Part 5: Procedures 2010 Rating List (England), 2017 Rating List (Wales)
The Valuation Office Agency's (VOA) technical manual for the rating of business (non-domestic) property.
Proposals: Part 5 covers procedures for the 2010 Rating List England and 2017 Rating list Wales and previous rating lists. It covers proposal forms and requirements, rights to make proposals and grounds of proposals, service of notices, transfer to representatives, insolvency of occupier and service of copies of proposals on other parties. Also included proposals outside the VO area, statutory requirements for Wales, invalidity procedures (including invalidity notices, invalidity at VT, late identification if invalidity)
England (2010)
The Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009’ (SI 2009/ 2268) (‘Appeal’ Regulations)
The Valuation Tribunal for England (Council Tax and Rating Appeals) (Procedure) Regulations 2009’ (SI 2009 / 2269) (‘Procedure Regulations’)
The Non-Domestic Rating (Material Day for List Alterations) 1992 (SI 1992/556)
Wales (2017 and earlier)
The original procedures as per the 2010 Rating List still apply
The Non-domestic (Alteration of Lists and Appeals)(Wales) Regulations 2005 [WSI 2005 No.758 (W.63)]
2.1 VO proposal forms
Although no statutory proposal form has been prescribed by law, a standard form has been produced by the Valuation Office. Occupiers, Owners and BAs should be encouraged to use the official Valuation Office form whenever they wish to make a proposal.
For 2017 rating list in Wales the standard form for use by persons who wish to make proposals is Form VO7012. A Welsh version is available if requested in the Welsh language.
2.2 Agents’ proposal forms
Some of the larger firms of rating surveyors and organisations such as the Solicitors Law Stationery Society (Oyez Printing) have devised their own proposal forms based on the VO’s versions. Although they may differ in certain ways from the VO forms they should be accepted provided all the information statutorily required is supplied
2.3 Proposals in the form of a letter
A letter may be accepted as a valid proposal if it fulfils all the statutory requirements and purports to be a proposal.
It is important, therefore, that any letter so identified should be processed as proposal and attached to a blank proposal form, the required coded data should be entered in manuscript in the “Official use only” panel on the blank proposal form. The data should be input on RSA and a copy kept in EDRM
Any letter which does not meet all the statutory requirements should be returned to the sender. It should be accompanied by a covering letter VO 7043 enclosing a blank proposal form and a set of guidance notes on the completion of a “proposal to Alter the rating list. A copy of the ratepayer’s letter should be made and retained by the VO. The proposal form should be pre-stamped in the top left-hand corner with the correct VO’s address and telephone number
All proposals should be able to stand in their own right and be clear as to its grounds and reasoning. If there is ambiguity or there is confusion then the proposal should be made invalid and the invalidity procedures followed
See RM Section 6, Part 2 : Interpretation of Grounds of Proposal
RM section 6, Part 3: Errors and Omissions in proposals
2.4 Proposals which have a schedule of properties attached
Current provisions generally require a proposal to deal with one hereditament only. The exceptions are where a proposal seeks a split or merger of hereditaments or where the proposal relates to hereditaments within one building or curtilage and the maker of the proposal makes it in the same capacity for each hereditament (for example owner) - see Regulation 6(4) The provisions apply equally to email and hard copy proposals.
Consequently, proposals served on the VO in a ‘schedule’ format whereby properties are merely listed and rely on shared information such as grounds, proposer’s name and similar information are not valid, unless the hereditaments fall within the same building or curtilage.
However, if email proposals are served in schedule formation but on printing each stands on its own and does not share common information, such proposals will not offend and should not be invalidated (unless the proposals are defective in some other way). Emails containing (or comprising) multiple proposals which do not print out as individual stand alone proposals are not valid.
Invalidity procedures under Regulation 8 (SI 2009/2268 pre 2017 amendments) should be followed by treating the schedule as an invalid proposal against the first item in the list of properties
2.5 Petitions
A document in the form of a petition should be carefully examined to decide whether it contains all the necessary information to constitute a valid proposal. Although it is considered unlikely that a petition, signed by a number of signatories, will constitute a valid proposal, nevertheless such a document must not be ignored.
If it is the clear intention of the signatories to such a document to seek a reduction in their individual rating assessments, it will almost invariably be necessary to write to each of them individually, enclosing a set of guidance notes on the completion of a “proposal to Alter the rating list and an official proposal form with a request for it to be completed and returned to the VO within any statutory time limit.
2.6 Additional proposal forms
The VO should supply an additional proposal form to any intending proposer who requests one for his/her own retention.
2.7 Proposal forms for occupiers, owners and agents - 2017 Wales and 2010 Rating Lists
Occupiers and owners may be provided, free of charge, with a quantity of proposal forms corresponding to the number of hereditaments occupied or owned by the person(s) or business organisation concerned.
Where an agent is duly authorised to act on behalf of a number of individual occupiers or owners, the agent may be supplied free of charge with the number of proposal forms corresponding to the number of clients he/she represents
2.8 Bulk supplies of proposal forms
A reasonable quantity of proposal forms may be supplied free of charge, on request, to ratepayers associations, chambers of commerce and/or trade, and similar local organizations for use by their own members.
Before supplying the forms, however, the VO should arrange to discuss with the Chairman, or another officer of the organization concerned, the grievance(s) giving rise to the request for the proposal forms and to explain the basis of rating assessments.
Such a discussion may prevent the making of misconceived or frivolous proposals. If, following a discussion, the organization decides that its members still wish to make proposals, the VO should encourage the use of VOA online proposal application. If this is not suitable for any reason the VO should supply the necessary number of forms ensuring that each one is stamped with the office address and phone number of the Valuation Officer for the Billing Authority in which the hereditament concerned is situated.
Professional firms, such as surveyors, estate agents and solicitors, should similarly be encouraged to use the VOA website or web-services systems but may be supplied, on request, with no more than 50 blank proposal forms at any one time, free of charge. Where a firm indicate that they are acting for a particular group of occupiers, or for the owner(s) of a number of properties, either in the locality or nationwide, the firm may be supplied, free of charge, with the number of forms corresponding to the number of properties involved. A corresponding number of forms for retention by the firm as their own copies may be supplied, if requested.
In all other cases, the applicant should be asked to write to CEO (Customer Services) where the request will be dealt with on an individual basis.
BAs should be asked to issue blank proposal forms only to individual ratepayers and to forward to the VO any requests they receive for bulk supplies of proposal forms.
2.9 Completion of proposal forms before issue
Before a proposal form is issued to an intending proposer it should be completed in the top left-hand corner with the correct VO’s address and telephone number. The VO’s address should be inserted by means of a rubber stamp using a black ink pad. A clear legible impression should be made.
Normally, no other entry should be made on the blank proposal form. All the relevant information to be entered on the form is to be inserted only by the maker of the proposal. All the information which the proposer supplies constitutes part of the proposal itself.
If exceptionally, the VO wishes to make any notes on the proposal form before it is issued, eg. the assessment number, these should be made only in the column headed “Official use only”.
2.10 Guidance notes on the completion of proposals
Guidance notes in leaflet form [VO 7012GN(2010)] have been produced to assist makers of proposals to fill in the form correctly. A leaflet should be issued with the proposal form. The guidance notes are also available to download and print from the website in both English and Welsh
The right to make a proposal is governed by
England (2010)
The Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009’ (SI 2009/ 2268)
The Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009. (SI 2009/2268)
This latter act provides limited circumstances in which 2010 proposals may be made between 17 December 2018 and 31 December 2019
see RM Section 7: Property in Common Occupation (PICO) & Nursery grounds
for specific requirements for proposals under the PICO legislation
Wales (2017)
The Non-domestic rating Alteration of Lists and Appeals) (Wales) Regulations 2005 (SI) 2005 No 758 (W.63).
Regulation 4 sets out the circumstances in which proposals may be made in respect of the 2005 lists and subsequent lists.
Regulation 5 sets out the periods in which proposals may be made in respect of the 2005 and subsequent lists.
Regulation 6 sets out the manner of making proposals and information to be included.
3.1 Who may make proposals
Reg 2(1)
(1) An interested person, a relevant Authority or in specific circumstances described below, a former interested person may make a proposal to alter the rating list in appropriate circumstances.
“interested person” means:-
(a) in relation to a hereditament which forms part of the Crown Estate and is held by the Crown Estate Commissioners under their management within the meaning of section 1 of the Crown Estate Act 1961(b), means the Crown Estate Commissioners;
(b) in relation to any other hereditament,
(i) the occupier;
(ii) any other person (other than a mortgagee not in possession) having in any part of the hereditament either a legal estate, or an equitable interest such as would entitle him (after cessation of any prior interest) to possession of the hereditament or any part of it; and
(iii) any person having a qualifying connection with the occupier or a person described in (ii).
