Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: November 20, 2019

FILE NO.: WR 162692

Assessed Person(s): J.L.B.

Applicant(s): J.L.B.

Respondent(s): City of Hamilton

Property Location(s): Withheld

Municipality(ies): City of Hamilton

Roll Number(s): Withheld

Appeal Number(s): 3369584

Taxation Year(s): 2018

Hearing Event No.: 724465

Legislative Authority: Section 357.(1)(d.1) of the Municipal Act, 2001, S.O. 2001, c. 25, as amended

Heard: November 1, 2019 in Stoney Creek, Ontario

APPEARANCES:

Parties	Representative
J.L.B.	Self-represented
City of Hamilton	Irwin Sampat

DECISION OF THE BOARD DELIVERED BY MARGARITA OKHOVATI

INTRODUCTION

1J.L.B. (the “Applicant”) filed an application to the City of Hamilton (the “City”) to have her 2018 property taxes reduced, cancelled or refunded because she was unable to pay due either to sickness or extreme poverty under section 357(1)(d.1) of the Municipal Act, 2001, S.O. 2001, c.25 as amended (“Act”).

The City has passed a by-law delegating its authority to determine such applications to the Assessment Review Board (the “Board”) under s. 357. (11) of the Assessment Act, R.S.O. 1990, c. A.31.

ISSUE

2The issue before the Board is whether the Applicant’s 2018 property taxes should be cancelled, reduced or refunded because of the Applicant’s inability to pay due to sickness or extreme poverty. This requires the Board first to determine, based on the evidence adduced in the hearing, if the Applicant was unable to pay her 2018 property taxes. If the Board determines she was unable to pay her property taxes, the Board must then determine whether the reason she was unable to pay was due to either sickness or extreme poverty.

DECISION

3The Board finds that the Applicant did not demonstrate that she was unable to pay the 2018 property taxes. The Application is dismissed.

REASONS FOR DECISION

Evidence and Analysis

Ability to Pay

Applicant’s Submissions

4The Applicant is a 38-year old single woman who was never married. She stated that she resides in a four bedroom and two and a half bathrooms detached house with her six children (aged 4 to 16 years). She testified that her oldest child was with one partner who left Canada for Mexico and the other 5 children were with the second partner, who never came to live with the family. She testified further that she filed a court case against the second partner for child support and financial assistance however, the case was dismissed. She further added that sometimes her aunt helps her financially whenever she needs it but receives no assistance from her former partners.

5The Applicant testified that she works as an administrator, tax manager and book keeper in a company. She stated that in 2018, she started a business but because it was very demanding and she could not manage it, she closed it down. For the purpose of this business venture, she purchased a 2014 Dodge Ram truck while she was in possession of a 2015 GMC Yukon SUV. Presently, she drives the GMC Yukon SUV on daily basis while the Dodge Ram truck is sitting in her driveway since July 2018 without being used.

6The Board has to determine if the Applicant would have been able to pay her property taxes by reviewing the financial resources available to the Applicant.

Applicant’s Financial Evidence

7The Applicant submitted a copy of her financial statement and provided evidence also at the hearing regarding her monthly income and expenses, assets and liabilities as detailed hereunder:

Income Total $7,397.69/month

Expenses

a. Mortgage $1,717.98

b. Property taxes $ 363.71

c. Fuel $ 77.66

d. Hydro/water $ 187.55

d. Home/car insurance $ 311.83

e. Car payment $ 195.36

f. Gas for car $ 450.00

g. Food $ 1,600.00

h. Telephone/Cable/Internet $ 466.86

i. Other expenses (clothing, children’s activities, house maintenance) $ 1,386.57

j. Bank fees $ 19.95

k. Trailer expenses $ 202.00

Expenses Total $6,979.47/month

Net Total $ +418.22/month

Assets

Designated value of the subject property in 2018 $ 436,000

2015 GMC Yukon SUV $ 35,000

2014 Dodge Ram $ 20,000

Trailer $ 8,000

Assets Total $ 499.000

Liabilities

Two mortgages $ 414.856

Credit Cards $ 19,399

Dodge Ram truck $ 22,000

Liabilities Total $ 456,255

NET WORTH TOTAL $+ 42,745

8Based on the information set out above, the net worth of the Applicant is $42,745.

Applicant’s Final Remarks

9“I have nothing to add to my oral testimony.”

