Gallagher (Valuation Officer) v Church of Jesus Christ of Latter-Day Saints

The House of Lords held that the Temple and most ancillary buildings on the Chorley site were not exempt from non-domestic rating under paragraph 11 of Schedule 5 to the Local Government Finance Act 1988. The court treated the phrase "place of public religious worship" as requiring that worship be open to the public, following the House's earlier decision in Church of Jesus Christ of Latter-Day Saints v Henning [1964] AC 420. The Temple was therefore not exempt under paragraph 11(1)(a), and it was not a church hall or similar building "used in connection with" the Stake Centre within paragraph 11(1)(b) because its use was independent and not ancillary. The other buildings (Missionary Training Centre, Patrons' Services Building, Grounds Building, Patrons' Accommodation) did not satisfy paragraph 11(2)(a) or (b) because their uses were not sufficiently connected to the organisation of public worship in the Stake Centre nor were definable apportionable office uses. The Human Rights Act 1998 and Convention arguments (articles 9 and 14 and article 1 of Protocol 1) did not require a different construction: any indirect discrimination was either not within the ambit of article 9 or was justified as within Parliament's margin of appreciation.

This appeal concerned the rating treatment of a group of buildings owned by the Church of Jesus Christ of Latter-Day Saints in Chorley, notably a large Temple and a nearby Stake Centre. The Valuation Officer accepted that the Stake Centre (which contains a chapel and hall open to public worship) was exempt under paragraph 11(1)(a) or (b) of Schedule 5 to the Local Government Finance Act 1988, but assessed the Temple and other buildings as rateable.

The issues before the House were (i) whether the Temple was a "place of public religious worship" within paragraph 11(1)(a), (ii) alternatively whether it was a "church hall, chapel hall or similar building used in connection with" the Stake Centre under paragraph 11(1)(b), (iii) whether several other buildings on the site were exempt under paragraph 11(2)(a) or (b) as occupied for administrative or office purposes relating to public worship in the Stake Centre, and (iv) whether the Human Rights Act 1998 required a Convention-compatible construction to avoid religious discrimination.

The court accepted the factual finding that access to the Temple is restricted to members with a recommend and that many of the other buildings served functions connected to the Temple rather than to the Stake Centre. On statutory interpretation it followed the precedent in Henning [1964] AC 420 and related authorities, concluding that "public religious worship" carries the historical meaning of worship open to the public. "Used in connection with" implies an ancillary or subsidiary relationship; the Temple was not ancillary to the Stake Centre. Paragraph 11(2)(a) requires activities to relate to the organisation of the conduct of public worship in the relevant place; the Missionary Training Centre and other buildings were not shown to satisfy that nexus, and no apportionable office use was shown to fit paragraph 11(2)(b).

On human rights arguments the House held that the statutory scheme did not amount to unlawful discrimination: either the complaint did not fall within the ambit of article 9, or any differential treatment was justified within Parliament's margin of appreciation (and section 3 of the Human Rights Act did not require re-reading the 1988 Act so as to extend exemption).

Procedural path: the Lands Tribunal had allowed exemption only for the Stake Centre; the Court of Appeal ([2006] EWCA Civ 1598) upheld that approach; the House of Lords dismissed the appeal and affirmed that the Temple and the other buildings (other than flats subject to council tax) were not exempt.

Appeal dismissed. The House of Lords held that "place of public religious worship" in paragraph 11(1)(a) of Schedule 5 to the Local Government Finance Act 1988 requires worship to be open to the public, and the Temple (access restricted to patrons with a recommend) did not satisfy that test. The Temple was also not a church hall or similar building "used in connection with" the Stake Centre under paragraph 11(1)(b) because its use was independent and not ancillary. The other buildings failed to meet paragraph 11(2)(a) or (b) since their uses were not sufficiently connected to the organisation of public worship in the Stake Centre nor were apportionable office uses. Human rights arguments under the Human Rights Act 1998 did not require the statute to be read down or differently interpreted.

Lands Tribunal (President Bartlett QC): held the Stake Centre exempt but most other buildings not exempt; Court of Appeal [2006] EWCA Civ 1598 (Neuberger LJ and others): upheld the Lands Tribunal on the principal issues; House of Lords [2008] UKHL 56: appeal dismissed.