Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: December 19, 2018 FILE NO.: RD 2018M19

Assessed Person(s): Garfield Murray Payne; Iva Ludmila Payne Appellant(s): Garfield Murray Payne, Iva Ludmila Payne Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 15 Respondent(s): Town of Oakville

Property Location(s): 1321 Cambridge Drive Municipality(ies): Town of Oakville Roll Number(s): 2401-040-140-06400-0000 Appeal Number(s): 3235620 and 3308019 Taxation Year(s): 2017 and 2018 Hearing Event No.: 694865

Legislative Authority: Rule 123 of the Assessment Review Board Rules of Practice and Procedure Request for: A review of the Board’s Decision WR 152292, issued on September 24, 2018 Heard: By written submission

Parties	Representative	Submissions
Garfield Murray Payne, Iva Ludmila Payne	Self-represented	Requester
MPAC	No one appeared	Not Requested
Town of Oakville	No one appeared	Not Requested

DECISION DELIVERED BY PAUL MULDOON AND ORDER OF THE BOARD

INTRODUCTION

1Garfield Murray Payne and Iva Ludmila Payne (the “Paynes”) apply to have the decision of the Assessment Review Board (the “Board”) in Payne v Municipal Property Assessment Corporation, Region 15, 2018 CanLII 91624 (ON ARB) (the “Decision”) reviewed. The Decision was issued on September 24, 2018 and this Request for Review was filed with the Board on October 18, 2018.

2The Paynes allege that the Decision contains a number of significant errors of law and fact such that the Board would likely have reached a different decision. The Board is not satisfied that the Decision contains any such errors.

ISSUES AND ORDER SOUGHT

3The Paynes argue that there are five main errors in the Decision. They say that the Decision erred in:

a. finding that their property would sell for more than properties the Decision found were superior;

b. finding that only properties in the same “homogeneous neighbourhood” could be considered for determining current value;

c. accepting MPAC’s flawed equity evidence; and

d. refusing to accept their time adjustment factors; and

e. not applying a reduction to the assessment to account for the impact of traffic.

RELEVANT RULES

4Review requests must meet the procedural requirements of Rule 120 before they are considered. There are no procedural concerns with the Paynes’ request. Reviews can only be granted if the provisions of Rule 121 are met. That Rule states:

121 A request for review will not be granted unless the Board is satisfied that:

(a) the Board acted outside its jurisdiction or violated the rules of natural justice or procedural fairness;

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

(c) the Board heard false or misleading evidence from a party or witness, which was discovered only after the hearing and would have affected the result;

(d) there is new evidence that could not have reasonably been obtained earlier and would have affected the result; or

(e) any of the situations in Rule 122 exist.

ERRORS OF FACT OR LAW

5As noted above, the Paynes have alleged that the Decision contains five main errors. Each will be addressed in turn.

Value Determination

6The Paynes note that the Decision found, at paragraph 39, that the property at 216 Wedgewood Drive was superior to the Paynes’ property. 216 Wedgewood sold for $1,120,000 in January of 2015, indicating a time-adjusted sale value of $1,268,487. The Decision also found, at paragraph 38, that the property at 1234 Donlea Crescent was superior to the Paynes’ property. 1234 Donlea Crescent sold for $1,515,000 in June 2016, indicating a time-adjusted sale value of $1,434,705. The Decision found that the Paynes’ property likely would have sold for $1,448,000 on January 1, 2016. The Paynes say that it is illogical to conclude that their property would have sold for significantly more than a superior property.

7The Decision found that two properties in evidence were the most comparable to the Paynes’ property: 132 Caulder Drive and 182 Wedgewood Drive. The Decision held, at paragraph 40, that the likely sale value of the Paynes’ property was the midpoint of the time-adjusted sale values of those two, most comparable, properties. That is a reasonable conclusion.

