Tribunals Ontario

Assessment Review Board

Issue Date: February 28, 2022 File No.: WR 176094 Assessed Person(s): R. Mary J. Botterell Appellant(s): Mary Botterell Respondent(s): Municipal Property Assessment Corporation Region 09, City of Toronto Property Location(s): 106 St. Leonard’s Avenue Municipality(ies): City of Toronto Roll Number(s): 1904-104-570-04000-0000 Appeal Number(s): 3436479 and 3440817 Taxation Year(s): 2020 and 2021 Hearing Event No.: 756314 Legislative Authority: Section 40 of the Assessment Act, R.S.O. 1990, c. A.31

APPEARANCES:

Parties	Representative
Mary Botterell	Surin Toor
Municipal Property Assessment Corporation	Jessie Yu
City of Toronto	No one appeared

Heard: January 24, 2022 by telephone conference call

Adjudicator(s): Subuola Awoleri, Member

DECISION

OVERVIEW

1Mary Botterell, (the “Appellant”), owner of 106 St. Leonard’s Avenue (the “Subject Property”), appealed the 2020 assessment of the Subject Property to the Assessment Review Board (the “Board”) under s. 40 of the Assessment Act, R.S.O. 1990, c. A.31 (the “Act”) on the ground that the assessment is too high. The Appellant is deemed to have brought the same appeal in respect of the 2021 taxation year, pursuant to s. 40(26) of the Act.

2The Appellant argued that the Municipal Property Assessment Corporation (“MPAC”) has not met its burden of proving the correctness of the current value of the Subject Property, therefore, the Board should confirm the returned assessment of the Subject Property with a further downward adjustment to $1,695,573. In the alternative, the Appellant argued that the correct current value of the Subject Property is $1,836,648, with a further downward adjustment to $1,636,453 to make the current value equitable with the assessment of similar properties in the vicinity.

3The Subject Property was assessed by MPAC at $1,903,000. MPAC’s opinion of value based on market sales is $2,182,554. MPAC argued that a further downward adjustment to $2,029,775 is required to make the current value equitable with the assessment of similar properties in the vicinity. However, MPAC submitted that it is not seeking an increase in the assessment of the Subject Property and requested that the Board confirms the current value as returned at $1,903,000.

4At the completion of the hearing, the Board reserved its decision.

Issues for the Hearing

5The issues to be determined are:

1. What is the correct current value of the Subject Property for the 2020 and 2021 taxation years?
2. Whether there should be an equitable reduction of the current value pursuant to s. 44(3)(b) of the Act, and, if so, what the amount of this reduction should be?

Result

6The Board determines the correct current value of the Subject Property for the 2020 and 2021 taxation years to be $2,205,000 (rounded).

7The Board finds that a downward adjustment to the current value to $1,978,000 (rounded) is necessary to ensure that the assessment of the Subject Property is equitable with the assessments of similar lands in the vicinity.

8The evidence indicates a current value of the Subject Property at $1,978,000, higher than the assessment returned at $1,903,000. MPAC’s position is that the assessed value of $1,903,000 be confirmed. The Board finds that the current value of the Subject Property is $1,903,000 for the 2020 and 2021 taxation years.

ANALYSIS

Description of the Subject Property

9The Subject Property is a two-storey Single-Family Detached residential dwelling built in 1923, with an effective year built of 1966, located in the Lawrence Park neighbourhood in the City of Toronto. It has a lot with 50 feet (“ft.”) of effective frontage and 150 ft. of effective depth for an effective site area of 0.17 acres. It has a total building area of 1,800 square feet (“sq. ft.”), with construction quality of 7.0, with an unfinished basement area of 712 sq. ft. It has an attached garage of 200 sq. ft., built in 1923.

Issue 1 - What is the correct current value of the Subject Property for the 2020 and 2021 taxation years?

10In accordance with s. 44(3)(a) of the Act, the first mandate of the Board is to determine “the current value of the land”. Section 1 of the Act defines current value 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”. That is, for the 2020 and 2021 taxation years, the Board must determine what the Subject Property would have sold for in an arm’s length transaction on the January 1, 2016 valuation date set by the Act.

