Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: September 1, 2016 FILE NO.: WR 141543

Assessed Person(s): Silwell Developments Limited Appellant(s): Silwell Developments Limited c/o Metrontario Investments Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 15 Respondent(s): Town of Oakville

Property Location(s): Oak Walk Drive Municipality(ies): Town of Oakville Roll Number(s): 2401-010-030-06885-0000 Appeal Number(s): 2963163, 3033026, 3086886 and 3154784 (deemed 2016 appeal) Taxation Year(s): 2013, 2014, 2015 and 2016 (deemed appeal) Hearing Event No.: 629866

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

Heard: July 07, 2016 in Oakville, Ontario

APPEARANCES:

Parties	Counsel+/Representative
Silwell Developments Limited	Lucie Sinopoli
MPAC	Raj Rakhra
Town of Oakville	Susan Price

DECISION OF THE BOARD DELIVERED BY TYRONE D. SKANES

INTRODUCTION

1The 2013, 2014, 2015 and 2016 taxation year appeals before the Assessment Review Board ("Board") is in respect of the assessment of an un-serviced 1.09 acre vacant lot located in Oakville.

2Raj Rakhra, representing MPAC, stated that he used the Direct Comparison Sales Approach to arrive at the returned assessment of $3,182,000 for the subject property ("SP"). He submitted that MPAC's four sales comparables support the returned assessment and requested the Board confirm it at that value.

3Lucie Sinopoli, representing the Appellant, stated that MPAC's assessment was too high. She did not present any sales evidence to support her position but stressed that the SP's returned assessment was inequitable with similar lands in the vicinity and asked the Board to reduce the assessment to a value no higher than $2,101,000.

ISSUE

4The issue before the Board for determination is whether the assessment of the SP for the 2013, 2014, 2015 and 2016 taxation years is at current value and whether it is equitable with the assessment of similar lands in the vicinity.

DECISION

5The Board is required by s. 44.(3)(a) and (b) of the Assessment Act (“Act”) to determine the current value of the land and have reference to the value at which similar lands in the vicinity are assessed and adjust the assessment 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.

6The Board finds that the current value of the SP as of January 1, 2012, is $12,832,000. However, the Board finds that this value is inequitable with the assessments of similar lands in the vicinity and therefore reduces the returned assessment from $3,182,000 to $2,680,000 for the 2013, 2014, 2015 and 2016 taxation years.

REASONS FOR DECISION

Relevant Legislation

7Section 19.(1) of the Act states:

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

8Section 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.

9Section 19.2(1)3 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.

10Section 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.

11Section 40.(19) of the Act states:

40.(19) Board to make determination. – After hearing the evidence and the submissions of the parties, the Board shall determine the matter.

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.

MPAC's Position and Evidence

13Mr. Rakhra's valuation report was entered into evidence as Exhibit 1. He entered four comparable properties for the Board's consideration. All are vacant lots of varying sizes and two are located some distance from the SP.

14Mr. Rakhra asked the Board to find that the assessment as returned at $3,182,000 was fair and reasonable and to confirm it at that value.

15On cross-examination Mr. Rakhra stated that:

• MPAC's four sales comparables are located near Dundas Street;

• He did not know the how far the most distant sale comparables was located from the SP;

• Two sales comparables are located near the waterfront but could not speculate if that factor would add value to the properties.

Appellant's Position and Evidence

16Ms. Sinopoli entered a documentary package into evidence as Exhibit 2. She did not enter any comparable sales into evidence, advising that she could not locate any recent comparable sales within a five kilometer radius of the SP. She said that she was focusing her argument on what she believed to be an equity imbalance and referred to Schedule "A" of Exhibit 2. There were a number of properties that she said clearly demonstrated that the SP was over assessed and asked the Board to reduce the assessment to a value of no more than $2,101,000.

