Case No: C3/2014/1650
Neutral Citation Number: [2015] EWCA Civ 1306
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE UPPER TRIBUNAL (LANDS CHAMBER)
MR MARTIN ROGER QC 
RA/12/2013
Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 18 December 2015
Before :

LORD JUSTICE PATTEN
LADY JUSTICE KING
and
DAME JANET SMITH

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Between :

	BMC PROPERTIES & MANAGEMENT LIMITED	Applicant/
Appellant	
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	DAVID JACKSON (VALUATION OFFICER) 	Respondent	

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Ms Alison Foster QC and Ms Myriam Stacey (instructed by Collyer Bristow LLP) for the Appellant
Ms Hui Ling McCarthy (instructed by the Solicitor to HM Revenue and Customs) for the Respondent

Hearing date : 17 November 2015

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Judgment
Lord Justice Patten : 
1.	This is an appeal by BMC Properties and Management Limited (“BMC”), the owner of a property at 8 Collingham Road, London SW5 (“the Property”), against a decision of the Upper Tribunal (Lands Chamber) (Mr Martin Roger QC) released on 11 March 2014 ([2014] UKUT 0093 (LC)).  The Upper Tribunal dismissed the appeal by BMC against an earlier decision of the Valuation Tribunal for England (“VTE”) given on 4 March 2013 that an alteration to the 2005 rating list to include the Property as a new hereditament with a rateable value of £62,500 took effect from 1 April 2005 which was the day on which the 2005 list came into force.  BMC contended and maintain on this appeal that the effective date cannot be earlier than 22 March 2011 when the alteration to the list was made so that the valuation officer could not include the alteration in the 2005 list.  But in this Court they have also relied on an alternative and more fundamental argument that the valuation officer has no power under the Local Government Finance Act 1988 (“LGFA 1988”) or the regulations made thereunder to make an alteration during the currency of a rating list.  The inclusion of the Property as a new hereditament must await the preparation of a new list which is currently scheduled for 2017.
2.	The appeal, as one would expect, turns on the construction of LGFA 1988 and the version of the Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009 SI 2009 No. 2268 (“the 2009 Regulations”) in force at the time when the alteration was made.  The issue of construction largely centres on regulation 14.  But, before I come to that, and in order to set the matter in context, I need to outline some of the factual background. 
3.	The Property was acquired by BMC in February 2007.  It consists of a large five storey house in West London which has been divided into 19 self-contained units and used for short-term holiday letting.  It is common ground that this use of the Property has continued since at least 16 December 1989.  A certificate of lawful use for that purpose was issued by the local planning authority, the London Borough of Kensington and Chelsea, on 16 December 1999.  The certificate states that the use commenced more than 10 years before the date of the certificate, although the precise date on which it commenced is not known and cannot reasonably be ascertained.
4.	The Property was not included in the 1990 rating list or in any subsequent list until it was entered in the 2005 list by amendment on 22 March 2011.  BMC accepts that although the Property has always been included as a domestic dwelling in the valuation list maintained under the Local Government Finance Act 1992 for the purposes of council tax, its commercial use since at least 1989 means that it should have been included in the 1990 rating list and in every rating list thereafter.  The dispute between the parties is limited to the method which should have been used to achieve this and the date from which its inclusion in the rating list ought to take effect.
5.	The valuation officer proceeded to include the Property in the 2005 rating list by issuing a notice of addition on 22 March 2011 in order to effect an alteration in the 2005 list with effect from 15 March 2008.  The explanation for the 2008 date was that this was when the valuation officer then understood the change in the use of the Property had occurred.  BMC then submitted a proposal to delete the entry of the Property from the 2005 list.  It contended that the effective date for any inclusion of the Property in a rating list was 22 March 2011 (the date of the notice of addition) which fell outside the duration of the 2005 list.
6.	By the time of the hearing in the VTE the valuation officer had discovered that the commercial use of the Property pre-dated 2005 and therefore contended that the effective date should be 1 April 2005 when the 2005 list came into effect.
7.	The current rating statute is LGFA 1988.  Section 41 imposes on the valuation officer a statutory duty to compile and maintain rating lists.  Historically new lists were compiled every five years but, by statutory amendment, the next list must be compiled on 1 April 2017:
“41.— Local rating lists.
(1) In accordance with this Part the valuation officer for a [billing authority] shall compile, and then maintain, lists for the authority (to be called its local non-domestic rating lists). 
(2) A list must be compiled on 1 April 1990 and on 1 April in every fifth year afterwards, subject to subsection (2A). 
(2A) In the case of a billing authority in England—
(a)	subsection (2) does not require a list to be compiled on 1 April 2015 and on 1 April in every fifth year afterwards, and
(b) 	a list must instead be compiled on 1 April 2017 and on 1 April in every fifth year afterwards.
(3) A list shall come into force on the day on which it is compiled and shall remain in force until the next one is compiled.
(4) Before a list is compiled the valuation officer must take such steps as are reasonably practicable to ensure that it is accurately compiled on 1 April concerned.
…..
(7) A list must be maintained for so long as is necessary for the purposes of this Part, so that the expiry of the period for which it is in force does not detract from the duty to maintain it.”
