High Court of Ireland Decisions

Premier Periclase Ltd. v. Commissioner Of Valuation [1999] IEHC 8 (24th June, 1999)

Appeal No. VA 96/2/015

IN THE MATTER OF THE VALUATION ACTS, 1852-1988

AND IN THE MATTER OF THE VALUATION OF THE HEREDITAMENT

DESCRIBED AS PERICLASE WORKS (PART OF) AND GROUNDS

AT MAP REFERENCE 24 BC, TOWNLAND OF NEWTONSTALABAN,

E.D. ST. PETER'S VOL 1 RD LOUTH

BETWEEN

JUDGMENT of Mr. Justice Kelly delivered the 24th day of June 1999.

INTRODUCTION

1. This is a Case Stated by the Valuation Tribunal. It was stated at the request of the Commissioner of Valuation. He was dissatisfied with a decision of the Tribunal dated the 13th October 1997 which held that five tanks used by Premier Periclase Limited (the Company) were exempt (non-rateable) under Reference No. 1 of the Schedule to the Valuation Act, 1860 as inserted by Section 8 of the Valuation Act, 1986.

2. The opinion of this Court is sought as to whether the Tribunal was correct in this determination. Two subsidiary questions are also posed for the opinion of the Court. They are whether the Tribunal was correct in holding that where constructions are deemed non-rateablepursuant to Section 7(2) of the Valuation Act, 1860 (as substituted by Section 7(2) of the Valuation Act, 1986) and the Schedule to the Valuation Act, 1860 (as substituted by Section 8 of the Valuation Act, 1986), the Tribunal does not have to consider whether the constructions are rateable under the Valuation (Ireland) Act, 1852 as amended by Sections 2 and 3 of the Valuation Act, 1986 insofar as the Schedule to the said Act of 1852 refers to constructions affixed to lands. The final question upon which the opinion of the Court is sought is whether it is correct that where the Tribunal considered that constructions were non-rateable under Reference No. 1 as aforesaid, the Tribunal did not have to consider whether the tanks came within the provisions of Section 7(1)(a) of the Valuation Act, 1860 as inserted by Section 7 of the Valuation Act, 1986.

THE PROCEEDINGS BEFORE THE TRIBUNAL

3. There was an oral hearing before the Tribunal. Prior to it the respective parties made written submissions. Those submissions have been annexed to the Case Stated and form part of it. The Tribunal delivered a written determination and it also has been annexed to the Case Stated. So also are documents submitted in evidence by the Company'sworks director, Mr. Terence Gallagher.

4. The hereditaments the subject matter of the Case Stated were listed for revision on the 16th March, 1992. The revised list issued in November 1994. The Company appealed to the Commissioner of Valuation on the 8th November, 1994. The results of the first appeal were published in March 1996. The Company appealed the result of this appeal to the Tribunal on the 15th April, 1996. The valuation which was the subject of the appeal to the Tribunal was one of[sterling]1,150 in respect of hereditaments described as "miscellaneous". Included within that description were five tanks as follows:-

(a) One sea water clarifier tank. This was given a rateable valuation of [sterling]150 and is known as tank No. 2.

(b) One reactor tank. This was given a rateable valuation of [sterling]44 and is known as tank No. 3.

(c) Two thickener tanks which were given a rateable valuation of [sterling]310 and are known as tanks Nos. 4 and 5.

(d) One effluent tank. This was given a rateable valuation of [sterling]150 and is known as tank No. 6.

5. It is these tanks which are the subject of the Case Stated.

6. The tanks were described in detail in the précis of the evidence of Mr. Gallagher. The evidence of Mr. Gallagher was accepted in its entirety by the Tribunal.

7. The Tribunal summarised the nature, function and workings of each of the five tanks both in the body of the Case Stated and in its written judgment. It dealt with each of them as follows:-

"(a) The sea water clarifier - Tank No. 2.

This is a circular tank with 9 inch thick walls having an internal diameter of 56.4 meters and an external height of approximately 5.5 meters. It has a capacity of over 13,500 cubic meters. There is overhead cat-walk and screens with rotating arms.

Its function is threefold, namely, the neutralisation of acid, the reduction of colloidal and the removal of suspended sand, silt and clay which is within the sea water at the intake point.

