Calgary (City) v 801 Seventh Inc, 2021 ABQB 814

Court of Queen’s Bench of Alberta Citation: Calgary (City) v 801 Seventh Inc, 2021 ABQB 814 Date: 20211013 Docket: 1601 16787 Registry: Calgary Between: The City of Calgary Applicant - and - 801 Seventh Inc., BCIMC Realty Corporation, the Cadillac Fairview Corporation/La Corporation Cadillac Fairview Limitee (each as Represented by Altus Group Limited) and the Assessment Review Board for the City of Calgary Respondents _______________________________________________________ Reasons for Decision of the Honourable Mr. Justice M.

David Gates _______________________________________________________ Introduction and Overview [ 1 ] The City of Calgary (“the Applicant”) seeks leave to appeal two decisions of the Calgary Composite Assessment Review Board (“the CARB” or “the Board”) issued on December 1, 2016, in relation to two properties: a) 801-7 th Avenue SW (“the 801 Property”) – CARB 101898P-2016; b) 635-8 th Avenue SW (“the CF Property”) – CARB 102612P-2016. [ 2 ] The Board reduced the assessed value of both properties on the basis of a change in the typical vacancy rate.

This led to a 2.64% decrease in the value of the CF Property, and a 2.4% reduction in the assessed value of the 801 Property.

[ 3 ] The Applicant seeks leave to appeal the Board’s decision to exclude the Calgary Courts Centre and the Calgary Municipal Building from the vacancy study of the subject properties. As such, the Applicant maintains that the Board erred in law in that it relied on irrelevant considerations without reference to the terms of its governing statute, the Municipal Government Act , RSA 2000, c M-26 (“ MGA ”), and associated regulations.

The Applicant further contends that Board breached the principles of natural justice and procedural fairness, and that the Board’s errors are of sufficient importance to warrant leave to appeal. [ 4 ] Both parties submitted written briefs and made oral submissions during the hearing held on June 23, 2021. In addition, counsel for the CARB submitted a short, written brief and made submissions on the jurisdiction and procedures of the CARB pursuant to the MGA , and the regulations enacted thereunder.

He also made submissions on the appropriate standard of review, but took no position on the specific issues raised by the Applicant. [ 5 ] This application was heard by me on June 23, 2021. At the conclusion of oral submissions, I advised the parties that the application for leave to appeal was dismissed with brief written reasons to follow. These are my reasons for decision. Facts [ 6 ] The two properties at issue in this application were, together with a third downtown office property, the subject of assessment complaints in 2016.

The third property, not the subject of the within application, is located at 809-6 th Street SW. All three properties are located in the downtown economic zone and are characterized as “A” quality office buildings. The assessment of each property was undertaken on the basis of an income approach to valuation that estimates the market value of the property based on the capitalized income of similar properties. [ 7 ] In 2016, the Applicant assessed the 801 Property at $290,150,000 and the CF Property at $121,760,000.

Upon receipt of their 2016 tax assessments, the Respondents brought complaints before the Board under

section 460 of the MGA . The Respondents specifically alleged that the Applicant incorrectly included the government owned and occupied Calgary Courts Centre and the City of Calgary Municipal Building in its vacancy analysis. The Respondents maintained that these two properties were not appropriate comparables given that neither compete with privately-owned office properties. [ 8 ] Municipal property tax assessments are subject to

Part 9 of the MGA and the corresponding regulations, Matters Relating to Assessment and Taxation Regulations (“ MRAT ”) . Section 293(1) of the MGA directs the process to be followed in the preparation of property assessments: 293(1) In preparing an assessment, the assessor must, in a fair and equitable manner,

a) apply the valuation and other standards set out in the regulations, and

b) follow the procedures set out in the regulations.

(2) If there are no procedures set out in the regulations for preparing assessments, the assessor must take into consideration assessments of similar properties in the same municipality in which that property is being assessed is located. [ 9 ] In the City’s Assessment Information Package – 2016 , the Applicant City described the income approach used to determine the market value of properties under the mass appraisal approach in the following terms: To determine the market value of properties like the Subject Properties under the mass appraisal method, the City uses the income approach.

