Part 8C: Challenge stage

The Valuation Office Agency's (VOA) technical manual for the rating of business (non-domestic) property.

4. PROPOSALS (Reg 4 & 6)

The grounds for making proposals have not changed between rating lists. However, more detailed information is mandated (by Regulation 8) when submitting a proposal under Challenge in order for it to be accepted as complete. This is a significant difference to pre 2017 requirements regarding incomplete proposals.

4.1 Completion of check first

A proposal cannot be submitted until the Check stage has been completed (Reg 4E) or deemed completed under Reg 4F(3) (the elapse of 12 months from the date of confirmation of Check with no notice of decision being issued) or under Reg 4AA(2)) (in relation to deemed checks on historic entries)

Care should be taken when viewing a proposal that the correct grounds for challenge have been made especially where changes have been made to the rating list at check.

For example, where a check was made in relation to the compiled list figure and the VO has consequently amended the list - the proposer should then be clear in his proposal if he is challenging the original list figure or the VO notice, and must select the correct grounds, submitting relevant evidence to that ground. If there is any confusion or ambiguity then see 5.2 below.

4.2 Proposals - time limits

A proposal must be submitted within 4 months of the date of completion of a check relating to the proposal, (i.e. steps in Reg 4A-F have been completed).

However, there is an exception, under Reg 6A(2), regarding external MCCs relating to proposals for changes on the grounds of:-

LGFA 88 Schedule 6 para 7(d), changes in the locality

LGFA 88 Schedule 6 para 7(e), changes in the mode and category of properties in the locality.

In these exceptions the period for submission of a proposal is extended to 16 months from the date of receipt of the confirmation of check (Reg 6A(2)).

Subsequently, if a decision notice has not been issued by 18 months from the date of receipt of proposal the proposer can then go on to make an appeal to the VTE as the 4 month appeal window is triggered.

4.3 Evidence

For the 2017 and subsequent lists the proposer is required to submit all the evidence on which they intend to rely, along with a statement explaining how that evidence has lead them to their valuation, at the start of the Challenge process (Reg 6). The proposer may submit further evidence in reply to the VO initial response or if the evidence could not have been reasonably known and obtained before the proposal was submitted.

Submission of further evidence later in the process at Appeal stage may only be made in specific limited circumstances if at all (Reg 17A, Procedure Regulations SI 2009/2269). So the caseworker should be aware of this when initially responding with information, including rental evidence, during the Challenge process.

Consequently, if it is appropriate for the VO to issue an initial response, then the response should contain comprehensive evidence to support the basis of valuation adopted and the issues raised by the IP, e.g. 5-6 rents. This will help to avoid issues of admittance of additional evidence later at an appeal hearing.

Note. The VO initial response should have regard to the fact that this evidence is potentially all that may be referred to at any later hearing and should cover all the required evidence that the VO would wish to rely on.

4.4 Use of rental evidence

If rental evidence is referred to in the initial response, the proposer should be informed of their rights to view FORs and ensure full compliance with the requirements of Reg 17 (SI 2009/2269), before any Decision Notice is issued.

For further details on rental evidence and Reg 17 SI 2009/2269 regarding the notification of rents and the parties’ rights to view FORs etc. please see Rating Manual, Section 8.

ON NO ACCOUNT CAN A COPY OF THE FOR/RALD BE PROVIDED TO THE RATEPAYER OR AGENT.

4.5 Standard of Proof

The standard of proof for the proposal to succeed is to demonstrate that the Rateable Value (RV) in the rating list is unreasonable (Reg 13A(2)).

4.6 Incomplete Proposal

For 2017 invalidity procedures do not apply. However, if a proposal does not contain all the requisite information then it must be made incomplete and returned to the proposer.

A proposal may be made incomplete up to the point a Decision notice is issued.

There is no right of appeal against the decision to make a proposal incomplete but a further proposal may be submitted provided it falls within the time limits for submission (Reg 8(3)).

Caseworkers should review the case papers on receipt to ensure that the proposal is a complete one and if not refer to the incomplete proposal procedures below (Section 5).

Checks for completeness should also include

ensuring that the Proposer is entitled to make the proposal
explanation of how the grounds are applicable
reasoning as to how the evidence supports the grounds raised
that the proposal is lawful
the correct time limits have been complied with
rental details have been supplied with as required by the Reg 6(6)
if the grounds cite a Tribunal or court decision Reg 6(5) has been fully complied with

See Appendix 2 for further details on incomplete proposals

4.7 Penalties

The VOA may impose a penalty on an IP or former IP at Challenge if they knowingly, recklessly or carelessly provide information which is false in a material particular. i.e. the details of the proposal.

Any information supplied to the VOA as part of the Check related to the Challenge, or at any stage during the Challenge, can be subject to a penalty (see Penalties (Reg 9) for further information).

4.8 Making Proposals

Only interested persons (IPs) or a person who was an interested person (within the meaning in the 2009 Regulations at the time the check of information was initiated, but is no longer an interested person in relation to that hereditament), may make proposals. (Reg 4 (2)).

Essentially, there are three scenarios regarding the IP and when proposals may be made:

1) Under Reg 4 (2) (a) (as amended)

an IP is someone who is a tenant or has a right to an interest in the property and they can make a proposal under any grounds (Reg 4(1)).

2) Under Reg 4(2) (aa)

if they are a former IP and submitted a check whist they had an interest in the property but have now left they can also make proposals under any grounds under Reg 4(1)

3) Under Reg 4(2)(c)

anyone who was a IP and left the property before they made a request for information during check can only make a proposal under restricted grounds, i.e. Reg 1(c) (d) or (f). These grounds are:

(d) the RV is inaccurate due to a VO alteration,

(f) the effective date of the VO alteration is wrong.

Therefore if a party left the property before the request for information at the start of a check Reg 4(2)(c) applies - which means they cannot make a compiled list proposal but they can make proposals against relevant VO alterations that applied whilst they were in occupation.

This means that essentially there are 3 types proposer depending on whether they are an IP or former IP (and when they became a former IP)

1) An IP (i.e. has a current interest in the property) can make a proposal on all 10 grounds (a - o) (reg 4(2)(a)

2) A former IP who was there at the date of check request but has since left the property (for the period in which they were an IP) – all 10 grounds (a-o) (reg 4(2)(aa)

3) A former IP who was not there at the date of check request – is restricted to the 3 grounds and only for the period in which he was an IP.(reg 4(2)(c))

For properties where the valuation is held off system the check request for information (DVR) is the critical date for determining if they fall under 2 or 3 – and this will be before the confirmation of check (which can now be via the portal)

If it is a bulk class property and the valuation is on the internet – the check request and confirmation are deemed to happen simultaneously

If at the date of check request they were not an IP in the property as they had already left - they they can only make a proposal under 4(1)((c) P&M – (d) VON – (f) ED. They cannot make a compiled list, MCC or proposals for splits mergers etc these would be unlawful

So whilst they can make a check they cannot submit a proposal to challenge the compiled list

N.B. this does not preclude the VO from ensuring that the list is accurate and if there is an error that needs to be amended the VO should consider issuing a VON to amend the list.

Maker of proposal (IP) has to be the same as the maker of the check

The person making the proposal must be the same person who submitted the check on the property.

Reg 6(1) requires a proposal to be made within 4 months of the completion of a check on the hereditament.

This, regulation however, has to be read in conjunction with the requirements of Regulation 4A & B.

Reg 4A(1) requires that a person may not make a proposal unless a check is completed. Completion is either by the service of a Notice of completion / decision, or by 12 months elapsing from the date of submission of the proposal and no such notice being served.

Reg 4A

[(1) A person may not make a proposal in relation to a hereditament unless a check of information about the hereditament has been completed (“a check”).

Reg 4B goes on to require that ‘the person’ (i.e. IP or former IP) before making a proposal must make a request to the VO for information and then confirm the information exchanged, i.e. enter into the check process.

Reg 4B

[(1) This regulation applies to a person mentioned in [regulation 4(2)(a) or (c)].

(2) Before making a proposal in relation to a hereditament, the person must request from the VO information which the VO holds about the hereditament.

Therefore, the maker of the proposal has to be the same person who submitted and confirmed the check in order to be lawful.

4.9 Billing Authority rights

Billing Authorities do not have the right to make Proposals or Appeals or be party to a Proposal or Appeal unless they qualify as an interested person and have an interest in the property.

However the VO is still required to notify the Relevant Authority on receipt of the proposal and the determination of the proposal (Reg 9(4)) and provide certain information regarding the proposal. This is usually done by VO weekly schedules.

During Challenge, having received notification of the proposal the Relevant Authority may provide the VO with additional information for consideration. The VO must then provide this to the Proposer who can provide further evidence in response (Reg 9(6)).

As the BA cannot now make a proposal, the VO should involve the BA at an early stage and obtain all relevant evidence from them. This will be especially important in the case of deletions or large reductions following decisions in recent UT cases on Canary Wharf (repair), completion notices, exemptions and borderline CT/NDR cases e.g. scenarios involving property guardians.

In the case of Proposals for deletion (Reg 4(1)(h)) relating to the validity of a Completion Notices, the BA cannot be a party to the Challenge, unless it is a property for which they are actually an interested or former interested party. The VO should seek evidence from the BA in relation to the completion notice at an early stage of challenge and must then provide a copy of that evidence to the Proposer. The evidence would be included in any initial response and decision notice. Should the case then be appealed the VO could then call the BA as a witness at any later VT hearing.

Reg 11(2) SI 2009/2269 allows the VTE to give a direction to add a person as a party,. However, As the BA is not a party whose signature is required under Reg 12, they cannot be made party to an appeal unless they are the actual occupier of owner.

4.10 Timing submission & MCCs

Proposals may only be made within 4 months of the date of completion of the check (Reg 6) (or as extended under reg 8(4) when it has been made incomplete).

Proposals made in respect of external MCCs may be made up to 16 months from the date of confirmation of check (Reg 6A).

Only one Challenge can be made for each MCC affecting a property (Reg 6A (3))

If a Challenge for a material change of circumstances is not made within the relevant time limit, then a Challenge cannot be made for that MCC (Reg 6A(5)) (4 months from date of completion of check for an internal MCC or 16 months from confirmation of check for proposals relating to external MCCs (the latter relating to MCCs under para 2(7)(d) or (d) of Schedule 6 LGFA 1988)).

Changes made at check for an MCC

Where a proposal is made where the VO has reduced an RV for an MCC by a notice of list alteration at check, and the proposer disagrees, the proposer may make a proposal against the list alteration (reg 4(1)(d) or as a MCC proposal (Reg 4(1)(b)). In the case of a 4(1)(d) proposal the time for submission is 4 months from date of completion of check.

4.11 Historic Assessments

A proposal may be made against an historic assessment by an IP where appropriate. However, the valuation and survey data attached to check, on the VOA website, shows the current list entry. The IP should have advised the VO if an historic assessment is being challenged. Caseworkers should therefore check that the correct valuation and survey data is linked to the case and the correct facts are agreed for the material date.

See also RM section 6 Part 5B - where proposals may need re-linking following later amendments to the rating list which take effect before the Material Day of the subject proposal.

4.12 Multiple Grounds of proposal

A Challenge cannot be made on more than one ground unless the grounds have the same Material and Effective Date (Reg 6A(4)).

4.13 Multiple properties on a proposal

Proposals can only relate to more than one property where:

a) the ground for the Challenge is that the properties have been divided or combined;

b) the IP or former IP is connected to all the properties in the same way and all the properties are in the same building or built within the same area of land (Reg 6(7)).

