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Real property tax assessments : an examination of the consequences of a departure from the specified.. Leigh, Clive Michael 1967

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REAL PROPERTY TAX ASSESSMENTS: AN EXAMINATION OF THE CONSEQUENCES OF A DEPARTURE FROM THE SPECIFIED BASIS OF ASSESSMENT by CLIVE MICHAEL LEIGH B.Sc. (Estate Management), University of London, 1964. A SR,I SC #S«, A aA sI v A THESIS IN COMMERCE SUBMITTED TO THE FACULTY OF GRADUATE STUDIES IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION We accept this thesis as conforming to the required standard THE UNIVERSITY OF BRITISH COLUMBIA September 1967 In p r e s e n t i n g t h i s t h e s i s i n p a r t i a l f u l f i l m e n t o f t h e r e q u i r e m e n t s f o r an advanced d e g r e e a t t h e U n i v e r s i t y o f B r i t i s h C o l u m b i a , I a g r e e t h a t t h e L i b r a r y s h a l l make i t f r e e l y a v a i l a b l e f o r r e f e r e n c e and S t u d y . I f u r t h e r a g r e e t h a t p e r m i s s i o n f o r e x t e n s i v e c o p y i n g o f t h i s t h e s i s f o r s c h o l a r l y p u r p o s e s may be g r a n t e d by t h e Head o f my Depar tment o r by h.i._ r e p r e s e n t a t i v e s . I t i s u n d e r s t o o d t h a t c o p y i n g o r p u b l i c a t i o n o f t h i s t h e s i s f o r f i n a n c i a l g a i n s h a l l n o t be a l l o w e d w i t h o u t my w r i t t e n p e r m i s s i o n . Depar tmen t o f C>fen_€. The U n i v e r s i t y o f B r i t i s h Co lumb ia Vancouver 8, Canada ABSTRACT The real property tax plays a significant part in the f i s c a l systems of the United Kingdom and Canada; and i t is important that the burden of the tax is distributed according to the wishes of the legisla ture.. Generally, the l i a b i l i t y to the tax varies with the 'value1 of real property owned or occupied by the taxpayer; but 'value' is a term that requires definition. Where the interpretation of the term by the assessors differs from the legal definition, the distribution of the tax burden w i l l differ from that desired. In addition, a con f l i c t w i l l exist with each new assessment between adopting the asses sor's interpretation of the 'value' concept and adopting the legal definition. The examination of these problems is not limited to the con text of any one particular jurisdiction, but reference is made to the situation in England and Wales, and in Canada. I t is shown that the legislature has many alternatives avail able when adopting a basis of assessment and the bases adopted in B r i  tish Columbia and England and Wales are examined as examples. If the current assessments diff e r from those required by law, the assessor has, in practice, a number of alternatives available for the maintenance of the r o l l between revaluations. These are considered. I t i s seen that only where there is a constant relationship between existing i i i assessments and those required by law, w i l l the distribution of the tax burden be correct. In other cases inequality w i l l result and measures of the extent of this inequality are proposed. The conflict between the meanings of 'value' to be adopted for new assessments w i l l depend on the definitions laid down by Statute and by the judiciary; on the meaning adopted by the assessor; and on the legal provisions for uniformity of treatment. Examples of the legal provisions for uniformity of treatment in England and Wales and in Canada are examined but no universal solution to the conflict is produced. Instead i t is suggested that new properties be brought onto the r o l l at figures which would improve the distribution of the tax burden. Finally in view of the imperfections in the real property tax, alternative treatments for i t s improvement are summarised. TABLE OF CONTENTS PAGE CHAPTER I. INTRODUCTION 1 A. Statement and Justification of Problem 1 B. Organisation of Thesis 12 C. Equality of Treatment 14 CHAPTER II. BASES OF ASSESSMENT 27 A. Value i s not Price 28 B. Value to the Owner 30 C. The Assumptions of Market Value 31 D. Existing Use Values and Values in Exchange 35 E. Rental Values or Capital Values . . . 37 F. Date of Valuation 38 G. Cost 40 Conclusion 41 CHAPTER III. LEGAL PROVISIONS FOR THE DETERMINATION OF VALUE 42 A. . England and Wales 42 England and Wales -- Judicial Interpretation 44 England and Wales Conclusion 48 England and Wales Recent Enactments 49 B. British Columbia 50 British Columbia — Judicial Interpretation 53 Brit i s h Columbia -- Conclusion 60 PAGE CHAPTER IV. THE EXISTENCE OF INCORRECT BASES OF ASSESSMENT. 63 A. England and Wales . . 64 B. Canada 67 Summary 76 CHAPTER V. UNIFORMITY OF TREATMENT 77 A. England and Wales — Statutory Provision 78 B. England and Wales — Judicial Provisions 82 C. Canada Statutory Provisions 88 D. Canada -- Judicial Provisions 94 Conclusion 100 CHAPTER VI. THE MAINTENANCE OF ASSESSMENT ROLLS 102 A. Unaltered Assessment Rolls 106 B. Pro-Rata Increases in Assessments 114 C. Revised Assessment Rolls 115 D. Problems Connected with the Revision of an Assessment Roll 117 1. Timing 117 2. Extent of Revision 120 3. Establishment of New Assessments 122 E. British Columbia 124 Summary 126 CHAPTER VII. CONCLUSIONS 129 Further Study 136 BIBLIOGRAPHY 139 PAGE APPENDICES 149 APPENDIX A . 150 APPENDIX B 151 APPENDIX C 156 LIST OF TABLES TABLE PAGE I Canada Selected Fiscal Statistics 2 II United Kingdom — Selected Fiscal Statistics 3 III The effect of correcting a Single Assessment on i a Hypothetical Roll 1109 \ ACKNOWLEDGEMENT In the production of this dissertation I have become indebted to many people including my fellow students, and members of Faculty. They are too numerous to mention here, but I thank them a l l , particu l a r l y those who assisted me with the mathematical sections of the paper. I am especially grateful to Dean Philip H. White without whose advice and assistance this work would not have been successfully com pleted. A l l errors and omissions must however, remain the responsi b i l i t y of the writer. 1 . CHAPTER I INTRODUCTION A. Statement and Justification of Problem The real property tax plays an important part in the systems 1 of public finance of both Great Britain and Canada, and its signifi cance can be appreciated by reference to Tables I and II which set out some selected statistics which relate to the two countries. Between 1 9 5 9 and 1 9 6 5 the significance of the real property tax in Canada increased as a percentage of Gross National Product from 3 . 0 % to 3 . 4 % . However the percentage of Municipal Real Property tax receipts to Total Municipal Government Revenue decreased from 4 7 . 2 7 . 2 to 4 4 . 5 % . According to the Canada Year Book in 1 9 6 1 Real Property Taxes (including personal property taxes in Manitoba and business taxes in Ontario and Saskatchewan) accounted for 8 4 . 8 7 o of the total tax revenue and 6 5 . 3 7 o of total gross ordinary revenue, of the Municipal Governments. In the United Kingdom in the years 1 9 5 9 and 1 9 6 5 the real property tax yielded 3 . 3 % and 4 . 0 % of Gross National Product (as 1 New Sources of Local Revenue, A report of a Study Group of the Royal Institute of Public Administration (London: George Allen & Unwin Ltd., 1 9 5 6 ) ; J.H. Perry, Taxation in Canada (Toronto: University of Toronto Press, 1 9 , 6 1 ) . ^ Canada Year Book 1 9 6 6 (Ottawa: Dominion Bureau of Statis tics, 1 9 6 6 ) , Table 3 2 , p. 1 0 0 9 , and Table 1 , p. 9 6 1 . 2. TABLE I  CANADA SELECTED FISCAL STATISTICS MILLIONS OF DOIJLARS 1959 1965 (1) Gross National Product 34,915 51,996 Total Federal Government Revenue 6,043 8,973 Total Provincial Government Revenue 3,120 6,336 Total Municipal Government Revenue 2,220 3,945 Total Government Revenue 11,383 19,254 Excluding Inter-govt. transfers 9,857 16,373 Provincial Real Property Tax 8 11 Municipal Real Property Tax 1,048 1,755 (1) At market prices. Source: National Accounts: Income and Expenditure (D.B.S. 1965.) Tables 1, 9, 36, 40. 3. TABLE II UNITED KINGDOM SELECTED FISCAL STATISTICS MILLIONS OF POUNDS STERLING 1959 1965 21,389 5,244 6,653 1,802 714 10,182 30,904 7,789 1,230 3,128 (1) Total Gross National Expenditure at factor cost. (2) On current account. (3) Taxes on income and taxes on expenditure. (4) On current account. (5) In Great Britain the Real Property tax is known as "Rates". Source; Great Britain. Central Statistical Office. Annual Abstract  of Statistics. No. 103. (London: H.M.S.O., 1966), Tables 296, 299, 300. 4 . defined) respectively and 3 9 . 7 and 3 9 . 3 % of the total receipts of local authorities. In 1965 the real property tax accounted for 9.17%, of Total Government Revenue in Canada and 9.247o of the Total receipts of the Central Government and the Local Authorities in the U.K. In both countries the assessors are required to ascertain the value of a l l property that is subject to the tax in accordance with the provisions of the taxing statute. Often however the asses sors f a i l to comply with the requirements of the Statute and the basis of assessment generally adopted in the r o l l may differ from that required by the Statute: The inquiry which we conducted among 267 urban municipalities showed that :Linmoveable properties were quite often assessed well under real value, despite legal provisions to the con trary. ^  Another Royal Commission commented We are, however, aware of two cases, and we have no means of knowing i f there are more, in which general revaluations are being made at a level of value which is significantly different from that laid down by legislation.^ It became apparent that such a situation existed in Great 5 Britain between the passing of the Local Government Act of 1948 and 3 Report of the Royal Commission on Taxation. (Quebec: Government of Quebec, 1 9 6 5 ) , p. 2 7 1 . ^ Report of the Royal Commission on Finance and Municipal Tax  ation in New Brunswick (Fredericton: /jThe Queen's Printer/, 1 9 6 3 ) , p. 2 2 4 ; See also F:H. Finnis, "Real Property Assessment in Canada" Cana dian Tax Papers, No. 3 0 . (Toronto: Canadian Tax Foundation, 1962) Chapter IV. 11 and 1 2 . Geo. 6 c. 2 6 . 5. the revaluation of a l l property for property tax purposes which came into effect in 1956. In this period, the discrepancy between assessed values (generally i n terms of 1934-1939 values) and current market values was so great that the assessors sought to assess new and altered properties on the same level of value as had been adopted for existing assessments. This practice, known as valuing on the "tone of the l i s t " , was recognized by the Lands Tribunal, the body given f i n a l jurisdiction 6 over appeals against property assessments on questions of fact. Whenever tone of the l i s t assessments are employed a conflict w i l l arise when assessing new or altered property, between the achieve- 7 ment of uniformity at the existing level of assessment and the adoption of current market values in accordance with the legislative provisions. A similar conflict w i l l arise where the Statute requires assessment on a basis of assessment other than current market value but where the assessors have failed to comply with the Statutory requirements and have adopted another basis of assessment. In either case as long as the assessments bear a constant relationship with assessments in accordance with the Statutory require- 6 H.B. Williams et a l . (ed.), Ryde on Rating; The Law and  Practice (11th edition; London: Butterworth and Co. (Publishers) Ltd., 1963) p. 397. In Great Britain the assessment r o l l is known as the valuation l i s t . ^ "Uniformity"will here be given the same meaning as in the period between 1950 and 1956 in Great Britain i.e. assessments are to be made by reference to values current at the same time; a separate and proper valuation should be made of each property and the same evi dence so far as is relevant should be employed in arriving at the value of comparable properties. Rating and Income Tax (London: Solicitors Law Stationery Soc. Ltd.) Vol. XLII (1949), 488, and Vol. XLV (1952), 675. 6. ments. the proportion of the total burden of the tax borne by each taxpayer w i l l be that intended by the taxing statute. Equality of 8 treatment w i l l thus be achieved by the use of tone of the l i s t as sessments. For example, i f each taxpayer i s uniformly assessed at a quarter of the stipulated value of his property, the taxing authority would be required to levy a rate equal to four times that which would be levied on statutory assessments in order to raise the same amount of revenue, and each taxpayer's l i a b i l i t y would be the same under either basis of assessment. However, although there i s no effect on the l i a b i l i t y of each taxpayer within a taxing area, inequality could arise between different taxing areas i f differing bases of assessment are adopted and the assessments then used for a common purpose such as grant a l l o  cation, or the raising of revenue for a superior authority. The achiev ing of equality between taxing areas i s known as "equalisation" and can be simply obtained where the assessments in the r o l l bear a con stant relationship to the statutory assessments. Equalisation has 8 "Equality of treatment" w i l l be interpreted to mean the treatment of each individual in accordance with the intentions of the taxing statute i.e. i t w i l l be achieved when each taxpayer is bearing the same burden of taxation as i f the assessments had been made in accordance with the statutory provisions. C.F. Rating and Income  Tax, op. c i t . , XLV, 675. 7. been considered at length elsewhere and will not be dealt with 9 here. The problems resulting from the use of a basis of assessment other than that required by the statute will not be restricted to the conflict between the bases of assessment to be adopted for new assess ments and the necessity of equalisation, but will involve the identi fication of the "tone of the l i s t " (or rather "tones" of the l i s t since different tones may be employed for different classes of property). The latter will be an extremely complex problem particularly where the assessments vary widely from the basis of assessment adopted by the as- 10 sessors. In an unpublished M.B.A. Thesis, B.I. Ghert examined the statistical measures available for establishing the accuracy of the 11 assessment ro l l and concluded The results . . . indicate that as in a l l other problems associated with the valuation of.property the measurement of assessment quality and uniformityl2 requires the exercise of judgement in a real world. ^ Guide for Assessment-Sales Ratio Studies. A report of the Committee on Sales Ratio Data of the National Association of Tax Admin istrators. (Chicago: The Federation of Tax Administrators, 1954); J.C. Bonbright The Valuation of Property (Charlottesville, Va.: The Mitchie Company, 1965) I, p. 504; D.H Clark, W.J. Oliver, CH. Chappell and F.H. Finnis, "Uniform Assessments" 1958 Conference Report (Toronto: Canadian Tax Foundation, 1959), pp. 140-171; "Report of the Ccimmittee on State Equalization of Local Property Tax Assessments" Proceedings of  the Fifty-first Annual Conference (Harrisburg, Pa.: National Tax Assoc iation, 1959), pp. 315-357; State and Local Taxation of Property (New York: National Industrial Conference Board, 1930), Chapters II and III. 10 "Measures of the Quality of Real Property Assessments: An examination of their validity." (The University of British Columbia. Vancouver, December 1965.) ^ B.I. Ghert. op. cit., p. 134. 12 In Mr. Ghert's terms "uniformity of assessment"requires that every assessable property be included in the l i s t at its basis of assessment. 8. Consequently until more satisfactory measures are developed i t must be left to the individual appraiser to establish which assess ments are accurate and can be used in establishing the "tone" of the assessment r o l l . The accuracy of each assessment is thus a matter of opinion. In Great Britain between 1950 and 1956 the Lands Tribunal accepted evidence of other assessments but;required an examination of 13 their relevance to the "tone of the l i s t 1 . Throughout this disser tation i t will be assumed that the "tone" of the l i s t can be discovered by examination of the existing assessments, and the discussion of this very real problem will be left to Mr. Ghert's thesis. So far we have been concerned with problems arising out of the use of assessments which differ from, but bear a constant rela tionship with assessments in accordance with the statutory requirements. This constant relationship will not automatically exist, since i t will be altered whenever there have been changes in circumstances between the time to which the assessments in the r o l l refer and that specified by statute, so that the values of different classes of property have been affected in different ways. Here the maintenance of equality of treatment of individual taxpayers will be more difficult. To ensure equality of treatment in accordance with the intention of the statute, the property assessments should be adjusted to maintain the same re lationship with statutory assessments as previously existed. 13 Morrissey v. Morley. (1952) 45 R. and I.T. 282; Stringer  v. Wilson. (1953) 46 R. and I.T. 431. See also Rating and Income Tax  op. cit., XLIV, 115. 9 . This would require the identification of a l l changes in pro perty values, the identification of a l l properties affected by the changes in value and the devising of a new scale of values to accord with the new circumstances. Such a task would present enormous problems and would pro bably be more complex than the maintenance of a legally correct as sessment r o l l . However some of the d i f f i c u l t i e s and conflicts involved in assessing on the tone of the assessment r o l l instead of in accordance with the statutory requirements w i l l be identified and examined. The d i f f i c u l t i e s involved in maintaining the constant rela tionship between assessments in the r o l l and assessments based on the statutory provisions, where values are changing, would be magnified by the conflict between equality of treatment and the statutory re quirements since each new assessment may be challenged on the grounds that i t failed to comply with the statutory requirements. Should the assessor endeavour to revise the assessments in a piecemeal fashion, he may admit appeals against the revised assessments on the grounds of failure to achieve uniformity of treatment with unaltered assessments of similar properties which remained on the r o l l . Consequently each revision of the assessment r o l l must be complete in i t s e l f in order to prevent appeals against the revisions. 10. In some cases there may be an express requirement of unifor- 14 15 mity or equality of treatment or i t may be implied. Such an ex press provision may be s t r i c t l y followed, providing authority for assessments on the tone of the l i s t , in which event the conflict be tween equality of treatment and correct assessments may not occur. However, i t may be interpreted to require uniformly correct assessments in which case the conflict w i l l exist but with the requirement of assess ment in accordance with the statutory provisions being given added 16 weight in law. Alternatively the absence of such a provision may give strength to the opinion that the provisions of the statute should be s t r i c t l y followed and that the achievement of equality of treatment should be l e f t to the legislators. In some cases the statute may f a i l to express unequivocally the basis of assessment to be adopted and i f differing interpretations are placed on the statutory provisions by various authorities, the maintenance of equality of treatment may be hampered. 14 Assessment Equalization Act. R.S.B.C. 1960 c. 18 s. 46(1); and 1961 c. 3 s. 6. E.g. after the passing of the Local Government Act 1948 (11 and 12. Geo 6. c. 26.) when uniformity was removed as grounds for an objection against an assessment. 1 6 See the line of cases following the decision in Ladies  Hosiery and Underwear Ltd. v. West Middlesex A.C. /1932/ 2 K.B. 679. 11. Generally, the problems mentioned arise from the ab i l i t y of the assessor to depart from the basis of assessment required by Statute " and the desire to achieve equality of treatment of individual taxpayers once such a departure has been made. Clearly i t i s desirable to ob tain assessment r o l l s on which a l l assessments accord with the statu tory requirements, but in many cases these do not now exist: It i s . . . notorious that the assessment often bears l i t t l e 1 7 relation to the 'value' of the property. and i t may be some time before such r o l l s exist since: Anyone who contemplates the slow pace of property tax assess ment reform in Canada or elsewhere cannot have any doubt that assessment i s commonly regarded as a subordinate a c t i  vity in the scheme of government.^ and further the rapid change in property values between revaluations w i l l foster the use of tone of the l i s t assessments in the interim 19 period. Whenever tone of the l i s t assessments are used without statu tory authority this conflicts w i l l arise. If the conflict cannot be resolved an attempt should be made to achieve equality of treatment i n accordance with the statutory provisions since the equal treatment of 20 equals i s a fundamental requirement of any tax, and only assessment 17 Ewing J.A. in Re Withycom.be Estate A9447 1 W.W.R. 385, 397. 18 Report of the Royal Commission on Finance and Municipal  Taxation i n New Brunswick, op. c i t . , p. 206. For example the Local Government Act 1966. c. 42. ss., 17, 18.; See Appendix A. Adam Smith. An Enquiry into the Nature and Causes of the  Wealth of Nations. (New York: The Modern Library, Random House Inc., 1937), Book V, Chapter II, Part.II, p. 777. 