CITATION: Municipal Property Assessment Corp. v. Bell Canada, 2024 ONSC 3670
DIVISIONAL COURT FILE NO.: 24-44
DATE: 20240703
ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
Lococo, Matheson and O’Brien JJ.
BETWEEN:
MUNICIPAL PROPERTY ASSESSMENT CORPORATION
Appellant
– and –
BELL CANADA and city of Toronto
Respondents
Melissa VanBerkum, for the Appellant
Richard R. Minster and Dan Rosman, for the Respondent Bell Canada
HEARD in Toronto: June 13, 2024, by video conference
REASONS FOR JUDGMENT
R. A. LOCOCO J.
I. Introduction
[1] The appellant Municipal Property Assessment Corporation (“MPAC”) appeals, with leave, Decision WR 181999 of the Assessment Review Board dated January 19, 2023, reported at 2023 3033 (the “Board decision”), relating to MPAC’s assessment of a telecommunications switching station in downtown Toronto owned by the respondent Bell Canada.
[2] On appeal from the assessment for the 2017 to 2022 taxation years, the Board determined the current value of the property and then reduced that amount by approximately 45 percent by way of an equity adjustment pursuant to s. 44(3)(b) of the Assessment Act, R.S.O. 1990, c. A.31. MPAC submits that the Board erred in its interpretation of s. 44(3)(b) and failed to apply the correct test or measure of equity.
[3] For the reasons below, I would dismiss the appeal.
II. Background
[4] Bell Canada owns a six-story building on Asquith Avenue in Toronto (the “Asquith property”), near the corner of Yonge and Bloor Streets. The building was constructed in 1924 to house a telecommunications switching station, serving part of central Toronto. The Asquith property continues to serve that function today. This function was historically completed by operators stationed at switchboards, but the process is now fully automated. Three of the building’s six stories house computerized switching facilities. Another floor is partially occupied by a Bell Canada subsidiary. The remaining two floors are vacant.
[5] Under s. 11(2) of the Bell Canada Act, S.C. 1987, c. 19 (the “BCA”), the approval of the Canadian-television and Telecommunications Commission (“CRTC”) would be required to sell or lease the Asquith property. Section 11(2) provides:
Approval of disposal of facilities required
(2) Except in the ordinary course of the business of the Company, no facilities of the Company that are integral and necessary for the carrying on of telecommunications activities shall be sold or otherwise disposed of, or leased or loaned, without the prior approval of the Commission.
III. Assessment regime and Board decision under appeal
[6] The Assessment Act provides for the assessment of land in Ontario for the purpose of municipal taxation. The assessment of land is based on the land’s current value: Assessment Act, s. 19(1). The “current value” of land is defined 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”: s. 1(1). As explained below, in order to determine a property’s value for purposes of assessment, the property’s current value may be adjusted downward to make its assessment equitable with that of similar lands in the vicinity (referred to as an “equity adjustment”): s. 44(3)(b).
[7] For the 2017 to 2022 taxation years, MPAC returned an assessment of the Asquith property in the amount of $33,360,000. Bell Canada appealed the assessment to the Board under s. 40 of the Assessment Act. In response, MPAC determined that the assessment was too low and filed a notice of increased assessment in the amount of $48,278,000, based on the income approach to value.[^1]
[8] To determine the amount of an assessment on appeal, s. 44(3) of the Assessment Act directs the Board to determine the property’s current value and then adjust that amount by reference to similar properties in the vicinity if the adjustment would result in reduction of the assessment. Section 44(3) provides:
(3) For 2009 and subsequent taxation years, in determining the value at which any land shall be assessed, the Board shall,
(a) determine the current value of the land; and
(b) 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.
