NORTHERN IRELAND VALUATION TRIBUNAL

THE RATES (NORTHERN IRELAND) ORDER 1977 (AS AMENDED) AND THE VALUATION TRIBUNAL RULES (NORTHERN IRELAND) 2007

CASE REFERENCE NUMBER: 7/11

STEPHEN & LORRAINE SMITH – APPELLANTS

AND

COMMISSIONER OF VALUATION - RESPONDENT

Northern Ireland Valuation Tribunal

Chairman: Mr John Duffy

Members: Mr Sandy Moore and Ms Noreen Wright

Belfast, 27 October 2011

DECISION

The unanimous decision of the tribunal is that the appeal is allowed and that the Assessed Capital Value of the Property shall be £164,000.

REASONS

Introduction

This is a reference under Article 54 of the Rates (Northern Ireland) Order 1977, as amended (“the 1977 Order”). There was no appearance before the tribunal by or on behalf of the appellant and the respondent, both parties having indicated that each was content to rely upon representations in writing. In accordance with Rule 11 of the Valuation Tribunal Rules (Northern Ireland) 2007, an appeal may be disposed of on the basis of written representations if all the parties have given their consent in writing to that course.

The appellants have appealed against the decision of the Commissioner of Valuation for Northern Ireland (“the Commissioner”) dated 13 May 2011 in respect of the valuation of a hereditament situated at 11, Creevy Otra Road, Armagh BT60 3JP.

The Law

The statutory provisions are to be found in the 1977 Order, as amended by the Rates (Amendment) (Northern Ireland) Order 2006 (“the 2006 Order”). It is perhaps desirable to set out some detail in respect of the statutory provisions applicable to the basis for valuation and the mechanism for appeals to this tribunal in this type of case. Material to the case, Article 8 of the 2006 Order amended Article 39 of the 1977 Order (the basis of valuation) as follows:

“8.
—(1) In Article 39 of the principal Order (basis of valuation), for paragraph (1) there shall be substituted the following paragraphs—

“(1)—.

(1A) For the purposes of this Order the following hereditaments shall be valued upon an estimate of their capital value—

(a) any dwelling-house;

(b) any private garage;

(1B)-.

(1C)-.

(2) In Part I of Schedule 12 to the principal Order (basis of valuation), after paragraph 6 there shall be inserted the following paragraphs—

“Capital value — general rule

7. —(1) Subject to the provisions of this Schedule, for the purposes of this Order the capital value of a hereditament shall be the amount which, on the assumptions mentioned in paragraphs 9 to 15, the hereditament might reasonably have been expected to realise if it had been sold on the open market by a willing seller on the relevant capital valuation date.

(2) In estimating the capital value of a hereditament for the purposes of any revision of a valuation list, regard shall be had to the capital values in that valuation list of comparable hereditaments in the same state and circumstances as the hereditament whose capital value is being revised.

(3) The assumptions mentioned in paragraphs 9 to 15 shall apply for the purposes of determining whether one hereditament is a comparable hereditament in the same state and circumstances as another with the omission of sub-paragraphs (2) and (3) of paragraph 12.

(4) In sub-paragraph (1) “relevant capital valuation date” means 1st January 2005 …..

Capital value — the assumptions

8. In this paragraph and paragraphs 9 to 15—

“development” has the meaning given by Article 2(2) of the Planning Order;
“flat”, in relation to a building, means a dwelling which is a separate set of premises, whether or not on the same floor, divided horizontally from some other part of the building;
“incumbrance” means any incumbrance, whether capable of being removed by the seller or not, except service charges;
“permitted development” means development for which planning permission is not required or for which no application for planning permission is required;
“Planning Order” means the Planning (Northern Ireland) Order 1991 (NI 11);
“planning permission” has the meaning given by Article 2(2) of the Planning Order;
“rentcharge” has the meaning given by section 27(1) of the Ground Rents Act (Northern Ireland) 2001 (c. 5).

9. The sale is with vacant possession.

10. The estate sold is the fee simple absolute or, in the case of a flat, a lease for 99 years at a nominal rent.

11. The hereditament is sold free from any rentcharge or other incumbrance.

12. —(1) The hereditament is in an average state of internal repair and fit out, having regard to the age and character of the hereditament and its locality.
(2) The hereditament is otherwise in the state and circumstances in which it might reasonably be expected to be on the relevant date.

(3) In sub-paragraph (2) “relevant date” means 1st April 2007 or such date as the Department may substitute by order made subject to negative resolution for the purposes of a new capital value list.

13. The hereditament has no development value other than value attributable to permitted development.

14. —(1) A hereditament falling (or deemed to fall) within any subparagraph of Article 39(1A) will always fall within that sub-paragraph.

(2) A hereditament falling (or deemed to fall) within paragraph (1 B) of Article 39 will always fall within that paragraph.

15. —(1) There has been no relevant contravention of—

(a) any statutory provision; or

(b) any requirement or obligation, whether arising under a statutory provision, an agreement or otherwise.

(2) In sub-paragraph (1) ‘relevant contravention” means a contravention which would affect the capital value of the hereditament.”

The 2006 Order also amended the 1977 Order (regarding appeals) as follows:

“Appeals from the Commissioner …..