8.	The duty to maintain the list is confirmed by s.42(1) which states that the list must contain each qualifying hereditament within the rating authority’s area “for each day in each chargeable financial year”.  In order to accomplish this task s.55 LGFA 1988 also confers a power on the Secretary of State to make regulations about the alteration of the rating lists by valuation officers:
“(2) The Secretary of State may make regulations about the alteration by valuation officers of lists which have been compiled under this Part, whether or not they are still in force; and subsections (3) to (7) below shall apply for the purposes of this subsection.
(3) The regulations may include provision that where a valuation officer intends to alter a list with a view to its being accurately maintained, he shall not alter it unless prescribed conditions (as to notice or otherwise) are fulfilled.
(4) The regulations may include provision—
(a) 	as to who (other than a valuation officer) may make a proposal for the alteration of a list with a view to its being accurately maintained,
(b) 	as to the manner and circumstances in which a proposal may be made,
(c) 	as to the period within which a proposal must be made,
(d) 	as to the procedure for and subsequent to the making of a proposal, and
(dd)	as to the circumstances within which and the conditions upon which a proposal may be withdrawn
(e) 	requiring the valuation officer to inform other prescribed persons of the proposal in a prescribed manner.
(5) The regulations may include provision that, where there is a disagreement between a valuation officer and another person making a proposal for the alteration of a list—
(a) 	about the validity of the proposal; or
(b) 	about the accuracy of the list
an appeal may be made to a valuation tribunal established under Schedule 11 below.
(6) The regulations may include—
(a) 	provision as to the period for which or day from which an alteration of a list is to have effect (including provision that it is to have retrospective effect);
(b) 	provision requiring the list to be altered so as to indicate the effect (retrospective or otherwise) of the alteration;
(c) 	provision requiring the valuation officer to inform prescribed persons of an alteration within a prescribed period;
(d) 	provision requiring the valuation officer to keep for a prescribed period a record of the state of the list before the alteration was made.
(7) The regulations may include provision as to financial adjustments to be made as a result of alterations, including—
(a) 	provision requiring payments or repayments to be made, with or without interest, and
(c)	provision as to the recovery (by deduction or otherwise) of sums due.”
9.	It is important to note that, as part of the rule making power under s.55, Parliament (in s.55(6)) has expressly conferred on the Secretary of State power to make authorised alterations to the list retrospective in their effect.  This power has been exercised to produce regulations in 1990, 1993, 2005 and 2009.  The 2009 Regulations (in the form they took at the date of the alteration in this case) provided as follows:
“4.—(1) The grounds for making a proposal are—
(a) 	the rateable value shown in the list for a hereditament was inaccurate on the day the list was compiled;
(b) 	the rateable value shown in the list for a hereditament is inaccurate by reason of a material change of circumstances which occurred on or after the day on which the list was compiled;
(c) 	the rateable value shown in the list for a hereditament is inaccurate by reason of an amendment to the classes of plant and machinery set out in the Schedule to the Valuation for Rating (Plant and Machinery) (England) Regulations 2000(b) which comes into force on or after the day on which the list was compiled;
(d) 	the rateable value shown in the list for a hereditament by reason of an alteration made by a VO is or has been inaccurate;
(e) 	the rateable value or any other information shown in the list for a hereditament is shown, by reason of a decision in relation to another hereditament of—
(i) 	the VTE,
(ii) 	a valuation tribunal, or
(iii) 	the Lands Tribunal, the Upper Tribunal or a court determining an appeal or application for review from the VTE, a valuation tribunal, the Lands Tribunal or the Upper Tribunal,
to be or to have been inaccurate;
(f) 	the day from which an alteration is shown in the list as having effect is wrong;
(g)	a hereditament not shown in the list ought to be shown in that list;
(h) 	a hereditament shown in the list ought not to be shown in that list;
(i) 	the list should show that some part of a hereditament which is shown in the list is domestic property or is exempt from non-domestic rating but does not do so;
(j) 	the list should not show that some part of a hereditament which is shown in the list is domestic property or is exempt from non-domestic rating but does so;
(k) 	property which is shown in the list as more than one hereditament ought to be shown as one or more different hereditaments;
(l)	property which is shown in the list as one hereditament ought to be shown as more than one hereditament;
(m) 	the address shown in the list for a hereditament is wrong;
(n) 	the description shown in the list for a hereditament is wrong; and
(o) 	any statement required to be made about the hereditament under section 42 of the Act has been omitted from the list.
(2) Subject to paragraph (3), a proposal may be made—
(a) 	by an IP who has reason to believe that one of the grounds set out in paragraph (1) exists;
(b) 	by a relevant authority which has reason to believe that a ground set out in any of subparagraphs (b), (e) and (g) to (j) of paragraph (1) exists; and
(c) 	by a person, other than an IP, who—
(i) 	has reason to believe that a ground set out in paragraph (1)(c), (d) or (f) exists, and
(ii) 	was an IP at any time during which the alteration or amendment in question had effect.
Time from which alteration is to have effect: 2005 and subsequent lists
14.—(1) This regulation has effect in relation to alterations made on or after 1st October 2009 to a list compiled on or after 1st April 2005.