[9] In the Board Decision, at para. 14, the Board identified the following matters to be determined on appeal, consistent with s. 44(3):
- A determination of the current value of the subject property, and in particular:
a. Approach to value (cost approach or income approach);
b. Comparable properties. [s. 44(3)(a)]
- Whether the current value determined requires a reduction for it to represent equitable assessment when reference is made to the assessments of similar lands in the vicinity. [s. 44(3)(b)]
[10] The Board also identified the following areas of agreement between the parties:
a. The highest and best use (“HABU”) of the Asquith property was its existing use as a telecommunications centre: Board decision, at para. 11. In Tyandaga Golf & Country Club and Town of Burlington, 1970 251 (ON CA), [1970] 2 O.R. 612 (C.A.), the Court of Appeal for Ontario stated that “it still is the law that the highest and best use to which the land may be put emerges as the governing element in establishing value for assessment purposes.”
b. CRTC approval would be required to sell or lease the Asquith property under s. 11(2) of the BCA, since the switching station was “integral and necessary for the carrying on of telecommunication activities”: Board decision, at para. 11.
c. The value of the building and other improvements on the Asquith property (being replacement cost new less depreciation or “RCNLD”) was $3,528,309: at paras. 39, 61.
[11] In the Board Decision, at para. 37, the Board rejected MPAC’s position that the income approach should be used to determine the property’s value. The Board found that “given the unique circumstances of the subject property, its use, location and statutory restrictions, the best approach in determining the current value of the subject property with the evidence provided by the parties, is the cost approach to value”: at para. 38.
[12] The Board, at paras. 39-40, noted that the cost approach involved determination of the property’s two component parts: the value (RCNLD) of existing improvements and the value of the land portion. The current value of the property was the sum of those two amounts.
[13] At paras. 56-58, the Board found that the current value of the Asquith property’s land portion should be determined based on time-adjusted sales of comparable properties in the vicinity, a component of the sale prices being the properties’ development potential: see paras. 41, 47. To make that determination, the Board took “a median value per square foot of permitted gross leasable area [GLA]” for comparable properties (being $145.12 per square foot) and multiplied it by the GLA of the existing building on the Asquith property (being 244,000 square feet), resulting in a current value of $35,409,280 for the land portion: Board decision, at paras. 58, 60. After adding the agreed RCNLD of existing improvements of $3,528,309, the Board found that the current value of the Asquith property for the 2017 to 2022 taxation years was $38,938,000: at paras. 61, 74.
[14] The Board, at paras. 62-64, then turned to consideration of whether a reduction in that amount was required as an equitable adjustment under s. 44(3)(b). An expert witness for each of MPAC and Bell Canada provided an Assessment to Sale Ratio (“ASR”) study, based on sales of properties in the vicinity. In each ASR study, the ratio between the assessed value and the sale price was calculated for each sale and a median amount was determined. Since those calculations were based on different properties in each ASR study, the median amount for each study was different (0.86 for Bell Canada’s study and 0.94 for MPAC’s).
[15] At paras. 63-64, the Board described the use of an ASR study as “a common means of determining whether a reduction in the current value determined is necessary and if so, by how much”, but went on to state:
However, an ASR study is not the only means of deciding whether a current value should be reduced to reflect equitable assessment. The Board has applied many different approaches in its consideration of downward adjustments to current values. To select the best approach the Board is guided by past decisions of this Board and the Courts.
[16] At para. 65, the Board went on to consider the “guidance” provided by the Divisional Court in Municipal Property Assessment Corp. v. Loblaw Properties Ltd., 2017 ONSC 1299, 62 M.P.L.R. (5th) 253 (Div. Ct.). In that decision, at para. 23, the court noted that previous case law directed consideration of “all points of comparison” when determining “what constitutes similar properties” for the purpose of s. 44(3)(b): see Trizec Equities Ltd. v. Ontario (Regional Assessment Commissioner, Region No. 27) (1988), 27 O.A.C. 203, at paras. 7, 9; Ontario (Regional Assessment Commissioner, Region No. 13) v. Downtown Oshawa Property Owners’ Assn., 1978 36 (SCC), [1978] 2 S.C.R. 1030, at p. 1036.