4.14 Grounds for making Proposals (Reg 4, SI 2107/2268)

The grounds on which an Interested Person may make a proposal are set out in Regulation 4(1), These grounds have not changed between the rating lists and these are:

a) compiled list inaccuracies

b) the RV is inaccurate due to an MCC on or after compilation day

c) the RV is inaccurate by reason of amendment to the Plant & Machinery (P&M) Regs (Valuation for Rating (P&M) (England) Regulations 2000),

d) an alteration of the list by the VO is inaccurate

e) the RV is inaccurate by reason of a VTE, VT, Lands or Upper Tribunal or court decision

f) the Effective Date is incorrect

g) the hereditament should be shown in the list

h) the hereditament should not be shown in the list

i) the list should show that some part of the hereditament is domestic or exempt and does not do so

j) the list should not show that some part of the hereditament is domestic or exempt and does so

k) the property is shown as more than one hereditament and ought to be should be shown as one or more different hereditaments

l) the property is shown as one hereditament and ought to be shown as more than one hereditament

m) the address is wrong

n) the description is wrong

o) any statement about the hereditament under s42 of the Act has been omitted.

Former IPs

Any other person who is not an IP, but who was an IP at any time during the time in which a list alteration had effect, may only make a proposal on the grounds of a VO alteration, amendment to P&M or effective date (grounds 1(c), (d) or (f) (Reg 4(2)).

4.15 GROUNDS OF PROPOSAL - Interpretation

see also RM Section 7: Proposals, part 2 - Interpretation of the Grounds of Proposal

The main grounds of proposal commonly used are commented on below.

(a) Compiled List Proposals (Reg 4(1)(a))

A “compiled list proposal” [RSA code of grounds “01”] is one made on ground 4(1)(a):”the rateable value shown in the list for a hereditament was inaccurate on the day the list was compiled;”

The important thing to note from this is that the Rateable Value being appealed is that which appeared in the list ON 1 April 2017 (or 1 April 2010 for the previous list). It does NOT refer to any rateable value subsequently entered into the list, regardless of the effective date appearing in the list.

For example: an assessment which was created by a VON on 1 June 2017 but with an effective date of 1 April 2017 is not the compiled list entry and must not be linked to an “01” proposal.

(b) Material Change of Circumstances (MCC) proposals Reg 4(1)(b)

In order to make an MCC proposal, there must be a material change that falls under at least one of the matters set out in LGFA 1988 Schedule 6 para 2(7) and as a result of that change the rateable value in the list is inaccurate and the change actually occurred on or after the compilation date.

If the change, constitutes a matter under para 2(7), but the event occurred before the start of the Rating List coming into force, e.g. 1 April 2017, then the proposal should be made under the grounds of Reg 4(1)(a), a compiled list error and not for an MCC under Reg 4(1)(b). If such an MCC proposal is submitted it would be unlawful.

For example

A check is submitted/confirmed in February 2023 and a new list comes into force from 1 April 2023. The Material Day for challenge on MCC grounds is the date of confirmation of check. As this date is prior to the compiled list date no MCC proposal may be made, it would be unlawful. However, if the MCC continued past the start of the list then a compiled list proposal could be made. An MCC proposal on the 2023 list can only be made in respect of a check submitted on or after 1 April 2023.

(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.

If the VO alteration did not alter the rateable value previously shown in the list then the proposer may not make an appeal under this ground. This ground is only applicable if the RV has been changed.

No proposal under this provision may be made on this ground if

it is against a previous list alteration made as a result of a previous proposal (made by any person) relating to the hereditament or
to the decision by the Valuation Tribunal, the Upper Tribunal or a court determining an appeal or application for a review from either tribunal (Reg 4(3)(c) refers)

(e) Tribunal Decisions

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.

Tribunal or Court decisions** must be final before a proposal can be served**

Proposals may only be made citing a tribunal decision once the decision is handed down.

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).

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 as there needs 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 complete proposal has been included, the proposal can still be made incomplete.

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 IP 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 then 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.

Tuplin (VO) v Focus (2009) RA 226

In this case, 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.

(f) Deletions

It has been held by the Tribunals that the validity of the issue of a completion notice may be challenged by way of a proposal for deletion on the basis that the property has been wrongly included in the Rating List. See VT decision 246525454856/538N Gnd Flr The Horizon 99 Burleys Way Leicester LE1 3BE.

(h) Insertion of new hereditament in the list

If a property is required to be shown in the list and there is no current list entry the proposer may request insertion into the list. As there is no entry in the list the IP will not be able to enter into the property linking process and should contact the VO customer service centre for assistance.

(n) Description in the list

The purpose of the description in the list is to be able to identify the hereditament vacant and to let it is not necessarily to describe the particular type of business within the hereditament.

(o) Statements about the hereditament

This includes those statements about the property being wholly domestic, composite, exempt or part exempt or such information as prescribed by the Secretary of State by regulations.

Requesting other changes to the Rating list

Reg 6(8)

This 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.

e.g. 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 amend the effective date to a later date, 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.

4.16 Particulars of the grounds

The grounds establish what the proposal seeks to correct in the list. The particulars of the grounds are the detailed reasons as to why the list is inaccurate (Reg 6(4)(b))

4.17 Restrictions on making proposals - Unlawful proposals

See Appendix 2 for more details

A proposal can only be made on more than one ground if the Material Day and Effective dates are the same for all grounds mentioned (Reg 4 (3)(a)).

‘One bite of the cherry rule’

An IP cannot make a proposal where one has already been made by that person (or someone with a qualifying connection) on the same grounds arising from the same event in respect of the same hereditament (Reg 4(3)(b)(i)).

Proposals are considered to be the same if:

the IP or former IP makes both challenges on the basis of having the same link to the property;
they are against the same list;
they concern the same property;
the grounds for both Proposals are the same; and
the Proposals are made for the same event.

‘Event’ means the compilation of the list, MCC or alteration of the List by the VO.(Reg 4(4))

A proposal cannot be submitted, where a proposal on the same facts has been made by another IP or former IP and considered and determined by a VT, VTE or Upper Tribunal (Reg 4(3)(b)(ii)). (This would include the scenario where a challenge is withdrawn and then the VO alters the list in response to the proposal, provided that there is an email trail to show the connection between the withdrawal of the proposal and the VO serving a notice based on the facts in that proposal).

No proposal may be made where it is against the list alteration made by the VO following a previous proposal or gives effect to a Tribunal decision or Tribunal review (Reg 4(3)(c)).

No proposal may be made unless a check has been completed (Reg 4A(1)).

The only exception to this is Reg 4AA, relating to reconstituted entries whose creation day was before the completion of the check on the originating hereditaments, whereby a check has been deemed to be made. See 3.1 deemed checks and the right to make proposals on reconstitutions

In essence this means that a proposal that is a duplicate of the first proposal ie made on the same grounds will only be lawful if it is made by a different proposer and the first proposal was withdrawn at challenge or there was no change made to the list in the Decision Notice. In all other cases it will be barred by one of the provisions in Reg 4(3).

4.18 Proposals re Properties in Common Occupation Act 2018 (PICO) and former IPs

see also

RM Section 7: Properties in Common Occupation: Appendix 4 - Limited circumstances for serving a 2010 list proposal

Proposals for merger under the PICO legislation would normally be made under Reg 4(1)(k) -

‘the property is shown as more than one hereditament and ought to be or should be shown as one or more different hereditaments’.

For IPs who are current occupiers, or were former occupiers at the date of confirmation of check then proposals may be submitted under Reg 4(1)(k).

However, for Former IPs who are not occupiers at the date of check then the grounds on which they can make proposals are restricted to:

(Reg 4(1))

(c) A property’s rateable value is inaccurate due to a change in which types of plant and machinery need to be taken into account when valuing a property (Reg 4(1)(c)).

(d) The rateable value has been changed by the VO which has made it inaccurate. (Reg 4(1)(d)).

(f) The list shows an alteration as applying from the wrong date.

(Reg 4(1)(f)).

Therefore such former IPs (i.e. who have left at date of check) cannot make a proposal in respect of the Properties in Common Occupation under 4(1)(k). In such circumstances the Former IP would have to contact the VO and then the amendment could be carried out by a Valuation Office Notice against which they would then have a right of appeal. If the VO refuses to amend the list there is no action the Former IP can take except submit a request for Judicial Review.

4.19 Unlawful proposals

See Appendix 2 and 4 for more details

An unlawful proposal is one that has not been served correctly in accordance with the regulations. This may be as a result of having no right to make the proposal, timeliness, duplication or some other restriction on making the proposal.

If a proposal is unlawful, no Decision Notice should be issued and the proposal should be refused and the case cancelled. There is no right to appeal the decision to make the proposal unlawful.

Examples of unlawful proposals are:-

not having an interest in the property by being an IP or former IP, so not legally entitled to make a proposal
a former IP making a proposal on grounds he is not entitled to make e.g. compiled list, MCCs.
no check has been submitted by the same proposer
duplication of proposals, second bite of the cherry
being made out of time
not made on one of the specified grounds in Reg 4
against a previous VO list alteration resulting from a proposal
against a previous VT / Tribunal decision on the subject property

If the proposal is defective as to its content, ie missing information required under Regulation 6, then it is treated as an incomplete proposal and not an unlawful one.

In the event a proposal is unlawful, the case should be cancelled on RSA.

4.20 MCC proposals

See also : RM Section 6: Part 1 (i)(7) - Scope of Proposals (VOA - Proposals to alter the Rating List)

MCC proposals made under (Reg 4(1)(b) relating to matters mentioned in para 2(7)(d) & (e) Schedule 6 LGFA 1988 (changes in the physical locality or to the mode and category of other properties in the locality i.e. factors external to the hereditament only) may be made by the later of:

a) last day of 4 months from date of check being completed and

b) last day of a 16 month period from the date on which the VO received a confirmation (Reg 6A(2)).

c) If 12 months has elapsed from the date of submission (confirmation) of the check and the check has not been completed, then the 4 month window starts running from the 12 month point within which to submit a challenge.

If information has been provided under check (4C(1)) regarding an MCC - but the IP does not make a proposal within the time limits above then a proposal on the grounds for that MCC cannot be made (Reg (6A(5)).

If an incomplete proposal relates to an external MCC refer to para 5.5 below for additional rules that apply.

A proposal may refer to more than one MCC only if the Material day and Effective Date are the same (Reg 6A (4)).

So if a proposal mentions more than one ground / MCC for which different MDs and or EDs are applicable then it is unlawful and should be returned to the proposer and no decision notice issued.

For details on material day amended by the new legislation relating to MCCs; see Material day. For MCC proposals the Material Day is the date of confirmation of check.

Proposals may be on any of the grounds specified in Reg 4(1) (a) - (o) and the Material day to apply will depend on the ground chosen for the proposal.

N.B. - if as a result of check, the VO has amended the rating list for an MCC, the Proposer has the option if he wants to make a challenge in respect of an MCC by submitting a proposal under

(a) Reg 4(1)(b) - as an MCC proposal - in which case the Material day will be

the date of confirmation of check. (Material Day SI 1992 / 556 as amended, Reg 3(7)(b)(i).

and / or

(b) Reg 4(1)(d) against the VO alteration for an MCC change - in which case the Material day will be the same material date as in the VO notice of alteration (Material Day SI 1992 / 556 as amended, Reg 3(3))

Failure to correctly identify an MCC in a proposal will lead to the proposal being treated as incomplete, e.g. vacancy of the subject property, which relates to the actual use of the property, and is not a matter under Sched 6 para 2(7).

COVID

On 25 March 2021,The Valuation for Rating (coronavirus)(England) Regulations 2021 SI 2021 / 398 , new regulations were passed that effectively mean that any proposals made on or after that date on the grounds of an MCC citing the COVID 19 regulations will now be unlawful.

Rating (Coronavirus) and Directors Disqualification (dissolved Companies) Act 2021 was introduced in Autumn 2021 and further restricts the proposals than may be made in relation to the effects of COVID.

This retrospective Act affects the occupation of property that COVID will not be considered an MCC for the purposes of rating and the purposes of making a relevant determination.

