Edmonton East (Capilano) Shopping Centres Limited (AEC International Inc.) v. Edmonton (City), 2012 ABQB 445

Court of Queen ’ s Bench of Alberta Citation: Edmonton East (Capilano) Shopping Centres Limited (AEC International Inc.) v. Edmonton (City), 2012 ABQB 445 Date: 20120723 Docket: 1103 13687 Registry: Edmonton Between: Edmonton East (Capilano) Shopping Centres Limited (as represented by AEC International Inc.) Applicant - and - The City of Edmonton; The Assessment Review Board of the City of Edmonton ; and the Minister of Justice and Attorney General for Alberta Respondents _______________________________________________________ Memorandum of Decision of the Honourable Mr.

Justice Peter Michalyshyn _______________________________________________________ I. Introduction [ 1 ] The Applicant, Edmonton East (Capilano) Shopping Centres Limited (as represented by AEC International Inc.) (“Capilano”), applies for leave to appeal a decision of the Composite Assessment Review Board (“CARB”).

[ 2 ] At issue are 2011 assessments of the property known as Capilano Mall and in particular the Wal-Mart store at the mall. [ 3 ] Capilano Mall was assessed in 2011 at $31,328,500. After filing its complaint of that assessment to the CARB, Capilano was informed that at the approaching CARB hearing the City would seek an increase in the assessment.

The City then filed materials seeking an increase of $45,073,000 – $13,744,500 higher than the original assessment Capilano had appealed in the first place. [ 4 ] The parties differed at the hearing before the CARB, though not so much before the Court, as to whether the City’s assessor told Capilano the new assessment would be pursued unless Capilano withdrew its complaint. I am unable to resolve the parties’ differences on this point, and attach no importance to it. [ 5 ] Before the CARB Capilano objected to what it called the City’s “new assessment”.

Before the CARB and this Court the City refers to an “increased” assessment. At no point however has the City specifically taken issue with Capilano’s view that the second assessment is “new” in that it characterized the mall as a “Power Centre” while the original assessment characterized it as a “Community Centre”. [ 6 ] Before the CARB Capilano argued the new assessment should be disregarded or given little weight. [ 7 ] The CARB increased Capilano’s assessment by $9,467,000, to $40,795,500.

It found the mall was not a Power Centre, yet was “something more than a ‘Community Centre’”. [ 8 ] Capilano seeks leave on not fewer than the following 9 grounds which raise 17 issues: (

a) Did the CARB misinterpret or ignore s. 305 of the Municipal Government Act, RSA 2000 c. M-26 ( MGA )? (

b) Does s. 305(5) of the MGA prohibit an assessor from seeking an increase in an assessment from the ARB? © Does the CARB have jurisdiction to raise an assessment on a complaint and if so: I. Do the principles of fair and reasonable notice apply?; ii. Is the assessor bound by a duty of fairness in seeking an increased assessment and if so what is the content of that duty?; and iii. What constitutes fair and reasonable notice and was that given in the within case? (

d) Did the CARB ignore or misinterpret s. 9 of AR 310/2009 in allowing an issue to come before it that was not raised in the Applicant’s complaint form, to wit: the classification of the property and the rental rate applied to Wal-Mart? (

e) Did the CARB ignore or misinterpret s. 9 of the regulation or err in prohibiting the Applicant from calling evidence in relation to the 2010 year? (

f) Did the CARB conduct an unfair hearing, or demonstrate an unsupportable preference or bias for the City?

I. as evidenced by its preliminary rulings at the outset of the hearing; and ii. by refusing to hear the Applicant’s 2010 evidence. (

g) Did the CARB ignore the valuation standard of market value as mandated by the MGA and regulations or otherwise: I. ignore relevant market evidence of net operating income; ii. confuse market data and equity data; iii. fail to consider whether the improvements added any value to the property when the evidence before it was that the highest and best use of the property was as a redevelopment site; or iv. fail to resolve the conflict between market value and equity? (

h) When an assessment approximates market value can equity nevertheless be used to increase an assessment? (

i) Did the CARB err in law or jurisdiction by failing to provide any reasons, or inadequate reasons? [ 9 ] For reasons which follow the application for leave is allowed on essentially the first three grounds advanced, although as will be seen I have re-framed these grounds to some extent. II. Statutory Scheme and Case Law [ 10 ] The application is brought pursuant to s. 470 of the Municipal Government Act , RSA 2000, c.

