AN BINSE LUACHÁLA
VALUATION TRIBUNAL
AN tACHT LUACHÁLA, 1988
VALUATION ACT, 1988

Kevin Mulholland APPELLANT
and
Commissioner of Valuation RESPONDENT

RE: Licensed House Stores and Small Garden, at Lot No. 66/18,
Townland of Castlebellingham, E.D. Castlebellingham, District of Louth, Co. Louth
Quantum - Direction on Comparisons

B E F O R E
Henry Abbott S.C. Chairman
Padraig Connellan Solicitor
Veronica Gates Barrister

JUDGMENT OF THE VALUATION TRIBUNAL
ISSUED ON THE 11TH DAY OF JUNE, 1993

By Notice of Appeal dated the 7th May, 1992, the appellant appealed against the determination of the Commissioner of Valuation in fixing a rateable valuation of £65 on the above described hereditament.

The grounds of appeal as set out in the Notice of Appeal are that:-
"the valuation is excessive and inequitable".

The Property
The property comprises a public house with living accommodation consisting of bar, lounge, toilets, store and living quarters, bedrooms, sitting room, kitchen, W.C. and shower.

The agreed areas are as follows:-
Bar 445 sq.ft.
Lounge 368 sq.ft.
Ancillary 376 sq.ft.
Store (External) 618 sq.ft.
Living Quarters 2,012 sq.ft.

The property is situated in the Village of Castlebellingham overlooking the green with on-street parking.

Valuation History
The property was listed for revision in 1990 by Louth County Council. The rateable valuation was increased from £18 to £65 and the description changed from "Licensed House, Shop, Offices and Small Garden" to "Licensed House, Stores and Small Garden". At 1990 First Appeal the R.V. was unchanged by the Commissioner of Valuation and it is against this determination that the appeal now lies to the Tribunal.

Written Submissions
A written submission was received on the 28th October, 1992 from Mr. Desmond Killen F.R.I.C.S. I.R.R.V. on behalf of the appellant. In the written submission, Mr. Killen described the property, its location, accommodation, construction and services and set out the valuation history attaching to it.

Mr. Killen stated that there were a number of methods of calculating rateable valuation:-
(1) Estimate of N.A.V. from direct evidence.
(2) Estimate of N.A.V. from estimate of an Annual Return on Purchase Price and Expenditure on premises.
(3) Estimate of N.A.V. from Accounts.
(4) N.A.V. over R.V. from comparable valuations on similar types of premises.

Mr. Killen said that in relation to Method (1) he was unaware of any direct evidence of Rental Value on the licensed premises. In relation to Method (2) the N.A.V. as return on Purchase Price and Capital Expenditure, he said that the subject was purchased in 1987 for £125,000 and expenditure on roof repair and insulation was £3,500, that is, £128,500 in total. He submitted that the correct figure for the return on capital employed for licensed premises was 7 to 8% and on this basis the N.A.V. for the subject hereditament is £9,000 to £10,280 yielding a rateable valuation of £45 to £50.

In relation to Method (3) Mr. Killen stated that the witness had prepared an assessment based on the accounts for years ending 31st October, 1990 and 31st October, 1989.

Deducting bank interest charges, leasing, depreciation and rates from overhead
expenses the working profit is £12,189.

Working Profit is £12,189
Deduct Tenant's share (say) 50% = £6,094
Amount available for Rent (NAV) & Rates (RV X £20.80) £6,095

Viz. N.A.V. + N.A.V ÷ 200 + 20.8 = £6,100

1.104 X N.A.V. = £6,100
N.A.V. = £5,525
R.V. @ 0.5% = £27.60
Add for Domestic element = £13.00
Total R.V. = £40.60
(say) £41

Finally, in relation to Method (4) comparisons, Mr. Killen gave examples of "Licensed Premises" in the town of Castlebellingham as follows:-

V.O. Lot Occupier Description R.V.
(Bldgs)
(a) 67, 68,69 Thos. Conlon Licd Ho., Shop Offices & Land £70

(b) In 111 Thos. Heaney Licd Shop, Offs & garden£45

(c) 112 Patrick Byrne Licd Ho, Offs & Yard£12.75

(d) 27abc John J Reena Licd Hotel & Land £300

There are two other licensed premises within E.D. Castlebellingham

Twd. Milestown
(e) 4Aa.5 Thos. McGeary Licd House, Offs & Land£85

Twd. Mullincross
(f) 28a John Dorian Licd House, Shop, Offs & Land£27

Mr. Killen estimated the appropriate valuation for the subject premises as follows:-

Rateable Valuation:
Bar 368]
Lounge 445] 813 sq.ft. @ 3.5p = £28.45 Say £28
Dwelling 1,965 sq.ft. @ 0.5p = £9.85]
Store 624 sq.ft. @ 0.5p = £3.12] Say £13
£41

In the alternative, the N.A.V. is calculated:
Bar/Lounge: 813 @ £7 = £5,691
Dwelling: 1,965 @ £1 = £1,965
Store: 624 @ £1 = £ 624
N.A.V. = £8,280
R.V. @ 0.5% = £43

and concluded from the above that the correct rateable valuation was between £40 and £45.

A written submission was received on the 2nd November, 1992 from Mr. Patrick Mc Morrow a Valuer on behalf of the respondent. In the written submission, Mr. Mc Morrow described the premises and set out the recent valuation history. Commenting on the grounds of appeal, Mr. Mc Morrow, stated, that although there had been negotiations around a figure of £50 at First Appeal the Commissioner of Valuation had not accepted this figure and no change had been made to the rateable valuation at First Appeal.

Mr. Mc Morrow said that in calculating the rateable valuation on the subject premises he had calculated it in accordance with Section 5 of the 1986 Valuation Act as follows, Net Annual Value by a fraction derived from the Rateable Valuation over the Net Annual Value. He said that in the absence of direct rental evidence the N.A.V. is calculated by reference to other recently revised licensed premises and N.A.V.'s fixed at Valuation Tribunal. Mr. Mc Morrow set out details of comparative evidence as follows:-

Table 1

Table 2

Table 3

Mr. Mc Morrow concluded by setting out his calculation of the Rateable Valuation on the subject premises as follows:-

Calculation of N.A.V.
Method (1) N.A.V. as % of Turnover.

Non-Domestic: Average Turnover £90,849 @ 11½% = £10,447
Domestic: £50 pw X 52 = £ 2,600
£13,047

Method (2) N.A.V. as a % of Capital Value N.A.V. £13,000
Capital Value £130,000* @ 10% = £13,000
*Note Purchase Price 1987 £125,000

Basis of R.V.
N.A.V. X R.V./N.A.V. (Fraction) = R.V.
£13,000 X 0.5% = £65.00
R.V. £65.00

Oral Hearing
The oral hearing took place in Dublin on the 27th day of January, 1993.. The appellant was represented by Mr. Desmond Killen F.R.I.C.S. I.R.R.V. of Donal O'Buachalla & Company Limited and the respondent was represented by Mr. Patrick Mc Morrow a Valuer in the Valuation Office. Both Valuers debated the estimate of N.A.V. for the premises along the lines of their precis and it emerged from this debate that the subject was not directly comparable to any of the licensed premises in the neighbouring towns. Neither was it to be likened to a premises which had established a physical dominance upon the main road. The Tribunal finds that it has been helped considerably by the accounts which were submitted by the appellant but considers that the premises may have somewhat more potential than is reflected therein. However, a prospective tenant of the premises could not be certain of establishing a booming type of road-house trade. Having regard to the foregoing considerations and all the evidence offered the Tribunal finds that the valuation of the subject is £52.