Woolway (Appellant) v Mazars (Respondent) - [2015] UKSC 53

Trinity Term

[2015] UKSC 53

On appeal from: [2013] EWCA Civ 368

JUDGMENT

Woolway (Appellant) v Mazars (Respondent)

before

Lord Neuberger, President

Lord Sumption
Lord Carnwath
Lord Toulson
Lord Gill (Scotland)

JUDGMENT GIVEN ON

29 July 2015

Heard on 11 February 2015

Appellant Advocate to the Court

Timothy Morshead QC

David Forsdick QC

Daniel Kolinsky QC

(Instructed by HMRC

(Instructed by The

Solicitors Office) Government Legal
Department)

LORD SUMPTION: (with whom Lord Carnwath and Lord Toulson agree)

1. Local authority rates are the oldest tax in continuous existence in England, having originally been introduced in the reign of Queen Elizabeth I by the Poor Relief Act 1601 (43 Eliz 1, c 2). Historically, they were payable in respect of the rateable occupation of hereditaments, and that continues to shape the law in this area even though non-domestic rates are today imposed on unoccupied hereditaments also. The core concepts underlying the assessment of rates are that they are a tax on

property and not on persons or businesses, and that the “hereditament” is the unit of

assessment. Each hereditament is separately identified in the rating list and separately assessed, notwithstanding that the same occupier may have more than one. The question at issue on this appeal is how different storeys under common occupation in the same block are to be entered in the rating list for the purpose of non-domestic rating.

2. Tower Bridge House is an eight-storey office block in St Katherine’s Way in

the London Borough of Tower Hamlets. In plan it is a U-shaped building. The open space between the three wings is filled by a covered atrium, with a central lift shaft containing six high-speed lifts serving the first to seventh floors of the building. There is a common reception area on the first floor serving the entire building. Mazars is a firm of chartered accountants which occupies the non-common areas of the second and sixth floors under separate leases. The first, third, fourth and fifth floors are occupied by the solicitors Reynolds Porter Chamberlain. The seventh floor is divided between two other occupants.

3. Where different parts of an office building are occupied by the same occupier, the ordinary practice of the valuer, and apparently of valuers generally, is to enter them as a single hereditament if they are contiguous, but as separate hereditaments if they are not. In accordance with this practice, in the 2005 rating list, the non- common parts of the two storeys occupied by Mazars were entered as separate hereditaments. The non-common parts of the first storey occupied by Reynolds Porter Chamberlain were entered as one hereditament, and the non-common parts of the third, fourth and fifth floors occupied by the same firm were together entered as another hereditament. Each of the spaces separately occupied on the seventh floor was also entered as one hereditament. In February 2010, Mazars applied to merge the two entries for the spaces demised to them to form a single hereditament, with an allowance for fragmentation of…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Keep reading for free

Create a free CaseChat account to read Woolway (Appellant) v Mazars (Respondent) and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2015] UKSC 53
Decision Date

CaseChat Overview and Summary

In Woolway (Appellant) v Mazars (Respondent), the Supreme Court was called upon to decide whether two floors of an office block, occupied by the same tenant but physically separate, should be treated as a single hereditament for the purposes of non-domestic rating. The case arose from an appeal by the Valuation Officer against a decision of the Upper Tribunal (Lands Chamber) that the second and sixth floors of Tower Bridge House, which were occupied by the firm of Mazars, constituted a single hereditament. The Supreme Court allowed the appeal, holding that the two floors should be treated as separate hereditaments. The court held that the identification of a hereditament for rating purposes should be guided by the principle that a hereditament is a self-contained piece of property. The court rejected the idea that functional integration of separate premises could override the geographical test, emphasising that rates are a tax on property and not on the business of the occupier. The court noted that while exceptional circumstances might justify treating separate premises as a single hereditament, the mere fact that they were occupied by the same tenant was not sufficient. The decision clarified the law on the identification of hereditaments for rating purposes, rejecting the approach taken in the earlier Court of Appeal decision in Gilbert v S Hickinbottom and Sons Ltd. The Supreme Court's judgment provided a principled approach to the issue, emphasising the importance of a clear and practical test that could be uniformly applied.

Orders