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Appeal No. VA88/0/100 AN BINSE LUACHÁLA St. Macartan's Diocesan Trust APPELLANT RE: St. Patrick's Agricultural College, Co. Monaghan B E F O R E JUDGMENT OF THE VALUATION TRIBUNAL By Notice of Appeal dated 18th August 1988 the appellants appealed against the decision of the respondent refusing them exemption from rates on the grounds of the public user and charitable user of the hereditaments in question. The appellants claim that the property was used for public and charitable purposes and, accordingly, that it is exempted by virtue of the Poor Relief (Ireland) Act 1838 or alternatively the Valuation (Ireland) Act 1852 Section 16 and the Valuation (Ireland) Act 1854, Section 2. Messrs McEntee & O'Doherty, solicitors, of 20 North Road, Monaghan presented written submissions on the 18th day of August 1988. This submission was accompanied by the following documents - (a) Copy Rate Demand dealing with the subject matter of the appeal which
relate to the townland of Drumgoask, Land Valuation £77. Building
£76. Mr Patrick McMorrow B.Agric. Sc. who is a valuer with 7 years experience in the Valuation Office presented a written submission dated 7th October 1988. The valuation history of the hereditaments in question is as follows: Prior to 1967 the premises was described as "house, offs, gate lodge, gardener's house and land" with R.V. £76.00 on buildings and £77.00 on land - total R.V. £152.00. Following a request for revision in 1967 to "value broiler houses etc. - fowl houses" the description was amended to "house, offs, gate lodge, poultry houses, gardener's house and land" and the buildings R.V. was increased to £115.00. On ensuing First Appeal the description was further amended to "Agricultural College, offs. and land" and the buildings R.V. was reduced to £76.00 and has not since been altered. On annual revision in 1981 and 1982 the premises was again listed for revision - "Seeking Exemption". No change was made and these decisions were not appealed. It was again listed for revision in 1987 as follows "Revise - request to remove rateable valuation..." and no change was made. The basis of appeal then was "That the premises are premises used for public purposes and as such are exempt from rates". There was no appeal made against quantum. The oral hearing took place on the 21st October 1988 when Mr Patrick O'Doherty of McEntee & O'Doherty represented the appellants and when the evidence of Rev. Thomas Finnegan, Rector at the College, as well as Mr Bernard O'Neill who is in charge of teaching at the College, was heard. Mr. Aindrias O'Caoimh, Barrister, instructed by the Chief State Solicitor, represented the Respondent and Mr. McMorrow was also in attendance at the hearing. The following matters were established to the satisfaction of the Tribunal:- 1. The property under appeal is the subject matter of Folio 881 (Revised) Co. Monaghan of which the registered owners are stated to be Most Rev. Eugene O'Callaghan, the Right Reverend Patrick Monsignor McKeown, the Very Reverend Hugh Canon Finnegan and the Reverend Seamus Morris who held same for the Diocese of Clogher and who were registered as owners on 10th November 1983. 2. St Macartan's Diocesan Trust was incorporated on 20th March 1944 inter
alia to take over from the existing owners of St. Patrick's College the
lands 3. In or about the year 1941/42 the then Bishop of Clogher, Dr. McKenna, decided that the diocese should provide a college for boys who were interested in agriculture and who for various reasons were not interested in attending the diocesan secondary college, St. Macartan's Seminary to pursue a more academic course. At the start, St. Patrick's was run in conjunction with St. Macartan's Seminary. The moneys used to set up St. Patrick's were provided by the Diocese of Clogher and collections were taken up in the churches of the diocese to fund the enterprise. The aims of the college were to improve agricultural conditions: It was also "to give as large a number as possible of the more capable and intelligent boys from the rural districts a more advanced religious and cultural education; to inculcate a proper pride in their profession; to imbue them with a spirit of self-respect and self-reliance, and, in short, to fit them for the position of leaders in Catholic thought and action in the rural communities, "according to a prospectus of the time. 4. By an agreement dated 6th December 1944, between the Most Reverend Eugene O'Callaghan and others of the one part (referred to as "the proprietors") and the Minister for Agriculture of the other part it was agreed that the proprietors should provide and equip as soon as might be to the satisfaction of the Minister a science laboratory and workshop for manual training at the college. The proprietors agreed to carry on at the college a school for agriculture for boys in accordance with the programme of agricultural education for the time being approved of by the Minister. The programme set out what should be done. The proprietors agreed that during the currency of the agreement no religious test would be applied in the selection of admission of pupils to the college. 5. There was a further agreement entered into between the proprietors and the Minister on 4th March 1949. 6. Ever since the college has been used as an agricultural college and it is truly non-denominational in its acceptance of students. 7. ACOT (now Teagasc) pay the salaries of four teachers, three technicians,
