Nicholas Phardis v. Municipal Property Assessment Corporation, 2016 CanLII 45379

Assessment Review Board / Commission de révision de l’évaluation foncière

ISSUE DATE: July 14, 2016

FILE NO.: WR 140592

Assessed Person(s): Nicholas Phardis

Appellant(s): Nicholas Phardis

Respondent(s): Municipal Property Assessment Corporation ("MPAC") Region 09

Respondent(s): City of Toronto

Property Location(s): 1038 Coxwell Avenue

Municipality(ies): City of Toronto

Roll Number(s): 1906-024-250-02650-0000

Appeal Number(s): 3120304, 3142748, 3142749 and 3149119 (deemed 2016 appeal)

Taxation Year(s): 2013, 2014, 2015 and 2016 (deemed appeal)

Hearing Event No.: 607129

Legislative Authority: Sections 33 and 40 of the Assessment Act, R.S.O. 1990, c. A.31, as amended

Heard: April 5, 2016 in Toronto, Ontario

APPEARANCES:

Parties	Representative
Nicholas Phardis	Self-represented
MPAC	Greg Tom
City of Toronto	No one appeared

DECISION OF THE BOARD DELIVERED BY MARGARITA OKHOVATI

INTRODUCTION

Preliminary Matter

1This matter before the Assessment Review Board (the "Board") concerns three appeals under s. 34 of the Assessment Act (the "Act") (supplementary assessments) for taxation years 2013, 2014 and 2015 by the Assessed Person, Nicholas Phardis, (the "Appellant") regarding the subject property at 1038 Coxwell Avenue in the City of Toronto. Each appeal has an assessed value of $60,000.

Table 1

Appeal Number	Taxation Year	Appeal Section Number	Assessed Value
3120304	2013	34	$60,000
3142748	2014	34	$60,000
3142749	2015	34	$60,000

2At the commencement of the hearing it was determined that the matter should be concerning two s. 33 omitted assessment appeals for the 2013 and 2014 taxation years and one s. 40 annual assessment appeal for the 2015 taxation year. The error stems from the initial filing of the 2013 taxation year appeal. The Board will correct its administrative errors and reflect the correct appeal information as follows in Table 2 below:

Table 2

Appeal Number	Taxation Year	Appeal Section Number	Assessed Value
3120304	2013	33	$60,000
3142748	2014	33	$60,000
3142749	2015	40	$346,000

3The matter before the Board therefore, is appeals of omitted assessments for the 2013 and 2014 taxation years and of the annual assessment for the 2015 taxation year by the Assessed Person, Nicholas Phardis, regarding the subject property at 1038 Coxwell Avenue in the City of Toronto.

Background

4The subject property is a 1,536 square foot ("sq. ft.") two-storey building. The first floor is a retail store with a residential unit on the second floor that was added incrementally to the original building during the period between 2013 and late 2015. It has a frontage of 16.7 feet ("ft.") and depth of 110.01 ft. (Exhibit 1).

5Prior to the commencement of the hearing, Greg Tom, representing MPAC, stated that the parties have agreed jointly that the omitted assessments under s. 33 for the 2013 and 2014 taxation years has to be 0.

6Consequently, both parties submitted further that the only outstanding issue for the Board's determination is the current value of the subject property of $346,000 for 2015 taxation year under s. 40 of the Act.

ISSUE

7In addition to the 2013 and 2014 omitted assessments agreed by the parties to have been assessed prematurely, the Appellant maintains that certain construction aspects to the second floor remained outstanding until December 2015, at which point an electrical inspection indicated compliance with the regulatory requirements. Consequently, he objects to the annual assessment of $346,000 for the 2015 taxation year.

8The Board has to decide:

• the subject property's current value assessment for the 2015 taxation year; and
• whether that value is equitable with the assessments of similar lands in the vicinity.