All of this is achieved by a two stage process: reaction in the centre well with recycled magnesia precipitate which results in the removal of some dissolved sand and passage through a floating bed of precipitate which is maintained in the clarifier. The incoming sea water passes up through this bed which acts as a filter trapping sand and silt.

(b) The reactor tank (Tank No. 3)

This is a circular concrete tank with 9 inch thick walls about 5 foot in height. It has an internal diameter of 33 meters and a capacity of over 5,040 cubic meters, or 1.1 million gallons. It has an overhead cat-walk and screen with rotating arm.

Following the degassing, gassing and cleaning, the sea water flows by gravity to the centre well of this reactor. Lime slurry from the slaker is then added. In the reactor centre well there is a large turbine which rotates at plus/minus 4 revs. per minute. This rotation draws up the sea water which then mixes with the lime slurry. Immediately magnesia is precipitated. If uncontrolled, the reaction produces a very small, fine precipitate which would be extremely difficult to handle in the rest of the process. In order to prevent this, therefore, already produced precipitate is recycled from the primary thickeners. It is added to the pipeline taking the fresh sea water into the reactor and on reaching the centre well, acts as the seed onto which the new precipitate is deposited. For this reason, the recycled precipitate is known on the plant as "seed". Each time the seed in recycled the precipitate crystals get larger. With sufficient recycling a precipitate with good settling characteristics, suitable for use in the rest of the process, is produced.

From the reactor, the precipitate and the used sea water overflow to the primary thickeners.

(c) The primary thickener tanks (Tanks Nos. 4 and 5)

The primary thickeners are connected in parallel with one another. Each is circular in shape with 9 inch thick walls and a height of about 4 meters. The internal diameter is 99 meters and the capacity of each is in excess of 28,000 cubic meters. Again there is an overheadcat-walk and rotating arms provided.

The purpose of the thickeners is to partly separate the precipitate from the spent sea water. By mixing very slowly, the precipitate is allowed to settle at the bottom of the tanks with the spent sea water overflowing at the top. A chemical called "flocculent" is added. This is necessary because some of the materials are so fine they would not, without this chemical additive, stick together.

(d) The effluent clarifying tank (Tank No. 6)

This is circular in nature with 9 inch thick walls and a height of 5.5 meters. Its internal diameter is 56.4 meters and it has an operating volume of 15,487 cubic meters. This tank is identical in design and operation to the clarifiers.

The spent sea water overflowing the primary thickener tank goes to this clarifier where fresh water is used to neutralise some of its excess lime. The floating bed of precipitate is used as the final filter before returning the spent sea water back to the Irish Sea".

8. These tanks are used in a manufacturing process which is also set forth in the Case Stated. The Tribunal described it thus:-

"The manufacturing process commences in the Company's quarry where limestone is extracted and crushed and sent to the lime kiln for burning. It is then hydrated (slaked) and in that condition goes to the reactor tank in the wet end. In that tank, the slaked lime is mixed with treated sea water. The water comes from the RiverBoyne and goes through the clarifier for the purpose of removing impurities therein. It is then transferred to the reactor tank where it is mixed with the slaked lime. Immediately there is a chemical reaction in that when the lime dissolves, it displaces the magnesium hydroxide which comes out as a precipitated. This is then collected, de-watered in the primary thickening tanks, before being sent to themultihearth furnaces. From these thickeners, there is an overflow pipe which takes the spent water to the effluent tank.

In the said multihearth furnaces, the last of the water is removed and the precipitate is calcined (burned), changing it into pellets/briquettes which are then fed to the shaft kilns. In the shaft kilns, the pellets are heated to a high temperature resulting in a changed dense unreactive periclase. The finished product is then ready for storage to await outward shipping from the Company's private wharf in Drogheda".

9. The Valuation Tribunal helpfully sets forth the submissions which were made to it and they bear repetition in this judgment. The Tribunal recites:-

"It was submitted by Counsel on behalf of the Company that the aforesaid described tanks/equipment came within the provisions of Section 7 of the Valuation Act, 1860 as substituted by Section 7 of the Valuation Act, 1986 insofar as Section 7(1)(a) provides:-

'In making the valuation of any mill or manufactory or building erected or used for any such purpose, the Commissioner of Valuation shall in each case value the water or other motive power thereof, but shall not take into account the value of any machinery therein, save only such as shall be erected and used for the production of motive power'.

