Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: December 15, 2015

FILE NO.: DM 135336

Moving Party(ies): Arbor Memorial Incorporated

Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 15

Respondent(s): Town of Oakville (“Town”)

Property Location(s): Con 1 NDS Pt Lots 6 and 7

Municipality(ies): Town of Oakville

Roll Number(s): 2401-010-020-05710-0000

Taxation Year(s): 2004, 2005, 2006 and 2007

Hearing Event No.: 600038

Legislative Authority: Section 40.1 of the Assessment Act, R.S.O. 1990, c. A.31, as amended

Heard: August 26, 2015

APPEARANCES:

Parties	Counsel⁺/Representative
Arbor Memorial Incorporated	C. Francis
MPAC	K. Lunau⁺
Town of Oakville	S. Price

DISPOSITION OF THE BOARD DELIVERED BY SUSAN F. MATHER

DISPOSITION OF MOTION

1After reading the materials filed and hearing the submissions of counsel and representatives the Board Orders:

1. The time for filing appeals on Roll Number 2401-010-020-05710 for the 2004, 2005, 2006 and 2007 taxation years is extended.

2. MPAC is directed to be the appellant for the appeals on Roll Number 2401-010-020-05710 for the 2004, 2005, 2006, and 2007 taxation years.

3. The newly created appeals are adjourned to a pre-hearing conference by way of telephone conference call as follows:

TCC Hearing No: 613433 Date: March 1, 2016 Time: 3:00 p.m.

No earlier than five minutes prior to the indicated start time participants to the call must dial one of the following numbers:

From within Toronto: 416-212-8012 From outside of Toronto: 1-866-633-0848

After the conference greeting enter the code: 9814805 #

You will be connected to the call with all other participants. Please remain on the line until the Presiding Member calls the hearing to order.

If experiencing technical difficulties, press ‘*0’ to access the I-Serve operator for assistance.

REASONS FOR DISPOSITION OF MOTION

2Arbor Memorial Incorporated (“AMI”) seeks relief under s. 40.1 of the Assessment Act, R.S.O. 1990, c. A.31, as amended (“Act”) and asks the Assessment Review Board (“Board”) to find that there are palpable errors in the assessment roll for Roll Number 2401-010-020-05710 (“the property)” for taxation years 2004-2007.

3Section 40.1 provides:

40.1 Correction of errors. – If it appears that there are palpable errors in the assessment roll,

(a) if no alteration of assessed value or classification of land is involved, the Board may correct the roll; and

(b) if alteration of assessed values or classification of land is involved, the Board may extend the time for bringing appeals and direct the assessment corporation to be the appellant

4Section 14(1) of the Act sets out the information that the assessment roll must contain.

Assessment roll

Contents

14. (1) The assessment corporation shall prepare an assessment roll for each municipality, for each locality and for non-municipal territory and the assessment roll shall contain the following information as well as the information required under subsections (1.1) and (1.2):

15. The name and surnames, in full, if they can be ascertained, of all persons who are liable to assessment in the municipality or in the non-municipal territory, as the case may be.

16. The amount assessable against each person who is liable to assessment, opposite the person’s name.

17. A description of each property sufficient to identify it.

18. The number of acres, or other measures showing the extent of the land.

19. The current value of the land.

20. The value of the land liable to taxation.

21. The value of land exempt from taxation.

22. The classification of the land.

23. Such other information as may be prescribed by the Minister. 2006, c. 33, Sched. A, s. 13 (1).

5The Board finds and the parties agree that there is a palpable error in the assessment roll for taxation years 2004-2007. The palpable error is that the information on the assessment roll with respect to the number of acres or other measure showing the extent of the land is incorrect because the roll does not reflect the conveyance of 16 acres including a golf course and other lands to the Town in 2003. The description of the property also is a palpable error in that the property is coded as a golf course (Exhibits H, I, L to Exhibit 1) for the taxation years 2004-2007.

6Palpable error is not defined in the Act.

7In the case of Burnac Corp., v. Municipal Property Assessment Corp., Region 9 [2013] O.A.R.B. No. 169 (“Burnac”) Member Walker found that “A palpable error is an obvious error not caused by an error in judgement, a distinction that may be difficult to make.”

8The Board is satisfied that the error in the roll not recognizing the conveyance of the golf course is a palpable error that does not require any judgment to determine.

9As a result of this palpable error it appears that an alteration to the current value and possibly an alteration to the classification of the land is be required to correct the error.

10Both MPAC and the Town argue that the Board should deny the motion of AMI on the basis of the prejudice that would result to the Town and MPAC if the motion were to be granted. MPAC and the Town argue that AMI took too long to identify the error and bring the motion before the Board.