DECISION

9The Board having determined the current value to be $346,000 and having found that an equity adjustment is not required, confirms the assessment for the subject property at $346,000 for the 2015 and deemed 2016 taxation years.

10With the consent of the parties, the Board reduces the current value of the subject property under s. 33 from $60,000 to 0 for the 2013 and 2014 taxation years.

REASONS FOR DECISION

The Legislation

11In determining the value at which land shall be assessed, the Board must have regard to the following provisions of the Act.

12Section 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.

13Section 19.(1) of the Act states:

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

14Section 19.2(1) of the Act states:

Valuation days

19.2 (1) 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.

Exception

(5) Subsection (1) does not apply in respect of the valuation of land for a taxation year after 2004 if the Minister prescribes a different day as of which land is valued for that year.

15Section 44.(3) 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.

16Section 33(1) states:

Change re land omitted from tax roll

33. (1) The following rules apply if land liable to assessment has been in whole or in part omitted from the tax roll for the current year or for all or part of either or both of the last two preceding years, and no taxes have been levied for the assessment omitted:

34. The assessment corporation shall make any assessment necessary to correct the omission.

35. If the land is located in a municipality, the clerk of the municipality shall alter the tax roll upon receiving notice of the change, and the municipality shall levy and collect the taxes that would have been payable if the assessment had not been omitted.

36. If the land is located in non-municipal territory, the Minister shall alter the tax roll upon receiving notice of the change, and shall collect the taxes that would have been payable if the assessment had not been omitted

17Sections 36.(1) of the Act provides:

36.(1) Time for annual assessment and return of roll Assessment. - Except as provided in section 32, 33 or 34, assessments of land under this Act shall be made annually at any time between January 1 and the second Tuesday following December 1.

Current Value

MPAC's Position

18In support of current value, MPAC presented Exhibit 1, which contains photographs of the subject property dated 2009 and 2012 to 2014 and a market analysis of six suggested comparables.

19MPAC testified that in 2013, the addition of the subject property came to the attention of the City. The City Inspector inspected the property from outside. In 2014, the subject property was inspected externally again. At this time, the second floor addition appeared complete. In an attempt to arrange for an internal inspection, MPAC tried without success to contact the owner twice, leaving a contact telephone number.

20MPAC stated that a Request for Reconsideration was received in 2015 and was informed by the Appellant that the building was still incomplete.

21Mr. Tom testified that he requested an internal inspection again in September 2015 but this request was denied as well. He stated that at one point he suggested many dates and times to the Appellant and even told him that he was available for one whole week but the Appellant did not accommodate his request.

22Additionally, Mr. Tom testified that although internal inspection was denied several times, it is apparent that the addition of the second floor existed since 2013, based on the photographs submitted in Exhibit 1. He stated that he was satisfied that some internal work was still going on during 2013 and 2014 and therefore, he agreed to remove the omitted assessment for those two years.

23He testified further that once the structure of a building is complete, the value of the building increases and that MPAC cannot do a partial assessment. Therefore, the total assessment of the subject property has to be $346,000 for the 2015 taxation year.

Appellant's Position

24In presenting his case, Mr. Phardis submitted Exhibit 2, consisting of a letter from Electrical Safety Authority and invoices dated 2015 regarding some construction materials of the building.

25He submitted no evidence in the form of comparable properties.

26Mr. Phardis testified that he was in agreement with MPAC regarding the removal of the omitted assessment for the 2013 and 2014 taxation years. However, in his opinion, the current value of the subject property has to be $286,000 ($346,000 less $60,000) because, although the interior work was done in stages, like the walls in 2014 and the floor in August 2015, the second floor was not useable because the electrical wiring was not complete until December 2015 and the power was turned on, on December 21, 2015 (Exhibit 2).

27In response to MPAC's question whether he had any work orders, the Appellant stated that he did not because he did most of the electrical job and his brother and friends helped him to finish the construction.