“Qualifying connection” is defined in Reg 2 (2).
A qualifying connection will exist where both persons are companies and either one is a subsidiary of the other or both are subsidiaries of the same company; or where only one person is a company, the other person has such an interest in the company as would result in its being, (if the person was a company), a holding company of the other.
Mainstream Ventures Limited v Woolway (VO) [2000] RA 395 confirmed that “an interested person” has to be an interested person at the time the proposal is made. In this case at the time the proposal was made the maker of the proposal was no longer the occupier of the hereditament to which the proposal referred.
There is a third category of persons who can make proposals, A ‘former interested person’ who can only submit a proposal challenging a VO’s list alteration on the grounds that the VO has chosen
(a) the wrong Rateable Value or
(b) effective date.
By Regulation 4(2)(c), a proposal may be made by someone who was an interested person during the period for which the list alteration had effect.
“Relevant authority”, in relation to a hereditament, means the authority in whose area the hereditament is situated.
“National Assembly” means the National Assembly for Wales
3.2 Proposals against the compiled list entry where a reconstitution has occurred
An interested person can only make a valid proposal when they still have some interest in the hereditament referred to in the proposal. If a compiled list assessment is altered by a subsequent split or merger, the original compiled list hereditament no longer exists and therefore cannot be appealed against, a proposal against the compiled list entry will be invalid.
One situation where an interested person could lodge a valid proposal against a now deleted compiled list entry would be in the case of a former composite property which has become solely domestic and therefore had the Non domestic rating list entry deleted, the original occupier of the property could make a proposal against the now deleted compiled list entry during the life of the list provided they had remained in occupation of the property.
Similarly, where the VO has altered the historic entry(ies) from which the reconstituted entries were derived, perhaps to correct the compiled list entry or to reflect a pre-reconstitution MCC, a person who was an interested person during the period affected by the VO alteration may make a valid proposal.
It is important to identify the hereditament when considering validity. If an assessment has changed because of, for example, a temporary reduction for road works, the hereditament hasn’t changed. Provided the proposer is an interested person on the day the proposal is made, they could still make a valid compiled list proposal.
PICO - England 2010
The 2010 Rating List for England has now closed and not further proposals may be made with the exception of - where proposals may still be made
see RM Section 7: Appendix 4 : limited circumstances in which 2010 list proposals may be served
IB VOA - NDR (England) 2010 Proposals to merge or reconstitute
There are 2 circumstances in which 2010 proposals may still be made
(SI 2018/1193)
(1) Properties in Common Occupation (Part 2 SI 2018/1193)
(2) Nursery Grounds (Part 3 SI 2018/1993)
This latter act provides limited circumstances in which 2010 proposals may be made between 17 December 2018 and 31 December 2019for (1) Properties in common occupation - grounds of proposal only allowed under Reg 4(1)(k)
(k) Merger or reconstitution of hereditaments
Property which is shown in the list as more than one hereditament ought to be shown as one or more different hereditaments.
and
for (2) Nursery grounds - grounds of proposal only allowed under Reg 4(1) (h) or (i)
(h) Deletion of entry from list
A hereditament shown in the list ought not to be shown in that list.
(i) Partially domestic or exempt
The list should show that some part of a hereditament which is shown in the list is domestic property or is exempt but does not do so.
see procedures manual and IB for process to follow
IB VOA - NDR (England) 2010 Proposals to merge or reconstitute
Context of relevant proposals
To serve a relevant proposal the only ground that can be relied on in this circumstance is taken directly from regulation 4(1)(k) of the 2009 regs.
However, for a PICO proposal, the grounds of reg 4(1)(k) must be read in the context of the Rating (Property in Common Occupation and council Tax (Empty dwellings) Act 2018 when considering if the proposal is validly made or not.
Whilst the relevant proposal covers the grounds set out in in reg. 4(1)(k), to be valid it must be one that can only be made as a consequence of the coming into force of section 64(3ZA)(a) or (3ZB) of the PICO Act. If it could have been made under the previously existing legislation then such a proposal does not meet the requirements of the regulations and will be invalid.
N.B. The proposer has to be in occupation/ownership of the two parts being merged. If the proposer is not then he cannot meet the requirements of the PICO Act and regulations. The intention of the legislation was to cover requests for merger and not requests to split assessments.
Proposals on this ground can only be made between 17 December 2018 and 31 December 2019 in respect of the 2010 rating list. Any 2010 rating list proposals served on the VO outside of this period will be invalid. (unless it is one made under Reg 5 SI 2018/1193, where in specific circumstances only, a proposal can be made within 6 months of a VO alteration under PICO
Agreements under PICO
see RM S6 part 6 Proposals - Settlement of proposals before a VT decision - 5.0 Settlement of Relevant proposals/ appeals by agreement.
VOs are advised to use the agreement form generated by RSA, and to manually add the end date to the schedule after Revised Entry(ies) in the form “Alteration Effective to –/–/–”.
Due to the necessity for a start date and an end date, VOs are advised that only the Proposer and the Valuation Officer need to sign the agreement form. The regulations have been introduced with the intention of reversing alterations made following the ‘Woolway v Mazars’ Supreme Court decision. The reasoning behind the end date is to ensure that alterations made following relevant proposals do not interfere with the liability of any ratepayer other than the proposer.
In the event the changes to be made under the PICO proposal involves other occupiers
of the hereditaments other than just the proposer (eg if multiple properties being re-configured) then those persons will need to become party to Proposal and their agreement sought as well. For further advice please contact the Technical Adviser
Effective dates & Material dates
see RM Section 2 VOA - Part 4
If the proposal is a relevant one for 2010, ie one made under SI 2018/1193 (PICO) regs then the effective date is not date restricted to 1/4/15 and can go back to 1/4/10 if appropriate having regard to the circumstances.
N.B. if the 2010 proposal is an original outstanding one ie one previously made against the 2010 list, prior to the introduction of the PICO legislation, where the grounds include merger then the effective date restricted provisions still apply. See RM Chapter 3, Part 2 Section 5 and S5 Appendix 2 for details
Application of the PICO Act to the hereditament
See Section 2 Part 2 1.3.1 which covers the Identification of the hereditament
Examples of the application of PICO
see Appendix 1a of Section 2 Part 2 Examples following legislative amendments by the Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Act 2018 (England)
see also RM Section 6, part 2 : Interpretation of the Grounds of Proposal
RM Section 6, part 4: Scope of Proposal
RM Section 6, part 3 : Errors and Omissions in proposals
An interested person may make a proposal to alter the rating list in respect of a hereditament, subject to prescribed time limits on the following grounds:
Reg 4(1)
(a) Compiled list
The rateable value shown in the list for a hereditament was inaccurate on the day the list was compiled.
(b) Material change of the rateable value shown in the list for a hereditament is inaccurate by reason of a [material change of circumstances which occurred on or after the day the list was compiled.
See below for an explanation of “material change of circumstances”.
Also see
Upper Tribunal decision in RA/24/2018 UT Merlin v Cox
Rating Manual: Section 2 Part 7: Material change of circumstances
(c) Plant and Machinery
The rateable value shown in the list for a hereditament is inaccurate by reason of an amendment to the classes of plant and machinery set out in the Schedule to the Valuation for Rating (Plant and Machinery) (Wales) Regulations 2000(1) which comes into force on or after the day on which the list was compiled
(d) Inaccurate VO alteration
The rateable value shown in the list for a hereditament by reason of an alteration made by a valuation officer is or has been inaccurate.
However, no proposal under this provision may be made where the list alteration is giving effect to the decision of a valuation tribunal, the Lands Tribunal or a court determining an appeal or application for a review from either tribunal (Reg 4(3)(c) refers)
.
It should be noted that under this provision a proposal may be made in respect of an alteration which gives effect to a well-founded proposal or an agreement.
There will not be many occasions where an agent or ratepayer who has just agreed an alteration of the list with the VO may wish to challenge it, but where this does happen it is likely to be difficult for the maker of the proposal to show reason why the previous list alteration is incorrect.
(e) Tribunal decision
The rateable value or any other information shown in the list for a hereditament is shown, by reason of a decision in relation to another hereditament of a valuation tribunal, the VTE, the Lands Tribunal, the Upper Tribunal or a court determining an appeal or application for review from either such tribunal, to be or to have been inaccurate.
It should be noted that a Lands Tribunal decision is incomplete until all issues including costs have been determined. Sometimes an interim decision is given which deals with the substantive issues of an appeal but the decision on costs is reserved. Such a tribunal decision is not one that can be used as grounds for serving a proposal under regulation 4(1)(e).
Proposals may only be made citing a tribunal decision once the decision becomes final.
