Municipal Property Assessment Corporation Region 14 v Evans et al, 2024 ONAFRAAT 21

Agriculture, Food and Rural Affairs Appeal Tribunal 1 Stone Road West

Tribunal d’appel de l’agriculture, de l’alimentation et des affaires rurales 1 Stone Road West

Guelph, Ontario N1G 4Y2 Tel: (519) 826-3433, Fax: (519) 826-4232 Email: AFRAAT@ontario.ca

Guelph (Ontario) N1G 4Y2 Tél.: (519) 826-3433, Téléc.: (519) 826-4232 Email: AFRAAT@ontario.ca

AGRICULTURE, FOOD AND RURAL AFFAIRS APPEAL TRIBUNAL

APPEAL:

Municipal Property Assessment Corporation Region 14, The Administrator, Farm Property Class Tax Rate Program, Town of East Gwillimbury, George William Evans, Estate of Iva Gertrude Evans, Terry Evans, and Terry George Evans, Amy Ramsay, Sarah Buckle [ORDER]

Municipal Property Assessment Corporation Region 14 v Evans et al (RE) [ORDER] 2024 ONAFRAAT 21

STATUTE:

Section 40.1 of the Assessment Act (the “Act”) and Section 31 of Ontario Regulation 282/98.

HEARING:

September 5, 2024

DATE OF DECISION:

December 5, 2024

1569; 1570; 1571

NEUTRAL CITATION:

2024 ONAFRAAT 21

FILE NO.: 1569; 1570; 1571

DATE: 2024/12/05

IN THE MATTER OF Section 40.1 of the Assessment Act (the “Act”) and Section 31 of Ontario Regulation 282/98.

AND IN THE MATTER OF a referral to the Agriculture, Food and Rural Affairs Appeal Tribunal (“Tribunal”) by the Assessment Review Board (“Board”) of an appeal by the Municipal Property Assessment Corporation Region 14 as to whether the portions of the property identified by roll number 1954-000-029-26000-0000 whose current value was determined by the Board to be used for farm purposes should be designated in the farm property class and thus be eligible for the reduced tax rate for the 2016 (FL 184892), 2017 and 2018 (FL 184893) and 2019 (FL 184894) taxation years.

AND IN THE MATTER OF a motion brought by the Administrator, Farm Property Class Tax Rate Program, challenging the jurisdiction of the Tribunal to hear this matter held pursuant to Rule 30 of the Tribunal’s Rules of Procedure.

BETWEEN:

Municipal Property Assessment Corporation Region 14 Appellant

– and –

The Administrator, Farm Property Class Tax Rate Program Respondent

– and –

Town of East Gwillimbury Respondent

– and –

George William Evans, Estate of Iva Gertrude Evans, Terry Evans Respondents

Terry George Evans, Amy Ramsay, Sarah Buckle Respondents

Before: Robert Fuller, Vice Chair, Sarah Judd, Member

Parties Present:

Matthew Kanter, Counsel, MPAC Sana Sajid, Counsel, MPAC Scott McAnsh, Counsel, Respondents Val Adema, Director of Finance, Town of East Gwillimbury Kristopher Crawford-Dickinson, Counsel, The Administrator Rushda Munshi, Counsel, The Administrator Meghan Hillis, Articling Student, The Administrator

Represented by Matthew Kanter and Sana Sajid

Represented by Rushda Munshi and Kristopher Crawford-Dickinson Self-Represented Represented by Scott McAnsh Represented by Scott McAnsh

HELD September 5, 2024 via Zoom

MOTION ORDER

OVERVIEW

1. A Pre-Hearing Conference in this matter was held on May 28, 2024. At the Pre-Hearing Conference, the Administrator, Farm Property Class Tax Rate Program (“The Administrator”) took the position that the Tribunal lacked jurisdiction to hear this matter.

2. A Jurisdictional Motion hearing was held on September 5, 2024 at 10:00 a.m. pursuant to the Order of the Tribunal and a Notice of Motion of the Administrator dated June 3, 2024.

BACKGROUND

3. The property identified by roll number 1954-000-029-26000-0000 was included in the Farm Property Class (the “FPC”) for the 2015 taxation year.