This involves the application of typical income parameters such as market rent, operating costs, and vacancy rates to calculate an assessed net operating income (“NOI”) for a particular property. The assessed NOI is then divided by an assessed capitalization rate. In this way, assessment for individual properties are not calculated using the actual income data obtained from those properties.

Instead, assessment for all properties are prepared using typical income parameters derived from the mass appraisal model: Respondent’s Brief, at para 11. [ 10 ] Typical market rental and vacancy rates form the basis of valuation, as opposed to actual subject-specific rents and vacancy rates. To determine typical rates, the City considers market activity of similar properties over a period of time before the valuation date. It compiles that data to come up with a typical rate.

These typical rates are then input as parameters into a number of equations that ultimately yield the assessed value. [ 11 ] The three complainants challenged the parameters of the income approach. All three complainants were represented by Altus Group Limited, a tax agent, who advanced virtually identical arguments before the Board. In all three instances, it was alleged that the office space rate should be reduced, and the vacancy and capitalization rates should be increased for the properties. In the result, the content of each of the three decision was very similar.

Ultimately, the Board altered the typical vacancy rate but confirmed the other challenged parameters of the assessment. [ 12 ] The complainants urged the Board to exclude the Calgary Courts Centre and the Calgary Municipal Building from the group of properties used to determine the typical office vacancy rate.

They maintained that these two properties did not compete with privately- owned office properties and, as such, should not be included in the vacancy analysis. [ 13 ] As set out at para 3 of the Board’s decision, the Board was required to address three issues regarding the 2016 tax assessments of the two properties. The evidence and argument before the Board focused on the same three issues: (

i) The most appropriate capitalization rate for the property; (ii) The appropriate lease rate for office space;

(iii) Should vacancy be increased to reflect buildings not available on the market. [ 14 ] The complainants asked the Board to increase the capitalization rate, decrease the typical office rental rate and adjust the typical vacancy rate by removing the two previously mentioned properties from the study used to derive the rate. [ 15 ] In its’ decisions reached on December 1, 2016, the Board excluded the Calgary Court Centre and the Calgary Municipal Building from the typical vacancy study but did not accept any of the other requested changes.

In the result, the Board reduced the assessed value of each of the subject properties. [ 16 ] In its reasons, the Board held (at para 26): The Board does accept that some properties should not be included in the Respondent’s studies. In this case it is the Calgary Courts Centre and the Municipal Building. These properties are both owned by a level of government. They are solely occupied by unique and specific government process. The Board does not accept that there is a “reasonable expectation” that the office space in these two buildings would be available on the open market even if it was vacant.

The concept of seeing space on the open market behind the security of the Court Centre is not accepted by the Board. The Respondent’s argument that this could become available at some time in the future speaks to a speculative assessment. [ 17 ] Further, the Board rejected the Applicant’s reliance on other properties owned or occupied by a level of government as valid comparables, holding, at para. 27: In addition the comparison to other properties owned or occupied by a level of government does not support the inclusion of these properties in the typical vacancy study.

The other properties, such as the Harry Hays building, had a reasonable expectation that if space was available, it could be leased on the open market. The same could be said for the Respondent’s effort to equate this item to all owner- occupied properties in the municipality. The Board also notes the vacancy issue was dealt with for C quality property in CARB 99414 P – 2016. [ 18 ] At para 28 of their reasons, the Board held that a very small group of properties would qualify for exclusion from the vacancy study.

