Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: September 17, 2015 FILE NO.: WR 129386

Assessed Person(s): Randall Irwin Chaiet and Christine Jenny Chaiet Appellant(s): Randall Irwin Chaiet and Christine Jenny Chaiet Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 09 Respondent(s): City of Toronto Property Location(s): 791 Spadina Road Municipality(ies): City of Toronto Roll Number(s): 1904-112-300-02400-0000 Appeal Number(s): 2994830, 3016848 and 3074064 (deemed 2015) Taxation Year(s): 2013, 2014 (and deemed 2015) Hearing Event No. 562756 Legislative Authority: Section 40 of the Assessment Act, R.S.O. 1990, c. A.31, as amended Heard: November 27, 2014 in Toronto, Ontario

APPEARANCES:

Parties	Counsel+/Representative
R. I. Chaiet and C. J. Chaiet	Self-represented
MPAC	S. Stadelmann
City of Toronto	No one appeared

DECISION OF THE BOARD DELIVERED BY TANYA WALKER

BACKGROUND

1The property under appeal is located at 791 Spadina Road in the City of Toronto. It was built in 1949 and is a fourplex. It has a total building area of 5,198 square feet.

SUBMISSIONS

2Stephen Stadelmann, the representative for MPAC, contends that the assessed value of $1,106,000 for the subject property is reasonable, based on comparisons to four other properties in the vicinity. Mr. Stadelmann also submitted a study of the sale prices of 240 properties in the vicinity of the subject property to demonstrate a 15.74% increase in sales prices for these properties from January 2011 to December 2012.

3Randall Irwin and Christine Jenny Chaiet, the Appellants, submit that the subject property is assessed at too high a value in comparison to the assessment and sale values of certain nearby properties. They submit that a fair and equitable assessed value should be, at most, $825,000.

ISSUE

4The Assessment Review Board (“Board”) must determine the correct current value for the subject property, and if that value is equitable with assessments of similar lands in the vicinity.

DECISION

5The Board determines the current value of the subject property to be $1,106,000.

6The Board has made reference to the assessments of similar lands in the vicinity and finds that no adjustment is required to make the assessment of the subject property equitable with the assessments of similar properties in the vicinity.

7Therefore, the decision of the Board is to reduce the assessment from $1,378,000 to $1,106,000 for the 2013, 2014 and deemed 2015 taxation years.

REASONS FOR DECISIONS

Legislation

8In determining the value at which land shall be assessed, the Board must have regard to the following provisions of the Act:

9Section 1 of the Act states:

“current value” means, in relation to land, the amount of money the fee simple, if unencumbered, would realize if sold at arm’s length by a willing seller to a willing buyer.

10Section 19(1) of the Act states:

19.(1) Assessment based on current value. – The assessment of land shall be based on its current value.

11Section 19.2(1) of the Act states:

19.2(1) Valuation days – Subject to subsection (5), the day as of which land is valued for a taxation year is determined as follows:

1. For the 2006, 2007 and 2008 taxation years, land is valued as of January 1, 2005.
2. For the period consisting of the four taxation years from 2009 to 2012, land is valued as of January 1, 2008.
3. For each subsequent period consisting of four consecutive taxation years, land is valued as of January 1 of the year preceding the first of those four taxation years.

12Section 44.(3) of the Act states:

44.(3) Same, 2009 and subsequent years. – For 2009 and subsequent taxation years, in determining the value at which any land shall be assessed, the Board shall,

(a) determine the current value of the land; and (b) have reference to the value at which similar lands in the vicinity are assessed and adjust the assessment of the land to make it equitable with that of similar lands in the vicinity if such an adjustment would result in a reduction of the assessment of the land.

13Section 40.(17) of the Act states:

40.(17) Burden of proof. – For 2009 and subsequent taxation years, where value is a ground of appeal, the burden of proof as to the correctness of the current value of the land rests with the assessment corporation.

Analysis

14Under the Act the Board is required to:

1. find the current value of the subject property;
2. make reference to the value at which similar lands in the vicinity are assessed; and
3. adjust the assessment of the subject property if the adjustment would result in a reduction in the assessment.