4. In 2015, a 2016 multi-year application form was mailed to the respondents, George William Evans – Iva Getrude Evans Estate to have the Property included in the FPC for the 2016 taxation year.

5. The Administrator did not receive an application for the 2016 taxation year for the property by December 31, 2016.

6. The Administrator found that the respondent property owners George William Evans, Estate of Iva Gertrude Evans and Terry Evans did not complete the application.

7. Without a completed application, the property was removed from the FPC. The Administrator did not receive a request for reconsideration of the decision to remove the property within the statutory deadline in 2016.

8. On June 20, 2022, the Respondent Terry Evans brought a motion pursuant to Section 40.1 of the Act for an extension of time to bring assessment appeals for the 2016 to 2019 taxation years for the property before the Board.

9. By Decision dated July 14, 2022, the Board found that there were palpable errors in the assessment roll for the property for the 2016 to 2019 taxation years.

10. The appellant Municipal Property Assessment Corporation Region 14 (“MPAC”) requested a review of the Board decision of July 14, 2022. The Board varied the decision of July 14, 2022 in its amended review decision of July 12, 2023 to state that “The Board finds that it appears that there are palpable errors in the assessment roll for the 2016 to 2019 taxation years.”

11. The Board further rescinded and replaced a portion of the July 14, 2022 decision and stated, in part “…The Board extends the time for filing appeals for the Subject Property for the 2016 to 2019 taxation years, and directs that MPAC be the appellant;… and the only issue that may be raised in the appeals is whether the Subject Property qualifies as land in the Farm Property Class.”

12. MPAC brought the appeals as directed by the Board which were heard on August 22, 2023.

13. The Board found on August 22, 2023 in File No’s FL 184892, FL 184893 and FL 184894 that a portion of the property was farm land used for farm purposes within the meaning of s. 19(5) of the Act for the taxation years in question and referred to the Tribunal the issue of whether the farm land used for farm purposes should be classified in the FPC.

ISSUES

14. The Administrator primarily argues in its motion that Subsection 40(3) of the Act applies to Section 40.1 of the Act to require a request for reconsideration by the owners within the time limits set forth prior to an appeal by MPAC in order for the Tribunal to have jurisdiction to hear this matter.

15. The Administrator further argues that the failure of the property owners under Section 8.1 of O.Reg 292/98 (the “Regulation”) to properly file an application on time for each of the tax years in question renders the Tribunal without jurisdiction to hear this matter.

FINDINGS AND ANALYSIS

16. For the reasons provided below, the Tribunal dismisses this motion.

Purpose and effect of Section 40.1.

17. The Administrator urges the Tribunal to consider Canada (Minister of Citizenship and Immigration) v. Vavilov 2019 SCC 65, [2019] 4 SCR 653 (SCC) in its interpretation of the wide applicability of Subsection 40(3) to Section 40.1. The Tribunal is cognisant of the rules of statutory interpretation set out therein. The Tribunal’s below findings on the purpose of Section 40.1 are not inconsistent with Vavilov.

18. The Tribunal accepts the argument of the property owners, noting that the Board’s jurisprudence advanced by the respondent property owners includes a consideration of the fairness and reasonableness aspects of whether or not to exercise the discretion to extend the time for appealing and directing MPAC to be the appellant. It is during this analysis that questions regarding missed deadlines or other preconditions are resolved.

19. For example, the Board in Municipal Property Assessment Corporation v Guelph Eramosa Township, 2018 CanLII 263 (ON ARB) states in part:

11Section 40.1 is unique in the Act in that it has no limitation period. Everything else in the Act favours finality after a specified period of time. The legislature must have intended that the section be rarely used. A frequent reliance on s. 40.1 would obviously undermine the limitation scheme that dominates the Act.

20. The cases of Piggott v Municipal Property Assessment Corporation, Region 28, 2019 CanLII 109527 (ON ARB) and Brockville (City) v Municipal Property Assessment Corporation, 2016 ONSC 5752 also illustrate the Board reaching back in time to correct an error not evident at the time in question. Piggott in particular provides an analysis that includes consideration of the extension of time applying to any missed deadlines or preconditions over a number of years.

