Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: December 22, 2017 FILE NO.: WR 148792 Assessed Person(s): G. H. and H.H. Applicant(s): G. H. Respondent(s): City of Toronto Property Location(s): Withheld Municipality(ies): City of Toronto Roll Number(s): Withheld Appeal Number(s): 3064795 Taxation Year(s): 2015 Hearing Event No.: 686578 Legislative Authority: Section 323(1)(e) of the City of Toronto Act, 2006, S.O. 2006 c.11 Sched. A, as amended Heard: September 27, 2017 in Toronto, Ontario

APPEARANCES:

Parties	Counsel⁺/Representative
G. H.	Self-represented
City of Toronto	J. Boyczuk⁺ and Melanie Shankar

DECISION OF THE BOARD DELIVERED BY SUBUOLA AWOLERI AND DAN WEAGANT

INTRODUCTION

1The subject property is a single family dwelling on a lot measuring 70.12 feet by 116.14 feet.

2G. H., (“Applicant”) owns the subject property with his spouse H. H.

ISSUE

3Should the Applicant be granted a refund of all or part of the taxes levied for the taxation year 2015 because of an inability to pay due to sickness or extreme poverty pursuant to s. 323(1)(e) of the City of Toronto Act, 2006 (“Act”)?

DECISION

4The Assessment Review Board (“Board”) is not satisfied that the Applicant would have been unable to pay the property taxes for the 2015 taxation year due to sickness or extreme poverty. The application is dismissed.

REASONS FOR DECISION

5In making a decision in this matter, the Board must have reference to s. 323(1)(e) of the Act.

6Section 323 (1)(e) states in part:

Cancellation, reduction, refund of taxes

323 (1) Upon application to the city treasurer made in accordance with this section, the City 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,

(e) the applicant is unable to pay taxes because of sickness or extreme poverty;

Sickness

7G. H. testified that he has suffered from a variety of illnesses over the years and continues to suffer from chronic illness that makes it very difficult for him to work. He also mentioned that at the age of 68, combined with his ongoing illness, he is unable to find suitable employment. G.H. did not provide any documentary evidence of his health condition from a health care professional which is typically submitted in these applications. However, Ms. Boyczuk submitted that the City of Toronto (“City”) took no position on the issue of G.H.’s illness.

Extreme Poverty

8“Extreme Poverty” is the term used in the Act to describe the circumstance, other than sickness, which could lead to an Applicant being unable to pay municipal taxes on his or her property.

9G.H. provided limited information on income. Exhibits 1 and 3 are copies of the ‘T1 General’ forms submitted to the CRA for the 2015 taxation year, for G.H. and H.H. respectively. The T1 General forms indicate taxable income for G.H. in the amount of $12,928.85 and $40,341.64 for H.H. The Canada Revenue Agency’s (“CRA”) notices of assessment for the 2015 taxation year were not in evidence.

10G.H. testified that his annual expenses for 2015 were $33,995.28, not including a total of $1,500 in unpaid fines for offences. G.H. did not disclose any details about the nature and specifics about these offences. He submitted that this total expense is far above his income for the year and as a result, he is in a condition of extreme poverty. The Board has no evidence regarding the annual living expenses of H.H.

11G.H. testified that in 2015, H.H. ‘saved’ his house by applying for, and obtaining a mortgage in the amount necessary to clear an accumulated property tax account and a lien levied by the Federal Minister of Finance for accumulated income tax arrears. G.H. claimed that he had been threatened by the City that it would seek to sell the property to recover the taxes owing, leading he and H.H. to take the steps necessary to pay the taxes.

12G.H. testified that his spouse, H.H., lives at another property, in another municipality also owned by H.H., known for the purpose of this Application as “31 ROR”. There is no evidence before the Board with respect to the value of 31 ROR, or any charges against it. The T1 General form submitted as evidence of income shows 31 ROR as the mailing address for both G.H. and H.H.

13H.H. also owns an income producing property in Toronto, known for the purpose of this Application as “44-100 GHB”. Despite repeated questions regarding these other real estate assets held by H.H., the Applicant was initially evasive and later steadfast in stating he knew nothing of the financial status of these two other properties except that 44-100 GHB regularly has expenses that out-weigh the income it produced.