Current Value

15The best measure of the current value of a property is the price at which it sold in an arm’s-length transaction on the valuation date. In the absence of such a transaction, the Board must consider recent arm’s-length sales of comparable properties in the same vicinity.

16Mr. Stadelmann introduced a Market Analysis Study in support of the $1,106,000 assessment he proposes. This document compares four sold properties to the subject property, as detailed in Table 1 below.

Table 1

	Subject Property	Property A	Property B	Property C	Property D
Address	791 Spadina Road	924 Avenue Road	501 Oriole Parkway	184 Highbourne Road	132 Braemar Avenue
Structure Description	Fourplex	Triplex	Duplex	Duplex	Duplex
Year Built	1949	1929	1913	1933	1935
Renovation Year	1990	1990	2013	1990	1990
Bldg. Size (sq. ft.)	5,198	4,411	2,928	2,334	4,476
Effective Site Area (sq. ft.)	8,500	5,411.2	5,913.2	3,630	5,200
Bedrooms	8	8	6	4	8
Storeys	2	2.25	2.5	2	2
Basement Area (sq. ft.)	2,599	1,868	1,105	1,150	2,238
Sale Amt. ($)		1,000,000	950,000	885,000	990,000
Sale Date		2011/02	2011/07	2011/12	2011/05
Time adj. sale amt. ($)		1,071,389	984,356	887,817	1,039,473

17Mr. Stadelmann submits that the best comparator is Property B. Mr. Stadelmann submits that Property B and the subject property share similar locational issues in that they both abut commercial property. The subject property is located adjacent to a Mr. Lube location. Property B is adjacent to a fast food restaurant. The value of both properties is consequently impacted by odours, traffic and noise. MPAC allowed an adjustment of 18% to account for the detrimental impact of its location on the potential sale price of the subject property.

18The assessment value of the subject property significantly exceeds the time-adjusted sale amount for Property B. The subject property is significantly newer and larger than Property B. Property B was renovated much more recently than the subject property. However this renovation occurred subsequent to the sale of Property B and so did not impact the sale price. The time-adjusted sale amount for Property B is $336.19 per square foot (based on structure size) or $166.47 per square foot (based on lot size). By comparison, the assessment value of the subject property is $212.77 per square foot (based on structure size) or $130.12 (based on lot size).

19Mr. Stadelmann further submits that Property D is also relatively comparable to the subject property. Both properties were renovated during the same year. The subject property is larger than Property D and is assessed at $66,527 in excess of the time-adjusted sale amount for Property D. The time-adjusted sale amount for Property D equates to $232.23 per square foot (based on structure size) or $199.90 (based on lot size).

20Mr. Stadelmann submits that Property C is inferior to the subject property because it is smaller in terms of both structure size and lot size. For comparison purposes, the time-adjusted sale amount for Property C equates to $380.38 (based on structure size) or $244.58 (based on lot size). Similarly the time adjusted sale amount for Property A equates to $242.89 (based on structure size) or $197.99 (based on lot size). Consequently, the time-adjusted sale amount per square foot of each of the comparator properties submitted by Mr. Stadelmann exceeds the assessed value per square foot of the subject property.

21The Chaiets submitted their own set of comparable sales into evidence as Exhibit 3. These sales are detailed in Table 2 below:

Table 2

	Subject Property	Property 1	Property 2	Property 3	Property 4
Address	791 Spadina Road	132-134 Braemar Avenue	272 Winona Drive	464 Lawrence Avenue West	1047 Mount Pleasant Road
Structure Description	Fourplex	Fourplex	Fourplex	Multiplex	Duplex
Effective Site Area (sq. ft.)	8,500	5,200	2,550	7,470.36	3,300
Bedrooms	8	2	6	9	6
Storeys	2	2	2	2	2
Sale Amt. ($)		990,000	830,000	1,054,000	1,050,000
Sale Date		2011/04	2012/07	2011/09	2012/04
Time adj. sale amt. ($)		1,046,430	796,800	1,078,242	1,026,900
Time adj. sale amt. per sq. ft. (lot size) ($)		201.24	312.47	144.34	311.18

22Mr. Stadelmann initially objected to the admission of the comparable sales submitted by the Chaiets on the basis that, contrary to Rule 45(2) of the Rules of Practice and Procedure (“Rules”), this evidence was not disclosed 21 days in advance of the hearing. However, in response to the Board’s inquiry as to whether he wished for the appeal to be adjourned, Mr. Stadelmann stated that he did not wish an adjournment and that he would withdraw his objection.

