Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: March 27, 2020 FILE NO.: DM 162551

Moving Party(ies): Soul Restaurants Respondent(s): Municipal Property Assessment Corporation Region 21 Respondent(s): City of Kitchener

Property Location(s): 951 Homer Watson Boulevard Municipality(ies): City of Kitchener Roll Number(s): 3012-040-028-09900-0000 Appeal Number(s): 3385955, 3385956 and 3385957 Taxation Year(s): 2017, 2018 and 2019 Hearing Event No.: 725584

Legislative Authority: Rule 73 of the Assessment Review Board’s Rules of Practice and Procedure

Parties	Counsel*/Representative
Soul Restaurants	Colin Francis
Municipal Property Assessment Corporation	Brittany Allen
City of Kitchener	Greg Demacio

REQUEST FOR: Appeal withdrawals HEARD: October 22, 2019 in writing ADJUDICATOR(S): Jean-Paul Pilon, Member

MOTION DECISION

OVERVIEW

1This written motion decision pertains to the request of Soul Restaurants (the “Moving Party”) to withdraw its appeals before the Assessment Review Board (the “Board”), a request that is objected to by Municipal Property Assessment Corporation (“MPAC”) and the City of Kitchener (the “Municipality”).

Issues

2The Moving Party frames its motion as requiring answers to the following six questions:

1. Can the Board’s Rules of Practice and Procedure (the “Rules”) be interpreted to provide for a party to a general proceeding to give a notice of higher assessment that returned by MPAC? And if the answer is no, is Rule 72(a) applicable to general proceedings?

2. Does the Board have jurisdiction to refuse the withdrawal of the appeals?

3. Is the requirement in Rule 38(7) a Special Notice provision?

4. Can the Board reinstate withdrawn appeals without an action by a party?

5. Does MPAC have the authority to alter the assessment roll during the tax year based solely on a change in opinion of the market value?

6. Regardless of the Board’s findings in questions 1 through 5, does Rule 73 allow the Board to grant a request to withdraw the appeals in the circumstances presented in this motion?

RESULT

3For the reasons that follow, the Board answers the first two questions in the affirmative, that a party to a general proceeding can serve a notice of higher assessment and the Board does have jurisdiction to refuse the withdrawal of appeals. The Board answers the third question in the negative, because Special Notices as the term is used in the motion do not exist in the Rules, and it answers the fourth question in the affirmative, only because of the particular circumstances which led to the issues in this motion. To the fifth question, the Board answers yes, that MPAC has the authority to alter the assessment roll during the tax year based solely on its change of opinion of market value. Finally, the sixth question need not be answered because the question has been asked and answered.

Background

4The Moving Party owns a commercial property at 951 Homer Watson Boulevard in the City of Kitchener. It filed an appeal of its assessment for the 2017 taxation year pursuant to section 40 of the Assessment Act, R.S.O. 1990, c. A.31 (the “Act”), and was deemed to have brought the same appeal for the 2018 and 2019 taxation years pursuant to section 40(26) of the Act. The appeals are general proceedings that were assigned a commencement date pursuant and a Schedule of Events and the Rules.

5On March 11, 2019, the Moving Party filed its Statement of Issues in the appeals.

6On August 27, 2019, the Municipality served its Statement of Response in which it indicated that it would seek a higher value for the property.

7On August 28, 2019, the Moving Party filed a letter with the Board in which it sought to withdraw the appeals.

8On September 3, 2019, MPAC filed its Statement of Response in which it also indicated it would seek a higher value for the property.

9Early in September 2019, the Board confirmed to the parties that the appeals had been withdrawn. A representative of the Municipality then wrote to the Board indicating that the Municipality opposed the withdrawal, and on September 9, 2019, the Board confirmed to the parties that the appeals had been reinstated.

The Board’s Rules of Practice and Procedure

10The applicable Rules are reproduced below for ease of reference, but also because they are important for the context of this decision.

11Rule 32 provides that all proceedings are general proceedings, unless the Board specifies a proceeding as a summary proceeding. This proceeding is a general proceeding and is subject to the Schedule of Events for General Proceedings set out in Schedule “A” to the Rules.

