Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: June 16, 2017

FILE NO.: WR 146992

Assessed Person(s): CSH Pleasant Rest Inc.

Appellant(s): CSH Pleasant Rest Inc. and Chartwell Seniors Housing

Respondent(s): Township of Champlain

Property Location(s): 428 Front Rd W

Municipality(ies): Township of Champlain

Roll Number(s): 0209-008-003-10400-0000

Appeal Number(s): 3056244

Taxation Year(s): 2013

Hearing Event No.: 678166

Legislative Authority: Section 357.(8) of the Municipal Act, 2001, S.O. 2001, c. 25, as amended

Heard: May 31, 2017 by telephone conference call

APPEARANCES:

Parties CSH Pleasant Rest Inc. and Chartwell Seniors Housing

Representative Alison Davis

Parties Township of Champlain

Representative No one appeared

DECISION OF THE BOARD DELIVERED BY SCOTT McANSH

INTRODUCTION

1CSH Pleasant Rest Inc. and Chartwell Seniors Housing (collectively “Chartwell”) seek a refund of the taxes paid for the 2013 taxation year because they were overcharged due to a gross or manifest error. The error was made by the Municipal Property Assessment Corporation (“MPAC”) in the assessed value applied to Chartwell’s property. For the 2013 taxation year, their property was assessed at $3,290,000. But for 2014 taxation, without an appeal or prodding from Chartwell, the assessment was reduced to $2,628,000.

2MPAC informed Chartwell that the reduction was due to factual errors that the assessment was based on, including the age of the building. Chartwell applied for a refund of the 2013 taxes to Township of Champlain (“Township”) in February 2014. The Township did not make a decision on that application before September 30th. Chartwell then brought this appeal.

3For the reasons set out below, Chartwell’s appeal is denied.

Legislation

4Section 357 of the Municipal Act, 2001, S.O. 2001, c. 25 states, in part:

Cancellation, reduction, refund of taxes

357(1) Upon application to the treasurer of a local municipality made in accordance with this section, the local municipality may cancel, reduce or refund all or part of taxes levied on land in the year in respect of which the application is made if…,

(f) a person was overcharged due to a gross or manifest error that is clerical or factual in nature, including the transposition of figures, a typographical error or similar error but not an error in judgment in assessing the property; or….

Meeting

(5) On or before September 30 of the year following the year in respect of which the application is made, council shall,

(a) hold a meeting at which the applicants may make representations to council;

(b) notify the applicants of the meeting by mail sent at least 14 days before the meeting; and

(c) make its decision.

Where no decision

(8) If council fails to make its decision by September 30 of the year following the year in respect of which the application is made, an applicant may appeal to the Assessment Review Board by October 21 of the year by filing a notice of appeal with the registrar of the board and the appeal shall be a new hearing.

Decision

(10) The Assessment Review Board shall hear the appeal and may make any decision that council could have made.

Refund of Taxes

5Chartwell indicates that MPAC acknowledged that it made an error in assessing Chartwell’s property based on errors in the factual information MPAC had on file. The 2013 and 2014 tax years both require that the property be assessed at its likely sale value on January 1, 2012. MPAC’s correction to the assessed value in 2014 essentially acknowledges that the 2013 assessment would have been $2,628,000 if they had the correct factual information.

6Section 357(1)(f) of the Municipal Act, 2001 permits a refund of taxes for a particular class of errors. The errors must be “gross or manifest”, the errors must also be “clerical or factual in nature, including the transposition of figures, a typographical error or similar error.” Finally, the errors cannot be “an error in judgment in assessing the property.” Only errors that meet all three criteria are entitled to a refund of taxes. I will address each of these categories of error in turn.

Gross or Manifest Error

7The first issue to address is if the error in Chartwell’s assessment is a gross or manifest error. The Supreme Court of Canada considered the phrase “gross or manifest error” in Wilkes v. Interlake Tissue Mills Co. Ltd., 1969 CanLII 9 (SCC), [1970] S.C.R. 441 (“Interlake”). The Court was considering what was then s. 131(1)(f) of the Assessment Act that permitted tax refunds for people who were “overcharged by reason of any gross or manifest error.”

8There, the taxpayer had succeeded in its appeal seeking a reduction in its assessment. The taxpayer then applied for a refund of the previous year’s taxes, arguing that they were in error because the appeal the following year had found the assessment to be in error. Justice Spence, writing for the majority of the Court, held that a gross error is simply a “big” error, and that the taxpayer was entitled to a refund.

9The error here changed Chartwell’s assessment by $662,000, or 20%. That is a large change, and is a gross error.

Typographical Error

10The legislation has changed since the Supreme Court of Canada decision in Interlake. The Municipal Act, 2001 now provides an example of the types of errors contemplated: “the transposition of figures, a typographical error or similar error.” These mechanical errors are a smaller class of errors than all gross errors, which was how the legislation before the Court in Interlake was framed. This list of examples narrows the eligible errors significantly.

11I do not believe that an error in MPAC’s database on the description of property is a similar error to a typographical error. The error could be typographical, but it more likely was due to bad judgment, or poor data gathering, in determining the characteristics of the building. Without any evidence on how the error was made, I cannot conclusively find that the error here is similar to the transposition of figures or a typographical error.

Error in Judgment

12An error in judgment in assessing the property is explicitly excluded from the types of errors that are eligible for a refund. The error here is an error in judgment and is therefore not an error that can be the basis for a refund.

13MPAC did not appear before me, but the change in the assessment and the hearsay evidence for its basis, indicate that what changed was MPAC’s opinion of value. That opinion was based on some factual information, but in explicitly excluding the assessor’s opinion, the legislature has indicated that MPAC can change its opinion of value without putting the municipal tax base at risk.

14The change here is what is contemplated by the phrase “an error in judgment in assessing the property.” MPAC reviewed its records, without prompting, and on that basis changed its opinion of value. Section 357(1)(f) explicitly excludes that type of adjustment from the errors eligible for tax relief.

Overcharge

15I have found that this is not an error covered by s. 357(1)(f) because it is an error in judgment in assessing the property and is not a transposition, typographical, or similar error. But, in the event that I am wrong in those findings, I will still calculate the amount Chartwell was overcharged as a result of the error.

16For 2013 taxation, Chartwell was taxed at the commercial rate of 0.02653272 on the phased in value of $3,017,000 for the returned assessment of $3,290,000. That resulted in 2013 taxes of $80,049.22 being levied and paid. But the assessment would have been $2,628,000 if MPAC had not made the error. There would be no phased in value for that assessment, as it is lower than the 2008 current value. Therefore, the taxes for 2013 would have been $69,727.99, but for the gross errors in judgment made by MPAC.

17The amount of the overcharge is the difference between the $80,049.22 that was paid and the $69,727.99 that should have been paid. That overcharge is $10,321.23.

CONCLUSION

18Chartwell was overcharged by $10,321.23 for the 2013 taxation year due to a gross error in how their assessment was determined. But that error was an error of judgment in assessing the property and not the transposition of figures, a typographical error, or similar error. It is therefore not an error that can be remedied pursuant to s. 357(1)(f). Chartwell’s appeal is denied.