The Diocese of Toronto Camps (Anglican Church of Canada) v. Municipal Property Assessment Corporation, Region 16 et al. [Indexed as: Diocese of Toronto Camps (Anglican Church of Canada) v. Municipal Property Assessment Corp., Region 16]
67 O.R. (3d) 619
[2003] O.J. No. 4129
Divisional Court File No. 2/02
Ontario Superior Court of Justice
Divisional Court
Lane, Somers and Greer JJ.
October 21, 2003
Assessment -- Exemptions -- Applicant requesting exemption from property taxation for land on which it operated non-profit children's camp -- Camp was intended to teach life skills to special needs children while teaching other children how to live together with special needs children -- Application judge erring in dismissing application on basis that camp was summer recreational camp and did not fall into exemption set out in s. 3(1)11 of Assessment Act -- Test for determining whether exemption should be granted is whether primary purpose of institution comes within words defining exemption -- Camp was place for "care of children" within meaning of s. 3(1)11 -- Assessment Act, R.S.O. 1990, c. A.31, s. 3(1).
The applicant brought an application requesting an exemption from property taxation for certain lands owned by it which were used for the purpose of a children's camp. The applicant claimed that it operated the camp for the general welfare of children without gain or profit, and that the camp's composition of campers included those with special needs and children who were subsidized to attend. The application judge dismissed the application, holding that the camp did not fall within either of the exemptions set out in s. 3(1)5 and 11 of the Assessment Act, R.S.O. 1990, c. A.31 (i.e., a "seminary of learning" or a place for "the care of children"). He found that the camp's purpose was a summer recreational camp for children, that the strong learning component of the camp's program was ancillary to the recreational component of the camp, and that the percentage of handicapped children who were integrated into the camp did not exceed 12 per cent of the total number of campers in attendance. The applicant appealed.
Held, the appeal should be allowed.
The words of s. 3(1)5 and 11 of the Assessment Act were to be read in their entire context and in light of the scheme and object of the Act and the intention of the legislature. The test for determining whether an exemption should be granted is whether the primary purpose of the institution comes within the words defining [page620] the exemption in the Act. The application judge made an error of mixed fact and law in finding that the camp did not fall within the relevant exemptions. The evidence made it clear that the children who attend the camp are "cared for" by the camp staff, with some requiring more care than others. The camp could only be seasonal in nature, given its location and given the needs of the children who attend. If the legislature intended that the "care of children" be year-round or that the children must live in full-time institutions, the Act would have said so. The legislature clearly had no general intention of excluding institutions where there is part-time use only. The Act focuses on the institution, and the institution in this case cared for children on a constant basis throughout the season, although the children themselves changed. The primary purpose of the camp was the care of children in a very special educational setting. It provided children with special needs with an environment where they could learn sufficient life skills to enable them to cope with the outside world, while at the same time teaching "normal" children how to live together with children with special needs. This combination of the care of children with the camp's charitable and educational purpose lifted the camp out of the category of the purely recreational. That not all of the children were special needs children was actually necessary for the camp to fulfill its purpose. The camp was an institution for the care of children within the meaning of s. 3(1)11 of the Act.
Buanderie centrale de Montréal Inc. v. Montreal (City); Conseil de la santé et des services sociaux de la région de Montréal métropolitan v. Montreal (City), 1994 59 (SCC), [1994] 3 S.C.R. 29, 63 Q.A.C. 191, 172 N.R. 19, [1994] S.C.J. No. 80 (QL); Childreach Centre v. Ontario (Regional Assessment Commissioner, Region No. 23), [2000] O.J. No. 5039 (QL), 16 M.P.L.R. (3d) 191, [2000] O.T.C. 913 (S.C.J.); Housen v. Nikolaisen, [2002] 2 S.C.R. 235, 219 Sask. R. 1, 211 D.L.R. (4th) 577, 286 N.R. 1, 272 W.A.C. 1, [2002] 7 W.W.R. 1, 30 M.P.L.R. (3d) 1, 2002 SCC 33, 10 C.C.L.T. (3d) 157, [2002] S.C.J. No. 31 (QL); M.T. (Re) (1983), 1983 4585 (ON CJ), 36 R.F.L. (2d) 386, [1983] O.J. No. 787 (QL) (Prov. Ct.); Ontario Property Assessment Corp. v. Praxair Canada Inc. (2002), 26 M.P.L.R. (3d) 262, [2002] O.J. No. 121 (QL), 155 O.A.C. 360 (S.C.J.); Percy v. Sedgley, [1998] O.J. No. 4052 (QL), 76 O.T.C. 112 (C.J. (Gen. Div.)); Presbyterian Church in Canada v. Ontario (Regional Assessment Commissioner, Region No. 22), [1995] O.J. No. 1492 (QL) (O.C.J. (Gen. Div.)); Stein Estate v. Kathy K (The), 1975 146 (SCC), [1976] 2 S.C.R. 802, 62 D.L.R. (3d) 1, 6 N.R. 359; Xerox of Canada Ltd. v. Regional Assessment Commissioner, Region No. 10, 1981 58 (SCC), [1981] 2 S.C.R. 137n, 13 O.M.B.R. 41n, 1981 2992 (ON CA), 127 D.L.R. (3d) 511n, revg (1980), 1980 1627 (ON CA), 30 O.R. (2d) 90, 11 O.M.B.R. 238, 115 D.L.R. (3d) 428, 17 R.P.R. 72 (C.A.), affg (1979), 1979 2076 (ON SC), 27 O.R. (2d) 269, 10 O.M.B.R. 271, 106 D.L.R. (3d) 147 (Div. Ct.)
