Ronald Allan Marshall v. Municipal Property Assessment Corporation Region 23, 2026 CanLII 5001

Assessment Review Board

Tribunals Ontario Tribunaux décisionnels Ontario Assessment Review Board Commission de révision de l’évaluation foncière

ISSUE DATE: January 22, 2026 FILE NO.: WR 189642

Assessed Person(s): Ronald Allan Marshall Appellant(s): Ronald Marshall Respondent(s): Municipal Property Assessment Corporation Region 23 Respondent(s): Township of Zorra

Property Location(s): 45525 45th Line Municipality: Township of Zorra Roll Number: 3227-013-030-06900-0000 Appeal Numbers: 3537579, 3530633, 3535992 Taxation Years: 2022, 2023, 2025 Hearing Event No.: 790265

Legislative Authority: Sections 33, 36 and 40 of the Assessment Act, R.S.O. 1990, c. A.31

APPEARANCES:

Parties	Representative
Ronald Allan Marshall	Self-represented
Municipal Property Assessment Corporation	Michael Radan
Township of Zorra	Nicole Bowery

HEARD: November 19, 2025 by video conference

ADJUDICATOR: Steve Gilchrist, Member

DECISION

OVERVIEW

1Ronald Allan Marshall (the “Appellant”) is the owner of a residential property located at 455259 45th Line, Township of Zorra (the “Subject Property”). The Appellant appealed the 2022, 2023 and 2025 assessment of the Subject Property to the Assessment Review Board (the “Board”) under s. 33 and s. 40 of the Assessment Act, R.S.O. 1990, c. A.31 (the “Act”) on the ground that the classification of land use on the property was incorrect.

2Under s. 19(1) the assessment of land for purposes of municipal taxation is based on the land’s current value. 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.

3Section 19(5) of the Act states that,

For the purpose of determining the current value of farm lands used only for farm purposes by the owner or used only for farm purposes by a tenant of the owner and buildings thereon used solely for farm purposes, including the residence of the owner or tenant and of the owner’s or tenant’s employees and their families on the farm lands,

1. Consideration shall be given to the current value of the lands and buildings for farm purposes only”;

2. Consideration shall not be given to sales of lands and buildings to persons whose principal occupation is other than farming; and,

3. The Minister may, by regulation, define “farm lands” and “farm purposes 2000 c.25, ss 5(1)

4Pursuant to s. 19.2 of the Act, January 1, 2016 is the day on which the Subject Property is valued for these taxation years.

5As a result of their analysis of the Subject Property as of January 1, 2016, MPAC returned a value of $42,500 for the effective omitted assessment dated December 14, 2022 and a value of $2,525,000 for the effective omitted assessment date January 1, 2024 and a value of $2,525,000 for the annual assessment with the effective date January 1, 2025.

6MPAC submitted that its assessments reflect the correct current value of the Subject Property after consideration of the improvements that have been made to the property.

7At the completion of the hearing, the Board delivered its decision.

8After the hearing event it came to the Board’s attention that for the s. 33 2022 omitted assessment an update was required to the classification from Industrial to Commercial due to a Property Assessment Change Notice issued by MPAC. The Board has updated its records. The s. 33 2024 omitted assessment required an update to the value, effective date and classification also due to a Property Assessment Change Notice issued by MPAC. The value changed to $42,500 at the effective date of January 1, 2023 in the Commercial property class. The Board has also updated its records.

Background

9The Appellant owns a 99-acre dairy farm that has been in his family for over 150 years. In 2022, he applied to the Township of Zorra for a rezoning which would permit the construction of a new building which would include the necessary equipment to make cheese from the milk produced on the farm. It would also include pasteurization equipment and a retail space for selling various farm products, including a unique self-serve milk dispenser. Upon receiving zoning approval, the Appellant constructed a 2,500 square foot building.

10As a result of the improvement of the property, in April 2024, MPAC reassessed the property and reclassified a portion of the lands from “rural” to “industrial” and “commercial”. Upon further review, MPAC revised the “commercial” portion to “industrial”, applying that classification to the entirety of the new building.