M-26 (the MGA ) which deals with appeals from an assessment review board such at the CARB in this case. [ 11 ] Section 470(5) of the MGA expressly sets out the right of appeal from a decision of the CARB to the Court of Queen's Bench. Leave to appeal is necessary. Leave to appeal may be granted if the judge is of the opinion that the appeal: (

a) involves a question of law or jurisdiction, (

b) raises an issue of sufficient importance to merit an appeal, and (

c) stands a reasonable chance of success. [ 12 ] This scheme came into force January 1, 2010. As noted in Edmonton (City) v. Edmonton Composite Assessment Review Board, 2012 ABQB 439 , the courts have been kept busy dealing with leave applications since that time. The within decision brings to an even dozen the known occasions on which this Court has been called on to consider such applications. [ 13 ] In Edmonton (City) v. Edmonton Composite Assessment Review Board , 2012 ABQB 439 it was noted a reading of previously-decided cases revealed certain trends.

Most obviously, leave to appeal is seldom given, at least compared to the often-high number of grounds raised. That appears to be most often the case because grounds for appeal do not raise questions of law or jurisdiction. Leave applications are denied frequently also on the basis of no reasonable chance of success. Least onerous appears to be the hurdle of showing the issue is of sufficient importance. [ 14 ] The ‘reasonable chance of success’ requirement engages the question of standard of review on questions of law or jurisdiction.

“Reasonableness” is the presumed standard of review to be applied in CARB leave applications: Alberta (Information and PrivacyCommissioner) v. Alberta Teachers' Association, 2011 SCC 61 at para. 34. [15] A high burden now also exists around the commonly-argued ground for leave to appeal based on the adequacy of a CARB’sreasons. The Alberta Teachers’ Association case, together with Newfoundland and Labrador (Treasury Board), 2011 SCC 62, settlesthe law with regard to the appropriate deference to be according a tribunal’s reasons.

If reasons are given, they are no longer open toattack on a ‘stand-alone’ basis but rather their merits become part or any challenge to the overall reasonableness of the decision at issue. [16] I note that of the 17 grounds raised by Capilano, none squarely challenge the very reasonableness of the CARB’s decision.This then makes short work of ground (

i) and leave is denied on the question whether the CARB erred in law or jurisdiction by failing toprovide any reasons, or inadequate reasons. [17] With these preliminary observations made, I will turn to the balance of the grounds for leave to appeal in the case before me. III. Grounds for Leave to Appeal [18] I will review each ground for leave to appeal through the lens of the three-part test set out in s. 470. Grounds (a), (

b) and (c) (

a) Did the CARB misinterpret or ignore s. 305 of the Municipal Government Act, RSA 2000 c. M-26 (MGA)? (

b) Does s. 305(5) of the MGA prohibit an assessor from seeking an increase in an assessment from the ARB? (

c) Does the CARB have jurisdiction to raise an assessment on a complaint and if so: i. Do the principles of fair and reasonable notice apply?; ii. Is the assessor bound by a duty of fairness in seeking an increased assessment and if so what is the content of that duty?; and iii. What constitutes fair and reasonable notice and was that given in the within case? [19] The threshold question is whether these grounds raise questions of law or of mixed law and fact. Topolniski J. in Edmonton(City) v. Alberta (City of Edmonton Composite Assessment Review Board), 2012 ABQB 171 at para. 11(

d) articulates the test asfollows: The principles governing the distinctions between a question of law and one of mixed fact and law are as described in Alberta (Worker'sCompensation Board) v. Appeals Commission, 2005 ABCA 276 , 2005 ABCA 276 paras 15 to 22: i. An incorrect statement of the legal standard, or test, or an application of incorrect factors in applying the law to the facts is anerror of law.