The Board then proceeded to outline the criteria that it had considered and applied in reaching the conclusion that the Calgary Courts Centre and the Calgary Municipal Building should be excluded from the vacancy study. In order to qualify for the exclusion from the study the Board finds that a property would have to meet certain criteria.

a) it would have to be wholly owned by a level of government,

b) it would have to serve a specific and unique purpose,

c) it would have to be fully occupied by one or more levels of government dedicated to the purpose outlined in 21(b), and

d) it would have to be a reasonable expectation that any available office space would not be advertised on the open market. [ 19 ] The Board went on to find that these two properties should be included in the various studies if it had been demonstrated that “these properties had, or could have, publicly available office space”: at para 29. The Applicant says that the Board reached this conclusion by applying a test for whether a property should be excluded from a vacancy study. The Law – Leave to Appeal [ 20 ] Pursuant to section 470(5) of the MGA , as it read at the time the application was filed in December 2016, leave to appeal may be granted if the following conditions are met:

i) The appeal involves a question of law or jurisdiction; ii) The question of law or jurisdiction is of sufficient importance to merit an appeal; and iii) The appeal has a reasonable chance of success. [ 21 ] The onus rests on an applicant to establish that all three parts of this test have been met. [ 22 ] In Associated Developers Ltd v Edmonton (City ), 2011 ABQB 592 , at para 6 , Ross J found that at the leave to appeal stage of the process, an applicant need only show that the decision maker may have made an error in law or jurisdiction.

Question of law or jurisdiction [ 23 ] In Canadian Natural Resources Ltd v Wood Buffalo (Regional Municipality) , 2012 ABQB 177 , Sulyma J held (at para 9) that: An appeal is available only on questions of pure law and jurisdiction. If the question is one of fact, or even mixed fact or law, the analysis ends and an application for leave must fail. The rule is strict.

Where a question of mixed fact and law is involved, leave to appeal may only be granted if a pure legal question can be extricated: TransCanada Keystone Pipeline Limited Partnership , at para 6; see also Pembina Institute for Appropriate Development v Alberta (Energy Resources Conservation Board) , 2009 ABCA 322 at para 7 . [ 24 ] In Alberta ( Workers Compensation Board) v Alberta (Workers Compensation Board Appeals Commission , 2005 ABCA

276, at para 19, Fruman JA offered the following guidance with respect to the process of characterizing a question raised on appeal asone of law or jurisdiction: The reviewing court must also keep in mind that it is in an applicant’s best interest to characterize a question as one of law or jurisdiction,as those questions generally attract a less deferential standard of review. A nimble drafter may succeed in dressing errors of fact in errorof law clothing. Simply asserting a question of law or jurisdiction is insufficient.

The reviewing court must identify the true target of theapplicant’s attack, determine if it raises a question of law or jurisdiction and gauge whether the issue is arguable. When a statutory rightof appeal is conditioned on leave being granted (see, for example, Municipal Government Act, R.S.A. 2000, c. M-26, s. 688(1); AlbertaEnergy and Utility Board Act, R.S.A. 2000, c. A-17, s. 26(1)), this inquiry is performed by the judge hearing the leave application. [25] In Edmonton (City) v Edmonton (Composite Assessment Review Board), 2012 ABQB 171, Topolniski J provided a veryhelpful

summary of the general principles that distinguish a question of law from a question of mixed fact and law. At para 11, sheoutlined these principles in the following terms:

i) An incorrect statement of the legal standard, or test, or an application of incorrect factors in applying the law to the facts is an errorof 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 aquestion of mixed law and fact. iii) However, if a wrong legal principle is used in the application of the law to the facts, or the exercise of the discretion, there is anerror of law. [26] It is now well settled that questions regarding the appropriate valuation method to determine a property assessment is aquestion of mixed face and law in that it involves the application of legal principles to a particular set of facts arising from the evidence:St Albert Housing Society v St Albert (City), 2014 ABQB 556, at para 32.

Questions as to how or whether a particular factor orcircumstance should implicate the assessment of a property is a mater of discretion for the Board and also raises a question of mixed factand law. Question of law or jurisdiction of sufficient importance to merit an appeal [27] A question of law or jurisdiction is sufficiently important to merit an appeal “if it is important for jurisprudential purposes”:Omega2 Corporation v Edmonton (City of), 2005 ABCA 449, at para 9.