8The Paynes are correct that it is odd that the two properties that the Decision found were superior properties had time-adjusted sale values lower than the likely sale value of their property. The average sale value of all four sales accepted by the Decision is $1,422,271. The assessment as returned was $1,315,000 and no one was requesting that the assessment be increased. That means that the resulting assessment would have been the same, even if the Decision had considered all of the accepted sales. The error in rejecting properties with lower sale values as superior, if it is an error, is not one that would have affected the result.

Homogeneous Neighbourhood

9The Paynes’ main concern appears to be the Decision’s use of the term “homogeneous neighbourhood.” The Decision uses that term nine times. First, in paragraph 8, noting that MPAC’s suggested comparable sales are “all within the same homogenous neighbourhood.” The term appears three times in paragraph 31, where the Decision reviews the Paynes’ time adjustment proposal. The final five times the term is used are all in paragraph 37, where the Decision rejected the Paynes’ suggested comparable sales.

10The Paynes argue that the term “homogenous neighbourhood” is not well defined and is not used in a consistent way in the Decision. They also note that the Board has preferred the word vicinity is cases such as Hellyer v Municipal Property Assessment Corp. Region No. 17, [2011] O.A.R.B.D. No. 57 and Drewin v Municipal Assessment Corp., Region No. 25, [2006] O.A.R.B.D. No. 504. The Paynes say that if the Decision had applied the vicinity test, it would have considered the sale of 2003 Elmhurst Avenue, which may have affected the result.

11The Board agrees with the Paynes that the use of the term “homogenous neighbourhood” is not a precise term and that a more specific description of the concept would have been preferred. However, the Decision was conveying, in both its assessment of time adjustment factors and Paynes’ proposed comparable properties, that comparable properties that were closer to the Paynes’ property were to be preferred. There is no basis to conclude that that the use of the imprecise term “homogenous neighbourhood” changed that general finding.

12When addressing time adjustment factors, at paragraph 31, the Decision preferred MPAC’s proposed time adjustment factor because it “is more accurate as it relates to the subject property’s homogenous neighbourhood.” The Decision goes on to explain that the “whole Town of Oakville is not assessed the same, some areas are more valuable than others.” That is a reasonable finding. That conclusion would not have changed if the Decision had used the term “vicinity.” The reasons given for preferring MPAC’s time adjustment factors do not turn on the phrase used to describe the more localized data.

13The Decision also relied on the term “homogenous neighbourhood” at paragraph 37, in determining that the Paynes’ suggested comparable sales should not be relied upon. The Paynes had presented seven proposed properties. The Decision found that four had no recent sales, so did not have any sale value that could be relied upon. It also found that two of the properties with sales sold too far from the valuation day. The only sale that the Decision specifically considered was the sale of 2003 Elmhurst Avenue, which sold in November 2014. The Decision rejected that sale, primarily because it found that the sale “is located in a different homogenous neighbourhood from the subject property.” The Paynes take issue with that determination.

14The Paynes say that 2003 Elmhurst Avenue is in the vicinity of their property and that it would have been considered if the Decision had used the term “vicinity.” The Board does not accept that argument. The Decision’s use of one term does not necessarily determine the outcome. While “homogenous neighbourhood” is an imprecise term, it indicates that the sale was an unacceptable distance from the Paynes’ property. The Board is not satisfied that using the term “vicinity” would have resulted in 2003 Elmhurst Avenue being included in the Decision’s calculations.

15But even if 2003 Elmhurst Avenue were included in the averaging done in the Decision, it would not have affected the result. The average of all five sales, including 2003 Elmhurst Avenue, is $1,362,817. As noted above, the returned assessment was $1,315,000 and no one was requesting that the assessment be increased. Even if the Decision was in error in rejecting 2003 Elmhurst for being in a different “homogenous neighbourhood,” that error would not have affected the result.

Equity

16The Decision states, at paragraph 45, that the “Appellants did not provide their own evidence for equity.” The Paynes say that is an incorrect statement and go on to argue that MPAC’s equity evidence contained a number of factual errors. They argue that the properties presented by MPAC for equity are not similar properties in the vicinity. Those arguments were reviewed at paragraph 44 of the Decision.

