Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: November 14, 2019

FILE NO.: RD 2019M23

Assessed Person(s): Steven Kristopher Kenney; Lorraine Eveline Beagan

Appellant(s): Lorraine Eveline Beagan

Respondent(s): Municipal Property Assessment Corporation (“MPAC”) Region 07

Respondent(s): City of Kawartha Lakes

Property Location(s): 15 Cop’s Cove

Municipality(ies): City of Kawartha Lakes

Roll Number(s): 1651-026-020-45300-0000

Appeal Number(s): 3235637 and 3292941

Taxation Year(s): 2017 and 2018

Hearing Event No.: 704467

Legislative Authority: Rule 123 of the Assessment Review Board’s Rules of Practice and Procedure, as amended

Request for: A review of the Board’s Decision WR 157694 issued on February 5, 2019

Heard: By written submission

Parties	Counsel+/Representative	Submissions
Steven Kristopher Kenney; Lorraine Eveline Beagan	Cynthia Davis+	Requester
MPAC	William Jon White	Received
City of Kawartha Lakes		Not Received

DECISION DELIVERED BY PAUL MULDOON AND ORDER OF THE BOARD

INTRODUCTION

1Steven Kristopher Kenney and Lorraine Eveline Beagan (the “Requesters”) request a review of a decision of the Assessment Review Board (“Board”) issued on February 5, 2019 (the “Decision”), where the Board returned assessments of their property (the “Subject Property”) of $480,000 for the 2017 taxation year and $486,000 for the 2018 taxation year.

2The Presiding Member, in determining the current value of the Subject Property, relied on the direct comparison approach and found that two of the properties presented by MPAC were comparable to the subject property. The Board determined no equitable reduction was required.

3Two of the issues before the Board in the Decision related to whether and what quantum of reductions should be applied to the Subject Property. Specifically, the Board decided the following:

1. The property was subject to a 35% reduction for weedy shoreline, ravine type and flood plain area (the “35% reduction”); and
2. A previous $10,000 reduction for abutting commercial properties was no longer necessary (the “$10,000 reduction”).

4It is these two findings that the Requesters are asking the Board to review. The Requesters ask the Board to vary the decision or, in the alternative, that the Board order a rehearing of the determination of the current value of the Subject Property. The Requesters also raise a third issue, namely, that there was breach of procedural fairness because they submit that they were not permitted to cross-examine a MPAC witness or introduce certain evidence.

5For the reasons set out below, the Board finds that:

a. Regarding the $10,000 reduction, the Board did not make a significant error such that the Board would have reached a different decision. b. Regarding the 35% reduction, the Board made an error of law such that the Board would likely have reached a different decision. c. It is not necessary to address the procedural fairness grounds raised by the Requesters.

RELEVANT RULES

6The grounds for a Request for Review are set out in Rule 121 of the Board’s Rules of Practice and Procedure (the “Rules”). A Request for Review will not be granted unless the Board is satisfied that one of the criteria in Rule 121 are met. The grounds listed in Rule 121 are as follows:

Grounds for Review

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.

The Requester is relying on grounds listed in Rule 121 (a) and (b) as noted above.

ANALYSIS

Issue: Whether there should be a $10,000 Reduction for being located to an abutting property necessary?

7Regarding the $10,000 reduction, the Requesters submit that the Board made the following significant errors of law or fact:

1. The Board failed to apply the $10,000 adjustment and failed to provide a proper reason for this; and
2. The Board shifted the onus of proof with respect to establishing the ongoing neighbouring commercial operations.

8Paragraph 48 of the Decision sets out the Board’s findings with respect to the $10,000. The Board clearly considered both parties’ evidence and submissions and the case law presented with respect to whether or not the Board should stray from the prior Board decision, which applied a $10,000 reduction.

9There is no dispute that MPAC’s witness testified at the hearing that when he visited the Subject Property, he did not witness commercial activities in the abutting lands. This was MPAC’s evidence and the Board accepted this evidence. The Requesters then testified that commercial activities are seasonal and MPAC’s witness visited off season. The Board did not accept the Requesters’ evidence and gave it no weight. It is clear from the Board’s decision that the Presiding Member may have given the evidence more weight if it were corroborated, but she preferred MPAC’s evidence over the Requesters’ – this was something that was open to her to do. Further, accepting one party’s evidence but wanting further corroborating evidence from the other party is not a shifting of the onus.

10The Presiding Member considered the evidence, made a decision, and provided a reason for her decision. Although a more detailed explanation with clearer language may have been helpful, tribunal decisions are not held to a standard of perfection, and it is clear what the Board decided and why. The Board does not find there to be an error in fact or law with the Decision on this point, and no error significant enough that the Board would likely have reached a different decision. The Board confirms the decision on this point.

Issue: Whether there was a 35% Reduction

11The Requesters allege the Board made the following significant errors of law or fact:

1. The Board failed to apply the 35% adjustment after determining the current value;
2. The Board erred in accepting the Assessor’s uncorroborated evidence that the 35% adjustment had been applied prior to the assessment of current value; and
3. The Board shifted the onus of proof with respect to establishing the negative characteristics of the comparable properties.

12It is clear that the Board did not apply the 35% adjustment after determining the current value. However, it is not clear on the face of the decision that that was an error – it is possible that the 35% was applied earlier.

13The Board utilized the direct comparison approach to determine the current value of the Subject Property. The Presiding Member relied on the time-adjusted sale prices of two comparable properties submitted by MPAC and calculated the average of those two numbers. After performing this calculation, the Board did not reduce the value by 35%.

14MPAC submits that the 35% reduction was included in MPAC’s assessment. However, the Decision does not indicate that the reduction 35% was included in MPAC’s assessment. It is not clear whether MPAC provided further explanation at the first instance hearing how or when the 35% was included.

15More importantly, in its submissions, MPAC provided no explanation for how or when the 35% would or could have been included in the Board’s assessment, especially given that the Board’s assessment was based on a calculation of time-adjusted sales values. While it is possible that the 35% reduction was included in the Board’s assessment, it appears that it would have to be that the reduction was either included in MPAC’s sale information or in the choice of comparators. At this point, the Board is unable to determine whether the reduction was included and if so, when.

16If the 35% reduction, which the Presiding Member found was appropriate, was not applied at all, this would be an error such that would have led the Board to reach a different decision regarding the valuation. If the reduction was applied, there is a lack of clarity in the Decision. Without being able to see what decision was made or how the Board reached its decision, it is not possible to determine the line of reasoning or the findings of the Board, and this does not give the parties a meaningful opportunity to understand what occurred here or provide meaningful review of the decision.

17In light of this finding, the Board orders a rehearing with respect to the valuation of the Subject Property.

Whether there Was a Breach of Procedural Justice

18The Requesters allege that the Board violated the rules of natural justice or procedural fairness by not allowing the Requesters:

a. To cross-examine the Assessor about the comparable properties; or b. To present evidence about the comparable properties.

19Specifically, the Requesters argue that had they been given the opportunity to introduce this evidence, it would have established that only the Subject Property is subject to the negative characteristics and it would have been clear that the 35% reduction remained to be applied to the Subject Property.

20I do not feel it is necessary to make a decision regarding procedural fairness (or this alleged error of law). Because I am ordering a rehearing on the issue of the valuation, any procedural unfairness that may have occurred would be remedied by a new hearing on the matter.

ORDER

21Pursuant to Rule123, the Board confirms the finding that no $10,000 reduction is required and a new hearing is ordered with respect to the valuation of the Subject Property.