23Mr. Chaiet submits that the average sale price of the properties detailed in Table 2 is $837,000.

24Unfortunately, evidence was not available with respect to the building sizes for the properties detailed in Table 2. However, the Board notes that the assessment value per square foot of the subject property, based on lot size, is $130.12. This is less than any of the comparators submitted by Mr. Chaiet.

25However, Mr. Chaiet submits that the value of the subject property is less than that of the comparators he submitted due to negative locational factors.

26Specifically, the subject property adjoins a service station. Mr. Chaiet submits that litter, chemical toxins and noise emanate from the service station interfering with the Appellants’ use and enjoyment of the subject property.

27The subject property is also located in close proximity to a bus stop which, Mr. Chaiet submits, is a source of pedestrian traffic, loitering and litter.

28The subject property is situated on Spadina Road, in a high traffic area. Mr. Chaiet submits that this contributes to air and noise pollution.

29Mr. Chaiet further submits that nearby high rise buildings and fire and ambulance facilities contribute to the high volume of traffic and interfere with the Appellants’ privacy.

30The Board notes that MPAC has made substantial allowances for the impact of the locational factors identified by Mr. Chaiet. Specifically, MPAC has applied a 23% reduction to account for the volume of local traffic. MPAC has applied further reductions of 8% to account for the adjoining service station and 10 % to account for economic obsolescence in general. Further, the subject property is located in the Forest Hill neighbourhood which offsets, to some degree, the negative locational factors enumerated above.

31Mr. Chaiet states that subject property is still in its original condition and has not been renovated. The Board notes that MPAC has allowed a 10% reduction to account for functional obsolescence.

32Mr. Chaiet submitted into evidence as Exhibit 2a, a letter of opinion, dated October 3, 2013, authored by Steven Smurlick, a realtor with Royal Lepage. Mr. Smurlick estimates the value of the subject property at $817,000. Mr. Smurlick’s letter of opinion states that he inspected the subject property but does not detail the reasoning for his assessment of its value. Further, Mr. Smurlick did not testify. Consequently, the Board is able to assign little weight to Mr. Smurlick’s opinion.

33Mr. Chaiet submits that, as an income property, the assessment value of the subject property should be based on its income potential, rather than its sale value. The Board notes however, that s. 19.(1) of the Act provides that the assessment of land shall be based on its current value. As defined in s. 1 of the Act, current value means the amount of money the property would realize if sold at arm’s length by a willing seller to a willing buyer. Consequently, pursuant to the Act, the Board is required to base its deliberations on the sale value of the subject property, rather than its income potential. Further, no documentation with respect to the income earned by the subject property was submitted into evidence.

34Based on the comparators submitted and the time-adjusted sale amounts per square foot of these properties, the Board sets the current value of the subject property at the recommended value of $1,106,000.

Reference to Similar Lands in the Vicinity

35The Assessment to Sales Ratio (“ASR”) of a property compares its value as assessed with its sale price. An ASR of 1.00 indicates that the assessment value is identical to the sale price.

36Mr. Stadelmann introduced a study of 30 residential properties in the vicinity of the subject property. Mr. Stadelmann submits that this study demonstrates that MPAC’s assessment methodology achieved equitable assessments because the median time-adjusted ASR was 1.00, which falls within the acceptable range of 0.90 – 1.10, as mandated by the International Association of Assessing Officers.

