Tribunals Ontario / Tribunaux décisionnels Ontario

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

ISSUE DATE: March 18, 2021

FILE NO.: DM 169145

Assessed Person(s): Jan Eberhardt, Heimke Eberhardt, Thies Eberhardt and Eberhardt Partnership

Appellant(s): Pano Cap (Canada) Ltd.

Respondent(s): Municipal Property Assessment Corporation Region 21

Respondent(s): City of Kitchener

Property Location(s): 55 Webster Road

Municipality(ies): City of Kitchener

Roll Number(s): 3012-040-033-01150-0000

Appeal Number(s): 3275983, 3311089, 3365203 and 3409119

Taxation Year(s): 2017, 2018, 2019 and 2020

Hearing Event No.: 742268

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

Parties	Representative
Pano Cap (Canada) Ltd.	Drew Samuels
Municipal Property Assessment Corporation	Michael Radan
City of Kitchener	Greg Demacio

REQUEST FOR: Request for a Decision Based on a Settlement of Appeals

HEARD: March 11, 2021 in writing

ADJUDICATOR(S): Jean-Paul Pilon, Member

MOTION DECISION

OVERVIEW

1Pano Cap (Canada) Ltd. (the “Moving Party”) is the owner of a property at 55 Webster Street in Kitchener (the “Subject Property”). The Moving Party appealed the assessment of the Subject Property for the 2017 taxation year, and further appeals for the 2018, 2019 and 2020 taxation years were deemed pursuant to section 40(26) of the Assessment Act, R.S.O. 1990, c. A.31.

2Representatives for the Moving Party, the Municipal Property Assessment Corporation (“MPAC”) and the City of Kitchener (the “Municipality”) discussed the possibility of settling these appeals by email. As a result of those discussions, representatives for the Moving Party and MPAC believed that the appeals had been settled, but the Municipality’s representative did not. In this motion, the Moving Party essentially seeks to have the terms of that purported agreement confirmed by the Assessment Review Board (the “Board”).

3A determination that there was no agreement to settle the appeals would lead to further questions as to the next steps in these appeals and whether MPAC should be entitled to serve and file any expert report that was not served in accordance with the Schedule of Events assigned to these proceedings.

Result

4On the first question, the Board finds that there was no agreement to settle the appeals. On the second question, the Board finds that the Schedule of Events should be extended to allow MPAC and the Moving Party to file all of their documentation that should have been filed on or before December 14, 2020, except MPAC shall not be entitled to file any expert report.

ANALYSIS

Issue 1 – Was There an Agreement to Settle the Appeals?

Factual Background

5On October 19, 2020, the Appellant’s representative in this motion, Drew Samuels, made a “without prejudice” offer to settle the appeals. The proposal was to reduce MPAC’s current value assessments of the Subject Property from $4,093,000 for the 2017 to 2019 taxation years and $4,068,000 for the 2020 taxation year, to $3,752,000 for all taxation years. Discussions then continued by email regarding the components of the offer. On October 29, 2020, the Municipality’s representative who did not represent the Municipality in this motion, Amboka Wameyo, countered with an offer to settle the 2017 to 2019 appeals at $4,037,252 and the 2020 appeal at $4,068,000. On November 9, 2020, Mr. Samuels indicated in an email that “it seems we are even closer to an agreement” and provided additional information for MPAC and the Municipality to consider.

6On November 13, 2020, Mr. Samuels emailed the other parties indicating that he and Ms. Wameyo had a “brief, off the record” conversation relating to the appeals. He wrote that “in short, my understanding is that the offer (of $3,752,000 for all taxation years, which is the next number that had been discussed) would be considered reasonable by the (Municipality) subject to MPAC’s approval as well.” MPAC’s representative in this motion, Michael Radan, wrote that he too agreed to the offer and that minutes of settlement would be drafted and circulated.

7That same day, Ms. Wameyo wrote to Mr. Radan asking: “would it be possible to see the revised GRAD¹ before agreeing to the final number?” Ms. Wameyo further wrote that “in principle we agree to the parameters outlined but we are all working from our own spreadsheets and I am interested to see what the actual computation in MPAC’s system will generate.” Similar emails were resent on November 19, 2020 and on December 3, 2020 because the requested GRAD was not sent to the Municipality.

8On December 4, 2020, the GRAD was sent to the Municipality which had been revised to reflect the parties’ discussions. It indicated a value of $3,751,000 and not $3,752,000 and had been signed by a representative of MPAC. Mr. Samuels signed the minutes of settlement on behalf of the Moving Party/appellant. Ms. Wameyo’s response the same day indicated that she did not understand the minutes of settlement because they revised the 2012 cycle current value assessment from $3,986,000 to $3,649,585, and because they did not exactly reflect the number discussed, $3,752,000. Mr. Radan replied on December 7, 2020 that he would “look into” the 2012 issue and that the $1,000 difference was the result of rounding that they would have to “over ride to get it to the $3,752,000 (sic).” The response from Ms. Wameyo that same day was “thank you for the review and also for agreeing to adjust the final value conclusion.”