The determination of “importance” must be viewed on anobjective basis, not merely on the basis of the subjective importance of the matter to the party seeking leave to appeal. [28] In Altus Group v Edmonton (City), 2014 ABQB 657, Michalyshyn J explained the issue of importance in this context, at para47: The importance must be determined on an objective scale, not the subjective importance of the matter to the applicant. Generally, thereshould be something unsettled about the question, or the decision should have wide-ranging implications.

The issue should not be merelythe correction of a situation fact specific to the one case, without more. The appeal has a reasonable chance of success [29] I agree with the Respondent that the determination of whether an appeal has a reasonable prospect of success requires someconsideration of the standard of review to be applied relative to the proposed appeal. Standard of Review [30] The parties agree that the applicable standard of review in this instance is correctness as regards a question of law flowingfrom a decision of the Board.

The applicable standard of review on a finding of fact, or on a question of mixed fact and law, is palpableand overriding error: Housen v Nikolaisen, 2002 SCC 33 , [2002] 2 SCR 235. This was recently confirmed by the SupremeCourt of Canada in Canada (Minister of Citizenship and Immigration) v Vavilov, 2019 SCC 65, at para 37. [31] Given the Board’s relative expertise in reviewing and considering evidence relating to the assessed value of property, theirdecisions are entitled to deference as to how it considers and weighs evidence during the course of a complaint hearing: St. AlbertaHousing Society v St.

Albert (CARB), 2017 ABCA 129, at para 26-27. Position of the Parties [32] The Applicant maintains that the Board erred in law in two respects in excluding the Calgary Courts Centre and the CalgaryMunicipal Building: (

i) The Board’s reliance on irrelevant considerations to evaluate the market value assessments of the subject properties and decide thecomplaint; and (ii) The Board’s denial of procedural fairness in deciding the Typical Vacancy issue based on a test articulated for the first time by theBoard at the time of the release of its decision, without giving the Applicant notice or an opportunity to respond. [33] The Applicant says that the Board’s exclusion of the Calgary Courts Centre would require that all owner-occupied buildings

should also be excluded from this process. [ 34 ] The Applicant maintains that the test formulated and applied by the Board had no legislative basis in terms of the determination of a property assessment and, further, that the Board relied on irrelevant considerations.

As such, the Applicant says that the application of this test in the decision to exclude these two government-owned properties from the typical vacancy study gives rise to a question of law. [ 35 ] Further, the Applicant says that this test was not advanced by either of the parties involved in the hearing before the Board, and that there was a denial of procedural fairness in not having an opportunity to address the various branches of the test. [ 36 ] The Respondents, on the other hand say that the Board properly excluded the Calgary Courts Centre and the Calgary Municipal Building from the vacancy analysis in light of the fact that these buildings do not compete with privately- owned office properties on the open market.

The Respondents urge the Court to find that this issue is a question of mixed fact and law and, as such, does not meet one of the criteria for leave to be granted. Further, the Respondents say that the issue is not of sufficient importance to merit an appeal, and has no reasonable chance of success. [ 37 ] The Respondents concede that whether the Board denied procedural fairness to the Applicant is a question of law.

Nonetheless, the Respondents say that leave should not be granted as this ground of appeal is not of sufficient important to warrant an appeal and, further, that an appeal has no reasonable chance of success. Analysis [ 38 ] It is common ground between the parties that the Board has, by virtue of s 467 of the MGA , the discretionary power to decide whether or not to change an assessment prepared by the City assessor. Similarly, it is common ground that s 470(1) of the MGA provides for an appeal to the Court of Queen’s Bench of Alberta on a question of law or jurisdiction, with leave of the Court.

Finally, the parties agree that the legislative framework governing that Board was substantially amended effective January 1, 2018. As such, the legislative provisions at play in this matter are those that were in force in 2016. Does this appeal involve a question of law or jurisdiction? [ 39 ] The Applicant advances two arguments in support of its contention that a question of law arises in this instance.

