Assessment Review Board

Commission de révision de l’évaluation foncière

ISSUE DATE: November 04, 2020 FILE NO.: WR 165742

Assessed Person(s): Ross Edward Milne, Marion Shelagh Milne Appellant(s): Ross Edward Milne, Marion Shelagh Milne Respondent(s): Municipal Property Assessment Corporation Region 31 Respondent(s): Town of Blind River

Property Location(s): 65 Youngfox Road Municipality(ies): Town of Blind River Roll Number(s): 5738-000-006-18700-0000 Appeal Number(s): 3333057, 3381732 and 3411152 Taxation Year(s): 2018, 2019 and 2020 Hearing Event No.: 729673, 730574 and 731865

Legislative Authority: Section 40 of the Assessment Act, R.S.O. 1990, c. A.31,

APPEARANCES:

Parties	Representative
Ross Edward Milne, Marion Shelagh Milne	Ross Edward Milne
Municipal Property Assessment Corporation	Richard Thomas
Town of Blind River	Katie Scott

HEARD: March 5, May 4 and August 12, 2020 by telephone conference call

ADJUDICATOR(S): Jennifer Griffith, Member

DECISION

OVERVIEW

1Ross Edward Milne and Marion Shelagh Milne (the “Appellants”) are the owners of 65 Youngfox Road (the “Subject Property”). They filed an appeal for the 2018 taxation year with the Assessment Review Board (the “Board”), pursuant to s. 40 of the Assessment Act, R.S.O. 1990, c. A.31 (the “Act”). Pursuant to s. 40(26) of the Act, the Appellants are deemed to have brought the same appeal in respect of the 2019 and 2020 taxation years. The Subject Property is located in the Town of Blind River.

2It is the Appellants’ position that the Municipal Property Assessment Corporation’s (“MPAC”) current value assessment of $9,200 for the 2018 and $8,500 for the 2019 and 2020 taxation years are too high and that the correct current value should be $442.00. MPAC testifies that an offer to reduce the returned assessment of the Subject Property to $3,000 was made to settle the appeals and it was rejected by the Appellant. MPAC submits that the $3,000 represents the difference between the assessment under appeal and the assessed value for the taxation 2021 with the consolidation of the two parcels of land below (Issue #1) which will become the Subject Property. At today’s hearing MPAC submits that the $3,000 is still an alternative correct current value, even though, MPAC sales analysis supports a correct current value of $8,500.

3The Town observed the hearing and took no position of the correct current value.

4Pursuant to s. 44(3)(b) of the Act, MPAC takes the position that an equitable reduction of the current value is not required. The Appellants assert that an equitable reduction is required and believes that the equitable value should be $442.00. The Town took no position on equity.

Issues for the Hearing

5At issue in this proceeding is:

1. Is the Subject Property part of a larger parcel purchased in 2017, with a single Roll number and a single Municipal address?
2. What is the determination of the current value of the Subject Property for the 2018, 2019 and 2020 taxation years based on a direct comparison approach?
3. Should there be an equitable reduction of the current value pursuant to s. 33.(3)(b) of the Act, and, if so, what should the amount of this reduction be?

Result

6The Board finds the correct current value of the Subject Property is $3,000 as of the valuation date of January 1, 2016, which is applicable to the 2018, 2019 and 2020 taxation years for the reasons set out below.

7Pursuant to s. 44(3)(b) of the Act a further reduction is not required.

8The assessment is therefore reduced from $9,200 to $3,000 for the 2018 taxation year; and from $8,500 to $3,000 for the 2019 and 2020 taxation years.

ANALYSIS

Description of Subject Property

9The Subject Property is vacant residential land not on water (Property Code 100), located at 65 Youngfox Road in the Town of Blind River. The Subject Property’s lot size was 0.30 acres in 2018 and following a review in that same year, the lot size was amended to 0.22 acres. The lot has an irregular shape and is primarily level.

Issue 1 – Is the Subject Property part of a larger parcel purchased in 2017, with a single roll number and a single Municipal address?

10The Appellants testify that they purchased two parcels of land in August 2017 (roll number 5738-000-006-18300 and roll number 5738-000-006-18700 subject to this appeal) which were supposed to be transferred and registered under one Roll number and one municipal mailing address which was supposed to be the Subject Property. However, in 2018 they discovered that the two parcels of land were assigned individual roll numbers, separate municipal mailing addresses and assessed separately.