ii. Where there is a discretion involved in applying the law to the facts, the application of the discretion is not a question of law, but a question of mixed law and fact. iii. However, if a wrong legal principle is used in the application of the law to the facts, or in the exercise of the discretion, there is an error of law. [ 20 ] The City agrees each of the first three grounds for leave raise issues of law. [ 21 ] The next question is whether these grounds raise issues of sufficient importance to merit an appeal. [ 22 ] Ross J. at para. 42 of Associated Developers Ltd. v.

Edmonton (City) suggests that an issue may be of sufficient importance to merit an appeal if it is important for jurisprudential purposes. The importance must be determined on an objective scale, not the subjective importance of the matter to the applicant. Generally there should be something unsettled about the question, or the decision should have wide ranging implications.

The issues should not be merely the correction of a situation fact specific to the one case, without more. [ 23 ] As noted above, in the decided cases to date this requirement appears to be the least onerous to overcome. [ 24 ] The City “makes no submission” whether these grounds meet the test for leave to appeal. I take that as a concession they do. In any event, that is certainly Capilano’s position and I agree. [ 25 ] The final question is whether these grounds stand a reasonable chance of success on appeal.

Against the standard of review is reasonableness. [ 26 ] Here the City argues these grounds stand no reasonable chance of success on appeal. [ 27 ] The questions are then whether Capilano has a reasonable chance of success in arguing the CARB erred when dealing with ss. 305 and 305(5) of the MGA . These grounds also raise the CARB’s very jurisdiction to increase an assessment.

And further, while perhaps not perfectly articulated in Capilano’s materials, I find these grounds raise the question whether, before the CARB, the City can be a de facto appellant from its own assessment and/or / de facto applicant for a new assessment. [ 28 ] The first two grounds are inextricably linked: (

a) Did the CARB misinterpret or ignore s. 305 of the Municipal Government Act, RSA 2000 c. M-26 ( MGA )? (

b) Does s. 305(5) of the MGA prohibit an assessor from seeking an increase in an assessment from the ARB? [ 29 ] The relevant parts of s. 305 of the MGA state: Correction of roll 305(1) If it is discovered that there is an error, omission or mis-description in any of the information shown on the assessment roll,

(

a) the assessor may correct the assessment roll for the current year only, and (

b) on correcting the roll, an amended assessment notice must be prepared and sent to the assessed person.

(2) If it is discovered that no assessment has been prepared for a property and the property is not listed in

section 298, an assessment for the current year only must be prepared and an assessment notice must be prepared and sent to the assessed person.

(3) If exempt property becomes taxable or taxable property becomes exempt under

section 368, the assessment roll must be corrected and an amended assessment notice must be prepared and sent to the assessed person.

(4) The date of every entry made on the assessment roll under this

section or

section 477 or 517 must be shown on the roll.

(5) If a complaint has been made under

section 460 or 488 about an assessed property, the assessor must not correct or change the assessment roll in respect of that property until a decision of an assessment review board or the Municipal Government Board, as the case may be, has been rendered or the complaint has been withdrawn. [ 30 ] The CARB said nothing in its reasons about s. 305 generally or s. 305(5) specifically. [ 31 ] The City argues that is no surprise in that Capilano conceded s. 305(5) was not directly in play. [ 32 ] Capilano acknowledges the assessor had not directly ‘corrected or changed’ the assessment roll as those words are used in s. 305(5).

This came in Capilano’s filed materials before the CARB. The submission notes the assessor had not actually changed the roll, thus s. 305(5) is not directly engaged. [ 33 ] The grounds however raise a broader question.