11In the alternative MPAC argues that in the event the Board exercises its discretion the Board should restrict the correction of current value to an apportionment of the returned assessed value between the acres that remained under AMI owner ship and the acres conveyed to the Town.

The Facts

12When the assessment roll was returned for the 2003 taxation year the property was correctly shown on the roll to be comprised of 37.63 acres. Approximately 14 acres of the property were used as a golf course and 23 acres were land zoned as Natural Heritage System Land (“NHS”). The assessed value of the property was $ 2,936,000.

13On May 21, 2003 approximately 16 acres of the property was transferred to the Town including the 14-acre golf course and other land used for a roadway. As a result of the conveyance AMI was left with 21.41 acres of NHS land.

14For each of the 2004-2007 taxation years the assessment roll was returned showing the property to be 37.63 acres. The roll did not recognize the 2003 conveyance of the golf course and other land to the Town.

15For the 2008 taxation year the roll was returned showing the property as being 21.41 acres. It was still however coded as a golf course. (Exhibit H to Exhibit 1)

16Exhibit E to the affidavit of Kathryn Ellen Cole filed by MPAC as Exhibit 2 confirms that there are active unresolved appeals on the roll number for the 2003 and 2008 taxation years.

17According to the uncontroverted evidence of AMI found in the affidavit of Jeffrey Derbyshire filed by AMI as Exhibit 4 the roll number that is the subject of this motion ceased to exist as of the 2009 taxation year when the property was combined with other parcels under a new roll number.

18The property that is subject of this motion is part of lands known as Oakville Memorial Gardens. In paragraph four of his affidavit (Exhibit 4) Mr. Derbyshire summarizes the status of appeals for taxation year prior to 2009 on Oakville Memorial Gardens roll numbers.

19According to Mr. Derbyshire’s affidavit the appeals on the roll number were “dormant” until the Board scheduled a telephone conference for March 23, 2009.

20Exhibit “D” to Exhibit 4 contains the Statement of Issues for the 2008 appeal on the subject property dated June 6, 2009. Paragraph four of the Statement of Issues refers to the property in issue. It reads:

“Here again the appellant has no objection to this parcel being separately assessed as it is part of the abutting White Oaks Golf Course. There are no other issues”

21Mr. Derbyshire’s evidence is that confusion arose during the exchange of information on the assessment appeals because there were two distinct golfing operations at Oakville Memorial Gardens. While the property that is the subject of this motion was no longer part of a golf course after the conveyance in 2003 there was approximately 20 acres of other land owned by Oakville Memorial Gardens that was at all relevant times least for and operating as a golf driving range.

22It did not become apparent to AMI that the transfer to the Town was not reflected on the roll until March 2014 when Mr. Derbyshire discovered it during the exchange of productions on appeals.

23The Board received no evidence with respect to when either MPAC or the Town became aware of the error in the roll. The Board received no evidence to suggest that AMI was aware of the palpable error prior to March 2014.

Why the Board is Exercising Its Discretion

24The parties provided the Board case law to support their arguments for and against the Board exercising its discretion and with respect to the limitations if any that the Board may impose in exercising its discretion.

25In the case of the City of Toronto v. Annette Wolf, et.al. Court File No. 349/07 (Ontario Superior Court of Justice (Divisional Court)) that Court stated “there are competing purposes inherent in the scheme of the Act. To achieve equitable distribution of the tax burden there must be mechanisms to correct errors in the assessment roll. At the same time, in fairness to the taxpayer, there must be some finality in the system in order to achieve a stable and reliable tax base. That balance is achieved by the relatively simple, informal rights to complain, coupled with a specific and firm limitation period in the governing legislation.”

26Ms. Lunau reviewed the provisions of the Act and the Municipal Act, 2001 S.O. 2001, c. 25 that provide for appeals, corrections to the roll and cancellation reduction and refunds of taxes. She argues that the appellant had several avenues open to it to have the roll corrected and that it was too late to ask the Board to find a palpable error and exercise its discretion to direct MPAC to be the appellant in appeals.

27The Superior Court of Justice (Divisional Court) in the case of Municipal Property Assessment Corp., v. Montevallo Developments Limited, 1462199 Ontario Inc., The City of Toronto and The Assessment Review Board Court File No: 619/07 (“Montevallo”) found that unfairness to the taxpayer is one of the factors the Board must consider in deciding whether to exercise its discretion to allow late appeals due to a palpable error and the Board must balance unfairness to the taxpayer balance against the integrity of the assessment roll and the fairness to other taxpayers of the City.

28Both MPAC and the Town argue that it is too late for a palpable error to be corrected because of the prejudice to the taxpayers of the Town and the prejudice to MPAC. MPAC and the Town argue that AMI is a sophisticated party who should have been able to figure out that there was an error in the roll in time to file an appeal under the Act or to seek what relief may have been available under the Municipal Act.

