Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: October 12, 2018

FILE NO.: WR 154093

Assessed Person(s): Michael Chiaravalle

Appellant(s): Michael Chiaravalle

Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 19

Respondent(s): City of Hamilton

Property Location(s): 278 Valridge Drive

Municipality(ies): City of Hamilton

Roll Number(s): 2518-140-320-22705-0000

Appeal Number(s): 3262471 and 3309968

Taxation Year(s): 2017 and 2018

Hearing Event No.: 701371

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

Heard: June 27, 2018 in Stoney Creek, Ontario

APPEARANCES:

Parties	Counsel+/Representative
Michael Chiaravalle	Self-represented
MPAC	Tim Oberle
City of Hamilton	No one appeared

DECISION OF THE BOARD DELIVERED BY TYRONE D. SKANES

PRELIMINARY ISSUE

1Mr. Chiaravalle, the Appellant, was accompanied by his father, Carmen Chiaravalle. He asked that he be allowed to present his son’s evidence as he had done much of the research and was familiar with the material. The Board asked the Appellant if there was any reason that he could not present the evidence himself and use his father as a resource, if necessary. The Appellant replied that he was familiar enough with the material to act as a witness, despite his father continuing to argue strenuously that he be allowed to participate. The Board advised the senior Mr. Chiaravalle that under the Board’s Rules of Practice and Procedure, Rules 12 and 14 advise when a party may act as a representative and what qualifications are required. He had not presented any of the necessary qualifications required to act in that capacity.

2The Board ruled that the Appellant would present the evidence to the Board and his father could assist as required.

ISSUE

3The appeals before the Assessment Review Board ("Board") were filed by Michael Chiaravalle (the “Appellant”) in respect of the assessment of a single, detached family home located at 278 Valridge Drive, the subject property (“SP”), for the 2017 and 2018 taxation years.

4The two-storey 5,861 square foot ("sq. ft.") home was built in 2013. There is 2,570 sq. ft. on the first floor and 3,291 sq. ft. on the second floor. The basement is measured at 2,570 sq. ft. It is situated on an irregular shaped lot sized 12,283.34 sq. ft. or 0.28 of an acre. The Quality Class ("QC") is 8.0. There is an attached four car garage measuring 1,170 sq. ft. and a shed measuring 542 sq. ft. There is an in-ground pool. The home has been designated as being “overbuilt for the neighbourhood” and there is a 10% negative adjustment applied to the assessment for this designation.

5Tim Oberle, representing MPAC, entered four sales of comparable properties that he said were good comparators to the SP. He said that he had to expand the vicinity to capture these sales as the SP was designated as overbuilt for the neighbourhood and there were no comparable sales in the immediate vicinity. He said that his opinion of value of the SP was $1,641,000. He said he used the direct sales comparison approach to value to determine the assessment of the SP to be $1,568,000 for the 2017 taxation year. He said that $1,411,000 had been offered to but rejected by the Appellant at the Request for Reconsideration (“RfR”) stage. He said that he was going to honour that value and recommended the Board reduce the assessment of $1,568,000 for the 2017 taxation year to $1,411,000 and confirm that value for the 2018 taxation year.

6Michael Chiaravalle, representing himself, entered a large volume of evidence that included the sales of four comparable properties that had been prepared for the Appellant by an outside party, who was not present to testify. The Appellant said that the sales he was presenting were more representative of current value than those presented by MPAC. He asked that MPAC’s comparable sales be rejected. He agreed with MPAC’s designating the SP as overbuilt for the neighbourhood and agreed that a 10% negative adjustment was fair. He said that he believed a more fair valuation of the SP was $1,200,000 and asked the Board to reduce the assessment to that value.

7The issue before the Board for determination is whether the assessment of the SP for the 2017 taxation year and 2018 taxation year is at current value and whether the assessment is equitable with the assessment of similar lands in the vicinity.

DECISION

8The Board is required by s. 44.(3) of the Assessment Act, R.S.O, 1990, c. A31 (“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.

