Business rates are not due on all rateably unoccupied hereditaments in England. There are some exemptions contained in Non-Domestic Rating (Unoccupied Property) (England) Regulations 2008 (SI 2008/386) (the 'Unoccupied Property Regs 2008')[1], made applicable through the need to satisfy section 45(1)(d) of the Local Government Finance Act 1988, section 45 ('LGFA 1988') for any business rates to be due.
This article will focus on one of those exemptions, namely the exemption from business rates (i.e. national non-domestic rate) for rateably unoccupied listed buildings, contained in regulation 4(e) of the Unoccupied Property Regs 2008. The Unoccupied Property Regs 2008 only apply to hereditaments (units of property for business rates tax purposes) situated in England. Wales has different exemption regulations[2a].
The article will consider the cases of: (1) Providence Properties Ltd v Liverpool City Council [1980] Lexis Citation 733; [1980] RA 189 ('Providence Properties'); (2) Debenhams Plc v Westminster City Council [1987] AC 396 [1986] 3 WLR 1063 ('Debenhams'); and (3) Ge Bowra Group Ltd v Thanet DC [2007] EWHC 1077 (Admin); [2007] RVR 120 ('Bowra').
It might be helpful to first set out how reg.4(e) creates a 'listed' building exemption from unoccupied business rates.
Local Government Finance Act 1988
Section 45 of the LGFA 1988 imposes liability to pay business rates where a hereditament is rateably unoccupied (colloquially known as 'empty property business rates'). Subsection (1) of section 45 provides:
‘A person (the ratepayer) shall as regards a hereditament be subject to a non-domestic rate in respect of a chargeable financial year if the following conditions are fulfilled in respect of any day in the year-
(a) on the day none of the hereditament is occupied,
(b) on the day the ratepayer is the owner of the whole of the hereditament,
(c) the hereditament is shown for the day in a local non-domestic rating list in force for the year, and
(d) on the day the hereditament falls within a class prescribed by the Secretary of State by regulations.’
The above 4 conditions are cumulative. In other words, if one of them is not satisfied, that business rates are not due.
The relevant condition for the purposes of this article, is the fourth condition, namely, that 'on the day the hereditament falls within a class prescribed by the Secretary of State by regulations.'
Hereditament Classes - Prescribed by the Secretary of State by regulations
The relevant regulations here (as stated above) are Unoccupied Property Regs 2008, a set of regulations that came into force on 1.4.08[2b]. Reg.3 of the Unoccupied Property Regs 2008 states:
'The class of non-domestic hereditaments prescribed for the purposes of section 45(1)(d) of the Act consists of all relevant non domestic hereditaments other than those described in regulation 4.'
The noun phrase 'relevant non-domestic hereditament' is defined in reg.2 of the Unoccupied Property Regs 2008 (a reg. entitled 'Interpretation'), as:
'“relevant non-domestic hereditament” means any non-domestic hereditament consisting of, or of part of, any building, together with any land ordinarily used or intended for use for the purposes of the building or part;'
The upshot is that all relevant non-domestic hereditament are prescribed (so section 45(1)(d) condition is satisfied in respect to the particular hereditament) except for those described in reg.4 of the Unoccupied Property Regs 2008. In other words, any business rates hereditament falling within a description/circumstance set out in reg.4 of the Unoccupied Property Regs 1989 is exempt from ratebly unoccupied business rates ('Rateably Unoccupied Business Rates'). Conversely, if the hereditament does not falling within a description/circumstance set out in reg.4, then the hereditament is prescribed for the purposes of section 45(1)(d).
Regulation 4 - Relevant Descriptions
Reg.4 of the Unoccupied Property Regs 2008 is entitled 'Hereditaments not prescribed for the purposes of section 45(1)(d) of the Act' and commences:
'The relevant non-domestic hereditaments described in this regulation are any hereditament...
There is then a list of 12 subregulations[2c], but for present purposes, the relevant one is reg.4(e), and the description/circumstance it contains. Or, to be more precise, the descriptions / circumstances, it contains, because it actually contains 2 different descriptions/circumstances[2d], and so exemptions. It is the second part of reg.4(e) that is relevant.
Regulation 4(e) - is included in a list compiled under section 1 of the Planning (Listed Buildings and Conservation Areas) Act 1990
The second part of reg.4(e) contains the following relevant description / circumstance: where the hereditament '...is included in a list compiled under section 1 of [the Planning (Listed Buildings and Conservation Areas) Act 1990]'
In other words, a hereditament will be exempt from rateably unoccupied business rates where (and for so long as) as 'it' is included in a list complied under the Planning (Listed Buildings and Conservation Areas) Act 1990.
Predecessor Provisions to Regulation 4(e)
Before turning to the Planning (Listed Buildings and Conservation Areas) Act 1990 and the caselaw, and indeed a preliminary point about a drafting error in the statutory instrument, it should be noted that:
(1) reg.4(e) is the successor to some older, very similar, provisions. The exemption's previous statutory incarnations are:
(a) paragraph 2(2)(d) of the Non-Domestic Rating (Unoccupied Property) Regulations 1989 (SI 1989/2261) ('1989 Regulations')(now obsolete)[3]; and
(b) paragraph 2(c) in Schedule 1 to the General Rate Act 1967 (now obsolete)[4].
It is relevant to know this because some of the caselaw was decided on the previous incarnations of this exemption.
(2) section 1 of the Planning (Listed Buildings and Conservation Areas) Act 1990 is the successor to section 54 of the Town and Country Planning Act 1971[5]
Liberal Interpretation to Surmount Drafting Error
The reason for referring to 'it', in inverted commas, in the paragraph above, and the preliminary point referred to above, is that there is a well-recognised drafting error in the statutory instrument, the Unoccupied Property Regs 2008. The drafting error relates to the difference between: (1) hereditaments; and (2) buildings, and the true construction of this exemption.