Where a proposal is made prior to the Lands Tribunal’s final decision, the VO should treat the proposal as invalid and issue a VO 7048 stating the following reason for invalidity:
The proposal is not valid because “the Lands Tribunal has not issued its final decision, this proposal should be re-served once the decision becomes final.”
See below regarding validity of proposals.
A Regulation 4(1)(e) proposal is the only kind of proposal which can be made where there has been a previous tribunal decision in relation to another hereditament and arising from the same facts (unless the valuation tribunal dismissed the appeal because every party other than the VO failed to appear).
(f) Inaccurate effective day in VO alteration
The day from which an alteration is shown in the list as having effect is wrong.
(g) Insertion of entry into list
A hereditament not shown in the list ought to be shown in that list.
(h) Deletion of entry from list
A hereditament shown in the list ought not to be shown in that list.
(i) Partially domestic or exempt
The list should show that some part of a hereditament which is shown in the list is domestic property or is exempt but does not do so.
(j) Not partially domestic or exempt
The list should not show that some part of a hereditament which is shown in the list is domestic property or is exempt but does so.
(k) Merger or reconstitution of hereditaments
Property which is shown in the list as more than one hereditament ought to be shown as one or more different hereditaments.
(l). Division of assessment
Property which is shown in the list as one hereditament ought to be shown more than one hereditament.
(m). Inaccurate address
The address shown in the list for a hereditament is wrong.
(n) Inaccurate description
The description shown in the list for a hereditament is wrong; and
(o) Omission of requirements of s42 (contents of local lists)
Any statement required to be made about the hereditament under section 42 of the Local Government Finance Act 1988 has been omitted from the list.
4.1 Requesting other changes to the Rating list
Reg 6(5)
Provides that where a proposal is made contending that either the RV or the effective date is incorrect by reason of an alteration made by the valuation officer, the proposer may request either or both of the following -
a) the restoration of the list to its state before the alteration was made; and
b) a further alteration of the list in respect of that hereditament.
This is particularly useful where it is contended that the effective date should be later than that adopted by the VO.
If this is the agreed outcome of the proposal then in order to give effect to the agreement the VO will not only have to bring the effective date forward to a later date on the appeal, but will also as a separate step have to restore the entry in the list to what it was at the earlier (but incorrect) effective date. Otherwise, the list entry will remain from that date as a live entry up until the agreed later effective date.
4.2 GROUNDS OF PROPOSAL - explanations Compiled List and MCCs
- (England 2010 and earlier, Wales 2017 and earlier)
See RM Section 6, part 2: interpretation of Grounds of Proposal
4.3 Restrictions on making proposals
The “one bite at the cherry” rule : reg 4(3)(b)(i)
The regulations only permit an interested person to make a single proposal in respect of each event, defined as the compilation of the list, a material change of circumstances or an alteration of the list by the valuation officer [regulation 4(3)(b)(i)].
This is what is commonly referred to as the “one bite at the cherry” rule and for example prevents an interested person from making repeated proposals to alter the compiled list by instructing new agents even though a previous proposal has been agreed or withdrawn. A second proposal on the same grounds made by or on behalf of the same interested person is invalid.
The restriction only relates to a given interested person, so that where the occupier has changed the new occupier is able to make a fresh proposal. Similarly, both the owner and occupier of a property may each make a valid proposal.
A further proposal may not be made for the same hereditament arising from the same facts where the original proposal has been considered and determined by the Valuation Tribunal or the Upper Tribunal.
4.4 Periods in which Proposals may be made - (England 2010 and earlier, Wales 2017 and earlier)
2010 List England
The 2010 Rating list is now closed and cannot be appealed or altered except to give effect to outstanding proposals or to properly give effect to an agreement from a settled proposal that has been incorrectly actioned or linked.
2010 List England - Where proposals may still be made
There are 2 exceptions to this following the introduction of the
(SI 2018/1193)
(1) Properties in Common Occupation (Part 2 SI 2018/1193)
(2) Nursery Grounds (Part 3 SI 2018/1993)
For a period from the passing of the Regulations, 17 December 2018 up to 1 January 2020 a proposal may be made
for (1) Properties in common occupation - grounds of proposal only allowed under Reg 4(1)(k)
(k) Merger or reconstitution of hereditaments
Property which is shown in the list as more than one hereditament ought to be shown as one or more different hereditaments.
and
for (2) Nursery grounds - grounds of proposal only allowed under Reg 4(1) (h) or (i)
(h) Deletion of entry from list
A hereditament shown in the list ought not to be shown in that list.
(i) Partially domestic or exempt
The list should show that some part of a hereditament which is shown in the list is domestic property or is exempt but does not do so.
See RM section 3: Effective dates for details of effective dates to apply
NB If there is an existing outstanding 2010 proposal for merger under Reg4(1)(k) then this is not a ‘relevant proposal’ under PICO and the statutory effective date restrictions will apply to that proposal
2017 List Wales
The period in which proposals may be made is governed by Reg 5: of SI 2009 No 2268 [England] and Reg 5: of SI 2005 No 758 [Wales] (W.63)
(1) Subject to paragraph (2) below, a proposal to alter a list compiled on or after 1 April 2017 may be made at any time before the day on which the next list is compiled.
(2) A proposal on the ground set out in:
(a) regulation 4(1)(d) or (f) [RV or effective date of an alteration is incorrect – see paragraph 3.3.1 above] may only be made before the day on which the next list is compiled or within six months of the date of the alteration, whichever is the later;
(b) regulation 4(1)(e) [VT/LT or higher court decision affects value] may be made no later than 6 months after the day on which the next list is compiled.
In the absence of a VON or quoting a tribunal decision the last date for making a proposal on the 2017 list is 31.03.21.
A proposal served outside the period detailed by the legislation will be invalid (Esau Brothers v Rodd (1992) RA 257). This is regardless of the fact that the issue is identified upon receipt and dealt with by an invalidity notice or is only realised at some subsequent date.
Where a proposal is quoting a UT or VTE decision, the last date is 1/10/21.
The last date the VO can alter the 2017 list by VON is 31.03.21, and the last date for a proposal against a VON is 6 months after the VO alters the list.
Previous Rating Lists (England and Wales)
These are now closed and cannot be appealed or altered unless there is an outstanding appeal.
.
4.5 Grounds on which Billing Authorities (BAs) may make proposals
- (England 2010 and earlier, Wales 2017 and earlier)
Relevant Authority
A BA is a relevant authority in relation to a hereditament if the hereditament is situated within that authority’s area - reg 2(1).
Right to make proposals
A BA has the right to make a proposal to alter the rating list for any hereditament of which it is an “interested person” - and has the same rights as any other occupier or owner.
The only other circumstances in which a BA may make a proposal are those contained within Regulation 4(2)(b). These are where the BA has reason to believe that the list is inaccurate because of
-
a material change of circumstances which occurred on or after the day the list was compiled
-
the RV or any other information shown in the list for a hereditament is shown, by reason of a decision in relation to another hereditament of a valuation tribunal, the Lands Tribunal or a court determining an appeal or application for review from either such tribunal
-
a hereditament not shown in the list ought to be shown in that list
-
a hereditament shown in the list ought not to be shown in that list
the list should show that some part of a hereditament which is shown in the list is domestic property or is exempt but does not do so
- the list should not show that some part of a hereditament which is shown in the list is domestic property or is exempt but does so
However, Reg 4(3)(b)(ii) does not allow a proposal to be made (other than following a tribunal decision in relation to another hereditament), where a proposal to alter the same list in relation to the same hereditament and arising from the same facts has already been considered and determined by a valuation tribunal (other than where the valuation tribunal dismissed the appeal because every party other than the VO failed to appear) or the Lands Tribunal
4.6 Grounds on which a former interested person may make a proposal
Reg 4(2) provides a limited number of circumstances in which a person who is not currently an interested person may make a proposal. Where he has reason to believe that-
(c) the RV shown in a list is inaccurate by reason of an amendment to the classes of P&M set out in the Schedule to the Valuation for Rating (Plant and Machinery)(England) Regulations 2000 (b) which comes into force on or after the day on which the list was compiled (the combined heat and power exception provisions), but see paragraph 3.3.1 c. above; or
(d) the RV shown in a list by reason of an alteration made by a VO is or has been inaccurate; or
(f) the day from which an alteration is shown in the list as having effect is wrong
he may make a proposal if he was an interested person at any time during which the alteration in question had effect.
