Port of Cork Company v Commissioner of Valuation

• Jurisdiction: Ireland
• Judge: Keane C.J.
• Judgment Date: 28 July 2003
• Neutral Citation: [2003] IESC 47
• Court: Supreme Court
• Date: 28 July 2003

[2003] IESC 47

THE SUPREME COURT

Keane C.J.

Denham J.

Murray J.

M^cGuinness J.

Hardiman J.

136/03

PORT OF CORK CO v. COMMISSIONER OF VALUATION

BETWEEN

PORT OF CORK COMPANY

APPELLANT/RESPONDENT

AND

THE COMMISSIONER OF VALUATION

RESPONDENT/APPELLANT

Citations:

HARBOURS ACT 1996 s7

BELFAST HARBOUR CMSR V CMSR OF VALUATION 1897 2 IR 516

CMSR OF VALUATION V SLIGO HARBOUR CMSR 1899 2 IR 214

VALUATION ACT 2001

GUARDIANS OF LONDONDERRY UNION V LONDONDERRY BRIDGE CMSR IR 2 CL 577

POOR RELIEF (IRL) ACT 1838 S63

VALUATION ACT 1854 S2

MCGAHAN & RYAN V CMSR OF VALUATION 1934 IR 736

JONES & ORS V MERSEY DOCKS & HARBOUR BOARD 11 HL 443

MAYOR OF LIMERICK V CMSR OF VALUATION IR 6 CL 420

KERRY CO COUNCIL V CMSR OF VALUATION 1934 IR 527

TRINITY COLLEGE V CMSR OF VALUATION 1919 2 IR 493

HARBOURS ACT 1996 S8(3)

HARBOURS ACT 1996 S11(1)

HARBOURS ACT S12(1)

HARBOURS ACT S17(2)

HARBOURS ACT S18

HARBOURS ACT S19

HARBOURS ACT S22

HARBOURS ACT S29

COMPANIES ACT 1963

COMPANIES ACT 1983

COMPANIES ACT 1990

POSTAL & TELECOMMUNICATIONS ACT 1983

FORESTRY ACT 1988

IRISH AIR AVIATION AUTHORITY ACT 1993

AIR NAVIGATION & TRANSPORT ACT 1988

ORDNANCE SURVEY ACT 2001

HARBOURS ACT 1996 S88

INSPECTOR OF TAXES V KIERNAN 1981 IR 117

Synopsis:

RATES

Valuation

Valuation Tribunal - Whether port company exempt from rates - Whether activities of appellant carried out for benefit of public - Harbours Act, 1996 (136/2003 - Supreme Court - 28/7/2003)

Port of Cork v Commissioner of Valuation - [2003] 3 IR 272 - [2004] 1 ILRM 151

the respondents contended that the effect of the transfer of ownership of the port of Cork from the Cork Harbour Commissioners to the appellant private company established under section 7 of the Harbours Act 1996 was that the property in question was thereafter rateable, which contention the appellants disputed. That dispute was resolved in favour of the appellants in the High Court which allowed the appellant’s appeal from the decision of the Valuation Tribunal. The respondent appealed that decision to the Supreme Court, asserting that public utility was not the only touchstone by reference to which exemption from rateability was ascertained in Ireland. They argued that the clear intention of the legislature was that newly commercialised companies such as the respondents were to act in a commercial fashion which would involve their paying rates.

Held by the Court in dismissing the appeal that in Ireland exemption form rateability for operators of ports depended firstly, on the fact that the harbour was open to all members of the public on payment of the appropriate dues and secondly, that the Commissioners were a body established and governed by statute, the functions of which were essentially public in nature. Accordingly, there was no basis for holding that the exemption afforded by law to the Commissioners was no longer available to the company established under the Act of 1996. Neither was it the function of the courts to remedy an omission in the Act of 1996 to make any provision for rateability in respect of companies such as the appellant formed under that legislation and similar companies formed under comparable legislation, particularly when such legislation imposed a fiscal liability.

Keane C.J.

1 At issue in this appeal is the question as to whether the appellant/respondent (hereafter "the respondent") is exempt from rateability in respect of its occupation of Cork Harbour. It was resolved in favour of the respondent in the High Court which allowed an appeal from the decision of the Valuation Tribunal. The respondent/appellant (hereafter "the appellant") has now appealed to this court from the judgment of the High Court (Kearns J.).