The drafting error was identified by Lord Keith in Debenhams v Westminster City Council [1987] AC 396 ('Debenhams'), a decision of the House of Lords, in respect to reg.4(e)'s predecessor, paragraph 2(c) in Schedule 1 to the General Rate Act 1967[6]. In Debenhams, at page 404G, Lord Keith said:
'The construction of paragraph 2(c) presents difficulty owing to the draftsman, as it would appear, not having kept in view the distinction between a hereditament and a building. It is buildings, not hereditaments ...which are included in lists compiled under section 54. Although a hereditament may consist in a building and no more, there are a great many hereditaments which comprise a building and also something more, even if only a small garden or yard.'[7]
In Ge Bowra Group Ltd v Thanet DC [2007] EWHC 1077 (Admin); [2007] RVR 120 ('Bowra'), a listed building case rather than a building preservation case (but relevant to both circumstances), Irwin J quoted the above passage from Lord Keith in Debenhams, and commented, at paragraph 17, that:
'...there are many buildings which consist of more than one hereditament...The difficulty arises from the drafting.'
One would have thought that this drafting inadvertence would have been corrected, when a new version the exemption was published. However, it was not (twice). Consequently, the drafting inadvertence that: (1) was first identified in Debenhams in paragraph 2(c) in Schedule 1 to the General Rate Act 1967; (2) was reproduced in paragraph 2(2)(d) of 1989 Regulations, as Bowra spotted; and (3) was reproduced again, in reg.4(e) of 2008 Regulations (the current incarnation).
It may be that the drafting inadvertence was not remedied, at least in the 2008 Regulations, because the judgment in Bowra had already found a sensible interpretation, that solved the problem.
However, before turning to Irwin J's judgment, and the sensible interpretation he found in Bowra, attention shall be turned to Providence Properties.
Providence Properties
This case was decided by the Divisional Court (Lord Lane LCJ and Boreham J) when paragraph 2(c) in Schedule 1 to the General Rate Act 1967 applied. The case concerned a warehouse area, a part only of which was also designated as a 'listed building' within the meaning of section 54 of the 1971:
(1) The hereditament consisted of '...three warehouse buildings some six stories high, the two outer of which are linked to the central warehouse by single storey buildings and a detached gateway abutted by two gate houses.' paragraph 3).
(2) The 'listed building' area consisted of 'the central warehouse block with tower situate on the north east corner thereof together with the gates and gate houses' (paragraph 4)
The hereditament was unoccupied at the material times (liability periods 1974-1975 and 1975-1976) (paragraph 5). The business rates were demanded, and when they were unpaid, a summons was issued. Before the Magistrates Court, the alleged ratepayer argued that '...no rates were payable in respect that hereditament, it being unoccupied and part of it being included as a "listed building" under [the 1971 Act].' (paragraph 7). The Magistrates Court disagreed. The alleged ratepayer appealed to the Divisional Court.
In the Divisional Court, counsel for the alleged ratepayer argued that the '...hereditament ... comprised at least in part a building which was listed under [the 1971 Act]' (paragraph 11) and '...that that is sufficient...to absolve ... his client from the obligation to pay rates' (paragraph 11).
Boreham J (with whom Lord Lane J agreed[8]), after referring to an argument made that 'hereditament' could be read 'hereditament or any part thereof' (paragraph 17), said, at paragraphs 18 to 20:
'In my judgment the meaning of paragraph 2(c) is clear. If Parliament had wished paragraph 2(c) to apply to part of a hereditament, it could have said so and said so very easily in the way [counsel for the alleged ratepayer] demonstrated, by the inclusion of thoe [sic] few words. They were not included. In my judgment the meaning is clear. One simply asks the question What was the hereditament in this case? Was that hereditament in the list under section 54 of the Town and Country Planning Act 1971? The answer to that question seems to me to be clear. That hereditament was not in that list. A bit of it was. That is not enough.' [bold added]
In other words, for a hereditament to be 'listed', and so exempt from rateably unoccupied business rates, the whole of the land within the hereditament must be within the land that is listed. If only part of the land in the hereditament is part of the land that is listed, then the hereditament does not qualify as 'listed' and so does not qualify for any exemption from rateably unoccupied business rates on the basis that it is listed.
Bowra
Irwin J in Bowra fortified this interpretation of the relevant exemption (then as paragraph 2(2)(d) of 1989 Regulations). Irwin J fortified this conclusion by:
(1) quoting, at paragraph 16, Lord Keith in Debenhams, from 403D: 'In resolving a statutory ambiguity, that meaning which produces an unreasonable result is to be rejected in favour of that which does not, it being presumed that Parliament did not intend to produce such a result'; and
(2) stating, at paragraphs 18 and 19 of Bowra, that:
'...the correct analysis here is that since a hereditament cannot in the strictest sense be listed, for the Regulations to require a hereditament as such to be listed would be impossible, I must therefore interpret the term "included" in paragraph 2(2)(d) of the Regulations to mean something a little more liberal than "named".
In my judgment, common sense, policy and a perfectly respectable use of language come to the same point. The Regulation means that where a hereditament is wholly included within a building which is listed, exemption should follow.' [bold added][5b]
So Irwin J in Bowra reached the same conclusion as the Divisional Court in Providence Properties, namely that a hereditament is only exempt under this exemption, where the 100% of the land in the hereditament is within the land that is listed. Otherwise, the exemption does not apply.
Listed Building
The next question will be: well what land is listed?
Prime facie, whether or not a building is a Listed Building, should be easy to determine. Pursuant to section 2 of the 1990 Act, the relevant public bodies are required to disseminate the contents of the List. This includes, making it available for public inspection (section 2(4) and 2(5)). Further, under section 2(3)(b)), the council must:
'...serve a notice in the prescribed form on every owner and occupier of the building, stating that the building has been included in or excluded from the list.'
In The Queen on the Application of Burnley Borough Council v Huron Properties Ltd [2016] EWHC 3803 (Admin) ('Huron'), after quoting the second part of reg.4(e), Kerr J set out the following, at paragraph 15:
'That is the provision governing what are well known as listed buildings. A listed building is, under section 1(5) of the 1990 Act:
"a building which is for the time being included in a list compiled or approved by the Secretary of State under this section …".'
A few points can be made here:
(1) Whether or not a building should, or should not, be included on this list, is a separate matter[9].
