Cheshire v. Municipal Property Assessment Corporation, 2016 CanLII 80445

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

ISSUE DATE: November 17, 2016

FILE NO.: WR 142742

Assessed Person(s): William Bryce Cheshire Janet Louise Couch Mary Elizabeth Brough

Appellant(s): William Bryce Cheshire Janet Louise Couch

Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 25

Respondent(s): Town of South Bruce Peninsula

Property Location(s): 800 Frank Street

Municipality(ies): Town of South Bruce Peninsula

Roll Number(s): 4102-580-003-23000-0000

Appeal Number(s): 3118927 and 3159059

Taxation Year(s): 2015 and 2016

Hearing Event No.: 635306

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

Heard: August 22, 2016 in Port Elgin, Ontario

APPEARANCES:

Parties	Representative
William Cheshire	Self-represented
Janet Louise Couch Mary Elizabeth Brough	William Cheshire
MPAC	Mel Plater Jeff Weiler
Town of South Bruce Peninsula	No one appeared

DECISION OF THE BOARD DELIVERED BY LESLIE FLEMMING

INTRODUCTION

1The subject property is a parcel of approximately 6.0 acres in size located in the Town of South Bruce Peninsula on the shores of Colpoy Bay on Lake Huron. It has approximately 507 feet (“ft.”) of road frontage on Frank Street and approximately 550 ft. of water frontage. While on the easterly limits of the town, it has access to water and gas services and is approximately150 feet from the town’s sewer line. There are three potential building sites on the property as suggested by the Grey Sauble Conservation Authority. At present the property has a mixture of shrubs, trees and open area.

2The assessment was returned in the amount of $385,000 for the 2015 and 2016 taxation years. The Appellants contend that the value is excessive and argue that a more appropriate assessment would be “in the mid $200,000’s”. This property is classified residential; there is no dispute about the classification. In 2014, the Appellants appealed their assessment and entered into Minutes of Settlement agreeing to an assessment for that year of $290,000 (Exhibit 3 for the Appellants). The current appeals relate to the assessed value returned for 2015 and 2016.

ISSUE

3The Board must determine both the correct current value for the subject property and whether the assessment of the subject property is equitable with the assessments of similar properties in the vicinity of the subject property.

DECISION

4For the reasons stated below and as directed by s. 44.(3)(a) of the Assessment Act (“Act”), the Board finds that the current value of the subject property as at the valuation day, January 1, 2012, is $385,000.

5The Board finds also that there is no evidence before it leading to the conclusion that the current value of the subject property requires a further adjustment on the ground of equity as set out in s. 44.(3)(b) of the Act.

6Accordingly, the assessed value of $385,000 is confirmed as returned for 2015 and 2016.

REASONS FOR THE DECISION

7The best measure of current value is an arm’s length and market-tested sale of the subject property on or around the valuation day – January 1, 2012. If no such transaction took place, a further measure of current value is derived from the arm’s length and market-tested sales of comparable properties in the same vicinity and market. This measure acts as a benchmark and gauge of the correctness of the assessed value of the subject property. The burden of proof for establishing the correctness of value lies with MPAC.

8Section 44.(3)(a) of the Act requires the Board to first “determine the current value of the land.”

9Section 1 of the Act defines “current value as:

“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 provides:

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.

12Evidence for MPAC was presented by Mel Plater and Jeff Weiler. They presented six comparable properties, all vacant, although one property was sold with a structure in place which has since been removed. They compared each property from the perspective of water frontage, giving each a value per foot of frontage or “per front foot”.

13Mr. Weiler advised the Board that the subject property was combined with another property effective January 1, 2015, under the current roll number. Mr. Weiler testified that the current value of $385,000 is based on the value of the combined properties: Parcel 3-230, consisting of 3.5 acres and Parcel 3-235, consisting of 2.5 acres, together consisting of Parts 1, 2, 3, 4 and 5 of Plan 3R-1017. The Minutes of Settlement respecting the 2014 taxation year referred to Parcel 3-230 only.

14MPAC introduced evidence of six comparable vacant lands. Sales A and B reference properties sold in Wiarton in the Town of South Bruce Peninsula. Sales C and D are properties in the Town of South Bruce Peninsula. Sales E and F are properties located in the Township of Georgian Bluffs. All are in the vicinity and located on Colpoy’s Bay. Table A sets out the primary details provided with respect to each property sale.