Capilano’s submission to the CARB, read as a whole, frames that question as follows: While the assessor has not actual [sic] changed the roll - so MGA Section 305(5) does not directly engage, what the assessor is asking the Board to do is to circumvent the intent of the legislation and do for the assessor what he is prohibited from doing himself - implementing a new assessment, on a new basis, for which no review or appeal is provided. [ 34 ] The City argues Capilano conceded s. 305(5) was both not directly in play and irrelevant . [ 35 ] I do not agree that Capilano conceded relevance.

This becomes a consideration on re-framing the grounds for appeal, about which more in what follows. (

c) Does the CARB have jurisdiction to raise an assessment on a complaint and if so: i. Do the principles of fair and reasonable notice apply?; ii. Is the assessor bound by a duty of fairness in seeking an increased assessment and if so what is the content of that duty?; and

iii. What constitutes fair and reasonable notice and was that given in the within case? [ 36 ] The operative MGA provision states: Decisions of assessment review board 467(1) An assessment review board may, with respect to any matter referred to in section 460(5), make a change to an assessment roll or tax roll or decide that no change is required. [ 37 ] There is authority that “change to an assessment” includes both reductions and increases to the assessment: Ag Pro Grain Management Services Ltd. v.

Lacombe (County of) , 2006 ABQB 351 , and Municipal Government Board ( “MGB ”) decisions referred to therein. [ 38 ] Again, the City says Capilano’s agent clearly conceded the threshold point that a CARB can change an assessment either by way of a reduction or an increase. [ 39 ] However, just what did Capilano concede? The transcript of the hearing reveals that Capilano’s agent conceded the CARB can lower or indeed raise assessments.

That concession was made however in the context of errors or mistakes, for example if the City misses an improvement or a lease rate needs to be higher. [ 40 ] Indeed, before the CARB counsel for the City gave another example: what if on assessment of a 100,000 square foot property a pro forma shows only 1,000 square feet? Some property owner that is nefarious, in order for that never to be corrected, could very well file a complaint. If [Capilano] is correct that there is no jurisdiction to increase the assessment on the part of this Board, the City would therefore have no remedy.

We would be under-assessing by 99,000 square feet. The Board couldn’t increase that from 1,000 to 100,000 square feet. [ 41 ] This is a colourful example, but not of much help. First, no one suggests Capilano is a “nefarious” property owner. Second, and more important, there is little if any evidence the City’s new assessment came about as a result of an error. [ 42 ] Capilano did not concede unconditionally that the CARB could increase an assessment. [ 43 ] Capilano specifically argued before the CARB that the City’s original assessment was not based on an error or mistake.

It argued the City was well aware that Wal-Mart had notionally separated from the rest of Capilano Mall by walling-off the mall access to the store. It did so in 2006. The City conducted assessments based on that state of affairs right up to 2011. Those assessments characterized Capilano Mall consistently as a community centre. [ 44 ] The City’s assessor acknowledged the City had been aware “for a few years” that the Wal-Mart was walled off.

The assessor could not say if the City was aware of that all the way back to 2006. [ 45 ] At no point before the CARB did counsel for the City argue the original 2011 assessment, or for that matter prior years’ assessments, were in error or mistaken. Counsel simply stated that “...this is the first year that the City has decided to look at [the walled- off status] in terms of an increase to the Wal-Mart area”.

[ 46 ] It is not quite correct to say 2011 was the “first year” the City decided to adopt the new approach. Of course the City’s original 2011 assessment had been in line with previous approaches. It was only after that original assessment, and Capilano’s complaint about it, that for the first time the City decided to alter its approach.

It did so by looking at the Wal-Mart’s walled-off status vis-a-vis the rest of the mall, concluded the mall was in fact a “Super Centre”, then produced a new assessment almost $14 million higher than the original. [ 47 ] It is evident the CARB was aware it was dealing with a new assessment. At one point a member of the CARB asked: Q: ... but why the sudden shift from – as you mentioned there, the City was aware of this situation already; i.e. community centre/power centre.