(2) Subject to paragraphs (3) to (7), where an alteration is made to correct any inaccuracy in the list on or after the day it is compiled, the alteration shall have effect from the day on which the circumstances giving rise to the alteration first occurred.
(3) Subject to paragraph (4), where an alteration is made to give effect to a completion notice, the alteration shall have effect from the day specified in the notice.
(4) Where under Schedule 4A to the Act a different day—
(a)	is substituted by a different notice under paragraph 1(3) of that Schedule;
(b) 	is agreed under paragraph 3 of that Schedule; or
(c) 	is determined in pursuance of an appeal under paragraph 4 of that Schedule,
the alteration shall have effect from the day so substituted, agreed or determined.
(5) Where the day on which the relevant circumstances arose is not reasonably ascertainable—
(a)	where the alteration is made to give effect to a proposal, the alteration shall have effect from the day on which the proposal was served on the VO; and
(b) 	in any other case, the alteration shall have effect from the day on which it is made.
…..
(7) An alteration made to correct an inaccuracy (other than one which has arisen by reason of an error or default on the part of a ratepayer)—
(a)	in the list on the day it was compiled; or
(b) 	which arose in the course of making a previous alteration in connection with a matter mentioned in any of paragraphs (2) to (5), 
which increases the rateable value shown in the list for the hereditament to which the inaccuracy relates, shall have effect from the day on which the alteration is made.
(8) Where an alteration needs to be made after the first anniversary of the day on which the next list is compiled, it shall have retrospective effect only if it is made to give effect to a proposal.
…..
Effective date to be shown in the list
16. Where an alteration is made, the list shall show the day from which the alteration is to have effect.
Notification of alteration
17.—(1) Within four weeks of altering a list a VO shall notify the relevant authority of the effect of the alteration; and the relevant authority shall as soon as reasonably practicable alter the copy of the list deposited at its principal office.
(2) Subject to paragraph (3), the VO shall notify the ratepayer and any proposer, as defined in paragraph (5), of—
(a)	the effect of the alteration; and
(b) 	subject to paragraph (4), the effect of the application of this Part, and of Part 5, in relation to the alteration.
(3) Paragraph (2) does not apply in relation to alterations made solely to correct a clerical error, or to reflect—
(a) 	a change in the address of the hereditament concerned; or
(b) 	a change in the area of the relevant authority.
(4) Paragraph (2)(b) does not apply in relation to an alteration made to reflect—
(a) 	a decision of the VO that a proposal is well-founded;
(b) 	a decision, in relation to the hereditament which is the subject of the proposal, of a valuation tribunal, the VTE, the Lands Tribunal, the Upper Tribunal or a court; or
(c) 	an agreement under regulation 12.
(5) The proposer mentioned in paragraph (2) is any proposer for whom an appeal in relation to the hereditament has been referred to the VTE under regulation 13(1) and whose appeal has either—
(a)	not been determined by the VTE; or
(b) 	has been so determined and either—
(i) 	an appeal has been made to the Lands Tribunal or the Upper Tribunal and has not been determined; or
(ii) 	the time for making an appeal to the Upper Tribunal has not yet expired.”
10.	On one reading, s.55(4)(a) LGFA 1988 seems to contemplate that valuation officers will make alterations to the rating list by means of a proposal and, under s.69 of the General Rate Act 1967, they and “persons aggrieved” were able to make proposals for the alteration of an existing list.  But it is clear from regulation 4(2) of the 2009 Regulations that the valuation officer is not now included in the list of persons eligible to make a proposal on one of the grounds permitted under regulation 4(1) and one consequence of this is that the valuation officer is not able to make an alteration to a prior list later than the first anniversary of the day on which the next list is compiled: see regulation 14(8).  In the present case, the list was altered on 22 March 2011 and the notice of alteration was sent on 23 March 2011. 
11.	The rôle of the valuation officer in relation to a proposal by an interested party is essentially responsive.  The proposal must be sent to and acknowledged by the valuation officer (see regulations 6(1) and 7(1)) but the valuation officer is also empowered under regulation 8 to serve notice disputing the validity of the proposal and, unless the notice is withdrawn, the remedy for the proposer is either to serve a further proposal or to appeal to the VTE: see regulation 8(6).  Where, however, as in this case, it is the valuation officer who initiates the process by making an alteration in the list, the statutory power to make the alteration has to be sought elsewhere.  LGFA 1988 does not explicitly empower the valuation officer to make alterations to the list of his own volition.  Section 55(2) simply confers a power on the Secretary of State to make regulations “about the alteration by valuation officers of lists which have been compiled”.  In the regulations the closest one gets to an express authorisation is regulation 17, although the drafting of this seems to assume that the power of alteration exists rather than to confer it. 
