Docket: 1742 101050457 Saskatchewan Ltd. v. Gunner Industries Ltd., 2011 SKCA 73

THE COURT OF APPEAL FOR SASKATCHEWAN Citation: 2011 SKCA 73 Date: 20110615 Between: Docket: 1742 101050457 Saskatchewan Ltd. and Gunner Industries Ltd. Appellants (Plaintiffs) - and - Provincial Mediation Board Respondent (Defendant) - and - City of Regina Intervenor (Intervenor) Coram: Richards, Caldwell and Herauf JJ.A.

Counsel: Christopher Butz for the Appellants Barry Hornsberger, Q.C. for the Respondent Jana-Marie Odling for the Intervenor Appeal: From: 2009 SKQB 152 Heard: June 15, 2011 Disposition: Appeal dismissed (orally) Written Reasons: June 20, 2011 By: The Honourable Mr. Justice Richards In Concurrence: The Honourable Mr. Justice Caldwell The Honourable Mr. Justice Herauf Richards J.A. I. Introduction [ 1 ] This is an appeal from a Queen’s Bench decision denying writs of mandamus and prohibition sought by the appellant companies against the respondent, Provincial Mediation Board.

We dismissed the appeal from the bench with a promise of written reasons to confirm those given orally in the court room. These are those written reasons. II. Background [ 2 ] 101050457 Saskatchewan Ltd. (the “Company”) owns two properties in the City of Regina. The other appellant, Gunner Industries Ltd., was struck from the registry in 2005 and, as found by the Chambers judge, has no capacity to participate in these proceedings. [ 3 ] Taxes on both properties have been in arrears for approximately eight years.

The total owing with respect to them is now in excess of $200,000. [ 4 ] The City registered tax liens and then requested the consent of the Provincial Mediation Board to take title to both properties. This was required because, as provided in s. 7(1) of The Provincial Mediation Board Act , R.S.S. 1978, c. P-33, a municipality may obtain title to land pursuant to The Tax Enforcement Act , R.S.S. 1978, c.

T-2 only on the prior written consent of the Board. [ 5 ] On the request of a debtor or any of his or her creditors, the Board is required to proceed as described in s. 6(1) of The Provincial Mediation Board Act : 6

(1) Upon receipt of an application in writing by or on behalf of a debtor or any of his creditors, the board shall confer with and advise the debtor or his creditor and shall endeavour to bring about an amicable arrangement for payment of the debtor’s indebtedness without recourse being had to legal proceedings, and for that purpose the board shall inquire into the validity of claims made against the debtor and his ability to pay his just debts , either presently or in the future, and shall endeavour to effect an agreement between the debtor and his creditors to provide for the settlement of the said debts, either in full or by a composition. [Emphasis added] [ 6 ] In this case, the City proposed a three-year payment plan with respect to each property.

Between May 2005 and August 2008, the Board attempted to establish some sort of workable arrangements in this regard. It was ultimately unsuccessful.

[ 7 ] In September 2008, the Company filed a notice of motion in the Court of Queen’s Bench seeking orders of mandamus and prohibition against the Board. It did so in an effort to require the Board to “inquire into the validity of the [tax claims made by the City]” and to require the Board “to withhold issue ( sic ) of consent pursuant to section 7(1) of The Provincial Mediation Board Act pending resolution and exhaustion of the assessment appeal proceedings underway in accordance to ( sic ) The Cities Act .” [ 8 ] The Chambers judge denied the application.

He said that the assessment and taxation regime under The Cities Act constituted a complete statutory code and that the Board could play no role in determining the validity of tax assessments. He wrote as follows: [13] The respondent Board has no jurisdiction to inquire into the validity of the impugned assessments. The Board can do no more than ascertain that taxes are owing; they have been assessed in accordance with the statutory procedures; any payments made have been properly credited; and the taxpayer has means to pay what is owing.

Nothing is said which would suggest the respondent Board has failed to inquire into the described matters and thereby conclude that the tax debt is valid. Equally, there is nothing to suggest that the Board failed to mediate. In fact, the opposite appears to be reality. [ 9 ] The Company now appeals from that decision. III. Analysis [ 10 ] The Company submits that the Board acted contrary to common law principles of fairness in dealing with this matter. We cannot accept this line of argument. The duty of fairness, speaking broadly, relates to participatory rights in relation to administrative decision- making.

