Part 2: Appendix 1a - Examples following legislative amendments by the Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Act 2018 (England)

This appendix includes examples following legislative amendments by the Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Act 2018 (England).

Multi storey office buildings	How many hereditaments?	Why
Floors two and three of an office building occupied by the same company. The floor plates are directly above and below each other and they are both accessed via the common areas of the building.	1	The two floors pass the contiguity condition and can be treated as one hereditament.
A six-storey office building occupied by two separate companies. Company A occupies the ground to second floors and the fifth floor. Company B occupies the third and fourth floors. All floor plates are directly above and below each other and all access into the offices is via common areas of the building.	3	Company A has three contiguous floors but floor five is not contiguous to any part of their occupation. Company A is treated as having two hereditaments. Company B will be one because it passes the contiguity test for floors 3 & 4.
Four different companies occupy a six-storey office building. Floors one and two are unoccupied and were vacated by the same company on the same date. The ground floor and floors three to five are all occupied by the four different companies.	5	The four separate companies all have their own floor and will each be one hereditament. The two unoccupied floors pass the contiguity condition and were previously occupied by the same company who vacated on the same day, they are also in the same ownership. Therefore they can be treated as one hereditament.
A newly built five-storey office building has a completion notice served on the whole building and a Billing Authority Report has been sent to the VO requesting the building be brought into the rating list.	?	This will depend on the expected occupation pattern of the building which can be informed by the occupation of similar buildings in the local area. When a completion notice is served it is the VO’s responsibility to identify the hereditaments. This example could be one hereditament if the building has been built on an estate of five-storey office buildings with each one occupied by one single company. If local patterns of occupation suggest each floor will be occupied separately then, there should very likely be five hereditaments.
A two-storey office building on a business park with one hundred car parking spaces in a car park located to the front of the building. One company occupies the offices and the car park.	1	As there is one occupier and the office building and its associated car park pass the contiguity condition, this example should be treated as one hereditament.
A two-storey office building on a business park with one hundred car parking spaces in a car park located to the front of the building. One company occupies the ground floor and a separate company occupies the first floor. Each company has 50 clearly marked car spaces. The company on the ground floor has 50 car parking spaces to one side of the car park and the company on the first floor has 50 car spaces on the other side of the car park.	?	Taking the office building first as there are two different occupiers there will be two hereditaments. If the 50 car spaces which are occupied by the ground floor office occupier are contiguous to the ground floor of the building and each other, then the 50 car spaces can be included within the ground floor office hereditament. If the 50 car spaces are not contiguous to the ground floor of the office building (for example if there is a pavement/walkway separating them) then the car spaces will not form part of the ground floor hereditament. The first floor occupier and their car spaces will not form one hereditament as they are not contiguous to each other. The 50 car spaces allocated to the first floor occupier should form their own separate hereditament and be included within the Rating List.
A five-storey office building with an attached 100 space car park located within the basement. Each floor of the office building is occupied separately and they each have 20 spaces allocated to them within their leases. The 20 spaces are clearly marked and allocated and are all in groups of 20 which are contiguous to each other.	9	Each of the five separate floors within the office building will form its own separate hereditament. It is likely that the 20 car spaces allocated to the ground floor occupier will be included with the ground floor hereditament, dependent on the layout of the basement car park. The other groups of car parking will each form separate hereditaments each of 20 spaces as they will not be contiguous to the offices in the upper floors of the building.
A five-storey office building with an attached 100 space car park located within the basement. Each floor of the office building is occupied separately and has 20 car spaces allocated to them within their lease. None of the 100 car parking spaces are directly allocated to any particular occupier.	5 (or 6)	Each of the five separate floors within the office building will form its own separate hereditament. In this situation the value of the car park is exhausted by the mutual rights of the individual floor occupiers and should either be ignored or given a nominal value as a separate hereditament. The valuations will reflect the value of the non-dedicated parking, albeit with no mention in the description as the spaces do not form part of the office hereditaments.
Industrial Buildings
A terraced row of eight industrial units which front onto a shared yard. There are six separate companies occupying the units with one company occupying three units in a row. There is no internal access between any of the units.	6	The five companies which each occupy one unit all occupy one separate hereditament each. The company which occupies three separate units will be treated as occupying one hereditament as the three units in a row pass the contiguity condition and are in the same occupation.
Four industrial units with two on one side of a road and two on the other. Company A occupies two units which are on opposite sides of the road. Company A carries out a continuous manufacturing process with a lot of movement between their two units of people and fork lift trucks carrying materials. The other two units are separately occupied.	4	The two separately occupied units should be treated as two separate hereditaments. The two units situated across the road from each other in the same occupation are not contiguous and do not appear to pass the ‘necessary for effectual enjoyment’ test, which comes from the Supreme Court decision of Woolway v Mazars, and therefore cannot be treated as one hereditament.
Retail Property
Two adjacent shops units with no intercommunication in the same occupation	1	The two shops pass the contiguity condition and are occupied by the same company.
Two shop units in a shopping centre with no internal communication although one is located directly on top of the other and are in the same occupation.	1	The two shop units pass the contiguity condition and are occupied by the same company. There is still a need to consider the ‘corporate veil’ where the occupiers are parts of a larger single company.