APPEAL from an order dismissing an application for exemption from property taxation.
Buenavista on the Rideau v. Ontario (Regional Assessment Commissioner, Region No. 2) (1996), 1996 11792 (ON SC), 28 O.R. (3d) 272, 134 D.L.R. (4th) 278, 34 M.P.L.R. (2d) 71 (Div. Ct.); Rizzo & Rizzo Shoes Ltd. (Re), 1998 837 (SCC), [1998] 1 S.C.R. 27, 36 O.R. (3d) 418n, 154 D.L.R. (4th) 193, 221 N.R. 241, 50 C.B.R. (3d) 163, 33 C.C.E.L. (2d) 173, 98 C.L.L.C. Â210-006 (sub nom. Ontario Ministry of Labour v. Rizzo & Rizzo Shoes Ltd., Adrien v. Ontario Ministry of Labour), apld Other cases referred to Statutes referred to Assessment Act, R.S.O. 1990, c. A.31, ss. 3(1), 46(4) Interpretation Act, R.S.O. 1990, c. I.11, s. 10 Authorities referred to Driedger, E., Construction of Statutes, 2nd ed. (Toronto: Butterworths, 1983) [page621] Sullivan, R., Sullivan and Driedger: Construction of Statutes, 4th ed. (Markham: Butterworths, 2002)
Yvonne Hamlin, for applicant. Ian Rowe, for Municipal Property Assessment Corporation.
The judgment of the court was delivered by
[1] GREER J.: -- The Diocese of Toronto Camps (Anglican Church of Canada) ("the Diocese") appeals from the Order of Mr. Justice Matlow made December 6, 2001, wherein he dismissed an application by the Diocese requesting an exemption from property taxation for the lands owned by it in the Township of Rama and used for the purposes of Camp Couchiching ("the Camp").
[2] In his reasons, the application judge found that the Camp did not fall within either of the exemptions as set out in s. 3(1)5 and 11 of the Assessment Act, R.S.O. 1990, c. A.31, as amended (the "Act"). He found that the Camp was neither a "seminary of learning" nor a place for "the care of children". To the contrary, the application judge found that the Camp's purpose was the operation of a summer recreational camp for children. He further found that the strong learning component to the Camp's programme is ancillary to the recreational component of the Camp.
[3] The application judge also found that the percentage of handicapped children who were integrated into the Camp's programmes did not exceed 12 per cent of the total number of campers in attendance.
[4] The Camp is the only such property owned by the Diocese and its operation is structured as a without share capital corporation. The Letters Patent of the Camp, dated January 13, 1982, set out the objects of the Camp as follows:
(a) to operate and manage camps and to provide for the holding of conferences, the delivery of lectures and the carrying on and promotion of courses or schools of religious education;
(b) to undertake such enterprises as may be considered desirable for the spiritual, mental, social and physical strengthening and improvement of children and young people; and
(c) to do all such other things as are incidental or conducive to the attainment of these objects.
[5] It is the position of the Diocese that it operates the Camp for the general welfare of children without gain or profit. All [page622] money received by the Camp is put back into the Camp. The Camp's composition of campers includes those with special needs, children who are subsidized to attend, and others who are regular campers. The Camp is operated as an integrated camping facility, with most campers attending for a two-week period without parents in attendance.
[6] The application judge held in his endorsement that the attendance by the campers for two-week periods is "also ancillary to the recreational nature of the camp". He further states that the campers "generally have permanent homes elsewhere to where they return . . .".