12. in accordance with the statute will completely remove the conflict. If correct assessments, and therefore equality, cannot be achieved the fate of the real property tax should be reexamined and i f necessary i t should be replaced by another tax that is capable of producing equality of treatment. B. Organization of Thesis. Before examining the existing provisions concerning the use of tone of the l i s t assessments the fundamental concepts will be. ex amined. Firstly the principles underlying the use of the real property tax will be investigated since any consideration of the desirability of alternative policies that can be adopted will require the establish ment, of a criterion of quality. The quality of an assessment ro l l will depend on its ability to achieve the desired ends. However those ends, as expressed in legislation may differ from those inherent in the principles underlying the use of the real property tax. If they do there may be a conflict between compliance with the requirements of the law and complicance with the underlying principles. Although the con f l i c t ought not arise in practice (the former being paramount) its existence must be recognised. The possible effects of a failure to achieve equality of treatment will be considered. The possible bases of assessment that can be adopted will then be examined and in dealing with historic values the requirement of equality will be introduced so that the effect of maintaining a 13. r o l l o n t h e b a s i s o f h i s t o r i c v a l u e s a n d c i r c u m s t a n c e s c a n b e c o n s i d e r e d . I t w i l l b e shown t h a t t h e f a i l u r e t o r e v i s e a s s e s s m e n t s t o a c c o r d w i t h c h a n g e d c i r c u m s t a n c e s w i l l r e s u l t i n i n e q u a l i t y o f t r e a t m e n t b e t w e e n t a x p a y e r s . T h e l e g i s l a t i v e a n d j u d i c i a l p r o v i s i o n s r e l a t i n g t o t h e b a s i s o f a s s e s s m e n t o f B.C. a n d t h e U.K. w i l l b e c o n s i d e r e d t o i l l u s t r a t e t h e u s e o f d i f f e r i n g b a s e s o f a s s e s s m e n t a n d t h e a m o u n t o f d i s c r e t i o n t h a t i s l e f t w i t h t h e a s s e s s o r . I n C h a p t e r I V e x a m p l e s o f a s s e s s m e n t s o n b a s e s o t h e r t h a n t h o s e r e q u i r e d b y s t a t u t e w i l l b e i l l u s t r a t e d a n d i n C h a p t e r V t h e e x i s  t e n c e a n d s i g n i f i c a n c e o f s t a t u t o r y o r j u d i c i a l a u t h o r i t i e s f o r a s s e s s  m e n t s i n a c c o r d a n c e w i t h t h e " t o n e - o f - t h e - l i s t " , o r f o r u n i f o r m i t y o f t r e a t m e n t , w i l l b e c o n s i d e r e d . E x p r e s s l e g i s l a t i v e o r j u d i c i a l p r o v i  s i o n s may i n c e r t a i n c i r c u m s t a n c e s r e m o v e t h e c o n f l i c t b e t w e e n c o r r e c t a s s e s s m e n t a n d u n i f o r m i t y o f t r e a t m e n t . I n t h e f o l l o w i n g C h a p t e r t h e p r o b l e m s c o n f r o n t i n g t h e a s s e s  s o r w i l l b e c o n s i d e r e d . S i n c e p e r f e c t a d j u s t m e n t o f a l l a s s e s s m e n t s t o a c c o r d w i t h new c i r c u m s t a n c e s may b e i m p r a c t i c a b l e t h e a s s e s s o r w i l l b e c o n f r o n t e d b y t h e c o n f l i c t w h e n e v e r new p r o p e r t i e s a r e b r o u g h t o n t o a n i m p e r f e c t r o l l o r w h e n e v e r e x i s t i n g a s s e s s m e n t s m u s t b e r e v i s e d . T h e a l t e r n a t i v e s o p e n t o t h e a s s e s s o r w i l l b e c o n s i d e r e d i n t h e l i g h t o f a l t e r n a t i v e p o l i c i e s f o r t h e m a i n t e n a n c e o f t h e a s s e s s m e n t r o l l 14. between revaluations. In endeavouring to establish the relative merits of the alternatives, c r i t e r i a by which assessment r o l l quality can be examined, w i l l be considered. The effect of across-the-board percentage increases of existing assessments w i l l be considered as w i l l the d i f  f i c u l t i e s facing the assessor who endeavours to revise the r o l l be tween revaluations. Finally the i n i t i a l problem, the conflict between correctness and uniformity w i l l be examined i n the light of the earlier discussion. A recommendation w i l l be made for equitable rather than uniform or cor rect assessments. I t w i l l be shown that the existence of the conflict i s an indication of unsatisfactory tax administration and policies for the future treatment of the real property tax w i l l be outlined. C. Equality of Treatment The real property tax i s not collected from real property but i s levied on individuals in respect of the property that they own (or in the U.K., occupy). Being impersonal, real estate cannot pay taxes since i t has no capability, per se, to make any form of payment, neither has i t the access to funds out of which the tax must be paid. Although the term 'property' i s commonly used to refer to the physical aspects of real estate and other tangibles, i t more correctly refers to 21 the "bundle of rights" possessed by individuals in those assets. The 2 T K.E. Boulding. Principles of Economic Policy (Englewood C l i f f s , N.J.: Prentice Hall, 1958), p. 30. 15. real property tax is consequently levied on individuals in respect of their rights of ownership over real assets. In the United Kingdom the tax (known as "rates") is levied on the occupiers of real estate and the basis of assessment is the annual rental value of the premises occupied. In Canada i t is generally levied on the owners of real 22 estate and the basis of assessment is i t s capital value. Although the burden of the tax f a l l s , in the f i r s t place, on the owner of a particular type of interest in real estate i t s ef- 23 fective incidence is d i f f i c u l t to determine, and i t s effects w i l l be f e l t eventually, by the holder of every interest i n real estate. Since the real property tax is a tax on individuals, equality of treatment must be achieved between individuals and not between classes of real estate. As mentioned earlier, equality of treatment has been interpreted to mean the treatment of each individual in ac cordance with the intentions of the taxing statute; there is however another concept which must be implied into the words of the Statute. 24 Bonbright refers to i t as "uniformity" whilst the Carter Commission describes i t as "equity" and comments 22 St. Johns, Newfoundland however uses rental values as i t s basis of assessment; F.H. Finnis "Real Property Assessment in Canada" op. c i t . , Chapter IV. 23 U.K. Hicks. Public Finance (London: Cambridge University Press, 1956), Chapter XI; R.U. R a t c l i f f . Urban Land Economics (New York: McGraw-Hill Book Co. 1949), p. 422; R. Turvey, The Economics  of Real Property (London: George Allen and Unwin, 1957) Chapter VI; J.F. Due. Government Finance (Homewood, I l l i n o i s : Richard D. Irwin, Inc., 1963) Chapter XXI. 24 J.C. Bonbright. op. c i t . , p. 500. 1 6 . Equity has two dimensions. Horizontal equity requires that individuals and families in similar circumstances bear the same taxes. Vertical equity requires that those in different circumstances bear appropriately different taxes.25 Two major problems are involved in the achievement of "hori zontal equity" and "vertical equity". F i r s t l y the criterion by which 'equals' are to be recognized must be established; and this w i l l depend on the type of tax with which we are concerned since different princi ples of taxation can be applied to different taxes. Secondly the rela tive burdens which "unequals" are to bear must be specified, and this w i l l depend on the criterion of equality adopted. These problems have great significance for the real property tax, and the legislators' choice of basis of assessment w i l l depend on their solutions to these questions. They are correctly value judge ments, but the principles of taxation ( i f not the principles of Govern- 26 ment Expenditure) should be considered in arriving at a decision. Although some sources have considered many theories of taxa- 27 tion much of the discussion on the real property tax centres on the 2 8 principles of a b i l i t y to pay and benefits received. — : 2 T Report of the Royal Commission on Taxation (/jOttawji/: The Queen's Printer, 1 9 6 6 ) Vol. I. pp. 4 - 5 . A.M. Moore, A . I . Guttman and P.H. White. Financing Educa tion in Bri t i s h Columbia (Vancouver: British Columbia School Trustees Association, 1 9 6 5 ) , Chapter II; J.C. Bonbright op. c i t . , Chapter XVII. 27 H.A. Silverman. Taxation, Its Incidence and Effects (Lon don: Macmillan and Co., 1 9 3 1 ) . 2 ^ J.F. Due. op. c i t . , Chapter VI; J.C. Bonbright. loc.  c i t . ; E. Cannan. The History of Local Rates in England (second edition, London: P.S. King and Son, 1 9 2 7 ) , p. 1 5 9 . 17. According to the principle of a b i l i t y to pay, those with equal wealth should bear an equal amount of taxation. Wealth can be considered in terms of annual income or assets possessed. Originally, real property holdings were a good indication of wealth and the efficacy of the real property tax could be judged in the light of this criterion. Today however, in view of the number of forms in which assets can be held; including bonds, stocks, and personal tangible property; and in view of the essential nature of the shelter provided by houses and other accommodation, real property is no longer a good indicator of wealth, though some relationship may exist between annual income and the value of the premises occupied. . . . in the opinion of most authorities in public finance the value of land and buildings i s admittedly neither the sole nor the best test of a b i l i t y to pay.29 Bonbright concluded Certainly the a b i l i t y to pay doctrine can no longer be ad duced in support of a discriminatory burden on realty. Whatever force there may have once been in the argument that the total wealth of individuals corresponds roughly to the values of their houses and lots, has disappeared with changing economic conditions. I f a real estate tax can be defended i t must be on other grounds.^ Where the a b i l i t y to pay principle i s appropriate, discussion on the second problem has been concerned with the relationship between 31 the taxpayer's a b i l i t y and his l i a b i l i t y to tax. Due considers the 29 E.H. Spengler. "The Property Tax as a Benefit Tax" Pro  perty Taxes (New York: 1940), reprinted in H.M. Groves (ed.) Viewpoints  on Public Finance (New York: Henry Holt and Co., 1947), p. 47. 3 0 J.C. Bonbright. op. c i t . , p. 509. 31 J.F. Due. op. c i t . _ p. 113. 18. p o s s i b i l i t i e s of progressive, proportional and regressive relationships between income (or wealth) and tax; together with their underlying p r i n  ciples of equal s a c r i f i c e , proportional s a c r i f i c e and minimum aggregate s a c r i f i c e . Since the a b i l i t y to pay p r i n c i p l e i s not applicable to the r e a l property tax they need not be considered here. The p r i n c i p l e of benefits received, bears more relevance to the r e a l property tax than the a b i l i t y to pay p r i n c i p l e . In outline i t requires that the taxpayer should pay taxes that bear some relationship to the benefits received from the services provided out of those taxes. There are a number of sub-theories involved i n this p r i n c i p l e of taxa tion and without.them the benefits received p r i n c i p l e f a i l s to provide an adequate basis of taxation. The benefits concerned can be measured from the taxpayers' viewpoint i n which event the tax payment could be equal to the benefit accruing to the taxpayer as a r e s u l t of public services, i n money terms; or i t could be in'-terms of the taxpayer's opportunity cost, the amount he would have to spend on those services i f they were not provided by the State. In,these cases however the revenue to the State would be greater than i t s . expenditure on the services concerned, ( i f this were not so therewould be no advantage i n the State's provision of these services), consequently i t could be suggested that the taxpayer's 19. l i a b i l i t y should equal the cost of p r o v i d i n g the s e r v i c e s from which he b e n e f i t s , or a l t e r n a t i v e l y that each taxpayer should bear the burden of that p r o p o r t i o n of the t o t a l cost which i s equal to the p r o p o r t i o n of the t o t a l b e n e f i t which he enjoys. A l l these sub-theories r e q u i r e s u b j e c t i v e e v a l u a t i o n s of the taxpayers' b e n e f i t and w h i l s t t h i s a f f e c t s t h e i r usefulness as accurate measures of l i a b i l i t y to t a x a t i o n i t does not destroy t h e i r - v a l i d i t y as p r i n c i p l e s on which the l i a b i l i t y to t a x a t i o n i s to be e s t a b l i s h e d . The g r e a t e s t amount o f , s u b j e c t i v e e v a l u a t i o n i s r e q u i r e d i n the implementation of the p r i n c i p l e of marginal or incremental b e n e f i t . Buchanan describes i t i n the f o l l o w i n g terms: A p a r t i c u l a r i n d i v i d u a l would be r e q u i r e d to pay a: "tax p r i c e " f o r each u n i t of given p u b l i c s e r v i c e which i s equal to the marginal or incremental b e n e f i t that he r e c e i v e s from a u n i t of t h i s s e r v i c e . T h i s a p p r o p r i a t e l y set "tax p r i c e " would be independent of t o t a l b e n e f i t r e c e i v e d from: a l l u n i t s of the p u b l i c service.. 32 By l i n k i n g _ t h e marginal b e n e f i t and the marginal cost of the s e r v i c e s provided, the optimum qua n t i t y of s e r v i c e could be e s t a b l i s h e d . How ever, Buchanan-agrees t h a t the usefulness of the marginal b e n e f i t theory i s l i m i t e d by the s u b j e c t i v e element i n v o l v e d . . . . When we come to consider r e a l world f i s c a l systems the p r i n c i p l e . . . provides l i t t l e a s s i s t a n c e . D e c i s i o n s as to the t o t a l amount of expenditure and as to the d i s t r i b u t i o n of taxes must be made and p o l i c y makers cannot "read" i n d i  v i d u a l e v a l u a t i o n s of p u b l i c s e r v i c e s . ^ 32 J . Buchanan. The P u b l i c Finances (Homewood, I l l i n o i s : R i c h a r d D. I r w i n , Inc.,1960), Chapter XV. p. 171. J . Buchanan, op. c i t . , p. 172. 20. Another d i f f i c u l t y e x i s t s i n the use of any of the b e n e f i t taxes. I t i s g e n e r a l l y agreed that a tax,, as d i s t i n g u i s h e d from a fee 34 or p r i c e i s a payment f o r i n d i s c r i m i n a t e b e n e f i t s . I f t h i s i s so, the v a l i d i t y of the b e n e f i t p r i n c i p l e must be r e s t r i c t e d to those cases i n which the e f f e c t s of p u b l i c s e r v i c e s can be recognized ( f o r example through increased values r e s u l t i n g from gov ernment s e r v i c e s ) . T h i s must apply to the t o t a l i t y of p u b l i c s e r v i c e s since i f a charge i s l e v i e d i n respect of a p a r t i c u l a r s e r v i c e , the b e n e f i t s of which are r e c o g n i s a b l e , i t should be considered a fee or p r i c e and not a tax. Spengler comments A compulsory . c o n t r i b u t i o n may be r e q u i r e d by the Government from c e r t a i n i n d i v i d u a l s or groups f o r d e f r a y i n g the general costs of p u b l i c s e r v i c e s i n exchange f o r which the taxpayer  i s guaranteed no s p e c i f i c r e t u r n ; yet the handling of such revenues may be so d i r e c t e d that c e r t a i n b e n e f i t s are c l e a r l y t r a c e a b l e to the taxpayers i n question. When such i s the case the tax i s e v i d e n t l y a general revenue device which p a r t l y because of p u b l i c p o l i c y and p a r t l y f o r convenience i n ad m i n i s t r a t i o n has been s u b s t i t u t e d f o r a more complicated s e r i e s of s p e c i a l fees or p r i c e s . . . . Such revenues are not taxes i n the "pure" sense but are h y b r i d or " q u a s i - t a x " measures conforming i n general to the d e f i n i t i o n of a tax but i n c l u d i n g c e r t a i n f e a t u r e s of the a d m i n i s t r a t i v e fee or p u b l i c p r i c e . I n t h i s category belongs the s o - c a l l e d "bene f i t tax".35 I n both Canada and the U nited Kingdom the b e n e f i t s r e c e i v e d from s e r v i c e s provided out of the r e a l property tax are not " c l e a r l y t r a c e a b l e to the taxpayers i n question". 34 Report of the Royal Commission on Finance and M u n i c i p a l  T axation i n New Brunswick, op. c i t . , p. 213; H.A. Silverman, op.  c i t . , p. 66; E.H. Spengler. op. c i t . , pp. 44-45. E.H. Spengler. op. c i t . , p. 46. 2 1 . C e r t a i n b e n e f i t s may be so t r a c e a b l e , such as the use of the p u b l i c l i b r a r y , but not so the b e n e f i t r e c e i v e d from the t o t a l i t y of m u n i c i p a l s e r v i c e s , a n d . i t i s that w i t h which we are concerned. The i n d i v i d u a l taxpayer w i l l b e n e f i t from paved and l i t s t r e e t s p a t r o l l e d by p o l i c e and safeguarded by the f i r e brigade but the extent to which he b e n e f i t s i s indeterminate. The value of r e a l e s t a t e does not provide a measure of those b e n e f i t s . I t i s l e v i e d only on those i n h a b i t a n t s who own (or occupy) r e a l e s t a t e , arid even then there i s no r e l a t i o n s h i p between property values and b e n e f i t s r e c e i v e d . An o l d timber framed house may have the same value as a modern b r i c k - b u i l t residence yet be a s u b s t a n t i a l f i r e hazard. I f the former i s i n h a b i t e d by a l a r g e poor f a m i l y r e l y i n g on p u b l i c f a c i l i t i e s w h i l s t the l a t t e r i s occupied by a c h i l d l e s s . c o u p l e who spend most of t h e i r time out of the m u n i c i p a l  i t y the discrepancy i s apparent. Only i n one way can the value of property be used to estimate the b e n e f i t s a c c r u i n g to i t , and that i s by c o n s i d e r i n g the d i f f e r e n c e s i n value that would e x i s t i f the p u b l i c s e r i v c e s were.'.not provided. This would be as h y p o t h e t i c a l and subjec t i v e an e v a l u a t i o n as an attempt to estimate d i r e c t l y the b e n e f i t s r e  ceived. Thus although the r e a l property tax i s l e v i e d i n respect of b e n e f i t s r e c e i v e d , those b e n e f i t s are indeterminate and i n d i s c r i m i n a t e . Spengler, who considers the r e a l property tax an " i n rem l e v y " and 22. t h a t b e n e f i t s should 'be thought of p r i m a r i l y i n terms of advantages 36 to the property taxed" concludes I t i s v i t a l to recognize that the broad c o l l e c t i v e i n t e r e s t w i t h respect to such s e r v i c e s i s paramount, even though i n some instances there i s present a c l e a r element of i n d i v i d u a l b e n e f i t . I n other words, the p r i n c i p l e of t a x a t i o n should be r e t a i n e d even though i t i s a " b e n e f i t t a x " . 3 ? Thus the use of the r e a l property tax i s founded n e i t h e r on the p r i n c i p l e of a b i l i t y to pay nor on that of b e n e f i t s r e c e i v e d , but 38 depends on expediency and p r a c t i c a l c o n s i d e r a t i o n s . I t provides the m u n i c i p a l i t y w i t h a form of revenue which i s p a r t i c u l a r l y l o c a l i n ch a r a c t e r , easy to administer (once assessments have been made), r e l a - 39 t i v e l y s t a b l e and d i f f i c u l t to evade. Since the r e a l property tax i s based on the p r i n c i p l e s of ex pediency and p r a c t i c a l i t y , the c r i t e r i o n by which "equals" are to be judged cannot be dependent on the p r i n c i p l e s of a b i l i t y to pay or bene f i t s r e c e i v e d , and the r e l a t i o n s h i p between "unequals" w i l l not be de termined b y c t h e i r a b i l i t y to pay nor by the b e n e f i t s they r e c e i v e . I n  stead the determination of "equals" must be l e f t at the d i s c r e t i o n of the l e g i s l a t o r s and once the d e c i s i o n has been made equals can only be 36 E.H. Spengler, op. c i t . , p. 47. 3 7 I b i d . , p. 48. 38 M.A. Cameron. Property Taxation and School Finance i n  Canada. (Toronto: Canada and Newfoundland Education A s s o c i a t i o n , 1945), pp. 20-21. 3 9 J.R. H i c k s , U.K. Hicks and C.E.V. Les e r , The Problem of  V a l u a t i o n f o r R a t i n g . N a t i o n a l I n s t i t u t e of Economic and S o c i a l Research. Occasional Paper No. 7. (London: Cambridge U n i v e r s i t y P r e s s , 1944), pp. 6-11. 23. discovered by reference to t h e i r expressed i n t e n t i o n s and we must there f o r e , adopt s o l e l y that c r i t e r i o n of e q u a l i t y that i s s p e c i f i e d i n the l e g i s l a t i o n . I n the case of the r e a l property tax the b a s i s of assess ment i s g e n e r a l l y the "value" of property, and so i n d i v i d u a l s w i t h r e a l e s t a te of s i m i l a r "values" should bear s i m i l a r taxes, and the l i a b i l i t y to tax should be i n d i r e c t p r o p o r t i o n to the "value" of the r e a l property. Thus, e q u a l i t y of treatment w i l l be achieved whenever each i n d i v i d u a l i s taxed, i n respect of the "value"-(as d e f i n e d i n the Statute) of the property he owns. E q u a l i t y w i l l s t i l l be achieved i f each i n  d i v i d u a l i s taxed on a constant percentage of the "value" of h i s pro p e r t y s i n c e e q u a l i t y of treatment i s concerned only w i t h the r e l a t i o n  ship between taxpayers. I f the r e l a t i o n s h i p between taxpayers i s the same as t h a t which would r e s u l t from compliance w i t h the S t a t u t o r y requirements e q u a l i t y of treatment w i l l be achieved. I n order to maintain i t , u n i f o r m i t y of assessment i s r e q u i r e d . However, u n i f o r m i t y w i l l not of i t s e l f produce e q u a l i t y . According to the d e c i s i o n s of the Courts and Lands T r i b u n a l i n the United Kingdom, u n i f o r m i t y means ( i ) a l l r a t e a b l e hereditaments (assessable p r o p e r t i e s ) d e a l t w i t h should be assessed by reference to values c u r r e n t at the same time; ( i i ) a separate and proper v a l u a t i o n should be made of each i n d i v i d u a l hereditament; and ( i i i ) the same e v i  dence or kinds of evidence should be employed i n the v a l u a - .. t i o n of a l l hereditaments of a comparable c l a s s and the same weight should be attached to that evidence i n each case.^O ^ u R a t i n g and Income Tax, op. c i t . , Volume XLV, p. 675. 24. 41 C l a r k and F i n n i s adopt somewhat s i m i l a r d e f i n i t i o n s . U n i f o r m i t y i n accordance w i t h t h i s d e f i n i t i o n w i l l only produce e q u a l i t y of treatment when the date to which the assessor r e f e r s i s t h a t ^ s p e c i f i e d i n the s t a t u t e , or one so c l o s e that no changes i n values have taken place between the two. As mentioned, i t i s the r e l a t i o n s h i p between taxpayers that i s important and once the r e l a t i o n s h i p between the values adopted by the assessor f o r d i f f e r e n t p r o p e r t i e s d i f f e r s from that r e q u i r e d by S t a t u t e i n e q u a l  i t y w i l l r e s u l t . I t i s a l s o e s s e n t i a l t h a t the b a s i s of assessment adopted by the assessor i s t h a t s p e c i f i e d by the S t a t u t e . "Value" has many meanings and the r e s u l t a n t f i g u r e s of proper v a l u a t i o n s of the same property can vary g r e a t l y as a r e s u l t of d i f f e r i n g i n t e r p r e t a t i o n s of "value". The r e a l property tax i s not an " i d e a l " tax but i t s im- 42 p e r f e c t i o n s are outweighed by i t s p r a c t i c a l advantages. . How ever the f a i l u r e to achieve e q u a l i t y of treatment may accentuate i t s i m perfections to the p o i n t where the replacement of the tax becomes d e s i r a b l e . The r e a l property tax tends to be r e g r e s s i v e i n nature 43 (when examined ag a i n s t the a b i l i t y p r i n c i p l e ) since s h e l t e r i s 4-1- C l a r k , O l i v e r , Chappell and Finnis?, "Uniform Assess ments", . op____c_Lt^ 141, 149. 42 H i c k s , Hicks and Leser. op. c i t . , p. 7. 43 Great B r i t a i n . Parliamentary Papers. L o c a l Government  Finance: England and Wales. Cmnd. 2923. (London: H.M.S.O., February 1966), p. 3; Report of the Royal Commission on Taxation, op. c i t . , Volume I I . p. 245. 25. an e s s e n t i a l commodity and expenditure on i t s p r o v i s i o n decreases as a percentage of income as income i n c r e a s e s . This i s accentuated by e x i s t i n g i n e q u a l i t i e s of treatment since there i s a tendency among asses sors to undervalue the more expensive p r o p e r t i e s r e l a t i v e to the l e s s 44 expensive. I n many cases exemptions from the r e a l property tax are gran ted, and these are granted f o r v a r i o u s reasons and favour one c l a s s of 45 property owner to the detriment of the others. The a b i l i t y to grant exemptions and r e l i e f s should l i e w i t h the l e g i s l a t o r s and not w i t h the assessors, yet de f a c t o r e l i e f s e x i s t as a r e s u l t of the a c t i o n s of the assessors. I t seems reasonable to suppose that i n general the d i s c r i m  i n a t i o n i n the l e v e l s of assessment between d i f f e r e n t c l a s s e s of property i s s u b s t a n t i a l . 4 6 I n the New Brunswick Report the median assessment to s a l e s r a t i o s i n an urban m u n i c i p a l i t y were given as Commercial and I n d u s t r i a l 152, S i n  gle-Family d w e l l i n g s 100, M u l t i - f a m i l y d w e l l i n g s 98, and R e s i d e n t i a l l o t s 76. This d i s c r i m i n a t i o n between c l a s s e s of property i n d i c a t e s extreme i n e q u a l i t y of treatment as between c l a s s e s of taxpayers. The economic e f f e c t s of such d i s c r i m i n a t i o n may be f a r - r e a c h i n g since i t 44 J.C. Bonbright. op. c i t . , p. 490; M.A. Cameron, op. r  c i t . , pp. 23-27; Moore, Guttman and White, op. c i t . , p. 141. 45 Report of the Royal Commission on Finance and M u n i c i p a l Tax  a t i o n i n New Brunswick, op. c i t . , p. 212. 4 6 I b i d . , p. 227. 