11The Appellant questions the appropriateness of the “industrial” classification, in light of the small scale of their cheese and milk operations and in light of the zoning designation of the property, which is “A2” “General Agricultural Zoning for “on-farm diversified use”.

Areas of Agreement

12The parties agree on the current value assessment for the years under appeal as being fair and reasonable. The parties also agree that there is no equity issue, and the Subject Property has been assessed fairly and equitably.

Issues for the Hearing

13At issues in this proceeding is:

1. Is the MPAC classification of uses on the Subject Property correct?

2. What is the correct allocation of value between the various land uses on the property?

3. Is the current value as determined by the Board equitable in reference to the assessments of similar lands in the vicinity?

Result

14The Board finds that the current classification of land uses on the Subject Property accurately reflect the actual uses and have been applied in a manner which is consistent with the provisions of the Act and MPAC’s assessment methodology. The appeals are dismissed.

15As neither party raised the issue, the Board finds that no equitable adjustment was required pursuant to s. 44(3)(b) of the Act. As such, the Board finds no reduction of the assessed value is required.

ANALYSIS

Description of Subject Property

16The Subject Property is situated in the community of Golspie, located in the Township of Zorra within Oxford County. The Subject Property is located on a corner lot, with Road 74 to the north and 45th Line to the east. The Subject Property abuts farm properties on all sides and is located to the north of Ingersoll and to the west of Woodstock. The surrounding area consists of predominately farmland, with some residential areas. The Subject Property conforms to the general nature of the neighbourhood.

17The Subject Property is a 99-acre dairy farm, with two residential buildings and a variety of other farm-related structures, including a 2,500 square foot custom-built building that houses dairy-related activities including cheese-making, milk pasteurization and farm product retailing and was built in 2022.

Issue 1 – Is the MPAC classification of uses on the Subject Property, correct?

Legal Test

18Section 6 of Ontario Regulation 282/98 (“O. Reg 282/98”) lays out the criteria for determining whether lands should be classified in the industrial property class:

6. (1) The industrial property class consists of the following:

7. Land used for or in connection with,

i. manufacturing, producing or processing anything,

iii. storage, by a manufacturer, producer or processor, of anything used or produced in such manufacturing, production or processing if the storage is at the site where the manufacturing, production or processing takes place, or

iv. retail sales by a manufacturer, producer or processor of anything produced in manufacturing, production or processing, if the retail sales are at the site where the manufacturing, production or processing takes place

Appellant’s Evidence and Submissions

19The Appellant submitted a brief that provided an overview of the operations on his dairy farm, including the addition of a cheese-making and milk pasteurization operation, housed in a new building, in 2022.

20The Appellant challenges the classification of that building as “industrial” and, instead, submits that no change should have been made to the classification of the farm lands as a result of the addition of the new building. In the alternative, he argues that the classification should be “commercial” to better reflect the small-scale operations and the significant percentage of the building which is allocated to retail use.

21The Appellant states that the production of the milk and cheese should be considered simply an extension of the pre-existing generation of farm products which serves as one more means of having farm products make their way to the ultimate consumer.

22The Appellant cited the apparent contradiction between the way that cooling milk is regarded as a non-industrial activity while the heating of milk is considered an industrial process. The Appellant also noted that the nature of their processing, with their operations being done in small batches, instead of in a continuous process, is inconsistent with the processing methodology of large industrial dairies.

23The Appellant questioned why MPAC applied a combination commercial and industrial classification to two of the four dairy operations which MPAC cited as comparable properties.

24The remedy the Appellant is seeking is the reclassification of the cheese and milk processing building from the “Industrial” to the “Farm Property” tax class.

MPAC’s Evidence and Submissions

25MPAC inspected the Subject Property on March 6, 2025. Their inspection revealed 17 assessed structures on the Subject Property, including two residential buildings, several buildings related to farm activities and a new structure which they described as an “on farm milk and cheese processing plant”.