11The best evidence the Board can receive of current value is an arm’s length and market-tested sale of the Subject Property on the valuation date or close to it. If no such transaction took place, the next best measure of current value is arm’s length and market-tested sales of comparable properties located nearby, as close as possible to the legislated valuation date of January 1, 2016.

12The Board finds the current value of the Subject Property for the 2020 and 2021 taxation years to be $2,205,000 (rounded).

MPAC’s Proposed Comparable Property Sales

13MPAC presented the Board with six proposed comparable property sales. The details of these property sales are provided in Table 1 below:

Table 1

Address	Assessment ($)	Sale Date & Sale Amt. ($)	Time / Adjusted Sale ($)	Building/ Size (sq. ft.)	Lot Size (Acres)	Year Built/EYB	Renovation Code/year of renovation	Q of Const./ # of Stories
Subject Property
106 St. Leonard’s Avenue	1,903,000	N/A	N/A	1,800	0.17	1923/ 1966	“B”/ 1990	7.0/ 2 storeys
Sale 1
174 Dinnick Crescent	1,769,000	Oct. 2016 (2,395,000)	2,118,820	1,790	0.15	1925/ 1967	“B”/ 1990	6.5/ 2 storeys
Sale 2
176 Dinnick Crescent	1,826,000	Aug. 2016 (2,526,000)	2,290,316	1,845	0.15	1928/ 1995	“B”/ 1990 & 2010	6.5/ 2 storeys
Sale 3
236 Dawlish Avenue	2,258,000	Sept. 2015 (2,713,000)	2,849,856	1,855	0.17	1935/ 1970	“B”/ 1990	7.0/ 2 storeys
Sale 4
67 Weybourne Crescent	2,136,000	Jan. 2015 (1,955,000)	2,321,265	2,049	0.19	1921/ 1965	“B”/ 1990	7.0/ 2 Storeys
Sale 5
132 Cheltenham Avenue	2,280,000	Oct. 2015 (2,455,000)	2,542,201	1,923	0.17	1945/ 1974	“B”/ 1990	7.0/ 2 storeys
Sale 6
3 St. Aubyns Crescent	2,403,000	April 2015 (2,050,000)	2,320,645	2,043	0.19	1937/ 1971	“B”/ 1990	6.5/ 2 storeys

14The Board finds that MPAC’s comparable property Sale1 is inferior to the Subject Property, while comparable property Sales 2, 3, 4, 5, and 6 are superior to the Subject Property. Comparable property Sale 1 has a smaller lot size of 0.15 acres, a slightly smaller building, with a lower quality of construction of 6.5. Although it is 2 years newer than the Subject Property, it does not have a garage, compared to the Subject Property with a detached garage.

15During cross-examination, MPAC admitted that its comparable property Sale 2 was renovated and the Subject Property is unrenovated. MPAC further admitted that it arbitrary applied a renovation code “B” to the Subject Property due to its age although MPAC does not have any record of any renovation carried out on the Subject Property. Furthermore, MPAC testified that the renovation code “B” was applied to the Subject Property to account for maintenance of the Subject Property. The Board finds that maintenance of the Subject Property is not equivalent to a renovation, as MPAC testified that a renovation code “B” indicates that some degree of renovation occurred on the Subject Property. Therefore, comparable property Sale 2 with a finished basement is 72 years newer than the Subject Property. The Board finds that this makes property Sale 2 superior to the Subject Property.

16Comparable property Sale 3 is 12 years newer than the Subject Property, using its original year built of 1935. The building is slightly bigger than the Subject Property, but it has an identical site area of 0.17 acres with the Subject Property. This makes it slightly superior to the Subject Property, due to its age.

17Comparable property Sale 4 has a larger effective site area of 0.19 acres and a larger building area of 2,049 sq. ft. These features make it superior to the Subject Property, even though it is 2 years older than the Subject Property.

18Comparable property Sales 5 and 6 are both 22 and 14 years newer than the Subject Property. The buildings are larger than the Subject property with finished basements, making both properties superior to the Subject Property.