26. w i l l i n f l u e n c e demand of competing uses f o r land w i t h i n the m u n i c i p a l i t y and w i l l a f f e c t the l o c a t i o n of any p a r t i c u l a r land-use where the ex tent of the d i s c r i m i n a t i o n d i f f e r s between m u n i c i p a l i t i e s . Thus i t can a f f e c t the land use p a t t e r n w i t h i n the m u n i c i p a l i t y and the province, as w e l l as the burden of t a x a t i o n borne by d i f f e r e n t c l a s s e s of tax payer. I n c o n c l u s i o n the r e a l property tax i s i n h e r e n t l y an imper f e c t tax. E q u a l i t y of treatment cannot be defined without reference to the p r o v i s i o n s of the s t a t u t e . Departure from those p r o v i s i o n s has both moral and m a t e r i a l i m p l i c a t i o n s since the economic e f f e c t s of i n c o r r e c t assessments w i l l be i n d i s c r i m i n a t e but f a r - r e a c h i n g . 27. CHAPTER I I BASES OF ASSESSMENT We have seen that w i t h a r e a l property tax, e q u a l i t y of t r e a t  ment can only be achieved by reference to the p r o v i s i o n s of the t a x i n g S t a t u t e . G e n e r a l l y , the b a s i s of assessment I s stat e d to be the "value" of the property and i n some cases i t i s q u a l i f i e d by the use of such 1 words as " a c t u a l " , " f a i r " or " r e a l " . This q u a l i f i c a t i o n does not en able the i n t e n t i o n s of the l e g i s l a t o r s to be c l e a r l y i n t e r p r e t e d since 2 "value" alone, i s an extremely vague term and capable of many meanings. The word ' a c t u a l ' , ' f a i r ' or ' r e a l ' add l i t t l e t o the understanding of value and i n one case i t has been sta t e d that " " a c t u a l v a l u e " , " f a i r market value " and " a c t u a l cash v a l u e " are synonymous terms meaning r e - 3 l a t i v e l y the same t h i n g . " I n order t h a t the i n t e n t i o n s of the l e g i s l a t o r s should be c l e a r l y understood the p o s s i b l e bases of assessment that can be adopted 4 w i l l be considered. Since the incidence of the tax w i l l d i f f e r w i t h 1 F.H. F i n n i s . "Real P r o p e r t y Assessment i n Canada" op. c i t . , p. 16; K.G. Crawford. Canadian M u n i c i p a l Government. (Toronto: U n i  v e r s i t y of Toronto P r e s s , 1954), pp. 279-280. 2 J.C. Bonbright. op. c i t . , Chapter I I ; P.F. Wendt. Real  E s t a t e A p p r a i s a l . (New York: Henry.Holt & Co., 1956), Chapters I & I I . 3 Wootton J . i n Re Rowan's Appeal (1962) 40 W.W.R. 627, 628-629. 4 See J.C. Bonbright op. c i t . , pp. 3-97, and Chapter XVII. A l s o R.U. R a t c l i f f . Modern Real E s t a t e V a l u a t i o n (Madison, W i s e : Democrat P r e s s , 1965), Chapter I I I . 28. 5 the adoption of d i f f e r e n t bases of assessment i t i s important that the b a s i s of assessment r e q u i r e d by the l e g i s l a t u r e be used by the assessor i f i n e q u a l i t y of treatment i s to be avoided. a) Value i s not P r i c e . A f i g u r e of value i s the amount f o r which a piece of property would be expected to change hands. I t i s an e s t i m a t i o n and not a h i s  t o r i c f a c t ; and as an e s t i m a t i o n r e q u i r e s that c e r t a i n assumptions be made as to the c o n d i t i o n s of the t r a n s a c t i o n . The f i n a l f i g u r e of value w i l l depend on the assumptions made. P r i c e , however, i s the r e s u l t of an accomplished t r a n s a c t i o n and i n t h i s case the amount f o r which the property has changed hands i s an e s t a b l i s h e d f a c t . The c o n d i t i o n s of the s a l e are determinate and although there may be d i f f i c u l t i e s i n i d e n t i f y i n g the a c t u a l condi t i o n s no f u r t h e r assumptions can be made regarding them. When market value i s being found an estimate i s made of the p r i c e that would be obtained f o r the property. I n some cases however, the circumstances as they e x i s t i n the market are not presumed but an assumption i s made as to c o n d i t i o n s which might e x i s t i n a h y p o t h e t i c a l 6 market. I n t h i s d i s s e r t a t i o n the term 'market value' w i l l be i n t e r p r e - ~" ~* Report of the Royal Commission on Finance and M u n i c i p a l Taxation i n New Brunswick, op. c i t . , p. 207. R.U. R a t c l i f f . A Restatement of A p p r a i s a l Theory. Wis consin Ccnnmerce Reports V o l . V I I , No. 1 (Madison: The U n i v e r s i t y of Wisconsin, School of Commerce, 1963), pp. 35-37. 2 9 . ted to mean the f i g u r e of value at which an informed observer of the market would expect a piece of property to change hands under the con d i t i o n s of the a c t u a l market f o r that type of property. Those condi t i o n s would be e s t a b l i s h e d by reference to the r e p r e s e n t a t i v e transac t i o n . Since value i s an estimate, the determination of the represen t a t i v e t r a n s a c t i o n and the appropriate c o n d i t i o n s w i l l be made by the v a l u e r . Where the market i s l a r g e the .'conditions of the representa t i v e t r a n s a c t i o n should be r e a d i l y apparent. However where they are not, they must be presumed. The market i n r e a l estate i s not p e r f e c t ( i n the economic sense) and consequently the c o n d i t i o n s of each s a l e may be d i f f e r e n t . Which w i l l be the r e p r e s e n t a t i v e t r a n s a c t i o n w i l l depend on the v a l u e r ' s o p i n i o n of the market. Therefore "market v a l u e " and p r i c e would correspond where the l a t t e r was the r e s u l t of the r e p r e s e n t a t i v e t r a n s a c t i o n . However where the t r a n s a c t i o n was not r e p r e s e n t a t i v e , f o r example where the purchaser was p a r t i c u l a r l y knowledgeable and the s e l l e r p a r t i c u l a r l y g u l l i b l e , the price-might be expected to d i f f e r from the market value. Thus depending on the c o n d i t i o n s of the t r a n s a c t i o n p r i c e may be above, below or equal to value. As bases of assessment both p r i c e and value can be adopted. A ' p r i c e ' b a s i s of assessment would r e s u l t i n the assessment of each property a t i t s l a s t s a l e (or l e t t i n g ) p r i c e , w h i l s t a 'value' b a s i s of assessment would r e s u l t i n assessments at f i g u r e s at which the pro p e r t i e s would be expected to s e l l or l e t . 30. The ' p r i c e ' b a s i s of assessment would remove s u b j e c t i v e es tim a t i o n s from the a s s e s s i n g procedure though i t would r e q u i r e proof of s a l e (or l e t t i n g ) p r i c e s and might r e s u l t i n m i s r e p r e s e n t a t i o n i n conveyances f o r the. purpose of evading t a x a t i o n . The ' p r i c e ' b a s i s of assessment has two major disadvantages which render i t u n s u i t a b l e as a b a s i s of assessment on the grounds that i t does not produce u n i f o r m i t y of assessment. F i r s t l y i n a p e r i o d of changing v a l u e s , property assessments w i l l depend on the time at which the property l a s t changed hands. The r e l a t i v e gains and l o s s e s w i l l be d i s c r i m i n a t o r y and random. Secondly since some p r i c e s ( a t any p o i n t i n time) can be expected to d i f f e r from v a l u e as the r e s u l t of d i f f e r e n t c o n d i t i o n s of s a l e , so the assessments of s i m i l a r p r o p e r t i e s s o l d a t the same time can be expected to d i f f e r . I f the property has not yet been so l d or l e t , some other b a s i s of assessment would have to be adopted. b) Value to the Owner. Another v a l u e concept i s value to the owner and f o r t h i s an estimate i s made of the worth of the property to a p a r t i c u l a r person. This i s a very s u b j e c t i v e concept and i s incapable of accurate v e r i  f i c a t i o n . When a property changes hands the v a l u e to s e l l e r i s l e s s than the s a l e p r i c e w h i l s t the value to the purchaser i s greater but 7 the amount by which they d i f f e r from s a l e p r i c e i s immeasurable. 1 c- £- R- Purvey, op. c i t . , pp. 8-21. 3 1 . Bonbright a f t e r d i s c u s s i n g the concept of value to the owner concludes Whenever "value" i s not i d e n t i f i e d w i t h market value (or w i t h some h y p o t h e t i c a l market value l i k e " j u s t i f i e d s e l l i n g p r i c e " ) i t p r o p e r l y r e f e r s to the value of the property to some s p e c i f i c person or group of persons. The same property would have very d i f f e r e n t values to d i f f e r e n t i n d i v i d u a l s , . . . Value to the owner i s g e n e r a l l y measured i n terms of money, and i s then set by the amount of money that would j u s t compensate the owner f o r the l o s s of the property.8 The s u b j e c t i v i t y of t h i s concept makes i t an u n s u i t a b l e b a s i s of assessment and i t i s r a r e l y used. The term 'value' i n t a x i n g A c t s i s understood to mean market value. The estimate of market value may however, be i n f l u e n c e d by t h i s concept where the present owner i s the only l i k e l y purchaser of the property. c) The Assumptions of Market Value. Market value has many i n t e r p r e t a t i o n s depending on the as sumptions made about the c o n d i t i o n s of market; but they can be d i v i d e d i n t o two c a t e g o r i e s , market value where the c o n d i t i o n s of the a c t u a l market are i m p l i e d and value i n a market where h y p o t h e t i c a l c o n d i t i o n s apply. As mentioned e a r l i e r , market value (under a c t u a l market con d i t i o n s ) i s an estimate of the p r i c e r e a l i s e d i n the r e p r e s e n t a t i v e t r a n s a c t i o n . I t i s necessary f o r the date to be s p e c i f i e d and th a t 8 J.C. Bonbright. op. c i t . , Chapter IV, p. 92. 32. can be i n the past, present or f u t u r e . I n each case the market condi t i o n s must be those that e x i s t at the appropriate time. Where a f u  ture (market) value has been estimated but the market c o n d i t i o n s at the r e l e v a n t date do not match those assumed, the v a l u a t i o n w i l l f a l l i n t o the second c l a s s . Due to changes i n the property market and the d i f  f i c u l t y of f o r e c a s t i n g them, the e s t i m a t i o n of a f u t u r e v a l u e i s b e t t e r considered to be a v a l u a t i o n under c o n d i t i o n s of a h y p o t h e t i c a l market u n t i l proved by events to be a t r u l y market value. The h y p o t h e t i c a l c o n d i t i o n s can vary w i d e l y and the d e f i n i t i o n of market value used by the American I n s t i t u t e of Real Es t a t e A p p r a i s e r s i s an example: (1) As d e f i n e d by the c o u r t s , i s the highest p r i c e estimated i n terms of money -which a property w i l l b r i n g i f exposed f o r s a l e i n the open market a l l o w i n g a reasonable time to f i n d a purchaser who buys w i t h the knowledge of a l l the uses to which i t i s adapted and f o r which i t i s capable of being used. (2) Frequently i t i s r e f e r r e d to as the p r i c e at which a w i l l i n g s e l l e r would s e l l and a w i l l i n g buyer would buy n e i t h e r being under abnormal pressure. (3) I t i s the p r i c e expectable i f a reasonable time i s allowed to f i n d a purchaser and i f both s e l l e r and p r o s p e c t i v e buyer are f u l  l y informed. 9 R a t c l i f f suggests i t " r e q u i r e s that the appraiser accept an unreal h y p o t h e t i c a l s i t u a t i o n i n which there i s but one buyer, one s e l l e r and 10 one property." Another example of a h y p o t h e t i c a l market i s apparent i n the 11 Rent A c t 1965 which i n s p e c i f y i n g the meaning of a " f a i r r e n t " under a regulated tenancy s t a t e s ~" 9 R.U. R a t c l i f f . A Restatement of A p p r a i s a l Theory, l o c . c i t . 1 0 I_DJ_d. 1 1 E l i z . 2 1965. c. 75. s. 27. 33. (1) . . . regard s h a l l be had . . . to a l l the circumstances . . . and i n p a r t i c u l a r to the age, character and l o c a l i t y of the dwellinghouse and i t s s t a t e of r e p a i r . (2) . . . i t s h a l l be assumed that the number of persons seeking to become tenants of s i m i l a r dwellinghouses . . . i s not s u b s t a n t i a l l y greater than the number of such d w e l l i n g - houses i n the l o c a l i t y which are a v a i l a b l e f o r l e t t i n g , on such terms. (3) There s h a l l be disregarded:- (a) any d i s r e p a i r . . . a t t r i b u t a b l e to a f a i l u r e by the tenant . . . to comply w i t h any terms . . . (of the tenancy) and (b) any improvement . . . c a r r i e d out by the tenant. Although t h i s p r o v i s i o n does not r e f e r to the r e a l property tax i t i n d i c a t e s how c o n d i t i o n s u n r e l a t e d to those e x i s t i n g i n the ac t u a l market can be r e q u i r e d to be considered. Another concept of market value which depends on h y p o t h e t i - 12 c a l c o n d i t i o n s i s known as Normal Value. I t takes value to be i n the form of a trend over a p e r i o d of time. We have seen that at any p o i n t i n time p r i c e s can be expected to range around market value and where the concept of normal value i s adopted i t i s expected that p r i c e s over a p e r i o d of time w i l l range around normal value. The e s t i m a t i o n of normal val u e w i l l be d i f f i c u l t since the p e r i o d of time i n v o l v e d must be considered; and i t i s on t h i s ground that Bonbright 13 has advised against i t s use. Another concept of v a l u e , i n t r i n s i c v a l u e , i s an e n t i r e l y h y p o t h e t i c a l concept being endowed w i t h some of the n o t i o n s of the 12 H i c k s , Hicks and Leser. op. c i t . , p. 8.; J.C. Bonbright. op. c i t . , p. 29. 1 3 Gf. J.C. Bonbright. op. c i t . , p. 471. 34. 14 mediaeval ' j u s t p r i c e ' since i t i s concerned not w i t h what the pro- 15 perty w i l l s e l l f o r but what i t should s e l l f o r . As such i t i s an extremely s u b j e c t i v e f i g u r e of value. The concepts of value considered i n t h i s s e c t i o n have been forms of market valu e i n which there have been d i f f e r e n c e s i n the as sumed market c o n d i t i o n s . I n some cases an attempt w i l l be made to estimate market values by the use of i r r e l e v a n t f a c t o r s and the r e s u l  tant f i g u r e w i l l be a h y p o t h e t i c a l value and not a f i g u r e of value under h y p o t h e t i c a l market c o n d i t i o n s . For example i n Japan a f t e r the war the f o l l o w i n g b a s i s of assessment was reccimmended. The prewar r e n t a l values now on the ledgers should be mul t i p l i e d by 200 . . . The r e s u l t i s a rough estimate of r e n t a l values i n 1949 terms — h y p o t h e t i c a l free-market ren t a l v a l u e s , not the r e n t a l s a c t u a l l y r e c e i v e d under r e n t c o n t r o l . This r e s u l t should then be m u l t i p l i e d by 5 to put the estimate on a c a p i t a l value b a s i s . The r e s u l t i s a crude approximation of what the asset might be worth i f i t could be s o l d i n a f r e e market, or of what i t would cost to r e  produce the s t r u c t u r e ( a f t e r a l l o w i n g f o r wear and t e a r ) . ^ I n choosing between an assumption of market c o n d i t i o n s and one of h y p o t h e t i c a l c o n d i t i o n s the l e g i s l a t o r s w i l l be guided by p o l i t i c a l c o n s i d e r a t i o n s . Consequently they can use the p o s s i b l e v a r i e t y of h y p o t h e t i c a l c o n d i t i o n s to create the tax s t r u c t u r e they deem d e s i r a b l e . — Joan Robinson. Economic Philosophy (London: C.A. Watts, 1962), Chapter I I , p. 26.; R.U. R a t c l i f f . Modern Real E s t a t e V a l u  a t i o n , op. c i t . , pp. 45-51. 1 5 J.C. Bonbright. op. c i t . , p. 27. 16 Report on Japanese Taxation by the Shoup M i s s i o n (Tokyo: G.H.Q., Supreme Ccmmiander f o r the A l l i e d Powers, 1949) V o l . I I , p. 193. 35. However, where cur r e n t market c o n d i t i o n s are to be assumed the assessments can be r e a d i l y checked by comparisons w i t h recent s a l e s , which are the best evidence of market value. As mentioned p r i c e need not equal market v a l u e but i f no p e c u l i a r i t i e s can be d i s  covered (such as i n t e r - f a m i l y t r a n s a c t i o n s , etc.) then p r i c e can be expected to approximate market value. As mentioned p r e v i o u s l y , i f the c o n d i t i o n s of the s a l e are the same as those of the representa t i v e t r a n s a c t i o n , p r i c e and value are the same. However, the c o n d i t i o n s of the t r a n s a c t i o n are not always i d e n t i f i a b l e and so i t w i l l be unjus t i f i a b l e to assume that p r i c e and value are always i d e n t i c a l . I t may however be r e a l i s t i c to assume that the c o n d i t i o n s of many of the market t r a n s a c t i o n s are not f a r removed from those of the r e p r e s e n t a t i v e t r a n s a c t i o n and t h e r e f o r e that p r i c e approximates market value. A market value b a s i s of assessment w i l l be r e a d i l y understandable to the taxpayers and the a b i l i t y to check assessments w i l l remove much of the e x i s t i n g apathy toward assessments and ignorance of assessment 17 teachniques. I t w i l l a l s o enable a more o b j e c t i v e a u d i t to be made of the q u a l i t y of assessment (through the use of assessment-sales r a t i o 18 s t u d i e s ) and t h i s should r e s u l t i n greater e q u a l i t y of treatment. d) E x i s t i n g Use Values and Values i n Exchange. I n e s t a b l i s h i n g the tax s t r u c t u r e the l e g i s l a t o r s have a 19 f u r t h e r choice between e x i s t i n g use values and values i n exchange. 1/ H.L. L u t z , P u b l i c Finance (Fourth E d i t i o n , New York, D. Appleton-Century Co., Inc.,1947) pp. 392/393. Moore, Guttman and White, op. c i t . , p. 95; P.H. White "Concepts of Assessment Value" Report of the 1963 Conference (Toronto: Canadian Tax Foundation, 1964), p. 109, 113-114. 19 These terms are not to be confused w i t h the c l a s s i c i a l eco nomic concepts of "value i n use" and "value i n exchange". 36. E x i s t i n g use values are those f i g u r e s of value which are appropriate i f the use of the property i s r e s t r i c t e d to i t s e x i s t i n g use w h i l s t values i n exchange are those which r e s u l t i f the use were not r e s t r i c t e d to that now e x i s t i n g . Where the property i s i n i t s highest and best use there w i l l be no d i f f e r e n c e between the two, but where the use could be p r o f i t a b l y changed, val u e i n exchange w i l l exceed value i n use. I f i n every v a l u a t i o n the existence of l e s s e r i n t e r e s t s and other en cumbrances i s ignored, e x i s t i n g use value w i l l be the lowest l i m i t of value i n exchange i n a l l cases. C l e a r l y the incidence of the tax w i l l change between the two bases of assessment s i n c e developable p r o p e r t i e s w i l l b e n e f i t ( r e l a  t i v e l y ) when e x i s t i n g use values are employed. I f values i n exchange were used u n r e a l i z e d gains would f a l l to be taxed since i n c r e a s i n g property values are not obtained u n t i l the property i s s o l d . Thus, the i n e f f i c i e n t use of land i s p e n a l i s e d by the use of values i n exchange and there w i l l be a tendency f o r e a r l i e r development than i f e x i s t i n g 20 use values were adopted. Furthermore the e x i s t i n g use value w i l l , when i t d i f f e r s from the value i n exchange, be a value under c o n d i t i o n s of a hypothe t i c a l market and w i l l consequently have the disadvantages of such. " 20 R. Turvey. op. c i t . , Chapter V I I . 37. e) R e n t a l Values or C a p i t a l Values. I n Canada the r e a l property tax i s g e n e r a l l y l e v i e d on c a p i t a l values w h i l s t i n the United Kingdom i t i s l e v i e d on the r e n t a l values of r e a l e s t a t e . The choice between these two w i l l depend on whether market values or values under the c o n d i t i o n s of a h y p o t h e t i c a l market are to be adopted, and whether the tax i s to be l e v i e d on values i n exchange or on e x i s t i n g use val u e s . I t w i l l not depend on whether the tax i s to be l e v i e d on the owner or the occupier. The employment of market values permits the use of market data as d i r e c t evidence of c o r r e c t assessments and consequently i t i s r a t i o n a l to adopt that form of value ,evidence of which i s most r e a d i l y a v a i l a b l e . L o g i c would suggest that i f the market place i s to provide evidence of va l u e , then assessments based on value i n ex change should be made by reference to c a p i t a l v a l u e s ; where as i f value i n use i s the desideratum r e n t a l values ought to be used.21 Rents t a k i n g i n t o account the redevelopment p o t e n t i a l (such as b u i l d i n g leases) do e x i s t and i t would be p o s s i b l e to make value i n exchange assessments based on r e n t a l values. However c a p i t a l value t r a n s a c t i o n s g e n e r a l l y take i n t o account a l l development p o t e n t i a l i t i e s 7 1 P.H. White, op. c i t . , p. 1 1 1 . 38. (except where l e g a l p r o v i s i o n s p r o h i b i t redevelopment) and on p r a c t i  c a l grounds, s i n c e the m a j o r i t y of leases ignore (or prevent) r e d e v e l - 22 opment e x i s t i n g use values are best i l l u s t r a t e d by means of r e n t a l v a l u e s , and values i n exchange by c a p i t a l v alues. I n choosing between c a p i t a l and r e n t a l values both the number and average s i z e of t r a n s a c t i o n ought to be considered, since the grea t e r the evidence of market value that i s a v a i l a b l e the more accurate should be the assessments. Where h y p o t h e t i c a l market c o n d i t i o n s are to be presumed the s i g n i f i c a n c e of market evidence may be l i m i t e d , and consequently the relevance of r e n t a l and c a p i t a l values to e x i s t i n g use values and values i n exchange, r e s p e c t i v e l y , w i l l be of l e s s importance. f ) . Date of V a l u a t i o n . I n s e l e c t i n g the b a s i s of assessment, a t t e n t i o n should be pa i d to the date to which a l l p r o p e r t i e s are to be valued. The date of va l u a  t i o n need not be that a t which the v a l u a t i o n i s made but should be spe c i f i e d i n order to ensure that the same assumptions are made when as sessing d i f f e r e n t p r o p e r t i e s and that u n i f o r m i t y and e q u a l i t y of t r e a t  ment i s achieved. 22 J.E. Smyth and D.A. Soberman. The Law and Business Admin  i s t r a t i o n i n Canada. (Toronto: P r e n t i c e - H a l l of Canada L t d . , 1965), p. 403. 39. Where the values of d i f f e r e n t p r o p e r t i e s have a l t e r e d over a per i o d of time, but not unif o r m l y , the choice of date of v a l u a t i o n w i l l a f f e c t the l i a b i l i t y to the tax. Thus i f i n a p e r i o d of i n f l a t i o n Black- acre's market value has t r e b l e d , w h i l s t Whiteacre has doubled i n value over the same p e r i o d , then Blackacre w i l l bear 507. more tax r e l a t i v e to Whiteacre, i f an end-of-period date i s used, than i f a s t a r t - o f - p e r i o d date of v a l u a t i o n i s adopted. This w i l l be true f o r a l l market valu e bases of assessment or f o r values under c o n d i t i o n s of a hypothe t i c a l market. C l e a r l y i n e q u a l i t y of treatment w i l l r e s u l t i f the assessor adopts a date of v a l u a t i o n other than that r e q u i r e d by Statute i f 23 there have been changes i n r e l a t i v e values between the two dates. I f only changes i n the general l e v e l of values have occurred so that the r e l a t i o n s h i p s between values remain u n a l t e r e d , the assessments w i l l be wrong but w i l l not r e s u l t i n i n e q u a l i t y of treatment. I f the l e g i s l a t o r s adopt h i s t o r i c (or future) values r a t h e r than c u r r e n t v a l u e s , they have a choice between assess i n g each property as i t stood a t the date of v a l u a t i o n or assess i n g i t w i t h reference to c o n d i t i o n s that e x i s t e d a t another time (such as present c o n d i t i o n s ) but using the l e v e l s of value that were cur r e n t at the date of v a l u a t i o n . Thus, i f mid-1939 i s accepted as the date of v a l u a t i o n , i t should be 2 3 U.K. Hicks. P u b l i c Finance, op. c i t . , pp. 240-241.; Moore, Guttman and White, op. c i t . , p. 96. 