A relevant determination is either:

a) the compilation or maintenance of the list as to whether a hereditament ought to be shown in the list or not or

b) a determination for maintaining a compiled list compiled on 1 April 2017 as to its rateable value

It is not a relevant determination where it concerns

a) whether the property or part of the property is domestic or not

b) whether the property or part of the property is exempt under Schedule 5 LGFA 1988

In making a determination, no account is to be taken of any matter that is directly or indirectly attributable to COVID subject to limited exceptions.

This does not apply when

a) considering changes to the physical state of the property including changes to mode or category of occupation

b) quantity of minerals or other substances in or extracted from the hereditament on which the determination is made

c) the quantity of refuse or waste material which is brought on to and permanently deposited on the hereditament on which the determination is made

For example

(i) During the period of COVID a building was knocked down or extended – this physical change could be taken into account

(ii) Quantity of gypsum not mined as building industry closed down during COVID. This is covered by the exception and the fact that the amount of gypsum produced has fallen may be reflected.

(iii) Mothballing of mines – ignored if due to COVID

Section 6 of the Act identifies matters that are considered to relate to COVID, the list is not exhaustive. These include:

a) compliance with any legislation for reasons relating to the incidence or spread of COVID

b) compliance with any other legislation for reasons relating to the incidence or spread of COVID

c) in response or consequence of any advice or guidance given by a public authority relating to the incidence or spread of COVID

For example

Compliance with legislation or guidance re COVID that affects trade in a particular way

e.g. Health & Safety changes regarding the operation and COVID such as spacing requirements

Section 7 of the Act, provides that the act applies retrospective and prospectively in England and Wales.

It affects all proposals from 1 April 2017

It applies to all the local lists and the central list.

The act does not apply to the new list in 2023 where COVID is reflected at AVD.

4.21 Submission of Proposal

The Proposal must be served using the VO electronic portal or as otherwise agreed with the VO (Reg 6(2)).

4.22 Content of Proposal

The proposal must include the following (Reg 6(4)):-

a) the name, address and contact details of the proposer

b) the grounds of the proposal including the particulars on which each of the grounds is based - known as ‘the particulars of the grounds of the proposal’

c) details of the proposed alteration of the list

d) the date from which the proposed alteration should have effect

e) the date on which the proposal is served on the VO

f) evidence to support the grounds of the proposal, and

g) a statement as to how the evidence supports the grounds of the proposal

If the grounds refer to a Tribunal decision (Reg 4(1)(e)) then the proposal should also include:

a) the date of the decision made in relation to another hereditament

b) the name of the Tribunal or court which made the decision

c) information to identify the other hereditament

d) the reasons why the decision is relevant to the hereditament, and

e) the reasons why the proposer believes that the decision shows the RV is inaccurate for the hereditament

It is therefore important that the caseworker checks when they receive the case that all the proposal requirements have been fully met as above, if not the proposal should returned as incomplete. In particular the supporting statement and how the evidence provided support the grounds raised.

For more details on incomplete proposals see Appendix 2.

4.23 Lease details (Rent and rent frees)

Where a proposal is made on grounds in Regulation 4(1)(a)-(g) and (i)-(l) (see Grounds for making proposals) and the property is occupied under a lease, the amount payable yearly must be shown, the start date that amount became payable and details of rent free periods (Reg 6(6)) i.e. the rental details are not required for proposals made on the ground of deletion, incorrect address, incorrect description, or where a statement about the hereditament is incorrect.

This means that the lease details are required for all proposals other than ones relating to deletions or amending the address, description or other statements about the property in the list.

If the required lease details are missing then the proposal must be considered to be incomplete.

4.24 Multiple properties

A proposal may refer to more than one hereditament only if it is made on the following grounds:-

Reg 4(1)

(k) the property is shown as more than one hereditament and ought to be or should be shown as one or more different hereditaments

(l) the property is shown as one hereditament and ought to be shown as more than one hereditament

and the proposer does so in the same capacity for each hereditament and they are within the same building or curtilage (Reg 6(7)).

Should this situation arise please refer to the CCA technical process team.

4.25 Requesting Outcomes

A proposal made on the grounds of 4(d) or (f) - (alteration of the list by the VO was inaccurate or the Effective date is incorrect) may request either or both of restoration of the list to its prior state and a further alteration of the list in respect of the hereditament. (Reg 6(8))

4.26 Acknowledgement

The VO has to send an acknowledgement within 4 weeks of receipt of a complete proposal, specifying the date of receipt of the proposal, and a statement of the effects of Reg 9-13E (Reg 7) i.e. the procedures for the VO responding to and resolving the challenge. The VO does not have to send this acknowledgement if the proposal is refused as incomplete.

4.27 Requesting copies of Proposals

Proposals are public documents.

If a request is received under Schedule 9 paragraph 9(1) to inspect a proposal then the material contained in the initial proposal served under Reg 4(2), as required by Reg 6(4-8) and any further evidence provided by the Proposer under Regs 9(8), 9(9(b)), 9(10) or 9(11) will form part of the proposal.

The proposal does not include information provided at check, the VO initial response, or further material provided by the VO during the challenge period, or any information provided by the BA under Reg 9(6) or any other source of information obtained under Reg 9(9).

Any material included with the original proposal or subsequent submissions that is not pertinent to the proposal (extraneous documents or unconnected correspondence etc.) should be redacted, and this would include any personal details. Please see and follow the VO disclosure guidance.

The proposal only comprises information obtained under Reg 9, therefore any information provided at check which is submitted under reg 4C is not included in the proposal unless it has been re-submitted during the challenge process.

There is no obligation on the VO to send copies, either by email or hardcopy by post. Copies may be provided by the VO of any documents but only on payment of the relevant charge. Alternatively they may be viewed in a VO office on screen, or, if not available, in hard copy or printed, and redacted where appropriate.

Therefore it will be necessary to examine each document in detail included in the challenge portal to determine exactly what information/evidence is comprised in the proposal document.

Regulation 6, is clear as to what is required to constitute a complete proposal i.e.

a) name & address of proposer

b) grounds of proposal

c) details of list alteration proposed and effective date

d) evidence to support the grounds

e) statement as to how the evidence supports the grounds

f) where appropriate, details of the tribunal decision referred to

g) where appropriate, details of the rent passing and any rent free periods

Therefore when a copy of a proposal has been requested, or requires sending to the ratepayer, regard should be had to the CCA information sharing guidance and disclosure.

The proposal does not include any information provided as part of an appeal to the VTE.

If a proposal has been received that is incomplete or unlawful, then it is not a complete substantive proposal and in this circumstance a copy of the document should not be sent to the ratepayer under Reg 9(1) or to a third party who has made a request to view proposals on a property as public documents.

4.28 Proposals where the hereditament has been deleted

A check and challenge can only be made where the proposer has the right to make a lawful proposal.

If a property has been deleted from the list, then the occupier (tenant) no longer has any rights in the property. Therefore, when the request for check information, (reg 4B(2)) is made the grounds on which they can submit a proposal is restricted to 4(1)(c) P&M, (d) VO alterations and (f) Eds and only in respect of the period in which they were in occupation. As a former IP they have no right to make proposals against the compiled list, splits etc. Such a proposal would be unlawful. They should have challenged the list entries whilst they were still an IP, however the VO should still consider if the list entries were correct and serve a VON to amend if not which would then enable the former IP to submit a proposal..

If the buildings have been demolished then the land is still standing and therefore only the owner would have a legal interest in the property (all other leases etc being extinguished) and therefore as an IP can select any ground under Reg 4(1).

5 INCOMPLETE PROPOSALS (Reg 8)

5.1 Background

There are no provisions to make a proposal invalid, instead a proposal will be refused if it is incomplete. There is no appeal against this decision.

An incomplete proposal is one that is defective in its content as specified in Reg 6.

This is different to a proposal which is unlawful, (see para 4.19 above) which is one that does not meet the requirements regarding its actual submission e.g. due to missed time limits, duplication or some other restriction.

See Appendix 2 for more details

5.2 Refusal of proposals & conditional proposals

If a proposal does not fulfil all the requirements of Reg 6, i.e. it does not identify the grounds, contains all requisite information, evidence and reasoning etc., it will be deemed to be incomplete and MUST NOT be accepted. This principle should be applied strictly.

The items listed under Reg 6(4), (5) and (6) are statutory requirements, unlike the 2010 list requirements, so if any specified item is missing then the proposal must be made incomplete. This includes all the items specified at 4.27 above which includes the rent passing.

The VO MUST refuse the proposal (Reg 8) and there is no discretion. This may occur at any time after the proposal has been made but before it is resolved by settlement or issue of Decision Notice (including after the acknowledgement has been sent (Reg 7))

If during the Challenge process, it is found that a Proposal is incomplete then the process under Reg 8 must be followed. A Notice of Refusal MUST be served and in this event, no Decision Notice should be issued and the case should be closed on RSA and the Challenge process ceases.

A proposal will be incomplete if it is missing any of the items mentioned in Reg 6(4), (5) or (6):

6(4) (a) the name, address and contact details of the proposer;

(b) the grounds of the proposal including the particulars on which each of the grounds is based (“particulars of the grounds of the proposal”);

(d) the date from which the proposer asserts the proposed alteration should have effect;

(e) the date on which the proposal is served on the VO;

(f) evidence to support the grounds of the proposal; and

(g) a statement as to how the evidence supports the grounds of the proposal

6(5) If the proposal is made against a VT / Tribunal decision

(a) the date of the decision made in relation to another hereditament (“the decision”);

(b) the name of the tribunal or court which made the decision;

(d) the reasons the proposer believes that the decision is relevant to the rateable value or other information shown in the list for the hereditament; and

(e) the reasons the proposer believes that, by reason of the decision, the rateable value or other information shown in the list for the hereditament is inaccurate

6(6) the amount payable each year by the proposer, as at the date the proposal is made, in respect of the lease, easement or licence to occupy, the date at which that amount first became payable and details of any rent-free periods

If all the required items shown above are present in the proposal, regardless as to the quality or strength of the information submitted, provided it is accurate, then the proposal may be treated as being complete.

If the challenge document is complete, but weak as to its content, the proposer runs the risk of not fully covering his case at the outset and being later restricted on providing further evidence and prohibition on introducing new grounds.

If a proposal has been made under Reg 4(1)(b) for an MCC and fails to identify an MCC under the requirements of LGFA Sched 6 para 2(7) (a-e), then that proposal should be treated as incomplete.

Inaccuracies and late discoveries

See also RM Section 6.17 below and Section 6 Part 9: Errors and Omissions in Proposals

In considering errors and whether or not the proposal should be made incomplete, unlawful, etc., regard should be had to the principles established in the VT case Imperial Tobacco Group Ltd v Alexander (306019910109/5u NO5) and Mayday Optical Co Ltd v Kendrick RA/24/2012) as to how such errors should be viewed.

N.B. Any of the factors mentioned in 6(4)(5) or (6) are statutory requirements, so if they are missing then the approach under Imperial Tobacco is not appropriate and they would clearly be incomplete proposals.

If however, information provided in the proposal is unclear, incorrect or is ambiguous then consideration should be given to the following.