There is simply nothing in the record here to engage those sorts of concerns. [ 11 ] That said, the Company does raise what amount to four sets of concerns about the Board’s actions. I will deal briefly with each of them. [ 12 ] First, the Company says that its right to pursue appeals already underway in relation to the assessment of its property will be lost if the City is allowed to take title. This concern is misplaced.

Section 197 of The Cities Act , S.S. 2002, c. C-11.1, dealing with property assessments, provides a right of appeal to a board of revision for any person who has “an interest in any property.”

Section 216 of the same Act says “any party to an appeal before a board of revision” may appeal a board of revision decision to the Saskatchewan Municipal Board.

Section 33.1 of The Municipal Board Act , S.S. 1988-89, c. M-23.2 then gives a right of appeal to this Court to “any person affected by an order, decision or determination of the [Municipal Board].” In the result, the Company will have a full opportunity to play out to the end, if it sees fit, any appeals in the system that are not yet finally resolved if and when the City takes title to the property in issue. [ 13 ] Second, the Company says the Board failed to discharge its obligations under s. 6(1) of The Provincial Mediation Board Act . We are not persuaded on this point either.

The onus of establishing any breach or failing of this sort lies on the Company and it has not discharged that burden. In relation to the Board’s obligation to “endeavour to bring about an amicable arrangement for payment,” it is clear from the affidavit of Debie Clermont that the Board made a number of attempts to mediate a settlement between the Company and the City. These efforts were ultimately unsuccessful but there is nothing in the record to suggest the Board did not satisfy its obligations under the Act .

Similarly, there is nothing before us to suggest that the Board did not “inquire into the validity of claims” made by the City against the Company. Here we note that (as properly conceded by the Company) the Board has no independent authority to determine whether the assessments underlying the Company’s tax indebtedness were properly made. Issues of this sort are addressed by the appeal process established pursuant to The Cities Act and The Municipal Board Act .

As indicated by the Chambers judge, the Board’s mandate is limited to matters such as ascertaining whether taxes are owing and whether any payments have been properly credited. The record cannot be read as suggesting this was not done. [ 14 ] Third, the Company argued that the Board was not entitled to allow the City to move ahead with tax enforcement unless and until all of the assessment appeals in relation to its property are finally exhausted. We cannot accept this argument.

If the Company is correct, a property owner could avoid tax enforcement proceedings indefinitely by the simple expedient of launching a new appeal each assessment year. This sort of construction of The Provincial Mediation Board Act would frustrate the overall scheme of tax enforcement put in place by The Cities Act and, in our view, would self-evidently run counter to the Legislature’s intentions. [ 15 ] Fourth and finally, the Company placed some emphasis on the possibility that taxes might be abated pursuant to s. 244(1) of The Cities Act .

It suggested that, because of this possibility, the Board cannot authorize the City to obtain title on account of unpaid taxes. Section 244(1) reads as follows: 244(1) With respect to any year, if a council considers it equitable to do so, it may, generally or with respect to a particular taxable property or a class of taxable property, do one or more of the following, with or without conditions:

(

a) cancel or reduce tax arrears; (

b) cancel or refund all or part of a tax; (

c) defer the collection of a tax. [ 16 ] Counsel for the City was correct in saying that this provision is effectively irrelevant to the proceedings at hand. It is an extraordinary option available to a city council inclined to use it. As such, it lies outside of the statutory regime governing the operations of the Board and cannot be invoked as a basis for precluding the Board from consenting to a city taking title in tax enforcement proceedings. We note the obvious point that, if the Company’s submissions on this issue are correct, no city could ever obtain title because of unpaid taxes.

The Legislature cannot be taken to have intended such a result. IV. Conclusion [ 17 ] The Company’s appeal must be dismissed. The Chambers judge clearly and correctly analyzed the issues presented to him. [ 18 ] Neither the Board nor the City sought costs. As a consequence, there will be no order in this regard.