40. s p e c i f i e d whether changes i n circumstances (such as the a d d i t i o n of an e x t r a room, or the increased p o p u l a r i t y of the neighbourhood) should 24 be considered, and i f so, w i t h relevance to what date. Only i f the circumstances are r e l e v a n t to the date of v a l u a  t i o n can the f i g u r e of value be market value and i t w i l l be v e r i f i a b l e by reference to p r i c e s r e l e v a n t at that time. I n other cases i t would be a value under h y p o t h e t i c a l market c o n d i t i o n s and incapable of v e r i  f i c a t i o n i n the a c t u a l market. g) Gost. 25 I n some cases cost has been u t i l i s e d as a measure of value however cost and market value are only i n perpetual equivalence i n a s t a t e 26 of long-run s t a t i c e q u i l i b r i u m . As bases of assessment, cost of c o n s t r u c t i o n or replacement cost could be adopted, though the l a t t e r has i m p l i e d i n i t the l a r g e l y 27 s u b j e c t i v e concept of d e p r e c i a t i o n and i s t h e r e f o r e undesirable as a b a s i s of assessment. 24 F . H . F i n n i s . "Uniform Assessments". op. c i t . , p. 154. 25 J.C. Bonbright. op. c i t . , p. 490.; Report of the Royal  Commission on Finance and M u n i c i p a l Taxation i n New Brunswick, op.  c i t . , pp. 222-223. A l f r e d M a r s h a l l . P r i n c i p l e s of Economics (eighth e d i t i o n , London: Macmillan-.S. Co. L t d . , 1962), p. 305. 27 p.F. Wendt. op. c i t . , Chapter V I I I . 41. Conclusion. Some of the v a r i o u s bases of assessment have been considered and the a l t e r n a t i v e s r e l a t i n g to market values or value under hypothe t i c a l market c o n d i t i o n s were examined. The s t a t u t o r y b a s i s of assessment has g e n e r a l l y been i n t e r  preted to mean curr e n t market value and i f e q u a l i t y of treatment i s to be achieved,assessments i n accordance w i t h t h i s i n t e r p r e t a t i o n ( o r a constant percentage thereof) must be made. I f a percentage of curr e n t market value i s used, or i f an attempt i s made at ac h i e v i n g e q u a l i t y of treatment w h i l s t using another b a s i s of assessment, i t would be d e s i r  able to r e v i s e a l l the e x i s t i n g assessments to accord w i t h s t a t u t o r y requirements, p a r t i c u l a r l y as such v a l u a t i o n s must be made to ensure o v e r a l l e q u a l i t y of treatment. I n some cases the s t a t u t o r y requirements cannot be complied w i t h , e i t h e r as a r e s u l t of inadequate asses s i n g s t a f f or as a conse quence of the time r e q u i r e d f o r r e v a l u a t i o n s when the s t a t u t e r e q u i r e s c u r r e n t values as the b a s i s of assessment. Whenever the r e l a t i o n s h i p between assessments d i f f e r s from that r e q u i r e d by s t a t u t e , i n e q u a l i t y of treatment w i l l r e s u l t . Since the incidence of the r e a l property tax i s indeterminate the e f f e c t of the i n e q u a l i t y w i l l be u n c e r t a i n . Consequently any d e c i s i o n to i n  crease expenditure so as to improve the q u a l i t y of assessment or to rep l a c e the r e a l property tax w i t h another means of r a i s i n g revenue must r e l y on p o l i t i c a l c o n s i d e r a t i o n s . 42. CHAPTER I I I CURRENT LEGAL PROVISIONS FOR THE DETERMINATION OF VALUE A) England and Wales The cur r e n t s t a t u t o r y p r o v i s i o n s r e l a t i n g to the determina t i o n of value f o r r e a l property tax i n England and Wales are contained 1 i n the R a t i n g and V a l u a t i o n A c t 1925, and subsequent l e g i s l a t i o n . D i f f e r e n t p r o v i s i o n s apply f o r Scotland and Northern I r e l a n d and these w i l l be ignored i n t h i s examination of two of the d i s s i m i l a r bases of assessment which have been adopted by separate j u r i s d i c t i o n s . The 1925 l e g i s l a t i o n a p p l i e s to most c l a s s e s of r e a l property, though c e r t a i n u t i l i t y p roperty, r a i l w a y s and canals f a l l o utside i t s 2 general p r o v i s i o n s . A g r i c u l t u r a l land and b u i l d i n g s are exempt from the r e a l pro- 3 p e r t y tax. W h i l s t s p e c i a l p r o v i s i o n s r e l a t e to a g r i c u l t u r a l d w e l l i n g 4 houses. 1 15 and 16 Geo. 5, c. 90. 2 Ryde on R a t i n g , op. c i t . , p. 349. 3 I b i d - 4 I b i d . , p. 428. 43. Property, which i s l i a b l e to the r e a l property tax, and " c o n s i s t s of one or more houses or other n o n - i n d u s t r i a l b u i l d i n g s " 5 etc . i s valued to "gross v a l u e " which i s defined i n S e c t i o n 68: the r e n t at which a hereditament might reasonably be expec ted to l e t from year to year i f the tenant undertook to pay a l l usual tenant's r a t e s and taxes, . . . and i f the l a n d l o r d undertook to bear the cost of the r e p a i r s and insurance and the other expenses, i f any, necessary to maintain the h e r e d i  tament i n a s t a t e to ccmmand that rent.6 The f i g u r e s of gross value are reduced to net r e n t a l terms, 7 by means of a s t a t u t o r y deduction r e p r e s e n t i n g r e p a i r i n g expenses, and are then known as the "net annual v a l u e " of the premises. Property that i s not valued to i t s gross value i s valued d i r e c t l y to i t s "net annual v a l u e " : the r e n t at which the hereditament might reasonably be ex pected to l e t from year to year i f the tenant undertook to pay a l l usual tenant's r a t e s and taxes . . . and to bear the cost of the r e p a i r s and insurance and other expenses, i f any, necessary go maint a i n the hereditament i n a s t a t e to command that r e n t . The d e f i n i t i o n of gross value had been p r e v i o u s l y enacted i n s u b s t a n t i a l l y s i m i l a r form i n the Union Assessment Committee A c t s ^ R a t i n g and"Valuation A c t 1925, Sec. 22 (1) (a) as amended by the R a t i n g and V a l u a t i o n (Miscellaneous P r o v i s i o n s ) A c t 1955 and R a t i n g and V a l u a t i o n A c t 1961. I b i d . , S e c t i o n 68 (1) as amended by the T i t h e A c t 1936 and R a t i n g and V a l u a t i o n A c t 1961. ? R a t i n g and V a l u a t i o n A c t 1925, 2nd schedule, P a r t I as amended by the R a t i n g and V a l u a t i o n A c t 1961 and The V a l u a t i o n ( S t a   t u t o r y Deductions) Order 1962 ( S . I . 1962, No. 940). g R a t i n g and V a l u a t i o n A ct 1925, Sec. 22 (1) (b) as amended by the T i t h e A c t 1936. 44. 9 10 11 1862 and 1864 and i n the V a l u a t i o n ( M e t r o p o l i s ) A c t 1869. The f i r s t s t a t u t o r y d e f i n i t i o n of "net annual v a l u e " was 12 enacted i n the P a r o c h i a l Assessments A c t 1836 and was of s i m i l a r e f f e c t to that i n the 1925 A c t . These s t a t u t o r y d e f i n i t i o n s are inadequate as unequivocal statements of the b a s i s of assessment and the Courts have c l a r i f i e d and expanded on them. England and Wales -- J u d i c i a l I n t e r p r e t a t i o n The assessor i s to determine the r e n t a l value of the premises, and the p r i c e , or r e n t reserved under an e x i s t i n g l e a s e , i s merely e v i - 14 dence of that r e n t a l v a l u e . I n determining that value he i s to, assume th a t the premises 15 are "vacant and to l e t " and that they are to be l e t on a h y p o t h e t i c a l 9 25 and 26 V i c t . , c. 103, s. 15. 10 27 and 28 V i c t . , c. 39. 11 32 and 33 V i c t . , c. 67, s. 4. 1 2 6 and 7 W i l l . 4., c. 96. 1 3 R. v. Sk i n g l e . (1798) 7 T.R. 549; 101 E.R.1126; Poplar  v. Roberts: A922/ 2 A.C. 93, 119. 1 4 I b i d , and R. v. School Board f o r London. (1886) 17 Q.B.D. 738. See Ryde on R a t i n g , op. c i t . , p. 377 et seq. 1 5 L.C.C v. Churchwardens of E r i t h and West- Ham. _18937 A.C. 562, 588. 45. 16 tenancy to a h y p o t h e t i c a l tenant. The h y p o t h e t i c a l tenant i s to be considered as n e i t h e r a s u p e r l a t i v e l y good occupier nor the worst of 17 occupiers but "a s o r t of average between them", and the e x i s t i n g owner 18 or occupier i s to be included as a p o t e n t i a l tenant. Although the value of the occupation i s to be estimated from 19 the tenant's viewpoint the c r i t e r i o n i s not the value of the occupa t i o n to the e x i s t i n g owner ( i . e . , v a l u e to the owner) but the y e a r l y 20 rent the h y p o t h e t i c a l tenant would be w i l l i n g to pay f o r the premises. The s t a t u t o r y d e f i n i t i o n s p e c i f i e s a l e t t i n g "from year to year" and thus has been contrasted w i t h the assumption that the l e t t i n g 21 i s to be f o r only one year. As Lord Esher expressed i t : * b R. v. West Middlesex Waterworks (1859) 1 E. & E. 716, 722; 120 E.R. 1078, 1081; 28 L.J.M.C. 135, 137; R. v. S h e f f i e l d U nited  G a s l i g h t Co.. (1863) 4 B. & S. 135, 147; 122 E.R. 410, 415; 32 L.J.M.C. 169, 173. 1 7 Cartwright v. Sculcoates Union. /_T90p_7 A.C. 150, 155. I Q R- v- School Board f o r London. (1886) 17 Q.B.D. 738, 740, 741; and L.C.C. v. E r i t h and West Ham. _18937 A.C. 562, 588, 589. 1 9 — — P o p l a r A.C. v. Roberts. _1922/ 2 A.C. 93, 104, 116, 123; and P.L.A. v. A.C. of O r s e t t Union. /_192__7A.C. 273, 288. 20 I b i d , and Robinson Bros. (Brewers) L t d . v. Houghton and  C h e s t e r - l e - S t r e e t A.C. J193V 2 K.B. 445,_476__ and East London R a i l   way J o i n t Co. v. Greenwich Union A.C. . £19131 1 K-B. 612, 620. 21 Great Eastern Railway Co. v. The Overseers of Haughley. (1866__L.R. 1 Q.B. 666, 685; Consett I r o n Co. L t d . v. Durham A.C. /__93_/ A.C. 396, 405. 46. A tenant from year to year i s not a tenant for one, two, three or four years but he is to be considered as a tenant capable of enjoying the property for an indefinite time, having a ten ancy which i t is expected w i l l continue for more than a year but which is liable to be put an end to by notice.22 Such a tenant i s unlikely to consider a l l the possible uses to which the premises could be put but, rather, would occupy them for 23 the purpose for which they are adapted at the start of the tenancy, and i t has long been established that the premises are to be valued as they stand and as used and occupied when the assessment is made (Rebus 24 sic stantibus) together with a l l the natural and statutory privileges, 25 opportunities and d i s a b i l i t i e s . Such a presumption has two connected implications. F i r s t l y that the value to be found i s an existing use value and that potential i t i e s unconnected with the existing use should be ignored. The Legislature intended that the rate should be made upon an estimate of the rent which would be given for the property- rebus sic stantibus. In the case of jvacant ground near a 22 R. y. South Staffordshire Waterworks Co. (1885) 16 Q.B.D. 359, 370; 40. J.P. 20, 21. 2 3 S e e R- v. Mast. (1795) 6 T.R. 154. 101 E.R. 485. _ __4 Great Western & Metropolitan Railway Cos. v. Kensington  A.C. '/1916/ 1 A.C. 23; North & South Western Junction Railway Co.  v. Brentford Union A.C. (1888) 13 App.. Cas. 592, 593-4; Staley v.  Castleton (1864) 5 B. & S. 505; 112 E.R. 920; Cf. Townley M i l l Co. (1919) Ltd. v. Oldham A.C. /T9/377 A.C. 419; 1 A l l E.R. 11. P.L.A. y. A.C. of Orsett Union /1920/ A.C. 273, 305. Cf. Poplar v. Roberts. A 9 2 2 / 2 A.C. 93. 47. l a r g e town, l i k e l y to become b u i l d i n g land, the t e s t of the amount of "the r a t e i s not the r e n t at which i t would l e t f o r a term of years . . . . The higher value which i t may some day a t t a i n would probably be taken i n t o account i n es t i m a t i n g the s e l l i n g p r i c e but cannot be regarded i n es t i m a t i n g the rent on a l e t t i n g from year to year. I f there were a rea sonable prospect t h a t during the current year the hypothe t i c a l tenant would give a higher r e n t , the amount of that r i s e might be taken i n t o account; but deferred and r e v e r s i o n  ary prospects cannot. 2^ Consequently the assessor must consider a l l those f a c t o r s which would 27 a f f e c t the mind of a tenant from year to year, but nothing more. Secondly, i t has been recognised that the taxpayer's l i a b i l i t y to r a t e s w i l l depend on the use he makes of h i s p r o p e r t y ; 28 and that he can, by h i s own a c t i o n s , reduce t h i s l i a b i l i t y . The date of the v a l u a t i o n i s to be the date of the proposal 29 to a l t e r the v a l u a t i o n l i s t . On a general r e v a l u a t i o n ; which should take place every f i v e 30 years; c u r r e n t values should be employed. However as a consequence 26 Blackburn J . S t a l e y v. C a s t l e t o n (1864) 5 B. & S. 505 at 513-4; 122 E.R._920_at 923-4. But c f . Townley M i l l Co. (1919) L t d .  v. Oldham A.C. /1937/ A.C. 419 & Consett I r o n Co. L t d . v. Durham A.C. j_1931/A.C. 396, 407~10. 2 7 Cartwright v. Sculcoates Union. £L899j 1 Q.B.D. 667, 623; _ Robinson Bros (Brewers) L t d . v. Houghton & C h e s t e r - l e - S t r e e t A.C. J193T_I 2_J_.B_ 445 ,'"469, 471; Railway Assessment A u t h o r i t y v. SouthemRail. Co. A936/ A.C. 266, 285-6; Ryde on Ra t i n g , op. c i t . , p. 385. 2 8 R...v. St. Luke's H o s p i t a l (1760) 2 Burr. 1053,. 1064; 97 E.R. 703, 709. 29 _ _ B a r r a t t and R u s s e l l ' s Gravesend Brewery L t d . v. Gravesend  A.C. /1941/ 2.k.b. 107, 115. 3 0 R a t i n g and V a l u a t i o n A c t 1925, 15 and 16 Geo. 6 c. 90, s. 19 (1) as amended by the L o c a l Government A c t 1948 s. 34 (1) and the Ra t i n g and V a l u a t i o n A c t 1959, s. 1. 48. of the complex nature of the revaluation the values adopted w i l l be two 31 or more years out of date at the introduction of the new l i s t . This l i s t w i l l then remain valid until a new revaluation 32 occurs, though each entry may be altered at any time during the l i f e of the l i s t . England and Wales -- Conclusion In England and Wales the assessor is by statute required to establish the annual value of each property. The statutory definitions of value have been amplified by the Courts and the assessor has no ef fective discretion in the selection of the basis of assessment. The Courts have specified the assumed conditions of the tenancy, the condition of the premises, the date and duration of the tenancy, the repairing and other l i a b i l i t i e s , and the range of factors influen cing the decisions of prospective tenants. The assessor is l e f t with the task of isolating the relevent elements affecting value and estab lishing their importance. He is also l e f t with discretion as to the method of valuation to be adopted (except in the case of public u t i l i t y 33 undertakings). 3T R. v. Paddington Valuation Officer and another, ex parte  Peachey Property Corporation Limited /1964/ 3 A l l E.R. 200, 204, 214-6. 32 Local Government Act 1948, s. 34 as enacted by Rating and  Valuation Act 1959, s. 1 and schedule. Earl of Halsbury, The Laws of England, ed. Lord Simons (third edition; London: Butterworth & Co. (Publishers) Ltd., 1952), XXXLI, p. 76. Ryde on Rating, op. c i t . , p. 398. Robinson Bros. (Brewers) Ltd.  v. Houghton /1937/ 2 K.B. 445, 484; North & South Western Junction  Railway Co. v. Brentford Union A.C. (1888) 13 App. Cas. 592, 593. 4 9 . These are however v i t a l to the assessing f u n c t i o n and w h i l s t he i s not r e q u i r e d to make any assumptions as to the b a s i s of assess ment to be adopted, the assessor i s given the freedom necessary f o r him to make h i s estimate of value under the market c o n d i t i o n s s p e c i f i e d by the Courts. I n some cases those s p e c i f i e d c o n d i t i o n s w i l l be the same as those of the r e p r e s e n t a t i v e market t r a n s a c t i o n and the assessor w i l l be determining market value. I n a l l other cases he w i l l be determining value under h y p o t h e t i c a l market c o n d i t i o n s ( f o r example, l a r g e indus t r i a l complexes and suburban houses are r a r e l y l e t on occupation l e a s e s ) . Sometimes minor a l t e r a t i o n s w i l l have to be made to market r e n t s to reduce them to the s t a t u t o r y terms (a f u l l r e p a i r i n g and i n s u r i n g lease of a shop i s an example) w h i l s t on other occasions the r e n t reserved may be of no s i g n i f i c a n c e (e.g., r e n t c o n t r o l l e d premises). England and Wales -- Recent Enactments 34 Sections 17 and 18 of the L o c a l Government A c t 1966 are a p p l i c a b l e to proposals to a l t e r the v a l u a t i o n l i s t made a f t e r 2nd December 1965. The e f f e c t of these p r o v i s i o n s i s to r e q u i r e the asses sor to value the premises by reference to the same s t a t e and occupa t i o n ; and w i t h reference to the amenities of the l o c a l i t y ; as they e x i s t e d a t the date of the pr o p o s a l , but w i t h reference to the l e v e l of values adopted when the l i s t came i n t o f o r c e ( A p r i l 1963). • 34 Halsbury's S t a t u t e s (2nd ed.) — I n t e r i m S e r v i c e , c. 42. Reenacted i n Se c t i o n 20 of the General Rate A c t 1967.Section 17 of the L o c a l Government A c t 1966 i s set out i n Appendix A. 50. These s e c t i o n s do not apply to p u b l i c u t i l i t y undertakings' premises which are valued by means of the p r o f i t s b a s i s . The s i g n i f i c a n c e of these p r o v i s i o n s w i l l be discussed i n Chapter V; but i t can be seen t h a t the b a s i s of assessment to be adop ted under the L o c a l Government A c t i s one of r e n t a l values under hypo t h e t i c a l market c o n d i t i o n s , and that market r e n t a l values are no longer of d i r e c t relevance. B) B r i t i s h Columbia I n B r i t i s h Columbia r e a l e s t a t e provides the tax base f o r the business tax and the r e a l property tax. The business tax i s l e v i e d 35 on the b a s i s of the r e n t a l v a l u e of premises occupied. The r e a l property tax comprises two l e v i e s . The general r a t e which i s used to finance m u n i c i p a l s e r v i c e s and the school r a t e which 36 i s l e v i e d f o r p u b l i c school purposes. The l a t t e r i s l e v i e d on a d i f  f e r e n t tax base to that on which the general r a t e i s l e v i e d ; but the 37 same b a s i s of assessment i s adopted. - " . M u n i c i p a l A c t , R.S.B.C. 1960, c. 255, s. 427 ( 1 ) ; Van couver Charter 1953, c. 55, s. 280(a). 3(* Moore, Guttman and White, op. c i t . , p. 82. 3 7 Taxation A c t , R.S.B.C. 1960, c. 376, s. 2; P u b l i c Schools  Acti, R.S.B.C. 1960, c. 319, s. 2; Assessment E q u a l i z a t i o n A c t , R.S.B.C. I960, c. 18, s. 37 ( 3 ) ; M u n i c i p a l A c t R.S.B.C.1960, c. 255, ss. 2, 206 ( 3 ) ; Vancouver Charter 1953 c. 55, s. 373. 51. Property tax assessments are one.half of the " a c t u a l v a l u e " 38 of land and improvements and the tax i s l e v i e d on 100% of the assess ment on the land and on 757. of the assessment on the improvements (a smaller percentage of the assessment on improvements may i n some cases be adopted). The Assessment E q u a l i z a t i o n A c t i s concerned w i t h assess ments f o r school purposes but i t has de f a c t o a u t h o r i t y over assess- 39 ments f o r general revenue purposes. S e c t i o n 37(1) of the A c t s t a t e s : The Assessor s h a l l determine the a c t u a l value of land and improvements. I n determining the a c t u a l v a l u e , the Asses sor may give c o n s i d e r a t i o n to present use, l o c a t i o n , o r i g i n a l c o s t , cost of replacement, revenue or r e n t a l v a l u e , and the p r i c e that such land and improvements might reasonably be expected to b r i n g i f o f f e r e d f o r s a l e i n the open market by a so l v e n t owner, and any other circumstances a f f e c t i n g the v a l u e ; and without l i m i t i n g the a p p l i c a t i o n of the foregoing c o n s i d e r a t i o n s , where any i n d u s t r y , commercial undertaking, p u b l i c u t i l i t y e n t e r p r i s e , or other operation i s c a r r i e d on, the land and improvements so used s h a l l be valued as the pro perty of a going concern. S e c t i o n 330(1) of the M u n i c i p a l A c t i s i n p r a c t i c a l l y the same form. A t Se c t i o n 338 i t r e q u i r e s that premises of which the fee simple cannot be assessed, are to be valued a t the sum which a w i l l i n g buyer would be expected to pay a. w i l l i n g s e l l e r e x c l u d i n g the value of any business or g o o d w i l l . This gives some i n d i c a t i o n of the con d i t i o n s of the t r a n s a c t i o n that are to be assumed. However i t a p p l i e s 38 Taxation A c t , R.S.B.C. 1960, c. 376, s. 31 as amended by 1961, c. 61, s. 3; Assessment E q u a l i z a t i o n A c t , R.S.B.C. 1960, c. 18, s. 37(1); M u n i c i p a l A c t R,',S.B.C. 1960, c. 255, s. 330(1) ; Vancouver  Charter 1953, c. 55, s. 342; P u b l i c Schools A c t R.S.B.C. 1960, c. 319, ss. 31,198. B. I . Ghert, op. c i t . , pp. 56-57. 52. only to those p r o p e r t i e s of which the fee simple i s vested i n the Crown or i n a M u n i c i p a l i t y , but which are so occupied as to be l i a b l e f o r 40 t a x a t i o n . Consequently i t i s l i m i t e d i n e f f e c t ; and sin c e i t f a i l s to s p e c i f y the s t a t e of the market and c e r t a i n of the terms of the t r a n s a c t i o n , such as f i n a n c i n g , which are to be assumed, i t provides an imperfect d e f i n i t i o n of value. The Vancouver Charter r e q u i r e s that I n e s t i m a t i n g the a c t u a l value of any p a r c e l , the assess ment commissioner s h a l l be guided s o l e l y by h i s own judge ment based upon h i s personal knowledge or the in f o r m a t i o n f u r n i s h e d him by h i s s t a f f . 4 1 However reference i s made to the p r o v i s i o n s of the Assessment E q u a l i - 42 43 z a t i o n A c t i n the Vancouver Charter, the P u b l i c Schools A c t and the 44 Taxation A c t . The Statutes of B r i t i s h Columbia are subject to constant r e v i s i o n and amendment and other bases of assessment have been enacted 45 i n e a r l i e r s t a t u t e s . The c u r r e n t s t a t u t o r y p r o v i s i o n s do not d e f i n e " a c t u a l v a l u e " and t h e i r i n t e r p r e t a t i o n has o f t e n been considered by the Courts. Some 4 " M u n i c i p a l A c t R.S.B.C. 1960, c. 255, ss. 336, 337. 41 Vancouver Charter 1953, s. 345. s. 14 4 2 S. 345 ( 2 ) : Vancouver Charter Amendment A c t 1962, c. 82, 43. Sec. 31. Sec. 2. 44 45 See M u n i c i p a l A c t 1914, c. 52, s. 199 and the Vancouver  I n c o r p o r a t i o n A c t 1921, c. 55, s. 39. 53. understanding of the b a s i s of assessment to be adopted by the asses sors can be obtained from t h e i r d e c i s i o n s . B r i t i s h Columbia — J u d i c i a l I n t e r p r e t a t i o n As mentioned e a r l i e r , " a c t u a l v a l u e " , " r e a l v a lue", " f a i r 46 market v a l u e " , and " a c t u a l cash v a l u e " are synonymous terms. They do not, however, mean the same t h i n g f o r assessment pur- 47 poses as f o r e x p r o p r i a t i o n purposes, and f o r property t a x a t i o n , "value" means exchangeable value -- the p r i c e which the subject w i l l b r i n g when exposed to the t e s t of competition.48 The assessor has to determine a f i g u r e of value and the Courts have refused to accept s a l e p r i c e s without c o n f i r m a t i o n of t h e i r r e l e - 49 vance to a c t u a l value. 