Sunderland City Council v Stirling Investment Properties LLP

For non-domestic rating, slight physical use can amount to rateable occupation where the occupier has actual, exclusive and beneficial possession for a non-transient period. The extent of use is assessed in context, including the nature of the occupier’s business and intended use. The de minimis principle remains relevant, but use need not be substantial.

Occupation is not excluded merely because the occupier uses premises for a purpose different from the rating-list description. Any resulting issue about the identity or description of the hereditament is ordinarily for the valuation officer and the statutory valuation-appeal process.

Sunderland City Council appealed by way of case stated from District Judge Elsey’s dismissal of a complaint seeking a liability order for unpaid non-domestic rates. The respondent owned an industrial warehouse which had been vacant. It granted Complete Mobile Marketing Ltd a 43-day lease to place and operate a small Bluetooth server for marketing and advertising.

The apparatus occupied only a tiny part of the warehouse, which was described in the rating list as a warehouse and premises. The central questions were whether the apparatus constituted occupation of the hereditament and whether that occupation was rateable despite being for advertising rather than warehousing.

1. Appeal dismissed. The District Judge had not erred in law in finding that the Bluetooth apparatus constituted occupation and rateable occupation of the hereditament.
2. Rateable occupation requires actual occupation, exclusive possession for the particular purposes of the possessor, possession of value or benefit, and possession that is not too transient. The relevant principles were stated in John Laing and Sons Ltd v Assessment Committee for Kingswood Assessment Area [1949] 1 KB 344.
3. The de minimis principle may be applied when deciding whether the extent of use is sufficient. It does not impose a requirement of substantial use. The District Judge was entitled to find that the respondent’s intended and actual use, although confined to a minute fraction of the premises, crossed that threshold.
4. Use for advertising rather than warehousing did not prevent rateable occupation. The statutory scheme did not require occupation to correspond with the rating-list description. Any issue concerning a new or additional hereditament, or alteration of the list, was for the valuation officer and the statutory appeal process.
5. The occupation was exclusive, intended, beneficial and sufficiently lasting. The respondent therefore obtained the relevant six-week occupation for the purposes of regulations 4(b) and 5 of the Non-Domestic Rating (Unoccupied Property) Regulations 2008, with the consequence that no liability for unoccupied rates arose for the succeeding six-month period.

The appeal was brought by way of case stated from the decision of District Judge Elsey in Sunderland Magistrates’ Court dated 2 April 2012. The High Court dismissed the appeal.