Decision of the Lands Valuation Appeal Court regarding an appeal by the assessor against a decision of the Dundee Valuation Appeal Committee. (After noting that strict adherence with the legislation would create a situation that was inequitable and unfair) the Committee had allowed 49 appeals by Land Securities and others against the valuation of shops in the Overgate Centre in Dundee on the basis that a fall in the retail rental values caused by the recession (agreed to have happened on 1 April 2009) amounted to a material change in circumstances after the valuation date. The valuation date was 1 April 2008 and took effect two years later on 1 April 2010.

The issue for the court was whether a material change of circumstances which had occurred during the 2005 roll at a date (agreed to be 1 April 2009) after the valuation date for the 2010 roll should be reflected in the 2010 roll. The ratepayers did not argue that the values entered on the 2010 roll should be reduced due to a supervening material change of circumstances. Instead their contention was that the values should not have been entered into the roll in the first place.

 This argument did not find favour with the court. The Lord President said:

 “In my opinion, this argument is fallacious. It overlooks the basis on which a revaluation is carried out. It confuses the date at which a value has to be struck with the date on which it will come into force. The fundamental principle on which a revaluation is carried out is that all of the lands and heritages entered in the new roll are valued to a common base. With one exception, there is no warrant in the legislation for the assessor’s adjusting tone date[1] valuations in respect of changes in value that occur between the tone date and the revaluation date. Inevitably, there will be increases and decreases in the values of various groups or classes of lands and heritages during that period; but for there to be consistency in the roll it is essential that all lands and heritages in the new roll must be valued as at one fixed date. The exception is the power given to the assessor in section 1(6)(c) of the 1975 Act (supra) to take account of a material change of circumstances in the period after the roll has been made up and before it has come into force.”

Appeals can be made under s 3(2) and 3(4) of the Local Government (Scotland) Act 1975. The right of appeal under section 3(4) extends to a material change of circumstances occurring between the date of delivery of the roll and the date on which the roll comes into force. It does not apply to a material change of circumstances occurring before the entry was made.

Section 3(2) also provides a general right of appeal against a new entry. It would have been open to the ratepayers to appeal under section 3(2) (within the 6 month time limit) in respect of a material change of circumstances occurring after the date of delivery of the roll. That did not assist the ratepayers in this case. The change of circumstances on which they relied had affected values by 1 April 2009 and there was no suggestion that the 2010 roll had been made up by that date.

The court allowed the assessor’s appeal and recalled the decision of the Committee.

The full judgement is available from Scottish Courts here.

A similar decision was reached in respect of properties at the Mercat Shopping Centre in Kirkcaldy in The Assessor for Fife v. Mercat Kirkcaldy Limited and others. The full text of that judgement is available here.

All of our property and conveyancing case summaries are contained in the LKS Property and Conveyancing Casebook here.