Flight Centre (UK) Limited v A Ricketts (Valuation Officer)

Rateable value must be assessed by applying the statutory assumptions at the relevant valuation dates. Where the property is actually let, its rent is the starting point, but its weight depends on how closely the letting reflects those assumptions. Comparable rents and existing assessments may confirm or qualify the indication from the subject rent.

The valuation must address the physical characteristics of the hereditament, including an irregular layout, and the evidence must be directed to the value of that property rather than broad rental trends. A court may find differing values within a parade without identifying a precise tone-of-the-list break point where that issue is unnecessary to the determination.

Flight Centre (UK) Limited, the occupier and ratepayer of 42 Upper Street, London, appealed against the Valuation Tribunal for England’s decision of 10 December 2020, which had confirmed the property’s 2017 Rating List assessment at £127,000. The Valuation Officer subsequently accepted that the assessment was excessive and proposed £121,000.

The appeal concerned the appropriate Zone A rate at the 1 April 2015 antecedent valuation date. Flight Centre sought £1,600 per m² and the respondent sought £2,000 per m². The central issue was the weight to be given to the subject rent and comparable rental evidence, including whether values faded towards the northern end of the parade.

1. Appeal allowed in part as to valuation. The rateable value was determined at £104,600, with no order as to costs.
2. Under paragraph 2(1) of Schedule 6 to the Local Government Finance Act 1988, as amended by the Rating (Valuation) Act 1999, rateable value is the rent reasonably expected on the statutory assumptions. Matters specified in paragraph 2(7) are taken as they existed at the material day, while values are assessed by reference to the antecedent valuation date.
3. The guidance in Lotus and Delta Ltd v Culverwell (VO) [1976] RA 141 was adopted. The actual rent is the starting point where the hereditament is let. Greater weight is given where the letting closely reflects the statutory assumptions. Comparable rents and other assessments are then considered, with weight determined by the nature of the subject rent and the degree of comparability.
4. The subject rent produced an agreed analysis of £1,713 per m² Zone A, but insufficient account had been taken of the property’s irregular rear shape. A 5% overall allowance was appropriate, producing £1,790 per m² Zone A. The nearly contemporaneous letting of No. 29 was useful. The letting of No. 40 attracted reservations because of its unusual terms and uncertainty about the first-floor configuration. The lease renewal at Nos. 23–24 was relevant but carried less weight because the previous rent was unavailable.
5. The evidence established lower values at the northern end of the parade, but did not establish an obvious break point or justify the proposed £2,000 per m² tone. Longer-term rental growth evidence did not adequately address the valuation of the subject property. The appropriate Zone A value was £1,800 per m², producing £104,674 before rounding, and therefore a rateable value of £104,600.

1. Upper Tribunal (Lands Chamber): allowed the appeal as to the valuation and determined the rateable value at £104,600.
2. Valuation Tribunal for England: by decision dated 10 December 2020, dismissed the appeal and confirmed the compiled-list assessment at £127,000.