[7] The Diocese points out, however, that the Camp, since 1994, has focused on integrating special needs campers in participating with regular campers. These "Special Group Partnerships", as they are called, include such organizations as Epilepsy Ontario, the Departments of Neurology, Haematology and Respiration at Toronto's Hospital for Sick Children, Project Rainbow and others. The Camp also attracts children who have asthma, or severe allergies, as well as those who suffer anaphylactic reactions, because the Camp has a renowned reputation as being experienced in dealing with children who require special care. Forty per cent of those campers attending have a medical condition stated.
[8] The Diocese has fully set out in its Factum the details of the various components of the care the Campers receive, including the provision of shelter, meals, behavioural and hygienic supervision, medical care and attending to special medical needs, the provision of recreational activities, and financial support to certain campers who could otherwise not attend. Further, there is the training of the staff and counsellors.
[9] The Diocese says that the application judge failed to take these factors into account, when he held that only 12 per cent of the campers are special needs children. By definition, these are children who have one-to-one staff care, depending on the camper's needs. For example, during the 2000 camping season, there were 24 children with epilepsy out of approximately 120 campers in Session 1. This is 20 per cent of the total. Session 3 also had 20 per cent, special needs children mainly those with sickle cell anaemia. The percentage in each session, however, by necessity changes, depending on the special needs of each child.
[10] Some of the staff hired, also have special needs such as epilepsy, sickle cell anaemia and severe asthma. They stand as role models to these campers.
[11] The Diocese argues that the application judge erred in failing to find that the Camp is land used for the purpose of the care of children, pursuant to the provisions of s. 3(1), para. 11 of the [page623] Act. The court must also find that the Camp constitutes "land owned, used and occupied by a non- profit philanthropic corporation". The Camp clearly falls within that latter category. Further, the Diocese argues that the application judge erred in finding that the Camp was used only for "short-term care" and that such care did not constitute "care of children" as contemplated by the Act.
[12] The respondent, Municipal Property Assessment Corporation ("MPAC"), argues that the application judge was correct in his conclusion that the vast majority of the campers at the Camp do not fit within the special needs categories set out in the exemption provisions of subsections 3(1) (5) and (11) of the Act, wherein he concluded that the Camp was operated as a summer recreational camp for children.
[13] MPAC submits that there was no error by the application judge when he held that the "care of children" is intended to entail both a significant degree of permanence of care and that children for whom care is provided have special needs to which such care is directed. MPAC argues that the care provided is short-term only and the Camp's main purpose is to provide recreational opportunities.
[14] MPAC says that the Camp's fee schedule is competitive with other "commercial camps". Most commercial camps are, however, privately run and run for profit. That is not the case before us. MPAC further notes that the Camp's list of activities and care is similar to that of Doe Lake Camp, Columbus Bays Camp and others. What it does not say, however, is that the Canadian Girl Guides Association camp, and that of the Boy Scouts, of similar nature, is exempt from the provisions of the Act.
[15] MPAC argues that the Camp receives no grants from the Children's Aid Society or the Ministry of Social Services. The Camp is a registered charitable organization operated by a religious organization, which uses funds either donated to fund the care of special needs children or from the campers' fees, to subsidize certain children with special needs. There is nothing in the Act that says a Camp such as this must receive government funding in order to be exempt under the Act.
The Legislation
[16] The applicable provisions of the Act read as follows:
3(1) All real property in Ontario is liable to assessment and taxation, subject to the following exemptions from taxation:
Philanthropic organizations, etc. [page624]
- Land owned, used and occupied solely by a non-profit philanthropic, religious or educational seminary of learning or land leased and occupied by any of them if the land would be exempt from taxation if it was occupied by the owner. This paragraph applies only to buildings and up to 50 acres of land.
House of refuge, etc.
- Land owned, used and occupied by a non-profit philanthropic corporation for the purpose of a house of refuge, the reformation of offenders, the care of children or a similar purpose but excluding land used for the purpose of a day care centre.
[17] The Camp is a non-profit philanthropic corporation. The land is owned by the Diocese. The Diocese argues that it falls within the exemption provided in subsection 3(1)11 of the Act in that the land is owned for the purpose of ". . . the care of children or a similar purpose . . .".
