Kilpatrick v. Municipal Property Assessment Corporation, 2018 CanLII 102246

Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE:

October 26, 2018

FILE NO.:

WR 156094

Assessed Person(s):

Deborah Schadek; Keith Andrew Kilpatrick; Lorellee Lynn Kilpatrick

Appellant(s):

Keith Andrew Kilpatrick; Lorellee Lynn Kilpatrick

Respondent(s):

Municipal Property Assessment Corporation (“MPAC”) Region 32

Respondent(s):

Municipality of Kenora Locality Education

Property Location(s):

Island D100 PCL 640

Municipality(ies):

Municipality of Kenora Locality Education

Roll Number(s):

6007-020-000-38300-0000

Appeal Number(s):

3268115 and 3320499

Taxation Year(s):

2017 and 2018

Hearing Event No.:

703873

Legislative Authority:

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

Heard:

September 25, 2018 by telephone conference call

APPEARANCES:

Parties

Representative

Deborah Schadek, Keith Andrew Kilpatrick and Lorellee Lynn Kilpatrick

No one appeared

MPAC

Jeff Favreau

Municipality of Kenora Locality Education

No one appeared

MEMORANDUM OF ORAL DECISION OF THE BOARD DELIVERED BY JENNIFER GRIFFITH ON SEPTEMBER 25, 2018

BACKGROUND

1These appeals before the Assessment Review Board (the “Board”) are filed by Deborah Schadek, Keith Andrew Kilpatrick and Lorellee Lynn Kilpatrick (the “Appellants”) in respect to the returned assessment of $942,000 for the 2017 and 2018 taxation years for the Subject Property at Island D100 PCL 640, in the Municipality of Kenora Locality Education.

2Jeff Favreau, representative for MPAC (“MPAC’s representative”) takes the position that the appeals should be dismissed, because no one called into today’s scheduled Telephone Conference Call hearing (“TCC”) for the Appellants. However, MPAC’s representative states that it is MPAC’s position that the current value should be $789,000, based on a recommendation that was offered to the Appellants prior to today’s scheduled TCC and it was rejected.

3The Appellants did not call into today’s scheduled TCC. The Board waited 10 minutes for the Appellants and no one joined the TCC. Therefore, the Board proceeded with the hearing and makes a determination of current value.

ISSUE

4The issues in this hearing are the correct current value of the Subject Property for the 2017 and 2018 taxation years, and if it would be equitable to assess the Subject Property at its current value.

DECISION

5The Board finds that the current value of the Subject Property is $789,000. The Board reduces the returned assessment from $942,000 to $789,000 for the 2017 and 2018 taxation years.

REASONS FOR DECISION

6The Appellants did not call into today’s scheduled TCC. The only evidence and submissions before the Board were given by MPAC. However, the Appellants filed disclosure documents with the Board and those documents were analyzed by the Board.

The Legislation

7In determining the value at which land shall be assessed, the Board must have regard to the following provisions of the Assessment Act R.S.O. 1990, c. A.31 (“Act”).

8Section 1 of the Act states:

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.

9Section 19.(1) of the Act states:

19.(1) Assessment based on current value. – The assessment of land shall be based on its current value.

10Section 19.2(1)2 of the Act states:

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.

11Section 40.(17) of the Act states:

40.(17) Burden of proof. – For 2009 and subsequent taxation years, where value is a ground of appeal, the burden of proof as to the correctness of the current value of the land rests with the assessment corporation.

12In determining the value at which any land shall be assessed, s. 44.(3)(a) and (b) of the Act requires the Board to do two things:

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.

The Current Value of the Subject Property

MPAC’s Evidence and Submissions

13MPAC’s representative requests that the appeals be dismissed, because no one calls into today’s scheduled TCC hearing for the Appellants. However, MPAC’s representative states that it is MPAC’s position that the current value should be $789,000, based on a recommendation that was offered to the Appellants prior to today’s scheduled hearing. MPAC’s representative states that the recommended value is based on a revision of the square footage of the cottage from 5,575 square feet to 3,920 square feet; a change in the condition of the cottage from fair to poor as a result of an inspection; sale evidence; and an equity reduction of 0.932 based on 30 sales.

14MPAC states that the value of $789,000 is supported by six sales which occurred in the open market over the period 2013 to 2017 with sale prices in the range of $660,258 to $1,986,164. Based on these six sales MPAC estimated the current value to be $847,000.

15MPAC also states that an equity analysis of 30 sales reveals a Level of Appraisal (“LOA”) of 0.932 which falls outside of MPAC’s acceptable standards of 0.95 to 1.05 and supports an equity reduction. When the LOA is applied to the current value it results in a value of $789,404 or $789,000 rounded ($847,000 x 0.932).

Appellant’s Evidence and Submissions

16No one called into the TCC. However, the Appellants filed disclosure documents with the Board and stated that it is their view that the current value is $700,000.

17The documents demonstrate an assessment change ratio of 0.966 (rounded) based on eight suggested comparable properties from the valuation date of January 1, 2012 to the valuation date of January 1, 2016.

18The Appellants stated in the documents that the assessment of the Subject Property increased by 30% from the valuation date of January 1, 2012 to the valuation date January 1, 2016 and that the increase is not warranted. The Appellants calculated current value to be $700,000 rounded, by applying the ratio 0.966 to the Subject Property’s 2012 assessment ($725,000 x 0.966). Other similar calculations based on 2012 assessment value for the Subject Property are detailed in the documents with proposed values ranging from $518,445 to $675,700.

19The Appellants stated in the disclosure documents that their opinion of value is $700,000.

20No other documents were entered in support of an equity reduction.

Board’s Analysis AND FINDINGS

21Based on MPAC’s recommendation of current value for the Subject Property, the Board accepts MPAC’s recommended value of $789,000.

22The Board also finds that only one sale of MPAC’s six sales occurred in the shoulder year 2015, and sold at a time adjusted sale price of $852,012. When this sale price is adjusted for equity it results in a current value of $794,000 rounded ($852,012 x 0.932) which is very close to MPAC’s recommended value of $789,000. The Board finds that MPAC’s recommended assessment is an equitable assessment of the Subject Property.

23The Board rejects the values proposed in the Appellants’ disclosure documents because current value is not based on a change in assessment from one valuation date to another. Current value is based on sales which occur in the open market as of the January 1, 2016 valuation day.

24Because submissions were made by MPAC, the Board has made a determination of current value in this proceeding and the appeals are not dismissed. The Board finds the current value is $852,012 and that an equitable assessment is $789,000.

CONCLUSION

25The Board finds the current value is $852,012, and that it would be equitable to assess the property at approximately 92.3% of that value, or $789,000. Therefore, the Board reduces the returned assessment value from $942,000 to $789,000 for the 2017 and deemed 2018 taxation years.

Jennifer Griffith”