There is however no right to make proposals under:-
to make a proposal challenging the RV shown in a VO list alteration under 4(1)(d where the alteration in question gives effect to a decision of a valuation tribunal, the Lands Tribunal or a court determining an appeal or application for a review from either such tribunal in relation to the hereditament concerned [Reg 4(3)(c)];
or
(apart from 4(1)(e)) where a proposal to alter the same list in relation to the same hereditament and arising from the same facts has already been considered and determined by a valuation tribunal [other than where the valuation tribunal dismissed the appeal because every party other than the VO failed to appear under Reg 30(4)] or by the Lands Tribunal [Reg 4(3)(b)(ii)]. Reg 4(1)(e) requires that the list entry be shown to be inaccurate by reason of a decision in relation to another hereditament
4.7 Material Change of Circumstances - (England 2010 and earlier, Wales 2017 and earlier)
Reg 4(1)(b) allows a proposal to be made to reflect a material change of circumstance -
The term is defined in Regulation 3 as follows:-
“material change of circumstances”, in relation to a hereditament, means a change in any of the matters mentioned in paragraph 2(7) of Schedule 6 to the Act”. (Local Government Finance Act 1988).
The matters referred to above are defined in the 1988 Act as follows:-
(a) matters affecting the physical state or physical enjoyment of the hereditament;
(b) the mode or category of occupation of the hereditament;
(c) the quantity of minerals or other substances in or extracted from the hereditament;
(cc) the quantity of refuse or waste material which is brought onto and
(d) matters affecting the physical state of the locality in which the hereditament is situated or which, though not affecting the physical state of the locality, are none the less physically manifest there; and
(e) the use or occupation of other premises situated in the locality of the hereditament.
4.8 Service of notices
General
Regulation 22 deals with the service of notices. This includes service of proposals on the VO and also service of notices by the VO.
Service of proposals on the VO
When completed, a proposal is to be served on the VO for the billing authority area in which the hereditament concerned is situated. Service is effected by delivering it by hand or sending it to the VO’s office either by post or by fax or email. If either fax or email is used it must be sent to the email address or fax number given for that purpose by the VO.
Electronic service is only effected when the transmission is capable of producing the text of the notice or proposal.
Where a hereditament straddles two or more BA boundaries, the proposal must be served on the VO who holds the rating list in which the hereditament is shown.
Service of notices by the VO
Where the VO is required to serve notice of a list alteration or a certificate of transitional relief the regulations state that service is to be on the ratepayer, but invalidity notices under reg 8 are to be served on the “proposer”. Where the proposal is made by an agent the invalidity notice must therefore be served on the agent, who is treated as having the authority of the interested person to accept service of such a notice, having already received authority to make the proposal.
When service has to be made on the ratepayer this may cause difficulty if the ratepayer’s agent wishes to receive the notice or a copy. It is VO policy not to issue a courtesy copy of a VO notice of list alteration under Regulation 17(2) to a retained agent, despite a limited time under Regulation 5 in which proposals may be made challenging a VO’s alteration made within 6 months before the end of a list.
Reg 22(1)(a)(ii) provides that a notice may be served by delivering it to the person on whom it is to be served or to any other person authorised by him to act as his agent for the purpose.
This does not oblige the VO to serve documents on a particular person but where an agent wishes the VO notice to be served on him/ her instead of the ratepayer the VO may exercise discretion and serve on the agent instead (but not in addition to) of the ratepayer. However, before doing so the written authority of the ratepayer must first be obtained. The following form of words to be used has been approved by the HMRC Solicitor and should be used-
“I/we are writing to you to authorise…[agent company name….whose normal office address is……] to act as my/our agent in accordance with Regulation 22(1)(a)(ii) of the Non domestic rating (Alteration of Lists and Appeals) (England) [or (Wales)] Regulations 2009 SI 2268 [or WSI 758] to receive any notice required or authorised to be served by the Valuation Officer for the […..Billing Authority], which would otherwise have been served on me/ us as ratepayer, in respect of [property address as above or properties identified in the attached schedule], for the purposes of the 2005 rating list.
This authorisation will remain in place for the duration of the 2005 rating list until such time as I/we notify you that it no longer applies. In the event that [agent company name] are no longer instructed to act on my/our behalf, or the property(ies) identified in this authorisation is/are no longer occupied or owned by me/us, it shall immediately cease to have effect.”
The authorisation must be signed and dated by the ratepayer or company, rather than the agent.
Reg 22(1)(c) provides that a notice may be served by leaving it at or forwarding by post to the usual or last known place of business of the recipient or, in the case of a company, its registered office.
Reg 22(1)(d) provides that service is effected by delivering a notice to some person on the premises to which the notice relates or, if there is no person on the premises to whom it can be delivered, then by fixing it to some conspicuous part of the premises.
Reg 22(1)(e) provides that where a hereditament to which the notice relates is a place of business of the person on whom it is to be served, service is effected by leaving the notice at or forwarding it by post addressed to that person at that place of business.
In the vast majority of instances where it is impossible to serve a notice by post to a hereditament (e.g. an advertising right, a car park or a mast) it is anticipated that the registered office of the occupier will be ascertainable either from information displayed on the hereditament or from the Billing Authority and so service of a notice may be effected by sending to the registered office of the company.
Where it is necessary to serve a notice by means of personal service or by attaching it to the premises, the person designated to do so should personally satisfy themselves that the notice specifically relates to the property in question, place the notice in a window envelope (ensuring the name and address of the addressee is clearly visible) and attach it in a prominent position to the premises.
After service a copy of the notice should be endorsed with the words “Served by hand on [date to be inserted]” or “Affixed to the premises on [date to be inserted]”. The person who served or affixed the notice should then sign and date the copy and print their name and grade below the signature. This document should be retained in case of dispute over correct service.
4.9 Multiple property proposals
Regulation 6(4) allows that a proposal may deal with more than one hereditament only where:
(a) the proposal is seeking to merge several hereditaments into a single unit or, to reconstitute several hereditaments to form a different number of separately rateable hereditaments; or
(b) the person making the proposal does so in the same capacity for each
hereditament, all of which must be within the same building or, if not in a building are within the same curtilage.
4.10 VO not to alter proposals
Proposal forms, or documents purporting to be proposals, are documents with a legal status
4.11 Transfer of proposal to different representative
As soon as caseworkers become aware that a company has gone into liquidation, been taken over or merged into another company they should inform the Central Ops Support team by email.
There are a number of situations where it may be suggested to the VO that a proposal originally submitted by a professional representative (PR “A”) should be resolved by discussion with a different professional representative (PR “B”):
a) Where PR “A” has gone into administration. This can include where a Liquidator or Administrator has been appointed,
b) Where a Company Voluntary Arrangement (CVA) has been entered into so that PR “A” has been wound up and a new company PR”B”, possibly with a similar name, has acquired the business assets.
c) Where PR “B” has acquired the whole business of PR “A” and absorbed it into the existing company of PR “B”. This may be described by both PR companies as a ‘merger’ but is more accurately a takeover.
d) Where PR “A” has ‘merged’ with PR “B” to form a new company PR “C”.
e) Where PR “A” purports to simply transfer the proposal to PR “B” whilst PR “A” remains in existence.
f) Where PR “A” engages PR “B” to deal with the proposal on behalf of PR “A”.
In considering each of the above scenarios it is important to bear in mind the following principles:
-
A proposal can only be made by or on behalf of an Interested Person IP and a professional representative has no rights of their own in relation to the proposal.
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An IP must give consent to the transfer of representation from one PR to another.
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Where an IP instructs a PR company to make a proposal on its behalf, the instructions form a contract between the IP and the PR company.
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Where a PR goes into administration, the Administrator stands in the shoes of the company directors and can do anything the directors could have done.
The table below sets out the options for each of the scenarios in a) – e) above:
| Situation | Discuss with PR “A”? | Discuss with PR “B”? | Discuss with PR “C”? | Contact IP? | |
| a) | Administrator appointed at PR “A” | Yes. The Administrator may continue to run PR “A” | Only with consent of IP. | N/A | If Administrator will not deal with appeal. Send letter VO7271. |
| b) | CVA entered by PR “A” and new company PR “B” formed | No longer exists | Different company so only with consent of IP. Send letter VO7274 to PR “B”. Continue to discuss appeal but do not process settlement until Authority to Act received. | N/A | If no Authority to Act received send letter VO7272 with Optional para 1. |
| c) | PR “A” taken over/merged with PR “B” | No longer exists | Different company so only with consent of IP. Send letter VO7273 to PR “B”. Continue to discuss appeal but do not process settlement until Authority to Act received. | N/A | If no Authority to Act received send letter VO7272 with Optional para 2. |
| d) | PR “A” and PR “B” merge to form new company PR “C” | No longer exists | No longer exists | Different company so only with consent of IP. Send letter VO7273 to PR “C” in respect of clients of both PR “A” and PR “B”. Continue to discuss appeal but do not process settlement until Authority to Act received. | If no Authority to Act received send letter VO7272 with Optional para 3. |
| e) | PR “B” claims to have taken over instructions from PR “A” | Assume that PR “A” refers contact to PR “B”, so N/A. | Different company so only with consent of IP. Send letter VO7275 to PR “B”. Continue to discuss appeal but do not process settlement until Authority to Act received. | N/A | If no Authority to Act received and PR “A” refuses to act. Contact TA for advice. |
| f) | PR “B” claims to have been asked to discuss PR “A” appeals on behalf of PR “A”. | Yes, if possible. | Yes. PR “B” must sign any settlement on behalf of PR “A” | N/A | No. |
Agents seeking to takeover an existing proposal must be in possession of a written Authority To Act (ATA) document provided by the Interested Person. The Agent must provide a copy of the ATA to the VOA when requested.
