ONTARIO SUPERIOR COURT OF JUSTICE (Divisional Court)
Divisional Court File No.: 31/13 Date: 2013xxxx
B E T W E E N:
CANADIAN NATIONAL RAILWAY COMPANY Applicant
- and -
MUNICIPAL PROPERTY ASSESSMENT CORPORATION and CITY OF VAUGHAN Respondents
Counsel: David Fleet for the Applicant Melissa E. VanBerkum for MPAC Stephen Longo for City of Vaughan
HEARD: December 6, 2013
BEFORE: M.A. SANDERSON J.
Reasons for Decision
Introduction
[1] Canadian National Railway Company ("CN") seeks leave to appeal the decision of the Assessment Review Board ("the Board") made pursuant to s. 447.70 of the Municipal Act, released on December 18, 2012.
[2] Counsel for CN submitted that the Board erred in law in its interpretation of "similar land in the vicinity" and in declining to accept CN’s choice of the Canadian Pacific Railway yard also located in Vaughan as a comparable property.
Test On Leave To Appeal
[3] An appeal from the Assessment Review Board lies to this Court with leave on questions of law.
[4] Before leave is granted, there must be good reason to doubt the legal correctness of the Board's decision. The appeal must involve an important question of law: BCE Place Ltd. v. Municipal Property Assessment Corp., Region No. 9 [2008] Carswell Ont 8770 (Div. Ct.) at paragraph 4.
[5] The purpose of s. 447.70 is "to ensure that eligible properties are taxed at the same level as comparable properties (447-70(1).
[6] The Board held that while the CN rail yard and CP rail yard are both rail yards owned and operated by two federally regulated railroads, there are also substantial differences between them. After conducting a "weighing and balancing exercise" the Board concluded they were not "directly comparable for the purpose of ensuring tax fairness."
[7] Counsel for CN submitted the Board erred in creating "a new test" contrary to the existing jurisprudence and in failing to apply the correct test to ascertain similar lands in the vicinity"the general nature, character or function." He submitted the Board incorrectly directed itself toward elements of dissimilarity, rather than characteristics of similarity. The decision of the Board was contrary to the preponderance of evidence and to the Board's own findings.
Analysis
[8] The Board's decision contains a careful and thorough review of the facts and evidence. It also includes a detailed summation of the legal argument advanced by all three parties.
[9] In my view, counsel for CN incorrectly attempted to characterize the Reasons of the Board as having created and applied a new and legally incorrect test. Read in its entirety and in context, I have concluded that the Board did not base its conclusions on an understanding or requirement that a property, to be comparable, must be "directly" comparable to the subject property in the sense of identical.
[10] The Board did have regard to the general nature, character and function of the two properties. Its failure to use the word "general" in its reasons is not indicative of a failure to apply the appropriate test. In light of the overall analysis that it did and outlined in its Reasons, the Board's failure to use the word "general" along with the words it did use, nature, character and function, is not determinative.
[11] Counsel for CN submitted that the Board should have concluded that the CN and CP properties were of the same general nature, character and function, and stopped there. I do not accept that submission. The Board correctly considered nature, character and function in determining comparability and applied an "all points of comparison" test, as did the Supreme Court of Canada in OPAC, Reg. No. 13 v. Downtown Oshawa Property Owners Association, 1978 Carswell Ont 603 (S.C.C.), [1978] 2 S.C.R. 1030 at page 4. The Board considered many points of comparison between the CN and CP properties, their similarities and differences. After considering all of them and conducting a weighing and balancing exercise, it made the factual finding that the properties were not comparable.
[12] In Trizec Equities 1988 Carswell Ont 549, 270 A.C. 203, the Divisional Court, citing the decision of the Supreme Court in Downtown Oshawa, held all points of comparison must be considered. The Board must make factual findings based on the evidence before it. One point of similarity such as use, may be, but is not necessarily, determinative. Some similarities may be overridden by other characteristics. Some differences may be subordinated.
[13] The Board correctly identified and applied Chan v Toronto 2010 Carswell Ont 525 at paragraphs 84 and 120 of its Reasons, noting that "similar" may relate to matters including design, size, age, amenities, construction, distinctive location, etc. The closer to identical that like properties are, the greater their similarity. All factors of comparison should be considered in establishing similarity. The more characteristics properties have in common, the greater the similarity.
[14] The Board should consider each circumstance on its own merits; relative weighing of the factors is the Board's responsibility, considering that totality of the evidence.
[15] The Board noted the functional differences between the CN and CP sites and had regard to the differing characteristics listed in Exhibit 13, including but not limited to the following: The CN site is 969.7 acres. The CP site is 509.95 acres. The total building size of the CN site is 1,161,354 square feet. The total building size of the CP site is 46,915 square feet. In the relevant period, the assessment for property tax purposes of the CN property was 4.4 times greater than CP's. The building assessment for the CN property was 9.15 times greater than the building assessment for the CP property. 60-80 trains pass through the CN property daily, compared to 4 trains through the CP property.
[16] In short, the Board concluded correctly that there were significant and stark differences between the CN and CP sites, in terms of size, zoning, total building area, building to land ratio, miles of track, numbers of trains passing through the site daily, and assessed values. These were important and valid indicia of comparability. As part of the weighing and balancing process, the Board was bound to have regard to them.
[17] I am of the view that in this case the Board considered and applied the proper considerations based on the best evidence before it, rather than fixating on only one consideration – use of both properties as rail yards. When nature, character, function and all points of comparison were considered, it was open to the Board to conclude on the totality of the evidence that the properties were not comparable.
[18] The Act does not require the Board on appeal to find that comparable properties exist.
[19] In my view, the Board made no overriding or palpable factual error. The Board did not misapprehend the evidence. There is no good reason to disturb its findings of fact. It is not for this Court to redo the weighing exercise.
[20] I am satisfied the Board applied the proper legal principles to the best evidence before it. It made no error of law.
[21] There is no good reason to doubt the correctness of the decision.
[22] The motion does not raise important questions of law.
Disposition
[23] Therefore, CN’s application for leave to appeal is dismissed.
[24] The parties may make brief written submissions on costs on or before January 8, 2014.
M.A. SANDERSON
Released:
Divisional Court File No. 31/13
Date: 2013xxxx
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
CANADIAN NATIONAL RAILWAY COMPANY
(Applicant)
- and –
MUNICIPAL PROPERTY ASSESSMENT CORPORATION and CITY OF VAUGHAN
(Respondent)
REASONS FOR DECISION
M.A. SANDERSON J.
[25]
Released: 2013