[2025] UKUT 00324 (LC)

The appellant asked the FTT for permission to appeal on two separate grounds, challenging first its assessment of the value of the existing lease and, secondly, its determination of the FHVP value. It asserted that the FTT’s determination of FHVP was too low and that its determination of existing lease value was too high.

In draft grounds of appeal submitted to the FTT, which were settled by Ms Muir, the appellant proposed a challenge to the FTT’s acceptance of the February 2024 sale of the Property at a price of £1,170,000 as a reliable basis for ascertaining the value of the existing lease. It suggested that “Mr Sharp disputed […] that this was an open market sale or that the price represented the market value.” It asserted that Mr Cooper had not produced any estate agent’s particulars and that “[i]t has now transpired that estate agent’s particulars were available and that the asking price was £1.1 million”.

In its refusal of permission to appeal on both grounds the FTT expressed some puzzlement about these assertions, saying this:

“We are unsure what the complaint is. [Mr Sharp] used the relativity shown at tab 8 of his report. He applied 6%. We applied 5.85% taken from the very case [Mr Sharp] referred us to. The difference between [Mr Sharp’s] value for this element and our assessment is de minimis. It should be remembered that the sale price in February 2024 was agreed at £1,700,000 [sic] as set out in the statement of agreed issues. The introduction of later evidence as to the estimated sale price of £1.1M is inappropriate and in any event irrelevant.”

There is a typographical error in this passage as the sale price in February 2024 was agreed to have been £1,170,000. The FTT presumably also meant to refer to the “adjustment for Act rights” shown at tab 8 of Mr Sharp’s report, not relativity. But the FTT’s point is clear. It refused permission to appeal on the basis that its own figure for the value of the existing lease was based on the same evidence as had been used by Mr Sharp, the appellant’s own expert, and that the divergence between his figure and its figure was trivial. It considered it was too late to introduce evidence casting doubt on the bona fides of that transaction (remembering that it is in the interest of the landlord for the existing lease to have a lower rather than a higher value).

In his written evidence to the FTT Mr Sharp had relied on the sale price of £1,170,000 (which was an agreed fact) but he commented that Mr Cooper “advised that the property was marketed although I have not been able to find estate agent’s particulars.” He noted that, when compared to his own assessment of value of the freehold interest in the Property “the relativity produced is 69.46% which is reasonably close to the average 74.37% produced by the Gerald Eve and Savills 2016 graphs”. He added “[t]hat relativity so produced is less than that indicated by graphs is not unusual on this estate”. We have not been provided with any note of the oral evidence given to the FTT but from the terms in which it refused permission to appeal we assume that Mr Sharp did not retreat from using the February 2024 sale figure as the basis of an (almost) agreed existing lease value.

When it applied to this Tribunal for permission to appeal, the appellant did not challenge the FTT’s assessment of the existing lease value. The first ground for which the FTT’s permission had been sought was omitted and the only challenge was to the assessment of FHVP value. As a result, it is not open to the appellant to challenge that aspect of the FTT’s decision.