17Ms. Sinopoli pointed out that the 2008 assessment was only $790,000 and the current assessment of $3,182,000 represented a significant increase for which there seemed to be no basis. She also noted that despite the Robinson Street and Water Street properties being substantially smaller than the SP, their December 2012 sales prices were significantly higher than the May 2012 sale of the property located at Old Mill Road, which is not near the water and whose lot is substantially larger.

18Ms. Sinopoli completed her presentation by stating that there are no immediate plans for developing the SP and no permits have been applied for by the developer.

19On cross-examination Mr. Rakhra asked Ms. Sinopoli why she had not used any sales comparables and she replied that she could not find any relevant sales within a five kilometer radius of the SP. Mr. Rakhra questioned Ms. Sinopoli about some of the properties she used in Schedule "A" and asked if she was aware that some of them were currently being developed as townhouses and she replied that as of the valuation date they were still vacant lands. Ms. Price asked Ms. Sinopoli if she was aware that some of the properties in Schedule "A" had been developed and were being lived in and Ms. Sinopoli replied that she was unaware of this.

20Ms. Sinopoli submitted three decisions that dealt with an equity imbalance and used the assessment per square foot of similar lands in the vicinity to make an equity finding. Those decisions are:

• Schumacher v. Municipal Property Assessment Corp., Region No. 14 [2013] Board File No. WR 120736, before Board Member B. Cowan, regarding equity evidence.

• Municipal Property Assessment Corp., Region No. 14 [2013] v. Schumacher [2015] O.A.R.B.D. No. 73 (“Schumacher”) (Board File No. DM 2014M8), before Board Member J. Wyger, regarding equity evidence.

• Municipal Property Assessment Corp., Region No. 14 [2013] v. Schumacher [2016] O.N.S.C. 3239 Divisional Court File No.: DM3-00626-00, regarding equity evidence.

21Ms. Sinopoli closed her presentation by asking the Board to reduce the assessment to $2,101,000.

Board's Deliberations - Current Value

22The best evidence of current value is the sale of the SP, if the sale meets the definition of current value on or near the valuation day. When no such sale occurs, as in this instance, the Board looks to the sale of similar properties in the vicinity to determine current value.

23The Board has carefully considered the testimony of the parties and the documentary evidence tendered as exhibits.

24The Board, when comparing properties, does not expect exactness or sameness. Therefore, the Board looks at similarity of characteristics, amenities and location to determine comparability.

25The Board usually considers sales of comparable properties that have occurred within one year on either side of the valuation date as the ideal time period for consideration.

26MPAC submitted four sales for the Board's consideration, all of which occurred within the ideal time period. All are vacant lands located outside of the SP's homogeneous neighbourhood. These properties are listed in Table 1 below:

Table 1

Property	Lot Size Square Foot	Sale Price	Sale Price Per Square Foot
SP	45,996	N/A	N/A
1	97,776	$14,000,000	$143
2	16,988	$1,000,000	$59
3	12,173	$5,525,000	$454
4	5,371	$2,975,000	$554
Median			$256
Mean			$302
Average Central Tendency = (Median + Mean) ÷ 2			$279

27All of the comparable properties are located south of the Queen Elizabeth Highway, while the SP is located near the intersection of Dundas Street and Trafalgar Road. Properties 3 and 4 are in close proximity to the Lake Ontario waterfront.

28There are significant differences between the SP and the comparable properties lot sizes, which makes a direct comparison difficult. However, the Board is not responsible for the poor quality of the evidence placed before it. The Board must deal with the evidence it has in determining current value and whether it is equitable with the assessments of similar lands in the vicinity.

29The Appellant asked the Board to not consider MPAC's comparable properties as they were too great a distance from the SP and two of them were in proximity to the waterfront and would command a higher sales price due to that factor.

30The Appellant did not enter any sales evidence to counter that submitted by MPAC. The Appellant also did not submit any evidence to prove its assertion that waterfront properties command a higher sales price, owing to their proximity to water. This may very well be so but believing something and proving it are two altogether different things. Therefore, in determining current value the Board only has MPAC's evidence, poor though it may be, and will consider all four comparable properties.