28Mr. Phardis testified that he denied all the requests for internal inspection because the offered times and dates by MPAC did not fit in his schedule. He stated that he informed MPAC that he was available only after 6 p.m. but MPAC refused it by stating that he finished work at 4 p.m.

29No other evidence was presented by the Appellant.

Analysis and Findings

Current Value

30The Board must rely on the evidence submitted, which it finds to be reliable, in order to make a fair and transparent decision. In this case, the Board relies more on MPAC's evidence for the following reasons.

31MPAC testified that several requests for inspection were denied by the Appellant because he could not find a date or time before 6 p.m. The Board is not satisfied with the Appellant's explanation in this regard. Firstly, it is unreasonable to think that the Appellant was unable to accommodate MPAC's requests considering he suggested many different dates and times. Secondly, based on the Appellant's testimony when he stated that most of the construction work was done by him, his brother and friends, it is reasonable to think that one of them could have been present on the site in different times.

32Consequently, the Board draws a negative inference from the Appellant's denial of an inspection to MPAC. The Board concludes, from this, and because of the absence of a meaningful total of invoices dated in 2015 for materials and/or supplies being introduced into evidence by the Appellant, on the balance of probability, that construction of the second floor addition was substantially complete by the second Tuesday following December 1, 2014. That is the statutory date for the return of the tax roll for 2015 taxation, as set out in s. 36.(1) of the Act, and establishes the date at which the state and condition of properties is to be valued in January 1, 2012 terms.

33The Board finds MPAC's statement that the structure of the second floor in the subject property existed since mid-2013 and that an addition can be properly assessed whether or not it has commenced to be used for any purpose, to be most compelling. It is the Board's view that MPAC acted reasonably by removing the omitted assessment for the 2013 and 2014 taxation years although the second floor structure existed since 2013 and the interior features were in process of being finished.

34Furthermore, MPAC introduced a total of six properties for comparative purposes (Exhibit 1). The comparable properties used for the purpose of determining current value need not be identical. They only have to have sufficient similarity so that reasonable comparisons can be made with the subject properties so that adjustments for size, age, location, condition and overall character can be applied.

35Although MPAC did not rely on the suggested comparables orally nevertheless, the Board has considered them and notes the following:

a) All six comparable sales occurred in 2011 and 2012, which is in the period or in proximity of the assessment period of January 1, 2012 valuation date.

b) The average sale price per sq. ft. of the six suggested comparables is $247.92 which is significantly higher than the total current value assessment of the subject property, inclusive of the $60,000 added value, of $225.26 per sq. ft. ($346,000/1,536 sq. ft.)

c) The average time adjusted sale price per sq. ft. of the six suggested comparables is even higher at $249.66. When this is applied to the subject property, the result is $383,477 or $384,000 rounded; a value also exceeding the subject's total assessment of $346,000.

Equity

36The Act requires the Board to lower an assessment below its current value if such an adjustment is required to make the assessment equitable with the assessment of similar properties in the vicinity.

37Section 44.(3)(b) of the Act states that the Board shall "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 the similar lands in the vicinity if such an adjustment would result in a reduction of the assessment of land."

38The Board has not been presented with any evidence to suggest that the current value of the subject property of $346,000 requires a further adjustment in accordance with s. 44.(3)(b) of the Act.

CONCLUSION

39Based on the totality of the evidence, the Board determined the current value of the subject property to be $346,000 for the 2015 and deemed 2016 taxation years. The Board finds this value to be fair and equitable.

40The Board also reduces the current value of the subject property under s. 33 from $60,000 to 0 for the 2013 and 2014 taxation years.

2016 DEEMED APPEAL

1An appeal for the 2015 taxation year is presently before the Board. Section 40.(26) of the Assessment Act 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 2015 appeal before March 31, 2016. For that reason, this decision also applies to the 2016 taxation year.

2Section 40.(26) of the Act directs:

Deemed appeals, 2009 and subsequent years

(26) 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.