12Rule 73 provides that:

An appellant may seek an order from the Board, by motion, to withdraw an appeal that is prohibited by Rule 72 and the Board may:

(a) grant the request to withdraw, with or without conditions; or

(b) refuse to grant the request to withdraw and

i. proceed immediately to hear the appeal, or

ii. adjourn the proceeding.

13Rule 72 referred to in Rule 73 provides that:

An appellant may withdraw an appeal, with notice to the other parties to the appeal and the Board, unless:

(a) Another party has given notice pursuant to these Rules of its intention to request a higher assessment or higher tax rate property class; or

(b) a hearing event has commenced.

14The relief requested in the motion is that the Moving Party be allowed to withdraw its appeals.

15Rule 40 provides as follows:

A party to a summary proceeding must give notice to the Board, and all other parties to a summary proceeding, within 30 days of the day set in Rule 33 as the start of a proceeding, that the party intends to raise with the Board:

(c) A higher assessment than that returned by MPAC.

16Rule 38(7) provides that:

Statements of issues and responses must contain:

(7) If the issue is a higher assessment than that returned by MPAC:

(a) the basis on which a higher assessment is sought; and

(b) list of all facts, legal grounds and documents that the party relies on in support of its position.

ANALYSIS

The Merivale Decision

17Almost all of the answers to the Moving Party’s questions can be found in the Board’s decision in Merivale-Gilmour Manor Ltd. v. Municipal Property Assessment Corporation, Region 03, 2019 CanLII 72769 (ON ARB) (“Merivale”). The Moving Party indicated in its argument that a request for review in Merivale had been filed and remains undecided but, until any determination otherwise, Merivale remains part of the Board’s jurisprudence that can be applied, as it has been here.

18In Merivale, an appellant filed its Statement of Issues and the municipality then filed a Statement of Response in which it sought a higher assessment. This was followed by a request that was not on consent to withdraw the appeals. Unlike in this motion, however, the appeals were not withdrawn by the Board.

19The issues in that decision were mostly similar but compressed into three questions. These questions were essentially as follows:

a. Does the Board have jurisdiction to refuse the withdrawal of the appeals?;

b. Do the Rules allow for a party in the general proceeding stream to give notice of an intention to seek a higher assessment than returned by MPAC? If not, is Rule 72(a) restricting the right to withdraw from an appeal applicable in general proceedings?; and

c. Can a Notice of Higher Assessment be issued absent a physical or legal change as provided for in the Act?

20In reference to the first question, the Board determined that it could refuse the withdrawal of the appeals pursuant to Rules 72 and 73. To the second question, the Board determined at para. 41 of Merivale that “the Rules can be interpreted to allow a party to a general proceeding to notice of an intention to a seek a higher assessment that that returned by MPAC.” The answer to the third question was also yes, where at para. 48 of the decision it was determined that “notice of a higher assessment can be issued absent a physical or legal change on annual assessment,” as was the situation before the Board in this case.

This Motion

21With that background, the Board turns to the questions posed in this motion.

Question 1: Can a party to a general proceeding to give a notice of higher assessment than returned by MPAC? And if the answer is no, is Rule 72(a) applicable to general proceedings?

22The answer to this question is yes, a party to a general proceeding can give notice of higher assessment than returned by MPAC.

23The Board again refers to Merivale and relies on those reasons to answer the Moving Party’s first question.

24At para. 26 of Merivale, the Board reviewed Rules 72 and 73 and considered the appellant’s argument that there is no process in the general stream to seek a higher assessment similar to Rule 40 which is applicable to summary stream appeals. That decision also reviewed the differences between the Schedules of Events in both streams and explained the decision that Rule 38(7) permitted for a higher assessment to be sought which would bring Rules 72 and 73 into play. Merivale also concluded at para. 33 that “there is no confusion, ambiguity or tautology in this conclusion as argued by the Moving Party” and that “it is a plain reading of the Rules which provide that notice of an intention to seek a higher assessment can be contained in a party’s statements of issues and response.”

Question 2: Does the Board have jurisdiction to refuse the withdrawal of the appeals?

25The answer to this question is also yes: the Board has jurisdiction to refuse the withdrawal of the appeals pursuant to Rule 72 and 73 for the same reasons as given in Merivale. They need not be repeated here.

Question 3: Is Rule 38(7) a Special Notice provision?

26The Moving Party attributes meaning to the undefined term “Special Notice” that appears in a single place in the Rules, in the heading to Rule 40. As noted above, Rule 40 enables a party in a summary proceeding to seek a higher assessment than returned by MPAC.