12.	To date the courts have resolved these ambiguities by treating the power of the valuation officer to alter the list for which he is responsible as implicit in his s.41 duty to maintain that list: see R v Valuation Office Agency ex parte Corus UK Limited [2001] EWHC Admin 1108 at [5] (Sullivan J); National Car Parks Ltd v Baird (Valuation officer) [2004] EWCA Civ 967 where the ratepayer relied on the duty under s.41(1) LGFA 1988 to maintain an accurate list as empowering the valuation officer to reduce the rateable value shown in the existing rating list.  But Ms Foster QC for BMC has for the first time on this appeal challenged this established understanding that the power to alter the rating list by a valuation officer subsists as a corollary to his s.41 duty and it is to this issue of vires that I first turn.
13.	BMC’s primary case on vires is that there is no power for a valuation officer to alter a rating list once it is compiled.  The power of alteration is limited to the making of a proposal which, as explained earlier, is no longer available to the valuation officer.  Although Ms Foster acknowledges the assumption made in cases like Corus about the existence of such a power, there is, she says, no decision as such on the point.  National Car Parks Ltd v Baird was a case in which the reduction in the rateable value was agreed with the valuation officer. 
14.	Rather than debating whether there is any direct authority in the cases on this point, it seems to me more useful to begin by looking at the statutory materials themselves.  As explained earlier, the scheme of the present legislation is to impose a statutory duty on the valuation officer under s.41(1) LFGA 1988 to compile and maintain the list and to take such steps as are reasonably practicable to ensure that it is accurately compiled: see s.41(4).  It might be thought odd that the person who is made responsible for compiling an accurate list and for maintaining it does not have the power to amend the list from time to time in order to maintain its accuracy.  The valuation officer’s case is that this power is either implied as part of the s.41 duty or is contained in the regulations which the Secretary of State is empowered to make under s.55.  This is said to be confirmed by s.55(2) which in terms contemplates the making of regulations allowing valuation officers to alter a list in order for it to be accurately maintained: see s.55(3).  The end of this particular trail is regulation 17 which sets out the procedures to be followed when a valuation officer alters a list. 
15.	BMC’s response to the valuation officer’s reliance on s.55 is that it is concerned with the regulation of a power which has not in fact been conferred by LGFA 1988.  Ms Foster accepts that the existence of such a power appears to be contemplated by the 2009 Regulations because regulation 14(5), for example, refers both to an alteration made to give effect to a proposal and to “any other case”.  But it is not possible, she submits, to read back from the regulations so as to imply the existence of a power in the statute which is not there.  She has referred us to the speech of Viscount Dilhorne in Stock v Frank Jones (Tipton) Ltd [1978] 1 WLR 231 at 234-5 where he said:
“… “It is a strong thing to read into an Act of Parliament words which are not there, and in the absence of clear necessity it is a wrong thing to do” said Lord Mersey in Thompson v. Goold & Co. [1910] A.C. 409, 420. “… we are not entitled to read words into an Act of Parliament unless clear reason for it is to be found within the four corners of the Act itself” said Lord Loreburn L.C. in Vickers, Sons & Maxim Ltd. v. Evans [1910] A.C. 444, 445.”
16.	BMC contends that there is no clear necessity in this case because the valuation officer can correct any intervening errors when he comes to compile the next list.  That, of course, is true but the duty imposed by s.41 is not limited to compiling an accurate list.  The valuation officer must also maintain it.  The courts have hitherto assumed (if not decided) that this imports an obligation to maintain the list in an accurate form which, of course, is what s.55(3) refers to.  
17.	Ms Foster’s response to this is to say that the word “maintain” has no technical meaning and she has referred to a number of different contexts in which the word is used such as a covenant in a lease or a statutory duty to maintain a building.  The ordinary meaning of the word (supported by these examples) is that of keeping something in the same condition or state of repair as it was.  Transposed to the present case, the s.41 duty does no more, she says, than to require the valuation officer to maintain the list as compiled. 
18.	For my own part, I do not find these examples of much assistance in construing s.41.  Like all language, the word “maintain” has to be considered in the particular context in which it is used having regard to the purpose and effect of the statute in question.  It seems to me obvious that “maintain” in the context of s.41 must be read as imposing on the valuation officer an obligation to maintain the list in an accurate rather than an inaccurate state and not merely to preserve it as, in effect, an historic snapshot of the position on the ground on the date when the list came into effect.  This interpretation seems to me to be consistent with s.55 LGFA 1988 which is relevant to a consideration of the scope of s.41.  BMC’s construction also produces the result that although the list can be altered during the period in which it remains effective by a proposal made by an interested party, it cannot be altered by the valuation officer except in response to such a proposal.  This gives the lie to the suggestion that the list was intended to be a static document but, on BMC’s case, produces a scheme for alteration of the list mid-term which is unbalanced and illogical.
19.	Ms Foster submits that this construction of LGFA 1988 would represent a substantial departure from the position under previous legislation which conferred on the valuation officer express powers to alter the list by making a proposal and contained clear provisions as to the circumstances in which such powers could be exercised.  She is undoubtedly right that both the Local Government Act 1948 and the General Rate Act 1967 allowed the list to be altered by proposals made either by the valuation officer or an interested party: see s.40(1) and (2) of the 1948 Act and ss. 68-9 of the 1967 Act.  LGFA 1988 represents a departure from this scheme in that it continues to impose a duty on the valuation officer to compile and maintain the list but delegates the power of amendment to regulations which the Secretary of State is empowered to make. 
