The High Court has ruled that the Valuation Tribunal applied the wrong legal test when it found an NCBI Retail charity shop in Virginia, Co Cavan, to be rateable. The court’s decision answered a question of law referred by the Tribunal; it did not set out a final order on the property’s valuation or rates liability.
The case concerned NCBI Retail’s shop at 6/2 Oldcastle Road. The Tribunal had dismissed the company’s appeal against the Commissioner of Valuation’s decision to include the property in the Valuation List at a net annual value of €7,170. The floor area and valuation were not disputed.
NCBI Retail argued that the shop’s retail activity was used to raise money for the charitable work of its parent, the National Council for the Blind of Ireland Group. Its constitution states that profits from retail activity support the parent group’s charitable objects, and bars distributions of company income or property to members. The evidence before the Tribunal was that funds from the Virginia shop supported services for blind and vision-impaired people, including children and adults in border areas.
The Commissioner argued that selling donated goods to raise funds benefited the charity indirectly and did not amount to using the property for charitable purposes. The Tribunal accepted that the shop was used solely for retail fundraising but concluded that the activity was not sufficiently connected to the charity’s main objects. It also relied on earlier Tribunal decisions drawing on the English Oxfam case.
Justice Siobhán Phelan held that the Tribunal had focused on what the property was used as, rather than why the charity used it. Under the Irish High Court authority in St Vincent’s Healthcare, she said, the relevant test requires consideration of both the activity in the property and the occupier’s purpose in carrying it on. She found that the Tribunal had also failed to properly consider NCBI Retail’s own stated object: generating profits through retail to support its parent’s charitable work.
The judge answered “No” to the Tribunal’s question: it was incorrect in law to interpret paragraph 16(a) of Schedule 4 to the Valuation Act 2001 as making the property rateable. She said the parties would be heard on the appropriate order under section 39(5) of the Act. The judgment therefore resolved the legal question referred, while leaving the form of the resulting order for a further step.