The Standard of Review
[18] The Divisional Court has jurisdiction to hear this appeal pursuant to s. 46(4) of the Act. The standard of review to be applied by us is whether or not the judge's decision was "clearly wrong". This standard applies to both findings of fact and to the application of legal principles. See: Stein Estate v. Kathy K (The), 1975 146 (SCC), [1976] 2 S.C.R. 802, 62 D.L.R. (3d) 1. The question to be asked is whether the application judge applied erroneous principles that rendered the decision "clearly wrong". In addition, the judge must have acted on a wrong principle or disregarded or misinterpreted material evidence. The Supreme Court of Canada recently addressed the standard of review in Housen v. Nikolaisen, 2002 SCC 33, [2002] S.C.J. No. 31 (QL), where the court held that in pure questions of law, the appellate court is free to replace the opinion of the trial judge with its own, whereas the standard of review in findings of fact are not to be reversed unless it can establish that the judge made a palpable and overriding error. An error of mixed fact and law is subject to a more stringent standard of review.
Analysis
[19] This is a case of statutory interpretation. The modern Canadian law as to the interpretation of statutes was enunciated by Iacobucci J., for the court, in Rizzo & Rizzo Shoes Ltd. (Re), 1998 837 (SCC), [1998] 1 S.C.R. 27, 154 D.L.R. (4th) 193. At p. 41 S.C.R., Iacobucci J. referred to p. 87 of the test written by Elmer Driedger: Construction of Statutes, 2nd ed. (Toronto: Butterworths, 1983) (see now Sullivan and Driedger, Construction of Statutes, 4th ed. [page625] (Markham: Butterworths, 2002), p. 1, as best encapsulating the correct approach, recognizing that "statutory interpretation cannot be founded on the wording of legislation alone":
Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act and the intention of Parliament.
Iacobucci J. continued by referring to the Interpretation Act, R.S.O. 1990, c. I.11, s. 10, providing that every Act is "deemed to be remedial" and shall receive ". . . such fair, large and liberal construction and interpretation as will best ensure the attainment of the object of the Act according to its true intent, meaning and spirit". It is fair to say that since Rizzo, context and purpose are equal guides to statutory interpretation along with the words themselves. Bearing these principles in mind, we turn to the problem at hand.
[20] We are of the view that the application judge made an error of mixed fact and law in finding that the Camp did not fall within the exemption in the Act, as noted. The evidence before the application judge makes it clear that the children who attend the camp are "cared for", by the Camp staff, with some requiring much more care than others. The Camp can only be seasonal in nature, given its location and given the needs of the campers who attend. We were not told but infer that it is not set up for outdoor winter sports activities and does not run year-round. If the Act intended that the "care of children" be year-round or that the children must live in full-time institutions, the Act would have clearly said so. It does not. Most such camping organizations are seasonal in operation, and all would fail to be exempt, if one accepts MPAC's argument. This does not seem to be the case. While the Guide camp is exempted under a different subsection, applying to property owned by that organization specifically, it is nevertheless an important piece of context, illustrating that the legislature had no general intention of excluding institutions where there is part-time use only. Further, the legislature directed its mind to the time issue in s. 3(1)11 itself when it excluded day care centres, thereby indicating that it did not intend to exclude other less than permanent care arrangements, such as the one before us. Finally on this issue, the Act focuses on the institution and this institution cares for children on a constant basis during its season, although the children themselves change.
[21] The term "care" as used in the Act, is not defined. The Canadian Oxford Dictionary (Toronto: Oxford University Press, 1998) defines it as: [page626]
A process of looking after or providing someone or something; the provision of what is needed for health or protection (child care; health care; skin care).
[22] Webster's New World Dictionary, 2nd College ed. (New York: Simon and Schuster, 1980), among its several definitions of the word, notes the following as included in the term "care":
- charge, protection; custody [left in a friend's care]; 5. something to watch over or attend to; a responsibility.
[23] It further states that the words "care of" mean "in charge of"; and the words, "take care of" to mean have charge of or be responsible for, look after, attend to, provide for, protect against trouble. Therefore the scope of "care" can be narrow or wide, short-term or long-term, for a limited time or for forever, depending on the circumstances of the case. A camp counsellor has been held to be a person acting in the place of a parent, who cares for the child. See: M.T. (Re), 1983 4585 (ON CJ), [1983] O.J. No. 787 (QL), 36 R.F.L. (2d) 386 (Prov. Ct.).