2 Prior to the enactment of the Harbours Act, 1996, the owners and occupiers of the Port of Cork were the Cork Harbour Commissioners (hereafter "the Commissioners"), a body established under a series of private Acts. It was acknowledged on behalf of the appellant that the Commissioners were exempt from rateability in respect of their occupation of the Port of Cork by virtue of two decisions of long standing,Belfast Harbour Commissioners -v- Commissioner of Valuation [1897] 2 IR 516 and Commissioner of Valuation -v- Sligo Harbour Commissioners [1899] 2 IR214. It was submitted on behalf of the appellant however, that the changes introduced by the 1996 Act which provided for the formation of the respondent as a private company under the provisions of the Companies Acts were of such a nature as to deprive the respondent of the exemption from rateability formerly enjoyed by the Commissioners. The parties were agreed that, with the coming into force of the Valuation Act, 2001, the exemption (if it existed) came to an end.

3 It had been the law in Ireland since the decision of the Court of Exchequer Chamber inGuardians of Londonderry Union -v- Londonderry Bridge Commissioners [IR 2 CL 577] that exemption from rateability is to be ascertained by reference to the proviso to s. 63 of the Poor Relief (Ireland) Act, 1838 (hereafter "the 1838 Act"). That proviso was in the following terms:

"Provided also, that no church, chapel, or other building exclusively dedicated to religious worship, or exclusively used for the education of the poor, nor any burial ground or cemetery, nor any infirmary, hospital, charity school, or other building used exclusively for charitable purposes, nor any building, land or hereditament dedicated to or used for public purposes, shall be rateable, except where any private profit or use shall be directly derived therefrom, in which case the person deriving such profit or use shall be liable to be rated as an occupier according to the annual value of such profit or use." (Emphasis added)

4 Section 2 of the Valuation Act, 1854 required the Commissioner of Valuation in making out the lists or tables of valuation to distinguish all hereditaments and tenements "of a public nature". All such hereditaments or tenements were to be deemed exempt from rateability

"so long as they continued to be of a public nature, and occupied for the public service."

5 In theLondonderry Bridge case, O'Hagan J. said that the introduction of the words "and occupied for the public service" could not affect or abridge what he described as "the clear relief from rateability" under the proviso to s. 63 of the 1838 Act. That view of the law was challenged in M^cGahan & Ryan -v- Commissioner of Valuation [1934] IR736, but the Supreme Court of Saorstat Eireann held that the decision in the Londonderry Bridge case could not be departed from at that stage. Nor has it been challenged in the present proceedings.

6 TheLondonderry Bridge case is also the authority which was relied on in both the Belfast Harbour case and the Sligo Harbour case for the holding in each case that the occupation by the Harbour Commissioners of the particular harbour was exempt from rateability.

7 It had been held by the House of Lords in England inJones & Ors -v- Mersey Docks and Harbour Board [11 HL 443] that property capable of yielding a pecuniary profit to the occupier was rateable, even though the occupation of the property conferred a benefit on the public and did not result in any private profit to the occupier. The only exception was property in the occupation of the Crown and its servants, which exemption was derived, not from the actual language of the relevant statute of Elizabeth 1, but from the principle that the Crown, not having been named in the statute, could not under English law be regarded as affected by its provisions.

8 In theLondonderry Bridge case, however, a majority of the judges in the Exchequer Chamber reversed the unanimous decision of the Queens Bench Division in the same case and concluded that the Mersey Docks case was not applicable in Ireland, because of the different wording of the proviso to s. 63 of the 1838 Act, specifically the words "dedicated to or used for public purposes".

9 The hereditament sought to be rated in theLondonderry Bridge case was not the bridge itself, but the tolls charged to persons using the bridge. The Commissioners, in whom the bridge was vested, were obliged by their private Act to apply the tollsinter alia in maintenance of an existing bridge until the completion of the new structure, then in discharge of the annual interest of the money borrowed on mortgage of the tolls, next, in forming a sinking fund for repaying that money and, finally in defraying the annual expenses of the bridge so that it might become toll free. In the view of the majority, the result was that the tolls were"dedicated to public purposes" was in the meaning of the Act of 1838.

10 The result was that Irish law in this area diverged sharply from English law: under the latter only property in the actual occupation of the government or its servants was entitled to exemption from rateability. The decision was unquestionably one which occasioned considerable controversy at the time. In subsequent decisions, it was held not to be applicable where the property was for the benefit of a limited category of the public — as in the case of local authority property — as distinct from the public generally: see Mayor of Limerick -v- Commissioner of Valuation ( IR 6 CL 420);Kerry County Council -v- Commissioner of Valuation [1934] IR 527.

11 Although, in the case of a university, any member of the public might be entitled to be admitted as a student on payment of the appropriate fees, whether that was sufficient to entitle it to exemption from rateability depended on whether the charter or statute from which it derived its existence could be regarded, in broad terms, as private or public in its general character. Applying...