Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: May 02, 2017

FILE NO.: WR 145142

Assessed Person(s): E. K

Applicant(s): E. M. L.

Respondent(s): City of Toronto

Property Location(s): Withheld

Municipality(ies): City of Toronto

Roll Number(s): Withheld

Application Number(s): 3045216

Taxation Year(s): 2013

Hearing Event No. 659065

Legislative Authority: Section 323(1)(e) of the City of Toronto Act, 2006, S.O. 2006, c. 11, Sched. A

Heard: January 9, 2017 in Toronto, Ontario

APPEARANCES:

Parties

Counsel⁺/Representative

E. M.

Self-represented

City of Toronto

J. Wehrle⁺ and Luis Verastegui

DECISION OF THE ASSESSMENT REVIEW BOARD DELIVERED by MARILYN SHARMA

1This appeal came before the Assessment Review Board (the “Board”) on January 9, 2017 in the City of Toronto (the “City”).

PRELIMINARY

2This matter previously came before the Board on November 25, 2015 and was adjourned because E. M. L. (the “Applicant”) had insufficient documentation to allow the hearing to proceed. The Applicant was therefore given additional time to obtain, compile and summarize all the documentation to support her appeal and to allow the Board to conduct a satisfactory hearing.

ISSUE

3The issue before the Board is to determine whether the Applicant’s property taxes for the taxation year 2013 should be cancelled, reduced or refunded because of the Applicant’s inability to pay taxes because of sickness or extreme poverty.

DECISION

4The Board finds that the Applicant meets the test of sickness. However, after examination of her financial situation in 2013, the Board further finds that the Applicant’s financial situation does not warrant any relief of her property taxes.

5Accordingly, the Board finds that the Applicant has failed to meet the tests required to qualify for relief set out in s. 323(1)(e) of the City of Toronto Act 2006, S.O. 2006 c. 11. Sch. A (“COTA”) regarding an inability to pay part or all of her taxes due to sickness or extreme poverty.

6The Board therefore dismisses the application for the cancellation, reduction or refund of taxes for the taxation year 2013 on the subject property located at ADDRESS WITHHELD.

REASONS FOR DECISION

7COTA states that “Upon application to the City treasurer made in accordance with this section, the City may cancel, reduce or refund all or part of the taxes levied on land in the year in respect of which the application is made, if the applicant is unable to pay taxes because of sickness or extreme poverty”. Hence a two part test must be applied. Firstly, the Board must determine if sickness or extreme poverty exists. If such is not the case, then the application fails. Secondly, if either is present the Applicant must demonstrate an inability to pay some or all of the taxes.

Sickness

8The Applicant presented a completed City of Toronto Form 2 – Doctor’s Statement. In this statement of November 6, 2014, the medical practitioner indicated that in her opinion the Applicant is unable to work because of sickness and will not be able to resume working.

9The Applicant also presented additional medical reports to support her inability to work because of sickness. The City did not dispute the Applicant’s sickness.

Inability to Pay Taxes

10In determining whether an applicant has the ability to pay part or all of her taxes due to sickness or extreme poverty, the Board is required to examine the evidence presented by the Applicant, as well as the overall financial situation (including, but not limited to, expenses and income) of the Applicant, and to assess after consideration of all the evidence, whether the Applicant was unable to meet all or part of her tax obligation.

Document Disclosure

11The Applicant filed a completed Form 1 – “Financial Information” which shows the various sources of income and the application of the income to the various categories of expenses incurred as well as information regarding assets and liabilities as follows:

Assets

12The Applicant owns a property located at ADDRESS WITHELD. As of the valuation date January 1, 2012 the assessed value of the property is $666,000.

• The Applicant stated that she owns a motor vehicle - a 2001 Pontiac Sunfire which is valued at approximately eight hundred ($800.00) dollars.

• The Applicant also noted on the Form 1 – Financial Information- that she has a checking account with a balance of approximately six hundred dollars ($600).

Sources of Income

13The Applicant provided in her Form 1 – Financial Information- the following sources of income for the taxation year 2013, and their respective monthly amounts as follows:

a. Canada Pension $585.60

b. Old Age Security $397.49

c. Private Pension $839.84

d. Rental Income $750.00

e. GST Credit $103.80.

f. Other Income $642.00

The total monthly income amounts to $3,318.73.

14The Applicant filed a Form 1 –“Financial Information” for the taxation year 2013 in which her monthly expenses are summarized as shown below:

Expenses:

Mortgage $ 2,010.99

Property Taxes $ 344.64

Home Insurance $ 158.67

Water $ 5.18

Heat $ 80.62

Hydro $ 165.23

Telephone/Cell $ 96.07

Meals Outside Home $ 66.10

Groceries $ 181.65

Transit $ 3.00

Gasoline $ 65.75

Car Plate Registration $ 6.83

Car Insurance $ 82.53

Car Repair & M’tce. $ 126.24

Medical $ 9.60

TOTAL $ 3,403.10

Value of Assets:

Real Estate – Assessed Value $666,000.00

Automobile $ 800.00

Cash in Hand $ 601.51

TOTAL $667,401.51

Value of Liabilities:

Scotia Mortgage ($ 431,747.75 + $63,362.96): $495,110.71

Credit Cards nil

Car Loan nil

TOTAL $495,110.71

15Based on the information provided by the Applicant, her net worth stands at $172,290.80.

