Philip Brown and Beverley Brown v. Municipal Property Assessment Corporation, 2018 CanLII 32168

Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE:

April 09, 2018

FILE NO.:

WR 150893

Assessed Person(s):

Philip Brown and Beverley Brown

Appellant(s):

Philip Brown and Beverley Brown

Respondent(s):

Municipal Property Assessment Corporation (“MPAC”) Region 15

Respondent(s):

Town of Oakville

Property Location(s):

15 Culham Street

Municipality(ies):

Town of Oakville

Roll Number(s):

2401-030-360-00020-0000

Appeal Number(s):

3256255

Taxation Year(s):

2017

Hearing Event No.

693868

Legislative Authority:

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

Heard:

February 05, 2018 by telephone conference call

APPEARANCES:

Parties

Counsel⁺/Representative

Philip Brown

Self-represented

Beverley Brown

MPAC

Valerie Lamothe

Town of Oakville

Susan Price

DECISION OF THE BOARD DELIVERED BY TYRONE D. SKANES

ISSUE

1The appeal before the Assessment Review Board ("Board") was filed by Philip Brown and Beverley Brown (the “Appellants”) in respect of the assessment of a single, detached family home located at 15 Culham Street, the subject property (“SP”), for the 2017 taxation year.

2The two-storey 2,250 square foot ("sq. ft.") home, with 1,059 sq. ft. on the main floor and 1,191 sq. ft. on the second floor was built in 1991 and is situated on a lot size of 5,000 sq. ft. It has an unfinished basement of 1,076 sq. ft. There is an attached garage measuring 480 sq. ft.

3Valerie Lamothe, representing MPAC, entered the sales of six comparable properties that she said were good comparators to the SP. She said she used the direct sales comparison approach to value to determine the current value assessment of the SP at $772,000. She said that this value was reduced to $727,000 as the result of a Request for Reconsideration filed by the Appellants. She said that she further conducted an equity analysis and discovered that similar lands in the vicinity were not being assessed at or near their correct current values and that an equity adjustment was required. She further reduced the assessment to $707,000 in order to make it equitable with other land in the vicinity. She opined that this value was fair and reasonable and was recommending the Board reduce the assessment to that value.

4Susan Price, representing the Town of Oakville (“the Town”) entered the sales of five comparable properties into evidence that she said were good comparators to the SP. She joined MPAC in its’ recommendation that the adjusted value of $707,000 was fair and reasonable.

5Philip Brown, representing himself and his wife did not enter any sales evidence to support his recommendation that the Board reduce the assessment of the SP to $657,000. Instead, he focused his argument on what he believed was an inequity in the assessments of neighbouring properties in relation to the SP and the difference in the value assessment of lands between assessment cycles. He said he disagreed with the comparable properties used by MPAC and the Town as he did not believe they were an

“apples to apples” comparison. He was asking the Board to reduce the assessment of the SP to $657,000.

6The issue before the Board for determination is whether the assessment of the SP for the 2017 taxation year is at current value and whether the assessment is equitable with the assessment of similar lands in the vicinity.

DECISION

7The Board is required by s. 44.(3)(a) and (b) of the Assessment Act, RSO 1990, c A.31 (“Act”) to determine the current value of the land and have reference to the value at which similar lands in 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.

8The Board finds the current value of the SP as of January 1, 2016 is $772,000. MPAC’s equity analysis that revealed that similar lands in the vicinity are not being assessed at or near their correct current values and an adjustment is required for equity and reduces the assessment to $707,000.

REASONS FOR DECISION

Relevant Legislation

9Section 44.(3) of the Act states:

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.

MPAC's Position and Evidence

10Ms. Lamothe’s valuation report was entered into evidence as Exhibit 1 and an Equity Analysis as Exhibit 2. She testified that the direct sales comparison approach to value was used in determining the current value of the SP.

11Ms. Lamothe entered the sales of seven comparable properties that she opined were good comparators to the SP. She said that all of the comparable properties were in the same homogenous neighborhood and all were two storey structures.

12Ms. Lamothe testified that she conducted an equity study, whereby the sales of 31 similar lands located within one kilometer of the SP were examined and it was determined that there was an inequity in the assessment of the SP that required an adjustment. Her analysis revealed that those similar lands had not been assessed at or near their correct current values. An equity adjustment reduced the assessment of the SP to $707,000.

13Ms. Lamothe concluded her presentation by saying that she believed the adjusted assessment was fair and reasonable and was recommending the Board reduce it to that value.

Appellants Position and Evidence

14Mr. Brown, representing himself and his wife, entered a documentary package as Exhibit 3. He said that while he was not formally trained in land assessment or valuation he did have 18 years experience as a real estate agent.

15Mr. Brown introduced three comparable properties into evidence for which there had been no recent sales. He said that he used these properties because they were in close proximity to the SP, being on the same street. He was familiar with the properties and highlighted improvements made to them, with cost estimates. He said that the SP did not have any similar improvements. He highlighted the change in assessments between the 2012 valuation date and 2016 valuation date and could not understand how the SP’s assessment could increase so dramatically, in comparison to the three improved properties that he used.

16Mr. Brown concluded his presentation by asking the Board to reduce the assessment of the SP to $657,000 based on a series of calculations that he performed between his three comparable properties and the SP.