[17] The Board, at para. 65, reproduced the following statement in Trizec, at para. 9, which was adopted by the court in Loblaw, at para. 23:
All points of comparison must be considered. The Board must make a factual finding based on such a consideration. One point of similarity such as use may be, but is not necessarily, determinative. Some similarities may be overridden by other characteristics and some differences may be subordinated.
[18] At para. 66, the Board stated that in this case, “points of comparison of similar properties should relate, where possible, to the [Asquith] property’s” size, location, configuration, age, condition, and use. At paras. 67-69, the Board noted the Asquith property’s unusual nature, a limiting factor in identifying “similar land in the vicinity”:
[67] The subject property is a roughly 100-year-old building in downtown Toronto, six storeys in height, supporting telecommunications switching functions for the owner and other telecommunications providers, with some office space; most of which is unoccupied.
[68] In addition, the subject property is impacted by the BCA which requires the CRTC, an agency of the Government of Canada, to approve any sale of the subject property for reasons related to the “public good.”
[69] The [Assessment] Act requires the Board to have reference to the assessment of similar lands in the vicinity. Having done that, Loblaw tells us that when that reference is made it must be done so in consideration of ‘all points of comparison’.
[19] At para. 70, the Board identified another Bell Canada switching station on Simcoe Street in downtown Toronto as providing “a good point of reference when compared to the [Asquith] property” for determining the amount of the equitable adjustment to the Asquith property’s current value under s. 44(3)(b). The Board found, at paras. 70-73:
[70] One property in evidence provides a good point of reference when compared to the subject property. That property is 220 Simcoe Street (“220 Simcoe”); also located in downtown Toronto. It is owned by Bell Canada and has the same restrictions placed on it in accordance with the BCA. What makes 220 Simcoe more similar than all other properties in evidence is that it provides the same telecommunications switching function for its customers and the customers of co-locators, as the subject property does.
[71] The only difference between 220 Simcoe and the subject property is size. The land area of 220 Simcoe is 1.08 acres, or 47,343 square feet. The land area of the subject property is 35,002 square feet.
[72] The Board heard that the 2016 current value assessment of 220 Simcoe was appealed by Bell Canada and that a settlement of its assessment was reached prior to the appeal requiring adjudication before this Board. That settlement included a value attributed to the land portion of 220 Simcoe of $513.71 per square foot.
[73] The Board finds that this figure represents the best evidence at the hearing of the assessment of similar lands in the vicinity, when all points of comparison are considered. When applied to the land area of the subject property of 35,002 square feet, the result is $17,980,877. When this value is added to the agreed-to improvement value of $3,528,309 the total value determined, using the cost approach to value is $21,509,186 or $21,509,000, rounded.
[20] In conclusion, at paras. 74-76, the Board found:
a. The Asquith property’s current value was $38,938,000;
b. The current value required “a reduction for it to reflect equitable assessment, when reference is made to the assessments of similar lands in the vicinity”; and
c. Applying the equity adjustment, the determined current value was reduced to $21,509,000, a reduction of approximately 45 percent.
IV. MPAC’s appeal to Divisional Court
[21] An appeal lies from the Board to the Divisional Court, with leave, on a question of law: Assessment Act, s. 43.1(1). In the leave endorsement dated June 15, 2023 (reported at 2023 ONSC 3622), at para. 7, Nishikawa J. granted MPAC leave to appeal the Board decision in respect of the following question: “Did the Board err in its interpretation of s. 44(3)(b) [of the Assessment Act] and fail to apply the correct test or measure of equity?”
[22] By Notice of Appeal dated January 14, 2024 (amended March 26, 2024), MPAC appeals the Board decision. MPAC asks the court to set aside the Board decision and enter a judgment confirming the current value of the Asquith property at $38,938,000, with no adjustment for equity, pursuant to s. 44(3) of the Assessment Act. As an alternative remedy, MPAC asks that the matter be remitted to the Board for a rehearing on the issue of equity adjustment only.
