Pengelly v The Listing Officer

A statutory appeal from a valuation tribunal is confined to points of law and is not a rehearing on the merits. The court may intervene where the tribunal applies the wrong legal principles, asks the wrong question, takes irrelevant matters into account, or reaches an irrational conclusion unsupported by evidence. Valuation assumptions under the 1992 Regulations prescribe the basis on which the property is to be assessed. They do not restrict the tribunal to evidence concerning properties held on 99-year leases at nominal rents. Relevant evidence may include freehold and longer leasehold transactions, provided the tribunal recognises and evaluates the differences between them. A tribunal need not calculate a precise value where its statutory task is to determine the correct council tax band.

The appellant owned a freehold flat entered in council tax band C. The Listing Officer confirmed that band, and the Valuation Tribunal dismissed the appellant’s merits appeal. The tribunal’s written decision relied on comparable properties, including freehold and longer leasehold properties, and concluded that the difference between leasehold and freehold values in 1991 terms was minimal.

The appellant appealed under regulation 43 of the Valuation Tribunal for England (Council Tax and Rating Appeals) Regulations 2009. He argued that the tribunal had applied the wrong valuation assumptions, had relied on unlawful comparables, and had reached an irrational conclusion.

1. Appeal dismissed. The appeal was confined to questions of law. It was not a rehearing of the valuation evidence or merits.

2. The relevant public law grounds were whether the tribunal had applied the wrong legal principles or asked the wrong question, and whether its conclusion was irrational, for example because no evidence supported it or it was outside the range open to a properly directed tribunal.

3. Regulation 6 of the 1992 Regulations required the valuation exercise to proceed on common assumptions, including that the relevant interest in a flat was a 99-year lease at a nominal rent. That requirement governed the basis of the valuation exercise. It did not mean that the tribunal could consider only evidence relating to 99-year leasehold flats. Comparable evidence could include freehold or 125-year leasehold properties, provided the differences were recognised and taken into account.

4. The tribunal had asked itself the correct statutory question: what value the property would have realised on the open market at 1 April 1991, assessed on the statutory basis. It was entitled to consider the evidence placed before it, including the purchase of the freehold, the tone of the list, comparable properties and the property’s integral garage.

5. The tribunal expressly recognised a difference between freehold and leasehold values but concluded, on the evidence, that the difference in 1991 terms was minimal. That was a factual conclusion open to it. The High Court could not substitute its own assessment merely because other evidence might have supported a different result.

6. The tribunal was required to determine the correct band, not to produce a precise valuation figure. No error of law or irrationality was established. The respondent was awarded costs, summarily assessed at £4,500, payable within 14 days unless otherwise agreed.

• Valuation Tribunal: The appeal against the Listing Officer’s band C decision was dismissed on 10 September 2013. An application for review was refused by the tribunal’s Vice President.
• High Court (Administrative Court): The appeal on points of law was dismissed.