined. The valuation officer takes the view that any error or omission – any failure to comply with the requirements of reg 6 – leads to invalidity, but no regulation says that in so many words. It is a plausible inference to draw, though draconian. It would introduce into rating appeals a degree of formalism almost medieval in character and would, in my opinion, be inimical to the interests of justice”

Everybody gets things wrong, sometimes, of course; and nobody can be criticised for making a fine judgment on a point which ought to be tested, but who eventually comes out on the losing side: however, rushing in and making an assumption, usually in the hope of a particular financial result, can set an adverse precedent, or can cause considerable expense to seek to overturn, and sometimes no little embarrassment, to boot.

It is, perhaps, also a good idea to ponder awhile on judicial authorities, not least of all recent ones, to consider whether they really do say to us what we hope they say. I appreciate that to refer to charitable relief from the rates might be reminiscent of the obsession of the unfortunate Mr Dick in Dickens’ “David Copperfield” with the severed head of King Charles I, but the case of Kenya Aid Programme –v- Sheffield City Council [2013] EWHC 54 (Admin) makes my point very well.

The case has already been discussed in the April edition of Insight, and views expressed on it. I will not comment, one way or the other, on the views already expressed; but it has to be said that Makro, which deals with some of the same issues, was not cited to the Divisional Court which heard Kenya, and that what Treacy LJ had to say is (as are many observations by judges) needful of interpretation, in context. Failure to cite a case which deals with the same, or similar issues, can detract from the force of a case relied upon; and Makro in effect disapproves English Speaking Union, while it also has some very firm things to say about whether or not the principles of tax avoidance have any relevance in the world of rating (a point also dealt with in the first part of this series).

Having made those points, the parties in Kenya were clearly right to take the matter to the Divisional Court, which (and here I find fault with the antiquated procedure by way of case stated) felt that it did not have enough material to come to a definitive conclusion on some of the matters raised. Doubtless, the case will return to the Divisional Court, and it may be adjudged sufficiently important (and financially worthwhile) to go on to the Court of Appeal.

I do not seek to encourage litigation: I am an accredited mediator as well as a qualified lawyer; and most cases can be resolved without the need or going to trial. There are, though, cases which arise from time to time when the parties simply do not know what the right answer is, and then the only thing to do is for the parties to lay their arguments before a court or tribunal, and have them decide what the “right answer” actually is.

This is how we all ought to take our law, though – slowly, carefully and determinedly, if somewhat painfully, on occasion. We must remember, though, that when Parliament acts, particularly in a “kneejerk” fashion, as it did with the introduction of the present empty rate regime in 2007, the public must be expected to test the limits of such legislation, while nonetheless complying with it. The public will not pay a penny more than they must in taxation, they do not have bottomless pockets and the economic climate remains grim.

Some of the charitable relief approaches are, in principle, and usually in practice, undoubtedly within the present law, such as food banks and those which occupy premises and use them to give away recycled items. Where activities (or the lack of them) give rise to concern, then billing authorities are right to ask reasonable questions, which an applicant must answer. The Charity Commission is also coming in to ask questions in a number of cases.

Many cases where charities are not involved, but short term voids are sought, are also perfectly legitimate. Some others may be questionable. Doubts have been expressed over the use of what I will call pre-planned corporate insolvencies; and this approach is apparently under investigation.

We have also, of course, the “Bluetooth” case, which is sub judice and upon which, therefore, I will not comment, save to say that the case is another illustration of the way in which we should all expect to take our law – as given by Parliament and interpreted by the Courts.

I await the answer to Kenya and to “Bluetooth”, with no little interest.

Peter Scrafton

©J.P. Scrafton, 2013

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