(2) As to what the 'building' is, Kerr J noted in Huron, that it was common ground between the parties that:
'References to a building ... fall to be construed by reference to the definition of that word in section 336(1) of the Town and Country Planning Act 1990, which states that a building "includes any structure or erection, and any part of a building, as so defined …" (paragraph 16)
(see House of Lords in Shimizu (UK) Ltd v Westminster City Council [1997] 1 WLR 168, [1997] 1 All ER 481 ('Shimizu').
(3) Listed Building is what is listed on the list, and additional elements as stipulated by section 1(5) of the 1990 Act. Section 1(5) of the 1990 Act reads:
'In this Act “listed building” means a building which is for the time being included in a list compiled or approved by the Secretary of State under this section; and for the purposes of this Act—
(a) any object or structure fixed to the building;
(b) any object or structure within the curtilage of the building which, although not fixed to the building, forms part of the land and has done so since before 1st July 1948,
shall, subject to subsection (5A)(a), be treated as part of the building.
(5A) In a list compiled or approved under this section, an entry for a building situated in England may provide-
(a) that an object or structure mentioned in subsection (5)(a) or (b) is not to be treated as part of the building for the purposes of this Act;
(b) that any part or feature of the building is not of special architectural or historic interest.’ [bold added]
So, subject to:
(a) express entry on the list, excluding a particular object or structure, or
(b) any part or feature of the building is not of special architectural or historic interest,
certain objects and structure are to be treated as part of the listed building. Such depends on whether:
(a) the object or structure is 'fixed' to the listed building, or
(b) within the curtilage of the building (but not fixed), and which forms part of the land and has done so since before 1st July 1948.
'Structure' here has a special defined meaning. In Debenhams, the meaning of ‘structure’, as appearing in s.1(5)(a) and (b), was defined. Lord Keith in Debenhams said:
'In my opinion to construe the word ‘structure’ here as embracing a complete building not subordinate to the building of which it is to be treated as forming part, would...indeed produce an unreasonable result…'
And later, he said that he was satisfied that ‘...the word ‘structure’ is intended to convey a limitation to such structures as are ancillary to the listed building itself, for example the stable block of a mansion house, or the steading of a farmhouse, either fixed to the main building or within its curtilage. In my opinion the concept envisaged is that of principal and accessory.'
See also (a) Morris v Wrexham County Borough Council [2001] EWHA Admin 697[10] on 'within the curtilage'; and (b) Richardson Development Ltd v Birmingham City Council [1999] RVR 44 [1999] JPL 1001[11] for an illustration of whether wings are ancillary to the central/core part.
(4) the Secretary of State can list part of a building, see (a) Shimizu as authority for this proposition; also (b) Huron, paragraph 18[12].
(5) In determining exactly what is Listed, Kerr J in Huron summarised the case of City of Edinburgh v Secretary of State for Scotland [1997] 1 WLR 1447, [1997] 3 PLR 71 ('City of Edinburgh'), extracting that City of Edinburgh is authority for the proposition that:
'...the court can, if necessary, look beyond the name of the building as given in a listing entry, in a case where the name alone creates ambiguity; and in such a case the court can look beyond it to the descriptive elements in the listing entry to resolve such ambiguity.'[13]
See also Barratt v Ashford Borough Council [2011] P & CR 21[14]
Summary
In summary, for the hereditament to be exempt from business rates under regulation 4(e) of the Unoccupied Property Regs 2008, 100% of the land within the hereditament must be within the listed building land (Providence Properties; Bowra) (whether as land upon which there is the listed building, or by reason of the treating provision in Section 1(5) of the 1990 Act). Otherwise, the exemption will not apply.
SIMON HILL © 2023*
BARRISTER
33 BEDFORD ROW
NOTICE: This article is provided free of charge for information purposes only; it does not constitute legal advice and should not be relied on as such. No responsibility for the accuracy and/or correctness of the information and commentary set out in the article, or for any consequences of relying on it, is assumed or accepted by any member of Chambers or by Chambers as a whole., or the Copyright holder. No attempt has been made to provide an exhaustive review/account of the law in this area. *Copyright is owned by Barrister Search Limited.
[1] The Non-Domestic Rating (Unoccupied Property) (England) Regulations 2008 (SI 2008/386) contains a number of (other) exemptions. For those interested in reading about the other exemptions, available for rateably unoccupied hereditaments, through the combination of: (1) section 45(1)(d) of the LGFA 1988; and (2) regulations made under subsection 45(1)(d) - namely Non-Domestic Rating (Unoccupied Property) (England) Regulations 2008 (SI 2008/386), see an article entitled 'Business Rates - Unoccupied Property - 2008/386 Exemptions', available here.
[2a] For hereditaments in Wales, the same Local Government Finance Act 1988, section 45 applies, but the relevant regulations made under section 45(1)(d) are different:
(1) For Wales, the relevant regulations are the Non-Domestic Rating (Unoccupied Property) (Wales) Regulations 2008 (SI 2008/2499 (W. 217), whereas,
(2) For England, the relevant regulations are the Non-Domestic Rating (Unoccupied Property) (England) Regulations 2008 (SI 2008/386).
This article is just written in respect hereditaments subject to the Non-Domestic Rating (Unoccupied Property) (England) Regulations 2008 (SI 2008/386).
[2b] By reg.1, the Non-Domestic Rating (Unoccupied Property) (England) Regulations 2008 (SI 2008/386) came into force on 1.4.08.
[2c] The list of subregulations are labelled (a) to (m), but (j) is deleted. So there are 12 subregulations (not including (j), containing (at least) 12 different descriptions/circumstances (reg.4(a) to reg.4(m)). There is actually more than 12 different descriptions/circumstances exempt from business rates. This is because, while some of the 12 subregulations contain just one circumstance, others contain more than one and are grouped together under one subregulation because they relate to the same/similar area of law.
[2d] They are presumably grouped together because they both relate to Planning (Listed Buildings and Conservation Areas) Act 1990. The first, which is not relevant for present purposes, is an exemption for a hereditament 'which is the subject of a building preservation notice within the meaning of the Planning (Listed Buildings and Conservation Areas) Act 1990') - analysis of which is contained the article considering all the exemptions under Non-Domestic Rating (Unoccupied Property) (England) Regulations 2008 (SI 2008/386), entitled 'Business Rates - Unoccupied Property - 2008/386 Exemptions', available here.
