Espresso Rooms UK Limited v Nicola Johnson

In valuing a hereditament, the actual rent is ordinarily a starting point, but its weight depends on how closely its timing, terms and subject matter correspond to the statutory rating assumptions. Comparable rents and assessments may confirm or displace the indication given by the actual rent. A rent agreed after the antecedent valuation date may carry little weight where it is an outlier and the relevant lease terms are unusual. The valuation must be based on the evidence considered in the round, including matters existing at the material day and values at the antecedent valuation date.

The appellant challenged the rateable value of a café premises in the 2017 rating list. The Valuation Tribunal for England dismissed the appeal against an entry reduced to £146,000. On further appeal, the respondent conceded that the defended assessment was excessive.

The principal issue was the weight to be given to the premises’ November 2017 letting when assessing rateable value by reference to the antecedent valuation date of 1 April 2015. The Tribunal also considered comparable rental evidence, a later assessment of nearby premises, and concerns about the independence of the appellant’s expert.

1. Appeal partly allowed. The rateable value was determined at £1,600 per square metre Zone A, amounting to £109,000 overall.
2. Under Local Government Finance Act 1988, Schedule 6, paragraph 2(1), rateable value is assessed by reference to the hypothetical letting on the antecedent valuation date, subject to the statutory assumptions. Matters required by paragraph 2(7) are taken as they existed on the material day.
3. The guidance in Lotus and Delta Limited v Culverwell (VO) and Leicester City Council [1976] RA 141 was applied. The actual rent is a starting point, but the weight given to it depends on the closeness of its timing, subject matter and conditions to the statutory assumptions. Comparable rents and assessments are relevant to confirming or testing the indicated value.
4. The subject rent was agreed two years and seven months after the antecedent valuation date, was conspicuously below the comparable evidence, and arose from terms which did not sufficiently correspond to the statutory assumptions. It therefore received little weight. The comparable lettings, adjusted to the antecedent valuation date, produced a close range supporting £1,600 per square metre Zone A.
5. The reduced assessment agreed for 35 Frith Street was relevant comparative evidence, although the absence of details concerning fit-out costs and return frontage limited the conclusions that could be drawn from it.
6. An expert who has also acted as a party’s representative may face difficulty demonstrating impartiality and objectivity. Such an expert must take particular care to acknowledge that role and explain compliance with the duties of an expert, including the requirements in paragraphs 19.6 and 19.15 of the Tribunal’s Practice Directions.

• Valuation Tribunal for England: The appeal against the rating-list entry was dismissed on 9 May 2025.
• Upper Tribunal (Lands Chamber): The appeal was partly successful. The assessment was reduced to £109,000 overall.