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Appeal No. VA90/3/069 AN BINSE LUACHÁLA Telecom Eireann APPELLANT RE: "Right to install and operate pay phones"
at Map Reference "R 1" at B E F O R E JUDGMENT OF THE VALUATION TRIBUNAL By notice of appeal dated 28 September, 1990, the appellants appealed against the determination of the Commissioner of Valuation in fixing a rateable valuation of £32.00 on the above. In the Notice of Appeal form under the heading description of hereditament the appellant stated that "The appellant is not seized in law or in equity of any hereditament. The location of the apparatus (consisting of public telephone equipment) is at the St Stephen's Green Shopping Centre which is not owned or occupied by the appellant and in which the appellant has no interest". The grounds of appeal as set out in the Notice of Appeal are as follows;- (1) The appellant does not have exclusive occupation of any site on which the apparatus may be situated. (2) That the apparatus is situated at the site exclusively at the will of and subject to the direction of the occupier of the site. This situation may be at any time determined in circumstances which give the appellant no right, either in law or in equity, to challenge that determination or to seek damages in respect of it or to seek relief against forfeiture. (3) That there is no occupation of any kind by the appellant of any portion of the St Stephen's Green Shopping Centre. (4) That there is no exclusive occupation of any kind over the St. Stephen's Green Shopping Centre. (5) That the St Stephen's Green Shopping Centre has already been assessed for rates on a basis which included the entirety of the Centre which is thus in the exclusive occupation of the appropriate rated party in that regard. (6) That any assessment for rates in respect of the apparatus would amount to a double assessment. (7) If the apparatus is to be assessed as machinery then same is not assessable for rates because it does not produce motor power. (8) The apparatus does not comprise a rateable entity. (9) If (which is denied) there is any occupation of the site of the apparatus on the wall of the said Centre which is not inclusive to the occupation of the Centre by the appropriate rated party then the said occupation is in the public using the Centre and the apparatus is installed for the convenience of the public and is thus exempt. (10) That the Commissioner of Valuation erred in law and in fact in including in the apparatus he was proporting to assess the fixtures and fittings surrounding the said apparatus. (11) That the Commissioner of Valuation erred in law and in fact in considering that the fixtures and fittings in the vicinity of the said apparatus was the property of Telecom Eireann or was installed by Telecom Eireann or were fixtures and fittings in respect of which Telecom Eireann had any right of any kind. (12) That the assessment is wrong in law in failing to comply with the provisions of Section 5 of the Valuation Act, 1986. Valuation History The telephone kiosks were valued and entered in the valuation lists as
follows;-
The valuation was appealed to the Commissioner of Valuation. Having considered the report of the Appeal Valuer the Commissioner altered the entry in the valuation lists as follows;-
It is against this rateable valuation that the appeal now lies with the Tribunal. Written Submissions With regard to the rateability of the hereditament Mr Cooney said that
there are two questions which have to be addressed viz With regard to rateable occupation Mr Cooney refers to page 283 on "The
Law of Local Government in Ireland" and said that Mr Justice Keane
in this book deals with the question of rateable occupation and identified
three essential ingredients of rateable occupation;- Mr Cooney refers to a valuation textbook "Rating and Valuation in
Northern Ireland" by James Kay and A.L. Jacobson, on the subject
of exclusive occupation. He refers also to the twelfth Mr Cooney said that Telecom Eireann are in beneficial occupation of an
incorporeal hereditament. He said that Telecom Eireann have the "exclusive
right" to the revenue generated by pay phones and that this "right"
is of some value. He said that the fact that they do not pay a fee or
rent for the easement does not mean that there is no value or benefit
from their occupation. Mr Cooney said that a purely transient or temporary
holding of land is not rateable but provided it does not fall within this
category, it is not material that the occupation may be for a fixed term
which is due to expire shortly or may be terminable on notice at any time.
