Property Lawyer Comments On High Profile Case

The Supreme Court has today given its judgment in a property dispute which will dictate future business rates levels for companies occupying multiple but unconnected floors in a building.

The case relates to offices occupied by Mazars on the second and sixth floors in the eight-storey Tower Bridge House in London with a rateable value of c.£1m.

In both the Valuation Tribunal and the Upper Tribunal accountancy firm Mazars successfully claimed that together the two floors constituted a single hereditament for the purposes of setting business rates.

However in today’s unanimous judgment the Supreme Court reversed those decisions and agreed with the Valuation Officer that the two floors should be treated as two separate hereditaments and therefore rated separately. The effect of which, in certain circumstances, will prevent rate payers seeking a discount on the amount of rates paid.

Handing down its ruling today, the Supreme Court declared three broad principles to determine the question of whether distinct spaces under common ownership could form a single hereditament for the purpose of business rates. The broad principles set out by the court look at geographic, functionality and enjoyment tests with the President of the Supreme court commenting that “where premises consist of two self-contained pieces of property, it would, in my view, require relatively exceptional facts before they could be treated as a single hereditament.”

Get in touch with our Property Litigation solicitors if you want expert and tactical advice. Visit our Commercial Property Litigation page if you have a similar dispute to Mazars.