Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: September 17, 2019

FILE NO.: WR 162092

Assessed Person(s): A.L.

Applicant(s): A.L.

Respondent(s): City of Mississauga

Property Location(s): Withheld

Municipality(ies): City of Mississauga

Roll Number(s): Withheld

Appeal Number(s): 3344933

Taxation Year(s): 2018

Hearing Event No.: 722679

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

Heard: August 2, 2019 by teleconference call

APPEARANCES:

Parties	Representative
A.L.	M.L.
City of Mississauga	Sean Doyle

MEMORANDUM OF ORAL DECISION DELIVERED BY JEAN-PAUL PILON ON AUGUST 2, 2019

1A.L. (the “Applicant”) filed an application with the City of Mississauga (the “Municipality”) pursuant to section 357(1)(d.1) of the Municipal Act, 2001, S.O. 2001, c. 25, as amended (the “Act”). This provides that “upon application to the treasurer of a local municipality made in accordance with this section, the local municipality may cancel, reduce or refund all of part of the taxes levied on land in the year in respect of which the application was made if the applicant is unable to pay taxes because of sickness or extreme poverty.”

2The taxation year for which the Applicant sought, in this case, a refund of property taxes was 2018. Specifically, the property taxes levied on the Applicant’s land for the 2018 taxation year were $5,373.18. They were paid in full and therefore the remedy requested in this application was for a refund of taxes paid.

3Pursuant to section 357(11) of the Act, the Municipality has authorized the Assessment Review Board (the “Board”) to exercise the powers and functions of the municipal council in deciding these applications.

4At the hearing, the Applicant was represented by her son M.L.

5After hearing this application, the Board delivered an oral decision dismissing the application. This was because the Board determined that the Applicant was not unable to pay her property taxes in 2018.

6Following are the written reasons subsequently requested by the Applicant’s representative explaining why the application was dismissed.

Evidence

Missing Documentation

7The Applicant’s representative submitted financial documentation on the Applicant’s behalf for the period June, 2018 to June, 2019, not from January, 2018 to December, 2018 as would normally have been required in an application for relief for the 2018 taxation year, which is also the calendar year. The Board explained at the outset of the hearing that proceeding in the absence of documentation for the first part of 2018 might lead to adverse findings if credibility issues arose during the hearing. It was therefore suggested that the Applicant`s representative might want to consider requesting an adjournment so that the missing documentation could be retrieved and filed prior to the next hearing.

8The Applicant’s representative wanted to proceed with the hearing that day and did not request an adjournment. Ultimately there were no credibility issues that arose at the hearing, and the Board was satisfied that the Applicant had the same income and expenses for the first half of 2018 as she did in the second half of 2018.

The Applicant and her Financial Circumstances in 2018

9The Applicant is 99 years old. Her two sons, one of whom represented her at the hearing, reside outside of Ontario and assist the Applicant in her wish to remain at the home that is the subject of the application.

10The land referred to in the application is a house purchased in 1957 by the Applicant and her husband who died in 1998. The Applicant lives there alone.

11The Applicant’s income in 2018 was entirely composed of Old Age Security payments, Canada Pension Plan payments and provincial sales tax rebates totalling $1,686.10 per month, or $20,233.20 for the year.

12The Applicant’s monthly expenses were identified through her bank statements and her representative’s testimony as follows:

a. Gas for heating $111.00

b. Hydro and water $71.84

c. Telephone $63.15

d. House insurance $85.20

e. Medication $100.00

f. Food $450.00

g. Property taxes $447.00

h. Lifeline (emergency device) $31.64

i. Snow removal $300.00

Total: $1,659.83

13Calculated annually, these expenses amounted to $19,917.96.

14Subtracted from the Applicant’s annual income of $20,233.20, the Applicant had a surplus of $315.24 in 2018.

15The Applicant had two assets in 2018: her house, which was assessed at $718,000 for the 2018 taxation year, and a balance in her bank account as of December 31, 2018 of $7,040.71. These amounts totalled $725,040.71.

16The Applicant’s single liability was a reverse mortgage which was not being repaid. The Applicant’s representative testified that this reverse mortgage had been approved for $344,000 and that $161,000 had been drawn from it. The Applicant’s statement from HomeEquity Bank, however, indicated that the outstanding balance of the reverse mortgage as of December 31, 2018 was $108,272.02.

17With assets of $725,040.71 and liabilities of $108,272.02, the Applicant had a net worth of $616,768.69 at the end of 2018.

18The Municipality did not contest any of the evidence submitted regarding the Applicant’s 2018 financial circumstances.

Analysis

19The Act provides that a cancellation, reduction or refund of taxes should only follow “if the applicant is unable to pay taxes because of sickness or extreme poverty.” Therefore, the first question to be determined is whether the Applicant was unable to pay taxes in 2018. If the answer is no, the application would be dismissed because the Applicant could have paid the taxes in question or, in other words, was not unable to pay. If the answer is yes, the next question to be determined is whether that inability to pay taxes was because of sickness or extreme poverty. This is the approach used by the Board which is consistent with its recent decisions, most notably F.E.J.B. v. Mississauga (City), 2019 CanLII 59502 (ON ARB).

20The first question of whether the Applicant was unable to pay taxes has an additional element in this case in the fact that the Applicant paid the taxes that were due in 2018 in full. On this point, the Board refers to its decision in T. I. v Toronto (City), 2019 CanLII 29145 (ON ARB), where at para. 29 it was determined that a refund is appropriate if having paid taxes meant that the taxpayer was unable to pay for the basic necessities of living, in that case, a dangerous leaking roof:

The question before the Board was whether taxes should be refunded, not whether they should be cancelled or reduced. With this in mind, the City argued the Board should consider whether the Applicant was able to provide for the basic necessities of life after paying his taxes in deciding whether or not to grant a refund. The Board agrees that this is an appropriate way to approach the question of inability to pay taxes, where taxes have already been paid. If the Board finds in a case, that having paid his or her taxes, an applicant was left unable to pay for the basic necessities of living, a finding that an applicant was unable to pay taxes is a reasonable one where there is no inappropriate discretionary spending.

21In this case, the Applicant paid the taxes for the year and there was no evidence that the Applicant was unable to pay for any basic necessities of living. At the hearing, the Applicant’s representative acknowledged that the Applicant was not unable to pay those taxes. The evidence before the Board was that the Applicant had more than sufficient resources available to her in 2018 to meet her tax obligation. To be precise, after having paid the taxes in full for 2018, the Applicant still had a surplus of $315.24 in her bank account and substantial equity available through her reverse mortgage of $235,727.98 at the end of the year.

22The Board’s authority to order a refund of taxes in these applications is entirely set out in section 357(1)(d.1) of the Act where the threshold question to be determined is whether an applicant was unable to pay taxes for the year that is the subject of the application. It is not based on whether over the course of an applicant’s life the applicant has paid “their dues,” as was suggested here. Where an Applicant was not unable to pay taxes, the Board has no legal authority to grant any relief and the application must be dismissed. That was the case here, therefore this application was dismissed at the hearing.

CONCLUSION

23A.L.’s application to refund all or part of the taxes levied on land in 2018 because she was unable to pay taxes because of sickness or extreme poverty is dismissed.