26In their original assessment, they classified the building as “Commercial Taxable”. After further consideration of the applicability of s.6(1) of O. Reg 282/98 they determined that the processing of cheese and milk qualified as an industrial activity. MPAC reclassified the entirety of the new building as “Industrial Taxable”. MPAC cited Section 6(1) iv as the direction to include the retail portion of the building as “Industrial Taxable”.

27MPAC noted that they recognized the relatively small scale of the dairy processing on the Subject Property and classified the maximum allowable portion of the industrial building under the “Small Scale On-Farm Business Subclasses”. The classification under industrial tax classes I0 and I7 would make the building eligible for tax reductions.

28Section 22 of O. Reg 282/98 provides direction on this subject:

22. (1) Two subclasses for small-scale on-farm business are prescribed for each of the industrial and commercial property classes. O. Reg. 828/21, s. 1.

(2) Subject to subsections (4) and (5), the subclasses for small-scale on-farm business for the industrial property class consist of land in that class that satisfies the following requirements:

1. The land is used primarily to process, or manufacture something from, a farm product or products that are produced on the land or on land used to carry on the same farming business.

2. The land would be in the farm property class if the activities described in paragraph 1 were not carried out on the land. O. Reg. 828/21, s. 1

Analysis

29As the parties have agreed on the valuation of the Subject Property, the Board can dispense with any commentary on how that value was derived, aside from noting that MPAC prepared a detailed analysis which included their rationale for development the land values, based on comparable sales, and the improvements, based on the cost approach.

30When considering the classification of the improvements made to the Subject Property in 2022, MPAC determined that the processing of milk/cheese would be considered as an industrial activity in accordance with s. 6(1) i. of O. Reg 282/98., and therefore the new building should be classified as “industrial”. As required under s. 6(1) iv of O. Reg 282/98, the entire building would be classified as industrial as the retail store is located within the site where the processing takes place.

31As part of their valuation report, MPAC included details on four other dairy farms which had developed similar cheesemaking and/or milk pasteurization and retail operations on their farms. Two of those operations were classified as “industrial” uses while two were classified as a combination of “industrial” and “commercial”. Under questioning, MPAC was unable to provide an explanation for those differing classifications. Notwithstanding this lack of explanation, the Board is satisfied that the definition of “industrial” uses under O. Reg 282/98 should be the final authority when determining the classification of the Subject Property.

32Table 1 contains the details on the four comparable dairy operations cited in the MPAC report.

Table 1

	Subject Property	Property 1	Property 2	Property 3	Property 4
Roll Number	3227-013-030-06900	3120-140-002-01800	3202-040-040-07600	3018-010-001-13500	3408-014-020-02100
Address	455259 45th Line	5021 Perth Line 8	445172 Gunn’s Hill Rd	3165 Huron Rd	47060 Yorke Line
Property Code & Description	(221) Farm with Residence – Commercial/Industrial Operation	(221) Farm with Residence – Commercial/Industrial Operation	(221) Farm with Residence – Commercial/Industrial Operation	(221) Farm with Residence – Commercial/Industrial Operation	(221) Farm with Residence – Commercial/Industrial Operation
Company Name	Golspie Dairy	Stonetown Artisan Cheese	Gunn’s Hill Artisan Cheese	Mountainoak Cheese	Mistyglen Creamery
Distance in KM		34.272	14.4961	29.3403	34.057
Structure Description	Cheese/Milk Plant	Cheese Plant	Cheese Plant	Cheese Plant	Cheese/Milk Plant
Year Built	2022	2015	2011 (2015 addition)	2012 (2022 addition)	2022
Building Total Area (SF)	2,500	8,160	10,700	6,437	4,896
Classification	Commercial & Industrial	Industrial	Commercial & Industrial	Industrial	Commercial & Industrial

Findings on Issue 1

33The Board is satisfied that the Subject Property is comparable to the four properties submitted by MPAC and that the Subject Property should be classified as “(221) Farm with Residence – With Commercial/Industrial Operation”.

34The parties agree with the assessed value of the Subject Property. This has left the Board with a very specific and focused challenge, namely, to determine whether MPAC has accurately and fairly classified the various improvements and the land for this property.

