Appeal No. VA95/2/001
AN BINSE LUACHÁLA Joseph Rickard, Pierhouse Limited APPELLANT RE: Licensed shop at 27, Harbour Road, Howth, D.E.D.
Howth, R.D. Dublin - Fingal, Co. Dublin B E F O R E JUDGMENT OF THE VALUATION TRIBUNAL By Notice of Appeal dated the 17th day of May 1995 the appellant appealed against the determination of the Commissioner of Valuation in fixing a rateable valuation of £300 on the above described hereditament. The grounds of appeal as set out in the Notice of Appeal are that:- "it is excessive." The Property: Ground floor: Bar, pool room, various stores and gents toilets. First floor: Lounge, ladies and gents toilets and an office. Valuation History: Written Submissions: In his written submission, Mr. Breslin gave a description of the subject premises and its location. Mr. Breslin did not give an estimate of rateable valuation in the written submission, but said that the subject premises was considerably disadvantaged in terms of its location and in terms of the nature of the buildings. He submitted trading figures, certified by John McElhinny, Accountant, clearly showing that expenditure in 1990 had had little effect on turnover. In support of his proposal that the rateable valuation was too high on the subject premises Mr. Breslin adduced one comparison, namely, Waterside Licensed Premises, Harbour Road, Howth, revised 2/5/95 with a rateable valuation of £270. The Tribunal also received copies of the Annual Report and accounts of the Pierhouse Limited for the years ending December '89, '90 and '91. A written submission was also received by the Tribunal on 29th day of February 1996 from Mr. John McElhinny of Messrs. John McElhinny & Company, Chartered Accounts, entitled "Estimation of NAV", analysing the accounts as a basis for the calculation of NAV. A written submission was received on the 21st day of February 1996 from Mr. Tom O'Flynn, B.Agr.Sc, MIAVI, Grad. Dip (P .+ D. Econ), a Valuer with 15 years experience in the Valuation Office on behalf of the respondent. In the written submission, Mr. O'Flynn set out the grounds of appeal, a description of the subject premises and its valuation history. He set out his calculation of rateable valuation on the subject premises on the accounts method as follows:- Average nett turnover less cost of entertainment - £478,420 (based
on turnover for years ending '89, '90 and '91). In support of his estimate of net annual value, Mr. O'Flynn offered three comparisons. 1. The Elphin, Baldoyle Road, Sutton 2. Bayside Inn, Bayside, Sutton 3. Baldoyle House, Main Street, Baldoyle Oral Hearing: Mr. Breslin referred to his written submission and pointed out that there were in all sixteen licensed premises in Howth and that the subject was at the end of the line. He submitted that the property was not a purpose built licensed premises and therefore had restrictions in terms of layout and space and that it needed constant maintenance because of its exposed location on the sea front. Referring to Mr. O'Flynn's comparisons, Mr. Breslin submitted that the Elphin and the Bayside Inn were not comparable in terms of location, size or condition. Referring particularly to Baldoyle House, Mr. Breslin emphasised that while it was approximately two and a half times the size of the subject and located in the centre of the suburb of Baldoyle, its rateable valuation was only £340 as compared to the rateable valuation of £300 on the subject. Mr. Joseph Rickard gave evidence that his property was the only union house in Howth and as a result that wages, costs and holiday entitlements were higher than those of his competitors. He said that the upstairs lounge was costly to staff but that it was considered necessary in order to hold on to trade as was the music at weekends. Mr. John McElhinny provided the Tribunal with certified accounts and a useful explanatory memorandum in relation to same. These have been considered by the Tribunal but as is customary are not appended hereto. Mr. McElhinny submitted that a potential tenant would take into account
the fact that the property is at present a family business, and that there
is a relatively small differential in pay between bar personnel. He pointed
out that the profitability of the upstairs lounge would be taken into
account also. In his view the upstairs lounge may in fact only be breaking
even. Mr. O'Flynn submitted that he did not wish to add to his written submission. He assisted the Tribunal and Mr. Breslin by producing details of floor areas and turnover figures for the premises known as the Waterside in Howth, put forward by Mr. Breslin as being the nearest suitable comparison. Mr. O'Flynn confirmed that the total floor area of the ground floor of the Waterside and Evora premises which together form one rateable hereditament was 2,665 square feet. He submitted that his estimate of turnover of the Waterside as of November 1988 was in the region of £495,092 giving a rateable valuation of £270. Replying to a question from Mr. Breslin in relation to Baldoyle House, Mr. O'Flynn gave evidence that the rateable valuation of £340 on that property was based on turnover figures of £600,000 giving a net annual value based on a 9% yield of £54,015 and a rateable valuation of £340. Determination: In the absence of comparative letting values it has become customary among the valuers to base their estimate of rateable valuations of licensed premises on turnover figures. Turnover figures alone are not sufficient. Other factors too, such as location, potential and physical layout must also be considered. Market value does not relate solely to turnover. The subject property is somewhat disadvantaged in terms of location and this in turn affects its potential. In the circumstances and in light of all of the evidence, including the comparative evidence adduced, the Tribunal determines that the correct rateable valuation of the subject hereditament is £250.
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