Imperial Tobacco Group Ltd v Alexander (306019910109/5u NO5)

i) First are errors of or omissions of a clerical nature which are trivial, insignificant and de minimis. These have no impact on the proposal’s validity and should be ignored.

ii) Secondly, there are errors and omissions of substance but not the result of a deliberate attempt to mislead which do not impair the VO’s ability to consider the appellant’s case and which have no adverse impact on an assessment of the correct rateable value. This encapsulates two questions: (a) Has there been substantial compliance? (b) Has it caused the VO any prejudice? If the answer to (a) is yes and to (b) no, these failures do not render the proposal invalid.

iii) Thirdly, there are errors or omissions of a kind that misrepresent the appellant’s case or mislead the VO in considering the matter on its merits. Such error or omission will render the proposal invalid if the VO decides so to treat it. But if in the exercise of his discretion he chooses to disregard it and proceeds on the basis that the proposal is valid, that is entirely proper and the VO may either adjust the rateable value or allow the case to proceed to appeal before the Tribunal, but he may not thereafter raise or rely on the invalidity.

iv) Finally, there will be errors or omissions so fundamental that the proposal cannot in any circumstances be treated as valid (as in R v Northamptonshire Local Valuation Court, ex p Anglian Water Authority [1991] RA 93 CA, where a sewage works that no longer existed was named in the proposal instead of one half a mile away; and in Mainstream Ventures Ltd v Woolway (VO) [2000] RA 395, where the proposer was not qualified to make the proposal as he was not the occupier). 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. This is clear from the Mainstream case (supra) where the invalidity was raised for the first time by the VO on appeal to the Lands Tribunal although the defect should have been noticed at a much earlier stage.

See also Alam v Stoyles (UT) RA 71 2018 para 24

‘The proper approach to the validity of a proposal to alter the rating list laid down by regulation 6 of the 2009 Regulations was the same as was taken by courts and tribunals to the consequence of procedural errors in other statutory contexts. There were no special rules for rating.’

para 25

‘where a statute lays down a process or procedure for the exercise by a person of some right conferred by the statute, and the statute does not expressly state what is the consequence of the failure to comply with that process or procedure, the consequence used to be said to depend on whether the requirement was mandatory or directory. If the requirement was mandatory the failure to comply was said to have invalidated everything which followed; if it was directory the failure to comply would not necessarily have that effect. That approach is now regarded as unsatisfactory and has been replaced:

“The modern approach is to determine the consequence of non-compliance as an ordinary issue of statutory interpretation, applying all the usual principles of statutory interpretation. It invariably involves, therefore, among other things according to the context, an assessment of the purpose and importance of the requirement in the context of the statutory scheme as a whole.”

para 26

As Etherton C explained at [25]-[29] in cases in which the decision of a public body is challenged or which concern procedural requirements for challenging a decision (in which category we would place the making of a proposal to alter the rating list), the courts have asked whether the statutory requirement can be fulfilled by “substantial compliance” and, if so, whether on the facts there has been substantial compliance even if not strict compliance.

para 27

At [16] Lord Woolf identified the sort of questions which it is necessary to ask in cases such as this:

“I suggest that the right approach is to regard the question of whether a requirement is directory or mandatory as only at most a first step. In the majority of cases there are other questions which have to be asked which are more likely to be of greater assistance than the application of the mandatory/directory test: The questions which are likely to arise are as follows:

(a) Is the statutory requirement fulfilled if there has been substantial compliance with the requirement and, if so, has there been substantial compliance in the case in issue even though there has not been strict compliance? (The substantial compliance question.)

(b) Is the non-compliance capable of being waived, and if so, has it, or can it and should it be waived in this particular case? (The discretionary question.) I treat the grant of an extension of time for compliance as a waiver.

(c) If it is not capable of being waived or is not waived then what is the consequence of the non-compliance? (The consequences question.)”

para 52

We do not regard it as of any significance in this case that the VO did not serve a notice of invalidity. The nature of the error in the notice was not apparent on its face, or from information which might readily have been to hand, and the VO was under no duty to investigate whether what the proposer said about his status was correct.

para 58

In cases such as this it will always be necessary to identify the requirement which has not been complied with and the extent to which information has not been provided, but once that has been done it is necessary to consider whether that degree of compliance was sufficient in the circumstances to amount to substantial compliance with the procedural requirements as a whole…

There will of course be cases where the consequence of omitting a single piece of information is that substantial compliance has not been achieved, but there may be others where the missing information adds little of importance to what has been provided and where the requirements of regulation 6 have been substantially complied with despite its absence.’

Consequently, it will depend on the nature of the error and its impact as to whether it is material and its existence fatal in considering whether the proposal is complete or otherwise.

Within four weeks of receiving a Proposal, the VO must acknowledge to the proposer that the Proposal has been received, this does not apply to incomplete proposals (Reg 7(1) & (2)).

Whilst the proposal should be read and understood as a single document as to its scope and meaning, it still has to meet the requirements of Regulation 6 and if any of the specified details are not provided the proposal MUST be made incomplete by virtue of Regulation 8.

Conditional proposals

If conditional phrases have been used in the proposal, for example due to COVID the agent is unable to obtain or clarify some information, or that should the case proceed to appeal then they will make further submissions, or referral to a third party report such as a GPCR outcome, then such phrases have no legal standing per se.

The proposer should include all his evidence, and there is sufficient time between the preparation and submission of a check, and submission of the proposal, to be able to provide full and accurate information at challenge.

The proposal together with the evidence submitted at challenge is the only evidence that may be considered later at appeal stage. If the proposer is intending to add more information later then they risk being prevented from doing so due to the restrictions on further evidence at the Appeal stage under Reg 17A (Procedure Regulations 2009/2269) and being refused by the VT.

The Challenge documentation should stand alone in its own right and the principle of CCA is that all the relevant evidence should be provided at the outset then thoroughly examined during challenge stage. This is subject to the introduction of ‘new evidence’ that was not available at the time of making the proposal being permitted under Reg 9(10).

CCA Ops have a specific form of words to use where conditional proposals have been made - see operational guidance

5.3 Notice of Refusal

In the event of an incomplete proposal, the VO must serve on the proposer a notice of refusal which specifies

(Reg 8(2)):

(a) the missing information

(b) the date the notice is served.

5.4 Further Submissions due to a proposal being incomplete

If a proposal is incomplete then the proposer may submit a further proposal within 4 months starting from the date on which the check was completed (Reg 8(3)).

5.5 Additional Time and re-submission attempts

Additional Time

The time period from when the initial incomplete proposal was submitted, to the date of the notice of refusal, is ignored when calculating the balance of the 4 month period for re-submission (Reg 8(4)). This extension is only applied to the first re-submission even if multiple attempts are made to submit a proposal.

If the second or further proposal attempts are also incomplete then regulation 8(4) does not apply. The time limit for re-submission of further attempts reverts back to the original 4 month window from the date of check completion.

5.6 Restriction applying to incomplete proposals relating to external MCCs only

Proposals made under Reg 4(1)(b), external MCCs, (i.e. quoting grounds under schedule 6 para 2 (7)(d) or (e)), have to be submitted within a maximum time limit of 16 months from the date of confirmation of check or 4 months from the date of completion of check. Any re-submission of an external MCC proposal that was incomplete must be made within the 4 month period from completion of check or it cannot be made. The extension of time under Regulation 8(4) does not apply to these types of proposals.

Therefore, if the Proposer submits an external MCC challenge after 4 months (and before the 16 months from completion of check) and that attempt is incomplete he will be out of time to re-submit his proposal under Regulation 8.

He could submit a fresh check(2) and proposal (2) for the MCC provided he meets all the following:

a) The MCC proposal is either within

(i) 4 months of completion of check 2 or

(ii) 16 months of check 2 submission (whichever is later) AND

b) The Proposal is still within the original 16 month period of check 1 submission AND

c) No earlier checks mentioned that MCC for which the time limits have now elapsed

d) No earlier proposal has been submitted for the same MCC.

If the proposal does not meet all the requirements above no further attempts may be made to submit that MCC proposal following the initial proposal being made incomplete.

5.7 Rights of appeal re ‘incomplete’

There is no right of appeal against the decision to refuse a proposal because it is unlawful or if it is considered to be incomplete.

5.8 Replacement and subsequent proposals and ‘second bite’ of the cherry

Reg 6 sets out what must be stated in a proposal for it to be accepted as full and complete. By the document being incomplete a legal proposal has not been made as it does not fulfil the legal requirements. Therefore any re-submission will not constitute a duplicate proposal if the original document was treated as being incomplete and a fresh proposal may lawfully be made.

The definition of an incomplete proposal is set out in Reg 8(1), which consequently means that the restriction on duplicate proposals is not triggered merely because the first attempt was incomplete.

It is therefore open to the IP (or former IP) to submit a replacement proposal within the required 4 month period. The replacement proposal would then have the same effective date (subject to Reg 14) and Material Day as the incomplete version would have done.

If the proposer waits until the last day of the 4 month window to submit their first attempt at a challenge, this places them in a difficult position in submitting a replacement proposal under Reg 8(3) as they will effectively have run out of time to submit a fresh proposal.

There is nothing to stop an IP submitting a fresh Check and subsequent proposal if the original proposal was incomplete. The only exception to this is MCC proposals, whereby if a check has been submitted and a full and complete proposal under Reg 4(1)(b) (MCC) has not been submitted within the required time limits, then the IP cannot submit a further proposal in respect of that particular MCC (Reg 6A(5)).

5.9 Ambiguous wording on a proposal re MCC / against VO alteration for MCC following check

If an MCC has occurred, then when the check is concluded, the VO may make a list alteration to give effect to it or the VO may not take any action to amend the list and then the matter may be dealt with at challenge.

Following the completion of check, the IP has two choices to submit a challenge referring to the MCC:-

(1) If the list has been altered for the MCC and the IP does not accept the alteration, a proposal may be made challenging the VO alteration under Reg 4(1)(d),

(2) Alternatively a MCC proposal under Reg 4(1)(b) may be submitted.

Both options are open to the IP. It is therefore possible that 2 separate proposals could be made, relating to the same MCC but in different contexts as they are made on different grounds under Reg 4(1).

For the purposes of making proposals these are considered to be different ‘events’ as defined in Reg 4(4). They will have different material days; the proposal against the VO notice, (4(1)(d) proposal), takes the same material day as that in the notice (the date giving rise to the event), whereas, for the MCC proposal (Reg 4(1)(b)), the material day is the date of confirmation of the check. The Effective Date of any changes will be the same for either type of proposal.

The proposal should be clear as to which ground under Reg 4 is being used as different time limits apply for submission.

A single proposal cannot be made on two different grounds if they have different material days or effective dates, the two types of proposal are mutually exclusive in this instance.

It is not for the VO to decide which is the appropriate ground to adopt. The proposal should be clear and unambiguous when read in its entirety. It the proposal is not clear as to which ground it has been made on then it should be made incomplete and rejected.

5A END OF 2017 LIST PROVISIONS AND INTERACTION WITH 2023 RATING LIST

Please see Appendix 6 for full details of the end of list provisions and their application for both the 2017 and 2023 lists.

6 CHALLENGE PROCEDURES (Reg 9)

See also

RM Section 6: Interpretation of Grounds of Proposal
RM Section 6: Scope of Proposal
RM Section 6: Settlement of proposals before a VT decision ENGLAND
RM Section 6 part 9: Rental evidence in valuation proceedings Reg 17
RM Section 6 part 9: Considering rental evidence (hierarchy and tone)

Initial response checks

On receipt of the proposal the caseworker should be reviewing the proposal and the evidence submitted in detail (see below) to establish if the proposal is complete and legally made by the person who has authority to do so. If the case should be prioritised due to hardship or requires technical advice and then the appropriate action should be taken.

Additional care should be taken where the proposal is submitted by anyone other than the current ratepayer. In that case, checks should be made that a copy of the proposal has been served on the ratepayer (in accordance with Reg 9(1)) and that the maker of the proposal is legally entitled to do so, e.g. that the capacity of the proposer is correctly stated on the proposal.

If the proposal is missing information then it should be made incomplete and that process followed. If the proposer was not entitled to make the proposal, e.g. claiming to be the owner when he was not, then the proposal is unlawful and should be returned.

If the proposal contains information that is inaccurate, then consideration should be given to the implementation of penalty procedures and the penalty process invoked if appropriate.

