The UK Supreme Court has today handed down judgment in Westminster CC v UKI (Kingsway) Ltd, which concerned the circumstances in which a completion notice can be validly served by the billing authority on a ratepayer for the purposes of triggering an assessment to business rates.

The case concerned UKI’s premises on Kingsway, London, which were under construction in 2012. Westminster Council, as billing authority, wished to serve a completion notice to bring the building into assessment for business rates purposes, on the basis that, whilst it was not yet completed, it could reasonably be expected to be completed within three months. Where such a notice is validly served, it deems the building to be complete for rates purposes. Rather than using one of the methods of service provided for in statute, the council instead chose to leave the notice with the receptionist at the building. The receptionist was employed by the site manager, which was not authorised to accept service. The management company did however scan the notice, and forward it to its intended recipient electronically. The issue of the Court was whether that sequence of events amounted to valid service.

At first instance, the President of the VTE held that the notice was not validly served. The Deputy President of the Upper Tribunal reversed that decision. The Court of Appeal unanimously agreed with the VTE.

In a third judicial reversal, the Supreme Court has held that the notice was validly served. Lord Carnwath JSC (with whom the other members of the Court agreed), stressed the “good sense” of the VTE President’s observation that billing authorities are well-advised to rely on the statutory methods.

As to the validity of a method of service, the “real issue”, Lord Carnwath held, was whether there was a sufficient causal connection between the authority’s actions and the recipient’s receipt of the notice, so that the notice could properly be said to have been served by the authority on the recipient (para 36). On the facts, the passing of the notice by the receptionist to its intended recipient was the “natural consequence” of the council’s actions in leaving it with her. That amounted to causation under ordinary principles (even though the council had no control over the receptionist’s actions in a contractual or employment sense).

The Court recognised the importance of certainty as to the completion date for a new building. There is, however, a degree of uncertainty inherent in the legislation: Parliament has not exhaustively defined the methods of service of completion notices. Where the certainty of the date is critical, it is open to billing authorities to use a specified method, where the risk of invalidity is eliminated or minimised (para 43).

Finally, the Court held that the service of the notice by electronic means was valid. The general law of service enabled such methods to be used, and the statutory scheme for electronic communications (which expressly authorises electronic service for certain types of rating notices, but not for completion notices) was not sufficiently inconsistent to have overruled the general law.

Dan Kolinsky QC and Luke Wilcox appeared for UKI.

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