Municipality’s Position and Evidence

17Ms. Price, representing the Town, entered a documentary package into evidence as Exhibit 4. She entered the non-adjusted sales of five comparable properties into evidence that she opined were good comparators to the SP. She testified that she was joining MPAC in their recommendation of value and was recommending the Board reduce the assessment to $707,000.

Board's Deliberations - Current Value

18The best evidence of current value is the sale of the SP if the sale meets the definition of current value on or near the valuation day. When no such sale occurs, as in this instance, the Board looks to the sale of similar properties in the vicinity to determine current value.

19The Board has carefully considered the testimony of the parties and the documentary evidence tendered as exhibits.

20The Board, when comparing properties, does not expect exactness or sameness. Therefore, the Board looks at similarity of characteristics, amenities and location to determine comparability.

21The Board usually considers the sales of comparable properties that have occurred within one year on either side of the valuation date as the ideal time period for consideration. The Board occasionally does extend the time period for considering comparable properties when the parties have demonstrated that there are an insufficient number of relevant sales during the ideal time period.

22MPAC entered the sales of six properties in close proximity to the SP that the assessor opined were good comparators to the SP. The comparable properties are the same type of structure and in the same homogenous neighbourhood. All are situated on similar sized lots and, with the exception of Properties five and six, are within 300 sq. ft. of building size of the SP. Property five is substantially smaller at 1,478 sq. ft. and Property six is substantially larger at 2,626 sq. ft. The Board finds that these comparable properties are similar lands and will use them for comparison. They are highlighted below in Table 1.

23The Municipality entered five comparable properties for consideration but did not provide time adjusted sales prices (“TAS”). The comparable properties submitted by MPAC that the Board will consider have TAS prices. The Board finds that using non-adjusted sales prices would not provide a consistent analysis and therefore will not use those comparable properties submitted by the Municipality.

24The Appellant entered three properties for consideration but none of those properties had recent sales. Instead, the Appellant used them to argue the difference in assessments due to improvements that the SP has not had and to highlight the difference in assessments between the 2012 and 2016 valuation dates. The Board will not use these properties in its deliberations due to the lack of recent sales.

25The Appellant made an impassioned argument against the seemingly significant increase in the assessment of the SP between the 2012 and 2016 valuation dates. Market conditions may change between valuation days, and while the Board acknowledges Mr. Brown’s dismay with the assessment increase from the 2012 to 2016 valuation days, there is nothing in the Act which requires there to be a correlation among assessments from one valuation period to another.

26MPAC’s comparable properties are:

Table 1

Property

Year Built

Structure Type

Building Size (Sq. Ft.)

Building Area (Sq. Ft.)

Garage

Bsmt. Finish

Time Adjusted Sale Price (“TAS”)

Inferior, Relatively Comparable or Superior

Subject Property

1991

2 storey

2,250

5,000

Yes

No

N/A

Sale 1

1970

2 storey

2,153

4,733

No

Yes

$732,933

Inferior

Sale 2

1980

2 storey

2,022

9,260

Yes

No

$984,103

RC

Sale 3

1979

2 storey

1,947

6,178

Yes

Yes

$999,722

RC

Sale 4

1979

2 storey

2,037

9,431

Yes

No

$973,330

RC

Sale 5

1971

2 storey

1,478

3,639

Yes

Yes

$711,483

Inferior

Sale 6

1980

2 storey

2,626

7,998

Yes

Yes

$1,090,277

Superior

27Table 1 above lists the main features of the sales comparables, in order of importance. After considering the information in Table 1, the testimony of the witnesses and other evidence, the Board made a finding as to whether the sales comparables are inferior, relatively comparable or superior to the SP.

28In the Board’s determination, sales one and five are inferior to the SP, owing to a significant difference in the year built. Sale one does not have a garage. Sale five’s building size and lot sizes are significantly smaller than that of the SP. Sales two, three and four are relatively comparable to the SP because there is little difference in the year built, they all have garages, and there is a close correlation between the building and lot sizes. Sale six is superior to the SP owing to the significantly larger building and lot sizes.

Table 2

29The SP’s current value is higher than the highest sale price of the inferior properties and lower than the sale price of the superior property. Table 2 demonstrates this range.

30Therefore, the Board finds the current value of the SP to be $772,000.

Board's Deliberations – Equity

31MPAC entered an equity study into evidence whereby the sales of 31 similar properties located within one kilometre of the SP were analyzed. The assessor said that she determined that the median Assessment to Sales (“ASR”) was 0.915 and this ASR fell outside of MPAC’s range of 0.95 to 1.05 for determining whether equity had been achieved. An ASR of 0.915 indicates that, on average, property in vicinity is assessed at only 91.5% of its current value. That is significantly below current value. It would therefore be unfair to assess the SP at its current value. An equitable assessment would be similar to the level of assessment of other property. The Board therefore finds that an equitable assessment would be 91.5% of the current value of $772,000, or $706,380, rounded to $707,000.

CONCLUSION

32The Board finds that the current value of the SP is $772,000. However, the Board finds that it would be unfair and inequitable to assess the SP at that current value, and therefore reduces the current value to an equitable assessment of $707,000.