[3] The previous applicable statutory instrument (i.e. the previous regulations from the Secretary of State), were Non-Domestic Rating (Unoccupied Property) Regulations 1989 (SI 1989/2261)(the '1989 Regulations'), also made under the current Local Government Finance Act 1988. For those interested in seeing how the exemption changed between the 1989 Regulations and the Unoccupied Property Regs 2008, the most material regulation in the 1989 Regulations to view, is reg.2 of the 1989 Regulations, which contains what later came to appear (to a very large extent, but not exactly) in the reg.3 and reg.4 to the Unoccupied Property Regs 2008.
In the last version to apply to England (but not Scotland and Wales), reg.2 of the 1989 Regulations (now obsolete) read:
'2.- Property liable for unoccupied property rates
(1) The class of non-domestic hereditaments prescribed for the purposes of section 45(1) of the Act consists of all relevant non-domestic hereditaments to which none of the conditions in paragraph (2) applies.
(2) The conditions are that–
...
(d) it is the subject of a building preservation notice as defined by section 58 of the Town and Country Planning Act 1971 or is included in a list compiled under section 54 of that Act;
...
(5)
(a) In paragraph (1), “relevant non-domestic hereditament” means any non-domestic hereditament consisting of, or of part of, any building, together with any land ordinarily used or intended for use for the purposes of the building or part, and
...'
[4] Schedule 1 to the General Rates Act 1967, paragraph 2 (now obsolete) read (at least when first enacted):
'No rates shall be payable under paragraph 1 of this Schedule in respect of a hereditament for, or for any part of the three months beginning with the day following the end of, any period during which-
(a) the owner is prohibited by law from occupying the hereditament or allowing it to be occupied;
(b) the hereditament is kept vacant by reason of action taken by or on behalf of the Crown or any local or public authority with a view to prohibiting the occupation of the hereditament or to acquiring it;
(c) the hereditament is the subject of a building preservation order under section 30 of the Town and Country Planning Act 1962, or is included in a list compiled or approved under section 32 of that Act, or is notified to the rating authority by the Minister as a building of architectural or historic interest;
(d) the hereditament is the subject of a preservation order or an interim preservation notice under the Ancient Monuments Acts 1913 to 1953, or is included in a list published by the Minister of Public Building and Works under those Acts;
(e) an agreement is in force with respect to the hereditament under section 56(1)(a) of this Act; or
(f) the hereditament is held for the purpose of being available for occupation by a minister of religion as a residence from which to perform the duties of his office.'
Under the General Rate Act 1967:
(1) there was only unoccupied rates due where the hereditament was in a rating area subject to a section 17 resolution of the General Rate Act 1967 (Paragraph 1(1), Schedule 1 to the General Rates Act 1967);
(2) the quantum of rates was 50% of what would be payable if it were occupied (Paragraph 1(2), Schedule 1 to the General Rates Act 1967).
But no rates were payable under paragraph 1(1), Schedule 1 to the General Rates Act 1967 where paragraph 2 of Schedule 1 to the General Rates Act 1967 applied.
[5] The Planning (Listed Buildings and Conservation Areas) Act 1990 ('1990 Act') introductory text states:
'An Act to consolidate certain enactments relating to special controls in respect of buildings and areas of special architectural or historic interest...'
(1) The 1990 Act, section 1 is entitled 'Listing of buildings of special architectural or historic interest'; and
(2) Town and Country Planning Act 1971 ('1971 Act'), section 54 (now obsolete), was entitled 'Lists of buildings of special architectural or historic interest. is entitled 'Listing of buildings of special architectural or historic interest'.
Comparing 2 iterations of a particular treating provision (objects and structures be treated as part of Listed building), Dyson J in Richardson Development Ltd v Birmingham City Council [1999] RVR 44 [1999] JPL 1001 said, at paragraph 6:
'The court was concerned with section 54(9) of the Town and Country Planning Act 1971, predecessor of, and not materially different from, section 1(5) of the 1990 Act.'
Jackson J in Morris v Wrexham County Borough Council [2001] EWHA Admin 697, at paragraph 29, said that Skinner J (upheld by the Court of Appeal) in Attorney General ex rel. Sutcliffe v. Calderdale Borough Council (1982) 46 P. & C.R. 399 had concluded a similar thing:
'Section 54(9) of the Town & Country Planning Act 1971 was in similar terms to what is now section 1(5) of the 1990 Act.'
For completeness, section 1 of the 1990 Act reads:
'(1) For the purposes of this Act and with a view to the guidance of local planning authorities in the performance of their functions under this Act and the principal Act in relation to buildings of special architectural or historic interest, the Secretary of State shall compile lists of such buildings, or approve, with or without modifications, such lists compiled by the Historic Buildings and Monuments Commission for England (in this Act referred to as “the Commission”) or by other persons or bodies of persons, and may amend any list so compiled or approved.
(2) The Secretary of State shall not approve any list compiled by the Commission if the list contains any building situated outside England.
(3) In considering whether to include a building in a list compiled or approved under this section, the Secretary of State may take into account not only the building itself but also-
(a) any respect in which its exterior contributes to the architectural or historic interest of any group of buildings of which it forms part; and
(b) the desirability of preserving, on the ground of its architectural or historic interest, any feature of the building consisting of a manmade object or structure fixed to the building or forming part of the land and comprised within the curtilage of the building.
(4) Before compiling, approving (with or without modifications) or amending any list under this section in relation to buildings which are situated in England the Secretary of State shall consult-
(a) with the Commission; and
(b) with such other persons or bodies of persons as appear to him appropriate as having special knowledge of, or interest in, buildings of architectural or historic interest.
(4A) Section 2A makes provision about consultation on amendments of any list under this section to include or exclude a building which is situated in Wales.
