BNPPDS Limited & BNPPDS Limited (Jersey) as trustees for Blackrock UK Property Fund v Andrew Ricketts

For rating valuation, a shopping-centre car park is not a separate mode or category of occupation merely because it serves the centre and its customers. The valuer should avoid artificially narrow categories, while making justified adjustments for relevant physical and operational differences.

A valuation based on a percentage of fair maintainable trade requires rigorous supporting rental evidence or an established rental tone. Where neither exists, a full receipts-and-expenditure valuation is preferable. The tenant’s share of divisible balance must reflect profit, risk and return on capital. Where trading is constrained and evidence does not justify a different weighting, a 50:50 division may be appropriate.

An allowance for a material change of circumstances must be based on evidence which separates its effect from other causes of declining receipts.

BNPPDS Limited & BNPPDS Limited (Jersey) as trustees for Blackrock UK Property Fund v Andrew Ricketts was an appeal by the ratepayers from the Valuation Tribunal for England’s dismissal, on 1 February 2021, of their challenge to the £229,000 rateable value in the 2017 rating list for the car park at Putney Exchange Shopping Centre.

The parties disagreed over whether the car park had a distinct mode or category of occupation, the proper valuation method, the division of divisible balance under a receipts-and-expenditure valuation, and the effect of competing material changes of circumstances. The alleged changes were redevelopment at Southside Shopping Centre and works at Putney Exchange.

1. Appeal allowed. The Tribunal determined the rateable value at £211,652, rounded to £211,500.

2. The car park was in the same mode or category of occupation as other multi-storey car parks. Its integration with a shopping centre and its particular features did not justify a separate category. The Tribunal adopted the broad approach to categorisation described in Hughes (VO) v Exeter City Council, [2020] UKUT 7 (LC). Relevant physical and operational differences could instead be reflected by valuation adjustments.

3. The shortened method, which values a car park by a percentage of fair maintainable trade, was inappropriate. It depends on reliable rental analysis or an established rental tone. The available rental evidence was incomplete and inconsistent, and only a small proportion of comparable car parks had agreed assessments. A full receipts-and-expenditure approach was therefore required.

4. The Tribunal adopted gross receipts of £684,000 at the antecedent valuation date and expenses of £180,600. After agreed interest on working capital and an allowance for depreciation, it assessed a divisible balance of £491,704. In the absence of reliable evidence supporting either party’s proposed weighting, the tenant’s proper reward for profit, risk and capital justified a 50:50 division.

5. Applying Local Government Finance Act 1988 Schedule 6 and the material-change provisions of the Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009, the Tribunal found that neither party had isolated the full cause of the fall in receipts. It allowed a 10% reduction in fair maintainable trade for the combined effects of Southside’s redevelopment and the Putney Exchange works.

6. The Tribunal did not need to decide whether the valuation officer could seek an increased assessment without a cross-appeal, because its determination was below the assessment in the rating list.

• Upper Tribunal (Lands Chamber): Allowed the ratepayers’ appeal and determined the rateable value at £211,500: [2022] UKUT 129 (LC).
• Valuation Tribunal for England: On 1 February 2021, dismissed the ratepayers’ appeal against the £229,000 assessment in the 2017 rating list.