Tribunals Ontario / Tribunaux décisionnels Ontario

Assessment Review Board / Commission de révision de l’évaluation foncière

ISSUE DATE: February 09, 2021 FILE NO.: WR 167992

Assessed Person(s): 1191693 Ontario Inc. Appellant(s): 1191693 Ontario Inc. Respondent(s): City of Brampton Property Location(s): Unit 9, 7955 Torbram Road Municipality(ies): City of Brampton Roll Number(s): 2110-150-118-01059-0000 Appeal Number(s): 3218762 Taxation Year(s): 2014 Hearing Event No.: 739364

Legislative Authority: Section 364(14) of the Municipal Act, 2001, S.O. 2001, c. 25

APPEARANCES:

Parties 1191693 Ontario Inc. City of Brampton

Representative Ajay Chadha Kumar Sapkota

HEARD: January 12, 2021 by video conference

ADJUDICATOR(S): Joanne Laws, Member

DECISION

OVERVIEW

11191693 Ontario Inc. (the “Appellant”) applied to the City of Brampton (the “City”) for a 2014 vacant unit rebate, pursuant to s. 364 of the Municipal Act, 2001, S.O. 2001, c. 25 (the “Act”) for Unit 9, 7955 Torbram Road (“the Property”). The Property is an industrial condominium assessed in the commercial tax class and measures 4,529 square feet. The appeal relates to the entire Property.

2The City denied the application and the Appellant appealed the decision to the Assessment Review Board (the “Board”) pursuant to s. 364(14) of the Act. The Appellant’s position is that the Property was vacant for the entirety of 2014 and that it complied with the City’s evidentiary requirements. The City’s position is that it was justified in denying a rebate because the evidentiary requirements were not met.

3Ajay Chadha represented and was the witness for the Appellant. Kumar Sapkota represented and was the witness for the City.

4The legislative objective of s. 364 of the Act is to provide tax relief to commercial and industrial property owners if they suffer vacancy losses exceeding 90 consecutive days as stipulated by Ontario Regulation 325/01 (“O. Reg. 325/01”). In 2014, the year subject to this appeal, Municipalities were required to have a vacancy rebate program. However, establishing the requirements that must be met for an applicant to qualify for a vacant unit rebate was discretionary. There is no dispute that the Property is eligible for a Vacant Unit Rebate pursuant to s. 364(1) of the Act.

Issues for the Hearing

5The issues to be determined are:

a. Whether the Appellant met the requirements for a vacant unit rebate in accordance with s. 364 of the Act¹, the O. Reg. 325/01² and the City’s evidentiary requirements. Note that no amendments were made to s. 364 of the Act between April 8, 2013 and December 2, 2015 and no amendments were made to O. Reg. 325/01 between May 17, 2005 and July 23, 2015. I will be relying on these versions for my determination of this 2014 appeal.

b. If the requirements were met, the amount of the vacant unit rebate owing from the City to the Appellant.

Result

6For the reasons set out above, I find that the Appellant is entitled to a vacant unit rebate for the entire Property for the 2014 calendar year.

7The City shall rebate the Appellant the sum of $4,279.90 for the 2014 calendar year. This sum shall be paid within 120 days from the date this Decision is released.

Chronology of Events

8The City acknowledged receipt of the Appellant’s 2014 Vacant Unit Rebate application, advising the Appellant that the application was incomplete and requested the following documents by April 24, 2015:

a) New Lease and b) Real Estate Listing Agreement

9In August 2015, City staff member, Jasna (Yasmin) Vukojevic, requested an inspection of the Property. An agreed upon date and time was set but she did not attend. Mr. Chadha testified he left messages for Ms. Vukojevic explaining he would be out of the country and requested a rescheduled site visit when he returned but that a subsequent date was not set. The City’s evidence indicates that a staff member viewed the exterior of the Property in August 2015.

10On September 23, 2015, the City issued a written rejection for a vacant unit rebate. A copy of that document was submitted into evidence. It simply states: “application failed site inspection”. Mr. Chadha testified he was not made aware of the inspection and contacted Ms. Vukojevic who advised him the application was denied because she was unable to conduct a site visit.

11On October 27, 2015 a site visit occurred during which Ms. Vukojevic took photos of the unit. Mr. Chadha testified he called Ms. Vukojevic and left several messages but did not receive a reply. On November 13, 2015, he visited the City’s office to inquire about the state of the application. On November 18, 2015 he received a voice message from another City staff member, Yvonne Kwiecien, who stated that the application was rejected and that he could appeal the City’s decision to this Board.

ANALYSIS

Issue 1 - Is the Appellant entitled to relief pursuant to [s. 364](https://www.canlii.org/en/on/laws/stat/so-2001-c-25/latest/so-2001-c-25.html#sec364_smooth) of the [Act](https://www.canlii.org/en/on/laws/stat/so-2001-c-25/latest/so-2001-c-25.html)?