9In its notice of motion, the Moving Party wrote that “this change was not discretionary as there was a new tax classification introduced in the settlement which mandated changed (sic) to be reflected in the notional value.”

10On December 9, 2020, Ms. Wameyo wrote to Mr. Radan “wondering if there has been any further discussion on the concerns raised by the (Municipality) regarding the Minutes that were circulated?” These concerns were set out three bullet points referring to the “suggested settlement amount of $3,752,000”, “the change in the 2012 CVA total amount”, and a concern about the phase-in. It then went on to say that documents would be filed with the Board in accordance with the Schedule of Events if the appeals were not settled because that date was fast approaching. The Moving Party replied that its position was that the appeals had been settled, that the questions raised were “administrative” in nature, and that “if the values are read in, the starting point can be calculated afterwards.”

11On December 14, 2020, the Municipality filed its documents in accordance with the Schedule of Events indicating its position on current value for the taxation years in question as $3,999,392 and not $3,752,000.

Analysis

12The Moving Party in this motion argued that there was a binding agreement that should be read into the Board’s record to resolve the appeals. Its legal argument only addressed issues around privilege and that “without prejudice” offers like these ceased to be without prejudice upon acceptance.

13In its response to the motion supporting the Moving Party’s position, MPAC noted the only outstanding issues as of December 14, 2020 were the rounding error and classification, noting that the Municipality did not propose any alternative. It argued that where “one party operating in a manner that led the other parties to believe that there was a settlement, and then withdrawing from the agreement after the (Schedule of Events) deadline to file documentation is unusual or atypical and does not occur regularly.” For its part, the Municipality argued in its lengthy submission in the motion that there was no agreement to settle the appeals.

14With respect, the Board finds that the Moving Party’s argument relating to privilege misses the point, because the question to be answered is not at which point the “without prejudice” offer became a “with prejudice” offer binding the Municipality. It is rather a more fundamental question as to whether there was acceptance of the offer.

15The Moving Party’s position is concisely summarized in its inadequately cited quote from a case it identified as Walker v. Wisher (1889) 23 Q.B.D. 335 that “if the terms proposed in the letter are accepted a complete contract is established and the letter, although written without prejudice, operates to alter the old state of things to establish.” This is, in fact, true as was confirmed more recently and locally in Shepherd v. Inglis, 2002 CanLII 36459 (ON SC) at para. 8, that “if the Court determines that a contract exists, then the correspondence loses its privileged nature permanently.” That decision continued that “if the Court determines that no contract was made, then for the purpose of any further litigation between the parties, the “without prejudice” correspondence returns to its privileged nature.”

16However, this is not a situation where the Municipality was attempting to withdraw from its acceptance of an agreement because the offer had been made on a “without prejudice” basis. It is instead a situation where the Municipality’s argument was that there was no agreement because there was no acceptance of the Moving Party’s offer to settle.

17There would have had to have been an offer to settle the appeals by MPAC and the Moving Party followed with acceptance by the Municipality for this purported agreement to have been binding on the parties in these circumstances. As to the requirement of an offer, it was not in dispute in the motion that there was an offer to settle the appeals at $3,752,000. The real question to be determined in this motion is whether there was acceptance of that offer by the Municipality.

18Neither the Moving Party nor MPAC explained in their motion material at which point or points in the chronology they thought that the Municipality had accepted their offer. Having left that question open for the Board to determine, it finds two critical junctures in this factual narrative where the Municipality’s acceptance might have been perceived. The first was in Ms. Wameyo’s email correspondence on November 13, 2020, and the second, in Ms. Wameyo’s email correspondence on December 7, 2020.

19The first appearance of an offer from the Appellant at $3,752,000 in the evidence submitted in this motion was on November 13, 2020. The answer from Ms. Wameyo that day was that she wanted to see the GRAD and that there was an agreement “in principle” to the “parameters outlined”. This was, in fact, a reservation, that she needed to see “the actual computation”, suggesting that there was a condition precedent to complete agreement. The Board finds that this comment meant that it was an acceptance of generalities, not of specific terms. In Shepherd v. Inglis, 2002 CanLII 36459 (ON SC) at para. 22, several cases were cited “establishing the principle that for a contract to be concluded, there must be an absolute and unequivocal acceptance of the proposed terms.” In this instance, the Board is not satisfied that the email communication met that threshold.

20The second point at which acceptance might have been construed by the Municipality was in its email on December 7, 2020 where, in a single sentence, Ms. Wameyo wrote “thank you for the review and also for agreeing to adjust the final conclusion.” Alone, this might have amounted to acceptance of the final value, but the context is important because former sentence referring to a “review” was in reply to Mr. Radan’s comment that “I will look into the 2012 CVA and get back to you.”