4b R e Rowan's Appeal (1962) 40 W.W.R. 627, 628-9; Stock  Exchange B u i l d i n g Corporation L t d . v. Vancouver. _1945_/ 2 W.W.R. 248, 250; See a l s o Montreal I s l a n d Power Co. v. Town of L a v a l des  Rapides (1935) S.C.R. 304, 305. 47 C i t y of Vancouver v. Vine Lodge L t d . and another. (1964) unreported: Province of B.C. Stated Cases ( V i c t o r i a : O f f i c e of the Assessment j_omm_issioner) pp. 231, 234; ap p l y i n g , Sun L i f e Ass. Co. v.  Montreal. _/1950/ 2 D.L.R. 785, 788/9. 48 Lord MacLaren i n Lord Advocate v. E a r l of Home. (1891) 28 Sc. L.R. 289, 293; as r e s t a t e d i n Montreal I s l a n d Power Co. v.  Town of L a v a l des Rapides. /_1935/ S.C.R. 304, 305; and i n P r o v i n c i a l  Assessors of Comox, Cowichan & Nanaimo v. Crown Z e l l e r b a c h Canada L t d . et a l . (1963) 39 D.L.R. (2d) 381, 396. 4 9 Re Rowan's Appeal (1962) 40 W.W.R. 627, 628, 629; Re Crown Z e l l e r b a c h Canada L t d . (1959) 16 D.L.R. (2d) 144, 153; see H.E. Manning. Assessment and R a t i n g (4th e d i t i o n ; Toronto: Canada Law Book Co. L t d . , 1962), p. 162. 54. A c t u a l value i s market determined and not a value to the 50 owner concept, but the c o n d i t i o n s of the t r a n s a c t i o n and the nature of the market are not s p e c i f i e d i n the Sta t u t e s . S e c t i o n 37(1) of the Assessment E q u a l i z a t i o n A c t sets out c e r t a i n f a c t o r s which may be considered by the assessor. T h e i r c o n s i d e r a t i o n by the assessor i s 51 not o b l i g a t o r y , and he may consider "any other circumstances" which 52 he f e e l s are r e l e v a n t . Only the p r o v i s i o n r e l a t i n g to the v a l u a t i o n of "any i n d u s t r y , 53 commercial undertaking," e t c . , as a going concern, i s mandatory. The term "going concern" however has been defined n e i t h e r by 54 s t a t u t e nor j u d i c i a l l y , but i n 1964 i t was i n t e r p r e t e d to mean ^ Re Crown Z e l l e r b a c h Canada L t d . (1959) 16 D.L.R. (2d) 144; Re Appeals of S h e l l O i l Co. of Canada L t d . and another (1962) 38 W.W.R. 695, 699/700; 33 D.L.R. (2d) 443, 447; Crown Z e l l e r b a c h  Canada L t d . and another v. A.D. of Comox and others (1963) 39 D.L.R. (2d) 381; C.N.R. v. Vancouver C i t y /1950/ 2 W.W.R. 337; Re Lefeaux (J_963__ 37 D.L.R. (2d) 235, 238; Cf.~Bishop of V i c t o r i a v. V i c t o r i a . 2l933/ 3 W.W.R. 332, 335, 345; _ See a l s o Montreal I s l a n d Power Co. v.  Town of L a v a l des Rapides /1935/ S.C.R. 304, 318; Sun L i f e Ass. Co.  v. Mont r e a l . _1950/ 2 D.L_R. 785, 802-803; ' /_195___ 2 D.L.R. 81, 90; C f . Winnipeg v. Cross /1926/ 2 W.W.R. 868; /_1926/ 3 W.W.R. 644. 5 1 R. v. P e n t i c t o n Sawmills L t d . (1954) 11 W.W.R. (N.S.) 351; Vancouver v. Township of Richmond (1958) 17 D.L.R. (2d) 548. 5 2 Vancouver v. Township of Richmond. (1958) 17 D.L.R. (2d) 548. 53 See Canadian C o l l i e r i e s Resources L t d . v. C i t y of P o r t  Moody (1961) Stated Cases, op. c i t . , p. 106; C.P.R. v. C i t y of Vancouver (1965) 50 W.W.R. 302, 307; a f f i r m i n g A l k a l i Lake Ranch L t d . v. Pro v i n c i a l A s s e s s o r s , Quesnel Forks e t a l . (1964) 46 W.W.R. 528; (1964) 48 W.W.R. 120. Canadian C o l l i e r i e s Resources L t d . v. C i t y of P o r t Moody (1961) Stated Cases, op. c i t . , p. 106; Re C.P.R. and Assessor of P o r t Coquitlam (1957) 77 C.R.T.C. 95, 100; Vancouver v. Township of Richmond (1958) 17 D.L.R. (2d) 548, 551. 55. that the main undertaking of which the land under assess ment i s a p a r t i s to be tr e a t e d as s t i l l being operated and the land i s not to be valued separately as bare land. These p r o v i s i o n s do not admit a value to the owner concept and Mr. J u s t i c e Ruttan has s a i d i n the Supreme Court of B.C. "Valued as the property of a going concern" does not mean "as the property of the going concern" and i n the present case adds nothing not already included under the f a c t o r "present use."-^ I n determining a c t u a l v a lue, the value to be as c e r t a i n e d i s a value i n exchange; w i t h a l l f u t u r e prospects considered "Present use" here must mean present proper, and p r a c t i c  able use so that the speculator s h a l l not escape proper t a x a t i o n nor the developer be penalised.-' 7 Since a c t u a l value i s a value i n exchange the e f f e c t s of zon- 58 i n g r e g u l a t i o n s must be considered, but the relevance of agreements 5 T N o r r i s J . A l k a l i Lake Ranch L t d . v. P r o v i n c i a l A s s e s s o r s , Quesnel Forks et a l . (1964) 46 W.W.R. (N.S.) 528; 48 W.W.R. (N.S.) 120 a t 123. (Court of Appeal of B.C.) See a l s o Brown J . i n Vancouver  v. Township of Richmond. (1958) Stated Cases, op. c i t . , p. 53 at 54. 5 6 Re Crown Z e l l e r b a c h Canada L t d . (1959) 16 D.L.R. (2d) 144, 152. 5 7 Wilson J . Re C.P.R. & Assessor of P o r t Coquitlam (1957) 77 C.R.T.C. 95, 100; c i t e d i n Re Crown Z e l l e r b a c h Canada L t d . et a l . (1958) 16 D.L.R. (2d) 144, 152; see a l s o C.N.R. v. Vancouver /1950/ 2 W.W.R. 337, 340; Re Lefeaux (1963) 37 D.L.R. (2d) 235; Canadian C o l   l i e r i e s Resources L t d . v. Comox A.D. (1962) Stated Cases op. c i t . , p. 140; Coddington v. West Vancouver (1962) Stated Cases op. c i t . , p. 138; C i t y of Vancouver v. Schenley Holdings L t d . (1965) Stated  Cases op. c i t . , p. 249.. 5 8 Re Desautel's Appeal (1959) 29 W.W.R. 665; Re Appeals  of S h e l l O i l Co. of Canada L t d . and another (1962) 38 W.W.R. 695; G.f.  C.N.R. v. Vancouver /1950/2 W.W.R. 337. r e s t r i c t i n g the use of land i s l e s s than c l e a r . I n C.N.R. v. Vancouver r e s t r i c t i o n s on the use of r a i l w a y l a n d (both by agreement w i t h the C i t y of Vancouver and by the needs of the r a i l w a y ) were he l d to be of 59 60 major importance w h i l s t i n Re Desautel's Appeal a c o n t r a c t u a l ob l i g a t i o n under-the Veterans' Land A c t 1942 was held to be i r r e l e v a n t . 61 I n Re Mercer v. Surrey the f u t u r e e x p i r a t i o n of a lease without prospect of renewal was considered to be p e r t i n e n t i n v a l u i n g improve ments on I n d i a n land. I n c o n s i d e r i n g p o s s i b l e uses to which the property could be put, a c o n t r a s t must be drawn between the p o s s i b i l i t y of changing the use of the premises i n the f u t u r e and the assumption that the property i s , a t the date of v a l u a t i o n , developed or used to i t s utmost, regard l e s s of i t s a c t u a l use. An example of the former i s farm land to which p a r t i c u l a r value accrues as a r e s u l t of the p r o f i t a b i l i t y of s u b d i v i  s i o n . This i s a value i n exchange and may be a market value f i g u r e . To assume that the land i s already subdivided w i l l r e s u l t i n a f i g u r e of value under h y p o t h e t i c a l market c o n d i t i o n s . This assumption has 62 been r e j e c t e d by the Courts i n i n t e r p r e t i n g " a c t u a l value". 59 _1950/ 2 W.W.R. 337, 340, 344. 6 0 (1959) 29 W.W.R. 665. 6 ! (1961). Unreported. Stated Cases op. c i t . , p. 83. 6 2 See Bishop of V i c t o r i a v. V i c t o r i a /19337 3 W.W.R. 332; G r i e r s o n v.Edmonton /1917/ 2 W.W.R. 1138, 1142; Re C h r i s t i e &  Clarke's Appeal /1937/ 1 W.W.R. 81. 57. 63 I n the Sun L i f e Case the E n g l i s h p r i n c i p l e s were a p p l i e d and The Chief J u s t i c e of Canada i n d i s c u s s i n g the words " a c t u a l v a l u e " s t a t e d : I n the y e a r l y v a l u a t i o n of a property f o r purposes of muni c i p a l assessment there i s no room f o r hypothesis as regards the f u t u r e of the property. The assessor should not look at past or subsequent or p o t e n t i a l value. The v a l u a t i o n must be based on c o n d i t i o n s as he f i n d s them at the date of assessment.64 This case was concerned w i t h the p r o v i s i o n s of the Charter of the C i t y of Montr e a l but i t was f i n a l l y decided by the J u d i c i a l Committee of the P r i v y C o u n c i l and consequently i s b i n d i n g i n B r i t i s h Columbia. Despite t h i s d e c i s i o n , the Courts i n B r i t i s h Columbia are s t i l l adopting a value i n exchange b a s i s of assessment, and some con f l i c t would appear to e x i s t between adopting a value i n exchange or an e x i s t i n g use value when implementing S e c t i o n 37. I n endeavouring to e s t a b l i s h the nature of the presumed t r a n s a c t i o n the Courts have used such c o n f l i c t i n g phrases as " w i l l i n g 65 66 67 buyer — w i l l i n g s e l l e r , " "prudent purchaser" and solvent owner. 6 3 Sun L i f e Ass. Co. v. Montreal /19507 2 D.L.R. 785; /_95__7 2 D.L.R. 81; a p p l i e d i n Re R o y a l i t e O i l Co. L t d . Assessment (1957J 11 D.L.R. (2d) 527. __4 /T9507 S.C.R. 220, 224; see a l s o Bishop of V i c t o r i a v.  V i c t o r i a /1933/ 3 W.W.R. 332. _ _ 6 5 Sun L i f e Ass. Co. v. Montreal. /I9507 2 D.L.R. 785, 807; £1952/ 2 D.L.R. 81, 89; Stock Exchange B u i l d i n g Corp. L t d . v. Van  couver . /_1945/ 2 W.W.R. 248, 250; see a l s o Butcher v. Vancouver /1950/ 1 W.W.R. 961, 969. 66 _ - Sun L i f e Ass. Co. v. Montreal. _/1950/ 2 D.L.R. 785, 793 I n Re L i o n s Gate Assessment Appeal /1940/ 1 W.W.R. 624, 625; Canadian  C o l l i e r i e s Resources L t d . v. ComoxA.D.. (1962) Stated Cases op. c i t . , 140, 143; Pearce v. Calgary. (1915) 9 W.W.R. 668, 672/3; C f . Vancouver v. Vine Lodge L t d . (1964) Stated Cases, OP. c i t . . 231, 234. 58. Neither " w i l l i n g " nor "prudent" are absolute d e s c r i p t i o n s and i t i s l e f t to the assessor to determine the w i l l i n g n e s s of the vendor and purchaser; or the nature of the prudent purchaser. I n some cases, as a r e s u l t of s p e c i a l market c o n d i t i o n s (such as periods of economic depression, whimsical changes i n t a s t e , e t c . ) , a t r a n s a c t i o n between a prudent purchaser and solvent owner i n an e x i s t i n g market-place would not be the same as the r e p r e s e n t a t i v e market t r a n s a c t i o n . Consequently the assessor must, subject to the c o n t r a d i c t o r y requirements of the J u d i c i a r y , determine the importance of market evidence, and the wisdom and p e r s p i c a c i t y of the prudent purchaser, or the w i l l i n g n e s s or anxiety of the w i l l i n g s e l l e r and w i l l i n g buyer. I t has however been determined that the p r i c e obtainable i n a forced s a l e i s not r e l e v a n t ; n e i t h e r are s p e c u l a t i v e s a l e p r i c e s or 68 e x c e s s i v e l y high or unduly low p r i c e s . Values "on a normal f o o t i n g " 69 have however, been he l d to be acceptable, but market p r i c e s , o n t h e i r 70 own have been r e j e c t e d as evidence of value. 67 i n Re Charleson Assessment (1915) 21 B.C.R. 281, 285 r e  l a t i n g to the p r o v i s i o n s of the Vancouver I n c o r p o r a t i o n A c t 1900; Re M u n i c i p a l A c t ; Gate's Case /1918/ 2 W.W.R. 930; Bishop of V i c t o r i a  v. V i c t o r i a /1933/ 3 W.W.R. 332, 339- 68 Stock Exchange B u i l d i n g Corp. L t d . v. Vancouver _/1945/ 2 W.W.R. 248, 249. ~ 69 I n Re Charleson Assessment (1915) 21 B.C.R. 281. 70 Supra, Footnote 48, p. 53. 59. 71 An Assessment Manual i s i n use i n B r i t i s h Columbia and although i t i s there accepted t h a t the assessor has g e n e r a l l y to deter- 72 mine market value i t s t a t e s of a c t u a l value: the p r e c i s e meaning of " a c t u a l v a l u e " has been l i b e r a l l y argued i n the Courts and the most c o n s i s t e n t consensus i s t h a t i t i s the most cur r e n t value a t t a i n a b l e . 7 _ The inadequacy of t h i s d e s c r i p t i o n i s i n d i c a t i v e of the f a i l u r e of the Courts to express unequivocally the b a s i s of assessment to be adopted. As i n England and Wales the requirement i s that the date 74 of v a l u a t i o n i s to beJthe time of the assessment, but F i n n i s has commented that A l l r e l e v a n t l e g i s l a t i o n r e q u i r e s the assessment of r e a l property to be based on " a c t u a l value''. This term i s s t r i c t l y i n t e r p r e t e d to mean curr e n t value which f o r p r a c t i c a l pur poses means that 1959 values were used f o r the 1961 r o l l and 1960 values f o r the 1962 r o l l and so on.7-' Consequently the s i t u a t i o n regarding the relevance of the assessments to c u r r e n t l e v e l s of value i n B r i t i s h Columbia p a r a l l e l s that i n Eng- 7T S e c t i o n 7 (b) of the Assessment E q u a l i z a t i o n A c t R.S.B.C. 1960, c. 18, empowers the M i n i s t e r to "give advice and a s s i s t a n c e to Assessors . . . ." _ 7 2 Province of B r i t i s h Columbia, A p p r a i s a l Manual (2nd ed. / _ i c t o r i a : Government of Province of B.C_/), p. 403. 7 3 I b i d - » P- <v)- 7 4 Re Lefeaux (1963) 37 D.L.R. (2d) 235. 75 "Real Property Assessment i n Canada", op. c i t . , p. 24. 60. land and Wales, since i n both cases the values on a new r o l l w i l l be two years or so out of date. The absence of l i m i t a t i o n on the method of v a l u a t i o n to be 76 adopted by the assessor i n B r i t i s h Columbia a l s o p a r a l l e l s the s i t u a t i o n i n England and. Wales.. B r i t i s h Columbia — Conclusion Many taxes have r e a l property as the."'tax base, and the r e a l 77 property tax has d i f f e r i n g t ax bases and bases of assessment. Where Se c t i o n 37(1) of the Assessment E q u a l i z a t i o n A c t a p p l i e s , and the assessor i s r e q u i r e d to determine " a c t u a l value", considerable d i s c r e t i o n i s l e f t w i t h him regarding the b a s i s of assessment to be adopted. I t i s presumed from the wording of j u d i c i a l d e c i s i o n s , and the absence of any requirement to determine r e n t a l value that the 78 assessors are r e q u i r e d to a s c e r t a i n a c a p i t a l value f i g u r e . / b R. v. P e n t i c t i o n Sawmills L t d . (1954) 11 W. W.R. (N.S.) 351, 353, 356; P r o v i n c i a l Assessors of Comox et a l . v. Crown Z e l l e r   bach Canada L t d . et a l . (1963) 39 D.L.R. (2d) 381, 386. 7 7 See the M u n i c i p a l A c t R.S.B.C. I960, c. 255 (as amended) Sections 328 A., 331, 332 (4), 333 and 338; and the Assessment Equal i z a t i o n A c t R.S.B.C. 1960 c. 18 (as amended) Sec. 37 (6) (d) and 37 (6) ( e ) ; and the Taxation A c t R.S.B.C. 1960, c. 376 (as amended) sees. 7 and 8, f o r examples of bases of assessment other than " a c t u a l v a l u e " as s p e c i f i e d i n Sec. 37 (1) of the Assessment E q u a l i z a t i o n A c t . 78 _ _ See Stock Exchange B u i l d i n g Corporation L t d . v. Vancouver A945/ 2 W.W.R. 248, 249/251; Butcher v. Vancouver /1950/ 1 W.W.R. 961, 969 and c . f . M u n i c i p a l A c t R.S.B.C. 1960 s. 42~ ( 1 ) ; see a l s o . J.H. P e r r y , Taxation i n Canada (Toronto: U n i v e r s i t y of Toronto P r e s s , 1961), p. 260. 6 1 . W h i l s t a value to the owner f i g u r e i s not r e l e v a n t , the pro v i s i o n that c e r t a i n c l a s s e s of r e a l e s t a t e are to be valued as a going concern, r e q u i r e s the assessor to depart from " a c t u a l v a l u e " and value i n accordance w i t h a p r o v i s i o n that has not been j u d i c i a l l y d e f i n e d . A c o n f l i c t e x i s t s between the employment of e x i s t i n g use v a l  ues and values i n exchange, and consequently " d i s c r e t i o n as to which b a s i s of assessment he w i l l use i s f o r the most pa r t l e f t w i t h the 79 assessor." The c o n d i t i o n s of the t r a n s a c t i o n , and the market i n which i t takes place have been p o o r l y d e f i n e d , and w h i l s t there i s a presump t i o n t h a t a f i g u r e of value under a c t u a l market c o n d i t i o n s i s the ob j e c t i v e , the Courts have discounted the use of s a l e p r i c e s alone as evidence of value and have r e q u i r e d c o n s i d e r a t i o n of c o n s t r u c t i o n c o s t s , and normal values. Thus d e s p i t e the readiness of the Courts to cons i d e r , and comment on, the f a c t o r s the assessor ought to have considered i n any p a r t i c u l a r case, the b a s i s of assessment has not been c l e a r l y estab l i s h e d . This i n d i c a t e s a preoccupation w i t h the means by which assess ments are made r a t h e r than the nature of the f i n a l assessment. 79 p,H. White. "Concepts of Assessment Value", op. c i t . , p. 112; F.H. F i n n i s . "Real P r o p e r t y Assessment i n Canada" op. c i t . , p. 17. _ See MacDonald C.J.B.C. Bishop of V i c t o r i a v. V i c t o r i a . /19337 3 W.W.R. 332, 334. 62. I n such circumstances i t i s d i f f i c u l t to achieve e q u a l i t y of treatment,and the i n a b i l i t y to i d e n t i f y the b a s i s of assessment w i l l c reate s u s p i c i o n i n the mind of the taxpayers as to the v a l i d i t y of t h e i r assessments. 6 3 . CHAPTER IV THE EXISTENCE OF INCORRECT BASES OF ASSESSMENT We have seen that the s t a t u t o r y p r o v i s i o n s r e l a t i n g to the b a s i s of assessment can f a i l to provide an unequivocal d e f i n i t i o n of v a l u e ; that they may have to be i n t e r p r e t e d i n the l i g h t of j u d i c i a l d e c i s i o n s ; and that d i f f e r i n g i n t e r p r e t a t i o n s may be placed on s p e c i f i c p r o v i s i o n s . However, i n e q u a l i t y of treatment w i l l a r i s e whenever there i s a l a c k of compliance w i t h the i n t e n t i o n s of the l e g i s l a t o r s (as i n t e r p r e t e d by the j u d i c i a r y where necessary). I n t h i s Chapter i t w i l l be shown that there have been departures from the l e g a l r e q u i r e  ments i n both the United Kingdom and Canada. Such a departure w i l l create a c o n f l i c t between u n i f o r m i t y of assessment and correctness of assessment w i t h regard to new e n t r i e s on the assessment r o l l . Since the existence of s t a t u t o r y or j u d i c i a l p r o v i s i o n s r e q u i r i n g the u n i f o r m i t y of treatment may a f f e c t the r e l a - 1 t i v e importance of correctness or u n i f o r m i t y an examination w i l l be made i n the next Chapter of those a u t h o r i t i e s i n the United Kingdom and Canada r e q u i r i n g u n i f o r m i t y or e q u a l i t y of treatment. "~ 1 "Correctness" and "correctness of assessment" r e f e r to the p r o x i m i t y of each assessment to the c o r r e c t f i g u r e which the law r e q u i r e s to be entered on a new r o l l , the existence of other assessments being ignored. They should be contrasted w i t h the " c o r r e c t burden of tax a t i o n " , which i s discussed l a t e r . 64. A) England and Wales. I n determining the r e n t a l value of premises the assessors are re q u i r e d to ignore the existence of s t a t u t o r y l i m i t a t i o n s on the amount 2 of ren t that can be charged, but i n the 1920's the assessments of most d w e l l i n g houses were made by reference to c o n t r o l l e d r e n t s d e s p i t e the 3 evidence of f r e e market r e n t s . I t would appear t h a t reference to con- 4 t r o l l e d r e n t s was being made by the assessors as r e c e n t l y as 1961, de s p i t e the requirement that the assessor determine the amount at which the premises "might reasonably be expected to l e t . " . I n 1950, the as s e s s i n g f u n c t i o n was taken out of the hands of the l o c a l a u t h o r i t i e s i n England and Wales and given to v a l u a t i o n o f f i - 5 cers authorized and c o n t r o l l e d by the Commissioners of Inland Revenue. U n t i l the f i r s t v a l u a t i o n l i s t s made by the In l a n d Revenue's assessors came i n t o e f f e c t i n 1956 i t was the o f f i c i a l p r a c t i c e of the v a l u a t i o n o f f i c e r s to b r i n g new and a l t e r e d premises i n t o the l i s t a t a l e v e l of value that accorded w i t h the "tone of the l i s t " . This was g e n e r a l l y accepted by the Lands T r i b u n a l although i t c o n f l i c t e d w i t h the l e g a l 6 requirements of an assessment. 2 Popl a r A.C. v. Roberts. A922/ 2 A.C. 93. 3 H i c k s , Hicks and Leser op. c i t . , pp. 56/60. The f r e e r e n t s were not r e p r e s e n t a t i v e of the values of a l l houses since they were the r e s u l t of a s c a r c i t y occasioned p a r t l y by the r e n t c o n t r o l p r o v i s i o n s . 4 Contrast the assessments and r e n t a l evidence given i n R. v.  Paddington V a l u a t i o n O f f i c e r ex parte Peachey P r o p e r t y Corporation L t d . A964/ 3. A l l . E.R. 200, and see _1965/ 2 A l l E.R. 836, 850. 5 L o c a l Government A c t 1948. 11 and 12. Geo. 6 c. 26. S.33: Ryde on R a t i n g op. c i t . , p. 396. 6 Rvde on R a t i n g op. c j t . . pp. 396/397. 65. Such a p o l i c y was necessary as assessments i n the l i s t s were g e n e r a l l y at 1934-1939 values and because of the s u b s t a n t i a l changes brought about by>£he Second World War i t would have r e s u l t e d i n hardship to make new assessments at the then current l e v e l of values. F u r t h e r , the I n l a n d Revenue had taken over l i s t s t hat had been made by the asses sors of d i f f e r e n t a u t h o r i t i e s and u n i f o r m i t y d i d not e x i s t as between d i f f e r e n t l i s t s . I n 1960 the o p i n i o n was expressed by a member of the Lands T r i b u n a l that these c o n s i d e r a t i o n s were no longer appropriate and that each new assessment must be made according to the circumstances at the 7 date of the proposal. . I n other cases a f t e r the 1956 r e v a l u a t i o n , how ever, reference has been made to the "tone" of other assessments when 8 they d i d not conform w i t h the r e n t a l evidence. I t has a l s o been dec l a r e d that i t i s the p o l i c y of the Inland Revenue to assess new and a l t e r e d premises i n accordance w i t h the l e v e l 9 of values that was cu r r e n t when the v a l u a t i o n l i s t came i n t o f o r c e . 1 R.C.G. Fennel Esq. i n Harrow Borough C o u n c i l v. B e t t s . (1960) LT. 53 R. and l . T . 577, 578. 8 Jones v. Small (V.O.) (1957) 50 R. and l . T . 725; Cotswold  E l e c t r i c , L t d . v. Howard (V.Q.) (1958) 51 R. and l . T . 125; Rawlinson  and Co. L t d . v. P r i t c h a r d . (1958) 52 R. and l . T . 182; See a l s o B r i t i s h  American Typewriters v. H i l l (V.Q.). (1962) 2 R.V.R. 374; 1962 R.A. 298 and Lotus and D e l t a L t d . v. Holman (V.O.). (1963) 3 R.V.R. 296: 1963 R.A. 113; The Chartered Surveyor, V o l . VC .. p. 648. 9 Great B r i t a i n . Parliamentary Debates (Commons), f i f t h s e r i e s , (London: Her Majesty's S t a t i o n e r y O f f i c e ) , D C I I I (1959) 1165-6, Mr. H. Brook ( M i n i s t e r of Housing and L o c a l Government); a l s o DCCXXIX (1966) 1265, Mr. Crossman ( M i n i s t e r of Housing & L o c a l Government); Great B r i t a i n . Parliamentary Debates ( L o r d s ) , f i f t h s e r i e s , (London: H.M.S.O.), CCXXXLI (1961) 419, E a r l J e l l i c o e ; and CCLXXII (1966) 463, Lord Kennet. 66. Such a p o l i c y can be of considerable consequence since the 10 intended quinquennial r e v a l u a t i o n s are the exception and new valua  t i o n l i s t s came i n t o e f f e c t i n 1956 and 1963 and the next i s scheduled 11 f o r 1973. Thus the values i n the l i s t can be from two to eleven years out of date. I n view of the d e c i s i o n i n the Ladies Hosiery and Underwear 12 13 case and th a t i n B a r r a t t v. Gravesend, the p r a c t i c e of adopting the "tone of the l i s t " f o r new assessments between r e v a l u a t i o n s i s of ex- 14' tremely d o u b t f u l v a l i d i t y . As mentioned i n Chapter 3 t h i s p r a c t i c e of the In l a n d Revenue has now been given s t a t u t o r y approval i n the L o c a l Government A c t 1966 and the General Rate A c t 1967. I n the 1963 r e v a l u a t i o n i t would appear that many of the houses i n London were assessed by adopting m u l t i p l e s of the assessments i n the 15 o l d l i s t . 10 Supra. I-*- L o c a l Government A c t 1966. c. 42 s. 16. 1 2 J1932J 2 K.B. 679. 