He said that it is his contention that Telecom Eireann are the rateable
occupiers of a rateable hereditament (incorporeal). Agreed Current Market Rent £626,950 p.a. Analysis: Ground Floor Offices 4,090 sq ft @ £ 17.00 N.A.V. of Pay Phone Lobby: 755 sq ft @ £17.00 per sq ft. = £12,835 He then attributed this value on a proportion basis to the phones in
the subject hereditament to arrive at a N.A.V. as follows;- Ground Floor 4 sites @ £916 = £3,664 He then calculated the rateable valuation as follows;-
Mr Cooney provided the basis for the proportion between rateable valuation and N.A.V. as follows;- BASIS FOR R.V./N.A.V. RATIO: Standard pay phones on St. Stephen's Green have been valued at R.V. £5 per pay phone. Estimated N.A.V. per pay phone £916 R.V./N.A.V. Ratio = £5/£916 = 0.55% Using a direct comparison basis Mr Cooney calculated the rateable valuation as follows;- RATEABLE VALUATION by DIRECT COMPARISON Telephone kiosks on St. Stephen's Green have been valued in the period 1986 to 1990 Revisions at £5 per kiosk. (See schedule of Comparisons) Ground Floor 4 sites @ £5/site = £20 Mr Cooney then supplied six comparisons of telephone kiosks all of which have been revised since 1986 and each of which are valued at a rateable valuation of £5 per kiosk. The details of these comparables are attached at Appendix A. A written submission was received on behalf of the appellants on the 7th February, 1991 from Ms Ann Donnelly, an Apprentice Solicitor employed by Telecom Eireann at 52 Harcourt Street, Dublin 2. In this submission Ms Donnelly said that she is satisfied that Telecom Eireann have no rights in respect of the pay phones in the St Stephen's Green Centre other than the fact that they are owned by Telecom Eireann. She said that under Section 87 of the Postal and Telecommunications Services Act, 1983, Telecom Eireann's monopoly extends only to the provision of Telecommunications Services. She said that this monopoly does not extend to telecommunications customer equipment. The provision of telecommunications customer equipment is regulated by the Minister for Communications under Section III of the Postal and Telecommunications Services Act 1983. Ms Donnelly said that to date the Minister for Communications has licensed in or about three hundred and forty one individuals or companies to provide telecommunications customer equipment, which would include customer payphones. Ms Donnelly attached the details of the licensees. She said that in the light of the foregoing Telecom Eireann has no "exclusive rights" in respect of the provision of pay phones in the St Stephen's Green Centre or indeed at any location. She said that this was borne out by the fact that in a number of locations throughout Dublin including Nutgrove Shopping Centre, Northside Shopping Centre and Roches Stores, Telecom Eireann payphones were returned and replaced by privately rented models. Ms Donnelly said that Telecom Eireann has no lease or similar agreement or arrangement in respect of the provision of pay phones in the St Stephen's Green Centre and as such would be obliged to conform to any request of the Developers or their agents to remove the payphones. She said that this request can be made at any time and is subject to no contractual limitation such as notice. She said that Telecom Eireann therefore has its pay phones on the wall of the centre at the sufferance of the Centre owners. A written submission was received on the 7th of February, 1991 from Mr
Dan Curtin of Jones Lang Wootton, Surveyors and International Real Estate
Consultants, and Management Agents for the St Stephen's Green Centre.
Mr Curtin said he has been employed since January, 1988 as Property Manager
of the St Stephen's Green Centre. He said that his duties include the
day to day running of the Centre, hiring of security staff, appointment
of local management, leasing arrangements and all other aspects of management
of the Centre. Mr Curtin said that the Centre has in or about ninety five
units leased to a variety of tenants most of whom have taken a thirty-five
year lease from Firmount Limited. He attached a specimen of the lease.
Mr Curtin confirmed that Telecom Eireann has no such lease or any similar
agreement or arrangement with Firmount Limited or with their Management
Agents and he said it has no easement, or license or any right to enter
those premises. He said that entry to the Centre is always made with permission
and this permission can be revoked at any time. Mr Curtin then outlined
how the arrangement whereby Telecom Eireann have telephones installed
in the Centre came about. He said that on the 20th July, 1988 Ms Ann Delaney,
(the then Manager of the Centre and the employee of Jones Lang Wootton)
requested Telecom Eireann to install twelve pay phones in the St Stephen's
Green Centre at locations to be discussed with the Centre's Architects.
