C.M.L. v. City of Hamilton, 2020 CanLII 103258

Tribunals Ontario Tribunaux décisionnels Ontario

Assessment Review Board Commission de révision de l’évaluation foncière

ISSUE DATE: December 14, 2020

FILE NO.: WR 166847

Assessed Person(s): C.M.L.

Applicant(s): C.M.L.

Respondent(s): City of Hamilton

Property Location(s): Address withheld

Municipality(ies): City of Hamilton

Roll Number(s): Roll number withheld

Appeal Number(s): 3415501

Taxation Year(s): 2019

Hearing Event No.: 734064

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

Parties	Representative
C.M.L.	E.W. and M.L.
City of Hamilton	Linda Nimako and Irwin Sampat

HEARD: October 29, 2020 by telephone conference call

ADJUDICATOR(S): Subuola Awoleri, Member

DECISION

OVERVIEW

1C.M.L. (the “Applicant”) filed an application to the City of Hamilton (the “City”) to have her 2019 property taxes reduced, cancelled or refunded because she was unable to pay these taxes due to either sickness or extreme poverty under s. 357(1)(d.1) of the Municipal Act, S.O. 2001, c.25 (the “Act”). The City passed a by-law delegating its authority to determine such applications to the Assessment Review Board (the “Board”).

2The subject property is a single-family row townhouse, built in 1919. It has two bedrooms and an artic compartment, which can also be used as a bedroom. The property taxes levied on the subject property in the 2019 taxation year was $1,728.95. The Applicant benefited from a credit from a prior application for relief under the Act, in the amount of $737.99, which the City applied to the 2019 property tax account. The Applicant paid the balance of $990.96. The Applicant is requesting that the Board orders the City to refund $990.96.

3At the completion of the hearing, the Board provided an oral decision. The Applicant thereafter requested written reasons.

ISSUES

4The Board must determine if all or part of the Applicant’s 2019 property taxes should be refunded as a result of the Applicant’s inability to pay due to sickness or extreme poverty. In order to make this determination, the Board must determine:

a) if the Applicant was unable to pay all or part of her property taxes;

b) if the Board finds that she was unable to pay all or part of her property taxes, the Board must determine if the inability to pay was due to either sickness or extreme poverty.

Result

5The Board finds that the Applicant was able to pay all her 2019 property taxes.

6The Board determines that this Application does not qualify for relief and dismisses the Applicant’s application for a refund of property taxes for the 2019 taxation year.

ANALYSIS

Issue 1a – Ability to Pay

7A determination by the Board of the Applicant’s ability to pay her property taxes requires a contextual analysis of the Applicant’s income and expenses and an examination of all the financial resources available to her in 2019. This will be used to determine if she could have mitigated her property tax obligation.

Income

8The Applicant is 62 years old. Her source of income includes a monthly amount of $1,269.00 from the Ontario Disability Support Program (“ODSP”). The Applicant also earns $50.34 per month for delivering flyers once a week. In 2019, the Applicant received a one-time rebate in the amount of $2,000, as part of an Indigenous treaty settlement for out-of-pocket expenses. The City submits that this amount should be included as part of the Applicant’s income. The Applicant disagrees, submitting that this is not part of her income and it negates the treaty settlement, by including it as part of her income.

9In E.B. v. Toronto (City), [2016] O.A.R.B.D. No. 142 at paragraphs 19 and 20 the Board determined that:

… These applications are of last resort and the Applicant must have depleted all resources before making such an application. The Applicant must demonstrate in her applications, that after managing her resources and expenditures, she has no further resources to meet the basic necessities of life in addition to paying all or some of her property taxes.

10Furthermore, in S.C. v. Whitby (Town), [2016] O.A.R.B.D. No. 55 at paragraph 37, the Board determined that:

… the threshold for individuals who claim an inability to pay their property taxes because of sickness cannot simply be that the individuals are unable to make ends meet. The individuals must demonstrate that after having called upon every resource available to them and having explored every reasonable opportunity to mitigate their financial stresses, they have no means of being able to pay some or all of their property taxes.

The Board is of the view that the Act envisages that an individual seeking relief on application under s. 357(1)(d.1) of the Act should clearly demonstrate that for the year under appeal the Applicants had no resources available to meet their obligations to provide for the basic necessities of living and at the same time pay some or all of his/her property taxes.

11These decisions and other precedents of the Board envisage that Applicant’s must utilise all financial resources available to them to mitigate their property tax obligation and still be unable to pay all or some of their property taxes in order to qualify for relief under the Act. Accordingly, the Board finds that for the purpose of Applications made under this section of the Act, the one-time payment rebate of $2,000 serves as a financial resource the Applicant could use to mitigate her property tax obligation. This provides a monthly amount of $166.67, which is added as part of the Applicant’s income only for the purpose of this Application.

12The total monthly income for the Applicant is $1,486.01.

13Notwithstanding, as will be determined in this decision, even if the Board deducts this one-time payment of $166.67 per month from the Applicant’s monthly income, the Applicant will have a monthly income of $1,319.34. The Applicant will still have the ability to pay all her 2019 property taxes.