Counsel submitted that the tanks came within the definition of machinery which was not for the production of motive power. Counsel relied on the decision of the Supreme Court in Beamish v. Crawford [1980] ILRM 149 at page 151 and on Pfizer Chemical Corporation v. The Commissioner of Valuation (judgment of Lavan J. 28th July, 1984).

Alternatively, Counsel on behalf of the Company submitted that the equipment came within the definition of non-rateable plant pursuant to Section 7(2) of the Valuation Act, 1860 (as substituted by Section 7 of the Valuation Act, 1986) and the Schedule to the Valuation Act, 1860 (as substituted by Section 8 of the Valuation Act, 1986) which provides:-

'7(2) The Commissioner of Valuation shall value plant falling within any of the categories of plant specified in the Schedule to this Act (inserted by the Valuation Act, 1986).

Schedule

All constructions affixed to the premises comprising a mill, manufactory or building (whether on or below the ground) and used for the containment of a substance or for the transmission of a substance or electric current, including any such constructions which are designed or used primarily for storage or containment, whether or not the purpose of such containment is to allow a natural or a chemical process to take place, but excluding any such constructions which are designed or used primarily to induce a process of change in the substance contained or transmitted'.

Counsel for the Company submitted that the equipment consisted of constructions which were designed or used primarily to induce a process of change in the substance contained therein and were therefore exempt.

Counsel relied upon the decision of Caribmolasses Company Limited v. Commissioner of Valuation [1991] 1 IR 379 and unreported Supreme Court, 25th March, 1993; and the decision of the Valuation Tribunal in Midland Malting Company Limited v. The Commissioner of Valuation (VA 89/0/178 and VA 90/0/2/050).

Counsel submitted that taken individually, each of the constructions was designed to induce a process of change in the substance transmitted therein.

Counsel also relied upon the decision of the Valuation Tribunal in North Kerry Milk Products Limited v. The Commissioner of Valuation (VA 89/0/024 and VA 89/0/625). Counsel conceded that this was of doubtful authority in the light of the Supreme Court judgment in Caribmolasses.

Counsel stated that the Company did not seek to rely upon the argument of integration and submitted that the case was close to the decision of the Valuation Tribunal in Golden Vale Food Products Limited v. The Commissioner of Valuation (VA 88/0/088).

Counsel on behalf of the Commissioner submitted that:-

1. The contested items were of such scale, performance, and substance that they were rateable under the provisions of the Schedule to the Valuation (Ireland) Act, 1852 (as amended by Sections 2 and 3(1) of the Valuation Act, 1986) which provide:-

'2. For the purpose of the Act of 1852, property falling within any of the categories of fixed property specified in the Schedule to the Act of 1852 (inserted by this Act) shall be deemed to be rateable hereditaments in addition to those specified in Section 12 of that Act.

Schedule

All constructions affixed to lands or tenements other than buildings ....'

Counsel relied upon the judgment of Lavan J. in Pfizer Chemical Corporation v. Commissioner of Valuation (VA 88/0/056 and 057) 28th July, 1994 as establishing that all the tanks were constructions of fixed land and therefore came within the provisions of Section 3 of the 1986 Act, amending the 1852 Act.

Counsel submitted that, alternatively, if the items are regarded as plant, they do not fall within the exclusion contended for by the Company.

Counsel relied on the judgment of the Supreme Court in Caribmolasses in that regard.

Counsel submitted that what went into the clarified sea water tank was sea water and that what came out of the tank was sea water so that there was no process of change.

Counsel submitted that the magnesium hydroxide, called precipitate, which was pumped from the reactor to the settling/storage tanks was contained therein for three to four days and that no chemical reaction took place therein. The only matter added in the primary thickness wasflocculent in order to help fine material to stick together. Counsel submitted that this did not change the nature of the material contained in the tank.

Counsel submitted that the effluent treatment tank received spent sea water with an alkalinity of pH. 12 and some excess lime and what was pumped from the effluent treatment tank was sea water with an alkalinity of less than pH. 12 but otherwise which was exactly what went into the tank, i.e. sea water.

Counsel also relied upon the decision of the Valuation Tribunal in Siucra Eireann CPT v. Cork County Council and The Commissioner of Valuation (VA 88/0/112 and 286)".

