Continuity of the Buxted ‘Occupied Together With’ Test in Agricultural Rate Exemptions

Introduction

Bunyan (Valuation Officer) v Fridays Ltd ([2025] EWCA Civ 666) is an appeal concerning the scope of the agricultural exemption from business rates under Schedule 5 to the Local Government Finance Act 1988, as amended in 2003. Fridays Ltd operates a network of free‐range egg farms and central packing buildings. The Upper Tribunal had held that a 2003 amendment to paragraph 3 of Schedule 5 altered the “occupied together with” requirement, but this Court of Appeal was asked to determine whether Parliament intended to change the occupation test or only to broaden the “use” test.

Parties:

Appellant: Bunyan (Valuation Officer)
Respondent: Fridays Ltd

Key issues: Interpretation of “occupied together with agricultural land” post-2003 amendment; interaction between occupation test and use test; application of the test to three packing buildings on Chequer Tree Farm.

Summary of the Judgment

The Court of Appeal unanimously dismissed the Valuation Officer’s appeal. It held that:

The 2003 amendment to paragraph 3 broadened solely the use test (allowing connection with other agricultural land), but did not alter the well‐established occupation test.
By carrying forward the identical wording “occupied together with agricultural land,” Parliament was taken to preserve the test as authoritatively defined in Farmer (VO) v Buxted Poultry Ltd [1993] AC 369.
Applying the Buxted occupation test, the three packing buildings were functionally and managerially integrated with the Fridays Farms, forming a single agricultural unit notwithstanding geographical separation.
The buildings were used solely in connection with regulated egg‐production operations on Fridays Farms and on independent farms, satisfying the broadened use test.

Analysis

Precedents Cited

Farmers’ Machinery Syndicate v Shaw (VO) [1961] 1 WLR 393 – occupation by syndicate committee did not qualify as “occupied together with” individual farms.
W & JB Eastwood Ltd v Herrod (VO) [1971] AC 160 – requirement that a building be ancillary to operations on the land together with which it is occupied (“thereon”).
Hambleton DC v Buxted Poultry Ltd [1992] 1 WLR 330 and Farmer (VO) v Buxted Poultry Ltd [1993] AC 369 – articulation of the occupation test: buildings must be in the same rateable occupation, jointly controlled, and functionally part of one agricultural unit.
Midlothian Assessor v Buccleuch Estates Ltd [1962] RA 257 – operations necessary to make a product marketable count as “in connection with” agricultural operations.

Legal Reasoning

1. Statutory framework: Schedule 5 to the Local Government Finance Act 1988 establishes two limbs for agricultural buildings:

Occupation test: “occupied together with agricultural land.”
Use test: “used solely in connection with agricultural operations on that or other agricultural land.”

2. 2003 amendment: Substituted “on that or other agricultural land” in paragraph 3(a), expanding the use test but leaving the occupation limb textually unchanged.

3. Presumption of consistency: Where Parliament re-enacts terminology that has received authoritative judicial interpretation, it is presumed that Parliament intended the established meaning to continue (per R (ZH and CN) v London Borough of Newham [2014] UKSC 62).

4. Occupation test preserved: The Court held that Parliament did not intend to alter the test first laid down in Buxted, which requires:

Common occupier of land and building.
Joint control or management.
A real functional unity forming a single agricultural unit (contiguity is relevant but not decisive, per Lord Slynn).

5. Application to facts: The three packing buildings and the Fridays Farms (Combwell, Tolehurst, Summer Hill, Waterlane) were under single ownership, jointly managed from Chequer Tree Farm, and engaged in indispensable grading/packing operations necessary to market eggs. Geographic proximity and operational interdependence satisfied the Buxted occupation test.

6. Use test satisfied: The buildings perform regulated weighing, grading and packaging essential to agricultural operations on both Friday farms and independent producers—thus used solely in connection with agricultural operations on “other agricultural land.”

Impact

This decision re-affirms the stability of rating law by preserving the Buxted occupation test. It ensures that the 2003 amendment does not inadvertently convert the exemption into a tax on businesses rather than land, and provides clarity to landowners, rating authorities, and tribunals on how to interpret “occupied together with” post-2003. Future cases must apply the established Buxted criteria before attributing exemption.

Complex Concepts Simplified

Hereditament: The unit of assessment for rates—usually a parcel of land with any buildings.
Occupation test: The requirement that a building and specified land share the same rateable occupation, under joint control, forming one agricultural unit.
Use test: The requirement that the building’s sole use is in connection with agricultural operations on that land or other agricultural land.
Single agricultural unit: A functional and managerial unity of land and buildings, even if not physically contiguous.
Keyes trays: Special trays used to transport eggs safely from production farms to packing centres.

Conclusion

The Court of Appeal’s ruling in Bunyan v Fridays Ltd preserves the integrity of the Buxted occupation test. Parliament’s 2003 amendment broadened only the “use” test to include operations on other agricultural land, but left the occupation limb intact. The judgment underscores the principle that identical statutory phrases carry consistent meaning across amendments unless explicitly changed. Fridays Ltd’s packing buildings remain exempt from business rates because they are occupied together with and used solely in connection with the agricultural operation of producing and marketing eggs.