29In considering the issue of prejudice the assessment history of the property must be looked at to determine the point in time it became known to the parties that there was a palpable error and how quickly the aggrieved party acted to remedy the error.

30The Board accepts the uncontroverted evidence of Mr. Derbyshire (Exhibit 4) that the landholding and related appeals were complex and that it was not until 2014 that AMI realized that there was an error in the assessments for the 2004-2008 taxation years.

31The fact that the 2003 conveyance was not “picked up” by MPAC when the general reassessment was done for both the 2004-2005 and the 2006-2008 taxation years supports the AMI’s argument that the number of roll numbers occupied by Oakville Memorial Gardens made it difficult to recognize the error.

32The fact that the error was not discovered when the Statement of Issues for the 2008 taxation year was prepared also supports Mr. Derbyshire’s contention that the holdings were complex.

33The Board is satisfied on the evidence before it that AMI has brought this motion within a reasonable time after the error was identified.

34The assessed person (“taxpayer”) should not have the sole responsibility for insuring the integrity of the assessment roll.

35MPAC as the assessing authority has a responsibility to prepare an accurate roll. Section 31 of the Act requires MPAC to issue a change notice when there is a change in any information described in s. 14(1) of the Act.

36Section 31(1) of the Act states:

Notice of assessment

31. (1) If there is a change in any information described in subsection 14 (1), (1.1) or (1.2) in respect of a parcel of land and the change is not reflected in the last assessment roll as returned, the assessment corporation shall deliver to every person described in subsection 14 (1) who is affected by the change a notice, in a form approved by the Minister, showing,

(a) the person’s assessment and the current value of the parcel of land;

(a.1) the classification of the parcel of land;

(b) the person’s school support, if applicable; and

(c) such other particulars as are directed by the Minister to be shown in the notice,

and the assessment corporation shall enter in the roll opposite the name of the person the date of delivery of the notice or shall make one or more certificates to be attached to the roll or to any part of the roll certifying the date or dates upon which the notices were delivered, and the entry, certificate or certificates are proof, in the absence of evidence to the contrary, of the delivery. R.S.O. 1990, c. A.31, s. 31 (1); 1997, c. 5, s. 20; 1997, c. 43, Sched. G, s. 18 (23); 2004, c. 7, s. 4 (1); 2006, c. 33, Sched. A, 21 (1-3).

37The Town as the new owner of the golf course lands also had a responsibility to ensure the integrity of the roll. There is no evidence that the Town took any steps after the conveyance to ensure that the roll was changed.

38There are still appeals outstanding for the taxation years on either side of the taxation years for which the palpable error correction is sought. There is no evidence to suggest that AMI is responsible for the delay in the hearing of the appeals for 2003 or 2008 or for the delay in the exchange of productions which revealed the palpable errors. These facts have been considered by the Board in making its decision to exercise its discretion more than 10 years after the error was first made.

39The Board is satisfied on the evidence before it that the unfairness to AMI in being billed for taxes for four years on the golf course property that was conveyed to the Town outweighs the prejudice to the other taxpayers of the Town. In the Board’s view it is extremely prejudicial to the taxpayer to refuse to exercise its discretion to correct the error. The Town has collected taxes from AMI on a property the Town owns for four years. (2004-2007).

40The Town filed the affidavit of Erica Roberts (Exhibit 3) which claims extreme prejudice but does not estimate the dollar amount that the town will be prejudiced by or the magnitude of the refund in terms of the total taxes collected by the Town.

41MPAC claims prejudice in having to go back over 10 years in its records to prepare for new appeals. There is no evidence that MPAC is unable to do so and the fact that appeals are still open for taxation years 2003 and 2008 weakens this argument.

42The Board does not accept the argument of MPAC that the current value should not be revisited but rather the returned value be reapportioned. The Board is of the view that it would be extremely prejudicial to the taxpayer to impose this limitation.

43The Superior Court of Justice (Divisional Court) in the case Montevallo found the discretion given to the Board in s. 40(1)(b) is not only the discretion whether to direct MPAC to being an appeal but also a discretion as to whether the assessed values should be altered or simply apportioned. The Divisional Court found that in giving the Board discretion in the exercise of its power the Board is entitled to decide the issues to be raised in the appeal.

44On the facts before it the Board is of the view that the correction of the palpable errors requires a determination of the current value of the property and a determination as to whether the classification is correct and is not prepared to exercise its discretion to require the assessment to simply be apportioned.

45The facts of this case are distinguished from the Montevallo case. In Montavello the restriction was imposed to protect the taxpayer from a higher assessment while in this case it appears that an apportionment of the assessment as returned would require the AMI to pay taxes on an assessment that exceeds the property’s current value. Mr. Francis submits that there is no issue with classification however the Board did not receive any evidence to confirm this to be the case.