Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: December 14, 2016

FILE NO.: RRD 2016M14

Assessed Person(s): Westpen Properties Ltd.

Appellant(s): Westpen Properties Ltd. c/o Bentall Kennedy (Canada)

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

Respondent(s): Town of Milton

Property Location(s): Nipissing Road Con 3 NS PT LOT 13 RP

Municipality(ies): Town of Milton

Roll Number(s): 2409-010-002-69010-0000

Appeal Number(s): 3094475 and 3154376 (deemed 2016 appeal)

Taxation Year(s): 2015 and 2016 (deemed appeal)

Hearing Event No.: 617430

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

Request by: MPAC (“Requester”)

Request for: A review of the Board’s Decision (WR 138939) issued on April 12, 2016

Heard: By written submission

DECISION OF THE BOARD DELIVERED BY PAUL MULDOON

INTRODUCTION

1MPAC (the “Requester”) seeks a request for review of the decision of the Assessment Review Board (“Board”) (WR 138939) by Member Sonia Light issued on April 12, 2016. This request for review was filed with the Board on May 10, 2016.

2The issue before the Board at the hearing was whether the assessment of the property at Nipissing Road, Con 3 NS PT LOT 13 RP (the “subject property”) as returned at $989,000 for the 2015 and 2016 taxation years was at current value and equitable with similar properties in the vicinity. The Board returned the property’s assessed values at $806,387 for the 2015 and 2016 taxation years and then reduced this value to $580,599 based on equity considerations. MPAC recommended a current value assessment of $1,061,035 and no adjustment for equity.

3In its request for review, MPAC submits that the Board erred in its equity analysis and requests a rehearing.

RELEVANT RULES

4Rules 141 to 146 of the Board’s Rules of Practice and Procedure (the “Rules”) set out the process whereby the Board may review a decision.

5A request for review is received pursuant to Rule 144 which grants the Board with the following authority:

144. Receipt of Request for Review

(1) Where a request for review has been received, the Board may:

(a) seek written submissions from the parties on the issue raised in the request;

(b) grant a motion to argue the question;

(c) grant a re-hearing without a motion; or

(d) confirm, vary, suspend or cancel the decision.

(2) The Board will determine initially whether the request has met one or more of the eligible grounds for such a review without providing notice to the other parties. The Board may review or grant a motion request without submissions from other parties.

6The Associate Chair may exercise discretion to grant a request and order a rehearing or a motion to review only if the Associate Chair is satisfied that the request for review raises a convincing and compelling case falling within the narrow grounds of Rule 145. As stated in Rule 145:

145. Grounds for Review

(1) The Board may consider reviewing its decision if the grounds for the request raise a convincing and compelling case that the Board:

(a) acted outside its jurisdiction;

(b) violated the rules of natural justice or procedural fairness, including allegations of bias;

(c) made an error of law or fact such that the Board would likely have reached a different decision;

(d) should consider new evidence, which was not available at the time of the hearing, but that is credible and could have affected the result; or

(e) heard false or misleading evidence from a party or witness, which was discovered only after the hearing and could have affected the result.

ISSUE AND ORDER SOUGHT

7The Requester seeks a review of the Board’s decision (WR 138939) pursuant to Rule 145(1)(c). The Requester submits that the Board erred in law by limiting its equity analysis to properties within the same municipal boundaries as the subject property.

8The Requester seeks a rehearing under Rule 144(c).

DISCUSSION AND REASONS

9MPAC is not challenging the Board’s finding on current value in its request for review. Instead, MPAC is challenging the Board’s equity analysis.

10The only issue in this request for review is a question of law: did the Board err in its interpretation of the meaning of vicinity in the context of s. 44(3)(b) of the Assessment Act:

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.

11The Board held that several properties suggested by MPAC for the equity analysis were unsuitable for that purpose because they were located outside of municipal boundaries.

12MPAC’s equity analysis, introduced through the testimony of Biagio Galle, demonstrates a median time adjusted Assessment to Sales Ratio (“ASR”) of 1.01 and supports a finding that similar properties in the vicinity are being assessed in an equitable manner. However, in cross-examination, Mr. Galle agreed that the analysis contained many properties that were not located in the Town of Milton and were actually in the nearby municipalities of Burlington and Oakville. The Board considered the analysis flawed stating that it did not meet the legislative test as being a reflection of similar properties “in the vicinity” of the subject property.

13In its request for review, MPAC submits the Divisional Court decision Irber Holdings Ltd. v. Municipal Property Assessment Corp., Region No. 09., 2012 ONSC 2129, [2012] O.J. No. 3874; 2012 ONSC 2129. This decision is binding on the Board and states:

[26] It is overtly reasonable that similar properties bear a similar level of municipal taxes and that inequities in assessment be reduced to the lesser. This result is within s. 44(3)(b) of the Assessment Act. However, in my view, s. 44(3)(b) is broader. It speaks of inequity of assessment with the scope of the assessment mandate extra-municipal. That mandate being all similar properties are to bear similar current values - subject to adjustment every 4 years. So that on those rare occasions when sufficient similar properties cannot be found, to the satisfaction of the Board, within the appellants' municipality, the comparison is, as here, extra-municipal.

14MPAC submits that the Board’s narrow interpretation of the word “vicinity” was inconsistent with the Divisional Court’s interpretation. MPAC further submits that this is an error of law that likely caused the Board to reach a different conclusion from that if the Board had not erred.

15Mr. Colin Francis of Altus Group Tax Consulting has submitted a response to MPAC’s request for review on behalf of Westpen Properties Inc. (the “Appellant”). Mr. Francis submits that the Board has broad discretion in identifying comparable properties and that the Board’s rejection of comparable properties suggested by MPAC for equity analysis on the basis that they are outside of municipal boundaries is not an error of law but an exercise of the Board’s discretion.

16The Divisional Court was clear in Irber Holdings that the word vicinity is not limited within municipal boundaries in the context of equity. Therefore, excluding comparable properties for an equity analysis solely due to them being outside of municipal boundaries would not be a correct exercise of the Board’s discretion.

17MPAC has requested a rehearing under s. 144(c); however, the alternative outcomes are sufficiently clear and distinct that this issue can be more efficiently dealt with under s. 144(d).

ORDER

18The Associate Chair finds that the Requester raises a convincing and compelling case that the Board may have made an error of law or fact such that the Board would likely have reached a different decision. The Associate Chair grants MPAC’s request for review and finds that the Board’s equity adjustment should be reversed. The ASR of 1.01 submitted by MPAC is accepted and an equity correction is not necessary. The assessed value of the subject property is $806,387.