one matron, one secretary and one maintenance man and the college itself
pays the salaries of four farm labourers, four kitchen staff and Reverend
Thomas Finnegan, the rector of the college. In addition, a capital grant
is paid by the Department of 8. At present there are 49 students in the college. The number of students per annum varies from 45 to 55. Those students who live-in pay £1250 per annum and those who do not live-in pay £1150 per annum which is to cover their meals and towards educational trips. (If any student wished to supply his own meals, he would not be charged.) The Tribunal is satisfied that the money paid goes to support the students and that there is no "profit" made by the Trust. 9. The Tribunal is satisfied that the St Macartan's Diocesan Trust is a charitable organisation for the Diocese of Clogher. It was set up for the purpose of affording free education in agriculture and horticulture to boys who might not be interested in purely academic subjects provided in the sister college, St. Macartan's. 10. The college is open to all irrespective of class or creed and with
no geographic boundaries. The Tribunal is in no doubt that if it had to decide the case on the basis that this was a trust for advancement of education and, therefore, a charity within the principles enunciated in the famous case of Commissioners for Special Purposes of Income Tax v. Pemsel (1891) A.C. 531 or on the basis that this is a form of charity which consists of giving to the deserving, which is justice (Cf. per Mr Justice Walsh in McGee v. Attorney General (1974) I.R. 284 at 319) its task would have been an easy one in deciding that the premises should be declared exempt. However, the matter cannot be resolved so simply as was demonstrated by the extensive legal arguments presented by both sides in the course of the oral hearing. The Tribunal is required to review the various statutes which govern this matter. The Valuation (Ireland) Act 1854 Section 2 provides that in making out the lists or tables of valuation mentioned in the Valuation (Ireland) Act 1852, the Commissioner of Valuation shall distinguish all hereditaments and tenements or portions of the same of a public nature or used for charitable purposes or for the purposes of science, literature and the fine arts as specified in 5 and 6 Vict., c. 36, and that all such hereditaments or tenements or portions of the same, so distinguished, shall as long as they shall continue to be of a public nature and occupied for the public service or used for the purposes of the aforesaid, be deemed exempt from all assessment for the relief of the destitute poor in Ireland and for grand jury and county rates. The grounds for exemption from rates (as the Supreme Court has held in
the cases of McGahon and Ryan v. Commissioner of Valuation (1934) I.R.
76 and Barrington's Hospital v. Commissioner of Valuation (1957) I.R.
299 are to be found in the proviso to S. 63 of the Poor Relief (Ireland)
Act 1838 - As Mr Justice O Dalaigh (as he then was) pointed out in the Barrington's Hospital case (at p. 340) the proviso is divided into four categories by the use of the conjunction, 'nor'. Aside from that proviso to that section of that Act, if one were to rely on Section 2 of the Valuation (Ireland) Act 1854, the Tribunal would not doubt that the hereditaments in question should be regarded as 'of public nature or used for charitable purposes'. Mr O'Doherty submitted that the college was one for the education of the poor in the sense that nowadays there is no such thing as education for the poor as such and that most are 'poor' in the sense that they do not belong to the better off strata of society which would be required to pay fees. But he, perhaps, placed greater stress on the final category and he relied on the decision of Judge Esmonde in the Franciscan College case that the premises were used for public purposes. The decision of the Supreme Court in the Barrington's Hospital case seems to the Tribunal to establish conclusively that in regard to education it must be read as limited to education of the poor and the poor exclusively. Mr Justice Kingsmill-Moore said that the following propositions would
appear to be warranted by the Irish authorities on the wording of the
proviso to S. 63 2, "Charitable purposes" in s. 63 has a meaning less extensive than the meaning given to those words in Pemsel's Case (3). How much less extensive has never been decided, but at least there must be excluded from the denotation of "charitable purposes" in the section of any charitable purpose which is mentioned expressly in the section (O'Neill's Case (4) and Scott's Case (5) as applied to s. 63). 3, Neither the wording of s. 63 nor any authority leads to the conclusion that "charitable purposes" means, or is confined to, "charitable purposes devoted exclusively to the benefit of the poor." 4, The word "exclusively," in no way alters or modifies the meaning of "charitable purpose." It does ensure that, in order to qualify for exemption, a building must be used for charitable purposes only. Where a building is used for mixed purposes, some charitable, some non-charitable, it is not exempt, though if the purposes are carried on in different buildings or in different parts of the same building s. 2 of the Valuation Act, 1854, gives power to the Commissioner to distinguish as exempt the buildings or portions of buildings which are exclusively used for charitable purposes. (O'Connell's Case (1), Clancy's Case (2), case of the Good Shepherd Nuns (3)). (1) 49 I.L.T.R. 103. (3) [1891] A.C. 531. Supreme 6, By parity of reasoning, even if the section required hospitals to be used exclusively for the treatment of the poor, the receipt of fees would not be a bar to exemption if such fees were subject to a trust to be applied to the use of the hospital and such hospital predominantly treated poor patients. As there is no such limitation to the treatment of poor patients in the section, the charging of fees in a hospital, where by the nature of the trust such fees must be applied to the use of the hospital, cannot affect the right to exemption. 7, Neither schools (O'Neill's Case (4)) nor hospitals (Royal Victoria