17The Decision assessed the similarity of the proposed properties, noting that Divisional Court had directed, in Municipal Property Assessment Corporation v Loblaw Properties Limited, 2017 ONSC 1299 at paragraph 25, that “all points of comparison must be considered.” The Decision held, at paragraph 48, that the proposed properties were “similar properties in terms of its location; they are all very close to the subject property, nature all single detached homes, and its use all residential properties.” That is a fair consideration of similarity. While other points of comparison could have been considered, it is not clear that a smaller set of similar properties would have led to a different conclusion.

18There is a presumption that property should be assessed at its current value, see subsection 19(1) of the Assessment Act, R.S.O. 1990, c. A.31. An adjustment for equity is only required when there is evidence that it would be unfair or inequitable to assess the property at its current value. This Board has held that the “best evidence that there is an inequity is a statistically reliable level of assessment study,” Jay Patry Enterprises Inc. v Municipal Property Assessment Corporation, Region 05, 2019 CanLII 39629 (ON ARB), 2018 CanLII 70338 (ON ARB) at paragraph 110. But if there is no evidence of an inequity the assessment will be at current value.

19The Paynes have pointed out that MPAC made some errors in its equity study, including failing to specify the area from which the suggested properties were taken. But the Paynes have not indicated how a smaller sample of properties would have provided sufficient evidence that it would be inequitable to assess their property at its current value. A review can only be granted if the Board is satisfied that an error would have affected the result. The Paynes have not satisfied the Board that a different finding on which properties were similar for equity purposes would have resulted in a different Decision being made.

Time Adjustment

20The Paynes argue that the Decision unreasonably rejected the time adjustment factor they had proposed, preferring MPAC’s evidence on time adjustment. As noted above, this was because the Decision found that more localized data was better evidence of price changes over time. There is no error in that determination.

21The Decision’s preference for more reliable, localized, time adjustment factors was in line with this Board’s recent jurisprudence. This Board recently reviewed time adjustment factors in Sundararaj v Municipal Property Assessment Corporation, Region 03, 2018 CanLII 104619 (ON ARB). The Board held, at paragraph 8, that “time adjustment will never be perfect and that caution should always be exercised when relying on time adjustment.” That decision went on to say that it “is highly likely that each area changes over time in its own way so these global trends are not likely to truly reflect the changes in particular sale prices.”

22The Paynes’ argument that their time adjustment factors should have been preferred is an attempt to re-argue and issue was settled in the Decision. That is not the proper role of a review. The Board is not satisfied that there are any errors in how the Decision addressed time adjustment factors.

Traffic Adjustment

23The Paynes say that the Decision erred in refusing to apply a 5% to 15% reduction in value to reflect the fact that their property is close to busy Lakeshore Road East. They say that the Decision erred in finding, at paragraph 34, that they were not entitled to an adjustment because their property “does not abut medium traffic and it is not located on Lakeshore Road East and does not back unto Lake Shore Road.” They submit that is not the correct test. They argue that they are “in proximity” to Lakeshore Road East, so should be entitled to a 5% reduction.

24The traffic reduction at issue was taken from MPAC’s proprietary valuation algorithm. The Board should not, generally, be taking parts of MPAC’s model and applying them to values obtained from comparable sales. The model is not before the Board and it is inappropriate for the Board to take parts of the model, when the model has not been proven. The Decision was correct in stating, at paragraph 34, that the “Board cannot arbitrarily assign a negative adjustment to value without quantitative market evidence.”

25The Paynes argue that they do not know what “quantitative evidence” is and did not know that they needed to bring that to the hearing. The Board is aware of such evidentiary challenges, however, it is fair to say that the Paynes ought to have known that they needed to bring evidence to the hearing in order to prove a different assessment. Quantitative evidence is generally evidence based on numbers. There is no error in the Decision finding that a reduction in value must be proven with evidence.

ORDER

26The Paynes have not satisfied that Board that there are any significant errors of law of fact such that the Board would likely have reached a different decision. Their Request for Review is therefore denied.