11In support of this argument, the Appellants present a copy of the Registration of Transfer which was sent to them on November 8, 2018 by their lawyer, Larry D. Peterson B. A. LLB, to show that the Transfer was registered on title via the electronic registration system on August 11, 2017. The document shows two parcels of land (roll number 5738-000-006-18300 and roll number 5738-000-006-18700 the Subject Property) were purchased and that the Municipal address is 68 Centre Street, Blind River, ON P0R 1B0. The Appellants argue that despite the fact that they provided MPAC with a copy of the Registration of Transfer, every effort to resolve the problem was unsuccessful. Therefore, they filed an appeal for the 2018 taxation year with the Board for the Subject Property as part of their appeal, and the Appellants seek to have both parcels assessed as one.

12MPAC testifies that Roll numbers are assigned to properties based on information obtained from the Land Registry and according to the information received from the Land Registry properties are assigned Roll numbers, with the municipal address on title and are assessed accordingly. MPAC testifies that several inquiries were made with the Land Registry and it was advised that the Subject Property was registered as roll number 5738-000-006-18700 (a single parcel) and the municipal address as 65 Youngfox Road. Therefore, MPAC made no changes to the information obtained from the Land Registry.

13Although the Town was only observing the hearing, the Representative for the Town understanding the Appellants dilemma, offered to assist by addressing the matter with the Town’s legal department. The Representative reminded the parties that due to the COVID-19 pandemic, and changes to the working environment some extra time would be required.

14Based on the submissions of the parties, the Board granted an adjournment. A telephone conference call (“TCC”) Hearing 730574 on May 4 was scheduled to get a status update of the appeal. At the hearing, the Town advised the Board that the lawyer for the Town agrees with the Appellants and will be issuing a letter indicating what needed to be done and by whom; and will be copying the letter to all parties including the Board. The hearing was adjourned and scheduled on consent of the parties for August 12, 2020, TCC Hearing 731865.

15As promised, a copy of the letter from the Town’s lawyer, Nuala M. Kenny, Wishart Law Firm LLP, was filed with the Board and dated May 14, 2020 indicating:

Both 68 Centre Street and 65 Youngfox Road enjoy separate municipal addresses and roll numbers. Despite the separate municipal addresses, and roll numbers, the lands are in fact one parcel…To correct the roll numbers, it will be necessary to make the request to MPAC….

16At today’s hearing and in response to Counsel Kenny’s letter, MPAC states that the consolidation of 68 Centre Street and 65 Youngfox Road will be effective as of the 2021 taxation year. With the consolidation of the two parcels of land there will be only one Roll number and other relevant changes (municipal address, size etc.) will be noted on the Assessment Notice for the next assessment cycle.

Finding on Issue 1

17Regarding the issue of whether the Subject Property is part of a larger parcel purchased in 2017 that should have a single Roll number and a single Municipal address, the Board has no jurisdiction over Land Transfer Registration; consolidation of properties; and the assignment of Roll numbers. However, the Board accepts the testimony of MPAC that the Subject Property will be consolidated with 68 Centre Street based on the letter from Nuala M. Kenny, Wishart Law Firm LLP, the Town’s lawyer, effective 2021 taxation year. Both MPAC and the Appellants agree that the consolidated lot size would be 17,221 square feet.

Issue 2 - What is the correct current value of the Subject Property for the 2018, 2019 and 2020 taxation years?

18In determining the correct current value, the Board references s. 19(1) of the Act which states that the assessment of land shall be based on its current value, which is defined in s. 1(1) of the Act as the “… amount of money the fee simple, if unencumbered, would realize if sold at arm’s length by a willing seller to a willing buyer”. The valuation date for the 2017 to 2020 taxation years is January 1, 2016.

19In reviewing the following evidence presented in support of current value, the Board finds that MPAC presents the best evidence with three comparable properties which sold in 2015 and 2016. These three comparable properties are located at 50 Hamilton Avenue; at 165 Colonization Road; and 38 Nadon Avenue, with an average lot size of 0.18 acres and median time-adjusted sale price of $7,893.

20The Board finds that the median time-adjusted sale price of $7,893 represents the best evidence of an arm’s length transaction between a willing buyer and a willing seller pursuant to s. 19(1). However, MPAC submits that although the Appellants rejected an offer of $3,000 to settle, this value is still offered at today’s hearing as an alternative correct current value, even though, MPAC sales analysis supports a correct current value of $8,500. The Board having considered the above consolidation (Issue # 1) accepts the parties’ positions that the value should not be more than $3,000. Therefore, the Board finds the correct current value is $3,000.