I guess I find it hard all of a sudden to shift horses in midstream, especially – especially after an assessment order has gone out saying I’m going to hit you at 31 million – I’m just using round numbers here. But geez, now we have decided instead of calling you a workhorse, we’re going to call you a racehorse, therefore your value is now 45 million? [ 48 ] At the end of the day, Capilano conceded “change” in the context of errors or mistakes to an original assessment.

It did not concede that change included an increase based on an entirely new assessment. [ 49 ] Fundamentally, Capilano argues the CARB was not asked to change the original assessment because for all intents and purposes the City had abandoned it in favour of its new assessment. Capilano argues the CARB allowed the City to become a de facto appellant against its own original assessment. And it allowed the City to become a de facto applicant in favour of its new assessment.

In either event, Capilano effectively became the respondent to the City’s appeal of the original assessment, and of the City’s application for a new assessment. [ 50 ] As noted, at no point before the CARB or the Court has the City specifically taken issue with Capilano’s repeated complaints it faced a “new assessment”. The City rather argued it was permitted to seek pretty much any assessment it wished.

Any alleged unfairness to the taxpayer could be remedied by an adjournment. [ 51 ] Capilano on the other hand argued before the CARB that the offer of an adjournment glossed over the more deeply-rooted issue that the City’s new assessment, if allowed, would nullify the entire legislative process of assessments and complaints. This prejudiced the property owner. For the City, it simply needed to decide how it wished to assess the property owner for the year in question. The City could well have originally assessed Capilano Mall in 2011 as a Super Centre. It did not.

Having made that election, the City was not entitled to have second thoughts. Nor was it entitled to give effect to those second thoughts by high-jacking Capilano’s complaint by abandoning the assessment complained of and introducing a new one. The role of the City [ 52 ] As noted, I find these grounds raise the question whether, before the CARB, the City can be a de facto appellant from its own assessment/ de facto applicant for a new assessment. [ 53 ] In the recent decision of Canadian Natural Resources Ltd. v.

Wood Buffalo (Regional Municipality), 2012 ABQB 177 ( “Wood Buffalo ” ) Sulyma J. held a municipality cannot itself seek an increase to an assessment complained of by a taxpayer to the CARB: ... I do not think that the Municipality can seek a further increase in the assessment amount before the CARB. While I agree that the word “change” in s. 467(1) of the MGA implies both an upward and a downward adjustment, s. 460(3) expressly provides that only a taxpayer or an assessed person is entitled to make a complaint to the CARB. A complaint belongs to the taxpayer, not the Municipality.

It gives the taxpayer an opportunity to demonstrate what the correct number should be: CARB 007-2010/P at 9. The Municipality cannot then come in and ask the CARB to change the assessment to an altogether different number; it can only defend the assessed amount as correct. This reading of the legislation addresses concerns expressed by Rothman J. In Les Immeubles BP Ltee v Ville D ’Anjou et al (1978), 4 MPLR 1 (Que SC) at para 21 : I find it very difficult to conceive that the Legislature, in providing a procedure of review in favour of dissatisfied ratepayers, would have

intended that these ratepayers could find themselves penalized for having exercised their rights by having to face a decision of [increasing the assessment] and in respect to which the municipalities might not even have a right to complain had the ratepayers not filed complaints. [ 54 ] Wood Buffalo was decided after the CARB decision in question, and after the hearing of the within leave application. I have no doubt however that counsel for the parties are well aware of the decision. They are all experienced in s. 470 MGA /CARB leave-to- appeal litigation.

Indeed, counsel for Capilano was counsel in the Wood Buffalo case. [ 55 ] Wood Buffalo strengthens Capilano’s cause for leave to appeal. In saying this, I am mindful of the Municipal Government Board decisions argued before me, as summarized and applied by Clark J. in Ag Pro Grain Management Services Ltd. v. Lacombe (County of) , 2006 ABQB 351 . [ 56 ] I am directed particularly to paragraph 29 of Ag Pro .

