Loblaw Properties Ltd. v. Mount Pearl (City), (2016) 379 Nfld. & P.E.I.R. 192 (NLTD(G))

• Judge: Paquette, J.
• Court: Supreme Court of Newfoundland and Labrador (Canada)
• Case Date: June 30, 2015
• Jurisdiction: Newfoundland and Labrador
• Citations: (2016), 379 Nfld. & P.E.I.R. 192 (NLTD(G))

Loblaw Prop. v. Mount Pearl (2016), 379 Nfld. & P.E.I.R. 192 (NLTD(G));

    1176 A.P.R. 192

MLB headnote and full text

Temp. Cite: [2016] Nfld. & P.E.I.R. TBEd. FE.009

Loblaw Properties Limited (appellant) v. City of Mount Pearl (respondent)

(201301G4007; 2016 NLTD(G) 30)

Indexed As: Loblaw Properties Ltd. v. Mount Pearl (City)

Newfoundland and Labrador Supreme Court

Trial Division (General)

Paquette, J.

February 11, 2016.

Summary:

Loblaw Properties Ltd. owned and occupied a large distribution warehouse in Mount Pearl. The property was assessed for the City of Mount Pearl by the Municipal Assessment Agency Inc. as having a market value of $5,454,500 for the 2013 taxation year. Loblaw appealed to the Assessment Review Commissioner maintaining that the correct valuation was $3,700,000. The property had a second floor office space and a ground floor distribution/warehouse space. Loblaw did not dispute Mount Pearl's assessment of the office space. The Commissioner upheld Mount Pearl's assessment. Loblaw appealed from the Commissioner's decision.

The Newfoundland and Labrador Supreme Court, Trial Division (General), dismissed the appeal.

Administrative Law - Topic 549

The hearing and decision - Decisions of the tribunal - Reasons for decisions - Sufficiency of - Loblaw Properties Ltd. owned and occupied a large distribution warehouse in Mount Pearl - The property was assessed for the City of Mount Pearl by the Municipal Assessment Agency Inc. as having a market value of $5,454,500 for the 2013 taxation year - The Assessment Review Commissioner upheld Mount Pearl's assessment - Loblaw appealed - Loblaw challenged the Commissioner's decision on the grounds that her reasons were inadequate in failing to explain why she rejected its evidence - The Newfoundland and Labrador Supreme Court, Trial Division (General), stated that the Commissioner's reasons were brief but they could not be said to disclose no consideration of the evidence or appropriate property valuation methodology - More fulsome reasons would have assisted Loblaw and other taxpayers in their understanding of the application of municipal tax to their property - However, adequacy of reasons was not a stand-alone basis for vacating a tribunal's decision - Instead, the reviewing court had to assess the reasons as part of an organic exercise which considered the range of outcomes arising from the evidence and the law - A contextual analysis, including the record of the appeal hearing, two valuation reports, and the range of possible outcomes, supported a finding that the sufficiency of reasons, though not comprehensively analyzing the evidence in relation to the valuation approach, did not support quashing the Commissioner's decision - See paragraphs 61 to 62.

Real Property Tax - Topic 623

Assessment - The assessor - Duties of (incl. duty of fairness) - [See Real Property Tax - Topic 3622 ].

Real Property Tax - Topic 3622

Valuation - Business property - Market value - Methods of assessment - Loblaw Properties Ltd. owned and occupied a large distribution warehouse in Mount Pearl - The property was assessed for the City of Mount Pearl by the Municipal Assessment Agency Inc. as having a market value of $5,454,500 for the 2013 taxation year - Loblaw appealed to the Assessment Review Commissioner maintaining that the correct valuation was $3,700,000 - The property had a second floor office space and a ground floor distribution/warehouse space - Loblaw did not dispute Mount Pearl's assessment of the office space - The Commissioner upheld Mount Pearl's assessment - Loblaw appealed - Loblaw challenged the Commissioner's adoption of the income approach to valuation as presented by the Assessors on the grounds that the Assessor's data failed to identify warehouse locations or lease information comprising anonymized data taken from a mass appraisal computer system - This evidence was described by the Assessors as a review of lease rates for warehouses in Mount Pearl provided in response to questionnaires sent to landlords and tenants - Loblaw claimed that it was denied the opportunity to verify the compatibility of those warehouses to the subject property - Loblaw said that because the Assessors failed to reveal the specific location of the rental information, the Commissioner acted without any evidence and in so doing committed an error of law - Loblaw further argued that the anonymized data denied it procedural fairness because it did not understand the case it had to meet - The Newfoundland and Labrador Supreme Court, Trial Division (General), stated that "The Commissioner was entitled to weigh all of the evidence and determine the evidence which she considered the best. The Commissioner explained that she rejected Loblaw's evidence as being dated. She further explained that she was satisfied that the Assessor's rental rates were applied properly. I am satisfied that the Commissioner's application of this evidence to the income approach to property valuation as explained in case law and based on generally accepted appraisal principles, does not constitute an error of law, measured by a standard of reasonableness" - The court also did not find a denial of procedural fairness in the circumstances of this case - See paragraphs 43 to 60.