Before issuing an initial response or decision notice the following checks should be made:-

a) The proposal linked to the case is complete and if not then the ‘incomplete procedure process’ should be followed. (This includes the submission of reasoning as to how the evidence supports the grounds of proposal)

b) the proposal is lawful and with the grounds quoted clearly and unambiguously

c) the grounds of proposal are correct for the change being asked for

d) the proposal is linked to correct assessment status (i.e. is it a proposal against an historic assessment) and the correct facts are established at the material date.

e) The status of the IP is correct and still valid.

(e.g. if the maker of a proposal was a company than subsequently entered a CVA agreement, it constitutes a new company and therefore will no longer be the proposer but possible IP or new ratepayer).

e.g. A management company has completed the proposal as owner, but they are not the owner and have no authorisation to act as the agent of the owner

f) any matters outstanding from check (see below)

g) the relevant material day and effective dates are correctly identified

h) if any other persons are party to the proposal who need to be included in the process or have been wrongly included as IPs

Matters outstanding from check, for example, would be where the VO has disagreed with the factual changes made by the IP.

The evidence should be reviewed and consideration given to the most efficient way of dealing with the Challenge. In some circumstances it may be more efficient to discuss the case with the proposer to seek agreement to clarify outstanding facts or to the correct level of value to apply.

However, where evidence submitted is not sufficient to suggest that the Rating List may be inaccurate, an initial response should be prepared.

The initial response should address all the issues raised in the Challenge and provide comprehensive evidence to counter that provided by the proposer. Evidence should not be ‘cherry picked’. Any rental evidence provided by the VO should be compliant with Regulation 17 (Reg 17, SI 2009/2269 Appeal Regulations). The response should also give a reasoned explanation as to how the evidence supports the assessment and how any quoted case law is relevant to the case. Evidence held on FORs and SDLTs will carry the greater weight at any hearing and so that source should be the preferred source of rental information. The use of Costar or other sources of information are less reliable and of limited use in the context of hierarchy of evidence.

Caseworkers should be aware that all the evidence likely to be relied on at Appeal stage should be included in the initial response, as there are extremely limited circumstances under which the VTE will admit new evidence at the appeal stage, (Reg 17A, SI 2009/ 2269).

For further details on evidence used in Reg 17 Notices please see Rating Manual, Chapter 8

6.7 Incomplete proposals

If during the challenge stage it is discovered that the proposal is actually incomplete in a material particular, i.e. missing information required under Reg 6. then the proposal should be made incomplete and the IP notified using the Notice of Refusal with reasons for its failure. The CCA process for incomplete proposals should be followed in accordance with Reg 8.

A proposal will be incomplete if it is missing any of the items mentioned in Reg 6(4), (5) or (6):

6(4) (a) the name, address and contact details of the proposer;

(b) the grounds of the proposal including the particulars on which each of the grounds is based (“particulars of the grounds of the proposal”);

(d) the date from which the proposer asserts the proposed alteration should have effect;

(e) the date on which the proposal is served on the VO;

(f) evidence to support the grounds of the proposal; and

(g) a statement as to how the evidence supports the grounds of the proposal

6(5) If the proposal is made against a VT / Tribunal decision

(a) the date of the decision made in relation to another hereditament (“the decision”);

(b) the name of the tribunal or court which made the decision;

(d) the reasons the proposer believes that the decision is relevant to the rateable value or other information shown in the list for the hereditament; and

(e) the reasons the proposer believes that, by reason of the decision, the rateable value or other information shown in the list for the hereditament is inaccurate

The IP can re-submit the proposal provided it is done so within the required time limits (ignoring the period of time it took the VO to decide it was incomplete Reg 8(4). There is no right of appeal to the VT from the decision to treat the proposal as incomplete.

Please note that the extension of time under Reg 8 is not applicable to the 16 month time limit for external MCC proposals if submitted after the original 4 month period.

Once a complete substantive proposal has been made for a specific MCC then no further proposals in respect of that particular MCC may be made (Reg 6A (5)).

6.8 Factual information not agreed at check

Factual information relates to the property characteristics and its survey and is not a matter of opinion e.g. areas, beacon characteristics, actual trade, etc. Proposals should be resolved using the information supplied. If no plans or surveys have been included in the submission (or check), then it may be reasonable to address this in the initial response by stating that no evidence has been provided to show the areas are incorrect. The preferred approach would be to request a copy of the plans and survey before issuing the initial response.

The facts declared at Check are the up-to date facts at the time the check is made. It is therefore possible that the facts on non-MCC Challenges are not the same as those confirmed at Check. For non-MCC challenges the facts at the relevant Material Date of the proposal will need to be considered e.g. compiled list date or date of event (depending on the type of proposal) and these new facts will need to be established and agreed by the Ratepayer and included in the initial response.

If facts are different from those declared at check, then the VO will need to consider carefully if that information was by error or default of the ratepayer when considering the correct effective date to apply, if the change to the assessment results in an increase in the assessment (Reg 14(7)). Reference to the supply of incorrect information by the proposer should be referred to in the initial response.

In considering the valuation on the subject property, it has to be valued as it physically stood at the relevant Material Day. e.g. if there was an extension at the Material Date, that the VO was unware of, this must be taken into account as the starting point before considering any reduction in the assessment for other matters.

6.9 Survey data, plans and inspection

If there are any disputes on areas or survey data then these should have been resolved at check.

However, for example if following inspection, there is a dispute, the proposer should be asked for a copy of his plan and survey.

The VO will only share surveys and plans where it is proportionate to do so and only after all other avenues have been exhausted. If necessary a joint inspection may be arranged before a decision notice is issued. Please also refer to the rules on disclosure.

If areas are found to be different then this should be raised with the IP prior to the issue of the initial response and the correct facts agreed.

Reference to data which has been confirmed at check and later found to be incorrect should be made in the initial response or at the earliest opportunity upon discovery.

If the discrepancies are not raised early in the challenge process this may cause difficulties at the appeal stage, as the VT may treat this as ‘new evidence’ for which restrictions on admittance may apply.

6.10 New facts after original completion of check

A proposal may not be made unless a check has been completed (Reg 6(1) and

Regs 4B-F).

There is nothing within the legislation to prevent new or different facts being provided as part of the proposal when the document is submitted.

e.g. This could be in the form of different areas being agreed due to different circumstances being applicable at the material date of the proposal

However, no new grounds may be introduced during the progress of challenge once the proposal has been submitted.

6.11 Material Day - establishing facts

For MCC proposals (made under Reg 4(1)(d) SI 2009/2268)), the facts (under Schedule 6, LGFA88) have to be established as at the date of confirmation of check, the material day for this type of proposal. See Rating Manual - Material day

For non-MCC proposals, the Material Day is either the compilation date or day of event depending on the type of proposal. The facts therefore to be agreed may be different from those agreed at check. Any new facts, e.g. survey data, areas etc., should be covered in the initial response and agreed with the Proposer.

See also 3.11 and 4.2 above regarding Material Days for MCC proposals and the differences between Check and Challenge

6.12 No relevant evidence provided

If in the opinion of the caseworker no or totally irrelevant evidence has been submitted then the proposal is incomplete. If inadequate evidence has been submitted then a Decision Notice should be issued explaining the reasons why the grounds of proposal are not substantiated or ‘made out’.

6.13 Comparable evidence only submitted or limited rental evidence

Consideration needs to be given to the weight of evidence and type of rental evidence. The VO’s response should address all issues raised in the Proposal.

The evidence used in the response should be comprehensive and in depth to show that the rateable value is not unreasonable. It should be remembered that the evidence included in the initial response will be relied on by the VO at any Tribunal hearing so should be sufficient to support the valuation contentions and true comparable properties used e.g. with regard to size and location.

As checks and proposals may be submitted up to the closure of the rating list, the tone is unlikely to be established beyond doubt. It is therefore expected that rental evidence to support assessment evidence should be included in the initial response. Similarly, in respect of MCC proposals, rental evidence should be included to support the basis of assessment of the full value of the property at the Material Day as this has to be ascertained prior to consideration of any allowances for disabilities.

If having considered the evidence the Proposal cannot be well founded but the VO considers an alteration of the list is warranted then the caseworker can discuss this with the proposer with a view to settlement and amendment of the Rating List.

If the Proposal is well founded, no Decision Notice will be needed.

If the VO opinion is that the RV or list entry should be a different figure to shown in the proposal but agreement cannot be reached, the list will need to be altered and a Decision Notice issued explaining why a different figure has been adopted.

6.14 RVs of Comparable evidence appears incorrect

If having reviewed the evidence it appears that key comparable assessments are incorrect, and this evidence is likely to be relied on at VTE, then errors to the Rating List should ideally be amended before a Decision Notice is issued and before any VTE hearing, but this may not be possible due to resourcing and the VO policy on this should be followed. The VOR gateways for raising VORs should be used to review assessments. It is acceptable to refer to a review of this evidence in an initial response.

If there is sufficient rental evidence to counter the incorrect assessments these should be included in the decision notice and it should be stated that reliance is placed on the rental evidence in preference to comparable evidence.

If the incorrect assessments are essential to the case then this should be discussed with the Team leader so they may be corrected before the decision notice is issued especially if the case is likely to lead to appeal.

6.15 Rental evidence and Reg 17(SI 2009/2269), rights to view (including after decision notice issued)

See RM Section 6 Part 9 Rental evidence and Reg 17s for further guidance

Disclosure of RALD/FOR information is made under the provisions of s.18(2)(a)(i): Commissioners for Revenue and Customs Act 2005 (CRCA)

‘18 Confidentiality

(1) Revenue and Customs officials may not disclose information which is held by the Revenue and Customs in connection with a function of the Revenue and Customs.

(2) But subsection (1) does not apply to a disclosure—

(a) which—

(i) is made for the purposes of a function of the Revenue and Customs, and

(ii) does not contravene any restriction imposed by the Commissioners,

Reg 17 does not provide authority to disclose information covered by CRCA. Reg 17 operates to prevent the use of such information in VT proceedings unless the required notice period has been given and the recipient has had the opportunity to exercise his rights of inspection and counter-notice.

It is important to note that rental information contained in any initial response or decision notice should fully comply with the Reg 17(SI 2009/2269) requirements regarding the use of FOR evidence and rights to view.

If an FOR contains sensitive information such as receipts, then reference should be made to the Disclosure guidance on the intranet. It would be lawful to include information from a FOR, SDLT etc., at Challenge if it is relevant to the case and would need to be relied on should the case proceed to VT. However, as with all disclosures involving potentially sensitive third party information, we should be satisfied that the information is necessary, relevant and proportionate to help resolve the case.

As well as a summary schedule the response should also include the name of the document being referred to, the property to which the information relates and the information to be relied on, together with rights of inspection of the documents. This is included in the initial response notice in order to give the proposer a chance to consider the evidence during the challenge stage. No photographic images may be made of FOR evidence by the Proposer or given to him. The request to view by the proposer must be in writing.

The number of hereditaments and FORs that can be requested in the counter notice is limited to the number of hereditaments specified in the Reg 17 notice. This must not exceed 4 or if greater the number of hereditaments specified in the Valuation Officer’s Reg 17 notice (issued under SI 2009/2269). However, the person is entitled to inspect all relevant documents held in relation to those hereditaments. Under no circumstances should copies of the actual FORs be given or sent to the Proposer or included in the Decision Notice.

It is essential to include details of FORs on the subject property, if relevant, within the Reg 17 Notice requirements as there could be issues later at Appeal stage regarding admissibility if not included at the Reg 17 stage (especially if the tenant of the subject property has changed, as the IP may not be aware of the details of earlier rents, although rents within the IP’s knowledge possibly may be raised via cross examination).

If the VO wishes to refer to rental evidence this should all be included at the Initial Response stage so that the Proposer has time to request and view FORs. This will enable any issues, disputes or discussions on the rental evidence to be concluded prior to the issue of the Decision Notice.