THE JUDGMENT AND CONCLUSIONS OF THE TRIBUNAL

10. In its judgment, the Tribunal referred to an earlier decision which it gave on the 14th March, 1997 in a case called Carberry Milk Products v. Commissioner of Valuation (VA 95/4/026). It pointed out that issues of law almost identical to those relevant in the present case were considered. It expressed the view that having regard to the judgment in the Carberry Milk Products case, the general propositions set out at paragraph 8 of the judgment of the Tribunal could be stated. It then proceeded to purport to apply those propositions of law to the facts of the case as either found or agreed before the Tribunal. The general propositions set forth in paragraph 8 were stated as follows:-

"(a) If prior to the Valuation Act, 1986 a receptacle, to use a neutral phrase, was under and within Section 7 of the 1860 Act properly described as 'machinery' then that receptacle was entitled to exemption from rating.

(b) If post-1986 the same receptacle could however, also be described as 'plant' within Reference No. 1 to the Schedule of the 1860 Act as inserted by Section 8 of the Act of 1986, then its rateability has also to be considered in the context of that reference number.

(c) Any receptacle, used simply for storage purposes or for a multitude of purposes, but with storage being the predominant one cannot qualify 'as machinery' and therefore cannot get exemption under Section 7.

(d) Receptacles used simply or predominantly for storage purposes remain so even if contained within, are facilities which alter the viscosity of the contents of such receptacles.

(e) Receptacles with facilities for agitation only may or may not, but in general will not qualify as machinery.

(f) In determining whether a receptacle 'predominantly is one for storage purposes' one general test is to examine the activity carried on therein. If such activity is merely for the purposes of retaining or maintaining the contents of the receptacle (or even perhaps for mixing or blending) in a particular condition whilst awaiting the core manufacturing process, then it is not machinery. If on the other hand the activity within, is in itself a proximate part of the manufacturing process, then exemption should follow.

(g) When considering Reference No. 1 to the Schedule of the 1860 Act, a crucial question is, whether such receptacle is designed or used primarily to induce a process of change with the words 'to induce' meaning to bring about or cause a change in the process.

(h) When dealing with the definition of 'machinery' for the purposes of Section 7, the components should not merely be regarded separately or piecemeal, but as integral parts of the process in which they are used (see page 151 of the judgment of O'Higgins C.J. in Beamish & Crawford [1980] ILRM 149).

(i) This 'part of the integral process' approach, clearly applies to the different components of a separate or distinct receptacle, apparatus or unit e.g. one of several grain bins or milk installation. But in addition, it also applies where it can be truly said that collectively such bins or installations or the like are or form an inherent part of a continuous and direct manufacturing process (see page 95 ofDenis Coakley & Co. v. Commissioner of Valuation [1996] 2 ILRM 90).

(j) This approach, as last mentioned, does not apply when the point at issue is whether or not Reference No. 1 to the Schedule of the 1860 Act applies. (See the Supreme Court decision in Caribmolasses Co. Limited v. Commissioner of Valuation, unreported 25/5/93)".

11. The judgment of the Tribunal then goes on to apply those principles to its consideration of the facts pertinent to each tank individually. It deals with the matter in the following way. It said:-

"In applying the law to the facts of this case, as so found or agreed, we propose firstly to consider the provisions of Reference No. 1 to the Schedule of the 1860 Act. It will be recalled that under this reference if the tanks in question are designed or used primarily for storage or containment (whether or not the purpose of such containment is to allow a natural or chemical process to take place, then they are rateable, but if the same are designed or used primarily to induce a process of change, then they are not.

10. In approaching this issue, as we do, by taking each tank individually, we have arrived at the following conclusion:-

(a) The sea water reactor - Tank No. 2:-

As is stated above, when the sea water reached its intake point from the River Boyne, it contains sand, silt, clay and other impurities. This material has to be removed. In addition to this function the tank also has a neutralising role in the acidity of its contents as well as reducing the dissolved silica in the spent water. These functions are all carried out in an active way within the tank. There is no question of the sea water simply being stored in this tank. It is there so that a change in its composition can take place. Whilst undoubtedly it is true to say that what emerges therefrom and what goes to the reactor tank remains water, nevertheless it is by an artificial process carried on therein, a liquid now with impurities removed. The elimination of such sand, silt and clay is an integral part of this process and there can be no question of an activity taking place therein being used or designed solely to maintain the water in the state and condition in which it was before it entered the tank. Accordingly, we are satisfied that it is used and most certainly primarily used to induce a process of change.

