Philip L. Sanford

The appellants appealed a decision of the Assessment Review Board regarding the property tax assessments of six large office complexes.

The Board had accepted the respondents' argument that the statutory definition of 'current value' as 'fee simple, if unencumbered' required the properties to be valued as if vacant, ignoring existing leases.

The Divisional Court allowed the appeal, holding that the Board's interpretation was wrong in law.

The Court found that the entire ownership interest, including both the landlord's and tenants' interests, must be valued, and that the 1997 amendment to the Assessment Act was intended to ensure consistency in valuation by requiring the use of market rents rather than actual rents.

The Municipal Property Assessment Corporation and the City of Toronto appealed a decision of the Assessment Review Board regarding the property tax assessments of six large office complexes in Toronto.

The Board had accepted the property owners' argument that the statutory phrase 'fee simple, if unencumbered' required the properties to be valued as if they were vacant, ignoring existing leases.

The Divisional Court allowed the appeal, finding that the Board's interpretation was wrong in law.

The Court held that the whole of the land must be assessed, and in the context of income-producing properties, 'fee simple, if unencumbered' means value calculated using market rents rather than actual rents, ensuring all interests in the land are valued.