[23] MPAC takes no issue with the Board’s finding under s. 44(3)(a) that the current value of the Asquith property is $38,938,000. That determination is not before this court on appeal, given the question set out in the leave endorsement.
V. Jurisdiction and standard of review
[24] The Divisional Court has jurisdiction to hear this appeal, but only on a question of law: Assessment Act, s. 43.1(1). Absent an extricable error of law, the Board’s findings of fact and its findings of mixed fact and law (which include the application of correct legal principles to the evidence) cannot be appealed. Extricable questions of law include legal errors involving the application of an incorrect principle, the failure to consider a required element of a legal test, or the failure to consider a relevant factor: Deslaurier Custom Cabinets Inc. v. 1728106 Ontario Inc., 2017 ONCA 293, 135 O.R. (3d) 241, at para. 19, citing Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633, at para. 53.
[25] The standard of review is correctness for questions of law, including legal principles extricable from questions of mixed fact and law: Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, at paras. 8, 34-37; Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, [2019] 4 S.C.R. 653, at para. 37.
[26] In Drewlo Holdings Inc. v. Municipal Property Assessment Corp., 2024 ONSC 786, 169 O.R. (3d) 780 (Div. Ct.), at paras. 6-7, on appeal from a Board decision under the Assessment Act, the Divisional Court summarized the standard of review as follows:
Appeals are only allowed to this court from the board on questions of law, pursuant to s. 43.1 of the Act. Questions of law examine what the correct legal test is, and questions of fact examine what took place between the parties; questions of mixed fact and law involve whether facts satisfy the legal test…. The application of a legal test to the facts, and the board’s factual findings are not subject to appellate review absent an extricable error of law….
On this statutory appeal from the decision of a tribunal, the standard of review is correctness. Accordingly, this court is free to substitute its opinion for that of the administrative decision maker…. [Citations omitted.]
[27] When the decision under appeal is fact-intensive or involves the exercise of discretion, care must be taken in identifying extricable errors of law since the process of severing out legal issues can undermine the standard of review analysis. An arguably unreasonable exercise of discretion is not an error of law or jurisdiction: Wood Buffalo (Regional Municipality) v. Alberta (Energy and Utilities Board), 2007 ABCA 192, 80 Alta. L.R. (4th) 229, at para. 8; Natural Resource Gas Limited v. Ontario (Energy Board), 2012 ONSC 3520 (Div. Ct.), at para. 8; Conserve Our Rural Environment v. Dufferin Wind Power Inc., 2013 ONSC 7307 (Div. Ct.), atpara. 13.
[28] While the court is empowered to replace a tribunal’s opinion on questions of law with its own, the correctness standard does not detract from the need to respect the tribunal’s specialized function. The tribunal’s subject matter experience and expertise relating to the requirements of its home statute should be taken into account: Reisher v. Westdale Properties, 2023 ONSC 1817 (Div. Ct.), at paras. 9-10, citing Planet Energy (Ontario) Corp. v. Ontario Energy Board, 2020 ONSC 598 (Div. Ct.), at para. 31; Vavilov, at para. 36.
VI. MPAC’s position
[29] In response to the question in the leave endorsement, MPAC submits that the Board erred in its interpretation of s. 44(3)(b) and failed to apply the correct test or measure of equity.
[30] Based on previous case law, MPAC submits that in order to determine whether (and to what extent) it is necessary to make an equity adjustment under s. 44(3)(b), the Board is required to undertake a two-step process. MPAC says that this analytical framework is consistent with the legislative purpose of s. 44(3)(b) to ensure that the municipal tax burden is distributed fairly among similarly situated owners, relative to the values of their properties, consistent with the purpose of the Assessment Act: see Re Allen and Town of Mimico, [1920] O.W.N. 150 (Co. Ct.), at p. 151; Re Empire Realty Co. Ltd. and Assessment Commissioner for Metropolitan Toronto, 1968 183 (ON CA), [1968] 2 O.R. 388, (C.A.), at p. 390; Municipal Property Assessment Corp. v. BCE Place Ltd. (2009), 98 O.R. (3d) 510 (Div. Ct.), at paras. 61, 63, varied in part, 2010 ONCA 672, 103 O.R. (3d) 520.