21. The Administrator argues that the Board’s Section 40.1 jurisprudence is not relevant, and that the jurisprudence that addresses extending the time to appeal does not address curing any preconditions or missed deadlines otherwise needed to appeal.

22. The Tribunal finds that the case law is relevant and finds that the purpose of Section 40.1 is remedial and by its nature is designed to extend back to a period of time to correct a palpable error, a purpose which would be largely nullified if a missed historical deadline or other precondition were sufficient to disqualify the proceeding. The purpose of Section 40.1 could not have been intended to be restricted in such a manner. An order by the Board to extend the time to appeal and to direct MPAC to be the appellant under Section 40.1 must also serve to cure any procedural defect or missed deadline needed for that appeal to proceed.

23. Any missed deadlines are considered by the Board when it contemplates whether to exercise its discretion to extend the time to appeal and direct MPAC to be the appellant. Piggott and other Board jurisprudence make it clear that considering the circumstances of missed deadlines or unfulfilled preconditions are part of the analysis employed when determining if the Board should extend the time for appealing and direct MPAC to be the appellant. Such missed deadlines could not then serve to stymy the very appeal that MPAC is directed to make.

24. If a failure to file an application or to meet some other precondition were to bar proceeding with an appeal following an order made under Section 40.1, the purpose of Section 40.1 would be rendered largely nonviable as in many cases the taxpayer would be unaware of the error until well after the filing deadline. If the Tribunal accepts the interpretation of the Administrator, it would be hard to imagine many, if any, scenarios in which an appeal following an order made under Section 40.1 could proceed.

25. While the Tribunal relies on statutory interpretation and the jurisprudence advanced by the property owners to make the above findings on Section 40.1 matters, the Tribunal notes that Section 40.1 has been extensively considered. It is clear from the jurisprudence that Section 40.1 has been used to address errors even where deadlines have been missed. Indeed, reaching back in time to correct errors long after deadlines have passed seems to be a key feature of Section 40.1.

26. The position of the Administrator runs counter to this jurisprudence, as the request for reconsideration requirement and other deadlines also apply to other proceedings under the Act. For example, the Tribunal notes the recent detailed analysis and conclusions of the Board in the recent amended decision of 388210 Ontario Limited v Municipal Property Assessment Corporation Region 15, 2023 CanLII 64028 issued on August 23, 2023. Vice-Chair Dirk VanderBent provides a detailed analysis of Section 40.1 and states:

a. [22] Section 40.1 does not prescribe a limitation period for when a request to correct can be made. In comparison, s. 32 only allows MPAC to make a correction during a calendar year prior to the return of the assessment roll and for a current taxation year. When correcting an omission, s. 33 only allows for a correction in the current and two preceding taxation years. Under the s. 40 appeal process, the Board may only correct an error or omission for the taxation year in which an appeal is filed. Therefore, but for s. 40.1, uncorrected errors or omissions that occur prior to these specified taxation years could not be corrected.

b. [26] The Board begins by noting that s. 40.1 does not impose a limitation period for submitting an application to correct a palpable error, whereas the appeal provision in s. 40 of the Act does, and sections 32 and 33 provide limited timeframes in which corrections can be made. In enacting s. 40.1 without imposing a limitation period, the Legislature was obviously aware of the timeframes prescribed in other sections of the Act. Consequently, it is clear that the purpose of s. 40.1 is remedial, in that the Legislature has enacted a separate section to correct certain errors which have not been corrected under other sections of the Act. Therefore, the purpose of s. 40.1 is to provide for a process to amend the assessment roll that is supplementary to the other provisions of the Act. Accordingly, s. 40.1 is not an exception to the s. 40 appeal process, nor is it contrary to the other provisions of the Act. As stated by the Divisional Court in 1609830 Ontario Limited v. Municipal Property Assessment Corporation, Region No. 9, 2008 CanLII 47726 (ON SCDC) at paragraph 14:

The individual sections of the Assessment Act are inter-dependant [sic], and must be read in context and purpose of entire Act, which is to regulate the orderly and fair collection of public taxes based upon an accurate assessment roll. [Emphasis added.]