(5) In this Act “listed building” means a building which is for the time being included in a list compiled or approved by the Secretary of State under this section; and for the purposes of this Act-
(a) any object or structure fixed to the building;
(b) any object or structure within the curtilage of the building which, although not fixed to the building, forms part of the land and has done so since before 1st July 1948,
shall, subject to subsection (5A)(a), be treated as part of the building.
(5A) In a list compiled or approved under this section, an entry for a building situated in England may provide-
(a) that an object or structure mentioned in subsection (5)(a) or (b) is not to be treated as part of the building for the purposes of this Act;
(b) that any part or feature of the building is not of special architectural or historic interest.
(6) Schedule 1 shall have effect for the purpose of making provisions as to the treatment as listed buildings of certain buildings formerly subject to building preservation orders.'
For completeness, section 1 of the 1971 Act read (as originally enacted):
'(1) For the purposes of this Act and with a view to the guidance of local planning authorities in the performance of their functions under this Act in relation to buildings of special architectural or historic interest, the Secretary of State shall compile lists of such buildings, or approve, with or without modifications, such lists compiled by other persons or bodies of persons, and may amend any list so compiled or approved.
(2) In considering whether to include a building in a list compiled or approved under this section, the Secretary of State may take into account not only the building itself but also-
(a) any respect in which its exterior contributes to the architectural or historic interest of any group of buildings of which it forms part; and
(b) the desirability of preserving, on the ground of its architectural or historic interest, any feature of the building consisting of a man-made object or structure fixed to the building or forming part of the land and comprised within the curtilage of the building.
(3) Before compiling or approving, with or without modifications, any list under this section, or amending any list thereunder the Secretary of State shall consult with such persons or bodies of persons as appear to him appropriate as having special knowledge of, or interest in, buildings of architectural or historic interest.
(4) As soon as may be after any list has been compiled or approved under this section, or any amendments of such a list have been made, a copy of so much of the list as relates to any county borough, London borough or county district, or of so much of the amendments as relates thereto, as the case may be, certified by or on behalf of the Secretary of State to be a true copy thereof, shall be deposited with the clerk of the council of that borough or district, and also, where that council is not the local planning authority, with the clerk of the local planning authority.
(5) A copy of anything required by subsection (4) of this section to be deposited with the clerk of a London borough shall be deposited also with the clerk of the Greater London Council.
(6) Any copy deposited under subsection (4) of this section shall be registered in the register of local land charges in such manner as may be prescribed by rules made for the purposes of this section under section 15(6) of the Land Charges Act 1925 by the proper officer of the council of the county borough, London borough or county district.
(7) As soon as may be after the inclusion of any building in a list under this section, whether on the compilation or approval of the list or by the amendment thereof, or as soon as may be after any such list has been amended by the exclusion of any building therefrom, the council of the county borough, London borough or county district in whose area the building is situated, on being informed of the fact by the Secretary of State, shall serve a notice in the prescribed form on every owner and occupier of the building, stating that the building has been included in, or excluded from, the list, as the case may be.
(8) The Secretary of State shall keep available for public inspection, free of charge at reasonable hours and at a convenient place, copies of all lists and amendments of lists compiled, approved or made by him under this section; and every authority with whose clerk copies of any list or amendments are deposited under this section shall similarly keep available copies of so much of any such list or amendment as relates to buildings within their area.
(9) In this Act “listed building” means a building which is for the time being included in a list compiled or approved by the Secretary of State under this section; and, for the purposes of the provisions of this Act relating to listed buildings and building preservation notices, any object or structure fixed to a building, or forming part of the land and comprised within the curtilage of a building, shall be treated as part of the building.
(10) Every building which immediately before 1st January 1969 was subject to a building preservation order under Part III of the Act of 1962 but was not then included in a list compiled or approved under section 32 of that Act, shall be deemed to be a listed building; but the Secretary of State may at any time direct, in the case of any building, that this subsection shall no longer apply to it and the council of the county borough, London borough or county district in whose area the building is situated, on being notified of the Secretary of State's direction, shall give notice of it to the owner and occupier of the building.
(11) Before giving a direction under subsection (10) of this section in relation to a building, the Secretary of State shall consult with the local planning authority and with the owner and the occupier of the building.'
[6] Schedule 1 to the General Rates Act 1967, paragraph 2 (now obsolete) read (at least when first enacted):
'No rates shall be payable under paragraph 1 of this Schedule in respect of a hereditament for, or for any part of the three months beginning with the day following the end of, any period during which-
(a) the owner is prohibited by law from occupying the hereditament or allowing it to be occupied;
(b) the hereditament is kept vacant by reason of action taken by or on behalf of the Crown or any local or public authority with a view to prohibiting the occupation of the hereditament or to acquiring it;
(c) the hereditament is the subject of a building preservation order under section 30 of the Town and Country Planning Act 1962, or is included in a list compiled or approved under section 32 of that Act, or is notified to the rating authority by the Minister as a building of architectural or historic interest;
(d) the hereditament is the subject of a preservation order or an interim preservation notice under the Ancient Monuments Acts 1913 to 1953, or is included in a list published by the Minister of Public Building and Works under those Acts;
(e) an agreement is in force with respect to the hereditament under section 56(1)(a) of this Act; or
(f) the hereditament is held for the purpose of being available for occupation by a minister of religion as a residence from which to perform the duties of his office.'
[7] The reference to 'section 54' is a reference to section 54 of the Town and Country Planning Act 1971. Section 54 is the predecessor to section 1 of the Planning (Listed Buildings and Conservation Areas) Act 1990 - the section which currently governs the listing of buildings.
[8] In Providence Properties Ltd v Liverpool City Council [1980] Lexis Citation 733; [1980] RA 189, Lord Lane LCJ simply said this, at paragraph 22:
'I agree. Only one question posed for the opinion of this Court remains alive, and that is: "Whether when part only of a hereditament is included in a list compiled and approved under Section 54 of the Town and Country Planning Act, 1971 the hereditament is exempt from liability for rates under the provisions of paragraph 2(c) of the 1st Schedule to the General Rate Act, 1967 as amended by Part II of the 23rd Schedule to the Town and Country Planning Act, 1971?" to which the answer is "No".'