35Even within that issue, based on the evidence and submissions, there is no disagreement between the parties on any allocation of land between the various uses, nor with any issues related to the residential, farmland or forest land classifications. The sole area of disagreement lies with the classification, by MPAC, of the cheese production, milk pasteurization and dairy products retail operation which were constructed on the property in 2022.

36MPAC has cited several authorities which support the proposition that the change in nature or use of any raw material can be considered an industrial use. In particular, the Board notes the facts in Donlands Dairy Ltd v Ontario (Regional Assessment Commissioner, Region No 11), [1973] OJ No 718 (“Donlands”) directly on the cheese and milk processing on the Subject Property. The Donlands decision specifically dealt with the question of whether “pasteurization” constituted “processing”. The settling of that question was not based on the scale of the operation but on the nature of the operation.

37The criteria for determining “processing” are: 1) the treatment must make the goods more marketable and 2) there must be some change in the appearance or nature of the goods. The Board is convinced that converting raw milk to cheese and/or pasteurized milk both makes the product more marketable and changes the appearance and nature of the milk. The Board is satisfied that the operations in the dairy products building meet the definition of “processing”.

38MPAC has also listed four comparable farm operations in the general proximity of the Subject Property which include cheese and/or milk pasteurization on the property and all of which have either an all industrial or a combined industrial and commercial classification.

39The Appellant argued that the diary processing building should not be considered industrial due to the small-scale nature of its operations. The evidence before the Board is that MPAC has recognized the small-scale of the dairy operation and has designated the maximum possible portion of the industrial building as a small-scale, value-added farm structure in the IND I0 and IND 17 tax classes. This classification offers a potential 75% reduction in the property taxes which would otherwise be payable on industrial improvements on the property.

40The Appellant has raised the issue that Oxford County has not passed enabling legislation to allow affected taxpayers, within its jurisdiction, to take advantage of the tax reductions appertaining to those tax classes. It would appear that therein lies the root of the concerns expressed by the Appellant.

41MPAC, by statute, has no role in the setting of mil rates and the administration of local property tax by-laws. There is no doubt that the Appellant is caught in the middle of a jurisdictional separation of powers, but the Board can only deal with the assessment issues.

42The Board notes that the property tax system in Ontario is designed with fairness and equity as key considerations. When the province designs specific tax rates, such as managed forests, conservation lands and small-scale industrial classifications, it reflects their belief that those uses warrant tax reductions. It could be argued that a disservice is done to property owners who would otherwise by eligible for these tax reduction classifications, in those municipalities who choose to ignore the opportunity to enact them. The forum for rectifying this issue, though, is not this Tribunal, but, rather, with the upper tier municipality and the province.

43In terms of the classification of the land and buildings, the Board finds that MPAC has met their onus of demonstrating the accuracy and fairness of their assessment. There is no evidence that, at any stage of their determination, they have erred in following the valuation and appraisal standards to which they are expected to adhere. The Appellant raised an important question of the appropriateness of the allocation of land classifications, on his property, but he did not offer any specific suggestions as to where MPAC erred in the valuation and, most importantly, what he would like to see changed in the assessment, specifically. In fact, MPAC’s evidence is that changing the classification of the building, from industrial to commercial, would not change the current value assessment of the building.

44It is worth noting that, if the small-scale industrial tax categories which MPAC has applied to the industrial building were activated by the County of Oxford, the Appellant would be in a superior position when compared to having the building designated in any other industrial or commercial classification.

45Under the statute, though, the Board can only deal with the assessment matters related to MPAC’s determination of land classification and values. The Board finds that MPAC has justified the current value assessment of $42,200 for the 2022 taxation year and $2,525,000 for the 2025 taxation year and, further, that their classification of the various land uses on the Subject Property are correct.

Issue 3 - Equity

46As neither party raised the issue, the Board finds that no equitable adjustment was required pursuant to s. 44(3)(b) of the Act. As such, the Board finds no reduction of the assessed value is required.

ORDER

47The Board finds that the current classification of land uses on the Subject Property accurately reflect the actual uses and have been applied in a manner which is consistent with the provisions of the Act and MPAC’s assessment methodology. The appeals are dismissed.