(b) The reactor tank - Tank No. 3:-

There can be no doubt but that an immediate chemical reaction takes place within this tank once the lime slurry meets and mixes with the treated sea water. Indeed, the core compound which is the foundation of the entire manufacturing process and of the ultimate consumer product is established here. With a large turbine rotating therein and a reactor centre well, we are quite satisfied that this must be exempt, under Reference No. 1 to the Schedule of the 1860 Act.

(c) The primary/settling tanks - Tanks Nos. 4 and 5:-

Having gone through the reactor, the precipitate is then collected and sent to these two primary tanks. The function performed therein is to separate this precipitate from the spent water. This takes place not only in a natural way but also in a chemical way. During the course of the hearing it was suggested that there was no necessity for the injection of'Flocculent' intake but that instead the same result could be achieved by having bigger tanks. This was rejected by Mr. Gallagher who stated, and we accept, that some materials are so fine, that this 'sticking process' never takes place without the flocculent. Whilst it is correct to say that chemically the product is the same before it enters the tanks as it is when it leaves the tanks, nevertheless what goes in as a single solution comes out as a different solution. The effect therein is to separate the solid from the liquid. Again, we have had evidence to the effect that this is an integral part of the process which could not, even if storage could be achieved elsewhere, be dispensed with. Accordingly, we are satisfied that these tanks should equally be declared exempt.

(d) The effluent clarifier - Tank No. 6:-

This tank, which is the final step in the integrated system, is identical in size, construction, design and operation as the sea water clarifier. It receives the spent sea water overflows from the primary thickener. Its function is not only to reduce the alkalinity of the overflow from the pH. of 12 to a pH. of less than 11, but also to achieve a reduction of suspended solids. This is achieved by continuous circulation of magnesium hydroxide within therecirculated drum and reaction well, both located therein. Further fresh water is added. The reaction reduces the alkalinity. A floating bed of precipitate is used as a final filter before this spent sea water is returned to the sea. As we have already held that the sea water clarifier should be exempt, we are also of the view that this tank likewise should be exempt. There is no difference in principle between both, though perhaps the process of change and the methods used to achieve that change, are somewhat less in this tank than they are in the sea water clarifier. That however would not in our opinion be a sufficient justification to treat this tank differently to the sea water clarifier.

Accordingly, we are of the opinion that all of these tanks are exempt under Reference No. 1 of the Schedule to the 1860 Act as inserted by Section 8 of the Valuation Act, 1986. In these circumstances it is not necessary to consider the issue which arises under Section 7".

THE SUBMISSIONS OF THE COMMISSIONER OF VALUATION

12. The following is a summary of the submissions made by the Commissioner of Valuation in respect of these findings of the Valuation Tribunal:-

(a) The sea water reactor tank - Tank No. 2.

13. The Commissioner submits that the Tribunal erred in its findings insofar as it considered the tank to be an integral part of a process having previously, correctly, identified that the integration test had no place when valuing plant. Further, it is said that the Tribunal identified that what went into the tank and came out of the tank was the same, namely water. It is submitted by the Commissioner that the"change" to the water identified by the Tribunal is no greater than the "change" in the Caribmolasses case and in the Pfizer case and that consequently there is no real distinction to be made between the two cases. Furthermore, it is said that the difference, if there is any, is certainly not sufficient to trigger the exclusion clause.

(b) The reactor tank - Tank No. 3.

14. It is conceded by the Commissioner that this tank is used to induce a process of change. It is the fact that there is a process of change in the tank which distinguishes it from the other tanks and which highlights that the other tanks are tanks which are not used to induce a process of change in the substance contained therein (other than perhaps by way of natural or chemical process).

(c) The primary settling tanks - Tanks Nos. 4 and 5.

15. The Commissioner submits that the Tribunal recognise that the function of the tanks was either natural or chemical. As such, it does not come within the exception suggested by Reference No. 1 of the Schedule and furthermore it is said that the Tribunal used an integration test which was not permissible. It is also contended that the Tribunal recognise that chemically the product which went into these tanks was the same as the product which comes out and therefore there is no distinction of any sufficient significance between the process in these tanks and the process rejected as a process of change in theCaribmolasses case and in the Pfizer case.

(d) The effluent clarifier - Tank No. 6.