1 3 _194_7 2 K-B- 1 0 7 • 1 4 Great B r i t a i n , Parliamentary Debates,, op. c i t . , Mr. H. Brook i b i d . ; E a r l J e l l i c o e i b i d . ; Harrow v. B e t t s (V.O.). (1960) 53 R. and I.T. 577, 578. ^ Great B r i t a i n . Accounts and Papers. Report of the Commit tee on Housing i n Greater London ( S i r M i l n e r Holland: Chairman), Cmnd 2605. (London. Her Majesty's S t a t i o n e r y O f f i c e , March 1965). Appen d i x V, p. 349. I t i s u n c e r t a i n how r e p r e s e n t a t i v e t h i s i s of other areas. 67. Any c o r r e l a t i o n between the s t a t u t o r y f i g u r e of gross value and the 1956-1963 assessment would be l a r g e l y f o r t u i t o u s since the l a t - 16 t e r were r e l a t e d to 1939 r e n t a l values having, as a consequence of the passing of 24 years and World War I I , l i t t l e r e l a t i o n s h i p w i t h 1963 17 r e n t s . Evidence on which to base the new assessments may have been 18 scarce but the use of such m u l t i p l i e r s i s c l e a r l y c o ntrary to the 19 20 St a t u t o r y p r o v i s i o n s , r e s u l t i n g i n i n e q u a l i t y of treatment. B) Canada. I n Canada too there are i n d i c a t i o n s that the assessors have i n some cases adopted a b a s i s of assessment other than cu r r e n t market value. I n B r i t i s h Columbia cases have come before the Courts i n which the assessors had taken a percentage of an estimate of value as " a c t u a l 21 value". 16 V a l u a t i o n f o r R a t i n g A c t 1953, 1 and 2, E l i z 2. c. 42 S.2. H See Report of the Committee on Housing i n Greater London, op. c i t . , Table 34, p. 355. 18 I b i d . , p. 347-8. The use of c o n t r o l l e d r e n t s as evidence of r e n t a l values (supra) can be a t t r i b u t e d to the same cause. 1 9 R. v. Paddington V.O. /19657 2 A l l E.R. 836, 842-843. 20 Report of the Committee on Housing i n Greater London, op.  c i t . , p. 354. The average r a t i o of net rent to New Gross Value f o r var ious c l a s s e s of r e s i d e n t i a l property ranges from o.83 to 2.72. S i n g l y occupied unfurnished p u r p o s e - b u i l t f l a t s have an average r a t i o of 1.00. But t h i s r a t i o f a i l s to r e v e a l that the d i s t r i b u t i o n from which i t i s deri v e d i s bimodal w i t h a primary mode at 0.855 and a secondary mode at 1.255. Table 35. 91 Evans Coleman and Evans and G i l l e y Bros. L t d . v. C i t y of  P o r t of Coquitlam. (1957) Stated Cases op. c i t . , p. 44; Pearce v. C i t y  of New Westminster. (1958) Stated Cases op. c i t . , p. 49; See a l s o Prov i n c i a l Assessors of Comox et. a l . v. Crown Z e l l e r b a c h Canada L t d . e t . a l . (1963) 39. D.L.R. (2d) 381. 68. Two assessment-sale p r i c e s t u d i e s have been made i n the 22 Vancouver area but i t i s impossible to determine from them the cause of any discrepancy between e x i s t i n g assessments and curr e n t s a l e p r i c e s . S i m i l a r s t u d i e s i n other provinces have shown up f a r greater 23 v a r i a t i o n s than were apparent i n Vancouver. The Royal Commission i n 24 New Brunswick considered that a misunderstanding or m i s i n t e r p r e t a  t i o n of the b a s i s of assessment c o n t r i b u t e d to the poor q u a l i t y of the assessments. The Saskatchewan Royal Commission's f i n d i n g s were incon c l u s i v e since the b a s i s of assessment adopted i s not a market value f i g u r e but i s dependent on e s t a b l i s h e d i n d i c e s . Urban land i s assessed i n Saskatchewan by reference to a 'base l o t value' which i s d e r i v e d from an index dependent on the impor tance of the urban centre. Improvements' assessments are r e l a t e d to t h e i r c ost of reproduction w i t h allowances f o r d e p r e c i a t i o n and obso lescence. These assessments r e l a t e to 1946 v a l u e s , except i n Saskatoon 25 where 1950 values are appropriate. 2 T Moore, Guttman and White, op. c i t . , p. 141. B.I. Ghert op. c i t . , p. 95. 2 3 Report of the Royal Commission on Finance and M u n i c i p a l Tax  a t i o n i n New Brunswick, op. c i t . , pp. 223/224; Report of the Royal Com mis s i o n on Taxation (Regina: P r o v i n c e of Saskatchewan, 1965) pp.124/125. See a l s o D.H. C l a r k . "Uniform Assessments" op. c i t . , p. 143. 2 4 Op. c i t . , pp. 222/223. 2-> Jack V i c q . L o c a l Government Finance. Research Study No. 1. f o r the (Saskatchewan) Royal Commission on Taxation (Regina: Royal Commission on Taxation, 1965), Table 9 ( v i i i ) . 69. The assessment of r u r a l property i s made on the assumption that f a i r value must be d e r i v e d from something more s t a b l e and constant than s a l e or current market value. Rather, value i s r e l a t e d to the a b i l i t y of the s o i l to produce an income f o r the property owner and t h i s income i s measured by means of long term production averages and p r i c e l e v e l s . The assessment system achieves t h i s by measuring s o i l p r o d u c t i v  i t y . . . .26 I n Saskatchewan the assessors are re q u i r e d to determine ' f a i r 27 valu e ' subject to the p r o v i s i o n that I n determining f a i r value . . . the assessor may take i n t o c o n s i d e r a t i o n and be guided by any a p p l i c a b l e formula r u l e or p r i n c i p l e set f o r t h i n a manual prepared f o r the guidance of assessors and approved by the M i n i s t e r . 2 8 Although t h i s p r o v i s i o n i s only permissive i t s p r o v i s i o n s are extremely wide and i t i s doubted whether an assessment made i n accor dance w i t h such a manual could be s u c c e s s f u l l y challenged. 26 L o c a l Government Continuing Committee. L o c a l Government  Finances i n Saskatchewan. A t e c h n i c a l reference document to the r e p o r t L o c a l Government i n Saskatchewan submitted to the Government of Saskat chewan, March 1, 1961. _/Regina, Government of the Province of Saskatche wan/ p. 91. See pp. 90-?9. 27 The document L o c a l Government Finances i n Saskatchewan describes i t as "vaguely d e f i n e d " i b i d . , p. 89.; See C i t y A c t R.S.S. 1965 c. 147 S. 456 ( 2 ) ; Town A c t R.S.S. 1965 c. 148 S. 423 ( 2 ) ; V i l l a g e A c t R.S.S. 1965 c. 149 S. 293 ( 2 ) ; R u r a l M u n i c i p a l i t y A c t R.S.S. 1965 c. 150 S. 292 ( 2 ) . 2 8 U n d e r l i n i n g added. The C i t y A c t S. 456 (16). A l s o i n the V i l l a g e A c t S. 293 (15), the Town A c t S. 423 (14) and the R u r a l  M u n i c i p a l i t y A c t S. 292 (20). 70. I n A l b e r t a the Assessment Commissioner has greater d i s c r e t i o n than i s given i n Saskatchewan. The M u n i c i p a l i t i e s Assessment and Equa l i z a t i o n A c t provides Upon the recommendation of the Commissioner the M i n i s t e r may p r e s c r i b e standards and methods of assessment and r u l e s , regu l a t i o n s and forms f o r the guidance of a l l or any assessor i n making assessments i n m u n i c i p a l i t i e s . Every standard ( e t c . ) . . . . made pursuant to t h i s s e c t i o n has upon p u b l i c a t i o n the same f o r c e and e f f e c t as i f i t has been enacted as p a r t of t h i s A c t . 2 9 The Assessment A c t provides that I n determining v a l u e f o r assessment purposes the assessor s h a l l apply the standards and methods of assessment pre s c r i b e d pursuant to The M u n i c i p a l i t i e s Assessment and  E q u a l i z a t i o n A c t and s h a l l assess i n accordance w i t h any r e g u l a t i o n s made under that A c t . 3 ^ and that I n determining the value of land the assessor s h a l l have regard t o : - e) Such other c o n s i d e r a t i o n s as the Assessment Commission 31 may from time to time d i r e c t . The power given to the M i n i s t e r and the Assessment Com missioner i n A l b e r t a i s the power to e s t a b l i s h the b a s i s of assessment and i s consequently a d e l e g a t i o n of the l e g i s l a t i v e f u n c t i o n , s i n c e , as we have seen, i t i s the f u n c t i o n of the l e g i s l a t u r e to e s t a b l i s h the b a s i s of assessment and thereby the incidence of the tax. Once such a ^ Sta t u t e s of A l b e r t a 1957 c. 61 s.6 (1) and s.6(3) (as amended by 1958 c. 50). 3 0 S t a t u t e s of A l b e r t a 1960 C. 5. S. 8 ( 1 ) . 3 1 I b i d . , S. 23. U n d e r l i n i n g added. 71. d e l e g a t i o n i s made, no assessment made i n accordance w i t h the estab l i s h e d p r i n c i p l e s , or w i t h the manual, i f that i s i n the form r e q u i r e d 32 by s t a t u t e , can be de c l a r e d i n c o r r e c t . The Assessment A ct a l s o permits the assessor ( s u b j e c t to the a u t h o r i z a t i o n of the Town or V i l l a g e Council) to use current assess- 33 ments as the assessments f o r the next f o l l o w i n g year. There i s how ever a l i m i t to the number of consecutive occasions on which t h i s can 34 be done. This p r a c t i c e may be common even without such express a u t h o r i t y . Despite the wide powers of d e l e g a t i o n , the A l b e r t a Assessment 35 Manual f a i l s to d e f i n e ' f a i r a c t u a l value' and i t s meaning must be gathered from such statements as: Ba s i c values . . . are based on the assumption t h a t , when s t a t i n g the value of anything i n terms of d o l l a r s , i t i s an expression that the t h i n g valued i s capable of being exchanged f o r the amount of d o l l a r s s t a t e d . This i s c a l l e d replacement or normal v a l u e . 3 ^ W i l l i n g informed s e l l e r s and w i l l i n g informed buyers are assumed i n 37 the values adopted f o r the assessment of land but replacement costs 38 i n Edmonton are used as the b a s i s of the assessments of improvements. 32 P r o v i d i n g that the l e g i s l a t u r e has the power to make t h i s d e l e g a t i o n . 3 3 Statutues of A l b e r t a , 1960 c5. s. 16 ( 1 ) , s. 19. 34 I b i d , s. 16 (2) as amended by 1963 c. 3 s. 7(b). 35 _ _ Government of the Province of A l b e r t a , Assessment Manual (^Edmonton/ Department of M u n i c i p a l A f f a i r s , 1959). 3 6 I b i d . , p. 1. 3 7 I b i d . , S e c t i o n 1, p. 4. f f . and p. 22. 3 8 I b i d . S e c t i o n 1, pp. 2, 33. 72. Although a d i s t i n c t i o n between market value and replacement 39 cost i s recognised by the manual, i t i s provided that where a compo s i t e a p p r a i s a l of land and b u i l d i n g s i s i n e v i t a b l e the t o t a l i s to be s p l i t by deducting the estimated value of the improvements so as t o leave 40 the estimated value of the land. C l e a r l y , h y p o t h e t i c a l values are p r e f e r r e d to market evidence since bare land changes hands on the mar ket but improvements without land do not. I n d i c e s are given i n the Manual f o r the b e n e f i t of the asses sor i n determining the assessments of urban and semi-urban land and a l s o farmland. The assessment of the l a t t e r I s dependent on the estimated 41 p r o d u c t i v i t y of the s o i l w i t h allowances f o r p r o x i m i t y to markets, urban f a c i l i t i e s e t c . , w h i l s t the assessment of the former i s an attempt 42 to estimate the nature and f a c i l i t i e s of a m u n i c i p a l i t y and i s there f o r e an estimate of the demand f o r accomodation i n the m u n i c i p a l i t y . I n the absence of evidence-of market value such i n d i c e s w i l l be d e s i r  able to ensure u n i f o r m i t y of assessment, though i t would be advisable to give the assessors the d i s c r e t i o n to depart from such p r o v i s i o n s 43 when necessary and e s s e n t i a l t h a t the Manual be c o n s t a n t l y r e v i s e d to ensure that such departures, made so as to achieve c o r r e c t n e s s , do 39 I b i d . , S e c t i o n 1, p. 2. 4 0 I b i d . , S e c t i o n 1, p. 5, C f . Survey op. c i t . , p. 24. 4 1 I b i d . , S e c t i o n 5. 4 2 I b i d . , S e c t i o n 1, pp. 22 et seq. 4 3 This i s given — I b i d . , S e c t i o n 1, p. 5. 73. not reduce the u n i f o r m i t y of the assessments. Uniform assessments at the..correct l e v e l of assessment i s the o b j e c t i v e . I n O n t a r i o the M i n i s t e r i s empowered to " p r e s c r i b e r u l e s . . 44 f o r the guidance of assessors" who are re q u i r e d to determine "ac- 45 t u a l value". 46 The Ontario Manual of Assessment Values s t a t e s that: I t has been s a i d that the a c t u a l value of any a r t i c l e , or piece of r e a l e s t a t e i s the amount a w i l l i n g purchaser w i l l pay a w i l l i n g s e l l e r i n the average year chosen from a p e r i o d of the s o - c a l l e d good years and bad years.47 and d e s p i t e t h i s wording i t appears, from a comment by a member at the 48 1958 conference of the Canadian Tax Foundation, that assessments i n Ontario vary w i d e l y from present values. I t has been s a i d t h a t , I n too many cases i n the province i t i s found that assessors do not assess at f u l l a c t u a l value as r e q u i r e d by l e g i s l a t i o n but f o r some reason they assess a t a percentage of value.49 44 Assessment A c t R.S.O. 1960 c. 23, Ss. 21. 93. 4 5 I b i d . S. 35 ( 1 ) . Sections 35 (2) and 35 (4) l a y down the f a c t o r s which are to be considered i n determining a c t u a l value. ^ Government of Ontario. Manual of Assessment Values (sec ond e d i t i o n , Toronto: Department of M u n i c i p a l A f f a i r s , 1954). ^7 i b i d . , p. 1. The assumption of the "average year" may r e s u l t from the terms "normal r e n t a l v a l u e " and "normal s a l e v a l u e " i n the e a r l i e r Assessment A c t R.S.O. 1950 c. 24 Ss. 33(1) and 33(3). 48 D . H . C l a r k and others. "Uniform Assessments" op. c i t . , p. 170. See a l s o W . J . O l i v e r ' s remarks a t p. 144. 4 9 The Ontario M u n i c i p a l Board i n Chapman v. McLeod. /194_>/ O .W.N. 395 at 397. 74. Some exp l a n a t i o n may be obtained from reference to the manual. From the d e f i n i t i o n of value and the acceptance of the income and cost ap- 50 proaches to v a l u a t i o n to the e x c l u s i o n of the comparative approach i t would appear that there i s an attempt to achieve a f i g u r e of normal value. However, i n a r r i v i n g at that f i g u r e c e r t a i n f a c t o r s are taken i n t o account which should not be considered by an assessor. W.J. O l i v e r , who was a t the time a Supervisor of M u n i c i p a l Assessments, sta t e d a t the 1958 conference . . . as long as a b u i l d i n g i s normally w e l l maintained and i s s t i l l being used f o r the purpose f o r which i t was con s t r u c t e d and i s being used to c a p a c i t y and advantage we may w e l l f i n d that there i s very l i t t l e l o s s i n value f o r assess ment purposes e s p e c i a l l y when we consider that the demand f o r  l o c a l s e r v i c e s such as f i r e p r o t e c t i o n may i n some cases i n   crease. 3 1 M u n i c i p a l s e r v i c e s w i l l c l e a r l y i n f l u e n c e the value of r e a l e s t a t e ; since value i s an expression of the worth of f u t u r e b e n e f i t s and the b e t t e r are the s e r v i c e s provided by the m u n i c i p a l i t y and a v a i l a b l e to the landowner the greater w i l l be the worth of h i s property to him, and to a l t e r n a t i v e landowners, ( c e t e r i s p a r i b u s ) . There i s however no plac e i n a v a l u a t i o n f o r an estimate of the cost to the m u n i c i p a l i t y of p r o v i d i n g s e r v i c e s to the property. As shown e a r l i e r , the r e a l property tax i s not l e v i e d on the b a s i s of benefits r e c e i v e d and no c o n s i d e r a t i o n should be had to the s c a l e of l o c a l s e r v i c e s provided except as i t would i n f l u e n c e the mind of a pro s p e c t i v e purchaser. S i m i l a r l y when the manual s t a t e s 50 Manual of Assessment Values, op. c i t . , p. 5. 5 1 "Uniform Assessments", op. c i t . , p. 159 ( u n d e r l i n i n g added). 75. Many m u n i c i p a l i t i e s are a s s e s s i n g the (summer) cottages on one b a s i s only which i s the amount of revenue r e c e i v e d from the 2 or 3 months of occupancy d i s r e g a r d i n g the other con s i d e r a t i o n s . . . such as the l o c a t i o n replacement cost e t c . , and a l s o o v e r l o o k i n g such other angles as the e q u a l i z a t i o n of values between a l l types of property i n the m u n i c i p a l i t y and the s e r v i c e s rendered by the m u n i c i p a l i t y f o r the taxes  which are c o l l e c t e d . ^ I f these s e r v i c e s would i n f l u e n c e the d e c i s i o n of a p r o s p e c t i v e purchaser regarding the amount he would pay f o r such a cottage, they should be c o r r e c t l y considered by the assessor, but he should ignore the r e l a t i v e demands of each p a r c e l of property f o r m u n i c i p a l s e r v i c e s . I n c o n s i d e r i n g the assessment of farm lands the manual s t a t e s that acreage-rating-values have been placed on a moderate b a s i s because 53 farms would otherwise be s u f f e r i n g considerable hardship. Such a c o n s i d e r a t i o n i s the p r e r o g a t i v e of the l e g i s l a t u r e and i t must not be l e f t to the assessor to e s t a b l i s h the incidence of t a x a t i o n which he considers d e s i r a b l e . The manual i s made under the a u t h o r i t y of the Min i s t e r and although he may not be exceeding h i s a u t h o r i t y i n so estab l i s h i n g the r a t i n g v a l u e s , such' a p r o v i s i o n i n the manual may i n f l u e n c e the assessors to depart from the s t a t u t o r y p r o v i s i o n s . I n B r i t i s h Columbia the p r o v i n c i a l Assessment Manual a s s i s t s the assessor i n determining market value. The^manual r e s t r i c t s i t s e l f to e x p l a i n i n g the use o f ; and the f a c t o r s a f f e c t i n g ; the income and cost approaches and to p r o v i d i n g cost data. However, i t leaves w i t h 52 Manual of Assessment Values, op. c i t . , p. 51, ( u n d e r l i n i n g added). 5 3 I b i d . , p. 29. 76. the assessor the s e l e c t i o n of the c o r r e c t method and d i s c r e t i o n regard i n g the determination of value. This d i s c r e t i o n i s required i f the assessor i s to execute 54 h i s f u n c t i o n s c o r r e c t l y . Summary I n Canada the adopted b a s i s of assessment may d i f f e r from a market value concept. S t a t i s t i c a l i n v e s t i g a t i o n s w i l l not i n d i c a t e the cause but i t has been seen that an assessment manual can s p e c i f y a d i f f e r e n t b a s i s of assessment. Such manuals sometimes have the same fo r c e as l e g i s l a t i o n , the law making f u n c t i o n having been delegated. I n other cases, such as B r i t i s h Columbia i t provides guidance to the assessor i n c a r r y i n g out the d i s c r e t i o n given him by s t a t u t e . This i s a l s o a j u d i c i a l requirement. See Dugas v. Macfarlane, (1911), 18. W.L.R. 701. T u r n b u l l Real E s t a t e Co. v. Sewell. _/1937/2 D.L.R. 218. Re Assessment A c t and Nelson and F o r t Sheppard Railway Co. (1904) 10. B.C.R. 519. Sun L i f e Ass. Co. v. Montreal. /_1952,/2 D.L.R. 81, 100. CHAPTER V UNIFORMITY OF TREATMENT I n order to a s c e r t a i n the weight that ought to be accorded to each of the ( p o s s i b l y c o n f l i c t i n g ) requirements of conformity w i t h the s t a t u t o r y p r o v i s i o n s r e l a t i n g to the b a s i s of assessment and the achievement of e q u a l i t y of treatment, the s t a t u t o r y and j u d i c i a l p r o v i  sions r e l a t i n g to e q u a l i t y and u n i f o r m i t y of treatment w i l l be con side r e d . The p r o v i s i o n s r e l a t i n g to u n i f o r m i t y are r e l e v a n t to e q u a l i t y as, i n a d d i t i o n to the d i f f e r i n g i n t e r p r e t a t i o n s that can be placed on each of these phrases, i t must be presumed that a s t a t u t o r y or j u d i c i a l requirement of u n i f o r m i t y , without q u a l i f i c a t i o n , r e f e r s to u n i f o r m i t y at the;:statutory b a s i s of assessment. I n t h i s case, e q u a l i t y of t r e a t  ment and u n i f o r m i t y are synonymous. Where no p r o v i s i o n f o r u n i f o r m i t y or equality of treatment e x i s t s , each assessment ought to be made i n accordance w i t h the s t a t u  t o r y b a s i s of assessment and the achievement of e q u a l i t y w i l l depend on the correctness of the assessments. I n a case where there has been a departure from c o r r e c t n e s s , e q u a l i t y w i l l only be achieved where each assessment i s uniformly wrong. Each assessment w i l l however, be l i a b l e to c o r r e c t i o n and the e q u a l i t y of the assessment r o l l w i l l consequently be r e l a t i v e l y unstable. Where s t a t u t o r y or j u d i c i a l p r o v i s i o n f o r u n i -78. fortuity of treatment e x i s t s , the j u d i c i a r y , and the assessors (who must f o l l o w the d e c i s i o n s of the Courts i f t h e i r assessments are to be acceptable on appeal), w i l l be faced w i t h these c o n f l i c t i n g requirements. Where no such p r o v i s i o n e x i s t s the j u d i c i a r y , and t e c h n i c a l l y , the as sessors, would not be faced by t h i s c o n f l i c t . There only correctness i s r e q u i r e d . A) England and Wales — S t a t u t o r y P r o v i s i o n s . U n t i l 1948 the achievement of u n i f o r m i t y of v a l u a t i o n was the expressed i n t e n t i o n of S t a t u t e s r e l a t i n g to the property tax and the existence of i n e q u a l i t y or u n f a i r n e s s i n the assessments was a proper reason f o r an appeal. 1 I n the P a r o c h i a l Assessments A c t 1836, designed to achieve 2 a "Uniform mode of R a t i n g " appeal to the J u s t i c e s of the P e t t y Sessions, against a Rate, l a y on the grounds of " i n e q u a l i t y , u n f a i r n e s s or i n c o r  r e c t n e s s " i n the v a l u a t i o n s . The J u s t i c e s had the a u t h o r i t y to enquire i n t o the t r u e value of the property and a l s o i n t o the f a i r n e s s of the 3 assessment. 4 The Union Assessment Committee A c t 1862 was enacted to se- 5 cure "uniform and c o r r e c t v a l u a t i o n s " which were to be achieved through 1 Great B r i t a i n . 76 S t a t u t e s A t Large. 6 and 7. W i l l 4. c.96. 2 I b i d , preamble. 3 I b i d , s.6. 4 Great B r i t a i n . 102 S t a t u t e s a t Large. 25 and 26 V i c t , c.103. ~* I b i d , preamble. 79. 6 the a c t i o n s of the Assessment Committees. Appeals could be made against the l i s t by any Overseer or by "any Person who may f e e l himself aggrieved by any V a l u a t i o n L i s t on the Ground of Unfairness or Incor- 7 rectness . . .". S i m i l a r appeal p r o v i s i o n s e x i s t e d i n the V a l u a t i o n ( M e t r o p o l i s ) 8 A c t 1869 which r e l a t e d to assessments i n London. 9 The i n t e n t i o n of the R a t i n g and V a l u a t i o n A c t 1925 was a l s o to "promote u n i f o r m i t y i n the v a l u a t i o n of property f o r the purpose of 10 r a t e s " and to th a t end the County V a l u a t i o n Committees were r e q u i r e d to take steps to promote " u n i f o r m i t y i n the p r i n c i p l e s and p r a c t i c e 11 of v a l u a t i o n " and appeals against a d r a f t l i s t , or proposals to amend a cur r e n t l i s t could be made by "any person . . . aggrieved by the i n - 12 correctness or u n f a i r n e s s of any matter . . ." & c . Although the i n t e n t i o n of t h i s l e g i s l a t i o n was to achieve u n i f o r m i t y of assessment no preference was given to e i t h e r u n i f o r m i t y s. 11. b I b i d , s. 16. 7 l h i d - s - 1 8 - 8 Great B r i t a i n L.R. S t a t u t e s . V o l . IV. 32 and 33 V i c t . c. 67 9 Great B r i t a i n . L.R. Stat u t e s 15 and 16 Geo. 5. c. 90. 1 0 l h ± d - T i t l e . 1 1 I b i d . S. 18 ( 2 ) . 1 2 I b i d . Ss. 26 (1) and 37(1). 80. ( u n f a i r n e s s ) or correctness and i t was l e f t to the Courts to pronounce on t h e i r r e l a t i v e importance. 