[31] The first step in the analytical process is to determine “similar lands in the vicinity”. Making that factual determination requires consideration of “all points of comparison”: Loblaw, at para. 23; Trizec, at paras. 7, 9.
[32] MPAC submits that the second step it to determine the relationship between the current values and the assessed values of those similar lands. Where similar properties are assessed at less than their current values, s. 44(3)(b) permits the Board to adjust the assessed value of the appealed property to be consistent with the ratio of current value to assessed values of the similar properties: Bayview Summit Development Ltd. v. Regional Assessment Commissioner, Region No. 14 (1998), 36 O.M.B.R. 161 (Div. Ct.), at p. 163, leave to appeal to C.A. refused.
[33] With respect to the first step, MPCA submits that the Board erred in its determination of “similar lands in the vicinity” by limiting its equity analysis to 220 Simcoe because it was (in the Board’s view) “more similar than all other properties in evidence” based on its use as a switching station: Board Decision, at para. 70. MPAC says that focusing on the Asquith property’s use to the exclusion of other points of comparison is contrary to the judicial direction in Trizec and Loblaw to consider all points of comparison to determine “similar lands in the vicinity”. Among other things, MPAC also argues that even if the Board was justified in focusing on use as the basis for determining similar lands, it failed to explain why it did not consider evidence of another Bell Canada switching station at 76 Adelaide Street West, which was assessed at 100 percent of its current value.
[34] With respect to the second step of the equity analysis, MPAC submits that in order to determine the relationship between the current values and the assessed values of the similar lands, the Board must have evidence of those values before making an equity adjustment, typically in the form of an ASR study setting out the ratio between the assessed value and the sale price of the similar properties. MPAC says there was no such evidence before the Board in this case.
[35] MPAC also submits that even if 220 Simcoe alone was correctly treated as “similar lands in the vicinity” within the meaning of s. 44(3)(b), there was no evidentiary foundation for making an equity adjustment based on the relationship between that property’s assessed value and its current value. There was no sale of 220 Simcoe and no evidence its current value was different from its assessed value. MPAC submits there was no evidence to justify a 45 percent equity adjustment. In calculating the Asquith property’s equity adjusted value, the Board erred, at paras. 72-73, in applying the “value attributed to the land portion of 220 Simcoe of $513.71 per square foot” to the 35,022 square foot land area of the Asquith property, which failed to take into account the difference in value between those properties based on their respective locations. According to MPAC, doing so was inconsistent with the Board’s finding in determining the Asquith property’s current value that the property’s total land value was $35,409,220, being $1,011.06 per square foot of land area, almost double the corresponding amount for 220 Simcoe.
[36] MPAC also submits that the Board erred in its finding, at para. 72, that the “value attributed to the land portion of 220 Simcoe of $513.71 per square foot” was the result of the settlement of that property’s assessment. MPAC says that the evidence before the Board relating to the settlement of an assessment related to a different Bell Canada property.
VII. Analysis and conclusion
[37] For the reasons below, I would dismiss the appeal.
The Board did not err in determining “similar lands in the vicinity”
[38] After determining the Asquith property’s current value pursuant to s. 44(3)(a), the Board was required by s. 44(3)(b) to have reference to values at which “similar lands in the vicinity” were assessed and, if appropriate with reference to similar lands in the vicinity, apply a downward adjustment to produce an equitable assessment for the Asquith property. Determining what was “similar” and what was in the “vicinity” are factual findings of the Board based on the evidence. Those findings are not subject to appeal absent an extricable error of law. I see no such error in this case.
[39] In its equity analysis, the Board correctly cited Loblaw, the leading case on the application of equity, and applied the “all points of comparison” framework: Board decision, at paras. 65-66. The Board found, as fact, that the telecommunications centre located at 220 Simcoe was similar to the Asquith property in use, location, configuration, age, condition, was subject to section 11 of the BCA, and was valued on the cost approach: Board decision, at paras 67-73.
