LANDS VALUATION APPEAL COURT, COURT OF SESSION
Lord Justice Clerk Lord Clarke Lord Hodge	[2008] CSIH 3 XA77/07   OPINION OF THE LORD JUSTICE CLERK   In the Appeal by   BELHAVEN BREWERY COMPANY LIMITED Appellant;   against   THE ASSESSOR FOR HIGHLAND AND WESTERN ISLES Respondent: _______

 

Act: Kinroy QC; Simpson & Marwick WS

Alt: Doherty QC; Drummond Miller WS

 

15 January 2008

 

Introduction

[1] This appeal relates to a public house called the Bar Pivo at 38-40 Academy Street, Inverness. The subjects were previously a bank. The appellant opened them as a public house on 14 March 2003. The assessor entered them in the Roll with effect from that date at a net annual value (NAV) of £32,000. That value applied for the period 14 March 2003 to 31 March 2005. The appellant appealed against the assessment on the ground of a material change of circumstances on the basis of an expected downturn in trade; but withdrew the appeal when the downturn did not occur.

[2] The 2005 revaluation took effect on 1 April 2005. The tone date for the revaluation was 1 April 2003. In the 2005 revaluation public houses were valued in accordance with the scheme of the Scottish Assessors' Association for licensed premises (the 2005 scheme). This scheme introduced the concept of the fair maintainable turnover in the calculation of NAV (cf Suburban Taverns (Glasgow) Ltd v Ass for Glasgow, 15 January 2008). Since the premises opened only about two weeks before the tone date, the assessor based his valuation on turnover figures for the 46 weeks period from 7 March 2003 to 24 January 2004. It brought out an NAV of £41,000. He carried out a check calculation based on the average of the turnovers in the years to 31 March 2004 and 31 March 2005. That brought out an NAV of £40,000. He entered the subjects in the Roll at an NAV of £41,000. The appellant appealed against the entry.

[3] Before the Committee, the appellant's representative, Mr Peter Henry FRICS, submitted that the turnover figures on which the assessor based his valuation were not sustainable (cf Suburban Taverns (Glasgow) Ltd v Ass for Glasgow, supra). He based his valuation on the turnover figures for the year to 31 March 2006, that is to say the first year of turnover after the revaluation came into force and the third year after the tone date. The application of the 2005 scheme to these figures brought out an NAV of £35,200.

[4] The Committee rejected Mr Henry's use of the 2005-2006 figures; but, having regard to the assessor's check valuation and an alternative calculation based on the indexing of the figures for the first year's trading, it allowed the appeal to the extent of substituting an NAV of £40,000.

[5] Mr Henry required the Committee to state a case. He tabled six grounds of appeal. In May 2007 the solicitors for the appellant lodged the stated case. They neglected to serve copies of the stated case on the assessor (cf Act of Sederunt (Valuation Appeal Rules Amendment) 1982 (SI No 1506), rule 10). When the assessor heard by chance that the appeal had been lodged, the solicitors for the appellant told him by e-mail dated 26 October 2007 that, after discussions with Mr Henry, it had been decided that the appeal would proceed. On 11 November 2007 Mr Henry confirmed this to the assessor.

 

The abandonment of the appeal

[6] At the outset of the hearing on 12 December 2007, counsel for the appellant moved for leave to abandon the appeal. In doing so he offered an undertaking on behalf of Mr Henry to which I shall refer. His motion was not opposed by counsel for the assessor.

[7] Counsel told us that the grounds of appeal were drafted by Mr Henry. No advice on the grounds of appeal had been sought until shortly before the hearing. On 7 December 2007 counsel advised that the appeal should be abandoned. On 10 December he amplified that advice. Mr Henry then accepted that the appeal was unstatable.

[8] Counsel for the appellant apologised to the court and to the assessor on behalf of Mr Henry. He said that Mr Henry accepted that he had made a serious mistake.

 

The background

[9] A person who is not legally qualified may be allowed to conduct an appeal before a local valuation appeal committee (Valuation Committee (Procedure in Appeals under the Valuation Acts) (Scotland) Regs 1995 (SI No 572), reg 13(1)). This is a useful provision. It can be helpful to a committee if an appeal is presented by a competent rating surveyor; but problems can arise where an appeal is conducted by a representative who lacks a proper understanding of valuation law and practice and who does not take legal advice. In recent years Mr Henry has persistently abused the privilege of conducting appeals before committees. We have had occasion to comment on his conduct towards assessors, committees, and secretaries to committees, and on his perverse challenges to revaluation schemes that have been generally accepted by responsible rating surveyors (cf Belhaven Brewery Group plc v Glasgow City Ass, 2003 SC 395, at para [16]; Sinclair v Lothian Ass, [2003] RA 202; Noble v Ass for Grampian Valuation Joint Board, 2004 SC 383; North British Trust Hotels Ltd v Ass for Highland and Western Isles, 2005 SLT 419).

[10] Mr Henry has also caused problems for this court. He has taken numerous appeals against decisions of committees on mostly irrelevant grounds. At this sitting we have heard two appeals in which counsel was prepared to argue only two of nine grounds tabled by Mr Henry, neither of which had any merit (Suburban Taverns (Glasgow) Ltd v Ass for Glasgow, supra; Belhaven Brewery Co Ltd v Ass for Glasgow, 15 January 2008).