c. [27] In arriving at this conclusion, the Board has also considered the following points. First, the Board notes that, had the Legislature intended to limit the application of s. 40.1 to matters that could not be addressed by MPAC under s. 32 and s. 33, or by the Board in a s. 40 appeal proceeding, it could have included such a prerequisite condition in s. 40.1. The Legislature has chosen not to do so.

d. [29] Third, the remedy provided in s. 40.1 is significantly narrower in scope than the remedy provided by the s. 40 appeal process. In this regard, the Board notes the Legislature imposed restrictive conditions in s. 40.1, namely: (i) the requirement that there must be an error; (ii) that error must be palpable; and (iii) that correcting a palpable error is not “as of right”, because the Legislature has given the Board discretion to decide whether a palpable error should be corrected. In comparison, a party in a s. 40 appeal can challenge any aspect of MPAC's assessment - including MPAC’s opinion as to current value - “as of right” without first having to establish that there is a factual error in the assessment roll. Therefore, the Board does not accept that s. 40.1 can be characterized as an alternate remedy that could be misused for the purpose of avoiding the requirement to file appeals under s. 40. Any person who chooses not to file an appeal under s. 40, and, instead, applies under s. 40.1, significantly narrows both the grounds which the person can advance, and the degree of certainty that the relief requested will be granted, since correction of an error is discretionary rather than “as of right”.

e. [31] This concern raises the question: why did the Legislature consider it necessary to include s. 40.1 in the Act? The Legislature could have implemented a regime under s.32, 33 and 40 of the Act which provided for a complete regime for correction of errors, i.e. for the purpose of finality of assessment, errors that have not been identified and corrected within the time frames prescribed in these sections need not be addressed. While this is a policy decision the Legislature could have made, it clearly has not done so. By including s. 40.1 in the Act, it is clear that the Legislature has made the policy decision that certain errors which have not been corrected within the timeframes prescribed in s. 32, 33, and 40 of the Act can be Corrected outside these time frames.

Request for reconsideration

27. The Tribunal’s findings on the purpose and effect of Section 40.1 are sufficient to dismiss this motion. However, in the event the Tribunal is incorrect in its assessment of the purpose and effect of Section 40.1, we find in the alternative that the Administrator’s arguments on this jurisdiction motion concerning Subsection 40(3) of the Act and Section 8.1 of the Regulation must fail.

28. The Administrator submits that Section 40 of the Act together with Section 31 of the Regulation applies to appeals under Section 40.1 and hence the failure of the owners to make a request for review under Subsection 40(3) is fatal to the appeal.

29. The Administrator argues that Section 40 of the Act is the only section within the Act that deals with appeals and cites Municipal Property Assessment Corporation v. Montevallo Developments Limited, 2008 CanLII 69580 (ON SCDC) (“Montevallo”) for the binding proposition that this appeal must proceed pursuant to the requirements set out under Section 40 of the Act, including Subsection 40(3).

30. Subsection 40(3) of the Act provides:

If a property is in the residential, farm or managed forests property class, or in such other circumstances as the Minister may prescribe, no appeal may be brought to the Assessment Review Board under Subsection (1) by a person who is entitled to make a request for reconsideration under Section 39.1 in respect of the property, if the person has not made the request within the time required under that section.

31. We find that Montevallo does not assist the Administrator as the decision indicates that only parts of Section 40, as it read at the time, are relevant. The Tribunal also notes paragraph 31 of the decision which states:

31The party bringing a complaint before the Board usually is entitled to determine the issues submitted to the Board. However, this is not the usual case. The complaint in issue has been ordered by the Board, pursuant to section 40.1 (b) of the Act. In enacting that the Board "may" exercise the powers contained in section 40.1 (b), the Legislature gave the Board the discretion to determine when, and in what circumstances to exercise those powers. The Board was entitled to decide the issues to be raised in the complaint which it was entitled to direct MPAC to institute, for the purpose of correcting palpable errors which it found in the assessment roll.

32. The Administrator’s argument that the owner must apply for a request for reconsideration in order for an appeal to proceed after an order extending the time to appeal and directing that MPAC be the appellant has been made by the Board does not account for the fact that MPAC, and not the owner, is the appellant in this matter. The argument is misplaced.