A valid letter of Authority to Act (ATA) for the purposes of Rating Settlement must be in writing and will need to:-
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Identify the Interested Person and the authorised agent.
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Be signed and dated by the Interested Person ( IP).
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State that the agent is authorised to prosecute and settle rating appeals on behalf of the IP and to take over appeals lodged for the IP by other agents.
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Specify which Rating Lists the ATA applies to.
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Specify which hereditaments the ATA applies to.
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State the duration for which the ATA will be in force.
4.12 Appointment of more than one Professional Representative (Agent)
Where an Interested Person (IP) appoints more than one Professional Representative (PR) to make duplicate proposals in respect of a list entry for the same hereditament, the second proposal received will be invalid (see 3.3.4 above).
However, because the first proposal ‘belongs’ to the IP and not the PR who submitted it, the VO should establish whether the IP intends the first or second PR to act in respect of the valid proposal.
In cases of dispute between the two PR as to who is instructed to act the VO should send VO7276). If the IP confirms that instructions have been transferred to the second PR then the contact details in RSA for the valid proposal should be amended to show the new PR details and case remarks noted. On no account should the second proposal be made valid.
4.13 Professional Representative (Agent) company dissolved or ‘disappears’
Where a Professional Representative (PR) company has been wound up or can no longer be contacted the IP should be sent (either VO7271 or VO7272 as appropriate) to find out whether they wish to deal with the appeal directly or to appoint a different PR.
status. They should not, in any circumstances, be amended or altered by the VO.
4.14 Insolvency of occupier
Where the IP themselves becomes insolvent and enters administration there is no direct action required by the VO in respect of discussion of outstanding proposals/appeals. A PR may continue to represent the IP unless the appointed Administrator removes or transfers instructions, and this applies whether or not the IP continues to occupy the relevant hereditament. Where a new occupier takes occupation of the hereditament they will be a party to the appeal and are a required signatory for any agreement – see see RM section 6 part 6, 3.5.
A new occupier includes a company formed under a Company Voluntary Arrangement (CVA) which may give the appearance of being the same occupier (that is with the same or similar trading style and product branding) but which exists as a different registered company.
VO 7271
VO 7272
VO 7273
VO 7274
VO 7275
4.15 Requests from Agents
Agents may request the VO to treat as invalid any proposals made on behalf of a particular client by another agent. As a uniform approach, VOs should ask that the client writes to the VO to confirm the instructions. The letter should set out the extent of the instruction
4.16 Uninstructed Agents
Where a VO discovers an agent made a proposal ostensibly on behalf of an interested person but without instructions at the time, then this proposal is invalid and will be dealt with in accordance with the guidance set out below. The proposal will be invalid regardless of how it has been registered, if the lack of instruction is discovered later than 4 weeks after receipt then the proposal must be withdrawn by the agent or declared invalid by the VT.
Where VO’s become aware that an agent has attempted to make proposals on several occasions without instruction, this should be reported to Technical Advisers - NSU. Consideration will then be given to whether the particular agent should be asked to supply a copy of client’s instructions when submitting any future proposal.
Where an agent was instructed at the time of making the proposal but later uninstructed, the Occupier or other Interested Party can instruct a new agent to deal with the proposal or act for themselves.
4.17 Proposal received relating to a property not in the VO’s area
General rule
As a general rule, if the property which is the subject of the proposal is not within the VO’s area, it should be returned to the maker with a covering letter VO 7052 (see RM:7:1 Appendix 3) explaining that the proposal has not been properly served, and giving the name and address of the relevant VO to whom it should be sent. First class post should be used.
Exception to rule
An exception to this general rule will arise when a proposal is served on a VO in respect of a property falling within a Billing Authority area for which that VO is no longer responsible as a result of VOA restructuring or a local government boundary change.
Ratepayers or their agents will not necessarily be aware at the time of completing and posting a proposal that the responsibility for the particular Billing Authority area to which the proposal relates has been transferred to another VO from the one shown on previous correspondence or in the local telephone directory.
So as not to disadvantage a ratepayer or agent who, in good faith, has served a proposal on whom he/she believed to be the correct VO, the VO receiving the document should indicate the date of its receipt in that office using the official office date stamp. (The VO receiving the document will, in effect, be acting as agent for the correct VO).
The VO concerned should not carry out any test to determine the validity of the proposal.
After date-stamping the proposal, the VO should immediately forward it, by first class mail, to the VO now having responsibility for the Billing Authority area to which the proposal relates.
At the same time, the person who submitted the proposal should be informed in writing of the action taken. The name, address and telephone number of the office to which the proposal has been sent should be quoted so that the person concerned can make further enquiries to the appropriate VO should the need arise. This letter should not include any statement from which the recipient could claim that it has been accepted as a valid proposal. The question of validity is a matter for the correct VO to decide when it is received in his or her office.
The VO receiving the re-directed proposal should adopt as its date of receipt the date it was received by the first VO, as shown by the official date stamp already impressed on the form.
Offices affected by branch restructuring or a local government boundary change will need to be particularly vigilant when opening post to watch out for proposals which have been re-directed in accordance with these instructions. VOs concerned will need to ensure that such proposals are registered as having been received on the date they were received by the first VO, and not the date subsequently received by the correct VO. In these circumstances, therefore, the VO now responsible for the Billing Authority area concerned should not impress his or her official office date stamp on the proposal because this may subsequently lead to confusion as to the date of its receipt.
These arrangements should be operated for a period of twelve months, beginning with the day responsibility for the Billing Authority area was transferred to the appropriate VO. After that period has expired, any incorrectly served proposal should be returned to the sender with a covering letter giving the name and address of the VO on whom it should properly be served.
4.18 Information to be included on a proposal
General
It is important to distinguish between information that is statutorily required and other information which, although not statutorily required, nevertheless helps to support the proposal.
For example, the official proposal form asks for the name of the Billing Authority, the assessment number and the rateable value shown in the list. These are not statutory requirements. Nevertheless, they help to “identify the property to which the proposal relates”.
The omission of such information will not disqualify a form or a letter from being accepted as a proposal provided the property to which it relates can be identified from the address and, if stated, its description.
Any proposal which fails to meet the statutory requirements in Regulation 6 of SI 2009 No 2268 or SI 2005 No 758 (W.63) for the 2005 and subsequent lists should be treated as invalid.
Important differences between the Regulations: England and Wales
The requirement to state the rent under Regulation 6 (vi) in Wales differs slightly than under Regulation 6 (vii) in England. This is due to an amendment to the English Regulations made by SI 2006 No 2312 which was not adopted by Wales.
This means that in Wales, the rent is not required to be stated for grounds of appeal under Reg 4 (1) j and k;
(j). Not partially domestic or exempt - the list should not show that some part of a hereditament which is shown in the list is domestic property or is exempt but does so.
(k). Merger or reconstitution of hereditaments - property which is shown in the list as more than one hereditament ought to be shown as one or more different hereditaments
This is in addition to the exceptions in England, namely for those proposals seeking; deletion; an address change; a description change or a proposal that a statement required has been omitted.
A further difference is that in England only, a relevant authority, or a former interested party submitting a proposal under grounds c,d or f, do not have to state the rent in the proposal.
If a proposal contains all the information statutorily required and it is served within the appropriate statutory time limit specified in Regulation 5 it should be accepted as valid.
This section should be read in conjunction with the section below relating to validity of proposals.
The statutory requirements for a valid 2010 list proposal are set out in Reg 6
England 2010
The Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009’ (SI 2009/ 2268) (‘Appeal’ Regulations)
Wales 2017
The Non-domestic (Alteration of Lists and Appeals)(Wales) Regulations 2005 [WSI 2005 No.758 (W.63)]
5.1 Statutory requirements (2017 Wales)
(i) Name, address and capacity of maker of proposal [reg 6(1)(a) and (b)]
These should be clearly stated on the proposal. Note that there is no obligation for the form to be signed. If any of this information is not stated the proposal should be treated as invalid.
(ii) Identify the property to which the proposal relates [reg 6(1)(c)]
The address of the property should be shown in box 1 on the proposal form. It may also be necessary to have regard to the description in box 2, especially if there is more than one hereditament at the same address, in order to satisfy the statutory requirement to “identify” the property.