20.	But Ms Foster has not produced any obvious or compelling reason why this change in the structure of the legislation (which I will return to in more detail when I consider the second part of the appeal) should have been intended to deprive the valuation officer of a power to amend the list of his own volition.  Given that the owners and occupiers of rateable property have no obligation to notify the valuation officer of the creation or existence of a rateable hereditament, the absence of a power of amendment by the valuation officer seems less than readily explicable.
21.	It is, of course, possible that the draftsman of LGFA 1988 has produced a defective statutory scheme but that is not a conclusion which the court usually accepts unless compelled by the provisions of the legislation to do so and, in my view, this is not such a case.  It seems to me, for the reasons I have indicated, that the duty imposed on the valuation officer by s.41(1) is one to maintain the list in an accurate form.  I do not accept that it is limited to the maintenance of the list as compiled.  The observance of that duty is to be facilitated by the process contained in Part III of LGFA 1988 (“in accordance with this Part”) which includes s.55.  This expressly empowers the Secretary of State to make regulations about the alteration of the lists by valuation officers which regulation 17 does.  Insofar as is necessary, one can imply a power into the s.41 duty itself but my own view is that s.55(2) is an enabling power designed to facilitate the execution of the s.41 duty and that this has been accomplished by regulation 17.  A similar view was expressed by Morritt LJ in National Car Parks Ltd v Baird (at [42]) where he said:
“There is no doubt that the valuation officers are under a statutory duty to maintain accurate rating lists. That is what s.41(1) provides. But, as s.41(1) also provides, that duty is to be performed in accordance with part III of the 1988 Act. Part III includes s.55 and the Regulations made thereunder and those regulations, as prescribed by reg 3, apply to any alteration whether effected pursuant to a proposal or by the valuation officer on his own initiative. Specifically, reg 13 prescribes the time from which an alteration is to take effect whether or not made pursuant to a proposal. In my view the President was correct when, in para 49 of his decision, he rejected the suggestion that s.41(1), as opposed to s.55 and the regulations, was the statutory foundation for specific duties and rights.”
22.	This construction of the Part III provisions as imposing a continuing duty to maintain an accurate list is, I think, supported by s.42(1) which requires the list to show “… for each day in each chargeable financial year for which it is in force, each hereditament which fulfils the following conditions on the day concerned …”.  BMC’s submission that the valuation officer’s power to correct mistakes is limited to the compilation of a new list is simply inconsistent with these provisions.  Ms McCarthy provided other examples of provisions in LGFA 1988 which would be otiose or redundant were the valuation officer to have no power of his own to alter the list: see e.g. s.46A and Sch 4A which provide for unoccupied new buildings to be added to rating lists.  These points are well made but it is not necessary to consider them in further detail.
23.	I would therefore give the appellant permission to rely on this new ground which was to some extent the product of questions which we ourselves raised but dismiss this ground of appeal.
24.	BMC’s alternative case is that an alteration to the list by the valuation officer which leads to a proposal by an interested person challenging the alteration ultimately engages the provisions of regulation 14(5) which exclude the power of the valuation officer to make retrospective alterations to an existing list where the day on which the event (“the relevant circumstances”) giving rise to the alteration occurred is not reasonably ascertainable.  
25.	In the present case the valuation officer gave notice of his intention to include the Property in the list on 22 March 2011 with the effective date of 15 March 2008 and BMC then submitted its own proposal originally relying on ground (d) in regulation 4(1).  But subsequently on the appeal to the VTE it was allowed to rely on grounds (f) and (h).
26.	The dispute between the parties in relation to the second part of the appeal centres on what is meant by the words “circumstances giving rise to the alteration” in regulation 14(2).  BMC contend that these words refer to (and only to) the change of use or other event affecting the hereditament which occasions the alteration in the list and not to the fact that the hereditament has been wrongly omitted from the list.  In other words, that the “circumstances” are limited to the physical or other circumstances which affect the rateability of the Property.  If this is right then it follows, Ms Foster submits, that the “day on which the relevant circumstances arose” for the purposes of rule 14(5) must be when the change of use occurred and not when it became apparent that the list was inaccurate because of the omission of the Property as a rateable hereditament.  On this basis the valuation officer had no power to include the Property in the 2005 list because, by virtue of regulation 14(5)(b), the earliest effective date for any alteration was 22 March 2011 which post-dates the period of the 2005 list.  Since the alteration made and BMC’s subsequent proposal relate only to the 2005 list, no question of amending the 2010 list arises so that, absent the alteration of that list, the valuation officer’s remedy is to wait until the 2017 list comes to be prepared.  