19MPAC testified that it used two tests to arrive at the Subject Property’s current value. For the first test, MPAC used the median time adjusted rate per sq. ft. of all its comparable property Sales at $1,212.53 and applied it against the total building area of the Subject Property at 1,800 sq. ft. for a value of $2,182,554. For the second test, MPAC used the median time adjusted sale price per effective site area of all its comparable property sales at $14,539,795.1 against the effective site area of the Subject Property at 0.17 acres, which provided a value of $2,471,765. MPAC arbitrarily used the first test with a lower value of $2,182,554 as the correct current value of the Subject Property. This method assumes that the comparable properties are similar, which will alter the rate per sq. ft.

Appellant’s Proposed Comparable Property Sales

20The Appellant argued that the Subject Property’s location is inferior to the location of all MPAC’s proposed comparable properties, therefore, the Appellant submitted that the best comparable property sales to determine the Subject Property’s current value are sales of properties on the same street as the Subject Property. The Board notes that MPAC presented comparable property sales within the same homogenous neighbourhood as the Subject Property.

21The Appellant presented two proposed comparable property sales. The Board finds that the Appellant’s comparable property Sale 1 - 82 St. Leonard’s Avenue is not comparable to the Subject Property being on a corner lot, and the Subject Property is not on a corner lot. These two properties will not transact similarly in the open market. Furthermore, its land size of 0.11 acres is much smaller than the Subject Property’s lot size of 0.17 acres.

22The Board finds that the Appellant’s second comparable property Sale - 59 St. Leonard’s Avenue is superior to the Subject Property. It has an original year built of 1926, making it three years newer than the Subject Property, its building size of 2,308 sq. ft. is much larger than the Subject Property and its structure of 2 ½ storeys is different than the structure of the Subject Property, which is 2 storeys. It sold May 2016 for $2,500,000 at a time adjusted sale price of $2,355,000.

23The Appellant argued that based on MPAC’s admission that its comparable property sales 1, 2, 3, 4, and 6, were purchased for redevelopment, makes these properties higher in value than the Subject Property. The Appellant further argued that a developer will pay more for these properties regardless of their size, as it intends to make more profit to sell to subsequent purchasers. The Appellant further provided the multiple listing service (“MLS listing”) of MPAC property Sales 3 and 6, which were rebuilt and sold in 2018 for over $5 million. The Appellant’s representative, Surin Toor, testified that when these properties sold, they were sold with approvals to rebuild. MPAC disagreed. The Board finds that the Appellant did not provide any corroborating documentary evidence to prove that these properties did not sell based on the market and that they were sold with approvals to rebuild. The Appellant did not argue that they were not valid sales, sold within the shoulder years of January 1, 2016, which is one year on either side of the valuation date.

24The Appellant further argued that MPAC’s comparable property Sales 3, 5 and 6 are located on the east side of the Subject Property, which is a superior location than the location of the Subject Property, making these properties more valuable. MPAC disagreed. The Board finds that the Appellant did not provide any documentary evidence to support this argument and the sales do not prove it. Comparing the Appellant’s property Sale 2 (which sold at a time adjusted sale price of $2,355,000, which the Board determined to be superior to the Subject Property) to MPAC’s property Sale 6, which is situated on a larger lot of 0.19 acres, 11 years newer than the Appellant’s Property Sale 2, with the biggest basement area compared to all MPAC’s comparable property sales, part of which is finished, sold at a lower time adjusted sale price of $2,320,645. Although it has a lower quality of construction of 6.5. Furthermore, MPAC’s Sale 4, which is on the west side of the Subject Property, sold at a time adjusted sale price of $2,321,265, without a finished basement, more than MPAC’s Property Sale 6, which the Appellant argued has a superior location.

Finding on Current Value

25The Board determines the current value of the Subject Property based on the current value range established by these inferior and superior comparable property sales. On a balance of probabilities, the current value of the Subject Property should fall within the time adjusted sale price range of MPAC’s inferior property Sale 1, which has a time adjusted sale price of $ 2,118,820 and MPAC and the Appellant’s superior property sales 2, 3, 4, 5 and 6 being $2,290,316 - $2,849,856.