[11] In Noble v Ass for Grampian Valuation Joint Board (supra) we found the appellants liable to the assessor in the expenses of a number of hopeless appeals that Mr Henry ought not to have brought. We did so on an undertaking by Mr Henry that he would meet those expenses himself.

[12] In North British Trust Hotels Ltd v Ass for Highland and Western Isles (supra) several hopeless appeals were abandoned on the morning of the hearing. Mr Henry had taken the appeals without legal advice and had sought counsel's advice only a few days before the hearing. We awarded expenses to the assessor against the appellants, but one of our number gave notice of the possibility that in a similar situation the court might award expenses against the appellant's representative personally (at para [13]).

[13] We hoped that our decision in North British Trust Hotels Ltd v Ass for Highland and Western Isles (supra) would ensure that there would be no repetition of such conduct. Now it has happened again.

 

The undertaking offered by Mr Henry

[14] Counsel for the appellant gave an undertaking that "Mr Henry would never again take an appeal to this court without taking legal advice at the earliest opportunity." He accepted that Mr Henry should be found personally liable to the assessor in expenses on a solicitor and client basis.

 

Conclusions

[15] Mr Henry's conduct in this and other cases has constituted an abuse of process. His undertaking will spare this court the waste of administrative and judicial time and resources that occurs in situations like this. It is an undertaking in foro. If Mr Henry were to be in breach of it, he would be in contempt of court (Graham v Robert Younger Ltd, 1955 SC 28). I would add that in any case in which a rating surveyor may instruct solicitors to lodge an appeal to this court, those solicitors are not relieved of their own duty to consider whether the appeal may properly be brought.

[16] But Mr Henry's undertaking will not affect the waste of the time of assessors, committee members and clerks that is caused by the hopeless appeals that he takes to local committees and the pointless cases that he requires them to state. It may be that he hopes that in such cases assessors will concede reductions in NAV for the sake of peace. If so, that is a futile strategy. When a hopeless appeal is taken to a committee, the assessor does not have the option that would be available to a private litigant of compromising to save time, trouble and expense. If the assessor is satisfied that his valuation is sound, it is his duty to defend it. If he were not to do so, or were to compromise the case for the sake of peace, he would be in breach of his duty of fairness to other ratepayers (Lands Valuation (Scotland) Act 1854 (the 1854 Act), s 13).

[17] Appeals to local committees involve assessors and committees in considerable trouble and expense. The process of drafting a stated case and dealing with the tiresome revisals that Mr Henry usually proposes adds unreasonably to the burdens of the clerk. I remind committees and their clerks that regulation 13(2) of the 1995 Regulations (supra) provides that if in any particular case the committee is satisfied that there are good and sufficient reasons for doing so, it may refuse to permit a person to assist or represent a party at the hearing.

[18] Since the abolition of domestic rating, most appeals to committees are taken by commercial organisations on the advice of professional valuers. There is no sanction if such appeals are taken irresponsibly. Under section 13 of the 1854 Act, a local committee has the power to award expenses where a complaint by a ratepayer has been made without reasonable or probable cause. It is unfortunate, in my view, that committees do not have the same power in relation to appeals.

 

Disposal

[19] I propose to your Lordships that we should grant leave to the appellant to abandon the appeal and find Mr Henry personally liable to the assessor in the expenses of the appeal on an agent and client basis.

LANDS VALUATION APPEAL COURT, COURT OF SESSION
Lord Justice Clerk Lord Clarke Lord Hodge	[2008] CSIH 3 XA77/07   OPINION OF LORD CLARKE   in the   APPEAL   by   BELHAVEN BREWERY COMPANY LIMITED Appellant;   against   THE ASSESSOR FOR HIGHLAND AND WESTERN ISLES Respondent: _______

 

Act: Kinroy QC; Simpson & Marwick WS

Alt: Doherty QC; Drummond Miller WS

 

15 January 2008

 

[20] I agree with your Lordship in the chair as to how this appeal should be disposed of and there is nothing I wish to add.

LANDS VALUATION APPEAL COURT, COURT OF SESSION
Lord Justice Clerk Lord Clarke Lord Hodge	[2008] CSIH 3 XA77/07   OPINION OF LORD HODGE   in the   APPEAL   by   BELHAVEN BREWERY COMPANY LIMITED Appellant;   against   THE ASSESSOR FOR HIGHLAND AND WESTERN ISLES Respondent: _______

 

Act: Kinroy QC; Simpson & Marwick WS

Alt: Doherty QC; Drummond Miller WS

 

15 January 2008

 

[21] I have read and agree with the opinion of your Lordship in the chair. I agree that the appeal should be refused. Having regard to what this Court said in North British Trust Hotels Ltd v Ass for Highland and Western Isles 2005 SLT 419 it is very unfortunate that Mr Henry has until now insisted in this unstateable appeal. The undertaking which counsel has proffered and the award of expenses against Mr Henry personally are the proper means of disposing of the appeal and addressing the problem which it has exposed.