Under no circumstances should copies of the actual FORs be sent to the Proposer or included in the Decision notice. The caseworker should also consider if it is appropriate to redact personal information on any FOR to be viewed.

See RM Section 7 Proposals - FORs - for further information.

The proposer may request to view the FOR but must give 24 hours’ notice minimum.

The 24 hour notice period is statutory, but is ‘…not less than 24 hours’ notice…’ and the inspection has to be permitted ‘at any reasonable time’. What is ‘reasonable’ will depend on the circumstances – a request made at 6pm on a Thursday may not be in time to inspect on Friday as the 24 hours would expire after close of business for the Friday and may have to wait until the following Monday. A request to inspect a large number of hardcopy FORs held in different locations may need a longer period to assemble the documents etc.

Redaction may be appropriate if the FOR contains extraneous material wholly unrelated to the information to be relied on or sensitive personal information.

Once a Decision Notice has been issued, the right to view FOR information, under Reg 17, will continue until the time limit for making an appeal to the VTE, usually 4 months after the Decision notice, has lapsed.

If an appeal is made, the Proposer still has the right to request to inspect the FOR information. However there may be difficulties with adding any further evidence to the appeal following the provisions of Reg 17A (SI 2009/2269) due to the restrictions on admittance of new evidence. Once the time for making an appeal has elapsed, then the ‘relevant proceedings’ have ceased and the Proposer will not have the right to view the FOR documentation.

Evidence obtained from FORs and SDLTs is covered by the provisions of Reg 17 and the hereditaments to which this evidence relate count for the purposes of the number of hereditaments the proposer is entitled to ask for.

Care should be taken when using-other forms of rental information (ORIs), includes rents from other sources, this may be Costar, hearsay, proposals, discussions with agents etc. This should be distinguished from FOR information, preferably shown on a separate schedule. This evidence, whilst still relevant, will carry less weight. The hereditaments that ORI information relates to are not to be included in the count of hereditaments for Reg 17 purposes.

6.16 ‘Without prejudice’ correspondence

‘Without prejudice’ is a rule of law and part of the law on privilege allowing parties to a dispute to communicate freely for the purposes of reaching a settlement without risk of those communications being used against them at a hearing. (Cutts v Head (1994) Ch 290).

Once privilege is established, the right to withhold the document is an absolute right. Therefore genuine without prejudice communications where the IP is making an offer to settle should be excluded from the decision notice. If a communication contains an offer to settle then that part of the communication should be redacted as it falls under privilege.

Essentially, if an email contains evidence or factual information pertinent to the proposal then it forms part of the proposal under Reg 9(12) but any information relating to an offer to settle the challenge must be treated as being ‘without prejudice’ and therefore redacted from the document.

6.17 No case to answer

There may be occasions where the evidence provided means that whilst the proposal is complete, the grounds of the particulars mean that no alteration can be made to the list.

For example, where the Material Day of the proposal is after the end of the MCC that it is quoted in the proposal e.g. road works or redevelopment works have finished before the check was submitted.

In these cases there would be no case to answer, a withdrawal should be sought and if not forthcoming then a Decision notice may be issued without the need for an initial response. However, if additional evidence or points have been raised then these should be addressed. Reg 9(7) only requires the VO to share information if it considers it reasonable to do so. However, if evidence has been provided we should not move to a Decision Notice without sharing our evidence.

If a proposal has been made by a party not entitled to make it, e.g. they do not have the interest in the property they state they have, then the proposal will be unlawful.

The VO should consider the grounds of the proposal however to see if it is appropriate to issue a VON to amend the rating list to ensure its accuracy even if the proposal is unlawful.

6.18 Scope and errors in the valuation

As the ground of proposal have not changed between lists, then case law and basic principles established regarding the scope of proposal still apply as they did in 2010.

The Proposal should only be considered on the grounds on which it has been made. The Proposer is not allowed to introduce new grounds during the challenge period.

If during the course of the challenge process evidence emerges that suggests the valuation is incorrect due to other reasons not mentioned;

e.g. FF offices assessed with car parking and the Proposer is only challenging the level of values but the proposal should have asked for it to be split off, then this matter is outside the scope of the proposal.

Ideally, in this example, the proposal should be withdrawn at this stage and a VON issued to correct the list.

If the proposal is not withdrawn then the Decision Notice should be issued

Where an alteration to the list is required which is outside the scope of the originating proposal, the Decision Notice should state clearly:

‘the alteration required cannot be given effect because it is not within the scope of the permitted proposal, and that the VO will be amending the list separately outside of the CCA process by a separate notice of alteration’.

This wording is important as the separate alteration will not form part of the current live CCA process but the IP will be entitled to submit a check and challenge against that subsequent alteration. This is also important as that change will be outside the scope of consideration should the matter proceed to appeal at VT.

and the VO should state that the list will not be altered in accordance with the proposal because the proposal fails to identify the correct unit of assessment, in that the hereditament needed to be split. Separate action should be taken on a VON to split the assessment which then gives rise.

See RM Section 7 Part C 2010 England and 2017 Wales for details to consider regarding scope of proposal as case law quoted is still relevant for 2017 England.

Scope of proposal and Monk RV £0 cases

All proposals must be considered in relation to the scope of the grounds on which it was made. Case law on scope of proposal is the same as it was for 2010. If the Proposer during challenge is relying on matters outside the scope of the proposal to secure a list change and the VO believes the list should be altered, then the correct course of action is for the proposal to be withdrawn and then the VO issues a notice of list alteration to give effect to the change.

This would apply to Monk redevelopment type cases (See RM Guidance on ‘Repair’, VOA - Part 6: Disrepair and Works of Redevelopment/Reconstruction Practice Note 1- Rating (Valuation) Act 1999, where the proposal is seeking a reduction to £0 and there is evidence to satisfy the VO that a scheme exists and the hereditament is incapable of beneficial occupation and should be deleted from the list. In this scenario the proposal should be withdrawn and a VON issued to delete.

Alternatively the Proposer can submit a correct proposal asking for deletion under Reg 4(1) (h) as a request for deletion which is a separate and distinct grounds for making a proposal from a request for a reduction or MCC (Reg 4(1) (a), (d) or (b)) provided he does so within the prescribed time limits.

6.19 MCC proposals

Material Day

see paras Check 3.11 and Challenge 4.2 above

If as a result of check, the VO has amended the rating list for an MCC, the Proposer has the option if he wants to make a challenge in respect of an MCC by submitting a proposal under

(a) Reg 4(1)(b) - as an MCC proposal - in which case the Material Day will be the date of confirmation of check. (Material Day SI 1992 / 556 as amended, Reg 3(7)(b)(i)).

For the purposes of a Proposal, if at the Material Day the facts are different to those agreed at the date of confirmation of check then it will be necessary for the caseworker to agree the facts as at the Material Day as well (e.g. A Reg 4(1)(d) proposal, day of event)

If a proposal has been made on the grounds of an MCC, then the MCC must be in existence at the Material Date (MCC proposals MD is the date of confirmation of check) and also be value significant before it is considered to be ‘made out’. ie a relevant MCC. If there is a relevant MCC before any reduction may be given for the MCC, the full value of the property must be determined at the Material Date before any allowance is given.

Where no MCC exists at the Material Day

Where a proposal has been made on the grounds of an MCC for which, either it is not in existence at the Material Day, or the change of circumstances mentioned is not a material change because it does not constitute matters mentioned in Schedule 6 para 2(7), LGFA 1988 e.g. because it is an economic factor, then the grounds of the proposal are unfounded.

In this event a response (Decision Notice) should be issued rejecting the grounds of proposal explaining that the event referred to was not in existence at the Material Day and consequently the grounds are ‘not made out’.

However, in order to ensure that the VO position is protected at any subsequent appeal hearing, depending on other evidence submitted, it will be necessary for the caseworker to have previously addressed all other issues raised during Challenge, valuation and any replies to evidence supplied by the Proposer.

6.20 Issuing Initial Response (Reg 9)

Prior to issuing the initial response the caseworker should check to ensure that the Proposer has not changed status (eg gone in to liquidation) and is entitled to have made the proposal. If the proposer no longer exists then an appropriate decision notice can be issued and list altered if necessary. If the proposer still exists then proceed with an initial response.

Having considered all the grounds raised and the supporting evidence, if the initial issue cannot be resolved by well founding, a comprehensive initial response stating the VO’s case should be issued to the IP.

The response should fully address new evidence relating to the grounds of proposal, even if they were submitted after submission of the original proposal. It should explain how the evidence supports the assessment and also, if quoted, how the case law is relevant. If there is a rent passing on the subject property, reference to the analysis of the rent should also be made with reasoning as to its relevance or otherwise of the assessment. Evidence held on FORs and SDLTs will carry the greater weight at any hearing and so that source should be the preferred source of rental information. The use of Costar or other sources of information are less reliable and of limited use in the context of hierarchy of evidence.

If further evidence relating to new grounds has been received after the submission of the proposal this evidence should be rejected, as new grounds may not be introduced. The appropriate correspondence for refusal of evidence should be used and it should be fully explained why the evidence has been rejected.

Operational guidance states that a time limit should be set out for a reply to be received in the initial response. This time limit should be reasonable according to the amount of evidence and information provided and allowing the IP sufficient time to consider the matters raised and supply a suitable reply before any further action is taken.

If there is no reply from the IP to the initial response then a Decision Notice should be issued. As it may be possible that an IP reply has not reached the caseworker, it would be prudent for the caseworker to contact the proposer shortly before the expiration of the time period within which a reply was sought before issuing the Decision Notice. The VO will be open to criticism at VT if a reasonable time has not been given for the IP response.

If a response is received from the IP after the Decision Notice has been issued, e.g. the documents have crossed in the post, then the caseworker should consider the later evidence and re-issue the Decision Notice clearly explaining the situation re late receipt of information and fully addressing the later matters.

6.21 Further evidence after initial response (Reg 9(8)&(9))

Any evidence provided under Reg 9 forms part of the proposal and must be submitted using the VO electronic portal or as agreed with the VO (Reg 9(12)).

The IP may come back with further evidence under Reg 9(8) provided it is in support of the grounds of the proposal and does not include or refer to fresh grounds. In the case of fresh grounds, this evidence should be rejected and explained in the VO response (Reg 9(10)).

Rights to submit further information under Reg 9 (8) are subject to the pre-requisite of the VO having supplied information under Reg 9 (7).

Before the proposal is determined, the proposer may provide further evidence relating to the grounds if it was not known at the time of making the proposal and could not have been reasonably acquired (Reg 9(10))

Provided both parties agree in writing, the proposer, may provide further evidence in circumstances not covered above (Reg 9(11)).

The Relevant Authority may provide evidence relating to the proposal to the VO, in which case, the VO must provide a copy of that evidence to the proposer, to which the proposer may respond (Reg 9 (6)(b)). This will be essential in cases relating to completion notices and deletions in particular as the BAs can no longer be a party to a proposal.

N.B. The VO could consider including the BA as a witness at VT, but all their evidence must have been included at challenge stage prior to the Decision Notice being issued.

If the VO holds information that relates to the particulars of the grounds of the proposal, then the VO, if it is considered reasonable to do so, may provide this information to the proposer, (Reg 9(7)). This information will be included in the initial response to which the proposer may provide further evidence to support his contentions (Reg 9(7)). Unless there is a compelling reason for us not to do so, ALL our relevant evidence should be shared.

Additionally, if the VO receives any further information relating to the particulars prior to the decision notice then the VO should provide it to the IP again if reasonable to do so (Reg 9(9)).

If evidence becomes known to the proposer that could not reasonably have been acquired before the proposal was made this may also be provided to the VO for consideration (Reg 9(10))

Further evidence may also be included in the challenge not covered by the above provided the proposer and VO agree in writing to its submission (Reg 9(11)).