Hospital Case (9)) are used for charitable purposes if they are carried
on exclusively, or 8, The payment of masters or doctors to carry-on the charitable work
does not prevent the building in which the work is carried on from being
used exclusively for And as Mr Justice O Dalaigh said:- 'I accept that the charitable purposes referred to in s. 63 should in regard to education be read as limited to the education of the poor.' The Appellants next placed reliance on the Pembroke Schools case (1904) 2 I.R. 429 and the University College Cork case (1911) 2 I.R. 593. The Tribunal would wish to reproduce Davitt, P. 's analysis of these cases outlined in Maynooth College v. Commissioner of Valuation (1958 I.R. 189 at pp. 200 - 203 - In the Pembroke High Court 1959 In the University College, Cork Case(1) the King's Bench Division was unanimous in considering that the College was exempt as being used for public purposes; though divided on the question whether it was used exclusively for charitable purposes. Madden J. was of opinion that the considerations which led the Court to decide that the Pembroke School was occupied and used for public purposes were generally applicable to the College; but that there was in addition an element of supreme importance in the circumstances that under the provisions of the Universities Act of 1908 the accounts of the College, as well of the University of which it was a constituent were subject to audit by the Controller and Auditor General, and were required to be laid periodically before the House of Commons. The similarity to the Pembroke Case(2) is apparent in the circumstances that (1) the College, as Queen's College, Cork, was originally built with public moneys; (2) that it was maintained by means of a parliamentary grant and fees paid by students; (3) that the fees had to be devoted to the purposes of the College, (4) that the College was established under statute for purposes of great public utility; (5) that it was open to all comers without distinction of creed, class or sex; (6) that the public, by elected representatives, were admitted to a share in the government of the College. Madden J. was of opinion that it was impossible to lay down any general rule applicable to educational institutions; and that to state, as a general proposition, that an institution established for the promotion of such purposes of great public utility as University education, and the prosecution of literary and scientific research, even if supported in part by public moneys, was entitled to exemption from rateability, would be to adopt a principle which would have far-reaching consequences. It would appear that, for him, the determining factor was the requirement that the accounts of the College should be subject to audit by the Accountant and Auditor General, and laid before the House of Commons. He said that this was a recognition by the Legislature that the College funds must be applied exclusively to public purposes; and placed the College in the position of a State institution. Kenny J. preferred to base his decision on the view that the College was used exclusively for charitable purposes. Wright J. based his opinion that the college was used for public purposes on grounds similar to those which appealed to Madden J. The decision of the King's Bench Division was affirmed on appeal by the Court of Appeal, and, it would seem, (1) [1911] 2 I.R. 593 (2) [1904] 2 I.R. 420 High Court, 1956 High Court. mainly upon the same grounds. Barry L.C. was 1956 impressed
by the provisions of the Universities Act s.2 sub-s. 4 relating to "recognised
colleges," and those of s. 10 relating to Intermediate Education
Board and County Council Scholarships. He rejected the argument that the
expression "public purposes" in the proviso to s. 63 of the
1838 Act should be read as being ejusdem generis with purposes mentioned
earlier in the section and plainly referable to the benefiting of the
poorer classes. High Court, 1956 It appears that the result of the "intense judicial discussion on
... a much litigated section" is that property is "used for
public purposes" where, and only where - The Tribunal is in no doubt that the situation of these premises provides an anomaly because secondary schools are now given a measure of relief by the Local Government (Financial Provisions) Act 1978 and the other unfortunate thing is that the proviso to S. 63 of the 1838 Act, governs s. 2 of the 1854 Act. In all the circumstances, the Tribunal has reluctantly come to the conclusion that it must affirm the Respondent's decision in this matter. Decisions relied upon by Appellant: Decisions relied upon by Respondent:
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