[9] In The Queen on the Application of Burnley Borough Council v Huron Properties Ltd [2016] EWHC 3803 (Admin), Kerr J said, at paragraph 16:
'As is well known, the Secretary of State in deciding whether to list a building has to consider whether the building is of "special architectural or historic interest." That is section 1(1) of the 1990 Act.'
[10] In Morris v Wrexham County Borough Council [2001] EWHA Admin 697 ('Morris'), Jackson J reviewed the authorities (set out below), and concluded that:
'...one of the principles of law which emerges is as follows: building A is within the curtilage of building B if (1) the buildings are sufficiently close and accessible to one another, and (2) in terms of function, building A is ancillary to building B.'
Jackson J's review of the authorities was made as part of his wider summary of the law (which will be set out below, for completeness).
Under the subheading 'Part 4: The Law' Jackson J in Morris said, from paragraphs 27 to 32 (note the law report erroneously has 2 x paragraph 31s):
'27. Section 1(5) of the 1990 Act provides as follows:
“In this Act ‘listed building’ means a building which is for the time being included in a list compiled or approved by the Secretary of State under this section; and for the purposes of this Act-
(a) any object or structure fixed to the building;
(b) any object or structure within the curtilage of the building which, although not fixed to the building, forms part of the land and has done so since before 1st July 1948
shall be treated as part of the building.”
29. Attorney General ex rel. Sutcliffe v. Calderdale Borough Council (1982) 46 P. & C.R. 399 concerned a mill which was linked by a bridge to a terrace of cottages. The mill was listed as a building of special architectural or historic interest, pursuant to section 54 of the Town & Country Planning Act 1971. In 1981 the Calderdale Borough Council proposed to demolish the terrace of cottages. Skinner J. held that the Council could not do so because the cottages fell within the curtilage of the mill. Section 54(9) of the Town & Country Planning Act 1971 was in similar terms to what is now section 1(5) of the 1990 Act. The effect of that provision was that the terrace formed part of the listed building. The Court of Appeal, with some hesitation, upheld Skinner J.'s decision. Stephenson L.J., who gave the leading judgment, said this at 406 to 507:
“There was, I think at the end of the argument before us agreement that three factors have to be taken into account in deciding whether a structure (or object) is within the curtilage of a listed building within the meaning of section 54(9) , whatever may be the strict conveyancing interpretation of the ancient and somewhat obscure word ‘curtilage’. They are (1) the physical ‘layout’ of the listed building and the structure, (2) their ownership, past and present, (3) their use or function, past and present. Where they are in common ownership and one is used in connection with the other, there is little difficulty in putting a structure near a building or even some distance from it into its curtilage. So when the terrace was built and the mill was worked by those who occupied the cottages, and the mill owner owned the *92 cottages, it would have been hard, if not impossible, to decide that the cottages were outside the curtilage of the mill.”
29. Stephenson L.J. went on to discuss the effect of changes in ownership and changes in use of the cottages in more recent time. At page 409 he concluded, with some hesitation, that these events had not taken the cottages out of the curtilage of the mill. Ackner L.J. and Sir Sebag Shaw agreed. Sir Sebag Shaw stated that he shared Stephenson L.J.'s doubts about the terrace of cottages remaining within the curtilage of the mill.
30. The House of Lords revisited these issues in Debenhams Plc v. Westminster City Council [1987] 1 A.C. 396. In that case two buildings were for a time linked by a subway and a bridge. One building was listed as being of special architectural or historic interest. The other was not. The House of Lords held, by a majority of four to one, that for listed building purposes the second building was neither fixed to nor within the curtilage of the first. Lord Keith, with whom Lord Templeman, Lord Griffiths and Lord Mackay agreed, discussed in some detail the facts and the decision in the Calderdale case. He then said this at page 403D to H:
“In my opinion to construe the word ‘structure’ here as embracing a complete building not subordinate to the building of which it is to be treated as forming part, would, in the light of the considerations I have mentioned, indeed produce an unreasonable result. Stephenson L.J. in the Calderdale case considered that objection to be offset by what he regarded as part of the purpose of the listing provisions, namely that of protecting the setting of an architecturally or historically important building. But if that was part of the purpose, it would have been to be expected that Parliament would not have stopped at other buildings fixed to or within the curtilage of such a building, but would have subjected to control also buildings immediately adjoining but not fixed to the listed building, or on the opposite side of the street. All these considerations and the general tenor of the second sentence of section 54(9) satisfy me that the word ‘structure’ is intended to convey a limitation to such structures as are ancillary to the listed building itself, for example the stable block of a mansion house, or the steading of a farmhouse, either fixed to the main building or within its curtilage. In my opinion the concept envisaged is that of principal and accessory. It does not follow that I would overrule the decision in the Calderdale case, though I would not accept the width of the reasoning of Stephenson L.J. There was in my opinion room for the view that the terrace of cottages was ancillary to the mill.”
Lord Mackay, with whom Lord Griffiths agreed, said this about the Calderdale case at page 411B to D.
In my opinion Attorney General ex rel. Sutcliffe v. Calderdale Borough Council, 46 P. & C.R. 399, is a very special case on its facts, and I believe that it was possible to treat the terrace and the mill, having regard to the history of the properties, as a single unit. At the time the listing was made the whole property was in one ownership and therefore when the mill was included, a notice to that effect was served on the only person who was interested as owner in the terrace. For the reasons which I have already given, I cannot regard, with respect, the reasoning by which the Court of Appeal in that case reached its conclusion as according with the true construction of section 54(9) of the Act of 1971.”
31. Watts v. the Secretary of State for the Environment [1991] J.P.L. 718 concerned a house known as Bix Manor, which was listed in 1985. A brick and flint wall abutted Bix Manor and ran alongside the drive. One of the outbuildings was converted to a dwelling, and the owner of that dwelling demolished a section of wall for the purpose of access. The Inspector held that the wall was a listed building because it was a structure attached to Bix Manor.
