Rossendale Borough Council v - Hurstwood Properties (A) Ltd & Ors

Rossendale Borough Council v - Hurstwood Properties (A) Ltd & Ors

The particulars of claim do not disclose reasonable grounds for alleging that the scheme leases are sham transactions or that the Ramsay principle applies to disregard them. However, there is an arguable case for piercing the corporate veil under the principles in Prest v Petrodel, as the doctrine is developing and the facts may support such a claim at trial. The money claims for business rates may proceed if properly pleaded regarding service of statutory demand notices.

Parties
Claimant: Rossendale Borough Council; Defendants: Hurstwood Properties (A) Limited & Others; Claimant: Wigan Council; Defendant: Property Alliance Group Limited
Jurisdiction
England and Wales
Judgment Date
30 November 2017
Procedural Posture
Civil (business Rates Recovery) / Strike Out Application (interlocutory)
Outcome
Strike out application dismissed in part; claim may proceed on the veil-piercing ground and money claims if properly pleaded.
Legal Topics
Business Rates Avoidance Schemes, Sham Transactions, Piercing the Corporate Veil, Application of the Ramsay Principle, Strike Out Applications Under CPR 3.4(2)
Tax Law Corporate Law Civil Procedure Business Rates Avoidance Schemes Sham Transactions Piercing the Corporate Veil Application of the Ramsay Principle Strike Out Applications Under CPR 3.4(2)

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Parties

Rossendale Borough Council

Claimant

Hurstwood Properties (A) Limited & Others

Defendants

Wigan Council

Claimant

Property Alliance Group Limited

Defendant

Procedural Posture

Civil (business Rates Recovery) / Strike Out Application (interlocutory)

Legal Issues

  1. 1 Whether the particulars of claim disclose reasonable grounds for bringing a claim against the Defendants for business rates allegedly avoided via tax schemes
  2. 2 Whether the scheme leases are sham transactions
  3. 3 Whether the Ramsay principle applies to disregard the scheme leases

Ratio Decidendi

The particulars of claim do not disclose reasonable grounds for alleging that the scheme leases are sham transactions or that the Ramsay principle applies to disregard them. However, there is an arguable case for piercing the corporate veil under the principles in Prest v Petrodel, as the doctrine is developing and the facts may support such a claim at trial. The money claims for business rates may proceed if properly pleaded regarding service of statutory demand notices.

Court Disposition

Strike out application dismissed in part; claim may proceed on the veil-piercing ground and money claims if properly pleaded.

Orders

  • The claims based on sham and Ramsay principle are struck out for disclosing no reasonable grounds.
  • The claims based on piercing the corporate veil and money claims for business rates may proceed, subject to proper pleading of service of demand notices.