He said that neither Firmount Limited nor its Management Agents nor any
other person is in receipt of any payment or fee in respect of what is
in effect a permission to install these pay phones. He said the pay phones
were provided for the convenience of the shopping public as one of the
facilities of the Centre on the same basis as the lifts, elevators and
the toilets. Mr Curtin said that at any stage his firm could ask Telecom
Eireann to remove the pay phones and if they choose to have them replaced
with instruments of a rival firm. A further written submission was received on 7th February, 1991 from Mr Eugene O'Neill a telecommunications Technician employed by Telecom Eireann as a fitter. He said that in or about August 1988 he received twelve Advice Notes from Telecom Eireann Contracts Section to provide the twelve public pay phones in the St Stephen's Green Centre. He said that he was instructed to install the pay phones at the locations indicated in the drawings. He said that he had no discretion as to the location of the said pay phones and that each pay phone was to be installed in the middle of the pre-existing wooden booth which was supplied and put in place by the Developers of the Centre. He said that each telephone instrument hangs on the wall and there is no portion of ground reserved or marked out for people using the pay phones. He said that the pay phones are located in a pedestrian passageway over which Telecom Eireann does not have any exclusive occupation. Mr Eugene O'Neill attached photographs to illustrate the nature of the installation in question and the absence of any reserved enclosure or exclusive occupation of floor space. Mr O'Neill said that each telephone instrument occupies no more than three square feet of wall space and protrudes no more than six inches from the wall at any point. Oral Hearing Mr Charleton said that this appeal concerned a piece of telephone equipment
which was mounted on the walls in common areas in St Stephen's Green Shopping
Centre. He said that Telecom Eireann were requested and installed a number
of pay phones in the centre and that no rent was passing between the two
parties in respect of these. He said that there is no occupation by Telecom
Eireann which could in any terms be regarded as occupation under the 1838
Act. He said that in order to be liable for rates one must be in occupation
of a hereditament. He said that a hereditament is described in Stroud,
4th Edition at page 1231 as something that is capable of being inherited.
He said that under no circumstances could this be considered a profit
a prendre under the relevant Section of the 1838 Poor Relief, Ireland
Act. Mr Paddy O'Neill gave evidence that the phones were not in a recessed location and that the decision on the location of the phones were that of the architects of the centre rather than that of Telecom Eireann. Ms Anne Donnelly gave evidence as outlined in her precis of evidence
and gave details of correspondence contained therein between the owners
of the centre and Telecom Eireann. Ms Donnelly said that Telecom Eireann
put these phones in at the request of the agents of the owners of the
centre and they could be required to remove them at any time. She said
that the only rights that Telecom Eireann had is that they own the phones.
She said that the only thing that Telecom Eireann owns is the instrument
and the cash box at the end of it. She said that if requested Telecom
Eireann would have to proceed immediately to remove the boxes. She said
that with regard to collection that Telecom Eireann enter the centre with
the permission of the management and empty the coin boxes three to four
times a week. She said that Telecom Eireann has lost its monopoly to provide
customer telephone equipment. She said that up to 350 people have been
licensed to sell communications equipment and that Telecom Eireann has
now to compete with these people for the provision of such equipment.