MPAC’s Suggested Comparable Properties

21MPAC presented a Valuation Report, dated October 1, 2019, which was prepared by Richard Thomas, a representative of MPAC and testifies to the information contained in the report. MPAC testifies that the Subject Property was inspected on April 26, 2018 and the site area was corrected and changed from 0.30 acres to 0.22 acres.

22In support of current value, MPAC testifies that it relies on the market evidence of the following five sales of vacant residential lots, not on water, located within 1.9181 kilometres of the Subject Property, which occurred over the period 2013 and 2016. MPAC testifies that it selected sold properties that are inferior, superior and similar to the Subject Property to allow it to establish a probable range of current value for the Subject Property by bracketing the Subject Property between sold properties that are inferior and superior to it. MPAC provided both the actual and time-adjusted sale prices and relies on the Direct Comparison Approach. The Direct Comparison Approach estimates the current value of the Subject Property by adjusting the sale price of other sold properties for differences in property characteristics to the Subject Property. The following is the analysis of the five suggested comparable properties:

SALES ANALYSIS

5 SUGGESTED COMPARABLE PROPERTIES	LOT SIZE (acres)	SALE DATES	SALE PRICE	TIME ADJUSTED SALE PRICE (“TAS”)	TAS PRICE PER (acre)
50 Hamilton Avenue	0.18	2015	$4,000	$4,018	$22,322
23 Schurm Avenue	0.23	2014	$4,220	$4,294	$18,669
5 Mountain Glenn Road	0.21	2013	$8,000	$8,282	$39,438
165 Colonization Road	0.16	2016	$8,000	$7,893	$49,331
38 Nadon Avenue	0.2	2016	$9,500	$9,373	$46,865
Median	0.20	2015	$8,000	$7,893	$39,438
Subject Property	0.22

Note: Subject Property is Assessed at $9,200 ($41,818 per acre)

23Based on the above analysis, MPAC estimates the current value to be $8,500 based on the most comparable properties. Although MPAC has stated that the Direct Comparison Approach estimates the current value of the Subject Property by adjusting the sale price of other sold properties for differences in property characteristics between the Subject Property and other sold properties, MPAC provided no detailed explanation of adjustments made to arrive at this value.

24In support of current value, the Appellants propose a current value of $442.00 which the Appellants claim is based on the assessments of neighbouring properties close to the Subject Property. However, the Appellants provided no evidence of sales values or any other evidence of current value of those neighbouring properties. Accordingly, there is insufficient evidence to make such a finding.

Findings on Issue 2

25In reviewing the above evidence presented in support of current value, the Board finds that MPAC presents the best evidence with three vacant residential lots not on water, located approximately 0.82 kilometres from the Subject Property and sold in 2015 and 2016. These three comparable properties are located at 50 Hamilton Avenue sold at a time-adjusted sale price of $4,018; at 165 Colonization Road, sold at a time-adjusted sale price of $7,893; and 38 Nadon Avenue, sold at a time-adjusted sale price of $9,373, with an average lot size of 0.18 acres and median time-adjusted sale price of $7,893. Because 50 Hamilton Avenue and 165 Colonization Road are slightly inferior in lot size; and 38 Nadon Avenue are located in a slightly inferior location and abuts a railway, the Board determines the median time-adjusted sale price by bracketing the time-adjusted sale prices of these three comparable properties and finds that the Subject Property would likely sell at the median sale price of $7,893.

26The Board finds that the Appellants present no sales in support of current value to assist the Board in its determination of the correct current value.

27The Board did not rely on MPAC’s sales which occurred in 2013 at 5 Mountain Glen Road; and in 2014 at 23 Schurm Avenue, because these two sales were too removed from the valuation date of January 1, 2016 to provide any meaningful test of current value.

28Based on the evidence, the Board finds MPAC presents the best evidence with the above three sales with a median sale price of $7,893. which is the best evidence of arm’s length and market-tested transactions. Although the Board has found the evidence supports a finding that the correct current value of the Subject Property is $7,893 for the 2018, 2019 and 2020 taxation years, MPAC’s position is that the value should be $3,000. While the Appellants have asserted that the correct current value is lower and should be $442.000, he certainly agrees that it should be no higher than $3,000. The Board having considered the above consolidation issues above (Issue # 1) accepts the parties’ positions that the value should not be more than $3,000. Therefore, the Board accepts the proposed value of $3,000 finds the correct current value is $3,000.