First, the Applicant says that the Board erred “by giving weight to factors that are not part of the legal test to be applied to property assessments.” The Applicant goes on to suggest that the Board relied on a “test to exclude government-owned properties from typical vacancy studies.” Further, the Applicant suggests that the “test” applied by the Board “has no foundation in the legislation governing the preparation of assessments”: Applicant’s Brief, at para 30. [ 40 ] It is, in my view, important to consider the context in which this decision was rendered.

Counsel for the CARB confirmed that CARB decisions are not binding on other CARB panels constituted to consider other complaints. As such, CARB decisions are not binding on the Board, generally. Counsel for the CARB suggested that previous decisions are, or may be, influential, but not broadly precedential. [ 41 ] The decision of the Board in this instance did not create a precedent binding on every other CARB that might be required to consider the inclusion or exclusion of certain properties in a vacancy analysis.

In other words, the Board’s decision in this instance only had application to the particular matter before it. Viewed in such a context, I do not accept the Applicant’s contention that the Board created a test of general application relating to the inclusion or exclusion of government-owned properties. [ 42 ] The word “test” does not appear in the Board’s reasons. A proper reading of the Reasons in their entirety leads to the conclusion that the Board was simply explaining the basis upon which it reached the decision that the two questioned properties should not be included in the typical vacancy study.

The decision then goes on (at para 28) to repeat the four reasons supporting the conclusion that these two buildings, unlike other referenced government-occupied buildings, should not have been included in the vacancy study. [ 43 ] The Board was required in this instance to make a determination of the properties that ought to be part of the typical vacancy study. Pursuant to

section 2 of the MRAT , regulations enacted pursuant to the MGA , a market value-based assessment:

a) Must be prepared using mass appraisal,

b) Must be an estimate of the value of the fee simple estate in the property, and

c) Must reflect typical market conditions for properties similar to that property . (emphasis added) [ 44 ] The Applicant concedes that the relevant legislation is silent as to methodology or the setting of parameters in the determination of typical vacancy rate. The Applicant acknowledges that “[T]here is no legislated test which the City must satisfy in order to include or exclude properties from consideration when deriving parameters within an assessment methodology”: Applicant’s Brief, at para 39.

However, the Applicant immediately thereafter challenges the criteria employed by the Board in excluding the subject properties on the basis that the criteria are not specifically found in s 2 of the MRAT , or in the MGA . [ 45 ] I see no merit in this argument. As previously indicated, I do not accept the Applicant’s characterization of the Board’s reasons for its decision in this instance as amounting to a “test”. The Board’s only role in this process was to make a determination of the issues raised in this particular complaint.

Unlike a Court of Appeal, the Board has no mandate to establish guidelines or precedents that would be binding on future CARBs. It was simply required to resolve the complaint before it and to provide cogent reasons for its decision.

[ 46 ] I also reject this argument on the basis that it is internally inconsistent. I am satisfied that the legislature’s decision not to prescribe a detailed methodology or establish strict criteria was intentional. As such, the legislation clearly contemplates that the application of the stipulated legislative standards will be left to the subject-matter experts, namely tax assessors and the various review boards, including the CARB. [ 47 ] The decision of Bensler J in FHR Real Estate Corporation v Banff (Town of) , 2004 ABQB 557 , is instructive in this regard.

In that instance, an application for judicial review dealing with the tax assessment of the Banff Springs Hotel, the Court considered the

interpretation of the term “similar”. At paras 30 and 33, Bensler J held: The Board routinely reviews property assessments to determine whether they are fair and equitable in relation to the assessment of other taxable properties. In ensuring fairness, the Board is mandated by the Act to consider the assessment of similar properties. Thus, the Board will have developed a finely-honed sense of what factors cause two properties to be “similar” within the context of the legislation and its mandate.

As a result of its expertise in relation to this issue relative to the Courts, the Board ought to be afforded deference… This issue required the Board to interpret the term “similar” as it is used in the legislation. In doing so the Board’s decision would have been informed by its knowledge and experience in assessing property . It would also have had regard to the factual similarities and differences between the Hotel and the comparables submitted by the Applicant. The question is, therefore, one of mixed fact and law.