14Ms. Boyczuk submitted as Tab 8 in the City’s Exhibit 5, a summary of 44-100 GHB, showing a 2012 Current Value Assessment (“CVA”) of $373,000, owned by H.H. The mailing address on the City’s records associated with 44-100 GBH is the property subject to this application. There is a mortgage on 44-100 GHB in the amount of $155,000.

15The subject property has a 2012 CVA of $867,000, with a mortgage in the amount of $157,000.

The Board’s Analysis

16In making a determination under this section of the Act, the Board must undertake a two part assessment. First, the Board must determine whether or not the Applicant is sick or is in a condition of extreme poverty. If the Board finds the Applicant to be in either of these two conditions, then it must further determine if either or both of these conditions is the reason that property taxes could not be paid for the year under appeal.

Sickness

17The Board finds G.H.’s testimony to be the best evidence that he is unable to work due to sickness. While he provided no documentary evidence to support his position, The City took no position on whether or not G.H. is in a condition of sickness, nor did it seek to refute G.H.’s testimony.

Extreme Poverty

18The issue in dispute regarding the application of the test for “extreme poverty” arises through the evidence of assets owned by the Applicant and H.H., the other assessed person shown on the abbreviated Parcel Register submitted by the City as Exhibit 2.

19The subject property has a current value of $867,000, with a mortgage of $157,000, reflecting equity of $710,000. The property at 44-100 GBH has a current value of $373,000 with a mortgage of $155,000, reflecting equity of $218,000.

20The total equity in these two properties exceeds $900,000. Despite G.H.’s assertion that he and H.H. live separately, documents in evidence clearly show that both G.H. and H.H. use the subject property address and the 31 ROR property for various purposes.

21G.H. repeatedly testified that he lives in the subject property alone, that he and H.H. separated sometime in 2015 and all expenses connected with the subject property are his responsibility. The documents in evidence serve to erode G.H.’s credibility, and while they are not definitive, the Board gives less weight to G.H. oral testimony on this point. There was no formal agreement in evidence as to the arrangement between the spouses on the apportionment between them of expenses.

22Ms. Boyczuk submitted as follows:

• The Board must consider all assets available to the Applicant to assess his ability to pay property taxes;

• Both G.H. and H.H. are on title to the property and as a result, the resources of both persons needs to be considered when determining an inability to pay property taxes;

• The 2015 taxes that are subject to this application have in fact been paid, indicating that the Applicant had the ability to pay; and

• In order to be successful under this section of the Act, the Applicant must demonstrate he had no resources available for the payment of property taxes, after his most basic needs are met.

23Ms. Boyczuk cited ‘M.M.U. v Toronto (City), [2015] O.A.R.B.D. No. 204, a prior decision of the Board dealing with the full consideration of assets in determining whether or not an Applicant is in a condition of extreme poverty. In that decision, Member Sharma stated:

In order to qualify under this section of the Act, the Applicant is required to show that every reasonable effort has been made to pay all or part of the taxes. There is an expectation that to qualify for relief under this section of the Act the condition cannot be one where an individual simply cannot make ends meet but amounts to a situation where the Applicant after having called upon every resource available to him and having applied every reasonable means to mitigate and manage his expenditures is left with no means of being able to pay some or all of their property taxes.

24The Board agrees with Ms. Boyczuk, and using the wording from M.M.U. v. Toronto (City) (supra), G.H. has neither shown every reasonable effort to pay all or part of the taxes, except when forced by the City to tap into the equity present in the subject property, nor has G.H. called upon every resource available to him to pay his property taxes.

25With respect to G.H.’s assertion that he alone is responsible for the expenses at the subject property, H.H. is also an owner. This ownership constitutes an interest in the property and all of the rights and obligations of ownership. For this reason, the Board finds that both G.H. and H.H are responsible for the property taxes and it is reasonable to consider the assets of both in its determination of the Application.

26The Board finds that G.H., while demonstrating that he is in a condition of sickness, has not demonstrated that he is unable to pay his property taxes for this reason because of the large amount of home equity available to him and his spouse H.H.. Secondly, the Board finds that G.H. and H.H. have failed to demonstrate a condition of extreme poverty as they have amassed a large amount of equity on two properties in the City and therefore have an ability to pay property taxes.

27The Board is satisfied that the Applicant had the ability to pay property taxes levied on the subject property during the 2015 taxation year. Therefore, the application is dismissed.