6.22 Issues pending outstanding Tribunal hearings

If the grounds of proposal relate to a Tribunal or Court appeal which is waiting to be heard or outstanding for a decision, then the Decision Notice should still be issued in accordance with statutory requirements. Reference to and details of the relevant outstanding case should be made in the Decision Notice.

The VO has a period of 18 months from the date of receipt of the Proposal, or longer period as agreed in writing by the VO and Proposer, in which to issue a Decision Notice (Reg 13A (1)(c)(iii)). It may be appropriate in this circumstance to agree with the Proposer to extend the period of time in accordance with this regulation pending the outcome of the Tribunal/ Court decision.

The parties can then, once an appeal is submitted to the VTE, request a stay of proceedings pending the awaited decision. It may then be appropriate at that stage to request that new information be admitted into the proceedings (Reg 17A(SI 2009/2269)).

7.0 DETERMINING THE PROPOSAL

See also Section 7: Proposal - settlement of proposals before a VT decision

Reg 9D: Time Frame for Determining a Proposal if penalties are imposed

If a penalty (Reg 9) has been imposed then the VO must not determine the proposal ie end the challenge process until the end of the period for making a penalty appeal under Reg 9C.

If a penalty appeal has been submitted then the proposal cannot be determined until after the VTE has decided the appeal (Reg 9C).

This means that the caseworker cannot issue a Decision Notice if the penalty process has been imposed until that process has ended.

7.1 Well founded

The VO may decide that a proposal is well founded. As soon as reasonably practical after making that decision the VO should amend the Rating List and serve a notice of that decision on the Proposer and the Ratepayer (if he is not the Proposer) (Reg 10). No formal Decision Notice under Reg 13 is required.

Once a proposal has been well founded then there is no right to appeal to VT or for subsequent new IPs to challenge the revised list entry.

The VO may alter the list in accordance with the proposal (effectively well founding the proposal) after an appeal has been made to the VTE (under Reg 13A). The VO should then notify the VTE of the fact. The appeal will then be treated as withdrawn on the date on which notice is served on the VTE (SI 2009 / 2269 Reg 19a (7)). No consent order for this alteration is required.

A proposal cannot be well-founded at a RV other than the figure in the proposal. If the VO alters the list at a different figure, whether higher or lower than that proposed (also includes rounding) then that is an alteration under Reg 13 (3)(a)(ii) or 13(3A)(a)(ii) and the agreement process should be followed (see below).

A proposal made by the landlord may be well founded by the VO. However, in this circumstance the ratepayer (occupier) has no involvement in this process. It is therefore a matter of best practice that in the event an IP or former IP proposal is made which the VO would normally well found, that the alteration should be agreed with the ratepayer and the agreement process followed below rather than well founding.

7.2 Withdrawal

A proposal may be withdrawn by the Proposer by notice sent to the VO at any time before the case is determined.

If the proposal was made by a ratepayer and he is now no longer the ratepayer, then the agreement of the new ratepayer in writing is required before the proposal may be withdrawn (Reg 11 (1 & 2)). If he disagrees, then a Decision Notice must be issued.

As the new ratepayer would not have been competent to make the proposal at the time it was made, he is not able to become a substitute proposer.

A person who is an IP at the date of proposal, or any person (P) who was an IP on the date of confirmation of check and the date of the proposal, may opt in to the proposal by notifying the VO within 2 months of date of receipt of the proposal by the VO, that they wish to become a party. The VO must then send notice of the withdrawal to those parties as well (Reg 11(3)). The signature of the opted in parties is not required in respect of the withdrawal unless it is required in another capacity.

The opted in IP then has 6 weeks from receipt of the withdrawal notice to contact the VO in writing stating that they object to the withdrawal. Only a person who was an IP at the date the proposal was made can object to the withdrawal and the party will be treated as if they had made the proposal on the same terms as the original proposal. The Effective Date of any change to the rating list is the same as that of the original proposal (Reg 11(4)).

Person (P), who was not an IP at the date of the original proposal may not take over as substitute proposer.

The effect of this provision (Reg 11 (4)) means that if an opted in party (not the proposer) objects to the withdrawal then they are deemed to take over the proposal. The proposal is then deemed to be made on the date the IP objection is received by the VO and the time limits for proposal would be calculated from that date regarding the service of notices etc. The content and detail of the new proposal is the same as the original proposer’s and the eighteen month deadline for the VO to complete the challenge stage restarts. The Effective Date and Material Day are the same as those in the original proposal.

If there is an objection by one of the IPs to the withdrawal and they become the substitute proposer it will then be necessary to reinstate and re- register the proposal in accordance with Reg 11(4).

There is no requirement in the regulations to discuss or exchange the evidence received under Reg 9 with the substitute proposer. The opportunity for them to submit evidence was during the challenge discussions, there is no provision for further evidence to be introduced at this stage. A Decision Notice should be issued against which he may appeal.

Any alterations which occur as a result of the new proposal have the same effective date as if the original proposal had not been withdrawn.

In the case where an IP has taken over a Proposal in accordance with Reg 11(4), if subsequently the proposal is not settled and a Decision Notice is issued then that IP will have the right to make an appeal to the VT if he so wishes as a ‘substitute proposer’.

CCA Sub-Process 3.4.20.01 et seq Withdraw Challenge Case deals with this, however for further advice of the process for dealing with opted in IPs and substitute proposers please refer to CCA Technical Process Team

7.3 Agreed alterations

To agree a proposal all the following persons must agree in writing to the list alteration

(Reg 12):-

a) VO,

b) Proposer,

c) Occupier of the hereditament at the date of proposal

this excludes the occupier of the hereditament who is no longer in occupation of any part of it at the date of agreement, provided the VO has taken all reasonable steps to ascertain their whereabouts,

d) the ratepayer at the date of agreement,

e) an IP or any person who was an IP on the date of confirmation of check who is party to the appeal because they have notified the VO within 2 months of date of receipt of the proposal that they wish to be a party, but excludes any IP who cannot be contacted at the address supplied to the VO,

f) any person who was at the date of check, an IP and has notified within 2 months of the VO receiving the proposal that he wishes to be a party

The VO then has 2 weeks after the day on which the agreement was made to amend the rating list. The proposal will then be treated as being withdrawn.

If an occupier has, since the proposal was made, ceased to occupy the property which is the subject of the proposal and cannot be contacted, despite the VO taking all reasonable steps to do so, their consent to the agreement is not required (Reg 3(a)).

Where an agreement has been reached, the Challenge is treated as having been withdrawn and cannot subsequently be appealed (Reg 12(1)(b)).

If for any reason the VO is unable to get the agreement of all the required parties (under Reg 12 (2)), then the VO should make the appropriate amendment to the Rating List and issue a Decision Notice explaining the situation with reasoning (as per Reg 13 (1)) to all the interested parties to the proposal as per Reg 13(2)(c). eg in the case of splits of assessment

Under Reg 13A (1) ‘a proposer’ may appeal to the VTE, i.e. the person making the proposal.

Reg 12 Identifies the parties whose signatures are required to complete the agreement form. If any such party objects to the agreement so that the Proposal cannot be settled then the VO should issue a decision notice in accordance with Reg 13.

Under Reg 13A, only the Proposer (or deemed substitute in the case of opposed withdrawals, Reg 11(4)) has a right to make an appeal to the VT following the issue of the Decision Notice. The other IPs do have a right to become parties to the appeal although they cannot make an appeal in their own right (Reg 2(3)).

7.4 Other Alterations

If the VO decides to alter the list otherwise than as indicated in the proposal then this should be done as soon as reasonable after the decision has been made (Reg 13(5)).

This alteration should then be referred to in the Decision notice.

8 DECISION NOTICE

If the Proposal cannot be well founded or resolved by agreement or withdrawal the VO will need to issue a Decision Notice.

The VO will amend the Rating List if appropriate and issue the Decision Notice.

All particulars and issues raised in the proposal should be addressed in the notice together with evidence on which the VO intends to rely, as no further evidence may be submitted at the appeal stage except in exceptional circumstances.

All evidence submitted by the Proposer during the challenge stage, as outlined below, forms part of the proposal (Reg 9(12)).

This is important as the evidence will be included as part of the proposal submitted to the Tribunal as part of the appeal process and no further evidence may be admitted except in limited circumstances (Reg 17A).

All correspondence and communications, written or verbal, should therefore be suitably addressed and documented as these will be included in any Appeal documents before the VT.

If evidence is still subject to review please, see evidence appears incorrect.

If the rating list needs to be amended this should be done prior to the issue of the Decision Notice. The ability to submit further evidence at the appeal stage is extremely limited and cannot be relied on to admit evidence that should have been agreed prior to the Decision Notice.

8.1 Issue of Decision Notice

The VO can decide a case without agreement if:

a. it disagrees with a Challenge; and

b. considers the current list to be accurate; or

c. considers that an alteration is justified but a negotiated agreement cannot be reached.

d. the Proposer no longer exists

Having reached a decision and the proposal is not well-founded, agreed or withdrawn, the VO must as soon as reasonable after making his decision, amend the list if appropriate and serve a Decision Notice (Reg 13).

Once a Decision Notice has been issued it cannot be rescinded or re-issued due to the window for appeal being triggered.

8.2 Time limit for issue of Decision Notices

The VO has up to 18 months from the date of receipt of a proposal to issue a Decision Notice, before a right to appeal automatically arises and the proposal has not been determined (well founded, agreed or withdrawn). The VO may agree a longer period than 18 months in writing with the Proposer (Reg 13A(1) (c)(iii)) if appropriate.

8.3 Service on Parties

The notice must be served on:

(Reg 13(2)

a) the Proposer,

b) the Ratepayer (if not the proposer),

c) any IP (party to the appeal as per Reg 12(2)e) or an person who was an IP at the date of confirmation of check and is no longer there and have notified they wish to be party to the appeal,

d) the Relevant Authority provided they have served notice that it wishes to receive a copy of the decision (see Reg 13 (2)(d)).

It is important the opted in IPs are correctly identify and receive the correct notices. Please refer to CCA T018 challenge correspondence assessment tool which covers the process to be followed.

8.4 Content of Decision Notice

The decision notice must contain (Reg 13(3)):

A statement that the VO is of the opinion the proposal is not well-founded and

a) the VO disagrees with the proposed alteration and that either the list will not be altered or will be altered differently,

b) the reasons for that decision, including a statement of evidence and information used to make that decision,

c) a statement in relation to each ground setting out why it is not made out, as well as a summary of any particulars with which the VO disagrees,

d) the proposer’s right of appeal against the decision.

It should not contain any new evidence that has not been the subject of discussion during the challenge stage.

8.5 Rental Evidence

Any rental information contained in the Decision Notice must have been included in the evidence exchange during challenge and also fully compliant with the Reg 17 (Appeal Regulations SI 2009/2269) requirements regarding the use of FORs and rights to view further FORs allowed for during the Challenge period. (See RM Chapter 8 for further guidance on Reg 17 evidence). Best practice is that the Reg 17 evidence should be included in the initial response.

No new rental information that is not already disclosed during challenge, should be referred to in the Decision Notice.

Evidence held on FORs and SDLTs will carry the greater weight at any hearing and so that source should be the preferred source of rental information. The use of Costar or other sources of information are less reliable and of limited use in the context of hierarchy of evidence.

Should the proposer, after issue of the Decision Notice, request to view FORs and introduce additional evidence from those FORs, the admissibility of this evidence should be challenged and refused on the basis that this evidence could reasonably have been acquired during the challenge period and does not satisfy the requirements of ‘new evidence’ (Reg 17 SI 2009/2269). (There may be exceptional circumstances due to difficulties of access, for example, due to closure of offices due to COVID 19, in these case please refer to your technical advisor for advice on how to proceed).