This factor favours the application of a moderate to high degree of deference. [ 48 ] I accept the Respondents’ contention that the Board “routinely relies on factors or develops ‘tests’ to consider in making decisions about the application of typical income parameters under the income approach to mass appraisal that are not expressly set out in the legislation…”: Respondents’ Brief, at para 61. [ 49 ] The Applicant also challenges the Board’s reference to “21(b)” in paragraph 28 of the Decisions.

As such, the Applicant suggests that this was “an inexplicable specific reference to an external source in criteria ‘c’ “: Applicant’s Brief, at para 44-45. In my view nothing turns on what is clearly a typographical error. I agree with the Respondents that a fulsome review of the questioned paragraph in its entirely leads to the conclusion that the Board was referring to paragraph 28(b), not 21(b).

In my view, nothing turns on this minor error. [ 50 ] In the course of reaching its decision in this case, the Board was required to determine whether or not the Calgary Courts Centre and the Calgary Municipal building were similar to the subject property so as to be included in the typical vacancy study. Within such a context, the Board was required to apply the legislative criteria set out in the MGA and the MRAT in its determination of the Respondents’ complaint relative to the inclusion of the two subject properties.

I accept the Respondents’ submission that the criteria applied by the Board were clearly rooted in the governing legislation. [ 51 ] The applicable legislative criteria included the requirement set out in s 467(3) of the MGA that the Board alter assessments that are not fair and equitable. My review of the various applicable provisions leads me to the conclusion that the legislative scheme focuses on mass appraisal and the grouping of similar properties. In my view, this scheme invites, indeed requires, comparison and the determination of whether to include or exclude certain properties for assessment purposes.

This process of comparison necessarily required a critical analysis of both similarities and differences relating to the various government- owned and occupied properties under scrutiny. [ 52 ] While it is clear that the Applicant disagrees with the Board’s conclusion in this instance, it is noteworthy that in oral argument counsel for the Applicant did not specifically challenge any of the enumerated criteria applied by the Board as being irrelevant or inapplicable.

Rather, the challenge to the criteria appears, somewhat paradoxically I would suggest, to be based solely on the fact that they are not specifically prescribed in the legislation. I would, however, note that the Applicant’s written materials (at para 21) does suggest that the Board relied on irrelevant considerations. [ 53 ] Counsel for the Applicant referred to s 464 of the MGA , and suggested that this provision affords the CARB quite a bit of discretion. I agree.

The provision specifically provides: 464(1) Assessment review boards are not bound by the rules of evidence or any other law applicable to court proceedings and have power to determine the admissibility, relevance and weight of any evidence. [ 54 ] The Applicant conceded that it was open to the Board to make findings of fact and, specifically to make the decision that the two buildings were not similar and, as such, should not be included in the vacancy study that formed part of the assessment.

However, the Applicant went on to suggest that the legislation does not provide for the strictness demonstrated by the Board as regards the criteria that it articulated to justify its decision to exclude the two properties. Counsel for the Applicant was unable to elaborate or further explain this submission when requested to do so. [ 55 ] The Applicant says that the Board’s decision to exclude the two buildings from the vacancy study raises a question of mixed fact and law or, alternatively, a question of law.

However, beyond the assertion, counsel for the Applicant was unable to advance any argument in support of this position.

When pressed by the Court to demonstrate how this raised a question of law, counsel for the Applicant was unable to respond. [ 56 ] As outlined above, I do not accept the Applicant’s contention that the Board improperly constructed a “test” outside of the scope of the governing legislation which it then employed to resolve the question regarding the inclusion of the Calgary Courts Centre and the Calgary Municipal Building in the typical vacancy study. [ 57 ] In my view, the Board was entitled to make findings of fact based on the evidence presented, the submissions of the parties and drawing upon the expertise and experience of the Board in relation to these types of issues.