33. Subsection 39.1(1) of the Act sets out the “person who is entitled to make a request for reconsideration” referred to in Subsection 40(3):

The owner of a property or a person who has received or would be entitled to receive a notice of assessment under this Act may request the assessment corporation to reconsider.

34. This provision does not capture MPAC. Even if the Tribunal is incorrect in its interpretation of the general non-applicability of time limits or the need for a request for reconsideration for matters under Section 40.1 to proceed, the Tribunal finds that MPAC is not a “person who is entitled to make a request for reconsideration under Section 39.1 in respect of the property” under Subsection 40(3) of the Act and thus not bound by the restrictions therein. While Section 40 does apply to Section 40.1 matters per Montevallo, the precondition to appeal that is placed on owners in Subsection 40(3) to request a reconsideration prior to appealing is not applicable in this case because this is an appeal by MPAC.

35. For the same reason, Subsection 30(1) of the Regulation, which permits an owner to make a request for reconsideration to the Administrator, also does not apply to an MPAC appeal.

Criteria for inclusion in the Farm Property Class

36. The Administrator submits that Subsection 8.1(8) of the Regulation prohibits the Administrator from accepting a FPC application to have the property included in the FPC past December 31 of the taxation year in which that FPC application relates. The Administrator further asserts that the Tribunal lacks jurisdiction to proceed with this matter because the owners failed to submit applications for inclusion in the FPC on time and thus do not meet the criteria for inclusion in the FPC.

37. The question to be determined per the Board’s referral to the Tribunal is whether the farm land used for farm purposes should be classified in the FPC.

38. While the Administrator may take the position that one or more criteria for inclusion in the FPC have not been met, such a position does not deprive the Tribunal of the jurisdiction to make the determination of whether those criteria have in fact been satisfied.

39. The respondent property owners argue in their motion materials that all the criteria for inclusion in the FPC have in fact been meet. They argue that none of the circumstances set forth in Subsection 8.1(3.1) of the Regulation apply to require a new application and hence the removal of the property from the roll was the palpable error and, but for this error, Section 8.1 would be satisfied.

40. It is for the Tribunal to decide between the Administrator’s position on the Section 8.1 criteria and the respondent owners’ position. A hearing can proceed to receive the argument and evidence necessary to determine if the FPC criteria are met in this case.

41. The Tribunal thus finds that even if preconditions or deadlines could be fatal to a Section 40.1 matter despite the order of the Board to extend the time to appeal and direct MPAC to be the appellant, it would be open for the Tribunal, after due consideration, to find that the criteria for inclusion in the FPC have been met.

CONCLUSION

42. In summary, based on the above findings, the Tribunal concludes that it has jurisdiction to hear the appeal. Missed historical deadlines or other preconditions to appeal are not fatal to a matter proceeding where the Board has exercised its discretion to extend the time to appeal and directs that MPAC be the appellant. The purpose of Section 40.1 would be largely frustrated if missed historical deadlines stopped the process from correcting an apparent palpable error in the roll.

43. In the alternative, the lack of a request for reconsideration by the owners would not apply where MPAC is the appellant. The argument that conditions to appeal placed on an owner apply to an MPAC appeal is misplaced and does not reflect the statutory language.

44. Whether or not the criteria for inclusion in the FPC have been met is a matter for the Tribunal to decide following the hearing.

45. The recitation of the facts by all parties seem very similar and the present situation lends itself to a written hearing on the remaining issues in question. To assist the timely administration of justice, the Tribunal finds that a written hearing would be appropriate.

46. As the respondent property owners set forth their position on the property’s qualification in the FPC at length in their materials, it would be appropriate to have MPAC, the Administrator and the Town provide their submission, if any, first.

ORDER

47. The motion of the Administrator is denied.

48. The hearing on the determination of whether the portions of the property determined by the Board to be farm land used for farm purposes should be in the FPC shall proceed by written submission only.

49. The Administrator shall provide their written evidence and submissions first by December 20, 2024, followed by the appellant and the respondent Town, if any, by January 15, 2025, followed by the reply of the property owners, if any, by January 29, 2025.

50. The matter of costs on this motion and the written hearing may be made to the Tribunal as part of the submissions for the written hearing.