13 I n 1948 the L o c a l Government A c t reenacted these p r o v i s i o n s . The words ' u n f a i r n e s s 1 , ' i n c o r r e c t n e s s ' or ' u n i f o r m i t y ' do not now appear i n the t i t l e or i n the p r o v i s i o n s r e l a t i n g to v a l u a t i o n or R a t i n g Pro- 14 cedure. Consequently i t i s no longer s u f f i c i e n t f o r an appeal to be made on t h e grounds of u n f a i r n e s s or l a c k of u n i f o r m i t y . However, the A c t of 1948 provides f o r the submission of a proposal f o r the a l t e r a - - t i o n of an assessment by "any person who i s aggrieved . . . by any value 15 a s c r i b e d i n the l i s t . . .". I n e f f e c t , the p r o v i s i o n s of the 1948 A c t r e l a t i n g to appeals are as wide as those that e x i s t e d p r i o r to i t s enactment. 16 Sections 17 and 18 of the L o c a l Government A c t 1966 i n t r o  duced s t a t u t o r y a u t h o r i t y f o r 'tone of the l i s t ' v a l u a t i o n s . The t e x t of these s e c t i o n s does not i n c l u d e the phrase "tone of the l i s t " , but i t i s provided that the value i s not to exceed t h a t which would be *-3 Great B r i t a i n . L.R. S t a t u t e s 11 and 12 Geo. 6. c. 26. 1 4 See Ss. 36(1) and 40(1). 1 5 I b i d - s- 3 6 (repealed) and S. 40(1). Halsbury's St a t u t e s (2nd Ed.) I n t e r i m S e r v i c e p. 69, c. 42. See Appendix A. 81. appropriate i f the premises e x i s t e d i n the year p r i o r to the i n t r o d u c  t i o n of the v a l u a t i o n l i s t ; and t h e r e f o r e f e l l to be valued w i t h the r e s t of the premises i n the l i s t . W h i l s t i t was intended that the new assessment should be made 17 on the same l e v e l of values as were adopted f o r other assessments, the wording used w i l l not ensure that r e s u l t . S e c t i o n 17 s p e c i f i e s a maximum f i g u r e of v a l u e , and w h i l s t i t might achieve the d e s i r e d o b j e c t i v e i n a time of i n c r e a s i n g v a l u e s , i n a p e r i o d of depression or i n a p a r t i c u l a r area where values are f a l l  i n g i t would enable the assessor to enter new or a l t e r e d premises at a l e v e l of value below that e x i s t i n g f o r other assessments. More s i g n i f i  c a n t l y , however, i t does not r e s o l v e the c o n f l i c t between u n i f o r m i t y and accuracy where assessments i n the l i s t d i f f e r from those that would have e x i s t e d had each assessment been made i n accordance w i t h the pre s c r i b e d b a s i s of assessment at the date of the i n t r o d u c t i o n of the l i s t . I n such a case there w i l l remain the o r i g i n a l choice between the achievement of u n i f o r m i t y (which w i l l be the r e s u l t of a s s e s s i n g on the tone of the l i s t ) , and the production of c o r r e c t assessments (being assessments based on the l e v e l of values that ought to have been adopted at the i n t r o d u c t i o n of the l i s t ) . The discrepancy of two or more years between the e s t a b l i s h  ment of the l e v e l of values to be adopted and the i n t r o d u c t i o n of the 17 See Mr. Crossman's remarks, Great B r i t a i n Parliamentary  Debates (Commons) op. c i t . , DCCXXIX (1966) 1265; and Lord Rennet's com ments, Great B r i t a i n , Parliamentary Debates (Lords) op. c i t . , CCLXXII (1966) 436. 82. l i s t w i l l make t h i s c o n f l i c t even more l i k e l y , p a r t i c u l a r l y i n periods of r a p i d l y changing v a l u e s . Even i f t h i s c o n f l i c t does not a r i s e , and i f the new assess ment i s at the same l e v e l of value as that i n the l i s t , i d e n t i c a l ad j o i n i n g premises may have d i f f e r e n t assessments.. The A c t r e q u i r e s that the current amenities of the l o c a l i t y be assumed, yet i n c e r t a i n areas they may have changed since the i n t r o d u c t i o n of the l i s t without r e - 18 v i s i o n of the assessments. To consider those changes i n the new assessment, but not i n those already i n the l i s t would r e s u l t i n d i s  c r i m i n a t o r y treatment of new assessments. B) England and Wales — J u d i c i a l P r o v i s i o n s . The removal i n 1948 of the s t a t u t o r y p r o v i s i o n s r e l a t i n g to u n f a i r n e s s has not been of great s i g n i f i c a n c e , since the Courts had pre v i o u s l y decided cases concerning the c o n f l i c t between correctness and u n i f o r m i t y and t h e i r d e c i s i o n s were followed a f t e r the enactment of the 1948 A c t . I t has long been accepted by the Courts that e q u a l i t y of 19 treatment i s a fundamental requirement of the r e a l property tax, 18 See, f o r example, Winkler v. Cowle. (1952) 45 R. and l . T . 504. 1 9 R. v. Mast. (1795) 6 T.R. 154; 101 E.R. 485. See a l s o , R. v. Adams (1832)_4 B_ & Ad. 61, 66; 110 E.R. 378, 380; Double v.  Southampton A.C. /1922/ 2 K.B. 213, 225; Poplar A.C. v. Roberts /1922/ 2 A.C. 93, 109, 119; S t i r k and Sons L t d . v. H a l i f a x A.C. /1922/1 K..B. _ 264, 274; L a d i e s Hosiery & Underwear L t d . v. West Middlesex ATC. /1932/ 2 K.B. 679, 688. 83. and i n 1964 Mr. J u s t i c e Widgery expressed the opinion that an assessor should " h e s i t a t e to d i s t u r b the f a i r n e s s and e q u a l i t y of h i s o r i g i n a l l i s t by g i v i n g e f f e c t to evidence of a l t e r e d value which comes to him 20 too l a t e to be r e f l e c t e d i n the l i s t as a whole." I n the l i g h t of the p r o v i s i o n s of L o c a l Government A c t 1948 r e l a t i n g to appeals, the r e c o g n i t i o n by the Lands T r i b u n a l of the p r i n c i p l e of u n i f o r m i t y i s apparent i n t h e i r acceptance of tone of the l i s t assessments between 1948 and 1956, and subsequently. I n 1954 J.L. M i l n e Esq., a member of the Lands T r i b u n a l commented E q u a l i t y of r a t i n g being a main o b j e c t , a v a l u a t i o n o f f i c e r , when preparing or r e v i s i n g h i s v a l u a t i o n l i s t , should c o n s i  der a l l such evidence as i s a v a i l a b l e and then, by the ex e r c i s e of h i s s k i l l and judgement a s c e r t a i n an assessment f o r each separate hereditament on a uniform b a s i s . 2 ^ . P r e v i o u s l y , however, the T r i b u n a l had decided t h a t " u n f a i r n e s s " was no longer a s t a t u t o r y ground of o b j e c t i o n to an assessment and that i t s duty was to found i t s d e c i s i o n on the p r o v i s i o n s of the 1925 A c t r e l a t i n g to gross v a l u e , "even i f t h i s may r e s u l t i n a f i g u r e i n excess 22 of the general tone of the l i s t " . — _- R- v- Paddington V.O., ex parte Peachey Property Corporation  L t d . , /1964/ 3 A l l E.R. 200, 216. 2 1 K i m b e l l s L t d . v. Payne (V.O.) (1954) 47 R. and I.T. 255, .259. OO E r s k i n e Symes Esq., and CH. B a i l e y Esq., i n Gloucester  County Borough C o u n c i l and Wessex Freeholds (Gloucester) L t d . v. Tre- v a i l . (1952) 45 R. and I.T. 422, 426. 84. In. order to be able to implement a p o l i c y of m a i n t a i n i n g u n i  f o r m i t y or e q u a l i t y of treatment, the Courts must have the power to consider assessments other than those under appeal. However, the a b i l i t y to consider other assessments w i l l not a u t o m a t i c a l l y imply an i n t e n t i o n to achieve u n i f o r m i t y or e q u a l i t y . The Courts have on many occasions recognized t h e i r a b i l i t y to 23 r e f e r to the assessments of comparable p r o p e r t i e s , and i n P o i n t e r ' s case, Lord A t k i n expressed the o p i n i o n that evidence of the r a t e a b l e value must be a d m i s s i b l e , and f o r two reasons. I n the f i r s t place i n cases i n which both pre mises are i n the same Union i t i s evidence against the Asses sment Committee i n the nature of an admission. And secondly i t may be the only way i n which you can get at the r e n t at which the a p p e l l a n t ' s premises are worth to be l e t by the year.24 The f i r s t of Lord A t k i n ' s reasons may be more s i g n i f i c a n t now that assessments are made by the I n l a n d Revenue's V a l u a t i o n O f f i  c e r s . Consequently comparisons w i l l not be r e s t r i c t e d to a s i n g l e r a t i n g area, but an assessment can be considered an admission against 25 the V a l u a t i o n O f f i c e r concerned and against a l l other O f f i c e r s . 23 P o i n t e r v. Norwich A.C. flsilf 2 K.B. 47. 471.; Ladies  Hosiery and Underwear L t d . v. West Middlesex A.C. /1932/ 2 K.B. 679, 687; See a l s o Hunter v. Swindon A.C. /192j_7_2 K__B. 630; and Stockbridge  M i l l Co. L t d . v. C e n t r a l Land Board. _1954/ 2 A l l E.R. 360. C f . Mason v. CL.B. (1952) 3 P. and CR. 31; 46 R. and l . T . 314. 2 4 I B I D - > P- #7-7. Shrewsbury Schools v. Shrewsbury B.C. and Plumpton. (V.O.) (1960) 53 R. and l . T . 497, 500. 85. The second reason f o r r e f e r r i n g to comparable assessments i s based on the assumption that c u r r e n t assessments are r e p r e s e n t a t i v e of s t a t u t o r y v a l u e s . I f t h i s i s not the case the use of other assess ments to e s t a b l i s h the l e v e l of value f o r new assessments w i l l r e s u l t i n tone of the l i s t assessments. I n some cases i t may be p o s s i b l e to t e s t t h i s assumption by the comparison of e x i s t i n g assessments and other evidence of s t a t u t o r y value. Where t h i s evidence lends support to the assumption, there w i l l be greater v a l i d i t y f o r the use of other assessments than where the evidence tends to disprove i t or where there i s no other evidence a v a i l  able. However, i n the f i r s t case the use of assessments as evidence of value w i l l be l e s s e s s e n t i a l since there i s other b e t t e r evidence a v a i l a b l e . I n the second case the assessments should, i f correctness,;- i s wanted, be disregarded. I t i s only i n the t h i r d case, where no other s a t i s f a c t o r y evidence i s a v a i l a b l e , t h a t there i s a need to adopt assessments as evidence of value . T h e i r adoption i s however dependent on the unsubstantiated assumption that the assessments are representa t i v e of s t a t u t o r y v a l u e . I f t h i s were so the c o n f l i c t between c o r r e c t  ness and u n i f o r m i t y would not a r i s e . There i s a t h i r d reason f o r c o n s i d e r i n g other assessments and tha t i s to ensure t h a t there i s u n i f o r m i t y of assessment. I n t h i s case, evidence of S t a t u t o r y values i s immaterial since only u n i f o r m i t y and not c orrectness i s r e l e v a n t . 86. The f i r s t and t h i r d reasons f o r c o n s i d e r i n g other assessments are somewhat s i m i l a r since the e f f e c t of both i s to produce u n i f o r m i t y of treatment and since both may r e q u i r e t h a t other a v a i l a b l e evidence be ignored. Yet d i f f e r e n t motives are in v o l v e d . To consider other assessments as admissions by the assessor, i n d i c a t e s an attempt to d i s  cover s t a t u t o r y value. I n so doing i t i s assumed that only one l e v e l of values can e x i s t , and that t h a t a p p l i e s to a l l s i m i l a r p r o p e r t i e s . By making an assessment the assessor i s expressing h i s o p i n i o n of s t a  t u t o r y value. I f he does not amend i t , i t i s presumed to be c o r r e c t and he i s prevented from impugning h i s own estimate of value. He cannot t h e r e f o r e b r i n g evidence to show that i t i s i n c o r r e c t . The aim i s to e s t a b l i s h s t a t u t o r y v a l u e , the r e s u l t i s to achieve u n i f o r m i t y . The weight to be accorded to the assessments of other proper t i e s w i l l depend on the purpose f o r which they are being considered, and on the circumstances of each case. This has been recognised by 26 the Courts. Although the c o n s i d e r a t i o n of other assessments has been ad mi t t e d , the importance of u n i f o r m i t y of treatment r e l a t i v e to that of corr e c t n e s s has been l i m i t e d by d e c i s i o n s of the Courts. I t has been held that a t a x i n g s t a t u t e must not be univer- 27 s a l l y m i s a p p l i e d to achieve f a i r n e s s of treatment and that u n i f o r m i t y / b P o i n t e r v. Norwich A.C. /I922? 2 K.B. 47. 471.; Ladies  Hosiery and Underwear L t d . v. West Middle'sex A.C. /1932/ 2 K.B. 679; Neath Sheet S t e e l and G a l v a n i s i n g Co. L t d . v. Neath Area A.C. (1942) 36 R. and I.T. 50; 14. D.R.A. 65. See R a t i n g and Income Tax, op. c i t . , XLV, 702. 2 7 Trustees of Archdiocese of C a r d i f f v. Pontypridd A.C. (1930) 94 J.P. 246, 248; 12 R. and I.T. 275. 87. must be achieved by c o r r e c t i n g i n a c c u r a c i e s . Correctness must not be 28 s a c r i f i c e d i n order to ensure u n i f o r m i t y , s i n c e , i n the/.words of S l e s s e r J . . . . I f i n d i t q u i t e impossible to hold that the mandatory requirements of the R a t i n g and V a l u a t i o n A c t as to the assess ment of gross value i n a p a r t i c u l a r case can be avoided or modified by a c o n s i d e r a t i o n of unfairness.^9 As the r e s u l t of the d e c i s i o n . i n the Ladies Hosiery case and two subsequent d e c i s i o n s , u n f a i r n e s s between assessments of p r o p e r t i e s 30 of the same c l a s s , between assessments of d i f f e r e n t c l a s s e s of proper- 31 32 t y , or between assessments i n d i f f e r e n t d i s t r i c t s ceased to be of any p r a c t i c a l b e n e f i t to ratepayers as the grounds f o r an appeal against 33 a v a l u a t i o n l i s t . D espite these p r o v i s i o n s , the acceptance of the - p r i n c i p l e of the tone of the l i s t by the Lands T r i b u n a l i n d i c a t e s that there, at l e a s t , the c o n f l i c t has not been re s o l v e d . I n the High Court i t may be that the d e c i s i o n of the Court of Appeal i n the Ladies Hosiery Case.(et. a l . ) and the p r o v i s i o n s of the 1925 A c t would be combined to exclude ~Z Z Ladies Hosiery and Underwear L t d . v. West Middlesex A.C. A932/ 2 K.B. 679, 688. 2 9 I b i d . , a t p. 694. 3 0 I b i d . 3 1 L i l l e y and Skinner L t d . v. Essex C.V.C. /1935/ A l l E.R. Rep. 54 C f . Hunter v. Swindon A.C. /J.922/2 K.B. 630; which i s not a p p l i c a b l e to the procedure under the 1925 A c t . 3 2 R. v. Cornwall C.V.C Ex parte Falmouth R.A./19377 2 K.B. 222, C f . Double v. Southampton A.C. /1922/ 2 K.B. 213; which i s not a p p l i c a b l e to the procedure under the 1925 A c t . Ryde on R a t i n g op. c i t . , p. 393. 88. c o n s i d e r a t i o n of u n i f o r m i t y when i t would be to the detriment of c o r r e c t  ness. I n the Lands T r i b u n a l however there i s no c l e a r i n d i c a t i o n that e i t h e r w i l l predominate. C) Canada -- S t a t u t o r y P r o v i s i o n s . U n i f o r m i t y of treatment as between assessments i s a common s t a t u t o r y requirement i n Canada and reference to other assessments can g e n e r a l l y be made on two grounds, the establishment of s t a t u t o r y value, and the achievement of u n i f o r m i t y . I n B r i t i s h Columbia i t i s intended to achieve both u n i f o r  m i t y and e q u a l i z a t i o n of assessments and the Assessment E q u a l i z a t i o n  A c t makes p r o v i s i o n f o r both. We are however, only concerned w i t h those r e l a t i n g to u n i f o r m i t y . The Assessment Commissioner i s empowered to g i ve advice and a s s i s t a n c e to Assessors f o r the purpose of securing 36 u n i f o r m i t y i n assessments. On appeals against assessments, the Assessment Appeal Board i s empowered to vary the appealed assessment where e i t h e r (a) the value at which an i n d i v i d u a l p a r c e l under considera t i o n i s assessed does not bear a f a i r and j u s t r e l a t i o n to the value at which other land and improvements are as sessed i n the m u n i c i p a l c o r p o r a t i o n or r u r a l area i n which i t i s s i t u a t e ; o r (b) the assessed values of such land and improvements are i n excess of the assessed value as p r o p e r l y determined un der S e c t i o n 3 7 . 3 7 34 J.H. P e r r y op. c i t . p. 265. 3 5 Post. 3 6 Assessment E q u a l i z a t i o n A c t , R.S.B.C. I960 c. 18 s. 7(b). 3 7 I b i d . S. 46 (1) (as amended by 1961. c. 3. S. 6.). 89. There are thus two grounds of appeal against assessments i n B r i t i s h Columbia; i n c o r r e c t n e s s and u n f a i r n e s s . The former i s r e s  t r i c t e d to cases of overassessment w h i l s t the l a t t e r i s a p p l i c a b l e to both assessments that exceed the general l e v e l of values and those that are below i t . The two are independent of each other and i t i s not nec essary to prove i n c o r r e c t n e s s i n order to succeed on the ground of un- 38 f a i r n e s s (and v i c e versa) though on an appeal the r e v i s e d assessment must be both f a i r and j u s t i n r e l a t i o n to the assessment of other l i k e 39 p r o p e r t i e s and not i n excess of a c t u a l value. S i m i l a r p r o v i s i o n s e x i s t i n The M u n i c i p a l A c t . The Courts of R e v i s i o n are c o n s t i t u t e d to adjudicate on the assessment r o l l and there by create assessments that are f a i r and e q u i t a b l e and f a i r l y represent 40 a c t u a l v a l u e s . Consequently i t i s enacted t h a t , The assessment of property complained against s h a l l not be v a r i e d i f the value at which i t i s assessed bears a f a i r and ; 3". j u s t r e l a t i o n to the value at which s i m i l a r or neighbour ing property i n the m u n i c i p a l i t y i s assessed.41 J 0 C f . the wording of the A c t of 1953 (2nd Sess. c. 32) and the d e c i s i o n s r e s u l t i n g therefrom: Pearce v. C i t y of New Westminster. (1958) Stated Cases, op. c i t . , p. 49, 52; Vancouver v. Township of  Richmond. (1958) 17 D.L.R. (2d) 548, 553; Home Coal Co. L t d . v. Cor p o r a t i o n of D e l t a . (1960) Stated Cases, op. c i t . , p. 80, 82. 3 9 Re Rowan's Appeal (1962) 40 W.W.R. 627, 629. 40 M u n i c i p a l A c t . R.S.B.C. 1960. c. 255 s. 356 (1) ( b ) . I b i d , s. 356 ( 4 ) . 90. These p r o v i s i o n s are subject to those of the Assessment E q u a l i z a t i o n A c t and i t i s s p e c i f i e d that S e c t i o n 46(1) of that A c t ( i n t e r a l i a ) a p p l i e s to appeals to the Assessment Appeal Board under the M u n i c i p a l 42 43 A c t and under the Vancouver Charter. Other provinces have enacted p r o v i s i o n s s i m i l a r to those of B r i t i s h Columbia. Saskatchewan s p e c i f i e s that "the dominant and con t r o l l i n g f a c t o r i n the assessment of land and b u i l d i n g s s h a l l be equity,' and that assessments s h a l l not be v a r i e d on appeal, even though they appear to be more or l e s s than the f a i r value;, i f the assessment "bears a f a i r and j u s t p r o p o r t i o n to the value a t which other . . . (premises) 45 are assessed." Here i t would appear that u n i f o r m i t y of assessment i s para mount and th a t i n c o r r e c t n e s s alone i s inadequate to support an appeal 46 against an assessment. I n A l b e r t a too i t would appear that u n i f o r m i t y of assessment 47 i s paramount. The Assessment A c t r e f e r s to standards, methods of I b i d . , sT~361(3) . Vancouver Charter Amendment A c t 1964. c. 72 s. 13. 4 4 The C i t y A c t R.S.S. 1965 c. 147 s. 456(1); The Town A c t R.S.S. 1965 c. 148. s. 423(1); The V i l l a g e A c t R.S.S. 1965 c. 149. s. 293(1); R u r a l M u n i c i p a l i t y A c t R.S.S. 1965. c. 150 s. 292(1). 4 5 I b i d . Sections 456(12); 423(10); 293(11) and 292(16) r e s p e c t i v e l y . 4 6 C f . Rosborough v. C i t y of Regina. _19347 2 W.W.R. 636 post.p. 96. 47 Statu t e s of A l b e r t a 1960 c. 5. 91. assessment and r e g u l a t i o n s p r e s c r i b e d by the M i n i s t e r and Assessment 48 Commissioner as the b a s i s of assessment. However i n the absence of such p r o v i s i o n s the assessor i s r e q u i r e d to assess i n a manner that i s e q u i t a b l e and uniform w i t h assess ments of that and other kinds of property throughout the m u n i c i p a l i t y . 4 9 This p r o v i s i o n gives s t a t u t o r y a u t h o r i t y f o r tone of the l i s t assess ments i n a d i f f e r e n t and more e f f e c t i v e manner than that enacted f o r England and Wales i n the L o c a l Government A c t . On appeal too, u n i f o r m i t y i s paramount. I t i s enacted that A Court of r e v i s i o n s h a l l not vary the assessments of any property where the value at which i t i s assessed i s i n f a i r and j u s t p r o p o r t i o n w i t h the values at which other property i n the m u n i c i p a l i t y i s assessed.50 The A l b e r t a P r o v i n c i a l Assessment Manual which has the f o r c e 51 of law d e s c r i b e s the assessor's f u n c t i o n as to "make a f a i r and 52 j u s t e v a l u a t i o n f o r assessment purposes." This d e s c r i p t i o n i s s i g  n i f i c a n t i n the absence of a c l e a r d e f i n i t i o n of the b a s i s of assess ment. -ZT8- Supra. 4 9 Statutes of A l b e r t a 1960 c. 5. s. 8(2). 5 0 I b i d . , s. 42. 5 1 Assessment A c t 1960 c. 5 ss. 8(1), 23 ( e ) ; The M u n i c i p a l  i t i e s Assessment and E q u a l i z a t i o n Act 1957 c. 61 s. 6. Supra. ^ 2 Government of the Province of A l b e r t a . Assessment Manual  op. c i t . , S e c t i o n 1, p. 2. 92. I n Ontario i t i s enacted, that the Judge, Board, or Court may i n determining the value at which any land s h a l l be assessed have reference to the value at which s i m i l a r land i n the. v i c i n i t y i s assessed. This p r o v i s i o n i s permissive not mandatory. I n On t a r i o , as i n B r i t i s h Columbia the assessors are empowered to consider "any other circumstances 54 a f f e c t i n g the value" when determining a c t u a l value and the assessments of other premises are included i n such a p r o v i s i o n . They are however to be considered as j u s t one item of evidence i n a s c e r t a i n i n g a c t u a l 55 v a l u e ; and not to e s t a b l i s h uniform but i n c o r r e c t assessments;. Consequently the Court i s given the power to look at the assessments of s i m i l a r land f o r the purpose of e s t a b l i s h i n g a c t u a l value but not f o r the purpose of ac h i e v i n g u n i f o r m i t y of assessment (other than a t a c t u a l v a l u e ) . Appeals w i l l t h e r e f o r e not be on the ground 56 of u n i f o r m i t y . I n p r a c t i c e , however, these p r o v i s i o n s may f o s t e r u n i f o r m i t y of assessment. Assessments:;will not, i n the short run, a f f e c t the value of pr o p e r t i e s except i n so f a r as t h e i r burdens of t a x a t i o n are a f f e c t e d a3 Assessment A c t B..S.O. 1960 c. 23. s. 86(2). 5 4 I b i d . , Ss. 35 (2) and 35(4). 5 5 Dreyfus v. Royds. /_92l7 1 W.W.R. 769, 771, 776. 5 6 Fran-Robert L t d . v. C i t y of Ottawa. JJ.956J O.W.N. 807, 808. See a l s o Re H a l i f a x F i r e Ass. Co. and C i t y of Toronto (1939) 9 F.L.J. 106. but c f . Re A l l e n and Town of Miminco (1920) 19 O.W.N. 150 and Chapman v. McLeod. A949./ O.W.N. 395. 93. by the s i z e of the assessments, and the bids of pros p e c t i v e occupiers are a f f e c t e d by s i z e of a n t i c i p a t e d tax b i l l s . Consequently the r e f e r  ence to other assessments w i l l be dependent on one of three assumptions. F i r s t l y , that by r e f e r r i n g to the r e l a t i v e tax burdens of d i f f e r e n t p r o p e r t i e s some i n d i c a t i o n of t h e i r e f f e c t on pros p e c t i v e purchasers' bids can be obtained. Secondly that the other assessments are repre s e n t a t i v e of a c t u a l value or t h i r d l y , that uniform assessments w i l l be accepted without reference to t h e i r c o rrectness. The l a s t assumption runs counter to the d e c i s i o n s of the Court, w h i l s t the f i r s t endeavours to a s c e r t a i n value from j u s t one of i t s determinants, and w i l l not, of i t s e l f , provide s u f f i c i e n t informa t i o n f o r an estimate of value to be made. Consequently t h e i r v a l i d i t y must be suspect. The u n c o n d i t i o n a l acceptance by the Court, and there f o r e by the assessors, of the second assumption that assessments are r e p r e s e n t a t i v e of a c t u a l value w i l l r e s u l t i n the adoption of uniform 57 assessments. I n c o n t r a s t to the Ontario p r o v i s i o n s , the Nova S c o t i a Assess ment Act contains a mandatory requirement of the c o n s i d e r a t i o n of other assessments f o r the purpose of ensuring that t a x a t i o n f a l l s i n a uniform 58 manner upon a l l r e a l and personal property. 