27.	In support of this construction of the phrase “circumstances giving rise to the alteration”, Ms Foster began her submissions by reminding us of the general principle of statutory construction that clear words are necessary in order for what amounts to a taxing statute to be given retrospective effect: see e.g. Greenberg v Inland Revenue Commissioners [1972] AC 109 at page 143.  But, in the context of the relevant legislation, the application of that principle requires some qualification.  As mentioned earlier, it is clear from s.55(6) LGFA 1988 that regulations made for the alteration of an existing rating list may include provision for the change to be retrospective in effect in relation to the payment of rates and any interest.  The focus of any requirement for clear words must therefore be on the conditions set by the regulations for giving retrospective effect to any alteration rather than on whether the regulations are capable of having that effect.  Regulation 14(2) of the 2009 regulations defines the effective date of an alteration to the 2005 or any subsequent list which is made in order to correct an inaccuracy in the list as “the day on which the circumstances giving rise to the alteration first occurred”.  The same sub-paragraph of the regulations makes it clear that the inaccuracy in question may be one which exists either on the day the list is compiled (in this case 1 April 2005) or a later date.
28.	BMC’s argument is that the circumstances giving rise to the alteration are not the inaccuracy itself which obviously did exist and was known to have existed on 1 April 2005 when the alteration came to be made in 2011 but rather the underlying change of factual circumstances (in this case the commencement of the use of the Property for holiday lettings) which created the inaccuracy in the list.  This has to be BMC’s argument because otherwise regulation 14(5) would have no application at all to the present case.  No-one suggests that the phrase “relevant circumstances” in regulation 14(5) should be construed to mean something different from “the circumstances giving rise to the alteration” in regulation 14(2).  Unless therefore the relevant circumstances are restricted to the underlying change in the use of the Property, the doubt surrounding the precise commencement of the holiday letting business does not avail BMC.  The day on which the relevant circumstances in the shape of the inaccuracy in the list arose was reasonably ascertainable in the sense that it was known to exist as at 1 April 2005.
29.	To support BMC’s construction of “relevant circumstances” Ms Foster relies on the use of the same phrase in other parts of the 2009 regulations but has also referred us to the legislative history leading up to the current form of the regulations.  In relation to internal indicators as to what “relevant circumstances” may include, Ms Foster referred to the use of the phrase “material change of circumstances” in regulation 4(1)(b) which is one of the circumstances in which a proposal for an alteration in the list may be made.  “Material change of circumstances” is, however, a defined term in the 2009 regulations limited to the matters set out in paragraph 2(7) of Schedule 6 to LGFA 1988: see regulation 3.  The specified matters include such things as the physical state and mode of occupation of the hereditament which are used as the basis for the calculation of the rateable value of the hereditament.  They are not relevant to a proposal to alter the list made under regulation 4(1)(g) or (h) and do not therefore assist to determine the scope of “relevant circumstances” under regulation 14(2) and (5).
30.	Of more interest is regulation 15(1) which deals with advertising rights.  It states:
“(1) Regulation 14 shall have effect, where the circumstances giving rise to the alteration are the coming into existence of an advertising hereditament, as if those circumstances occurred when—
(a) 	any structure or sign is erected, after the right constituting the hereditament has been let out or reserved, to enable the right to be exercised; or
(b) 	any advertisement is exhibited in exercise of the right,
whichever is earlier; and such a hereditament shall be treated for the purposes of Part 3 of the Act as coming into occupation at that time.”
31.	The purpose of the regulation is to define when a hereditament comprising an advertising hoarding or similar structure is to be deemed to come into existence so as to permit an alteration to the list either pursuant to a proposal under regulation 4(1)(g) or by the valuation officer under regulation 17.  Regulation 15 is relied on by BMC as confirming that “the circumstances giving rise to the alteration” under regulation 14(2) consist of the underlying physical change (in that case the erection of the hoarding or other structure) rather than the inaccuracy in the list which the existence of the new hereditament has created.  What regulation 15 clearly demonstrates is that “the circumstances giving rise to the alteration” and therefore “the relevant circumstances” in regulation 14(5) can consist of the change in use or other physical change of circumstances which creates or destroys a hereditament or requires some other alteration to the list.  But it does not, I think, follow from the identification of the regulation 15 event as “circumstances giving rise to the alteration” that this phrase in the context of regulation 14(2) can have no wider meaning which includes the inaccuracy in the list occasioned by the change.  Regulation 15 is a good example of what type of specific circumstances can fall within the regulation 14(2) framework.  But to treat it as definitive would be to read too much into it and to treat regulation 15 rather than regulation 14(2) as the governing provision.  One needs, I think, to look at regulation 14 schematically and, for this purpose, both parties have referred us to the legislative history.
32.	The rating system can be traced back to the Elizabethan Poor Law Act 1572.  But a convenient place to begin for the purposes of this appeal is with the Local Government Act 1948.  As mentioned earlier, this provided for amendments to the list to be made by proposals either from an interested party or from the valuation officer himself including in cases where a new rateable hereditament had come into existence.  Section 42(1) provided that alterations made in the rating list were to have effect as from the commencement of the period in respect of which the rate was made but this was qualified by s.42(2) where, inter alia, the alteration was occasioned by the creation of a new hereditament.  So s.42(2) provided:
“(2) Notwithstanding anything in subsection (1) of this section an alteration in the valuation list which either—
(a)	consists of the inclusion in the valuation list of a newly erected or newly constructed hereditament or an altered hereditament which has been out of occupation on account of structural alterations ; or
(b)	is made by reason of a change in the value of a hereditament caused by the making of structural alterations or by the total or partial destruction of any building or other erection by fire or any other physical cause ; or
(c)	is made by reason of any hereditament having become or ceased to be an agricultural, industrial or freight transport hereditament, or of a change in the proportion in which an industrial or freight transport hereditament is occupied and used for industrial or, as the case may be, transport purposes and for other purposes respectively ; or
(d)	is made by reason of any hereditament becoming or ceasing to be a hereditament which," under Part V of this Act, is not liable to be rated; or
(e)	is made by reason of any change in the extent to which a railway or canal hereditament, as defined for the purposes of Part V of this Act, is occupied for non-rateable purposes, as so defined ; or
(f)	is made by reason of any property previously rated as a single hereditament becoming liable to be rated in parts; or
(g)	is made by reason of any property previously rated in parts becoming liable to be rated as a single hereditament. 