Expenses

14The Applicant’s monthly expenses in 2019 was $1,360.52. This provides a net income of $125.49 using the monthly income of $1,486.01. A detail of the Applicant’s expenses is provided in Table 1 below:

Table 1

Expenses (Monthly)	Amount ($)
Mortgage	397.75
Property tax	82.58
Fuel/Furnace	75.10
Hydro/Water	30.78
Telephone & TV	163.11
Insurance (House)	116.69
Reliance (rental for water heater)	48.47
Bank fee	4.00
Charitable Donation	17.04
Food	300.00
Clothing	50.00
Household Supplies	25.00
Transportation	25.00
House Repairs/maintenance	25.00
Total	$1,360.52

Assets and Liabilities

15The assessed value of the subject property in the 2019 taxation year by the Municipal Property Assessment Corporation (“MPAC”) was $156,000. The parties did not dispute this value.

16The value of the Applicant’s Registered Retirement Savings Plan (“RRSP”) as of September 2019 was $494.87. The Applicant also had a balance of $1,181.98 in her chequing account as of December 23, 2019.

17The Applicant’s financial statement is summarized in Table 2 below:

Table 2

Item	Amount ($)
Income	$1,486.01
Expenses	$1,360.52
Net Income	$125.49
Assets
Home (Destination Value from MPAC)	156,000
Bank Acct. (balance December 23, 2019)	1,181.98
RRSP	494.87
Total Asset	157,676.85
Liabilities
Mortgage	75,149.39
Credit Card (RBC)	4,732.73
Line of Credit	3,289.25
Total Liabilities	$83,171.37
Net Asset (Total Assets Less Liabilities)	$74,505.48

Basic Necessities of Living

18In T.I. v. Toronto (City), [2019] O.A.R.B.D. No. 165 (“T.I.”) at paragraph 29, the Board agreed with the City of Toronto that in deciding whether or not to grant a refund to an Applicant where the taxes have been paid, the Board should “consider whether the Applicant was able to provide for the basic necessities of life after paying his taxes”. The Board further determined that:

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.

19In T.I, the applicant paid his property taxes and testified before the Board that “had he not paid his property taxes, he would have been able to consider paying home insurance, a telephone, internet services and home roof repairs”. The Board determined at paragraph 30 that:

… despite the Applicant's very frugal and conscientious spending, the Applicant was unable to provide for the basic necessities of living after he paid his property taxes. The Board finds that the Applicant was therefore unable to pay his 2017 property taxes…

20Basic necessities of living are things that are of indispensable use to applicants. In the Applicant’s circumstances, in 2019, the Applicant testified that she paid $204.50 as membership fee to an organization, in addition to paying her property taxes. The Board will regard this payment as a charitable donation. This is a discretionary expense and not a basic necessity. In R.E. v. Toronto (City), [2019] O.A.R.B.D. No. 282 at paragraph 23 the Board determined that:

A discretionary expense does not constitute a basic expense of applicants making applications under this section of the Act. Applicants applying for relief can run their home or business without utilizing discretionary expenses.

21In E.D. v. City of Toronto, WR 128986 (unreported) (“E.D.”) at paragraph 29, the Board determined that discretionary expenses should not take precedence over the payment of property taxes.

22In this Application, the Applicant lived a frugal life within her means. Her 2019 expenses in Table 1 reveals that she could afford to pay for the basic necessities of life. The Applicant did not sacrifice any basic necessity of living in order to pay her 2019 property taxes. The Board finds that aside from the one-time payment rebate of $2,000 as part of an Indigenous treaty settlement for out-of-pocket expenses, the Applicant was able to pay all her 2019 property taxes and still afford to pay for the basic necessity of living. Therefore, this Application does not qualify for a refund.

Mitigation of Property Tax Obligation

23The Applicant could also have leveraged on the balance in her RRSP in the amount of $494.87 to mitigate her property tax obligation. As the Board determined in S.C., applicants must call upon all financial resources available to them and still be unable to pay their property taxes.

24The amount paid as charitable donation and the balance in the Applicant’s RRSP provides a total amount of $699.35. If this amount is deducted from $990.96, being the balance of the property taxes to be paid, the balance to be paid will be $291.61, making a monthly amount of $24.30. The Applicant further admitted that she had a closing balance of $1,181.98 in her chequing account as of December 23, 2019. Regardless of the one-time payment of $2,000 Indigenous treaty settlement, this shows that the Applicant had the ability to pay her property taxes. This reveals that this Application does not qualify for relief as the Applicant could have used all the financial resources such as her RRSP and the closing balance in her bank account to pay her property taxes, which she already paid in the 2019 taxation year.

Indigenous Treaty Rebate

25The Applicant’s monthly income without the treaty rebate of $2,000 will be $1,319.34, this provides a net income of ($-41.18). A deficit monthly net income does not automatically entitle the Applicant to a relief. In E.B. v. Toronto (City), [2016] O.A.R.B.D. No. 142, the Applicant was 81 years old and had a monthly deficit. The Board determined that she had not explored other financial resources in mitigating her property tax obligation.

26The Applicant paid her 2019 property taxes and was still able to afford the basic necessities of living and pay for discretionary expenses (a membership fee), therefore this Application does not qualify for relief.

CONCLUSION

The Board determines that the Applicant was able to pay all her 2019 property taxes. Having determined that the Applicant was able to pay all her 2019 property taxes, the Board does not need to determine the second sub-issue.

ORDER

27The Board dismisses this Application for the 2019 taxation year.