16. Here, the Commissioner of Valuation contends that the manner of working of the tank as described by the Tribunal is such as clearly identifies a natural process and not an induced process of change such as is required to trigger the exception under Reference No. 1. Again, the Tribunal is criticised for using an integration test which is not permissible in relation to plant. It is said that on the basis of the descriptions of the tanks as contained in the Tribunal'sjudgment, they have the sense of substantiality identified by Lavan J. in the Pfizer case and accordingly were rateable as constructions. It is said that once a property is rateable, there is no need to make further enquiry in relation to whether or not it is rateable under any other category of the Valuation Code. Therefore, it is said that all of the tanks are rateable as constructions and the Tribunal did not need to consider whether they were either within the provisions of Section 7(1)(a) or Section 8 of the 1986 Act.

17. In order to understand these it is necessary to refer briefly to the Caribmolasses case and the Pfizer case. In the Caribmolasses case, the occupier owned two tanks into which it pumped crude molasses from ships by means of a pipeline. In those tanks the substance was stored and blended. Part of the blending process sought to achieve a uniform viscosity in molasses from different shipments and sources by pumping the substance from one tank into the other. Following release from the tanks, the primary change to the molasses was effected by the injection of steam and hot water at external main pumps to form what was known as standardised molasses to meet the various requirements of different purchasers. The tanks were assessed by the Commissioner of Valuation as being plant not coming within the exclusion provided in the Schedule to the Act of 1860. On appeal, the Valuation Tribunal found that the tanks were used primarily to induce a process of change in the substance contained in them and that such use was an integral part of an overall operation, the purpose and effect of which was to induce that change and it concluded that the tanks were non-rateable plant. On appeal to this Court,Gannon J. affirmed the conclusion of the Valuation Tribunal on the basis that the tanks were "designed or used primarily to induce a process of change" in the crude molasses even though that process required containment for a determinate or indeterminate period and, moreover, any such containment assisted or was an integral part of the process of change, even though merely ancillary to some other catalytic agency.

18. Gannon J. was reversed by the Supreme Court. In the course of his judgment Blayney J. said:-

"The case was decided by both the Valuation Tribunal and Gannon J. on the basis that the tanks were prima facie rateable hereditaments but that they were not in fact rateable as they came within the exception in the Schedule inserted by Section 8 of the 1986 Act being 'designed or used primarily to induce a process of change in the substance contained' in the tank. So the issue to be determined by this Court is whether they were correct in finding that the tanks came within the exception".

19. Later in his judgment Blayney J. said:-

"It was common case that the tanks were plant and came within the Schedule in Section 8 unless they could be brought within the exclusion clause, that is to say, unless they were 'designed or used primarily to induce a process of change in the substance contained'. So the sole issue is whether on the facts the respondents established that they came within the exception, and quite clearly the onus of proof is on them to do this. This involved showing that it followed from the facts found in the Case Stated, or at lease as an inference from those facts, that the tanks came within the exception. I am satisfied that the respondents have failed to establish this.

What do the facts tell us about the tanks? It appears from sub-paragraphs 2, 3 and 7 in paragraph 3 of the Case Stated that the tanks have steam coils on their floors and that these may be heated by steam produced by an oil-fired burner outside the tanks, but in practice the steam coils are not used. There is clearly no evidence here of the tanks being designed or used primarily to induce a process of change in the molasses. The only inference one could draw is that the purpose of the heating coils is to raise, if necessary, the temperature of the molasses but there is no finding that this would induce a process of change in the molasses".

20. Blayney J. then went on to review the findings which had been made in the Case Stated. He said of them:-

"The only finding there on which the respondents can rely is that the tanks, in addition to being used for holding and containment, as found expressly in sub-paragraph 5, are also used for blending, but in my opinion it is clear from the nature of the blending, and the manner in which it is effected, that the tanks are not being used primarily to induce a process of change in the molasses. Firstly, no process of change is induced. The molasses remain molasses. What happens is that the different types of molasses, instead of forming a massive irregular composition, are mixed so as to form a homogenous whole. Secondly, even if there were a process of change induced in the molasses, it is not induced by the tanks. They are simply used to contain the molasses while the blending is effected by the molasses being pumped from one tank to the other.

Finally, it appears from sub-paragraphs 8 and 10 of the findings in the Case Stated that insofar as any change takes place in the molasses, this occurs after the molasses has left the tanks".