She said that in a number of other shopping centres the management has
installed their own phones and pay Telecom Eireann the 11.7p in respect
of each call but take the profit in respect of the amount charged per
call. In defining profit a prendre he quoted a definition from Wiley's Land Law at page 333 paragraph 6.034 "A profit a prendre as the name implies is the right to take something from another person's land. The general rule is that the something must be part of the land itself eg. minerals or turf or creatures living naturally on the land which when taken are capable of being owned eg. wild game or fish." He said the definition in McGarry and Wade at page 850 is "a right to take something off another person's land. This is it but not all such rights are profit. If the right is to be a profit the thing taken must be either part of the land eg. minerals or crops or the wild animals existing on it and the thing taken must at the time of taking it be susceptible to ownership. The right to hawk, hunt, fish and fowl may thus exist as a profit for this gives the right to take creatures living on the soil which when killed are capable of being owned, but the right to take water from a spring or a pump or a right to water cattle at a pond may be an easement but cannot be a profit". As regards the question of occupation he said that Telecom Eireann do not have occupation of the property. He referred to Keane's book at page 283 and the four tests involved. These are: 1. there must be actual occupation; 2. the occupation must be exclusive; 3. the occupation must be of value or benefit to the occupier and 4. the occupation must not be for too transient a period. He said he was concerned with the argument of actual occupation and its being exclusive. He said actual occupation is the right to exclude other persons from the use of the hereditament in question. He said that in these circumstances the instrument is there for the use of everybody and everybody is using it. Secondly he said that one cannot occupy a telephone instrument. He quoted from Carroll v. Mayo County Council at p. 364 IR 1967 and said as a result of that, that the only person that could be said to be occupying the hereditament is the public or the owner of the shopping centre. As a final submission he said rates apply to land and that income tax applies to situations such as this. He said if Telecom Eireann is making a profit as a result of having these telephones it is subject to the taxation system not the rating system. Under cross-examination from Mr O'Caoimh, Ms Donnelly agreed that the landlord had accorded Telecom Eireann the right to put the phones in St Stephen's Green Shopping Centre. She confirmed that the landlord was not paying any rental on the lines in the subject premises and that the landlord in the Nutgrove Shopping Centre was paying rental on the lines. Mr O'Caoimh said that part of the argument in the Roadstone case turned on whether the hereditament in question was subject to annual revision at all. As land is not subject to annual assessment or variation which gave rise to the Supreme Court judgment in the Brennan case, he said that the Supreme Court decided that the Roadstone case was rateable under provisions of section 4 of the 1854 Act, which he said relates to property, the valuation of which is subject to frequent alteration. He said that what had been valued in this case by the Commissioner is a right over land. He said that it is not the case that it is the apparatus that is valued as set out in the grounds of appeal. He said that it is the right over land, the right to place one's apparatus here which is being valued. Mr O'Caoimh said that one has to first decide whether there is a rateable hereditament and secondly, if there is such a rateable hereditament, the nature of the occupier. He said that whatever about the rights of the landlord to come and tell Telecom Eireann to remove their equipment from the centre that Telecom Eireann had been in occupation for two years now and Judge Henchy in the Carroll case said that there was such a withdrawal from occupation that the court held that there was occupation. He referred to the reference of the Westminster case at page 366 in Carroll v. Mayo County Council where it refers to the fact of occupation. He said that although there was no formal licence or contract when one looks at the facts and the period of occupation that one sees that there has been a licence exercised here for a period of time. Mr O'Caoimh referred to a former judgment of the Tribunal on Ashfield Holdings concerning a car park. In referring to the four points in Mr Justice Keane's book he said that the first point relates only to English law and that the final point was conceded by the appellants. Mr. O'Caoimh said that it has not ever been suggested that these phones are not of benefit to Telecom Eireann. He said that the only point outstanding was whether occupation is exclusive. Mr. O'Caoimh said that exclusive in this sense means that a person using the hereditament can prevent any other person from using it in the same way. He said that the occupation by Telecom Eireann in this instance is wholly different than the use by the general public. He said that the prevention of any other person using it in the same way depends entirely on the relationship between Telecom Eireann and the landlord in this case. He said that it is the "de facto" occupation rather then the right to occupy that is relevant. He said there had been withdrawal of the owner of the occupation from the portion of the wall in question. As regards Telecom Eireann not having the right to put the phones anywhere he said that if the landlord suggested points with which Telecom Eireann disagreed, they had the right to reject putting the phones there. He said that Telecom Eireann had been accorded a right to place the instruments on specific points on the walls and that that right constituted a rateable hereditament. He said that the occupation fulfils all the criteria set out in Mr. Justice Keane's book and that there is therefore rateable occupation of the hereditament. DETERMINATION
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