Real Property Tax - Topic 5510

Valuation - Evidence and proof - Requirement of evidence to support valuation - [See Real Property Tax - Topic 3622 ].

Real Property Tax - Topic 7003

Assessment appeals - General principles - Scope of appeal or standard of review - Loblaw Properties Ltd. owned and occupied a large distribution warehouse in Mount Pearl - The property was assessed for the City of Mount Pearl by the Municipal Assessment Agency Inc. as having a market value of $5,454,500 for the 2013 taxation year - The Assessment Review Commissioner upheld Mount Pearl's assessment - Loblaw appealed - The Newfoundland and Labrador Supreme Court, Trial Division (General), stated that "I am satisfied that appeals from commissioners in this jurisdiction will not inevitably attract the presumptive reasonableness standard of review in their interpretation of the [Assessment] Act. Instead, in appropriate cases, analyzed within the framework of the principles established by Supreme Court of Canada jurisprudence post-Dunsmuir, a standard of correctness may be engaged. In the analysis which follows, I will consider the category of question arising here, in my determination of the standard of review which should apply to the review of the Commissioner's decision" - See paragraph 36.

Real Property Tax - Topic 7003

Assessment appeals - General principles - Scope of appeal or standard of review - Loblaw Properties Ltd. owned and occupied a large distribution warehouse in Mount Pearl - The property was assessed for the City of Mount Pearl by the Municipal Assessment Agency Inc. as having a market value of $5,454,500 for the 2013 taxation year - The Assessment Review Commissioner upheld Mount Pearl's assessment - Loblaw appealed - The Newfoundland and Labrador Supreme Court, Trial Division (General), considered the factors in Dunsmuir (SCC) - The court stated that "What is essentially at issue here is the Commissioner's rejection of the taxpayer's evidence in favour of that tendered by the Assessors, and her adoption of the income approach to valuation based on that evidence. Loblaw submits that the Commissioner thereby proceeded contrary to generally accepted appraisal principles. Considered within the Dunsmuir contextual analysis, I am not satisfied that this category of question, viz. the weighing of evidence, is one which attracts the standard of correctness. I accordingly find the correct standard of review on this category of question to be reasonableness" - See paragraphs 39 to 40.

Real Property Tax - Topic 7161

Assessment appeals (incl. complaints) - Applications or appeals to the courts - Appeal on a question of law - Loblaw Properties Ltd. owned and occupied a large distribution warehouse in Mount Pearl - The property was assessed for the City of Mount Pearl by the Municipal Assessment Agency Inc. as having a market value of $5,454,500 for the 2013 taxation year - The Assessment Review Commissioner upheld Mount Pearl's assessment - Loblaw appealed - The Newfoundland and Labrador Supreme Court, Trial Division (General), stated that "I am satisfied that Loblaw has advanced a question of law relating to the Commissioner's adoption of the income approach to valuation on the basis of the evidence presented at the hearing, taking into consideration generally accepted appraisal principles" - See paragraphs 42.

Real Property Tax - Topic 7224

Assessment appeals - Grounds of appeal - Error of law - Method of valuation - [See Real Property - Tax - Topic 3622 ].

Counsel:

Michael J. Crosbie, Q.C., for the appellant;

Jamie M. Smith, Q.C., for the respondent.

This appeal was heard on May 6 and 13 and June 30, 2015, at St. John's, N.L., before Paquette, J., of the Newfoundland and Labrador Supreme Court, Trial Division (General), who delivered the following decision on February 11, 2016.