Canada Lands Co. CLC Ltd. (“CLC”) was successful in having the Court set aside a decision of the Alberta Municipal Government Board (the “MGB”) as to the amount of a 2003 municipal tax assessment of lands owned by CLC where the Court found that the MGB acted unreasonably in using theoretical formulae in substitution for the evidence before it on rates and expenses

Administrative law – Municipalities – Property assessment – Decisions of administrative tribunals – Municipal Government Board – Judicial review – Evidence – Standard of review – Reasonableness simpliciter

Canada Lands Co. CLC Ltd. v. Alberta (Municipal Government Board), [2006] A.J. No. 463, Alberta Court of Queen’s Bench, April 21, 2006, Marceau J.

CLC is a non-agent Crown corporation whose main responsibility is the development of surplus federal Crown lands. The lands in question in this case comprised four quarter-sections in the City of Edmonton on which the former Griesbach military base was located. The City gave the property a master tax roll number with a nil assessment and created various sub-accounts each assigned an assessment amount. A dispute arose with respect to the 2003 municipal tax assessment of lands owned by CLC. On review, the MGB found as a fact that the entire assessment was under appeal and that the assessors had failed to assess each tradeable parcel of land separately. The MGB fixed the value of the total assessment at $52,489,000 and directed that the City allocate that assessment among the individual quarter-sections so that there would be four separate accounts on the tax roll instead of a master tax roll number and sub-accounts. CLC appealed the MGB’s decision.

Using the pragmatic and functional approach outlined in Pushpanathan v. Canada (Minister of Employment and Immigration), [1998] 1 S.C.R. 982, the Court held that the appropriate standard of review with respect to the MGB’s decisions on the substantive aspect of the assessments was reasonableness.

The Court held that MGB’s assessment of the value of lands was unreasonable. The Court noted that the approach of the MGB used an assumption, unsupported by the evidence, that lands scheduled for redevelopment, with improvements nearing the end of their economic life, would attract a higher price from a developer than vacant land, which was illogical. The Court indicated that the best evidence of market value was what a purchaser would pay and persuasive evidence of that was led from expert witnesses on behalf of CLC. Further, the Court found that MGB used theoretical formulae in substitution for the overwhelming evidence on the issue of rental rates and expenses. As a result, the Court held that the MGB’s conclusion as to the amount of the assessment was unreasonable.

In the result, the decision of the MGB as to the amount of the assessment was set aside and the MGB was directed to reconsider the assessment.

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