Lands Tribunal for Scotland


Valuation for rating – Refusal of Committee of request to refer to Tribunal – Appeal – Shop – Rent expressed as higher of ‘80% of open market value’ and set percentage of turnover – Issue as to analysis of rent – Whether evidence to be given by expert opinion complex or highly technical – Whether law applicable uncertain – whether case raised fundamental or general issue likely to be used as precedent – Lands Tribunal Act 1949, Section 1(3BA) – Valuation Appeal Committee (Procedure in Appeals under the Valuation Acts)(Scotland) Regulations 1995, Regulation 5(1)(b),(c),(d)

Woolworths plc v Assessor for Renfrewshire
7 February 2007

The subjects were one of 4 comparable retail units of similar size at a shopping centre. Unlike the other three, the rent of the subjects was expressed as the higher of ‘80% of open market value’ and a set percentage of turnover. The appellants were arguing that tenants of this landlord regarded the 80% figure as the rack rent, any turnover top-up being ‘landlord’s profit rent’. It was said that the evidence of rent review valuation experts, at a level above that of a normal local committee would be required. It was an uncertain legal point whether in this instance ‘base’ rents were rack rents. An English arbitration award was to be relied on. If the argument were successful, it would set a precedent for other shops in other centres. The Assessor argued that the matters raised related to established general principles: the expert evidence would not be complex or highly technical; there was no uncertainty in the law applicable, the Tribunal having dealt with turnover rents in Morrison EF (GP) Limited v Assessor for Central; and there was no distinct issue with an appreciable bearing on valuation practice.

Held, refusing the appeal, this appeal was likely to turn on the body of rental evidence available rather than interpretation of the appellants’ own rent review provision. The evidence would mainly consist of rental analysis of a type normal and familiar in the context of modern retail subjects. A reading of the English arbitration award confirmed that view. No particular question of law was raised. The result would no doubt be looked on with interest and have an effect in other cases, but that did not show a fundamental or general issue. The Tribunal was not persuaded either that this was an early dispute regarding the approach to turnover rents or that there was any novel issue.

Cases referred to:-

Morrison EF (GP) Limited v Assessor for Central, 13.2.2003, LTS/VA/2001/16
Lanarkshire Primary Care NHS Trust v Assessor for Lanarkshire, 26.6.2003, LTS/VA/2003/15
Next PLC and Others v Assessor for Highland & Western Isles 2005 SLT (Lands Tr) 7

See full decision:  LTS/VA/2006/02