UKI (Kingsway) Ltd v Westminster City Council

The Supreme Court considered the requirements for valid service of a completion notice under section 46A and Schedule 4A to the Local Government Finance Act 1988. The court held that service is properly understood as causing the notice to be received by the intended recipient and that a sufficient causal link between the billing authority's actions and receipt by the owner is required. On the facts, a completion notice hand-delivered to the building receptionist (not authorised formally) who passed it to the owner, and which was thereafter received by the owner in electronic form, amounted to valid service. The court further held that transmission of a legible electronic copy (here a scanned copy by email) can, under general principles, have the same legal effect as delivery of a paper copy; the Electronic Communications Act 2000 did not displace that common-law position. The Court restored the Upper Tribunal's decision allowing service to be effective, emphasising that authorities should use the statutory methods in Schedule 4A where certainty of date and method of service is required.

This appeal concerned whether a completion notice, served by a billing authority by hand at the premises and passed by an on-site receptionist to the owner, and received by the owner in scanned electronic form, was valid to bring a new building into liability for non-domestic rates.

Background and parties: UKI (Kingsway) Limited carried out redevelopment of premises at 1 Kingsway. Westminster City Council sought to serve a completion notice specifying a completion day under section 46A and Schedule 4A of the Local Government Finance Act 1988 in order to cause the building to be entered in the rating list. The notice was handed to a receptionist employed by the building manager (Eco FM) and a scanned copy was emailed to UKI. UKI appealed, contending that the notice had not been validly served because it had not been delivered directly to the owner or to an authorised agent and had been received electronically.

Procedural history: The Valuation Tribunal allowed UKI's appeal. The Upper Tribunal reversed that decision and found service effective. The Court of Appeal reinstated the Valuation Tribunal. The appeal to the Supreme Court raised two issues: (i) whether service effected by delivery to a third party (an unauthorised receptionist) could constitute service "on the owner by the authority"; and (ii) whether receipt of an electronic scanned copy could constitute valid service.

Issues framed: (i) Is a completion notice properly served where the billing authority's notice reaches the addressee indirectly via an unauthorised third party? (ii) Does receipt of an electronic (scanned) copy by email suffice for service?

Reasoning: The court adopted a causation-based approach: service requires that the authority have caused the notice to be received by the recipient. There must be a sufficient causal connection between the authority's actions and receipt by the owner. Agency or formal delegation is not necessary where the route taken was the natural and foreseeable consequence of the authority's act. On the facts the receptionist did what a reasonable responsible employee would do in passing a hand-delivered notice to the addressee, so the chain of causation was not broken and the authority had caused the notice to be received. On electronic communication, the court treated authorities and earlier authorities accepting fax transmission as establishing that a legible electronic copy can achieve the same result as a paper copy; the Electronic Communications Act 2000 was intended to facilitate electronic communication and did not displace the existing common law rule. The court noted authorities should use the specific statutory modes of service in Schedule 4A when certainty of date and method is important, but that choosing a non-statutory method carries the attendant risks.

Relief sought and disposition: The billing authority sought to uphold the validity of its completion notice. The Supreme Court allowed the appeal and restored the Upper Tribunal's order that the notice was validly served.

Appeal allowed. The Supreme Court held that service requires the authority to have "caused" the notice to be received by the intended recipient so there must be a sufficient causal link between the authority's actions and receipt. On the facts the hand-delivered notice, passed by the building receptionist to the owner and received in electronic form, satisfied that requirement. The court also held that reception of a legible electronic copy can constitute valid service under the general law and that the Electronic Communications Act 2000 did not displace that position.

Valuation Tribunal: appeal allowed (President Graham Zellick QC). Upper Tribunal (Deputy President Martin Rodger QC) [2015] RA 433: reversed the Valuation Tribunal and found service effective. Court of Appeal [2017] PTSR 1606: reinstated the Valuation Tribunal and held service ineffective. Appeal to the Supreme Court ([2018] UKSC 67): appeal allowed and Upper Tribunal's order restored.