The Appellant also highlighted the significant increase from the 2008 assessed value to the 2012 assessed value. While the Board recognizes the Appellant’s concern over the increase there is nothing in the Act which requires there to be a correlation between assessments from one valuation period to another.

31The Board determined that the average of the Central Tendency Indicators (Median and Mean) price per square foot of the comparable properties is $279. Applying this per square foot value to the SP's total square footage of 45,996 returns a value of $12,832,884. The Board therefore finds the SP's current value to be $12,832,000 (rounded).

Board's Deliberations – Equity

32Section 44.(3)(b) of the Act directs that once the Board has determined current value it must have reference to the value at which similar lands in the vicinity are assessed and if necessary adjust the assessment of the land for equity purposes, if such an adjustment would result in a reduction of that assessment.

33MPAC did not present any equity evidence. While the burden of proof in this regard rests with the Appellant, it is the Board that must make the determination and what evidence it will use in determining if an adjustment is required.

34The Board determines that the vicinity in this instance to be the Oakville municipality. None of the properties in Schedule "A" had recent sales and the Board is therefore unable to conduct an Assessment to Sales Ratio ("ASR") analysis using the Schedule "A" properties. The only ASR data available to assist the Board in its equity reference to similar lands in the vicinity is MPAC's four comparables. The Board considered using that data in its equity analysis but rejected it because the Board is of the view that an analysis of the assessment per square foot of all 14 comparables (Schedule A comparables and MPAC's sales comparables) is the best equity evidence. The Board finds that using assessment per square foot in its equity analysis troubling but again, the Board has to deal with evidence before it. The Board would have preferred to use several properties (more than 4) that had recent sales so that an ASR analysis could have been conducted but the parties failed to provide this evidence.

35Both the MPAC assessor and municipal representative challenged some of the properties entered into evidence by the Appellant, in Exhibit 2, Schedule "A", as having already been developed. However, neither party identified which lands they were referencing, therefore, the Board will utilize all of the properties in Schedule "A". The Board notes that none of the comparable properties entered by MPAC were included in the Appellant's submission. The Board will therefore use those four properties in its equity analysis. The properties are listed in Table 2 below:

Table 2

Property	Lot Size Square Foot	Assessment	Assessment Per Square Foot
2466 Trafalgar Road	87,120	$4,331,000	$49.71
Dundas St.	129,416	$4,775,000	$36.90
George Savage Way	85,595	$3,906,000	$45.63
Taunton Road	24,524	$1,077,000	$43.92
Taunton Road	29,577	$1,308,000	$44.22
Taunton Road	24,698	$1,096,000	$44.38
Baronwood Drive	114,562	$4,226,000	$36.89
2441 Greenwich Drive	79,714	$3,843,000	$48.21
2478-2490 Old Bronte Road	122,403	$4,515,000	$36.89
2390 Khalsa Gate	106,286	$4,014,000	$37.77
Lyons Lane (MPAC)	97,776	$10,740,000	$109.84
Old Mill Road (MPAC)	16,988	$1,329,000	$78.23
Robinson Street (MPAC)	12,173	$4,251,000	$349.22
Water Street (MPAC)	5,371	$1,821,000	$339.04
Median			$45.00
Mean			$92.92
Mode			$36.89
Average Central Tendency = (Median + Mean + Mode) ÷ 3			$58.27

36The Board finds that an adjustment for equity is required. By applying the average per square foot value of the Central Tendency Indicators (Median, Mean and Mode), $58.27 to the square footage of the SP at 45,996, it returns an equitable value of $2,680,186.90 or $2,680,000 (rounded).

CONCLUSION

37The Board finds the current value of the subject property to be $12,832,000. However, the Board finds that, after referencing the assessment of similar lands in the vicinity, the SP is inequitably assessed and an adjustment to the returned assessment is required. Consequently, the SP's returned assessment is reduced from $3,182,000 to $2,680,000 for the 2013, 2014, 2015 and 2016 taxation years.