It is emphasised that whilst it should be possible for the VO to positively identify the property to which the proposal is intended to relate with a reasonable degree of certainty, it is not a requirement that the address on the proposal should match exactly with the entry shown in the List. The decision of the Court of Appeal in R v Northamptonshire LVC, ex parte Anglian Water [1991] RA 93 gives some useful guidance.
The following extract from the decision of Nicholls L J at page 101 is useful
“In my view … the adequacy of identification of the subject hereditament on a proposal, …. falls to be determined according to the ordinary principles of construction: how would the proposal reasonably be understood by those on whom the proposal or a copy is to be served? In answering the question, as with all questions of construction, common sense is to be applied plentifully.”
and later in the same paragraph
“The proposal form is itself intended to be adequately definitive of the property affected.”
Any special knowledge of the VO was judged to be irrelevant. In Davey (VO) v O’Kelly [1999] RA 245 the members, Mr Clarke and Mr Francis found on page 254
“We hold that the originating proposal in this appeal is to be construed by reference solely to the wording of that document. We cannot look outside the proposal. We cannot have regard to extrinsic material, that is to say any special knowledge or understanding of the valuation officer …. The test is: how would the proposal reasonably be understood by those on whom it was served, disregarding any extrinsic material.”
Although O’Kelly was dealing with the scope of proposal (see below) rather than identification of the hereditament, it is considered that the principle holds good for all aspects of a proposal. Consequently VOs should follow the guidance from the Court of Appeal in Anglian Water and the Lands Tribunal in O’Kelly and must not rely on their special knowledge as VOs or their office records to supply necessary details which the proposal omits. If the VO is not able to identify the property in question or has serious doubts about its identity, the proposal should be treated as invalid.
If in addition to the address the proposal includes the RV and assessment number and there is any discrepancy between these which raises doubt as to the correct identity of the property appealed against, no assumptions should be made.
The proposal should be treated as invalid. Discrepancies between address, assessment number and RV are most likely to become apparent at input stage at which point the appropriate action must be taken.
(iii) Identify the manner in which the List is proposed to be altered (reg 6(1)(d))
The manner in which the proposer intends the list to be altered should be readily apparent from the proposal.
(iv) Other information (reg 6(1)(e))
Other information to be provided depends on the grounds on which the proposal is made.
(i) The proposal should include a statement of the grounds for making the proposal and,
(ii) in the case of a proposal made on the grounds set out in Regulation 4(1)(a), (c) or (g) to (o) - the proposal should include a statement of the grounds for making the proposal and a statement of the reasons for believing that those grounds exist;
(iii) in the case of a proposal made on the grounds set out in Regulation 4(1)(b) - (a material change in circumstances) - the proposal should include a statement of the nature of the change in question and of the date on which the proposer believes the change occurred;
(iv) in the case of a proposal made on any of the grounds set out in Regulation 4(1)(d) or (f) - (an inaccurate VO list alteration) the proposal should include a statement identifying the alteration in question, whether by reference to the day on which the alteration was made or otherwise;
(v) in the case of a proposal made on the grounds set out in Regulation 4(1)(e) - (a tribunal decision relating to a different hereditament) - the proposal should include the following information:
a) the identity of the hereditament to which the decision relates;
b) the name of the tribunal or court which made the decision;
c) the date of the decision;
d) the reasons for believing that the decision is relevant to the RV or other information to which the proposal relates; and
e) the reasons for believing, in light of the decision, that the RV or other information to which the proposal relates is inaccurate.
(vi) in the case of a proposal made on the grounds set out in Regulation 4(1)(f) - (incorrect effective date) see paragraph 3.3) above - the proposal should include a statement of the day proposed in place of the day shown in the list.
(vii) In the case of a proposal made on the grounds set out in Regulation 4(1)(a) to (g) and (i) to (l), the proposal should include information on the amount payable each year, as at the date of the proposal, in respect of the lease, easement or licence to occupy as required under Regulation 6(3).
Except when the proposal is made by a relevant authority or by a person who was an interested party at the time of a previous amendment or alteration and has reason to believe that a ground set out in paragraph (1) (c), (d) or (f) exists [an inaccurate VO list alteration or amendment to the Rating (Plant and Machinery) (England) Regulations 2000 (b)]
5.2 Other Requirements (2017 Wales)
Occupier’s name and address
The official proposal form asks for the name and address of the occupier (if different from the property address). This request in itself is NOT a statutory requirement.
Nevertheless, it is designed to assist the VO to fulfil the statutory requirement to serve a copy of the proposal on the ratepayer where the proposal has been made by someone other than the ratepayer (Reg 9(1)(a) refers).
In most cases, the omission of this information can be remedied by serving a copy of the proposal on “The Occupier” at the property. Where, however, it is obvious that the occupier’s address cannot be that of the hereditament, and the proposal has been made by another person (an “interested person”), the proposal should first be formally registered. The VO should then ask the proposer to provide the name and address of the occupier as soon as possible to enable a copy of the proposal to be served on that person.
This section should be read in conjunction with the section above dealing with statutory requirements for information to be included in proposals.
For the 2005 List and subsequent lists Regulations 5 allows a proposal to alter a list compiled on or after 1 April 2005 to be made at any time before the day on which the next list is compiled, so before 1 April 2021 for 2017 list proposals.
In addition a proposal on the grounds set out in Regulation 4(1)(d) or (f) [an inaccurate VO list alteration] may be made before the day the next list is compiled or within six months of the date of the alteration, whichever is the later; therefore the latest possible date will be 1 October 2021 for a VO notice served on 1 April 2021.
In respect of Regulation 4(1)(e) [a tribunal decision relating to a different hereditament] these proposals may not be made later than 30 September 2021.
6.1 Legal procedure
Treatment of proposals which the VO regards as invalid is set down in Regulation 8. In such cases an “invalidity notice” must be served on the maker of the proposal - form VO 7048.
A decision on whether or not to serve an invalidity notice on the proposer should be made within 4 weeks of the VO’s receipt of the proposal. An invalidity notice must state the reasons why the VO considers the proposal to be invalid and must advise as to the effect of Regulations 8(6) to 8(9) - see below.
Identification of invalidity after expiry of 4 weeks from receipt
England 2010
If the VO becomes aware that a proposal is in some way defective and therefore invalid after the expiry of 4 weeks, in England it is still possible to serve an invalidity notice, with the consent in writing of the proposer. Provided the original was not invalid because it was made out of time or because it was a duplicate proposal [one bite of the cherry rule] this will allow the opportunity to serve a further proposal to correct any defect in the original. The further proposal must be on the same grounds as the original.
From 1st April 2015 the alteration to the effective date regulations mean that withdrawing and resubmitting a corrected proposal will result in a restricted effective date for the 2010 list.
A re-submitted proposal in response to an invalidity notice correcting the defect in the original proposal will have the same effective date as the original proposal. We will therefore need to follow the process to seek written consent under the NDR regulations in all cases where invalidity is identified after 28 days from receipt.
It is possible to seek written consent to serve an invalidity notice from the maker of the proposal at any time before the VTE has listed the proposal as an appeal for hearing. Once the appeal has been listed for hearing the Valuation Tribunal must be requested to determine validity as a preliminary issue at the hearing.
For the procedure to be adopted when the VO is of the opinion a proposal is invalid, see Procedures Manual.
This is not provided for in the Welsh regulations and validity would have to be argued before the Valuation Tribunal if not accepted as invalid by the proposer and withdrawn.
6.2 Reasons for invalidity
A proposal will normally be classified as invalid where:-
(a) it is made by a person who is not entitled to make the proposal in question (ie. he/she is not an “interested person” as defined in the regulations) or
(b) it is served on the VO after the statutory time limit has expired, if any such time limit is specified in the regulations or
(c) the proposal does not contain all the information statutorily required or
(d) lack of a causal link in proposals made citing a tribunal decision
(e) it duplicates the grounds of a previously validly made proposal lodged by or on behalf of the same interested person with the same effective date.
6.3 Withdrawal of invalidity notice by VO
Where a VO has served an invalidity notice in accordance with Regulation 8(1) he may at any time withdraw it by serving notice in writing on the proposer. If the proposer has already lodged an appeal against the invalidity notice (see below) the appeal is automatically treated as having been withdrawn.
6.4 Responses to invalidity notice
Within 4 weeks of service of the VO’s invalidity notice (unless the VO withdraws it) the proposer may serve on the VO either:-
a) a further proposal in relation to the same hereditament to replace the initial, invalid proposal. If between serving the invalid proposal and serving the further proposal any period in which a valid proposal was to be served under Regulation 5 has expired, the further proposal will be regarded as having been made within the allowed time period - Regulation 8(6)(a).
