The Secretary of State for Health And Social Care On Behalf of Public Health England, R (On the Application Of) v Harlow District Council

Rateable occupation requires actual, exclusive and non-transient possession, together with possession of some value or benefit to the occupier. Minimal use may suffice. The occupier’s purpose may be rates mitigation, and the benefit may consist in accumulating the period required to obtain a future exemption. The use need not be substantial, legally required or commercially valuable.

Occupation is not established by abandoned goods, or by use confined to maintenance, preservation or preparation for future operational use. Where the facts are undisputed and the legal requirements are met, the billing authority must recognise occupation. A building may therefore be occupied for the statutory qualifying period and unoccupied afterwards.

Public Health England challenged Harlow District Council’s refusal to recognise rateable occupation of its future headquarters. PHE had stored crates of its documents and other belongings at the property for six weeks, then removed them, seeking the resulting three-month exemption from unoccupied non-domestic rates. It repeated the arrangement later in 2018.

The central issues were whether minimal storage motivated by rates mitigation constituted occupation, whether the contents had to be of substantial or independent value, and whether furniture, cleaning equipment, displays and occasional meetings meant that the property remained occupied between the qualifying periods.

1. The claim was allowed. Harlow’s decisions were quashed because they proceeded on a wrong understanding of the law. On the undisputed facts, PHE was in occupation during both six-week periods and was not in occupation outside them. Harlow was required to repay the rates paid following its demand.
2. The court applied the four requirements derived from JS Laing v Kingswood Area Assessment Committee [1949] 1 KB 344: actual occupation, exclusive possession, possession of some value or benefit, and possession that is not too transient.
3. Actual use may be minimal. Voluntary storage of a small quantity of the possessor’s goods is sufficient where there is an intention to occupy. The goods need not be of substantial value, legally required to be stored at the property, or cheaper to store there. The purpose may be whimsical or eccentric, and may consist solely of obtaining a future rates exemption.
4. Where the motive is rates mitigation, the occupier ordinarily necessarily intends to occupy for the qualifying period. The court approved the reasoning in R (Makro Properties Limited) v Nuneaton & Bedworth BC [2012] EWHC 2250 (Admin). The contrary authorities, Minister of Transport v Holland (1962) 14 P&CR 259 and Wirral BC v Lane (1979) 21 RRC 340, were not persuasive because intention had not been examined as part of the ratio in either case.
5. Two qualifications applied. The purpose must go beyond upkeep, development or preparation of the property itself. Goods inferred to have been abandoned because they were not worth removing are insufficient. These qualifications reflected Arbuckle, Smith & Co Ltd v Greenock Corporation [1960] AC 813 and London County Council v Hackney Borough Council [1928] 2 KB 588.
6. The boardroom furniture, model, display boards, cleaning equipment and occasional meetings concerned maintenance or preparation for future use. They did not establish present rateable occupation. The court therefore rejected Harlow’s alternative case that PHE remained in occupation throughout. The possible application of the exclusion in section 65(5) of the Local Government Finance Act 1988 was not necessary to decide, although the judge expressed a provisional view that the items would likely constitute equipment.