21The Board finds that Ms. Wameyo’s questions on the references to the 2012 taxation cycle were legitimate ones, not only because of the concern as to the effect of phase-ins, even if those might have been outside of the Board’s jurisdiction, but also because 2012 appeals were not before the Board. Moreover, it may have been the case that there was no discretion on these points as was indicated in the Moving Party’s motion, but nowhere in the evidence before the Board was that adequately explained to the Municipality.

22MPAC’s further point in its submission was that the Municipality was “operating in a manner that led the other parties to believe that there was a settlement, and then withdrawing from the agreement” after the filing date in the Schedule of Events.

23It is correct, to quote Waddams in The Law of Contracts, 2d ed. (Toronto: Canada Law Book Inc., 1984) at 70 and 71, that “if one party is aware of the other’s belief in the existence of a contract, and does nothing to deny it, but acts himself as though there were a contract, he may be estopped from later denying that a contract exists.” However, that is not what occurred here because the Municipality did not act as if there was a contract. This was instead a period of time in which there was silence, where the parties were not communicating, that led up to the filing date in the Schedule of Events. Ms. Wameyo’s questions remained unanswered during this time and there was no evidence that the Municipality operated as if there was an agreement that had been concluded.

24The Board does not agree that the Municipality led the other parties to believe that there was a contract, that it withdrew from any agreement, or that it should be estopped from denying that there was an agreement. There was no acceptance of any offer. The Board therefore finds that the appeals are not settled because there was no agreement to resolve them.

Finding on Issue 1

25There was no agreement to settle the appeals.

Issue 2 – What are the Next Steps in These Proceedings?

26The Schedule of Events that was extended for expert reports set out dates for the circulation of documentation by the parties and the filing of that documentation by December 14, 2020. Apart from an extension of time that was agreed to, the parties circulated their documentation as required, except MPAC did not circulate any expert report. The only party to have complied with the filing requirement above was the Municipality because the Moving Party and MPAC took the position that the appeals had settled.

27Rule 82 of the Board’s Rules of Practice and Procedure (the “Rules”) provides that “after…the start of a proceeding the Board will not alter any timeline in the schedule of events other than in exceptional circumstances.”

28MPAC essentially argued that these events were exceptional circumstances because the other parties genuinely believed the appeals had been settled in not filing their documentation on time. The Municipality argued that the Moving Party, which did not request an extension of time for filing, should now be required to file an additional request to extend time to file its documentation because that request was not made in its motion submission.

29The Board disagrees with the Municipality because requiring the submission of a further request would unnecessarily extend the resolution of these appeals that has already been delayed and would waste time. In any event, that request was made by MPAC in its submission.

30The Board finds that there were exceptional circumstances in these facts that would justify extending time in the Schedule of Events. This motion was not frivolous, vexatious or in bad faith as alleged by the Municipality in its submission because it was arguable that there was an agreement to settle the appeals. In fact, while the Moving Party’s motion was unsuccessful, the Board is of the view that it could have been avoided entirely had the Municipality been clearer in its correspondence with the other parties as to its position in the appeals.

31Moreover, the Board does not agree that the Municipality would suffer prejudice if time was extended pursuant to Rule 82. The logical solution in these circumstances is rewind the Schedule of Events to allow the parties to file their documentation so that a settlement conference can be held, as if this dispute had not arisen. Otherwise, the ensuing prejudice would be the other way around, because if the Moving Party and MPAC were not granted additional time for filing, it would essentially prevent them from further participation in the appeals. They would be quite seriously prejudiced if time was not extended.

32As a result, the December 14, 2020 filing date set out in the Schedule of Events shall be extended to a date 14 days from the date of this decision, at which point the Board will schedule a Settlement Conference. All documents that should have been filed by that date should instead be filed by that date.

33The only exception is that MPAC shall not be entitled to file any expert report that was not served on the other parties on or before October 5, 2020 as was required by the Schedule of Events. This is because the circumstances that led to this motion occurred prior to that date, and there was no explanation for MPAC’s failure to serve any expert reports upon which it intended to rely by that date. On that single issue, there were no extraordinary circumstances to justify extending time pursuant to Rule 82.

Finding on Issue 2

34The Board will alter the timeline set out in the Schedule of Events because there were exceptional circumstances.

CONCLUSION

35The Board finds that there was no agreement to settle the appeals and that the timeline in the Schedule of Events should be extended.

ORDER

36The Board orders that the parties shall have 14 days from the date of this decision to file all of their documentation that should have been filed on or before December 14, 2020 with the exception of any expert report from MPAC.

Footnotes

1. 1A “GRAD” was determined in Municipal Property Assessment Corporation (“MPAC”) Region No. 5 v. Kingston (City), 2019 CanLII 101169 (ON ARB) at para. 4 to mean “Guidelines for Release of Assessment Data.” This document would essentially have set out in detail how the assessments were arrived at.