shall have effect only as from the date when the new or altered hereditament comes into occupation, or as from the happening of the event by reason of which the alteration is made, as the case may be.”
33.	The immediate statutory pre-cursor to LGFA 1988 was the General Rate Act 1967.  This again as a default rule adopted the commencement of the relevant rating period as the effective date of any alteration made to an existing list: see s.79(1).  But it preserved and created exceptions to this rule in s.79(2) which, like the 1948 Act, included the creation of new hereditaments.  Also included in the exception were a list of some eight events specified in s.68(4)(b) to (h) (defined as “material change of circumstances”) all of which, as this description suggests, involved some material alteration in the value or rateability of an exiting hereditament.  In such cases the alteration took effect (as under the 1948 Act) either from the date when the new hereditaments came into occupation or “from the happening of the event by reason of which the alteration is made as the case may be”.
34.	The principal change effected by LGFA 1988 was to delegate to the Secretary of State the power to specify by regulation the procedure and conditions for effecting alterations to an existing rating list.  The valuation officer was required by s.42(4) to ensure that the list was, so far as reasonably practicable, accurately compiled and to maintain the list.  The original regulations made in 1990 (SI 1990 No. 582) introduced for the first time the terminology of “the circumstances giving rise to the alteration” and “relevant” circumstances.  Regulation 4(2) of the 1990 regulations (reflecting s.79(2)(a) of the General Rate Act 1967) provided that alterations to the list made to include in the list newly created hereditaments or to delete hereditaments which had ceased to be rateable should take effect “from the day on which the circumstances giving rise to the alteration occurred: i.e. when the relevant hereditament came into existence or ceased to exist: see regulation 4(2)(a).  A similar rule was applied to cases involving a material change of circumstances (defined by reference to Schedule 6, para 2(7) of LGFA 1988): see regulation 4(5).  This carried forward the provisions of s.79(2)(b) of the 1967 Act. 
35.	The 1990 regulations also contained in regulation 4(6) provisions similar in some respects to those now contained in regulation 14(5).  Regulation 4(6) stated:
“(6) Where for the purposes of paragraph (5) the day on which the relevant circumstances arose is not reasonably ascertainable
(a)	where the alteration is made in pursuance of a proposal (other than one disputing the accuracy of a previous alteration to the list), the alteration shall have effect from the day on which the proposal was served on the valuation officer;
(b)	where the alteration is made in pursuance of a proposal disputing the accuracy of a previous alteration to the list, the alteration shall have effect from the day on which the disputed alteration fell to have effect; and
(c)	in any other case the alteration shall have effect on the day on which it is entered in the list.”
36.	It is important to note that regulation 4(6) had no application to a case falling under regulation 4(2): i.e. an alteration made to record a new hereditament created since the date the list was compiled.  So in those cases the alteration to the list would inevitably take effect earlier than the date of the proposal (if there was one) or the valuation officer’s alteration of the list.  What regulation 4(2) did not cater for was a case such as the present one where the newly rateable hereditament had come into existence either on or before the date on which the rating list was compiled.  To correct this omission the Non-Domestic Rating (Alteration of Lists and Appeals) (Amendment) Regulations 1990 SI 1990/769 inserted a new paragraph 6A and 6B which provided:  
“(6A) An alteration made to correct an inaccuracy in a list on the day it was complied shall have effect from that day.
(6B) An alteration made to correct an inaccuracy in a list (other than an alteration which falls to take effect as provided in the foregoing provisions of this regulation) shall have effect from the day on which the list became inaccurate.”
37.	Ms Foster submits that if the valuation officer’s construction of the words “circumstances giving rise to the alteration” in the 2009 Regulations is correct and applies to the same words in regulation 4(5) then the amendment to the regulations was unnecessary so far as it applied to any inaccuracy in the list on the day it was compiled arising from one of the matters listed in Sch 6 para 2(7).  She says that the “circumstances” in regulation 4(5) must in their context be a reference to the underlying circumstances rather than the state of the list hence the need for the express provisions of new regulations 4(6A) and (6B).