27However, the Board in Merivale at para. 37 determined the term had been used with reference to its old rules of practice, that its use as a heading was unimportant in the Rules and that its insertion as a heading was merely for ease of reference. The Moving Party argues that “any suggestion that a separate Special Notice is not necessary and that a notice of intention to seek a higher assessment may be incorporated into the statement of response is untenable,” but the Board disagrees for the same reasons set out in Merivale.

28The Board’s answer to the Moving Party’s third question is therefore in the negative because the Rules contain no “Special Notice” provisions in the way the term is used in the motion.

Question 4: Can the Board reinstate withdrawn appeals without an action by a party?

29The Moving Party correctly notes that the appeals were withdrawn and closed by the Board and then reopened. It argues that the Board lacks authority to reinstate appeals without a request for review under Rules 120 to123.

30Rules 120 to 123 address situations where a party to a proceeding can request a review of a Board decision. Rule 122 in particular addresses reinstatement by request for review where “a party to a former proceeding may seek an order from the Board to reinstate an appeal…”

31That was not, however, what occurred here. The appeals were withdrawn and closed in error, and Board staff simply reversed the error when it came to their attention by reinstating, in effect reopening the files, that had been closed in error. There is no reason the Board should not be entitled to correct its own clerical errors to return the circumstances to those in place before the clerical error was made.

32Therefore, in these very limited circumstances, the Board finds that withdrawn appeals can be reinstated if they were closed because of its own clerical error.

Question 5: Does MPAC have the authority to alter the assessment roll during the tax year based solely on a change in opinion of the market value?

33Citing Toronto (City) v Municipal Property Assessment Corp, 2013 ONSC 6137 (“Toronto (City)”), MPAC argues that MPAC lacks the authority to alter the assessment roll during the tax year based solely on a change in opinion of the market value. This was the third question before the Board in Merivale which was addressed in paragraphs 42 to 48 of that decision.

34In essence, those reasons distinguished Toronto (City) as summarized in paragraph 47:

The Board concurs with MPAC’s submission in this case that “the whole purpose of an appeal is to allow the Board to determine the correct current value and change the assessment if required.” The court in Toronto (City) determined at paragraph 64 that “MPAC has no jurisdiction to amend the current value under s. 33(3) or 34(1)(b)(i) in the absence of a physical change to the property” and that “the same is true for the (Board)”. It did not hold that to be the case in an annual assessment and appeal, nor would it have been logical or consistent for it to have done so.

35The Board adopts those reasons here.

Question 6: Regardless of the Board’s findings in questions 1 through 5, does Rule 73 allow the Board to grant a request to withdraw the appeals in the circumstances presented in this motion?

36In asking that the Board grant its request to withdraw, the Moving Party argues that the principle of finality should take precedence over the correctness of assessments. The Board’s previous findings have addressed this question.

37The Board finds that the Moving Party has not established any grounds to support its request to withdraw the appeals.

Schedule of Events

38Finally, the Moving Party requests a revised Schedule of Events to account for the time it was going to take for this motion to be decided. That request is granted.

39When the motion was filed, each responding party had provided its Statement of Response and any additional supporting disclosure to the other parties. The next step in the Schedule of Events was for the Moving Party to serve its Statement of Reply and any additional disclosure in support of its reply to all other parties (weeks 47 to 50 in the Schedule of Events set out in Schedule “A” to the Rules). This was to have been done on or before September 30, 2019, a date which has passed.

40As a result, in view of the exceptional circumstances caused by the delay in resolving this motion and pursuant to Rule 82, the Board extends the timeline in the Schedule of Events to allow the Moving Party to do what should have been done by September 30, 2019. An amended Schedule of Events with any further necessary adjustments will follow the release of this decision.

41As a result, the motion to withdraw the appeals is denied and the request for a revised Schedule of Events is granted.

CONCLUSION

42Soul Restaurants’ motion to withdraw its 2017, 2018 and 2019 appeals is denied.

43The due date in the Schedule of Events for the Moving Party to serve its Statement of Reply and any additional disclosure in support of its reply to all other parties is extended to a date 30 days following the issuance date of this decision, and all other subsequent due dates in the Schedule of Events will be adjusted accordingly.