9The Board finds that the current value of the SP as of January 1, 2016, is $1,379,000. Therefore, the Board will reduce the assessment to $1,379,000 from $1,568,000 for the 2017 year and from $1,411,000 for the 2018 taxation year and finds that it is equitable with the assessments of similar lands in the vicinity.

REASONS FOR DECISION

Relevant Legislation

10Section 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

11Mr. Oberle’s valuation report was entered into evidence as Exhibit 1 and his Equity Analysis as Exhibit 2. He testified that the direct sales comparison approach to value was used in determining the current value of the SP.

12Mr. Oberle entered the sales of four comparable properties that he opined were good comparators to the SP. He said that as the SP was unique in its’ current location it had been designated as overbuilt for the neighbourhood and a 10% negative adjustment had been applied to the assessment and would remain so going forward. He said that as this was a unique property with no other comparables that had been sold in the homogenous neighbourhood he had to expand the vicinity to capture relevant sales. He said that despite the comparable properties not being in the same homogenous neighbourhood, they were within 2.5 kilometres of the SP. He said that they were all relatively comparable to the SP in building and lot size, all had the same QC at 8.0 and all were the same structure type. He testified that all had recent sales and that the prices had been time adjusted (“TAS”) to the valuation date of January 1, 2016.

13Mr. Oberle entered an Equity Analysis Report in which he examined the sales of 30 similar lands located within one kilometer of the SP. He testified that the median Assessment to Sales Ratio (“ASR”) returned at 0.98, which indicated to him that similar lands in the vicinity were being assessed at or near their correct current values.

14Mr. Oberle summed up his presentation by asking the Board to reduce the assessment of the SP for the 2017 taxation year from $1,568,000 to $1,411,000 and confirm the assessment at that value for the deemed 2018 taxation year.

Appellant’s Position and Evidence

15Mr. Chiaravalle, representing himself, entered a substantial documentary package into evidence as Exhibit 3. In Exhibit “B” of Exhibit 3 the Appellant outlined the reasons that he believes the SP is worthy of a negative adjustment. They include:

• effective lot frontage dispute with MPAC’s data,
• traffic adjustment for closeness to Highway 403 and other area traffic patterns that affects the quiet enjoyment of the property,
• SP overbuilt for the neighbourhood and a report from Schinkel Real Estate attesting to how they arrived at that conclusion,
• assessed values per square foot analysis with five properties that the Appellant opines are similar to the SP.
• the Appellant’s opinion that a fair assessment of the SP is between $900,000 and $1,000,000.

16In Exhibit “C” of Exhibit 3 Mr. Chiaravalle introduced a letter from A.T. McLaren Limited, Legal and Engineering Surveys. This letter purports to advise that the projected lot frontage is 16.417 metres or 53.86 feet. This is in conflict with MPAC’s evidence that the SP’s frontage measurement is 79.63 feet. The letter was completed by S.D. McLaren. However, this person was not at the hearing to introduce this letter nor did the Board have a curriculum vitae (“cv”) presented attesting to Mr. McLaren’s education, training, and experience in the area of land measurement.

17In Exhibit “E” of Exhibit 3, Mr. Chiaravalle introduced a report by Robert J. Schinkel of Schinkel Real Estate & Appraisals Inc. Brokerage. This report offered an opinion that the SP was overbuilt for the neighbourhood and consequently suffered a negative value impact. However, as he agreed with MPAC’s applying a 10% negative adjustment to the SP’s assessment and was not seeking a further adjustment the Board did not consider this report.

18In Exhibits “J” and “K” of Exhibit 3, Mr. Chiaravalle outlined his concerns about the amount of increase between the 2012 and 2016 valuation dates for the SP and five other properties located on Valridge Drive.