12For the 2014 taxation year, the Act provided:

Vacant unit rebate

364. (1) Every local municipality shall have a program to provide tax rebates to owners of property that has vacant portions if that property is in any of the commercial classes or industrial classes…

Evidentiary requirements

364. (5) The program may include evidential requirements that must be satisfied for the owner to be entitled to a rebate under this section.

13In response to the appeal of its decision, the City provided a list of 12 evidentiary “requirements” that may or must be satisfied for an applicant to qualify for a rebate.

14At the hearing, Mr. Sapkota explained that the application failed because the Appellant failed to comply with the City’s evidentiary requirements, namely “Documentation that the property was offered for lease within the vacancy period, such as MLS listing or rental advertisement i.e. a copy of a newspaper/internet advertisement. All advertisements must contain the date of the ad”. Additionally, the City’s application requirements include examples of evidence to illustrate the beginning and ending of the vacancy period. He could not explain what was found during the City’s inspection of the Property that led to the denial of a Vacant Unit Rebate.

15Mr. Sapkota argued that the Appellant failed to provide evidence showing the vacancy commencement date by means of a lease termination letter, court order or eviction notice.

16Mr. Chadha provided the following documentary evidence:

a. A copy of the 5-year lease commencing January 1, 2007 and terminating December 31, 2011.

b. Bankruptcy documents showing that the 2007 tenant filed for bankruptcy on November 20, 2007 and that there were a number of banks listed as primary creditors.

c. A real estate sale listing agreement for the period April 1 - 9, 2014.

d. Photographs posted on the exterior of the Property advertising it is available for sale or lease.

17Mr. Chadha testified that the Property was vacant from 2007, when the tenant defaulted on rent payments and subsequently filed for bankruptcy, until August 1, 2016 when the Property was re-rented.

18The City’s evidentiary requirements, as noted above in paragraph 14, showing the commencement of the vacancy period cannot be met if they do not exist. Based on the 2007 lease and subsequent bankruptcy documents I am satisfied that the vacancy period began in 2007, prior to the period subject to this appeal.

19Mr. Chadha maintains that it chose to market the Property itself rather than incur the costs of listing it with realtors or using other rental advertisements. He argues that the Appellant ought not to be restricted to the form of advertising. I find that the Appellant’s choice of advertising the Property does not conflict with the City’s evidentiary requirements. The City’s wording that a property is available for lease (quoted above) does not limit the methods of advertisements but provides examples of advertisement methods. I find that advertising the vacancy by signage posted on the exterior of the Property does not conflict with the City’s evidentiary requirements.

20Mr. Sapkota argued that the photographs of the advertising signs are not dated and, therefore, do not demonstrate that the Property was vacant in 2014. Item 11 of the City’s list of evidentiary requirements submitted at the hearing provides “The owner may be required to submit a notarized statement or affidavit confirming the vacant area and the timeframe”. I received no evidence that such documents were requested. I accept Mr. Chadha’s viva voce evidence that the photographs reflect the signs reflect the advertising used during 2014.

21Mr. Sapkota argued that properties listed for sale do not qualify for vacant unit rebates, only those that are available to lease. I do not accept Mr. Sapkota’s argument that the brief sale listing agreement proscribes a vacant unit rebate. Section 364 of the Act does not specify that a sale or sale listing disqualifies a property from a vacant unit rebate. The City’s submitted list of evidentiary requirements does not require that a vacant unit must only be available for lease. Indeed, such a requirement could increase a vacancy period. It is reasonable that the property owner actively pursues both leasing and selling in order to mitigate the vacancy period.

22Mr. Sapkota argued that the Appellant failed to provide evidence of when the vacancy ended by providing a new lease or rent roll. The Appellant’s evidence is that the vacancy ended after the date the application was made and after the date the City made its determination. The Appellant cannot provide evidence that did not exist at the time the application was made or being processed.

23When questioned, Mr. Sapkota testified he has no first-hand knowledge of the events related to the application nor did the City call any witnesses.

Findings on Issue 1

24For the reasons set out above, I find that the Appellant is entitled to a Vacant Unit Rebate for the period January 1, 2014 to December 31, 2014.

Issue 2 - The Amount of the Vacant Unit Rebate

25The Appellant provided the Property’s 2014 final tax bill for the 2014 tax year in the amount of $14,266.32 which was reviewed at the hearing. The City raised no issues with the tax bill.

26The property was identified as an industrial condominium assessed in the commercial tax class. The rebate amount for a property assessed in the commercial tax class is 30% (s. 364(2)). The method of calculating the rebate is found at s. 2(2) of O. Reg. 325/01.

Findings on Issue 2

27Accordingly, the amount of the vacant unit rebate is $4,279.90 ($14,266.32 x 30%).

CONCLUSION

28For the reasons set out above, I find that the Appellant is entitled to a Vacant Unit Rebate for the Property for the 2014 calendar year.

ORDER

29The City shall rebate the Appellant the sum of $4,279.90 for the 2014 calendar year. This sum shall be paid within 120 days from the date this Decision is released.

Footnotes

1. 1https://canlii.ca/t/520fb
2. 2https://canlii.ca/t/1mll