[40] The parties agreed that the Asquith property’s highest and best use was a telecommunications centre: at para. 11. A property’s HABU “is a primary, if not determinative factor … when determining whether a candidate property is similar to the subject property”: General Motors of Canada Co. v Municipal Property Assessment Corp. Region 23, 2023 12249 (Ont. A.R.B.), at para. 211. On the evidence before the Board, the only property with the same HABU that the Board accepted as “similar” and in the “vicinity” was the 220 Simcoe telecommunications centre: at paras. 71, 73. The Board was entitled to rely primarily on one point of similarity as determinative for this purpose: Trizec, at para. 9; Loblaw, at para. 23. I see no extricable legal error in the Board’s analysis.
[41] Contrary to MPAC’s submission, I also see no legal error arising from the fact that the Board did not specifically refer to Adelaide switching station or other Bell Canada property in making that determination. There is no obligation on a tribunal to mention every piece of evidence or record every argument or aspect of the deliberation process: Quadrexx Hedge Capital Management Ltd. v. Ontario (Securities Commission), 2020 ONSC 4392, 151 O.R. (3d) 709 (Div. Ct.), at paras. 120-121.
To make an equity adjustment, the Board was not required to determine the relationship between the current value and the assessed value of similar properties
[42] As previously noted, in order to make an equity adjustment, MPAC submits that after determining similar lands in the vicinity, the Board is required as a second step to determine the relationship between the current value and the assessed value of the similar lands, typically based on an ASR study setting out the ratio between the assessed value and the sale price of the similar properties. As the Board noted, at para. 63, an ASR study is “a common means of determining whether a reduction in the current value determined is necessary and if so, by how much.”
[43] As the Board correctly stated, at para. 64, however, “an ASR study is not the only means of deciding whether a current value should be reduced to reflect equitable assessment.” Given the unusual nature of telecommunication centres (including the statutory restriction on alienation), there would be no sales data to develop an ASR study for such properties.
[44] In Municipal Property Assessment Corp. v. Schumacher, 2016 ONSC 3239, 56 M.P.L.R. (5th) 55 (Div. Ct.), MPAC unsuccessfully took the same position as on the current appeal that it is necessary to determine the relationship between the current value and the assessed value of the similar lands when making an equity adjustment.
[45] In Schumacher, the Board determined that an office building’s current value was $8,179,000 and then reduced the assessment to $6,763,000 by way of equity adjustment: Schumacher, at para. 2. The court, at para. 15, set out MPAC’s position with respect to the equity adjustment:
The Appellant [MPAC] submits that the Board incorrectly interpreted and applied s. 44(3)(b) of the Act by failing to have reference to the current value at which similar lands in the vicinity were assessed. In so doing, the Board adjusted the correct current value of the Property absent any evidence that it was inequitably assessed. The Appellant submitted that this resulted in the Property being assessed for taxes at 83% of its current value assessment, while similar lands were all assessed at 100% of their current values.
[46] The court, at para. 18, rejected that position, finding that there is no prescribed method to establish an equity reduction:
Section 44(3)(b) does not specify any particular methodology. We cannot say that at any step of the analysis, the Board erred in law or behaved unreasonably in determining the issues advanced on appeal, even though other possible determinations or methods were available to it, and urged upon us by the Appellant.
[47] MPAC submits that Schumacher is not of assistance in resolving the current appeal. MPAC says that Schumacher relates to the methodology (as opposed to the legal test) for determining whether and to what extent an equity adjustment is required. MPAC submits that the legal test is set out in s. 44(3)(b) as interpreted by the previous case law it cited, consistent with that provision’s legislative purpose of ensuring that the municipal tax burden is distributed fairly among similarly situated owners, relative to the values of their properties. MPAC argues that an ASR study is the preferred methodology to establish whether and to what extent an equity adjustment is required, but in the absence of an ASR study, other evidence is required of the relationship between the similar lands’ current value and assessed value.