31. Sir Graham Eyre, q.c., sitting as a Deputy Judge of the Queen's Bench Division, allowed an appeal against that decision. At page 724 the Deputy Judge said this:
“At the date of the listing, the section of wall formed part of the curtilage of a property separate from the listed building in terms of ownership and physical occupation. That property was being put to a wholly independent use, unassociated with Bix Manor. Did the section of wall constitute a structure and solely to a building to which it had merely been associated historically and physically at some time prior to the listing, of which its owner and occupier had not been given notice under section 54(7) of the Act? He would have had little difficulty in finding that a wall was a structure ancillary to a listed building if at the time of listing it was fixed to the building and served the purpose of securing the building or its curtilage, and was therefore an accessory to the principal building. The use of words such as ‘ancillary’ and ‘accessory’ connoted an element of subordinate and subservient in both a functional and physical sense. At the time of the listing there was no functional connection, and that section of wall did not in any sense serve the listed building. It was clearly ancillary to another separate building and was not a structure ancillary to Bix Manor.”
32. In Secretary of State for the Environment, Transport and the Regions v. Skerritts of Nottingham [2000] J.P.L. 789 the Court of Appeal held that a stable block standing in the grounds of a hotel fell within the curtilage of the hotel and was accordingly listed. Robert Walker L.J., who gave the leading judgment, said this at page 795:
“No piece of land can ever be within the curtilage of more than one building, and if houses are built to a density of twenty or more to an acre, the curtilage of each will obviously be extremely restricted. But Norse L.J. recognised that in the case of what the now moribund Settled Land Act 1925 refers to as a ‘principal mansion house’—which is what Grimsdyke was built as—the stables and other outbuildings are likely to be included within its curtilage.
I also respectfully doubt whether the expression ‘curtilage’ can usefully be called a term of art. That phrase described an expression which is used by persons skilled in some particular profession, art or science, and which the practitioners clearly understand even if the uninitiated do not. This case demonstrates that not even lawyers can have a precise idea of what ‘curtilage’ means. It is, as this court said in Dyer, a question of fact and degree.
In my judgment the deputy judge was mistaken in treating Dyer as having such clear force as he thought it had. Not only was it concerned with dispropriatory legislation, but Calderdale and Debenhams were not cited, and the court's observations about smallness were not, on the facts of Dyer, necessary to the decision. In the context of what is now Part 1 of the Act, the curtilage of a substantial listed building is likely to extend to what are or have been, in terms of ownership and function, ancillary buildings. Of course, as Stephenson L.J. noted in Calderdale (at p. 407) physical ‘layout’ comes into the matter as well. In the nature of things the curtilage within which a mansion's satellite buildings are found is bound to be relatively limited. But the concept of smallness is in this context so completely relative as to be almost meaningless and unhelpful as a criterion.”
Jackson J then reached the conclusion quoted above.
[11] In Richardson Development Ltd v Birmingham City Council [1999] RVR 44; [1999] JPL 1001 ('Richardson'), Dyson J heard a case stated appeal against the decision of a Magistrates Court (a single Magistrates Court district judge (then called Stipendiary Magistrate) that a hereditament (St Chad's Court) was not exempt from business rates.
The ratepayer alleged that the hereditament was exempt from business rates, because it qualified for the rateably unoccupied listed building exemption. Eligibility for the exemption pivoted on whether or not the whole of St Chad's Court was 'listed': (a) if the whole was 'listed', then the exemption applied and no business rates were due; but (b) if the whole was not 'listed', then exemption did not apply and business rates were due (paragraph 1).
The central/core part of St Chad's Court (built over 200 years earlier) was 'listed'. But the hereditament also contained land upon which:
(1) 2 wings were built (a left wing and a right wing) in the 1930's ('1930's Wings'). There were knocked down in 1990s, when and
(2) 2 remodelled wings were built in the 1990's ('1990's Wings'). These was modern office blocks;
In the intervening period, between (1) and (2) above, the building was listed (in 1982) (paragraph 1).
Under the subheading 'Legislation', Dyson J set out the law (the exemption then was contained in the 1989 Regulations):
'There is a liability to pay rates in respect of unoccupied property if four conditions are met (section 45(1) of the Local Government Finance Act 1988). The only relevant condition is condition (d), which is that the hereditament must fall within a description prescribed by the Secretary of State by regulations. The Secretary of State has prescribed all non-domestic hereditaments for the purposes of (d) above (see regulation 2 of the Non-Domestic Rating (Unoccupied Property) Regulations 1989), save for those which satisfy conditions within regulation 2(2). One such condition is that the hereditament is included in a list compiled under what is now section 1 of the Planning (Listed Building and Conservation Areas) Act 1990. Section 1(5) of the 1990 Act provides:
"In this Act "listed building' means a building which is for the time being included in a list compiled or approved by the Secretary of State under this section; and for the purposes of this Act--
(a) any object or structure fixed to the building;
(b) any object or structure within the curtilage of the building which, although not fixed to the building, forms part of the land and has done so since before 1st July 1948 "shall be treated as part of the building."'
Dyson J then noted the Magistrates Court's decision (which he later concluded had '...applied the correct test and his findings are unchallengable' - paragraph 24), at paragraph 3, that:
(1) 'there must come a time when a new development goes beyond the point of being an "extension' (applying a common sense meaning to that word as defined in the Concise Oxford Dictionary as a "a part enlarging or added on to a main structure or building') and becomes a new building which incorporates the old building.';
(2) on the facts in Richardson:
(i) the wings development had gone beyond the point of amounting to a (mere) extension. There was not just one building, but now three, forming a complex;
(ii) the buildings were not co-dependent; they were designed for, advertised, and capable of separate occupation;
(iii) Lord Keith's judgment in Debenhams was of relevance:
'In my opinion to construe the word "structure" as embracing a complete building not subordinate to the building of which it is to be treated as forming part, would … indeed produce an unreasonable result.' (page 1068D-E)
'All these considerations, and the general tenor of the second sentence of section of 54(9) (of the Town and Country Planning Act 1971) satisfy me that the word "structure" is intended to convey a limitation to such structures as are ancillary to the listed building itself … In my opinion the concept envisaged is that of principal and accessory.' (at page 1068 F-G)
(iv) Crucially, 'The listed building in the present case is ancillary to the modern office blocks, rather than the other way round'; 'His central and fundamental finding was that the extensions were not ancillary to the listed building' (paragraph 23).