I do not read that paragraph, or the decision in general, however as grappling head-on with the objection raised by Sulyma J. as to the municipality’s involvement in Wood Buffalo , or for that matter the similar objections as I find them framed in the context of the Capilano hearing. [ 57 ] Ag Pro does not appear to have been considered in Wood Buffalo .

Nor on the other hand does Ag Pro appear to have been considered at all on the question of a municipality’s role as a de facto appellant/ de facto applicant, whether with a new assessment or otherwise. [ 58 ] I should note that Ag Pro is considered in Edmonton (City) v. Alberta (City of Edmonton Composite Assessment Review Board) , 2012 ABQB 171 per Topolniski J. It was a case in which the City expressed discontent that a CARB, on its own motion, employed a formula proposed by neither of the parties to lower an assessment.

While the CARB’s ability to change an assessment was acknowledged – it may not have been an issue between the parties – the impugned change in that case was not brought about by the City. [ 59 ] I do not find that Topolniski J.’s decision helps resolve the arguable conflict that I see as between Wood Buffalo on the one hand, and Ag Pro and the MGA decisions on the other. Conclusion on grounds (a), (

b) and (c) [ 60 ] On the basis of a reasonable chance of success on appeal, I give leave to appeal on the question of whether the CARB was entitled to proceed on a new assessment which, on the facts as I understand them, supplanted the original assessment which was the subject of Capilano’s complaint. Inherent in this question is whether these circumstances are a “change” as contemplated in the legislation. This does not question the CARB’s ability ever to increase assessments. Nor does it raise what procedural fairness issues may arise if the CARB is entitled to proceed. [ 61 ] Grounds (

a) and (b), which indirectly raise s. 305 /305(5) of the MGA , are relevant to the question on which I have given leave to appeal. [ 62 ] I give leave also on what I find arises regarding the role of the City in the proceedings before the CARB. Can the City be a de facto appellant/ de facto applicant? Can it ever? Can it only when it alleges an error or mistake to an existing assessment, but not in the circumstances that exist before me? Wood Buffalo appears to be authority that a municipality can play no such role. Ag Pro suggests otherwise. [ 63 ] There is an obvious conflict here in the cases.

I am unable to resolve the conflict in the cases, certainly in the context of a leave application. I am therefore drawn to the conclusion there is a reasonable chance of success of this issue on appeal. [ 64 ] I appreciate I have framed the issues for leave somewhat differently from the way they are expressed by the applicant. On the whole this ‘re-framing’ accords with my understanding of the factual underpinnings and arguments made before the CARB, does not

raise new issues or trigger fresh defects, and as such is within my inherent jurisdiction: Wood Buffalo, at para. 106. [ 65 ] However, the parties are certainly free to make further submissions regarding how more precisely this or these grounds for appeal may be expressed to give effect to my decision. The balance of ground (c) [ 66 ] I will not deal with the alternatives laid out in ground (

c) outlined above. These raise questions of procedural fairness around the timing of the City’s new assessment. Arguably they arise only if it is decided the CARB has jurisdiction to increase the assessment on the City’s application in the circumstances as they exist here. [ 67 ] More fundamentally, it is hard to see just what is being appealed. Before the CARB Capilano argued inadequate notice but mooted what might be proper notice if the City was entitled to the rights it asserted, and if the CARB was obliged to decide the complaint based on the City’s new assessment.

Capilano did not ask the CARB to determine the nature or extent of notice or other duties of fairness. As noted by the City, at no time did Capilano seek an adjournment, either before or at the hearing. Indeed, Capilano’s agent called the City’s offer of an adjournment at the hearing a “meaningless offer”. Its agent stated: It’s a nice, but a meaningless offer on the part of Mr. Ashmore. The assessment wasn’t done on the basis that it was a power centre, and to say okay, Mr.