TABLE A: COMPARABLE PROPERTIES

(“FF” = front foot)

Property	Sale Price	Sale Date	Area (acres)	Frontage (feet)	Price per FF
Subject Property	$385,000 (assessed)	n/a	6.0	550	$700
A - 895 Bayview	$401,222	2011/06	1.30	170	$2,360.12 (before removal of building)
B - 616 Frank Street	$1,110,000	2008/07	3.6	235	$4,723.40
C – Mallory Beach Rd.	$210,000	2009/07	.45	97	$2,165.61
D – Mallory Beach Road	$265,000	2015/04	.57	130	$2,038.46
E – 501177 Grey Rd. 1	$212,500	2012/02	1.66	132	$1,609.84
F - Old Mill Road	$162,000	2015/11	1.29	120	$1,350.00

15The properties all share the inclusion of waterfront, but are quite dissimilar in many respects. Sale A, considered by MPAC to be inferior to the subject property, is a much smaller property. Sale B is considered superior due to its development potential. Sale C is separated from the waterfront by a road and is just under a half an acre in size. Sale D is just over half an acre in size. Sale E has since been improved by the addition of a garage and is also the site of a 245 sq. ft. cabin built in 1940. The sale price shown includes the cabin but not the garage, built after the fact. Sale F is again a much smaller parcel and has a road separating the property from the waterfront.

16MPAC concludes that these comparable property sales, while occurring over a span of almost eight years, indicate that the subject property assessment is accurate. The property is larger than all the comparable properties and has more waterfront than all six examples. The evidence given by MPAC is that the Grey Sauble Conservation Authority has approved three building sites on the six-acre lot, which, if sold at $200,000 a piece, would give a total value of the current parcel of $600,000. Mr. Plater concludes that the average value per front foot of waterfront land in the area is $2,374, which, if applied to the subject property, would result in an overall value of $1,305,700. MPAC argues that this evidence supports the current assessment as being fair and reasonable.

17Mr. Cheshire testified on behalf of the Appellants. He testified that the property has a number of limitations that have not been taken into consideration, including:

• There is an aboriginal land claim affecting lands that are part of a road allowance bisecting the property;

• The Conservation Authority would like to carry out a “wave uprush” study on the property;

• The sewer lines are over 100 feet away from the property line, which would require a significant investment on the part of a builder to connect any residential building to the town sewer system, meaning that septic service is the most practical but less desirable alternative;

• The property has been offered for sale by the Appellants for amounts ranging between $1,000,000 and, more recently, $575,000, with no buyer interest, over the last three years.

• The Grey Sauble Conservation Authority has approved only one building site, not three.

• The shoreline is comprised of a steep slope which he described as a “cliff” of at least a 45% grade.

18Mr. Cheshire did not provide any comparable sales with the exception of a property located at 848 Frank Street, Wiarton. He provided a Geowarehouse print-out, Exhibit 4, indicating that this parcel, classified as Industrial land sold in 2014 for $120,000 and has an assessed value of $94,000. The property is 1.37 acres in size.

19Exhibit 2 for the Appellant also contained aerial photographs of Sales E and F as provided by MPAC, plus photographs and listing information regarding 501175 Grey Road 1, Wiarton. This is a vacant waterfront property of 1.63 acres which was offered for sale for $212,000. No evidence of a completed sale was provided.

Analysis

20In weighing the factors that affect value, the Board must be conscious of the effect of the factors on the potential purchaser of the subject property in an arm’s length transaction. In this case, the issues surrounding this property as enumerated by Mr. Cheshire, may be resolved through one or more steps which provide an expense to the Appellants or subsequent purchasers, but which do not provide an insurmountable or long-term impact on the value of the land. While the Appellants referred to the problems ahead of them in respect of the sewer issue, the land claim related to an abutting property, and the potential impact of the involvement of the Conservation Authority, they failed to provide the Board with an indication of the cost of these factors. As a result, the Board is unable to adjust the value of the property based on potential future costs to correct the problems. Mr. Cheshire also spoke about the steep grade between the potential building site and the shore, but offered no evidence of the length of the grade from the top of the rise to the shore, or the number of linear feet of shoreline abutting the steep slope. No photographs and no indication of the affect of this slope on potential purchasers or occupiers of the lands were offered. Mr. Cheshire offered insufficient evidence to rebut the reasonableness of the property’s assessment, a reasonableness which the current listing price of the subject property corroborates.

21The comparable sale of 848 Frank Street in Wiarton is not useful as the classification is industrial, not residential and the property is much smaller than the subject property. If the classification were residential, this sale would serve to confirm the reasonableness of the subject property’s assessment as returned.

22The current value of the subject property is therefore confirmed in the amount of $385,000 for 2015 and 2016.

Equity

23Once the Board has determined the current value of the land, it is required by s. 44.(3)(b) of the Act to:

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.

24Neither party introduced evidence relating to the assessed values of similar lands in the vicinity.

25The Board finds that, in the absence of evidence relating to the values at which similar lands in the vicinity have been assessed, the Board will not make an adjustment to the current value.

CONCLUSION

26The Board determines that the current value of the subject property is $385,000.

27The Board finds that there is no evidence before it supporting the conclusion that the value of the subject property requires an adjustment in accordance with s. 44. (3)(a) of the Act.

28Accordingly, the assessment of $385,000 is confirmed as returned for 2015 and 2016 taxation years.