(v) '...the listed building now forms only a small percentage of the total ground floor area covered by the complex of buildings, it is an example of the modern development dominating the existing listed building. The new construction is the kind of modern office development which could appear anywhere, without incorporating a listed building....'
The Magistrates Court held in Richardson that '...since the recently constructed structures were not ancillary to the original listed building, they were not to be treated as part of a listed building under section 1(5)(a) of the 1990 Act.' (paragraph 4), and so the Magistrates Court '...concluded that St Chad's Court was not exempt from rating under regulation 2(2)(d) of the 1989 Regulations, and held that Richardson was liable to pay the rates demanded by the Council.' (paragraph 4)
As stated, Dyson J held that this was correct and unchallengable.
A separate legal contention Dyson J had to deal with, was whether '...section 1(5)(a) of the 1990 Act only applies to extensions to listed buildings which exist at the date of listing.' (paragraph 16). This contention was rejected by Dyson. At paragraph 16, Dyson J said:
'I cannot accept [counsel for the ratepayer's] submission that section 1(5)(a) of the 1990 Act only applies to extensions to listed buildings which exist at the date of listing. The words in subparagraph (a) "any object or structure fixed to the building" are unqualified as to date.'
Consequently:
(1) the question was not: whether the 1930 Wings were ancillary to the central/core part (i.e. the listed part) - as if the position in 1982 continued to exist; artificially ignore what had changed on the ground since 1982.
(2) the question was: whether the 1990's Wings (which were in situ, seemingly, during the relevant business rates years under dispute) were ancillary to the central/core part (i.e. the listed part).
A separate point to note, Dyson J said that 'It is possible for two buildings to be capable of separate occupation and yet one to be ancillary to the other.' (paragraph 22).
[12] In The Queen on the Application of Burnley Borough Council v Huron Properties Ltd [2016] EWHC 3803 (Admin), Kerr J said, at paragraph 18
'[Counsel for the appellant] submitted that [Shimizu (UK) Ltd v Westminster City Council [1997] 1 W.L.R. 168, [1997] 2 WLUK 113] is authority for the proposition that the Secretary of State can list part of a building and that proposition is not disputed.'
In Shimizu (UK) Ltd v Westminster City Council [1997] 1 WLR 168, [1997] 2 WLUK 113, the listed part of the building in question was its façade, chimney breasts and chimney stacks which were considered to be of special architectural or historical interest
[13] In City of Edinburgh v Secretary of State for Scotland [1997] 1 WLR 1447, [1997] 3 PLR 71 ('City of Edinburgh'), an issue arose as to whether a former riding school was a listed building. If it was, consent would be required to demolish it. In the House of Lords, it was held that a reporter in a planning appeal had been wrong in deciding that it was not. The only possible construction of the list entry was that it was a listed building.
In City of Edinburgh, Lord Hope pointed out that that list is not required to follow any particular format and that a list entry can comprise more than just the name of a building that can include some descriptive material. On the facts of the case it was necessary to look at some of that descriptive material to ascertain the scope of what had been listed and reach the conclusion that the building in question was a listed building.
Lord Clyde in City of Edinburgh, said, at page 81:
'Ambiguity only arises if the words in the brackets are read, as the reporter read them, as if they were intended to refer to buildings built during the specified years. But that is not what is stated and that is not the only possible construction. Even if there was a conflict between the two parts of the list it would be proper to find a 'construction which would make sense of the whole and that can be readily done…'
[14] Kerr J gives a illuminating summary of Barratt v Ashford Borough Council [2011] P & CR 21, CA, from paragraphs 25 to 28 of The Queen on the Application of Burnley Borough Council v Huron Properties Ltd [2016] EWHC 3803 (Admin):
'There the issue was whether a particular farm worker's cottage was or was not a listed building. If it was, works being carried out there were unauthorised for want of listed building consent.
26. The Court of Appeal upheld the decision of the recorder below that the building was indeed listed, albeit not by name in the listing entry. That gave as the name and address "High House Cottage, Corkscrew Lane, Stone-cum-Ebony" while the cottage where the works were being done was called "Hayes Cottage, Ebony Road, Stone-cum-Ebony". The Court of Appeal took into account an ordnance survey reference which when looked up on the relevant ordnance survey map included the property in issue, Hayes Cottage.
27. Mummery LJ said this at paragraph 36 and following:
"36. The next question is that of interpretation of the list and its contents in the light of the legislation. What is the proper approach to interpreting an entry in the list? …the ordinary and natural meaning of a document is usually determined by the court reading it as a whole in the setting of its relevant surrounding circumstances. In my judgment, the court must consider [the] whole of the entry in order to determine the meaning it would have for the reasonable person inspecting the list.
37. The judgments in the City of Edinburgh case took that approach. Lord Clyde, with whom all the other members of the Appellate committee, including Lord Hope, agreed, said that the question of what buildings are listed is one of interpretation and is a question of law for the court. It is not a question of fact. I agree with Mr Harrison that it is not a matter of the subjective intentions of those participating in, or responsible for, the compilation of the list, nor is it a matter that depends on the actual state of knowledge of the person potentially affected by an entry in the list. In short the Court's aim is for an objective contextual interpretation of the listing as a whole
…
39. In my judgment, the City of Edinburgh case decided that an entry in the list should be clear and precise, but that it is not sensible to be too strict in interpreting the list, such as by insisting on literal accuracy of details of dates or description. What really matters is whether, on a sensible contextual reading of the whole entry, its effect is clear and precise enough to identify the listed building.
40. In my judgment, sensible allowances can and should be made, consistently with the terms of the legislation and with established canons of construction, for the fact that in the real world more than one name may be commonly used to describe a building, a road or a place. Road names in rural areas sometimes change without precise or clear indications to the person trying to find the way along them. Names of buildings and places can undergo change over time. …"
28. Mummery LJ went on to discuss, as part of the context, the relevant local history in the case before the court and noted at paragraph 44 that the legislative regime requires compilation of an official list of buildings, not an official list of names.'