26The mid-point of the current value range is $2,204,568. The Board finds the correct current value of the Subject Property to be $2,205,000 (rounded).

Issue 2 - 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) 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.

27Section 44(3)(b) of the Act directs that after determining current value, 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.

28The Assessment to Sales Ratio (“ASR”) is a tool often used to determine if a reduction in the assessment below current value is required to make an assessment equitable with the assessments of similar lands in the vicinity. The ASR is determined by dividing the assessment as returned by the time adjusted sales price.

29MPAC presented an equity analysis of 30 Single Family Detached residential properties with sales that occurred from January 1, 2015 to December 31, 2016. MPAC used further search criteria of lot size between 0.14 to 0.19 and building size not less than 3,000 sq. ft. The median ASR of the sales is 0.93. MPAC submitted that the International Association of Assessing Officers standards states that the level of appraisal for all properties should fall between 0.90 and 1.10. MPAC takes the position that equity is achieved if the median ASR falls between 0.95 – 1.05.

30MPAC submitted that with a median ASR of 0.93, based on its equity analysis, equity has not been achieved therefore it applied the median ASR to its current value and reduced it to $2,029,775. MPAC submitted that this is higher than the assessment as returned therefore requested the Board confirms the assessment as returned at $1,903,000.

31The Appellant provided 39 property sales, which included all of MPAC’s 30 properties and nine additional properties, which the Appellant argued MPAC did not include but marched the criteria MPAC used, which is the same the Appellant used. The Appellant provided the median ASR of the first 30 properties as 0.895, and the median of all 39 property sales as 0.897. During cross-examination, the Appellant admitted that its property Sale 1 presented as a proposed comparable property sale to determine the current value of the Subject Property was not included in its equity analysis. MPAC submitted that including it will provide a median ASR of 0.891.The Appellant applied the median ASR of 0.891 against the returned assessment stating that MPAC did not discharge it onus of proving the current value of the Subject Property, therefore this will reduce the current value to $1,695,573. In the alternative, the Appellant applied the median ASR of 0.891 against the current value of $1,836,648, which reduces it to $1,636,453.

32MPAC argued that the data on most of the additional sales used by the Appellant were not accurate and some of the building areas of these properties did not march MPAC’s criteria of less than 3,000 sq. ft. However, MPAC admitted that these nine additional sales were valid sales and their assessments were accurate.

33For equity, the comparable properties need not be similar as it is needed in the determination of the correct current value. As determined by the Ontario Divisional Court in Municipal Property Assessment Corp. v. Loblaw Properties Ltd., 2017 ONSC 1299, applying the decision in Trizec Equities Ltd. v. Ontario (Regional Assessment Commissioner, Region No. 27), [1988] O.J. No. 182, “…All points of comparison must be considered…” The selection of these 40 properties from both the Appellants and MPAC provides similar properties as the Subject Property, in terms of location; they are all within the same homogenous neighbourhood as the Subject Property with distance of not more than 0.840 kilometers from the Subject Property, their nature - all single family detached homes, and use - all residential properties.

Finding on Equity

34The Board used the Appellant’s equity analysis, which is a combination of MPAC’s 30 properties and 10 of the Appellant’s properties (including the Appellant’s comparable property sale 1). This provides the Board with a more representative sample size, which is preferred and will provide a general level of assessment of similar lands in the vicinity. The corrected median ASR for the 40 properties is 0.897, when applied against the determined correct current value of $2,205,000, this provides a value of $1,977,885. The Board therefore reduces the current value of the Subject Property to $1,978,000 (rounded).

CONCLUSION

35Although the evidence adduced indicates that the correct current value of the Subject Property should be as high as $1,978,000, MPAC’s position is that the assessed value as returned at $1,903,000 should be confirmed. The Board finds that the correct current value of the Subject Property is $1,903,000 for the 2020 and 2021 taxation years.