Hall, we’ll give you an adjournment to redo it, well, no, the way the system works is you do the assessment, you get 60 days to review it and appeal it and – I appreciate the gesture, but it’s a meaningless gesture as this point. [ 68 ] I find that Capilano, for its own reasons, elected not to raise for decision the issues in grounds (c) (i-iii) for which it now seeks leave to appeal. In effect, there is nothing to appeal, and I cannot direct a reference. Leave is therefore refused on the basis of no reasonable chance of success on appeal. Ground (d) (

d) Did the CARB ignore or misinterpret s. 9 of AR 310/2009 in allowing an issue to come before it that was not raised in the Applicant’s complaint form, to wit: the classification of the property and the rental rate applied to Wal-Mart? [ 69 ] This ground for leave is related to the first three. I agree with the City’s position that what was raised or not raised in Capilano’s complaint form is clearly a question of mixed law and fact, and not subject to appeal: Edmonton (City) v. Alberta (City of Edmonton Composite Assessment Review Board) , 2012 ABQB 171 at para. 11 (d). How to understand what Capilano raised in the form requires an examination of it and an

interpretation of the words used. This clearly gives rise to considerations of both law and fact. Grounds (

e) and (f ) (

e) Did the CARB ignore or misinterpret s. 9 of the regulation or err in prohibiting the Applicant from calling evidence in relation to the 2010 year? (

f) Did the CARB conduct an unfair hearing, or demonstrate an unsupportable preference or bias for the City i. as evidenced by its preliminary rulings at the outset of the hearing; and

ii. by refusing to hear the Applicant’s 2010 evidence? [ 70 ] As to ground (e), the CARB was required to ensure compliance with s. 9(3) of the Regulation by considering evidence regarding what was or was not produced pursuant to ss. 294 and 295 of the MGA . Capilano argues the CARB erred by finding no time constraint on the City’s demand for information. On the other hand the City argues persuasively that it asked for 2010 information for purposes of preparing a 2011 assessment; it was the 2010 information the CARB found had not been disclosed, and therefore could not be produced at the hearing.

Finally, the City agreed to adjourn to enable Capilano to show it had disclosed the information. Capilano sought no adjournment. [ 71 ] Regarding grounds (f)(

i) and (ii), Capilano first alleges the CARB showed an “unsupportable preference or bias” for the City. As noted by counsel for the CARB, the allegation is raised, but not pursued. In fact no basis exists for the allegations. Such allegations are serious and unfounded. They should not have appeared in the brief. Once made, they should have been withdrawn at the latest at the leave application. [ 72 ] Leave to appeal is declined on grounds (

e) and (

f) as each raises a question of mixed law and fact relating to s. 9 of the Regulation and the CARB’s handling of certain evidentiary issues. Much of what Capilano complains of here goes to the sufficiency of the CARB’s reasons, for which leave cannot be given. What’s more, neither ground (

e) nor (

f) raise issues of sufficient importance to merit leave to appeal. [ 73 ] Moving off the bias allegation, Capilano faults the CARB for not holding the City to compliance with s. 8 of the Regulation governing disclosure. Again this is a question of mixed law and fact, is an attack on the CARB’s reasons, and in any event is of insufficient importance. [ 74 ] Further, Capilano faults the CARB for failing to permit new evidence in answer to the City’s new assessment. This submission flies in the face of Capilano’s principled approach that the new assessment should be disregarded or given little weight.

Based on that approach, Capilano sought no adjournment to adduce new evidence. In any event, how the CARB dealt with Capilano’s requests to adduce evidence at the hearing, in the absence of an adjournment request, does not raise an issue of sufficient importance to merit leave to appeal. [ 75 ] Finally, Capilano complains of the short notice it was provided of the City’s intentions regarding the new assessment. This is a variation of a theme already dealt with and will not be considered again. It is perhaps symptomatic of a leave application with 17 issues. Grounds (

g) and (h) (

g) Did the CARB ignore the valuation standard of market value as mandated by the MGA and Regulations or otherwise: i. ignore relevant market evidence of net operating income; ii. confuse market data and equity data; iii. fail to consider whether the improvements added any value to the property when the evidence before it was that the highest and best use of the property was as a redevelopment site; or iv. fail to resolve the conflict between market value and equity? (

h) When an assessment approximates market value can equity nevertheless be used to increase an assessment?