21. This decision of the Supreme Court was followed by Lavan J. in Pfizer Chemical Corporation v. Commissioner of Valuation (unreported 28th July 1994). I do not propose to recite extensively from this judgment as I do not think it adds anything to the views expressed by Blayney J. and merely purported to apply the test expressed by him. Reliance was also placed on the decision of the Supreme Court in Trustees of Kinsale Yacht Club v. Commissioner of Valuation (Supreme Court unreported 10th February, 1994). In the course of his judgment, Finlay C.J., speaking for the Court, said:-

"I am satisfied that this statutory provision of the 1986 Act cannot, of course, with any precise use of words be described as either a taxation or penal statute. It does, however, having particular regard to the phrase used in Section 2 of the 1986 Act that categories of fixed property specified in the Schedule inserted by that Act shall be deemed to be rateable hereditaments in addition to those specified in Section 12 of the Act of 1852 constitute a platform or necessary statutory precondition intended to lead to the 'fresh imposition of liability' in the meaning of those words as contained in thejudgment of Henchy J. (in Inspector of Taxes v. Kiernan). I see no logical reason therefore why these statutory provisions should not receive from the Court the strict interpretation referred to in that judgment.

Applying such a strict interpretation, the first matter that is clear without any ambiguity is that Section 2 of the Act of 1986 provides in express words that property falling within any of the categories of fixed property specified in the Schedule as inserted shall be deemed to be rateable hereditament. Those words must, it seems to me, unless otherwise impressed with any ambiguity by virtue of the terms of the Schedule, mean what they say, namely, that if a particular property falls within one of the categories of fixed property specified in the Schedule, that no further enquiry need be made as to whether it falls into any other category of fixed property specified in the Schedule nor is the Court concerned with the terms of other categories of fixed property specified in the Schedule".

22. The submissions of the Commissioner of Valuation must, of course, be seen within the context of the jurisdiction of this Court on a Case Stated. I have none of the advantages which the Tribunal had of having viva voce evidence and cross-examination on it. It is to be noted that three witnesses gave such evidence before the Tribunal and crucial to that was the evidence of Mr. Gallagher, the Works Director who is a Chartered Engineer. His evidence was accepted in its entirety by the Tribunal. A précis of his evidence is contained at Appendix II to the judgment of the Tribunal. It is clear that the Tribunal determined that each of the tanks were designed or used primarily to induce a process of change in the substance contained or transmitted therein within the meaning of Reference No. 1 of the Schedule. The question immediately arises as to whether this Court is entitled on a Case Stated to disturb those findings made by the Tribunal.

PRINCIPLES UPON WHICH THIS COURT MUST OPERATE ON A CASE STATED

In Mara v. Hummingbird Limited [1982] ILRM 421 Kenny J., in dealing with the jurisdiction of the High Court on a Case Stated, said:-

"The Case Stated consists in part of findings and questions of primary fact e.g. with what intention did the taxpayers purchase the Baggot Street premises. These findings and primary facts should not be set aside by the Courts unless there was no evidence whatever to support them. The Commissioner then goes on in the Case Stated to give his conclusions or inferences from these primary facts. These are mixed questions of fact and law and the Court should approach these in a different way. If they are based on interpretation of documents, the Court should reverse them if they are incorrect for it is in as good a position to determine the meaning of documents as is the Commissioner. If the conclusions from the primary facts are ones which no reasonable Commissioner could draw, the Court should set aside his findings on the ground that he must be assumed to have misdirected himself as to thelaw or made a mistake in reasoning. Finally, if his conclusions show that he has adopted a wrong view of the law, they should be set aside. If, however, they are not based on a mistaken view of the law or a wrong interpretation of documents, they should not be set aside unless the inferences which he made from the primary facts were ones that no reasonable Commissioner could draw".

23. Kenny J. further commented on the fact that the Appeal Commissioners often have evidence, some of which points in one direction and other evidence in the opposite direction. Concerning how that evidence is dealt with, he said:-

"These are essentially matters of degree and his conclusions should not be disturbed (even if the Court does not agree with them, for we are not retrying the case) unless they are such that a reasonable Commissioner could not draw them, or they are based on a mistaken view of the law".