Or,
b) if the maker of the proposal disagreed with the VO as to the invalidity of the proposal, appeal against the invalidity notice to the relevant valuation tribunal by serving a notice of disagreement with the VO’s notice of invalidity - form VO 7044.
It should be noted, however, that if the initial (invalid) proposal is already out of time no further proposal as described above may be made.
Similarly, if the further proposal made under Regulation 8(6)(a) is itself invalid then the proposer may not make a new proposal in response to the VO’s notice of invalidity - Regulation 8(7)(b) refers. There is only one opportunity to make a new proposal to correct the reason for invalidity.
Additionally, it should be noted that service of a further proposal under Reg 8(6)(a) does not affect the material day of the proposal. Both material day and effective date fall to be determined by reference to the date of service of the substitute original proposal.
6.5 Service of a further proposal
If a proposer opts to serve a further proposal under Regulation 8(6)(a), the original proposal (which the VO regarded as being invalid) is treated as having been withdrawn - Regulation 8(8).
The further proposal must be received by the VO within four weeks (28 calendar days) of the date of service of the invalidity notice. The date of service of that notice is to be assumed to be the fourth working day after posting where second class mail is used. “Working days” are Monday to Friday, excluding any Bank Holidays. Saturday does not count as a working day.
If a fresh proposal is served on the VO after the four weeks’ time limit has expired it will be treated as unrelated to the earlier invalid proposal and will not benefit from the provisions of Reg 8(6)(a) mentioned in paragraph 6.5(a) above.
If it is suggested that the date of service of the VO’s Notice of Invalidity was actually later than that calculated by the VO and that as a consequence, the fresh proposal served on the VO is in fact within the 28 day time limit, details should be submitted to CEO via the Technical Adviser.
6.6 Notice of Disagreement
Where the maker of the invalid proposal decides to appeal against the VO’s decision the “Notice of Disagreement”, VO 7044 or equivalent, must be served on the VO within four weeks (28 calendar days) of the date of service of the VO’s invalidity notice. (The date of service of that notice is assumed to be the fourth working day after posting).
Where, within four weeks of the service of a Regulation 8(1) invalidity notice, a “Notice of Disagreement” (VO 7044) is received by the VO appealing against the invalidity notice and, having re-examined the facts, the VO then decides to treat the original proposal as validly made, a letter (VO 7313) to this effect should be sent to the maker of the invalid proposal withdrawing the Invalidity Notice.
6.7 Transmission to Clerk to VT
Unless the VO withdraws the Regulation 8(1) notice within four weeks of service of the notice of disagreement, he or she must transmit to the Clerk to the VT notification of:-
a) the entry in the list (if any) which it is proposed to alter,
b) the grounds on which the proposal was made, and
c) the reasons for his opinion that the proposal has not been validly made.
6.8 Proposal subsequently regarded by VO as valid
Where a Notice of Disagreement has been transmitted as an appeal to the VT, Regulation 8(5) provides that the VO may still withdraw the invalidity notice if a re-examination of the facts results in a revision of the opinion that the proposal was invalid and should after all be treated as a valid proposal. In such circumstances a letter (VO 7313) to this effect should be sent to the maker of the invalid proposal withdrawing the Invalidity Notice.
The Clerk to the VT must also be notified of the withdrawal of the Invalidity Notice as required by Reg 8 (11).
6.9 Suspension of operation of Regulations 9-13
Once the VO has served a notice of invalidity under Regulation 8(1), until the invalidity issue is finally decided, Regulations 9-13 (service of copy proposals, withdrawal, settlement or reference to the VT) do not apply – Reg 8(14).
If it is finally decided that the proposal is valid, Regulations 9-13 will apply as if the proposal had been served on the VO on the date of that final decision. For this purpose the date of the final decision under Regulation 8(15) is –
(a) the date the Invalidity Notice is withdrawn; or
(b) the VT having determined the appeal, the date on which the period for appeal from the VT to the Lands Tribunal expires (28 days) if no such appeal is made; or
(c) the date the Lands Tribunal determines the appeal.
6.10 Validity as an issue at VT
Regulation 8(16) provides that nothing done under Regulation 8 shall prevent any party to an appeal to the VT under Regulation 13 contending that the proposal to which that appeal relates is invalid.
It will sometimes be the case that a proposal was not identified as being invalid when served on the VO and as a consequence, no invalidity notice has been served. This does not preclude the VO raising the question of validity after the four week period in which an invalidity notice should have been served.
If the VO becomes aware of a proposal, the validity of which is questionable but no notice under Regulation 8(1) has been served before listing of the appeal by the valuation tribunal, both the ratepayer or agent and the valuation tribunal should be advised that it is intended to raise validity as an issue at valuation tribunal. Invalidity should then be taken as a preliminary issue at tribunal.
If the tribunal do not uphold the VO’s contention as to invalidity then under Regulation 33 of The Valuation Tribunal for England (Council Tax and Rating Appeals) (Procedure) Regulations 2009 SI 2009 No. 2269 the tribunal may not immediately go on to hear and determine the substantive appeal unless all parties agree.
Under normal circumstances the VO should decline such consent.
In summary, where proposals exist which in the view of the VO are invalid, whether or not the Regulation 8 procedure has been triggered, the validity issue should be argued at VT. This will either be in accordance with Regulation 8 or, if Regulation 8 has not been used, by arguing invalidity as a preliminary issue under Regulation 33 of SI 2009 No. 2269.
6.11 Late identification of invalidity by the VO
The need to identify invalid proposals at an early date and then to apply the Regulation 8 procedures cannot be over stated. However, there are some circumstances where invalidity is not apparent purely from the information included in the proposal. In such cases invalidity has of necessity to be raised at a later date.
The revised procedures introduced for 2005 and subsequent rating lists permit service of notice of invalidity outside the initial 4- week period from receipt with the written consent of the proposer. Guidance on the approach is provided in the NDR Procedures Manual IPP Registration Procedures.
Once an appeal has been listed for a hearing of the valuation tribunal, it is not possible to serve an invalidity notice, but it is still possible to raise the invalidity issue as a preliminary matter at the hearing.
The case of Mainstream Ventures Limited v Woolway (VO) [2000] RA 395 identified two different situations in this context. These are:-
(a) where a VO has not served an invalidity notice because there is no reason to suppose that the proposal is invalid since it appears to satisfy all the statutory requirements for a valid proposal but new information is later discovered suggesting that the proposal is invalid
(b) where, on a proper consideration of the proposal, it does not satisfy all the statutory requirements for a valid proposal but it has not been identified as such and therefore the Regulation 8 procedure has not been adopted. Nor has validity been raised at a valuation tribunal hearing.
In case (a) the President of the Lands Tribunal considered that the validity question can properly be argued at a substantive hearing.
In case (b), whilst the president considered that a VO could raise the validity issue before the Lands Tribunal he did observe that
“Unless a valuation officer follows the invalidity notice procedure he may be at risk of a finding that the appeal has proceeded on the basis of a common assumption that the proposal is valid and that it would be unconscionable for him to argue at this particular stage that it is invalid. I do not think, however, that an estoppel can arise where, as here, the invalidity consists of the absence of any power on the part of the proposer to make a proposal”.
In the Mainstream Ventures case the maker of the proposal did not satisfy the requirement of being an interested person and so, notwithstanding the VO’s failure to raise validity at an earlier date or to raise it in valuation tribunal, the Lands Tribunal found in favour of the valuation officer’s contention of invalidity, the president saying
“The provision as to who may make a proposal, creating as it does substantive statutory rights and duties, is not in my judgment capable of being overridden by the conduct of those who may have an interest in the proceedings that have been set in train by a proposal.”
The implication is that where the maker of the proposal has the power to make it (ie. he is an interested person), the proposal on the face of it does not satisfy the statutory requirements for a valid proposal but the valuation officer has failed to recognise this and raise it as an issue until the substantive Lands Tribunal hearing, there is a likelihood that the invalidity argument will not be upheld.
In a similar case, albeit under the Council Tax legislation, the High Court determined that where a proposal had been made outside the time limit specified in the regulations, even though invalidity had not been argued by the Listing Officer at valuation tribunal, the High Court had no jurisdiction to hear an appeal – see Scrivener v Wojcik (LO) and Rochford District Council [2001] RVR 273.
Turner J held (page 249) that
*“the [valuation] tribunal had no jurisdiction to entertain the appeal and there is no jurisdiction whether by agreement …. or by estoppel ….”
These cases emphasise the need for validity to be considered at all stages of the appeal process and not just at initial receipt.
6.12 Further guidance on late identification of invalidity arising from the Upper Tribunal decision Kendrick v Mayday Optical (2014) RA
In April 2012 the President of the Valuation Tribunal, Professor Graham Zellick, considered the validity of two proposals containing inaccurate rental information. The default was recognised by Valuation Officer sometime after their initial receipt.
