[2025] UKUT 256 (LC)

Mr Genchev joined the VO in June 2019 and since that time has been dealing with rating work throughout the southeast of England and outer London.

His report covered the valuation of the property and included details of the comparables that he had relied upon. As we have concluded that the scope of the challenge made by Mr Schroeder does not extend to the valuation it is germane for us to consider only the sections in his report which are relevant to the question of exemption.

The first of these is the trading pattern. Mr Genchev referred to two properties which were said to operate in the same seasonal way as the Property. Both were included in the rating list. The first is Wylds Farm, at Warren Road, Liss, Hants, GU33 7DF. It is assessed on the 2023 Rating List at a rateable value of £10,000 and extends to a total area of 35 acres of which 16 acres is the Christmas tree growing area. The farm cultivates 22,000 trees at any one time. The farm has a bar/café area on site that serves costumers visiting the farm and purchasing Christmas trees. It trades from late November to the middle of December which Mr Genchev thought was a very similar trading period to the subject property. The sales area amounts to 103 m² which has beenvalued at £96.66 per m². Wylds Farm also hosts a Shakespeare festival once a year and wedding events (up to 10 events per year). These additional uses are not reflected in the assessment which is now subject to review.

Mr Genchev’s second comparable is Cotley Farm, Whimple, Exeter, EX5 2QR which was assessed at rateable value £5,100 in the 2017 rating list. Cotley Farm is a dairy farm with a total area of 700 acres of which 10 acres are used for growing Christmas trees. It has a Christmas shop and tearoom area that serves customers visiting the farm and purchasing Christmas trees. It trades for four weeks each year from the last weekend of November until midday on Christmas Eve. The sales area is approximately 97.37 m² which was valued at £45 per m², and ancillary storage areas were valued at £22.50 per m².

Mr Genchev also referred to Southend-on-Sea Corporation v White [1900] 65 JP 7 where the tenant of a seaside shop closed it during the out of season winter months and removed the stock, leaving only a few shelves and other chattels which would be needed on re-opening for the new season. The tenant was held to be in rateable occupation for the whole year (including the closed winter months). They had been in occupation and had every intention of returning; the shop being closed over the winter months was part of the normal operation of the business carried on there.

Mr Schroeder questioned Mr Genchev’s failure to distinguish between an activity carried on for a small part of the year and an activity carried on “365 days” each year. He put to Mr Genchev that the Property was a unique one, or as he described it “sui generis”, stating that items had to be left there throughout the year as they could not conveniently be used for any other purpose, and there was no other use to which the parts of the Property where they were stored could be put. There would be no point, for example, in removing the café. Mr Schroeder pointed out that both of Mr Genchev’s comparables were assessed at figures below the threshold for inclusion in the Small Business Rate Relief scheme and therefore attracted no liability.

Mr Genchev’s investigations into the planning permissions at the Property led him to the conclusion that commercial rather than agricultural use had been accepted by Maidstone Borough Council. He said in his report that ‘the site has approval for Christmas Tree sales and the planning evidence indicates that the planning authority are fully aware of the activities on site and have not taken any enforcement action to prevent the sales of other Christmas goods’.

Mr Genchev also commented on Mr Schroeder’s assertion that the Property was in such poor repair that no prospective tenant would bid for it. He considered that Mr Schroeder had not provided any evidence of disrepair and explained that the statutory definition of rateable value assumed that the hereditament was in repair but excluding from this assumption any repairs which a reasonable landlord would consider uneconomic. He noted that the majority of buildings on site were constructed after 2002 and he did not consider them to be in poor repair or uneconomic to repair. Similarly, there was no evidence of water ingress on the day of inspection, and no areas which were not accessible to customers due to poor condition.