37Mr. Chaiet submitted data relating to the change in assessment values of 10 additional comparator properties as detailed in Table 3 below:

Table 3

Property	Address	2012 Assessment ($)	2013 Assessment ($)	Increase in Assessment Value (%)
Subject Property	791 Spadina Road	795,000	941,000	18.4
Property I	1212 Avenue Road	754,000	773,000	2.5
Property II	1206 Avenue Road	821,000	669,000	(18.5)
Property III	1749 Bathurst Street	832,000	850,000	2.2
Property IV	879 Millwood Road	831,000	841,000	1.2
Property V	1775 Bayview Avenue	1,107,000	1,131,000	2.2
Property VI	390 Davenport Avenue	1,049,000	1,099,000	4.8
Property VII	987 Avenue Road	1,106,000	1,143,000	3.3
Property VIII	1747 Bayview Avenue	1,240,000	1,254,000	1.1
Property IX	1783 Bayview Avenue	1,042,000	1,064,000	2.1
Property X	1729 Bathurst Street	994,000	1,031,000	3.7

38Mr. Chaiet submits that the increase in assessment value of the subject property is disproportionate to the assessment increases of the comparators submitted. The Board notes that, in a 2010 decision relating to the subject property, Board Member Andrews found that Properties I and II were comparable to the subject property (Chaiet v. Municipal Property Assessment Corp. Region No. 09, [2010] O.A.R.B.D. No. 179 at para 16). The assessment value of Property I has increased by only 2.5% while the assessment value of Property II has been reduced by 18.5%.

39The Board further notes that the median assessment value increase of the properties detailed in Table 3 above is 2.2%, far less than the 18.5% increase in assessment value of the subject property proposed by MPAC.

40However, the Board also notes that the sample of comparators submitted by Mr. Chaiet is much narrower in breadth than that submitted by Mr. Stadelmann. Further, the Board notes that s. 44.(3)(b) of the Act mandates that the Board have reference to the assessment value of similar lands in the vicinity. It does not mandate that the Board make reference to the increase in assessment value of the subject property in comparison to similar lands. The Board notes that the median 2013 assessment value of the properties detailed in Table 3 is $1,047,500, significantly greater than the assessment value of the subject property.

41The Board has also considered the study of 240 properties in the vicinity of the subject property submitted by Mr. Stadelmann to demonstrate a 15.74% increase in sales prices for these properties from January 2011 to December 2012.

42Consequently the Board does not find that any adjustment is required to achieve equity with similar lands in the vicinity, as required by s. 44.(3)(b) of the Act.

CONCLUSION

43The Board determines the current value of the subject property to be $1,106,000.

44The Board has made reference to the assessments of similar lands in the vicinity and finds that no adjustment is required to make the assessment of the subject property equitable with the assessments of similar properties in the vicinity.

45Therefore, the decision of the Board is to reduce the assessment from $1,378,000 to $1,106,000 for the 2013, 2014 and deemed 2015 taxation years.

2015 DEEMED APPEAL

46An appeal for the 2014 taxation year is presently before the Board. Section 40.(26) provides that the appellant is deemed to have made the same appeal for the subsequent taxation year if the appeal is not finally disposed of before March 31 of the subsequent taxation year. The Board has not disposed of the 2014 appeal before March 31, 2015. For that reason, this decision also applies to the 2015 taxation year.

47Section 40.(26) of the Act directs:

Deemed appeals, 2009 and subsequent years

For 2009 and subsequent taxation years, an appellant shall be deemed to have brought the same appeal in respect of a property,

(a) in relation to the assessments under sections 32, 33 and 34 for the year; and (b) in relation to the assessment, including assessments under sections 32, 33 and 34, for a subsequent taxation year to which the same general reassessment applies, if the appeal is not finally disposed of before March 31 of the subsequent taxation year or, if an assessment has been made under section 32, 33 or 34, before the 90th day after the notice of assessment was mailed.

“Tanya Walker”

TANYA WALKER MEMBER

Assessment Review Board A constituent tribunal of Environment and Land Tribunals Ontario Website: www.elto.gov.on.ca Telephone: 416-212-6349 Toll Free: 1-866-448-2248```