19In Exhibit “L” of Exhibit 3, Mr. Chiaravalle included an Appraisal Report for the SP prepared by Alex Del Sordo of Humphreys Appraisal Services Inc. This report used the Direct Comparison Approach to Value to arrive at a retrospective estimated market value of the SP, as of the January 1, 2016 valuation date to be $1,250,000. The report used the recent sales of four properties in the vicinity that the author opines are good comparators to the SP. On page 16 of 20 of Exhibit “L” the author analyzes the properties and then offers an opinion on how they compare to the SP. However, when recommending how the sales prices may be affected the author uses terms like “a positive adjustment to the sale price is deemed warranted for Comparable 1. Overall, a large negative adjustment to the sale price is deemed warranted for Comparable 2.” She makes similarly worded recommendations for the other two comparable properties. There is no guidance for the Board as to what a “large negative adjustment” or “a positive adjustment” might be. Additionally, the author was not present to introduce and explain the report nor was a “cv” introduced that attested to the education, training and experience of the author that would indicate to the Board that they were qualified to render an opinion.

20It should be noted that the issue of not having the authors present or their curriculum vitae included was made known to the parties at the hearing. Subsequent to the hearing the Appellant’s father sent a copy of Ms. Del Sordo’s “cv” to the Board requesting that it be included in their evidence.

21Mr. Chiaravalle completed his presentation by testifying that he wanted a fair assessment of the SP and that he wanted to be treated fairly in comparison to his neighbours. He asked the Board to disregard MPAC’s comparable properties as they were too far removed from the SP and consider the comparable properties in the report submitted by Ms. Del Sordo, as they were closer to the SP. He asked the Board to reduce the assessment of the SP to $1,200,000.

Board's Deliberations - Current Value

22The best evidence of current value is the sale of the subject property 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.

23The Board has carefully considered the testimony of the parties and the documentary evidence tendered as exhibits.

24The Board, when comparing properties, does not expect exactness or sameness. Therefore, the Board looks at similarity of characteristics, amenities and location to determine comparability.

25The 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.

26MPAC entered the sales of four properties located within a 2.5 kilometre radius of the SP. The assessor testified that he had to expand the vicinity as the SP had been designated as overbuilt for the neighbourhood and there were no sales of comparable properties to use. He said that all of the comparable were, in his opinion, relatively comparable to the SP. All were the same structure type, all had the same QC rating of 8.0, all had similar building and lot sizes and all had recent sales. The only significant difference between the SP and Sales 1 and 3 is the year built. However, as these are high value homes with a QC of 8.0, the Board is of the opinion that they are more similar than dissimilar. Therefore, the Board accepts the assessor’s explanation of why he had to expand the vicinity and will consider all four of these properties.

27The comparable properties are reflected below in Table 1.

28The assessor entered an Equity Analysis whereby he examined the sales of 30 properties located within five kilometres of the SP. His analysis determined that the median ASR was 0.98. This indicated to him that similar lands in the vicinity were being assessed at or near their correct current values and no adjustment was required for equity.

29Mr. Chiaravalle submitted a voluminous amount of material for the Board’s consideration and raised several issues.

30The Board will deal with the reports and letters submitted by Mr. Chiaravalle that had been prepared by third parties. It would be ideal, from the Board’s perspective, to have the author of such documents present to testify. In the alternative, the Board would appreciate having the authors “cv” included so that it can have some confidence that the author does have the necessary education, training and experience to offer an opinion. The Board did not have the benefit of any of these options. The Board also excluded Ms. Del Sordo’s “cv” that was sent to the Board after the hearing was completed. This would have been considered new evidence and neither MPAC or the Board would have had the opportunity to ask questions as to its provenance.

31The Board therefore, will place no weight whatsoever on the letters and reports submitted by S.D. McLaren, Robert J. Schinkel, and Alex Del Sordo.

32Mr. Chiaravalle argued that MPAC’s data relating to the effective frontage measurement of the lot was in error. He entered a report from A.T. McLaren Limited that opined that the correct effective frontage measurement was 53.86 feet as opposed to MPAC’s measurement of 79.63 feet. However, the Board has already ruled that it will place no weight on this report for the reasons noted above. The Appellant did not offer any evidence that he had measured the lot frontage and found it to be in error. Therefore, the Board accepts MPAC’s evidence that the effective frontage of the lot is 79.60 feet.