24. The law in this area has developed somewhat since the decision in Mara v. Hummingbird. In O'Keeffe v. An Bord Pleanála [1993] 1 IR 39, the Supreme Court expounded what is now called the principle of curial deference to decisions of an expert administrative tribunal such as the one in suit in these proceedings. That principle was further explained in the decision of the Supreme Court in Henry Denny and Sons (Ireland) Limited v. Minister for Social Welfare [1998] 1 IR 34. The case concerned an appeal on a point of law pursuant to Section 271 of the Social Welfare (Consolidation) Act, 1993. In the course of his judgment, Hamilton C.J. set forth the approach which the Courts should take when asked to interfere with the decision of an expert administrative tribunal. He said:-

"They should be slow to interfere with the decisions of expert administrative tribunals. When conclusions are based on an identifiable error of law or an unsustainable finding of fact by a Tribunal, such conclusions must be corrected. Otherwise, it should be recognised that Tribunals which have been given a statutory task to perform and exercise their functions as is now usually the case with a high degree of expertise and provide coherent and balancedjudgments on the evidence and arguments heard by them, it should not be necessary for the Courts to review their decisions by way of appeal or judicial review".

25. Whilst I am not here dealing with judicial review, I am of course dealing with an appeal by way of Case Stated with all of the limitations involved in that which I have already pointed out.

26. In the course of his judgment in that case Keane J. said that the findings of fact made by the Appeals Officer could not be disturbed "unless they were incapable of being supported by the facts or were based on an erroneous view of the law".

27. There is no doubt but that the Valuation Tribunal is the type of body which Hamilton C.J. had in mind when expressing the views which I have just quoted from his judgment in the Denny case. In the instant appeal, the Tribunal consisted of its chairman, who is a Senior Counsel, and two deputy chairmen. One is a Barrister and the other is a Fellow of the Royal Institute of Chartered Surveyors. This Court should be slow to interfere with its decisions. It should only do so on the basis of an identifiable error of law or an unsustainable finding of fact.

28. Adopting that approach to the findings made by the Tribunal in the present case, the following appears to me to be the situation.

THE CONCLUSIONS OF THE TRIBUNAL

29. In determining, as it did, that each of the tanks were designed or used primarily to induce a process of change in the substance contained or transmitted within the meaning of Reference No. 1 to the Schedule, the Tribunal was, in my view, making determinations of primary fact. It was open to the Tribunal to do so on the basis of the evidence before it. This is particularly so having regard to the evidence of Mr.Gallagher, the Works Director, a Chartered Engineer and a person whose evidence was accepted in total by the Tribunal. Consequently, the finding made by the Tribunal that a tank was designed or used to induce a process of change is a finding of primary fact. It is not open to this Court to interfere with such a finding unless it is satisfied that there was no evidence to justify such findings. That is not the case here. Consequently, I am of the view that the Court cannot interfere with the Tribunal's determination of primary fact that each of the tanks were designed or used primarily to induce a process of change.

30. If, contrary to the finding which I have just made, the Tribunal's findings in relation to each of the tanks can be regarded as inferences to be drawn from primary facts, then it appears to me that the Commissioner would have to satisfy me that no reasonable Valuation Tribunal could draw those inferences from the evidence before it in order to have this Court interfere with the findings. In my opinion there was clearly evidence before the Tribunal which entitled it to draw the inferences in question. They are not inferences which no reasonable Valuation Tribunal could draw. Consequently, I would not be justified in interfering with the decision of the Tribunal in this case.

31. Even if I am wrong in all of the above conclusions and the Tribunal's determination that each of the tanks came within the excluding provisions of Reference No. 1 of the Schedule to the 1860 Act as inserted by Section 8(1) of the 1986 Act could be characterised as determination of law, then, in my view, the Commissioner has failed to identify an identifiable error of law such as would permit this Court to interfere with the decision of the Tribunal. Again, in my opinion, the evidence which was before the Tribunal was sufficient to enable it to conclude that the tanks were designed or used primarily to induce a process of change. Suchbeing the case, the Tribunal's assessment of the evidence and the application of the facts to the provisions of the Act, in my opinion, cannot be regarded as an identifiable error of law which would permit this Court to intervene with the Tribunal's decision.

CONCLUSION

32. In view of the above findings, I am of the opinion that the decision of the Valuation Tribunal cannot be interfered with and that accordingly its determination that all of the tanks were exempt (non-rateable) under Reference No. 1 of the Schedule to the Valuation Act, 1860 as inserted by Section 8 of the Valuation Act, 1986 is correct in law. It is not, therefore, necessary for me to consider the subsidiary questions which were posed.

33. The first question will, therefore, be answered in the affirmative and it is not necessary to answer the second and third questions.