[76] With regard to the first three elements of ground (g), I agree with the City’s submission that these are clearly questions ofmixed law and fact, and are of insufficient importance to merit leave to appeal. [77] On the other hand, the City concedes ground (g)(iv) and ground (

h) raise questions of law. As before, the City also “makes nosubmissions” whether these grounds raise questions of sufficient importance. Capilano says they do raise such questions, and I agree. [78] The real issue then is reasonable chance of success on appeal and despite the very broad framing of grounds (g)(iv) and (h),the real question is whether the CARB found that but for “equity” considerations it would have sustained the City’s original assessment. [79] The CARB’s reasons defy such an

interpretation and as such I find there is no reasonable chance of success on appeal. [80] Capilano focuses on two paragraphs from the CARB’s decision: 3. ... The Board is persuaded that the applied market rent to the subject Wal-Mart should be $10.50 per square foot. The Board findsthat it would be inequitable to apply a market rent of $3.50 per square foot to the Wal-Mart at the subject property while other Wall-Marts have an applied market rent of either $10.50 or $11.50 per square foot.” 6.

The Board notes that the NO (net operating income) at the time of sale in February 2007 was $2,570.524 with a vacancy of4.39%, while the NO as at July 1, 2010, using the original market rent of $3.50 per square foot, was nearly the same at $2,519,251(excluding Safeway). This supports the City’s original assessment before equity considerations for the Wal-Mart space. [81] The CARB makes no finding that in its view the City’s original assessment “approximates” market value and is thereforecorrect. It merely observes that the analysis in paragraph 6 of its reasons is “some support” for the original assessment.

The phrase“some support” is equivocal. It suggests that the paragraph 6 analysis is but a factor in a correct assessment. In cannot reasonably be readto conclude that “equity considerations” alone drove the assessment to $40,795,500. I agree with the City’s submission that these words“must be read in context with the remainder of the reasons which talk about the physical alterations and renovations and additions to theproperty.” [82] Similarly, paragraph 3 of the CARB’s decision cannot be read in isolation.

The “inequity” commented on between theCapilano Wal-Mart’s $3.50 and other Wal-Marts’ $10.50 to $11.50 per square foot again cannot be reasonably read to conclude that“equity considerations” without more drove the assessment increase. [83] Capilano refers to Strathcona No. 20 (County) v. Alberta (Assessment Appeal Board), 1995 ABCA 165 , [1995]A.J. No. 369 (C.A.) which adopts the following comment from Bramalea Ltd. v.

British Columbia (Assessor of Area #09-Vancouver), (BCCA): So the Act, read in light of the general law, requires, except where otherwise clearly stated, that assessments be both at ‘actual value’ andalso equitable as between taxpayers. [84] I am unable to read the CARB’s reasons as deciding anything contrary to this admonition in Bramalea.

I agree with the City’ssubmission that the CARB decided on the whole “that their final decision both correctly reflected market value and was equitable withother properties.” As such, I am unable to agree there is a reasonable chance of success on appeal on these grounds. [85] The rest of Capilano’s arguments in support of these grounds of appeal are an attack on the CARB’s fact findings and reasons.

IV. Conclusion [ 86 ] The Applicant's application for leave to appeal is granted on the first set of three grounds only. [ 87 ] As to costs, Capilano achieved success on three grounds but failed on six others and on 14 issues overall. What’s more, Capilano improperly alleged bias. This said, if the parties cannot agree, I will hear submissions as to costs. Heard on the 11 th day of January, 2012. Dated at the City of Edmonton, Alberta this 20 th day of July, 2012. Peter Michalyshyn J.C.Q.B.A. Appearances: Gilbert J. Ludwig for the Applicant Cameron J. Ashmore for the Respondent - City of Edmonton Kate L. Hurlburt and Darin S. McKinley for the Composite Assessment Review Board