33. For Article 54 of the principal Order... there shall be substituted the following Articles—

“Appeal from decision of Commissioner

54. —(1) Any person, other than the Department, who is aggrieved by—

(a) the decision of the Commissioner under Article 49A or on an appeal under Article 51; or

(b) an alteration made by the Commissioner in a valuation list in consequence of such a decision,

may appeal to the appropriate Tribunal.

(2) On an appeal under this Article the Tribunal may—

(a) make any decision that the Commissioner might have made; and

(b) if any alteration in a valuation list is necessary to give effect to the decision, direct that the list be altered accordingly.

(3) On an appeal under this Article, any valuation shown in a valuation list with respect to a hereditament shall be deemed to be correct until the contrary is shown.

(4) In this Order “the appropriate Tribunal’ means—

(a) in relation to such appeals as may be prescribed, the Valuation Tribunal;

(b)-.

The Evidence

There was no oral evidence. The tribunal had before it the appellants’ form of appeal to the tribunal (Form 3) and copies of various documents including the following:

The Commissioner’s Decision on Appeal dated 13 May 2011.
A document entitled “Presentation of Evidence” dated 11 August 2011 prepared on behalf of the Commissioner by Land and Property Services and submitted to the tribunal for the purposes of the tribunal hearing.
The Appellants’ Notice of Appeal received by the Tribunal on 22 June 2011.
Order of the Tribunal dated 20 June 2011 extending the time for delivering an appeal.
Correspondence between the tribunal and the parties.

The Facts

On the basis of such information as was before it the tribunal determined, upon the balance of probabilities, the following facts:

The hereditament consists of a dwellinghouse situated at 11 Creevy Otra Road Armagh (“the property”). The property is stated to be occupied by the appellants, but the tribunal had no other information regarding title, nor regarding the physical construction and characteristics of the property, save as is mentioned in the papers before the tribunal and referred to below. The appellants are understood to be the ratepayers.
The property is a detached house of brick and block construction with pitched roof. The property has mains electric and water services. It is served by a septic tank and has central heating. The property has a gross external area of 230m2 and is believed to have been built in or about 2010.
The capital value assessment of the property is £175,000 at antecedent valuation date, that being 1 January 2005 (“AVD”). In arriving at that capital value assessment figure regard was had to assessments in the valuation list of properties considered comparable. These comparables are set out in a schedule to the Commissioner’s Statement of Case, with further particulars, including photographs. There are seven comparables in total. A copy of the Commissioner’s Statement of Case has been provided to the appellant and the appellants have responded thereto in their submission to the tribunal.

THE APPELLANTS’ SUBMISSION

The appellants’ grounds of appeal are as follows:

The close proximity of the farm buildings to the house.
The right of way for agricultural traffic to travel around the house.
Apart from the small front garden, the site only extends several metres around the footprint of the house.
No garage and no available space to erect one.
Similar shaped properties on Creevy Otra Road are valued around £180,000; these properties have private entrances with larger front and rear gardens.

THE TRIBUNAL’S DECISION

Article 54 of the 1977 Order enables a person to appeal to the tribunal against the decision of the Commissioner on appeal as to capital value. In this case the capital value has been assessed at the AVD at a figure of £175,000. On behalf of the Commissioner it has been contended that that figure is fair and reasonable in comparison to other properties and the statutory basis for valuation has been referred to and especially reference has been made to Schedule 12 to the 1977 Order in arriving at that assessment.

The tribunal must begin its task by taking account of an important statutory presumption contained within the 1977 Order. Article 54(3) of the 1977 Order provides: “On an appeal under this Article, any valuation shown in a valuation list with respect to a hereditament shall be deemed to be correct until the contrary is shown”. It is therefore up to the appellant in any case to challenge and to displace that presumption, or perhaps for the Commissioner’s decision on appeal to be seen to be so manifestly incorrect that the tribunal must take steps to rectify the situation.

The Tribunal is satisfied that the Commissioner has acted in the prescribed manner provided for by Schedule 12, paragraphs 7 (and following) of the 1977 Order. The statutory mechanism has been expressly referred to in the Commissioners Statement of Case and the tribunal notes the evidence contained in the report as to comparables.

If there is nothing wrong on the face of it with the Commissioner’s approach, the appellants must adduce evidence or make sufficient argument to displace the statutory presumption.

Having considered the evidence and submissions the Tribunal concludes and note as follows:

The Commissioner has already reduced the Capital Valuation by 15% on account of the agricultural right of way and the close proximity of the property to farm buildings.
Despite this the Tribunal has placed much weight on the points made by the appellants in their letter to the Tribunal dated 1 September 2011. In particular we note that some of the comparables have their own private entrance (whereas the property does not) and that the property is particularly proximate to farm activity and vehicles, with a very narrow ribbon around the house.
The Tribunal has considered the case of Liggett -v- Commissioner of Valuation (Ref 01/08) and sees no reason in this case to deviate from the normal maximum reduction of 20%, taking account of such matters as noise, smell and dangers from agricultural equipment, etc.

In all the circumstances of this case the Tribunal considers that the appeal should be allowed and that the Capital Valuation of the property shall be £164,000. The Commissioner shall alter the Valuation list accordingly.

Mr John Duffy, Chairman
Northern Ireland Valuation Tribunal

Date decision recorded in register and issued to parties: 14 December 2011