8.6 Service of Decision Notice

It is important the opted in IPs are correctly identify and receive the correct notices. Please refer to CCA T018 challenge correspondence assessment tool which covers the process to be followed.

For further advice of the process for dealing with opted in IPs please refer to CCA Technical Process Team

(a) On the proposer, ratepayer or an opted in IP who is still an IP when the DN is issued.

Notification must include:

(Reg 13(3)(a))

(a) a statement that the VO is of the opinion that the proposal is not well founded, that the VO disagrees with the proposed alteration of the list and that the VO has decided

(i) not to alter the list according to the proposal; or

(ii) to alter the list otherwise than in accordance with the proposal; and

(b) the reasons for that decision,

(c) a statement regarding each ground of the proposal why the ground is not made out and a summary of particulars in disagreement, and

(d) details of the Proposer’s right to appeal the decision.

This requirement includes the provision of detailed explanations of the evidence and considerations behind the decision in the notice.

(b) Notification to an Opted In IP who is not an IP by the time a DN is served (Reg 13 (2)(c) subject to 13(3A)) (ie has now become a former IP)

Notification must include:

(a) a statement that the VO is of the opinion that the proposal is not well founded, that the VO disagrees with the proposed alteration of the list and that the VO has decided

(i) not to alter the list according to the proposal; or

(ii) to alter the list otherwise than in accordance with the proposal; and

(b) reasons for that decision.

(c) Service on Relevant Authorities (Reg 13(2)(d))

If the Relevant Authority has served notice on the VO stating that it wishes to receive a copy of the decision notice regarding

(a) the proposal

(b) any proposal relating to the hereditament to which the subject proposal relates or

then the Decision Notice provided to the Relevant Authority (Reg 13(4)) must contain

(a) a statement that the proposal is not well founded and the VO disagrees with the proposed alteration and has decided not to alter the list or alter it differently,

and where the VO considers it reasonable to do so

(b) the reasons for that decision, statement of evidence used, reasons why each ground was not made out and areas of disagreement.

The VO policy currently is that it is not reasonable to include (b) because that would share excessive data and information with the RA.

It should include the name of the document being referred to, the property to which the information relates and the information to be relied on together with rights of inspection of the documents. This also should have been included with the initial response notice in order to give the proposer chance to consider the evidence during the challenge stage.

Please follow the CCA processes for correspondence in this scenario. Customer Correspondence 5.1 the caseworker should then view case notes etc and send a copy of DN if BA have opted in, the T018 tool. For further advice of the process for dealing with BAs please refer to CCA Technical Process Team

8.7 Decision Notice not issued

If eighteen months elapse from the date a Proposal is made without an agreement, withdrawal or decision, the proposer can Appeal to the VTE without waiting for resolution from the VO. The VO and the proposer can agree in writing to extend this eighteen month time limit (Reg 13A(1) (c)(iii)).

8.8 Re-Issue of Decision Notice - clerical errors and late evidence

Once issued, a Decision Notice concludes the challenge for the hereditament and the time limits for appeal are triggered.

The Decision Notice should not be re-issued or the case re-instated once the notice has been served.

Only if Decision Notice was unlawful - ie did not meet the statutory requirements should it be re-issued but this must be discussed with your technical leads first and the circumstances explained to the proposer.

If there is a clerical error in the Decision Notice and addendum should be added to the notice clearly explaining the error and showing the correct information to apply. This should be sent within 1-2 days of the original notice being sent. If the case proceeds to appeal a document should be prepared explaining the changes and a request made under Reg 17A for inclusion of this information at appeal.

If further evidence is received by the caseworker from the Proposer, eg information crossed in the post, then the caseworker should consider the challenge in its entirety in the light of this new evidence and follow the appeal protocols on the CCA home page - seek approval from the Unit Head to amend the list if appropriate.

Notification of the change or if no change is to be made to the list entry this should be explained to the Proposer and in the event of an appeal being made an application should be made by the caseworker under Reg 17A should be made to the VT to include both documents as evidence on appeal.

In the event that the list has been altered after the decision notice has been sent, the CDB should be clearly documented that the alteration was as a result of the proposal and therefore this will affect the subsequent rights to submit a challenge against the alteration under Reg 4(3)(c).

Further guidance on this may be found on the CCA homepage.

RIGHTS OF THE PARTIES DURING CHALLENGE

8.9 Billing Authorities

Right to make proposals

Billing Authorities do not have the right to make Proposals or Appeals or be party to a Proposal or Appeal unless they qualify as an interested person.

Notifications to BAs - Proposal and Decision Notice

However the VO is still required to notify the Relevant Authority on receipt of the proposal (Reg 9(1)) and the determination of the proposal (Reg 9(4)) within 6 weeks and provide certain information regarding the proposal. This is usually done by VO weekly schedules.

Additional information held by the BA eg Completion Notice information

During Challenge having received notification of the proposal the Relevant Authority may provide the VO with additional information for consideration. The VO must then provide this to the Proposer who can provide further evidence in response (Reg 9(6)).

This is of particular importance in respect of proposals relating to completion notices whereby evidence held by the BA will provide fundamental facts as to the state of the property etc. for the VO when considering the initial response and decision notice.

Following the evidence provided by the BA, they may become a witness at any future appeal hearing. It is therefore useful for the caseworker to establish who the potential witness would be for the authority, storing the confirmation email in CCA caseworker suite and a note made on RSA remarks.

Under The Non-Domestic Rating (Compilation and Alteration of Lists) (England) Regulations 2020 SI 2020/1403 the BA is required to supply the VO with a list of occupiers on a quarterly basis.

Party to proposals

In the case of Proposals for deletion (Reg 4(1)(h)) regarding Completion Notices, the BA cannot be a party to the Challenge, unless it is a property for which they are actually an interested or former interested party.

Becoming a party at Appeal stage

Reg 11(2) SI 2009/2269 allows the VTE to give a direction to add a person as a party, to the proceedings. Unless the BA is an IP they cannot be added as a party at appeal stage. If the VO does not include the BA evidence at challenge stage then the rules as to submission of new evidence under Reg 17A would apply (essentially, this new evidence is likely only to be admitted if all parties agree).

If a person is made a party to an appeal at VT stage and appears at the hearing, then they have the right to make an appeal to the UT in the event of an adverse decision.

However, in a recent VTE case concerning a completion notice (CHG 100047531) the VTE refused to add the BA as a party.

Therefore it is essential that the VO should include BA evidence in the Initial Response and also in the Decision Notice, so if necessary, the BA may be called as a witness at any hearing. This could be important if the validity or service of a Completion Notice is being challenged by a proposal for deletion.

For further advice of the process for dealing with BAs please refer to CCA Technical Process Team

Decision Notices

The BA is entitled to receive a shortened decision notice if they have served a notice on the VO that they wish to receive a copy of that notice in relation to the proposal, hereditament or class of property.

8.10 Current Ratepayers who are not the Proposer

Vacant property

The landlord is the ratepayer if the property is vacant (Reg (2)).

Service of copy of Proposal

If the ratepayer is not the proposer then the VO must serve a full copy of the proposal on them within 6 weeks of receipt (Reg 9(1)).

Party to a proposal

To be a party to a proposal the Ratepayer must have opted in within 2 months of receipt of the proposal by the VO.

Well-founded Proposals

The VO has to serve a notice on the IP of the well founding decision as soon as possible after making that decision.

There is no right of objection or appeal against well founding of a proposal.

The Current ratepayer will be bound by the outcome of the well-founded proposal and cannot make a further proposal in respect of that change.

Withdrawals

The signature of the current ratepayer is required if the proposal was made by a former ratepayer or former IP (Reg 11(2)). It is not required for withdrawals of proposals made by current landlords who have never been the ratepayer.

If the ratepayer has ‘opted in’, they can notify the VO within 6 weeks of the notification of withdrawal and then take over the proposal as a ‘substitute proposer’ (Reg 11(4)).

If the ratepayer has not opted in but refuses to sign the withdrawal the VO should issue a Decision Notice.

The ratepayer will have no right of appeal (unless he is a substitute proposer) but will be party to any appeal submitted by the Proposer to the VTE by virtue of Reg 2(3).

Agreements

The signature of the ratepayer at the date of agreement is required (Reg 12(2)(d)).

If the ratepayer disagrees then the VO issues a decision notice.

If the ratepayer has also ‘opted in’ then their agreement would also have been required by virtue of Reg 12(2)(e) unless they cannot be contacted at the address provided Reg 12(3)(b).

There are no rights to take over the Proposal, in the event of disagreement by the ratepayer. The VO in this circumstance should issue a decision notice.

The ratepayer will have no right of appeal but will be party to any appeal submitted by the Proposer to the VTE by virtue of Reg 2(3).

Decision Notice

The VO must serve a full copy of the decision notice on the Ratepayer. The requirements are set out in Reg 13(2)(b).

8.11 Landlords & former landlords / occupiers (who are not proposers but were present at date of confirmation of check)

Proposals

Such IPs may make proposals on all grounds under Reg 4(1) provided they made a check request during the time they were an IP and the proposal is relevant to the time for which they were an IP (Reg 4(2)(aa)).

Copies of Proposals

There is no requirement for the VO to serve copies of Proposals on receipt to landlords or former occupiers.

‘Opting In’ as a party

To become a party to a proposal the landlord or former occupiers, present at date of check, must opt in by notifying the VO within 2 months of receipt of the proposal that they wish to be a party.

Well Founded Proposals

If the VO well founds a proposal, the landlord or former occupier has no rights to object or appeal the decision.

Withdrawals

The signature of the landlord or former occupier is not required unless they have opted in to the proposal.

If the landlord or former occupier has ‘opted in’, they can notify the VO within 6 weeks of the notification of withdrawal and then take over the proposal as a ‘substitute proposer’. (Reg 11(4)) and submit an appeal if they wish following a decision notice.

Agreements

If the landlord has ‘opted in’ then their agreement would also have been required by virtue of Reg12(2)(e) unless they cannot be contacted at the address provided Reg 12(3)(b).

If the former occupier has ‘opted in’ then their agreement is also required (Reg 12(2)(e)) unless all the other parties required to sign the agreement have agreed and the VO has taken all reasonable steps to ascertain their whereabouts and they cannot be ascertained (Reg 12 (3)(a)).

There are no rights for the landlord or former occupiers to take over the Proposal, in the event of disagreement. The VO in this circumstance should issue a decision notice.

The landlord or former occupiers will have no right of appeal but may be party to any appeal submitted by the Proposer to the VTE by virtue of Reg 2(3) if they have opted in.

Decision notices

If the parties have opted in then the VO musts serve a copy of the decision notice on them (Reg 13(2)(c)). If this party at the time of service of the decision notice no longer has an interest in the property then a shortened version of the notice should be sent.

8.12 Landlords or former occupiers/ landlords, not present at the date of request or confirmation of check

Proposals

If the landlord or former occupiers were not present at the date of check then the grounds on which a proposal may be made are limited to Reg 4(1)(c), (d) and (f). i.e. P&M, VO alteration and Effective day correction. They cannot make a proposal relating to PICO legislation for merger as this would fall under Reg 4(1)(k) and therefore would be unlawful.

‘Opting in as a Party’

As the person was not an IP at the date of check they cannot ‘opt in’ to a proposal.

Well founded

There are no rights for persons not present at the date of check against a proposal being well founded.

Withdrawals

If the party was not present at the date of the check then they cannot opt in, they are not party to the proposal and cannot become a substitute proposer.

Agreements

Their agreement is not required unless they are the proposer.

They cannot opt in and have no rights of appeal.

Decision Notice

There is no requirement for the VO to serve a copy of the Decision Notice on this party unless they are actually the proposer.

Rating Manual section 6: check, challenge, appeal and proposals

Part 8C: Challenge stage

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Part 8C: Challenge stage

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