38.	I am less sure about how much help on construction one can derive from regulations 4(6A) and (6B) but it does not matter.  The valuation officer does not really quarrel with this interpretation of the 1990 Regulations.  Ms McCarthy’s main point is that BMC’s argument on construction in relation to the 2009 Regulations depends upon giving the same meaning to “circumstances” in regulation 14(2) of the 2009 Regulations as on BMC’s argument the same word bears in the 1990 Regulations such as regulation 4(2).  The “circumstances giving rise to the alteration” in regulation 14(2) are “any inaccuracy in the list on or after the day it is compiled”.  By contrast, the “circumstances giving rise to the alteration” in regulation 4(2) of the 1990 Regulations was specifically the underlying event in the form of a “hereditament which, since the list was compiled has come into existence”.  The same goes for regulation 4(5) which again identifies the circumstances as one of a series of specified events.
39.	An analysis of the 1990 and 1993 Regulations shows that regulations 4(2) and 4(5) continued in much the same form in regulations 13(2) and 13(5) of the 1993 Regulations and that regulation 4(6) which originally applied only to regulation 4(5) was continued as regulation 13(6) but with its application widened to include regulation 13(2).  This meant that amendments to the list due to material changes (such as the creation of a new hereditament (regulation 13(2)) or a change in the rateable value (regulation 13(5))) which occurred after the compilation of the list took effect from the day on which those circumstances occurred unless that day was not reasonably ascertainable.  In such cases regulation 13(6) postponed the effective date either to the date of service of the proposal or the date of alteration of the list.  But where the alteration was made under regulation 4(6A) or (6B) (later regulation 13(7)) to correct an “inaccuracy in a list on the day it was compiled” then regulation 13(6) (like regulation 4(6) before it) had, of course, no possible application.  The inaccuracy either did or did not exist on the day of compilation and, if it did, the alteration took effect from that date.
40.	This difference in treatment between inaccuracies in the list on the day of compilation or thereafter and alterations in order to cater for subsequent changes of circumstances confronted the draftsmen of the 2005 regulations.  Instead of making separate provision in terms of an effective date for what were previously regulation 13(2) and 13(5) events on the one hand and regulation 13(7) and (8) alterations to correct inaccuracies in the list on the other, there is now a composite regulation 14.  Regulation 14(2) which has continued without material amendment in the 2009 Regulations is obviously drafted in order to encompass both initial inaccuracies in the list due (e.g.) to the omission of a rateable hereditament and subsequent changes of circumstances which render the list inaccurate.  The list of circumstances which may give rise to an alteration of the list are set out comprehensively in regulation 4: see [9] above.  They include such matters as the omission of a hereditament from the list (regulation 4(1)(g)) which could occur either at the date of compilation or subsequently.
41.	Regulation 14(2) specifies a default rule in relation to the effective date of any alteration in the list “made to correct any inaccuracy in the list on or after the day it is compiled”.  The alteration takes effect “from the day on which the circumstances giving rise to the alteration first occurred”.  Looked at against the background of the earlier regulations, it seems to me that the day on which those circumstances first occurred must be a reference both to inaccuracies in the list on the day of compilation and ones which arise subsequently.  That much is apparent from the opening words of regulation 14(2).  It therefore includes what were originally regulation 13(2) and 13(5) circumstances as well as the inaccuracies in the list dealt with previously by regulations 13(7) and (8) to which the “not reasonably ascertainable” provisions contained in regulation 13(6) had no application.  It follows that I do not accept that “circumstances” in regulation 14(2) has only a single meaning, namely the underlying change of circumstances which leads to the inaccuracy in the list.  It also includes the former content of regulations 13(7) and (8): i.e. a subsisting inaccuracy in the list.  Aside from anything else, that is what regulation 14(2) says.
42.	The next issue is the scope of the exception contained in regulation 14(5).  As explained, up to and including the 1993 Regulations, this had no application to what were then regulation 13(7) and (8) cases.  Ms McCarthy says that nothing has changed.  Although the composite nature of regulation 14 has resulted in regulation 14(2) specifying an effective date rule which can apply both to an error in the list and to a particular change of circumstances, there is no discernable policy reason why the provisions of what is now regulation 14(5) should be applied to the former.  The presumption of continuity suggests the contrary.
43.	The phrase “relevant circumstances” used in regulation 14(5) must be a reference back to regulation 14(2).  BMC’s argument that the phrase should be given a meaning limited to the underlying circumstances, even if right, does not assist it if it is wrong (as I believe it is) about the construction of regulation 14(2).  It merely confirms that regulation 14(5) is restricted in its application to what were previously regulation 13(2) and 13(5) circumstances and not to an inaccuracy in the list either at or after the day of compilation.  Inaccuracies in the list continue to be governed solely by the default rule in regulation 14(2).
44.	But even if one gives “relevant circumstances” a wider meaning so as to include any alteration covered by regulation 14(2), the result is the same.  The inaccuracy in the 2005 list on the day of its compilation was reasonably ascertainable when the alteration was made in 2011.  Although it was not possible to identify precisely when the commercial use of the property began, it was common ground that it had started long before 1 April 2005.  Regulation 14(5) has therefore no possible application to cases of this kind involving changes in circumstances which pre-date the compilation of the relevant list.
45.	I would therefore dismiss the appeal. 
Lady Justice King :
46.	I agree.
Dame Janet Smith :
47.	I also agree.
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