In his first judgement (Imperial Tobacco) the President undertook an overview of the legislation and provided a number of helpful observations.
The President noted that Regulation 8(1) states that where the VO is of the opinion that a proposal has not been validly made, the VO may serve an invalidity notice. This indicates that the VO has discretion in the manner he treated proposals and in his view if the errors or omissions were insignificant or trivial they should have no impact on a proposals validity.
He then went on to identify four different situations involving a departure from the regulatory requirements; and although the VO was able to challenge invalidity outside the Regulation 8 process in his opinion there was only two categories where a challenge of this nature should be successful.
The first category is where errors or omissions of substance impair the VO’s ability to consider the appellant’s case and which may cause an adverse impact on an assessment of the correct RV. It was this criterion which was closely examined by the Professor in the Imperial Tobacco case and the subsequent Mayday Optical case. In both cases the issue presented was whether the inaccurate rental detail should result in the proposals being treated as invalid. The President considered that the test encapsulated two questions:
(a) Has there been substantial compliance?
(b) Has it caused the VO any prejudice?
When he applied this reasoning to the facts of the cases before him the President decided that both the Imperial Tobacco and Mayday Optical proposals should be treated as valid.
The rent on the Imperial Tobacco hereditament was derived from a ground lease and had no relevance to the rateable value. Consequently it was hard to say the VO had been prejudiced by the inaccurate information provided on the proposal form. In the Mayday Optical case the rent was stated on the proposal to be £9,500, and this was held by the President to be an error in light of the FOR evidence that stated the rent passing as being £10,000 per annum.
Nevertheless applying his own criteria the President held that the proposal should be treated as invalid. The VO appealed this decision and it was eventually overturned by the Upper Tribunal as reported in Kendrick v Mayday Optical (2014) RA …. Counsel for the VO sought for the purpose of the appeal that the Upper Tribunal should proceed on the basis of the President’s analysis but contended that he had wrongly applied his own tests in finding the proposal was valid.
The Judge agreed with counsel’s submission that the 5% discrepancy in the rental declared was significant and this did not comply with the requirements of the legislation and further the VO was likely to be prejudiced by the error as this could lead to an under assessment of the subject property and potentially others like it. According on appeal the proposal was declared invalid.
The second category involve in the words of the President
“errors or omissions so fundamental that the proposal cannot in any circumstances be treated as valid…In this category, the VO has no alternative but to pronounce the proposal (in his opinion) invalid; and should such a proposal come before the Tribunal, whether on appeal against an invalidity notice or otherwise, the Tribunal, whatever stance taken by the VO, would have to declare the proposal invalid and either uphold the invalidity notice or strike out the appeal on the basis that the Tribunal had no jurisdiction to entertain it.”
In order to illustrate the point the President made reference to two case precedents: R v Northamptonshire LVC, ex parte Anglian Water Authority a Court of Appeal decision which dealt with the requirement to properly identify the property to which the proposal relates, and Mainstream Ventures v Woolway in which the proposer was not qualified to make a proposal as he was not the occupier.
Another case that illustrates a fatally flawed proposal is Esau Brothers v Rodd (1992) RA 257, in which case a proposal was served outside the time limits set by the legislation.
The President also drew attention to the comment of the President of the Lands Tribunal in Tuplin (VO) v Focus (2009) RA 226 in which the Valuation Officer’s late claim that a proposal was invalid due to an absence of causal link was rejected. In this case the failure to serve an invalidity notice deprived the appellant of making good the deficiency by serving a further proposal because of the intervening closure of the list. In these circumstances the failure to serve an invalidity notice within the prescribed period may be a good indication that the proposal was not invalid.
In summary then the Valuation Officer is able to challenge the validity of a proposal outside of the provisions of Regulation 8 but the circumstances in which this can be done are restricted to those detailed above. Each situation has to be considered on its own merits and it is recommended that if you have any doubt then you should contact your Technical Adviser who will assist you in following the correct approach.
6.13 Validity and proposals citing tribunal decisions - causal link
Regulation 4(1)(e) provides a proposal may be made to alter a list on grounds citing a tribunal decision in respect of a different hereditament. The wording of Regulation 4(1)(e) includes the phrase “…. by reason of a decision ….”. This implies that the decision of the tribunal has led to the opinion being formed that the list entry in respect of the hereditament on which the proposal is submitted is inaccurate. In other words, there should be a causal link between the decision and forming the opinion that the list entry on another hereditament is wrong.
This interpretation was upheld in the Lands Tribunal decision in Downing (VO) v Corby Power Ltd [1997] RA 60. Note that the RA report erroneously names the VO as “Canning”.
The case involved a proposal made under Reg 4 (4)(b) of SI 1993 No. 291 which has been superseded by Reg 4A (1)(d) but the then requirements for a valid proposal are still relevant in connection with there needing to be a causal link between the VT decision cited and the opinion that the assessment on the appeal hereditament is incorrect.
Reg 4(4)(b) provided for a proposal to be made if a Billing Authority or interested person “is of the opinion that by reason of - …(b) a decision of a valuation tribunal …. the rateable value or other information shown in the list for any hereditament is wrong ..”
In Corby Power the appeal hereditament was a power station and was formula rated by reference to its potential output. The maker of the proposal cited a tribunal decision relating to a shop as grounds for the proposal. The proposer did not pretend that the decision in the case of the earlier proposal had any relevance to his proposal to reduce the assessment on the Corby power station, nor did he suggest that he had formed the opinion that the assessment on the power station was incorrect by reason of the decision in the earlier case. In light of this evidence, it was clear that in making the proposal the proposer had not formed the opinion that the assessment of the power station was incorrect by reason of the earlier decision, which he had not read, and which if he had read, would not have assisted in forming the opinion that the power station was incorrectly assessed. In the Tribunal’s view no experienced valuer could have formed that opinion on the basis of the decision relating to the shop.
The President agreed with the submission for the VO, that the formation of the requisite opinion is a condition precedent to making a valid proposal, and concluded by saying that in his judgement the proposal made in this case was not validly made.
It may not always be apparent from consideration of the proposal by itself whether there is a causal link. This may only become evident once the merits of the proposal are under consideration. If the VO forms the opinion that there is no causal link then, even though all the statutory information required for a valid proposal has been included, validity can still be challenged.
It should be noted that if the cited decision is not a reasoned decision but one merely confirming what has provisionally been agreed between the valuation officer and ratepayer or agent, it is considered that the requirement to form an opinion that a list entry is incorrect “…. by reason of a decision …” is not satisfied.
Unless the cited decision explains why the particular decision was reached it is submitted that it cannot form the basis for concluding that the assessment of any other hereditament is incorrect. Consequently, there will be no causal link between the decision and the proposal served citing the decision. It can however be argued that an ‘unreasoned’ decision may support a proposal where the result of the agreement confirmed by the tribunal is sufficient to make it clear that the rateable value of the interested person’s hereditament is wrong, particularly if the two properties are very similar. The argument loses its force as the characteristics and/or localities of the two hereditaments diverge.
In Tuplin (VO) v Focus (2009) RA 226 although the VO’s invalidity point was rejected the door was left open by the President to the VO arguing that the proposal was in the alternative without grounds as there was no causal link between the case cited and the opinion that the RV of the subject was inaccurate.
In cases of doubt advice should be sought from the Technical Adviser to whom a copy the proposal should be provided. Since the burden of proving invalidity falls upon the VO, invalidity notices should therefore only be reserved for the most obvious cases.
6.14 Operational procedures
Operational procedures relating to proposals considered to be invalid are dealt with in Procedures manual.
7.1 Service
Regulation 9(1) requires the VO within six weeks to serve a copy of any proposals served on him on the following persons or bodies if they are not themselves the maker of the proposal -
a) the ratepayer in relation to the hereditament to which the proposal relates; and
b) the relevant authority (defined in Regulation 2(1) as “the authority in whose area the hereditament is situated”), where that authority
(i) is a special authority, or
(ii) has served notice on the VO that it wishes to receive a copy of a class or classes of proposal, and the proposal falls within any such class.
The City of London is a special authority for the purposes of this regulation and will require a copy of every proposal.
“Special authority” is defined in s 144(6) LGFA 1988.
If an agent contends that the copy proposal required under Reg 9(1)(a) should be sent to them rather than the ratepayer.
Billing authority rights under regulation 9(1) are covered in more detail in RM 1:4:7.
Circumstances where early inspections are required
Proposals requiring prompt action
In addition to the general requirement for VOs to deal with proposals as soon as possible, proposals referring to situations:
-
of a temporary nature; or
-
of which the effects are temporary;
-
or where hardship is claimed
must be singled out for an early inspection. Letters in a similar vein, not necessarily yet classified as proposals, should be treated with the same degree of urgency.