In the result, I am unable to accept the Applicant’s contention that this first ground of appeal gives rise to a question of law. In my view, the question of whether the two questioned properties were similar to the subject properties involved a question of mixed fact and law.

[ 58 ] The Applicant also challenges the Board’s decision on the basis of what is described as a breach of procedural fairness. The Applicant advances a number of arguments in this regard. First, the Applicant says that the Board placed the onus on the City to show that the Calgary Courts Centre and the Calgary Municipal Building did not meet what the Applicant describes as a “test” for exclusion. The Applicant says that it did not know that it had to meet this “test” and that it did not have notice of the four factors articulated by the Board after-the-fact in its’ Reasons.

The Applicant maintains that the Board “specifically faulted The [sic] City for failing to demonstrate that these two properties had, or could have, publicly available office space so that they could be included in the Typical Vacancy Study”: Applicant’s Brief, at para 42. [ 59 ] Further, the Applicant says that it is contrary to the principles of procedural fairness to “impose a test upon either of the parties after the fact, without giving the parties a full opportunity to respond”: Applicant’s Brief, at para 48.

The Applicant also contends that the source of the “test” was not identified. [ 60 ] I accept the Applicant’s contention that the question of whether a party was denied procedural fairness by the decision maker, in this instance the Board, involves a question of law. This point is conceded by the Respondents. However, for the reasons that follow, I find that this issue is not of sufficient importance to merit an appeal.

I am also satisfied that this issue has no reasonable chance of success. [ 61 ] First, I do not agree that the Board placed any legal onus on the City to show that the Calgary Courts Centre or the Calgary Municipal Building should be included in the study as similar properties. In my view, any onus that may be said to have existed in this instance was an evidentiary onus resting on the Respondents to show that these two properties should not be included in the study once they led some evidence to establish a prima facie case that the challenged assessment was incorrect.

The Applicant faced the same evidentiary onus resting on any litigant dealing with a contested fact in an adversarial process.

As such, like every party advancing a position relative to a contested fact or issue, the Applicant was required to try and persuade the trier to make certain findings of fact and to reach certain conclusions when applying those facts to the applicable law. [ 62 ] In the context of a hearing before an assessment review board, I agree with the Respondent’s characterization of the evidentiary burden resting on the taxing authority once a complainant establishes a prima facie case that the assessment is incorrect.

At para 81 of the Respondent’s Brief, the Respondent states: Once it does [establish a prima facie case] the evidentiary burden shifts to the taxing authority to provide some evidence that the assessment is correct.

The assessment review board is then required to weigh the totality of the evidence to determine whether the complainant has met the persuasive burden to establish that it is more likely than not that the assessment is not fair or equitable. [ 63 ] In this instance, the Applicant failed to adduce any evidence before the Board that either the Calgary Courts Centre or the Calgary Municipal Building had ever offered any of their space for lease.

While the Applicant was not obliged to call evidence to respond to the evidence adduced by the Respondent, there is obviously a risk to a party in not calling evidence: Ross v Edmonton (City) , 2016 ABQB 730 . [ 64 ] It follows that I do not accept the suggestion that the Board placed any improper onus on the Application, or that it was thereby somehow deprived of procedural fairness. [ 65 ] Second, the Applicant maintains that the Board imposed a test on the parties without affording the parties an opportunity to adduce evidence or make submissions relative to that test, thereby breaching the rules relating to procedural fairness.

The Applicant cites no authority for this proposition. [ 66 ] I am satisfied that a proper review of the record reveals that the Applicant was fully aware prior to the hearing of the precise issues to be argued before the Board in conjunction with these complaints. The Applicant is not able to point to any issue or evidence that was not properly disclosed in this regard.

