A large factory was no longer required by the original occupiers and was empty because an alternative occupier had yet to be found. The valuation court had reduced the assessment of rateable value to pounds 50,000. The Valuation Officer contended upon the appeal to the Lands Tribunal that the true rateable value was pounds 200,000. There was no cross appeal by the ratepayer seeking to challenge the assessment of pounds 50,000 and to argue that a lesser figure or nil figure was appropriate.
The Tribunal stated: ‘As a valuation for rating purposes is based upon the concept of the value of the occupation it is not surprising that the solution is not always easy to find when the premises are empty. If I may paraphrase what the Member (Mr J H Emlyn Jones FRICS) said in the Lands Tribunal decision of Lambeth London Borough v English Property Corporation Ltd and Shepherd (VO), the mere fact that premises are unoccupied does not of itself justify a lesser value than that applicable to similar premises which are occupied. In a parade of shops where one shop remains unoccupied one would expect to find similar values applicable to all shops possessing similar characteristics on the assumption that the hereditaments were broadly identical. I would add that other considerations arise where empty premises are materially different from those which are occupied and where it can be shown that the premises remain empty because of lack of demand. In the instance case the evidence of the attempts to market the premises and the records of enquiries received suggests that there was no prospective occupier available in the open market and, if that be so, it is difficult to see that the premises can have any annual value; but first it is necessary to examine closely the evidence of lettings and agreed assessments of comparable premises to see if this evidence is to be preferred.’
The Tribunal stated: ‘None of this evidence appears to contradict or modify the view that the appeal premises in their existing state have reached the end of their economic life in that the previous occupiers have no use for them and no prospective occupiers have been found after a very thorough search of the market. Although built in the mid-1950’s, workshop units of this size and type appear to be no longer in demand. The premises cannot readily be used for warehouse or distributive warehouse purposes without major alterations. The future use of the premises appears to depend upon the creation of a hereditament, or hereditaments, different from the existing. It 18 seems to me, therefore, that in rating terms the premises have ceased to have any value.’
Judges:
C R Mallett Frics
Citations:
[1985] RA 36
Jurisdiction:
England and Wales
Cited by:
Cited – Telereal Trillium v Hewitt (Valuation Officer) SC 15-May-2019
The court considered correct approach to determination of the rateable value of an office building, in circumstances where the evidence showed at the relevant time a general demand in the area for comparable office buildings, but no actual tenant . .
Lists of cited by and citing cases may be incomplete.
Rating
Updated: 09 February 2022; Ref: scu.671897