City’s Submissions

10Irwin Sampat, on behalf of the City submits that the City does not support this application for the Applicant had the ability to pay her 2018 property taxes for the following reasons:

• The Applicant was able to pay her 2018 property taxes with no interest.
• The Applicant is in possession of a truck worth $20,000, for which she pays insurance and other expenses without using it.
• The Applicant’s income is greater than her expenses.
• These applications are for the Applicants who are unable to pay their property taxes after exhausting all the resources available to them. City expects to collect its taxes by offering all the services to its property owners.

Board’s Analysis

11The intent of the legislation is to provide relief for property owners who cannot pay their property taxes in full or in part due to sickness or extreme poverty in a given taxation year. If the Applicant proves an inability to pay the taxes, they must then prove the reason why they cannot, and only then can relief be granted. In this application, the Board must decide if the Applicant was unable to pay all or part of her property taxes. This requires a contextual analysis of the Applicant’s income and expenses and an examination of all financial resources available to her in 2018. This will be used to determine if she could have mitigated her property tax obligations.

12The Board notes that there is significant amount of Electronic Transfers into the Applicant’s accounts and when asked under cross-examination to explain the source of the funds, she stated that she receives financial assistance from her aunt and sometimes from the father of her five children. The Board notes that in her testimony, the Applicant initially stated that she never received financial help from either her partners which was clearly inconsistent with her subsequent evidence under cross-examination

13As mentioned above, the Applicant is in possession of a 2015 GMC Yukon SUV with the value of $35,000, which she drives every day and a 2014 Dodge Ram Truck, which she purchased to use it strictly in her business venture with the value of $20,000 with monthly expense of $477. This truck sits idly in her driveway without being used since July 2018. When asked why she did not sell this truck to help her financially, she stated that she had to fix it first and that she has the intention of selling it this year. She later stated that she drove it until June 2019. The Board notes that the discretionary monthly expenses of this truck are sufficient to cover the Applicant’s monthly property taxes of $363.71.

14Furthermore, the Applicant owns a mobile home trailer for which she pays $2,000 to park her trailer at a mobile home park plus $300 for winterizing and $120 for Hydro annually to use it for the family in summer time. This discretionary spending related to the mobile home trailer totals $2,420.

15The Board has reviewed all the evidence pertaining to the financial situation of the Applicant to determine whether she is experiencing extreme poverty and therefore unable to meet some or all of her tax obligations. As determined by the Board in M. M. U. v Toronto (City), 2015 CanLII 46826 (ON ARB):

… to qualify for relief under this section of the Act the condition cannot be one where an individual simply cannot make ends meet but amounts to a situation where the Applicant after having called upon every resource available to him and having applied every reasonable means to mitigate and manage his expenditures is left with no means of being able to pay some or all of their property taxes. In the Board’s view the envisages that an individual seeking relief on application under s. 357 of the Act should clearly demonstrate that for the year under appeal the Applicant, after scrupulously managing his/her resources and expenditures, was left with no resources available to meet his/her obligations to provide for the basic necessities of living and at the same time pay some or all of his/her property taxes.

16The Act envisages a situation thereby, after calling upon all financial resources available to the Applicant, the Applicant is still unable to pay all or part of the property taxes. Applications under this section of the Act are of last resort and Applicants must be in dire need to obtain relief.

17Reviewing the Applicant’s credit card statements, the Board finds that the Applicant’s expenditures with respect to eating outside, using beer and liquor stores often, buying expensive games and toys for the children and going to trips, in addition to the high level of discretionary spending does not demonstrate that the Applicant is in extreme poverty and is unable to pay her monthly property taxes of $363.71.

18Moreover, as stated above, the Applicant’s monthly income is greater than her expenses and this will enable the Applicant to cover her monthly property taxes.

19The Board notes also that the Applicant has paid her 2018 property taxes in full and has still engaged in a high level of discretionary spending including spending $20,000 on the 2014 Dodge Ram truck which is unused; and paying $2,420 annually for the expenses of an unessential mobile home trailer. The Board finds that this evidence indicates that the Applicant was not unable to pay her 2018 property taxes.

CONCLUSION

20Based on the reasons stated above, the Board finds that the Applicant had the financial ability to pay all her expenses including her 2018 property taxes.

21The Board therefore, dismisses the Applicant’s application for a refund of all or part of her 2018 property taxes.