I reject any suggestion that the Applicant was somehow caught by surprise by the scope of the inquiry or, indeed, any of the specific criteria that the Board ultimately relied on in its’ decision to exclude the two challenged properties. [ 67 ] The issue of whether the Calgary Courts Centre or the Calgary Municipal Building should or should not be included in the Typical Vacancy Study was fully argued before the Board. This was one of three issue raised in the complaint filed by the Respondents, as well as in the Respondents’

Summary of Testimonial Evidence filed with the Board. Further, the Respondents fully outlined its’ contentions regarding the inclusion of the Calgary Courts Centre and the Calgary Municipal Building in the vacancy rate study in its filed written submissions. The Applicant had all of this material in its possession in advance of the hearing. [ 68 ] As part of the Respondents’ written submissions, the Applicant was also provided with CARB Decision 99414P-2016, a decision ultimately referenced in the Board’s Decision.

In that case, the Board excluded a municipally owned downtown Calgary property from the vacancy study. In that instance, the Board found that the Andrew Davison building did not compete in the marketplace in the same way as non-municipally owned buildings. In its’ written submissions before the Board, the Applicant included 100 pages of examples of other properties in support of the inclusion of the Calgary Courts Centre and the Calgary Municipal Building in the vacancy study.

The Applicant offered by way of comparison a number of other building that were either leased or owned by an order of government or were owner-use single tenant properties, including the Harry Hays building, the Calgary Board of Education building, the University of Calgary’s downtown campus building, and the Calgary Separate School Board building. [ 69 ] Both parties made detailed submissions before the Board regarding the inclusion of these two properties in the vacancy study.

Further, the transcript of the hearing before the Board reveals that both parties were questioned by Board members relative to this issue. I would note that the Applicant agreed during the hearing that it is “probably not reasonable for the Calgary Courts Centre or the Calgary Municipal Building to be leased on the open market: Transcript, p. 215, l. 9 – p. 224, l. 19. [ 70 ] Under the circumstances, I simply cannot accept the Applicant’s contention that it did not have a full opportunity to file material and advance arguments on this very issue.

While, as previously noted, an alleged breach of procedural fairness gives rise to a question of law, I am satisfied for the reasons outlined above, that the Applicant has no reasonable prospect of success on this issue in this instance.

Is this question of law or jurisdiction of sufficient importance to merit an appeal? [ 71 ] I accept the Respondents’ contention that the issue raised by the Applicant regarding the market value assessment only affects the parties in this matter. Specifically, the issue of whether the Board properly excluded the Calgary Courts Centre and the Calgary Municipal Building in calculating the specific vacancy rate to be applied to the two properties in this instance is a factor-driven issue that only concerns the valuation of the specific properties.

Does the appeal have a reasonable chance of success? [ 72 ] As previously stated, the determination of whether an appeal has a reasonable prospect of success requires some consideration of the standard of review to be applied relative to the proposed appeal. [ 73 ] I agree with the Respondents that the Applicant’s ground of appeal relating to the Board’s decision to exclude the two properties from the vacancy study was a finding that the Board was entitled to make. The Board made a finding that the two buildings were not sufficiently similar to warrant inclusion in the study.

After excluding the two buildings, the Board went on to apply the applicable legal principles and revised the assessments of the two subject buildings accordingly. I accept the Respondents’ contention that no palpable or overriding error is made out in this regard. It follows that the Applicant has no reasonable chance of success on this ground of appeal. [ 74 ] I accept the Respondents’ contention that the Applicant is attempting to use this appeal as a vehicle to re-argue this same issue following the Board’s determination that the two challenged buildings should not be included in the study.

In the result, the Applicant has failed to persuade me that this issue has any importance for jurisprudential purposes or, further, that it has any reasonable prospect for success. Conclusion [ 75 ] For the reasons set out above, this application for leave to appeal is denied. Costs [ 76 ] As the successful party, the Respondents are entitled to their costs. If the parties are unable to agree on the quantum of costs, they may speak to the matter within 30 days of the release of these Reasons. Heard on the 23 rd day of June, 2021. Dated at the City of Calgary, Alberta this 13 h day of October, 2021. M.

David Gates J.C.Q.B.A. Appearances: C. Lam for the Applicant K. Meyer for the Respondents S. Fluker for the Assessment Review Board