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Appeal No. VA04/2/068 AN BINSE LUACHÁLA Gladstead Properties Ltd. APPELLANT RE: Holiday Complex at Lot No. Pt.1D.2, Brookfield,
Kilbarron, R.D. Borrisokane, North Tipperary, County Tipperary B E F O R E JUDGMENT OF THE VALUATION TRIBUNAL By Notice of Appeal dated the 15th day of June, 2004, the appellant appealed against the determination of the Commissioner of Valuation in fixing a rateable valuation of €445.00 on the above described relevant property. The Grounds of Appeal as set out in the Notice of Appeal are: This appeal proceeded by way of an oral hearing held in the offices of the Tribunal, Ormond House, Ormond Quay Upper, Dublin 7 on the 13th of October, 2004. At the hearing the appellant was represented by Mr. Owen Hickey, BL, instructed by Messrs Eugene F. Collins & Co. Solicitors and the respondent by Mr. Brendan Conway, BL, instructed by the Chief State Solicitor. Expert valuation evidence was given by Mr. Adrian Power Kelly, a partner in Messrs Harrington Bannon and Mr. Denis Maher, a Valuer in the Valuation Office, on behalf of the appellant and respondent respectively. Both parties having taken the oath adopted their respective précis, which had previously been received by the Tribunal as their evidence-in-chief. From the evidence so tendered, the following emerged as being the facts relevant and material to the appeal. The Property Facilities include: At the commencement of the hearing the parties informed the Tribunal that quantum was no longer at issue. The quantum was agreed at €430 of which €250 applied to the 14 cottages and €180 to the remainder of the subject property. The apartments are not self-contained and are without kitchens so therefore it was agreed by the parties that they should be rated. The rateability of the 14 cottages which were valued is at issue. The appellant says that they are domestic premises and entitled to exemption under paragraph 6, Schedule 4, Valuation Act, 2001 as relevant property not rateable. The respondent says they are a "mixed premises" and not entitled to exemption under the Valuation Act, 2001. Appellant's Submissions. • The cottages are used for dwelling purposes only and there is no question of their being mixed premises. The submission of Mr. Conway that they are a mixed premises is totally misconceived. • Mixed premises within the meaning of Section 3 of the Valuation Act, 2001 is "property which consists wholly or partly of a building which is used partly as a dwelling to a significant extent and partly for another or other purposes to such an extent." The section does not use the plural word "buildings". The section is identical in wording, apart from the word "hereditament" to the corresponding section 1 of the Local Government (Financial Provisions) Act 1978, now repealed. • In Kerry County Council v Kerins, Supreme Court, IR (3) 1996 (the Kerins case) the res judicata was based on the fact that the chalets were individually let out as holiday homes and were not used for any other purpose, apart from that of dwellings. Accordingly they were held to be domestic hereditaments under the Local Government (Financial Provisions) Act, 1978. The fact that they are commercially let does not matter as there was no mention of the dwellings having to be "private". • If it was the intention of the Legislature to rate property of
this type, then the Legislature could have done so. • As the cottages are used for dwelling purposes only they are domestic premises within the meaning of the Valuation Act, 2001 and accordingly are relevant property not rateable under Schedule 4 of that Act. Respondent's Submissions. • Mr. Conway departs from Mr. Hickey's analysis and says that his concept of "mixed premises" is too narrow. • The property inclusive of the cottages must be seen in its entirety
as a single holiday resort complex and should be rated as such. It is
a single business unit. When a guest takes a cottage he buys a package
of which the residential side is only one aspect, just as an apart-hotel
is part of the hotel business. • The definition of mixed premises is met. The complex has to be
assessed in its entirety. It is composed of various buildings used wholly
or partly for accommodation, and it is also composed of other buildings
used for purposes other than accommodation such as the restaurant, bar,
clubhouse, leisure centre and the berths at the marina. These facilities
are not generally open to the public. • An experienced valuer would not construe the word "building" as used in the Act in the singular only, but would interpret it in its broadest sense to embrace the whole property. • The facts are fundamentally different from those in the Kerins case cited above. The Kerins case was concerned basically with the letting of holiday homes, whereas this case concerns a large holiday complex where you buy into the package with all the facilities aforementioned. These facilities are linked to the lettings and not separate from them. They are not generally open to the public. In the Kerins case there was the facility of a ballroom but there was no evidence to show that this was confined to the residents only. Findings As regards both properties the same economic principle applies. They were both set up to run a holiday enterprise on a commercial basis whereby guests could come and stay in detached buildings used as dwellings. However, we must examine to see if the legal principle established in the Kerins case, namely that the chalets were held to be "domestic hereditaments" under the previous legislation [the Local Government (Financial Provisions) Act, 1978] and entitled to relief, can also be applied to the cottages in this case under the Valuation Act, 2001. "Domestic premises" within section 3(1) of the Valuation Act,
2001. • The premises either in whole or in part must be used as a dwelling
and We start with the last test and work backwards. The question of an apart-hotel was not an issue in this case. However, the respondent raised the issue that the subject premises is a mixed premises under the 2001 Act. The main submission in this regard is that the Gladstead property has to be taken as a whole business unit from the point of view of valuation and not just the cottages by themselves. The respondent submits that the property meets the criteria for mixed premises within the Act. • Property which consists wholly or partly of a building He submitted that the word building has to be interpreted in the plural.
The business has to be valued as a whole unit and any true valuer would
value the premises as a whole business unit and not just in part. The
reality is that the premises are used for both residential and non-residential
purposes. One should not put a narrow interpretation on the word "building".
Accordingly it is a mixed premises within the meaning of the 2001 Act.
By way of contrast we might refer to a recent Tribunal determination with regard to First Citizen Residential Ltd.-VA04/2/035, which operates as a nursing home. The residential and non-residential aspects of the business were integrated within the one building complex and so the building was evaluated as a whole and held to be a "mixed premises" within the meaning of the Valuation Act, 2001. Again the Kerins case is the main guidance in law in this matter. • Each of the 12 chalets were used for dwelling purposes only and accordingly were not mixed premises and were held to be " domestic hereditaments" as defined by section 1 of the Local Government (Financial Provisions) Act 1978. Similarly in this case the cottages are used for dwelling purposes only and are not mixed premises within the meaning of the Valuation Act. • We appreciate that under section 11 (a) of the Interpretation Act, 1937 every word importing the singular shall, unless the contrary intention appears, be construed as also importing the plural and vice versa. The Tribunal interprets the word building in its literal meaning as singular which appears to be in line with the thinking of Judge Blayney at High Court level when he referred in the Kerins case to "each" of the chalets as a domestic hereditament (page 504 IR 1996). This may be a narrow interpretation but it is the law as it stands. In a similar way we must look to each cottage as a single unit or building to ascertain if each one is a domestic premises. • Whether the holiday complex is open to the general public or not is not a material fact. • Whether the individual buys into a package or not is not material. What is material is whether the cottages are used only as dwellings. • The fact that they are used on a commercial basis is not material. • If the Legislature wanted to rate these types of dwelling units as part of a holiday complex, they could easily have provided for such in the legislation. • Nevertheless it must be said that the Tribunal has a degree of sympathy with the respondent in so far as the subject premises is clearly a commercial enterprise and run solely for the purposes of making a profit and as such should be liable for rates. However in the light of the Kerins case and the lack of guidance in the Valuation Act, 2001 we conclude that the cottages are in fact domestic premises within the meaning of paragraph 6, Schedule 4, of the Valuation Act, 2001 and as such are relevant property not rateable. And the Tribunal so determines. Obiter dictum |