[24] In a recent tax assessment case, Mr. Justice Ross, found that the Childreach Centre did not fall within the exemption as it was a parent resource centre providing parenting programmes, resources, information and a toy library facility to low income families. See: Childreach Centre v. Ontario (Regional Assessment Commissioner, Region No. 23) (2000), 16 M.P.L.R. (3d) 191, [2000] O.J. No. 5039 (QL) (S.C.J.), where children were not left at the centre to be cared for by the staff. The Camp clearly does not operate like that. Madam Justice Eberhard has pointed out in Percy v. Sedgley, [1998] O.J. No. 4052 (QL), 76 O.T.C. 112 (Gen. Div.), in para. 29, that when children are in residential programmes such as camp, the child is not in the care of either parent.
[25] The Divisional Court held in Buenavista on the Rideau v. Ontario (Regional Assessment Commissioner, Region No. 2) (1996), 1996 11792 (ON SC), 28 O.R. (3d) 272, 134 D.L.R. (4th) 278 (Div. Ct.), at p. 276 O.R., upheld on appeal, that the test for determining whether an exemption should be granted is whether the primary purpose of the institution comes within the words defining the exemption in the Act. The court, at p. 278 O.R., examined the meaning of the word "primary" as denoting something original or foundational, as well as denoting something of major importance. In our view the primary purpose of the Camp is the care of children in a very special educational setting. It takes "children with special needs" (physically challenged in many ways) and provides them with an environment, including having "normal" children, to teach them sufficient life skills to enable them to cope with the outside world. Similarly, the "normal" children are taught how to live together with children of special needs. [page627] This combination of the care of children with the charitable and educational purpose described in the evidence lifts this Camp out of the category of the purely recreational. Therefore, we do not agree with MPAC's contention that the primary purpose of the Camp is recreational. That not all of the children are "special needs" children is actually necessary if the Camp is to fulfill its purpose of integrating such children with "normal" children and so prepare both for the world in which they will all live. The Camp is an institution for the care of children within the meaning of that language in the Act.
[26] The words of the Act are presumed to be used in their popular sense and not a narrowly legal or technical sense: See: Xerox of Canada Ltd. and Regional Assessment Commissioner, Region No. 10 (1980), 1980 1627 (ON CA), 30 O.R. (2d) 90, 115 D.L.R. (3d) 428 (C.A.). When the statutory context is considered, the institutions to be exempted share public benefit characteristics: they are charitable and generally have educational or social benefit purposes of one sort or another. This institution shares that characteristic and nothing indicates that the plain meaning of the phrase "the care of children of similar purpose" should not be given effect. We agree with the submission of the Diocese that no contrary intention can be implied from the Act.
[27] The Supreme Court of Canada, in Buanderie centrale de Montréal Inc. v. Montreal (City); Conseil de la santé et des services sociaux de la région de Montréal métropolitain v. Montreal (City), 1994 59 (SCC), [1994] 3 S.C.R. 29, [1994] S.C.J. No. 80 (QL), File No. 23604, in paras. 25 to 27 of the Quicklaw version, held that the interpretation of tax legislation should follow the ordinary rules of interpretation, and that substance should give precedence over form to the extent that this is consistent with the wording and objective of the statute. Further, any lack of clarity with respect to the meaning of a taxing statute, which cannot be reconciled by normal rules of statutory interpretation should be resolved in favour of the taxpayer. See: Ontario Property Assessment Corp. v. Praxair Canada Inc., [2002] O.J. No. 121 (QL), 26 M.P.L.R. (3d) 262 (S.C.J.).
[28] The exemptions contained in para. 11 of s. 3 of the Act have expanded and changed over time. The Diocese says there is a common feature to the specific exemptions in the legislation over the years and it is that they are all "charitable". We find that this brings the Camp out of the purview of the for profit, privately-run recreational camp for healthy children and medically fit children. The property itself does not have to be in constant or regular use to qualify. See: Presbyterian Church in Canada v. Ontario (Regional Assessment Commissioner, Region No. 22), [1995] O.J. No. 1492 (QL), DRS 95-13344 No. 5998/94 (Gen. Div.), para. 15. [page628]
[29] We find that the application judge failed to take these facts into account in coming to his conclusion, thereby making a palpable and overriding error. Further, the application judge erred in law in misinterpreting the applicable provisions of the Statute in reaching his conclusion that the Camp did not fall within the exemption of the "care of children". The judgment of the application judge is therefore set aside, and we find that the subject lands meet the test for exemption found in subsection 3(1)11 of the Assessment Act, R.S.O. 1990, c. A.31 as amended. The appeal is therefore granted. Order to go accordingly.
[30] If the parties cannot otherwise agree on costs, we will receive brief written submissions by the parties within 30 days of this Order.
Appeal allowed.