Analysis

16The test under s. 323(e) of COTA refers to whether the Applicant is unable to pay her property taxes due to sickness or extreme poverty. In this case the Board accepts, on the basis of medical reports, that the Applicant is unable to work because of her sickness.

17The Board is of the view that COTA envisages that an individual seeking relief on application under s. 323(e) should clearly demonstrate that for the year under appeal the Applicant is unable to provide for the basic necessities of living and at the same time meet her obligations to pay some or all of her property taxes.

18In viewing an application under this section of the Act, the Board does not only look at the income and expenses of the Applicant but also looks at the full spectrum of the Applicant’s financial resources available and determine whether there was any opportunity that would allow her to mitigate her tax obligation.

19The Board has examined the financial information the Applicant filed in the Form 1 – Financial Information and highlights the following:

a. The Applicant included expenses for 2013 the amount of $281.35 per month for Gasoline, Repairs and Maintenance and Insurance for her automobile. Counsel for the City raised concerns that the Applicant is incurring this level of expenditure for an automobile that has a value of $800. In addition, Counsel questioned the Applicant’s priority in incurring this expense instead of paying her property taxes.

b. Counsel expressed severe concerns regarding the Bank Statements provided by the Applicant and questioned their authenticity because of the following:

i. The statements are void of any links or identification with any financial institution;

ii. The statements do not identify the owner of the account;

iii. It is not possible to verify whether the statements represent all the monthly transactions performed;

iv. The accuracy of the items listed cannot be verified;

v. Certain regular credits of significant value could not be satisfactorily explained;

c. Counsel requested the Applicant to explain the reasons for a regular and significant sum of monies being deposited into her account. Over the period January to December 2013, a total sum of $11,037.17 was deposited into her account.

d. The Applicant’s explanation of the monthly sums of the $11,037.17 deposited to her account was that it represented loans. The Board was not presented with any evidence to corroborate this statement. Further, the Board notes that the manner of the explanation given by the Applicant suggests that the sum of money represented several loans. This situation would therefore warrant several loan documentations for each loan and their respective details. The Applicant did not provide any documents to verify the existence of any loans.

e. Counsel drew to the Board’s attention that in the information provided by the Applicant pertaining to Credit Card expenditures, the Applicant made significant monthly payments in 2013 on the said account amounting to $6,082.08. The Applicant failed to provide copies of her credit card statements so that the City and the Board can determine the legitimacy of the various expenditures being incurred on her Credit Card to support her application for relief under s. 323(e) of COTA.

f. The Board notes that at the prior hearing of this application held on November 25, 2015 the Applicant was advised that the hearing was being adjourned to allow the Applicant time to obtain and present full and complete financial information including accurate and valid data to support her claim and to allow Counsel for the City as well as the Board to assess whether her application can be granted. The Board agrees with Counsel for the City that the Applicant failed to comply with the Board’s request despite being given sufficient time to obtain such information.

Board’s Summary and Findings

20The Board has reviewed and considered the arguments of the Applicant including all the evidence provided. Based on the Applicant’s evidence, the Board finds the following:

a. That the authenticity of the Applicant’s Bank Statements appears questionable and therefore places little weight on them.

b. That the Applicant has fully paid her property for the taxation year 2013 and is not in arrears for any prior or subsequent years.

c. That based on the Applicant’s Form 1 – Financial Information – the Applicant’s expenses exceed her income by $35.90 per month or $430.80 per year. The Board is of the view that this does not rise to the level of “extreme” poverty as envisaged in COTA.

d. That the monthly expenditure of $281.35 in 2013 to operate, license, insure and maintain an automobile for purely personal convenience should not take precedence over the payment of property taxes.

e. That the regular deposits of monies in the Applicant’s Bank Account in 2013 to be sizeable. The Board also notes that this sum of money was not recorded in the Applicant Form 1 – Financial Information filing. Further the Board cannot accept the less than satisfactory explanation advanced by the Applicant. The Board also finds that the sum of $11,037.17 would be sufficient to provide approximately three times coverage of the property taxes for the taxation year 2013.

f. The Applicant failed to provide adequate information regarding her credit card account. The Board has serious reservations about the lack of any information particularly in light of the fact that the Applicant made credit card payments of approximately $6,000 in 2013. The Board’s concerns are further exacerbated by the fact that these payments do not appear in the Applicant’s Form 1 – Financial Information filing.

g. That the Applicant did not provide full and complete information since the prior hearing in November 2015 was adjourned to specifically allow her to obtain, compile and submit adequate information to support her application. The Board finds the Applicant to be rather selective in the nature and extent of financial information she has provided. The Board rejects any suggestion by the Applicant that she has provided what she was requested to provide.

CONCLUSION

21The Board is of the view that the payment of property taxes remains one of the foremost obligations of all home owners and has examined the transactions within the various income and expenses statements provided by the Applicant. The Board, while it believes that sickness does exist, it is not persuaded that the Applicant, based on the financial information provided, has demonstrated that there exists an inability to pay part or all of her property taxes.

22The Board finds that the nature of payments listed for various non-essential goods and services, including significant car expeditures, do not demonstrate that the property taxes could not be paid in whole or in part.

23Accordingly, the Board finds that the Applicant has failed to meet the tests required to qualify for relief set out in s. 323(1)(e) of the City of Toronto Act 2006, S.O. 2006 c. 11. Sch. A regarding an inability to pay part or all of her taxes due to sickness or extreme poverty.

24The Board therefore dismisses the application for the cancellation, reduction or refund of taxes for the taxation year 2013 on the property located at ADDRESS WITHHELD.