33Mr. Chiaravalle argued that there ought to be a negative adjustment to account for traffic patterns and closeness to the 403 Highway, which affects the quiet enjoyment of the property. The assessor testified that MPAC had applied a 10% positive adjustment to the assessment for abutting green space and a 10% negative adjustment for abutting the 403 Highway. He said that both of these adjustments cancelled each other out and no further adjustments were necessary. The Appellant did not present any evidence that would support his assertion that a negative adjustment was warranted to account for a heavy traffic pattern. Neither did he provide any evidence that supported his request for a negative adjustment greater than the 10% already provided by MPAC for abutting the 403 Highway. Therefore, the Board accepts the adjustments applied to the assessment by MPAC.

34Mr. Chiaravalle argued that there had been significant increases in the assessed value of the SP and of other area properties between the 2012 and 2016 valuation dates.

35Market conditions may change between valuation days, and while the Board acknowledges Mr. Chiaravalle’s dismay with the assessment increases 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.

36Mr. Chiaravalle submitted an assessed value per square foot analysis using five properties that he opined were similar to the SP. However, there were no recent sales of these properties. Therefore, the Board will not consider these five properties.

37Mr. Chiaravalle implored the Board to render a decision that treated him fairly in relation to his neighbours. Yet, he presented evidence that identified the SP as being overbuilt for the neighbourhood and accepted a negative adjustment applied by MPAC. He agrees that the SP is different from others in the neighbourhood yet asks that MPAC’s comparable properties be excluded in favour of the properties that he suggests are more comparable. Mr. Chiaravalle cannot have it both ways; either the SP is unique in its’ current location and a negative adjustment is warranted or it is not. As he agrees with MPAC’s designation and accepts the adjustment then he must also accept MPAC’s assertion that there were no comparable properties in the immediate vicinity of the SP and the assessor had to expand the vicinity to capture relevant sales.

38As Mr. Chiaravalle had no comparable sales properties to provide for the Board’s consideration, the Board is left to consider MPAC’s four sales comparable properties.

39These properties are:

Table 1

Property	Building Size (Sq. ft.)	Lot Size (Acres)	Year Built	Quality Construction (QC)	Sale Date	Time Adjusted Sale Price (TAS)	Current Value Assessment (CVA)
Subject Property	5,861	0.28	2013	8.0			$1,411,000
Sale 1	4,205	0.29	1988	8.0	June 2015	$1,280,091	$1,234,000
Sale 2	3,531	0.24	2011	8.0	January 2015	$1,074,476	$1,096,000
Sale 3	5,267	0.49	1986	8.0	November 2016	$1,654,752	$1,421,000
Sale 4	3,356	0,3	2015	8.0	December 2015	$1,507,750	$1,093,000

40The Board acknowledges the relatively minor differences between the SP and the comparable properties but finds that as all are high value homes, they are more similar than dissimilar. All of the properties have attached garages. The assessor testified that he had to expand the vicinity in order to find property sales that were comparable to the SP.

41The Board, in considering the comparable properties, recognizes the unique nature of these homes. They are all high value homes that command significant sales prices. The Board only has comparable properties from MPAC to consider. All of the comparable properties had recent sales and the purchase price having been time adjusted to the valuation date. In determining the current value of the SP the Board will utilize the TAS prices of the comparable properties.

42The Board totalled the TAS prices of the comparable properties and then averaged that total, arriving at a value of $1,379,267, or $1,379,000 rounded. This value falls within the range of the TAS prices of the comparable properties of $1,074,476 to $1,654,752.

43The Board finds that the current value of the SP is $1,379,000 (rounded).

Board’s Deliberations – Equity

44MPAC entered an equity study into evidence whereby the sales of 30 similar properties located within 5.0 kilometres of the SP were analyzed. The assessor determined that the median ASR returned at 0.98 and that this fell within MPAC’s ideal range of 0.95 to 1.05 which indicates that similar lands in the vicinity are being assessed at or near their correct current values.

45This Board accepts this equity analysis as the Appellant did not present any equity evidence to dispute it.

CONCLUSION

46The Board finds the current value of the SP to be $1,379,000. The Board therefore reduces the assessment of the SP from $1,568,000 to $1,379,000 for the 2017 taxation year and reduced the assessment from $1,411,000 to $1,379,000 for the 2018 taxation year. No adjustment is required for equity.