[48] MPAC also submits that caution should be exercised before relying on the result in Schumacher, since the standard of review that applied to that appeal was reasonableness, consistent with the direction provided by the governing case law when that appeal was decided in 2016, including Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190: see Schumacher, at paras. 6-12. The standard of review for the current appeal is the more stringent standard of correctness, consistent with the Supreme Court’s direction in its 2019 decision in Vavilov.
[49] Addressing the latter point first, I see no merit in the suggestion that the result in Schumacher may be suspect because the reasonableness standard of review applied. Among other things, the court, at para. 18, explicitly stated that the result relating to s. 44(3)(b) would have been the same whether the standard of review was reasonableness or correctness: “We cannot say that at any step of the analysis, the Board erred in law or behaved unreasonably in determining the issues advanced on appeal” (emphasis added). I also note that MPAC seemed to have no difficulty relying on this court’s 2017 decision in Loblaw, even though the reasonableness standard of review also applied in that case.
[50] Contrary to MPAC’s submissions, I consider the approach taken by this court in Schumacher to be of assistance in determining this appeal. In Schumacher, the court did not accept the same argument that MPAC made in the current appeal, that is, that the Board improperly reduced the subject property’s current value “absent any evidence that it was inequitably assessed”. The court, at para. 18, rejected MPAC’s submissions relating to the Board’s analysis, finding that s. 44(3)(b) “does not specify any particular methodology” to determine whether there should be a reduction in assessed value.
[51] As was the case in Schumacher, I see no basis for interfering with the Board decision in the current appeal. As previously noted, the Board did not err in relying primarily on one point of similarity (being the Asquith property’s HABU as a telecommunications centre) to determine that 220 Simcoe was “similar” for purposes of s. 44(3)(b). No ASR study being available for such properties given their unusual nature, the Board did not err in using another basis for determining the equity adjustment, on the evidence before it.
[52] After taking into account 220 Simcoe’s larger land area, the Board, at paras. 71-73, determined the amount of the Asquith property’s assessment after equity adjustment by calculating the assessed value of 220 Simcoe per square foot of land and multiplying that amount by the land square footage of the Asquith property. I see no extricable legal error in that factual determination, which was not subject to appeal under s. 43.1(1). That finding was consistent with MPAC’s formulation of the legislative purpose of s. 43(1)(b) to ensure that the tax burden is distributed fairly among similarly situated owners, relative to the values of their properties, consistent with the purpose of the Assessment Act. If the Board was mistaken in stating, at para. 72, that 220 Simcoe’s assessment was the result of a settlement, it would be an unappealable factual error that, in any case, would have no effect on the outcome of the proceeding before the Board.
VIII. Disposition
[53] Did the Board err in its interpretation of s. 44(3)(b) of the Assessment Act and fail to apply the correct test or measure of equity? For the forgoing reasons, I would find that the answer to that question is no.
[54] I would dismiss the appeal, with costs payable by MPAC to Bell Canada in the agreed amount of $12,500 for the appeal and $7,500 for the leave motion, in each case all inclusive.
___________________________ Lococo J.
___________________________ Matheson J.
___________________________ O’Brien J.
Date: July 3, 2024
CITATION: Municipal Property Assessment Corp. v. Bell Canada, 2024 ONSC 3670
DIVISIONAL COURT FILE NO.: 24-44
DATE: 20240703
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Lococo, Matheson and O’Brien JJ.
BETWEEN:
MUNICIPAL PROPERTY ASSESSMENT CORPORATION
Appellant
– and –
BELL CANADA and city of Toronto
Respondents
REASONS FOR JUDGMENT
R. A. LOCOCO J.
Date: July 3, 2024
[^1] The income approach to value “is a method that uses the fair market rent, market-based expenses and capitalization rates derived from market sales to measure the future benefits to an assessed person, of an income generating property”: Board decision, at para. 21.