Issue 3 - Whether there should be an equitable reduction of the current value pursuant to [s. 44(3)(b)](https://www.canlii.org/en/on/laws/stat/rso-1990-c-a31/latest/rso-1990-c-a31.html#sec44subsec3_smooth) of the [Act](https://www.canlii.org/en/on/laws/stat/rso-1990-c-a31/latest/rso-1990-c-a31.html), and, if so, what the amount of this reduction should be.

29Section 44(3)(b) of the Act provides that “the Board shall… have reference to the value at which similar lands in the vicinity are assessed and adjust the assessment of the land to make it equitable with that of similar lands in the vicinity if such an adjustment would result in a reduction of the assessment of the land.” In essence, the Board looks at similar lands in the vicinity to determine whether their assessed values are lower than their current values. If so, then it would be equitable to lower the assessed value of the subject property by a proportionate amount.

30MPAC presents an Equity Analysis Report in which the assessments of 30 similar comparable properties (similar in general nature, character or function as the Subject Property) are compared to their respective sale prices to determine the Assessment to Sales Ratio (“ASR”). The ASR is computed by dividing the assessed values of the property sold by its sale price.

31MPAC states that these 30 comparable properties are Property Codes 100 – Vacant Residential Land not on water; and Property Code 301- single family detached not on water are similar property type (Residential) , sold over the period 2012 to 2016; and located within 0.5 kilometres of the Subject Property. MPAC states that due to very limited sales in 2016, the search for a reasonable sample size of sales was expanded to include older sales which were time-adjusted to the valuation date of January 1, 2016.

32MPAC states that the analysis of the sale of these 30 comparable properties shows a Level of Appraisal (“LOA”) of 0.956. The LOA measures central tendency and is the mid-point of the ASR ratios, and that the median ASR is the preferred measure to determine the LOA, because it is not affected by very low or high ratios; and a Coefficient of Dispersion (“CoD”) of 16.5. The CoD measures appraisal uniformity by determining the average percentage deviation from the median ASR. Based on this finding, MPAC’s opinion is that an equity reduction is not required, and the equitable value is $8,500.

33In support of Equity, the Appellants present no evidence, except referencing four graphs which the Appellants had created and filed with the Board on August 11, 2020, one day before today’s hearing. The graphs are titled (My Estimate of Consolidation vs Richard’s; Estimate 68 Centre St (value as if vacant); Overlay of neighbourhood Values; and Nadon Large Properties), plotted with square footages, name of properties without street numbers, and value per sq. ft. without any calculation to show how he arrived at the proposed equity value of $442.00.

34MPAC objects to references made to the four graphs by the Appellants, which were only sent August 11, 2020, one day before today’s hearing date and did not allow any time for MPAC to review and respond.

35The Board having considered MPAC’s objections to the late disclosure of the four graphs by the Appellants, rejects the admittance of the four graphs into evidence because it was emailed one day before the hearing without any explanation, which does not allow enough time for MPAC to review and respond to the documents. This decision is supported by Rule 48 which states:

No New Documents

A document, including an expert report, will only be admitted into evidence at a hearing event if it has been disclosed, and filed with the Board, in accordance with these Rules, unless the Board determines that there are exceptional circumstances.

Findings on Issue 3

36Based on all of the above evidence, the Board finds that MPAC presents the best evidence in support of equity, with the analysis of 30 sales of similar type properties (similar in nature, character or function) as the Subject Property, and located within 0.5 kilometres of the Subject Property. The analysis shows that these 30 sales of similar properties have a LOA of 0.956 which falls within MPAC standards of 0.95 – 1.05 and within the International Association of Assessing Officers (“IAAO”) with LOA of 0.90 – 1.10 which the Board accepts.

37The Board finds that the Appellants present no evidence in support of equity.

38Therefore, the Board finds that no adjustment is required.

CONCLUSION

39The Board finds the correct current value of the Subject Property is $3,000 for the 2018, 2019 and 2020 taxation years. Pursuant to s. 44(3)(b) of the Act a further reduction for equity is not required. The Board finds the equitable value is $3,000.

40The assessment is therefore reduced from $9,200 to $3,000 for the 2018 taxation; and from $8,500 to $3,000 for the 2019 and 2020 taxation years.