Hardy v Sefton Metropolitan Borough Council

Under Class C of the Council Tax (Liability for Owners) Regulations 1992, as amended, the alternative requirements in subparagraphs (a) and (b) are disjunctive. Where subparagraph (b) applies, it is irrelevant whether the occupiers constitute a single household or whether the dwelling was constructed or adapted for occupation by persons who do not constitute one. The tribunal’s jurisdiction under section 16 of the Local Government Finance Act 1992 is confined to determining chargeability, liability and the correctness of a calculation. It has no general equitable jurisdiction to investigate alleged breaches of the billing authority’s duties concerning demand notices or to alter liability on that basis. Questions about whether such a breach legally precludes recovery belong to the Magistrates’ Court in liability-order proceedings.

The appellant owned a flat occupied by three people under separate room tenancies. Sefton Metropolitan Borough Council treated the dwelling as falling within Class C(b)(i) of the Council Tax (Liability for Owners) Regulations 1992, making the owner liable for council tax. The Merseyside Valuation Tribunal upheld that decision.

On appeal, the appellant argued that the occupiers formed a single household and that the council had failed to serve a demand notice within the period required by regulation 19 of the Council Tax (Administration and Enforcement) Regulations 1992. The council challenged the tribunal’s jurisdiction to determine the latter issue. The central questions were the construction of Class C(b)(i) and the scope of the tribunal’s appellate jurisdiction.

1. Extension and amendment. The court granted the extension of time and permission to amend the appellant’s notice to raise the demand-notice issue. The respondent was permitted to argue jurisdiction because jurisdiction cannot generally be acquired by concession.
2. Single household issue. Class C originally required that the inhabitants did not constitute a single household. The 1993 amendment retained that requirement in modified form. The 1995 substitution of “or” for “and” made the two limbs disjunctive. Consequently, where Class C(b) is satisfied, any question whether the occupiers constituted a single household is irrelevant. The tribunal was entitled to rely on the separate room tenancies and housing-benefit material as establishing that each occupier was a tenant of part only of the dwelling. The authorities concerning the general concept of a single household did not assist.
3. Demand notice and jurisdiction. The tribunal’s jurisdiction under section 16 of the Local Government Finance Act 1992 is the narrow jurisdiction of deciding whether the dwelling is chargeable, whether the person is liable, and whether the council’s calculation is accurate. The legislation and regulations contain no basis for a wider jurisdiction to investigate breach of regulations 18 or 19 or to depart from the liability otherwise established on equitable grounds.
4. The court distinguished the Magistrates’ Court’s position under regulation 34(6), which requires inquiry into whether the sum has become payable and permits legal obstacles to recovery to be considered. That jurisdiction does not extend to the valuation tribunal. A broad tribunal jurisdiction would also undermine the allocation of issues reflected in regulation 57.
5. The appeal was dismissed. The demand-notice argument failed because the tribunal had no jurisdiction to determine it.

High Court (Administrative Court): The appellant appealed from the decision of the Merseyside Valuation Tribunal dated 10 January 2005. The High Court granted an extension of time and permission to amend, rejected the substantive arguments, and dismissed the appeal.