57 Supra,p. 85. 5 8 R.S.N.S. 1954 c. 15 s. 18, r u l e 2. ( r e c a s t 1966 c. 3 s. 38). See Re Manning Assessment /1942/ 1 D.L.R. 383; Glace Bay v. Seaboard  Power Corp. L t d . /1952/ 2 D.L.R. 826; Mersey Paper Co. v. C i t y of  Queens (1959). 18 D.L.R. (2d) 19, 28-30. 94. D) Canada — J u d i c i a l P r o v i s i o n s . According to F i n n i s the Courts i n Canada "have been more con cerned w i t h the equity of one property assessment when compared w i t h another of the same c l a s s i f i c a t i o n r a t h e r than w i t h the l e v e l of value 59 i t s e l f " but there i s no c l e a r i n d i c a t i o n i n the d e c i s i o n s of the Courts as to the r e l a t i v e importance of correctness and u n i f o r m i t y . Mr. J u s t i c e Kerwin i n the Supreme Court of Canada commented that The assessors must of course proceed so as to cause no d i s  c r i m i n a t i o n but i t i s a l s o J_he_Lr duty to see that every r a t e  payer i s assessed f o r i t s /_sic/ immoveables a t t h e i r a c t u a l v a l u e . 6 0 This comment i s c h a r a c t e r i s t i c of the d e c i s i o n s of the Courts i n Canada since i t admits the existence of the c o n f l i c t but f a i l s t o provide an a u t h o r i t a t i v e guide to the p o l i c y to be followed. I n B r i t i s h Columbia evidence of other assessments can be considered under the p r o v i s i o n s of S e c t i o n 37(1) of the Assessment Equal i z a t i o n A c t i n a r r i v i n g at a c t u a l value and consequently a measure of un i f o r m i t y can be produced even d i s r e g a r d i n g the p r o v i s i o n s of Se c t i o n 46(1). Mr. J u s t i c e Sheppard i n commenting that I t i s not disputed that those a d j o i n i n g lands, having been assessed "at t h e i r a c t u a l v a l u e " o f f e r some evidence of the " a c t u a l v a l u e " of the lands i n question and there f o r e were pr o p e r l y considered under the s e c t i o n as "other circumstances a f f e c t i n g the value". 6''" .H. F i n n i s . "Uniform Assessments" op. c i t . , p. 149. 6 0 Sun L i f e Ass. Co.. L t d . v. Montreal /195o7 2 D.L.R. 785, 795. 6 1 Vancouver v. Township of Richmond. (1958) 17 D.L.R. (2d) 548, 551. See a l s o I n Re M u n i c i p a l A c t and Dixon (1939-40) 55 B.C.R. 546, 551-2. 95. has made e x p l i c i t the inherent assumption i n v o l v e d i n t h i s procedure, but w h i l e he has st r e s s e d the permissive nature of the s e c t i o n , he omit ted to ccraiment whether such c o n s i d e r a t i o n could be made i f the inherent assumption were disproved, or i f the a c t u a l value of the property could be adequately estimated by reference to other sources of inf o r m a t i o n . I n the e a r l i e r case of C.N.R. v. Vancouver i t was decided that the assessor could not ignore v a l u a t i o n s of other lands, but that "the f a c t that other r a i l w a y lands are assessed at a c e r t a i n f i g u r e i s 62 f a r from c o n c l u s i v e i n i t s e l f . " Hence other assessments were accept able as evidence but t h e i r usefulness i n determining a c t u a l value had 63 to be e s t a b l i s h e d . 64 I n c o n t r a s t , i n B e l l I r v i n g v. C i t y of Vancouver i t was decided t h a t under the express p r o v i s i o n s of the Vancouver I n c o r p o r a t i o n  A c t 1921 (now repealed) appeals were l i m i t e d to the question of u n i  f o r m i t y of assessment and that the f a i r cash value of the property was immaterial. 65 The Saskatchewan case of C.P.R. v. Town of Breedenbury r e  s u l t e d i n a somewhat s i m i l a r d e c i s i o n under the p r o v i s i o n s of an e a r l i e r D Z _1950/ 2 W.W.R. 337 Headnote. 6 3 . T f . P o i n t e r v. Norwich A.C. fl92l] 2 K.B. 471. 64 - - _1924/ 3 D.L.R. 31. 6 5 /192_7 3 W.W.R. 960. 96. 66 Town A c t which r e q u i r e d assessments which were a f a i r and j u s t p r o p o r t i o n to other assessments not to be v a r i e d on appeal unless there 67 was a s u b s t a n t i a l departure from f a i r a c t u a l value. The i m p l i c i t r e  quirement of u n i f o r m i t y had already been acknowledged at that time w i t h 68 regard to business assessments. 69 I n Rosborough v. C i t y of Regina, the L o c a l Government Board decided that the dominant f a c t o r was the requirement of as s e s s i n g to f a i r value and not the p r o v i s i o n s that prevented the a l t e r a t i o n on ap p e a l of an assessment that was " f a i r and j u s t " w i t h r e l a t i o n to other assessments. The p r o v i s i o n "the dominant f a c t o r i n the assessment of subjects of t a x a t i o n s h a l l be eq u i t y " was h e l d not to a l t e r the s i t u a  t i o n since i t r e l a t e d to the v a r i o u s c l a s s e s of property subject to tax and not s p e c i f i c premises. I f each premises must be assessed at f a i r value the p r o v i s i o n r e l a t i n g to e q u i t y w i l l r e f e r to e q u i t y at c o r r e c t assessment and w i l l t h e r e f o r e be a r e i t e r a t i o n and w i l l be reduidant. To provide f o r e q u i t y of assessment as between d i f f e r e n t c l a s s e s w i l l i n d i c a t e the b e l i e f that f a i r value may have d i f f e r e n t i n t e r p r e t a t i o n s f o r d i f f e r e n t c l a s s e s b b R.S.S. 1920. c 87. s. 392 (now repealed). 6 7 See a l s o Rogers R e a l t y Co. v. S w i f t Current J1918J 2 W.W.R. 214. 68 Weyburn Hardware and F u r n i t u r e Co. v. C i t y of Weyburn and  McKinnons L t d . /1919/ 2 W.W.R. 42. 6 9 /19347 2 W.W.R. 636. 97. of property and that the assessors are to u t i l i z e the d i s c r e t i o n they have so as to achieve e q u i t y . I n e f f e c t there should be no c o n f l i c t between the c o r r e c t assessments and u n i f o r m i t y (equity) since i n the d i s c r e t i o n given to the assessor i s the a b i l i t y to f i x the b a s i s of assessment f o r p a r t i c u l a r c l a s s e s of property. The existence of an assessment that i s not " f a i r and j u s t " w i t h another w i l l i n d i c a t e an i n c o r r e c t assessment. Which i s i n c o r r e c t can only be determined by examining other assessments. To accept one as i n c o r r e c t because i t i s not i n accord w i t h f a i r value w i l l be to presume that f a i r value i s determinate and consequently to deny that the assessors have been given the d i s c r e t i o n to f i x the b a s i s of assessment. On the other hand, i f t h i s d i s c r e t i o n i s denied, to make the p r o v i s i o n r e l a t i n g to e q u i t y meaningful i t must be assumed that i t gives the a u t h o r i t y to enter 'tone of the l i s t assessments' onto an i n c o r r e c t r o l l . I n A l b e r t a , d i f f e r i n g importance has been attached to c o r r e c t - 70 ness and u n i f o r m i t y . I n G r i e r s o n v. Edmonton i t was determined that although under a s t a t u t e the assessments of adjacent premises may be important i n determining the r e l e v a n t assessment such comparisons "can not be r e s o r t e d to as the proper t e s t or standard where there has been i n the assessment a gross over v a l u a t i o n i n f a c t of p a r t i c u l a r lands be- 71 yond t h e i r ' f a i r a c t u a l v a l u e ' ". Thus such assessments are only con- '0 __1917/ 2 W.W.R. 1138, concerning the Charter of the C i t y of Edmonton. 7 1 I b i d . , Davies J . at p. 1140. 98. sidered on the assumption that they represent f a i r a c t u a l value and not to achieve u n i f o r m i t y . 72 However i n Re Withycombe E s t a t e , a case concerned w i t h v a l u a t i o n f o r Succession Duty purposes, Ewing J.A. s a i d of r e a l property assessments While the m u n i c i p a l i t y i s bound to assess a t the f a i r market value t h i s p r o v i s i o n i s subject to another p r o v i s i o n v i z : that the assessment i s uniform w i t h that of s i m i l a r l y s i t u  ated p r o p e r t i e s . Thus the m u n i c i p a l i t y i s , i n the r e s u l t ,  compelled only to see that the assessments are uniform . . . . i t i s , I t h i n k , n o t o r i o u s that the assessment o f t e n bears l i t t l e r e l a t i o n to the "value" of the property. 3 I t would appear that he considered that the requirement of u n i f o r m i t y predominated over the requirement of co r r e c t n e s s , and that t h i s was the p o l i c y being implemented. I n Manitoba, as evidenced by the Courts' d e c i s i o n s concerning the C i t y of Winnipeg, there were a l s o c o n f l i c t i n g j u d i c i a l p r o v i s i o n s concerning u n i f o r m i t y and cor r e c t n e s s . 74 I n 1934 i n Re P h i l l i p s E s t a t e the argument f o r u n i f o r m i t y of assessment and f o r the c o n s i d e r a t i o n of the assessments of other proper t i e s was r e j e c t e d on the ground that no p r o v i s i o n f o r u n i f o r m i t y or e q u a l i t y e x i s t e d i n the Winnipeg Charter. I n 1940 however, the Court 72 A944/1 W.W.R. 385; 2 D.L.R. 189; /T94572D.L.R. 283. 73 /T9447 1 W.W.R. 385, 397, (Underlining-added). 7 4 /J9347 1 W.W.R. 449, 457-9. 99. of Appeal d e c l i n e d to reduce an assessment as no d i s c r i m i n a t i o n had been shown, s t a t i n g I t must be shown that t h i s property i s bearing more than i t s proper share of the present taxes before r e l i e f can be g i  ven by a Court of A p p e a l . 7 ^ The f o l l o w i n g year, a f t e r the Winnipeg Charter was amended by the i n c l u s i o n of a s e c t i o n p e r m i t t i n g Appeal Courts to consider other 76 assessments, the Chief J u s t i c e of the Kings Bench extended and q u a l i  f i e d the a p p l i c a t i o n of the p r i n c i p l e of u n i f o r m i t y s t a t i n g i n T. Eaton  v. Winnipeg Where there i s doubt or d i f f i c u l t y i n a s c e r t a i n i n g what the v a l u a t i o n should be on any one property the,fundamental p r i n  c i p l e of e q u a l i t y of t a x a t i o n between a l l ' r a t e p a y e r s i n the m u n i c i p a l i t y i s the properiguide and i f that c o n d i t i o n i s a r r i v e d at no i n j u s t i c e i s done to anyone. 7 7 The e f f e c t of the s e c t i o n p e r m i t t i n g the c o n s i d e r a t i o n of other assessments was subsequently described by Mr. J u s t i c e Major I take i t t h i s s e c t i o n means th a t , on a l l such appeals the p r i n c i p l e f o r the Board and the Courts to f o l l o w i s that assessments of r e a l t y s h a l l bear a f a i r and j u s t r e l a t i o n to assessments of other property of the same c l a s s i n the v i c i n  i t y . 7 8 The width of t h i s i n t e r p r e t a t i o n and of the d e c i s i o n s i n the T. Eaton and McCarthy cases exceeds those r e l a t i n g to a s i m i l a r enactment i n Ontario. ^ Dennistoun J.A. i n McCarthy v. C i t y of Winnipeg. /1940/ 1 D.L.R. 481, 483. 7 6 S e c t i o n 333 (enacted by 1940. c. 82, s. 8). I t was s i m i l a r to S. 86(2) of the Ontario Assessment A c t supra. 77 McPherson C.J.K.B. i n T. Eaton v. Winnipeg. Unreported — quoted i n Curry Investments L t d . v. Winnipeg /_194_/1 W.W.R. 17, at p. 25 ( U n d e r l i n i n g added). _ 7 8 Re the C i t y of Winnipeg and the T. Eaton R e a l t y Co. L t d . _19447 2 W.W.R. 541, 550. 7 9 Supra, pp. 92-93. 100. 80 I n Curry Investments L t d . v. C i t y of Winnipeg Mr. J u s t i c e Major considered Chief J u s t i c e McPherson's words i n T. Eaton v. Winnipeg but concluded, quoting an Ontario d e c i s i o n , I f i n d that the assessor was j u s t i f i e d i n r e f e r r i n g to the assessment of other lands f o r the purpose only to quote the then Mr. J u s t i c e Duff i n Dreyfus v. Royds case at p. 776 — "as a f f o r d i n g some evidence of the a c t u a l value but only f o r that purpose?" 8-^ The r e s u l t of t h i s d e c i s i o n was the same as that of Re P h i l l i p s E s t a t e ; other assessments were not to be introduced f o r the purpose of ac h i e v i n g u n i f o r m i t y of assessment. Instead o b j e c t i o n s were to be made against 82 the assessments of other p r o p e r t i e s . Conclusion I n both England and Canada the Courts have produced c o n f l i c t i n g d e c i s i o n s regarding the use to which other assessments may be put and regarding the r e l a t i v e importance of u n i f o r m i t y and corr e c t n e s s . I n England a dichotomy i s apparent i n the d e c i s i o n s of the High Court and those of the Lands T r i b u n a l . ' That such a d i s t i n c t i o n can e x i s t i s the r e s u l t of the p r o v i s i o n s which prevent appeals from being made against a r a t e to Quarter Sessions i n cases where r e l i e f can 83 be obtained by means of proposals to a l t e r i n d i v i d u a l assessments; o u _/1946/ 1 W.W.R. 17. 8 1 I b i d . , p. 22-23. 8 2 I b i d . , p. 24. 8 3 L o c a l Government A c t 1948, 11 and 12 Geo. 6. c. 26. s. 53 and R a t i n g and V a l u a t i o n (Miscellaneous P r o v i s i o n s ) A c t 1955 s. 15. . 101. the Court's i n s i s t e n c e on the proposal procedure, even where vast num- 84 bers of proposals are i n v o l v e d ; and the acceptance by the V a l u a t i o n O f f i c e r s of the p r i n c i p l e of u n i f o r m i t y as between assessments, and t h e i r f a i l u r e to appeal from the Lands T r i b u n a l to the Court of Appeal against t h i s dichotomy. I n Canada the va r i o u s l e g i s l a t i v e p r o v i s i o n s have r e s u l t e d i n d i f f e r i n g i n t e r p r e t a t i o n s of s i m i l a r p r o v i s i o n s i n d i f f e r e n t pro v i n c e s and i n the same province. W h i l s t i t i s apparent that u n i f o r m i t y at the b a s i s of assessment i s the o b j e c t i v e , i t cannot be stat e d that there i s a u t h o r i t y f o r u n i f o r m i t y to the detriment of correctness i n the absence of express s t a t u t o r y p r o v i s i o n s . The S t a t u t o r y p r o v i s i o n s themselves may place d i f f e r i n g empha ses on u n i f o r m i t y and c o r r e c t n e s s , but they may be d i f f e r e n t l y i n t e r  preted i n d i f f e r e n t c o u r t s ; and t h e i r e f f e c t may be unpredictable. Z **4 R ; V t Paddin'gton V.O. ex parte Peachey Property Corp. L t d . /1964/ 3 A l l E.R. 200 _1965/ 2 A l l E.R. 836. 102. CHAPTER VI THE MAINTENANCE OF ASSESSMENT ROLLS The c o n f l i c t between correctness and u n i f o r m i t y may e x i s t when an assessment r o l l , or a p o r t i o n of i t , i s not assessed i n accord ance w i t h the s t a t u t o r y requirements. The departure from those r e q u i r e  ments may be the r e s u l t of a f a i l u r e .to update the assessments on an ol d r o l l , the r e s u l t of i n c o r r e c t assessments ansa new r o l l , or the r e s u l t of both. The c o n f l i c t w i l l a r i s e when a new assessment has to be made, or a r e v i s i o n made of an e x i s t i n g one, and when the l e v e l of value adopted i n the r o l l d i f f e r s from that r e q u i r e d by law. The pro bable consequence of departure from the s t a t u t o r y requirements w i l l be the i n e q u a l i t y of treatment of taxpayers. Once there has been a departure from the l e g a l requirements there are, i n p r a c t i c e s e v e r a l courses of a c t i o n open to the assessor. These a l t e r n a t i v e s w i l l be examined so as to i n d i c a t e the d e s i r a b i l i t y of pursuing any one course of a c t i o n . The l e g a l i t y of t h e i r a c t i o n s w i l l not be considered since although compliance w i t h the s t a t u t o r y and j u d i c i a l p r o v i s i o n s i s of paramount importance -- and i t i s against t h i s that the a c t i o n s of the assessor must, i n p r a c t i c e be judged — departures from the s t a t u t o r y 103. p r o v i s i o n s are not uncommon and t h e i r consequences must be recognised i f any informed d e c i s i o n regarding the improvement of the property tax i s to be made. This d e c i s i o n does not l i e w i t h the i n d i v i d u a l assessor since h i s f u n c t i o n i s to assess i n accordance w i t h the l e g a l requirements, but l i e s w i t h the l e g i s l a t u r e or w i t h someone to whom the l e g i s l a t u r e has delegated t h a t a u t h o r i t y . The adoption of d i f f e r i n g p r a c t i c e s by the assessors can i t s e l f r e s u l t i n i n d i v i d u a l taxpayers bearing an i n  c o r r e c t burden of the tax. I n e v a l u a t i n g the q u a l i t y of an assessment r o l l i t should be recognised that the adoption of the r e a l property tax i s on the grounds 1 of expediency and p r a c t i c a l c o n s i d e r a t i o n s , and consequently that com p l i a n c e w i t h the requirements of the l e g i s l a t o r s i s the only c r i t e r i o n by which i t s e f f i c a c y can be judged. We have seen that a l t e r n a t i v e bases of assessment can be s p e c i f i e d by the l e g i s l a t u r e and upon that choice w i l l depend the d i s t r i b u t i o n of the burden of the tax. The assessment r o l l can t h e r e f o r e be judged by i t s success i n d i s t r i b u  t i n g the burden of the tax i n the manner re q u i r e d by the l e g i s l a t u r e . I t i s t h i s c r i t e r i o n which w i l l be adopted as a measure of the q u a l i t y of the assessment r o l l . Q u a l i t y w i l l t h e r e f o r e be a f u n c t i o n of equal i t y of treatment. I t i s the nature of the r e a l property tax that i f a l l proper t i e s are subject to the same r a t e of tax ( m i l l r a t e ) , the f r a c t i o n of 1 Supra, p. 22. 104. the t o t a l tax borne by each taxpayer i s equal to that p o r t i o n of the t o t a l of the assessment r o l l t hat i s represented by h i s assessment. By comparing the d i s t r i b u t i o n of the burden imposed by any one assess ment r o l l w i t h the d i s t r i b u t i o n of the burden imposed by a c o r r e c t r o l l , 2 some measure of the q u a l i t y of the r o l l can be obtained. The usefulness of t h i s c r i t e r i o n i s l i m i t e d i n p r a c t i c e by the d i f f i c u l t y of e s t a b l i s h i n g the c o r r e c t assessment f o r a l l p r o p e r t i e s on the r o l l and the r e s u l t a n t d i f f i c u l t y i n e v a l u a t i n g the q u a l i t y of 3 d i f f e r e n t assessment r o l l s . Between r e v a l u a t i o n s there are, i n general, two c l a s s e s of a c t i o n open to the assessors. The c o r r e c t i o n or amendment of the e x i s t  i n g assessments so as to r e v i s e the r e l a t i o n s h i p s of the tax burdens borne by i n d i v i d u a l s and c l a s s e s of taxpayers, and the i n t r o d u c t i o n of new assessments as a consequence of p h y s i c a l change i n the property l i a b l e to tax. As the assessor has the choice whether to r e v i s e the e x i s t i n g assessments, so he has a choice regarding, the l e v e l of value to be adopted f o r new assessments. Although these can be independent, complementary p r a c t i c e s w i l l be re q u i r e d i f e q u a l i t y of treatment i s to r e s u l t . 2 See Appendix B. 3 Whether the measures of assessment q u a l i t y mentioned i n Appendix B could be used to estimate the q u a l i t y of an assessment r o l l from a sample i s beyond the scope of t h i s d i s s e r t a t i o n . I t has been assumed that the e n t i r e r o l l i s a v a i l a b l e f o r e v a l u a t i o n . See Ghert o p . - e i t . and James Schwinden "Real P r o p e r t y Assessment P o l i c y and Prac t i c e i n Minnesota" (Unpublished Ph.D. D i s s e r t a t i o n , Dept. of A g r i c u l  t u r e , U n i v e r s i t y of Minnesota ) 1961. 105. The former w i l l only be open to an assessor where the p e r i o d between r e v a l u a t i o n s i s s u f f i c i e n t l y long f o r changes i n the l e v e l of value s p e c i f i e d by law, to have occurred. Where there have been no such changes, the r o l l w i l l , i n general, be as e q u i t a b l e as when i n t r o  duced and no a l t e r a t i o n s should be necessary. This w i l l occur whenever r e v a l u a t i o n s are made s u f f i c i e n t l y f r e q u e n t l y , or whenever the law spe c i f i e s a s t a t i c l e v e l of values (such as h i s t o r i c circumstances and h i s t o r i c v a l u e s , or an unaltered scheme of values i n an assessment manual). Where a new r o l l i s introduced each year, as i n B r i t i s h C o l  umbia, c o r r e c t i o n s w i l l be made when the new r o l l i s introduced. A t that time a l l p r o p e r t i e s should be reassessed a i d the r o l l should be c o r r e c t . Any departures from correctness (other than those r e s u l t i n g from the i n a b i l i t y to adopt cu r r e n t values) w i l l be the consequence of e r r o r s by i n d i v i d u a l assessors. Examples of p o s s i b l e e r r o r s by the assessors are the adoption of an i n c o r r e c t b a s i s of assessment and the i n a b i l i t y to achieve an adequate l e v e l of assessment q u a l i t y . Where the r o l l i s i n c o r r e c t and the general l e v e l of value i n any, p a r t i c u l a r c l a s s i s not the same as that r e q u i r e d , the choice of l e v e l of value to be adopted f o r new assessments w i l l remain, though there w i l l be no r e v i s i o n of. the r o l l between r e v a l u a t i o n s . 106. I t w i l l be necessary to c o n t r a s t u n i f o r m i t y and e q u a l i t y of 4 treatment, s i n c e the former, as d e f i n e d , says nothing of the r e l a t i o n  ship that i s to e x i s t between the assessments of d i f f e r e n t c l a s s e s of property nor of the r e l a t i o n s h i p between p r o p e r t i e s of the same c l a s s which are valued by d i f f e r i n g techniques, such as r e n t a l evidence and 5 a p r o f i t s b a s i s ,or market evidence and r e s i d u a l v a l u a t i o n methods. U n i f o r m i t y w i l l not, of i t s e l f , produce e q u a l i t y of treatment. Equal- 6 i t y i s dependent on the s p e c i f i e d b a s i s of assessment and i t w i l l r e  quire assessments to be at a constant percentage of the c o r r e c t assess ment. U n i f o r m i t y however r e q u i r e s c o n s i s t e n t a s s e s s i n g to a b a s i s of assessment that need not be the c o r r e c t one. I t w i l l t h e r e f o r e be necessary to d i s t i n g u i s h between p r a c t i c e s which r e s u l t i n u n i f o r m i t y alone and those that r e s u l t i n e q u a l i t y of treatment. A) Unaltered Assessment R o l l s . On the grounds of s i m p l i c i t y and expediency, or i n the ab sence of a u t h o r i t y to the c o n t r a r y , the assessors may leave unaltered the body of the assessment r o l l between p e r i o d i c r e v a l u a t i o n s only mak in g amendments on the i n t r o d u c t i o n of new premises and the a l t e r a t i o n of e x i s t i n g ones. General changes i n value over the years would be i g - 7 nored. This p r a c t i c e i s not uncommon i n England and Wales. 4 Supra. Chapter 1, p. 23 Great B r i t a i n Parliamentary Debates (Commons) op. c i t . , DCIII (1959) 1171, Mr. H. Brook; and a l s o DCCXXIX (1966) 1264, Mr. Crossman. 6 Supra, Chapter 1. v 7 Supra, p.65 and see a l s o , The Royal I n s t i t u t i o n of Chartered Surveyors' "Report on R a t i n g " (London: The I n s t i t u t i o n , 1966) para. 52, reported i n R a t i n g and V a l u a t i o n Reporter VT ( A p r i l 1966) p. 280. 10.7. Over the l i f e of such an assessment r o l l the c o r r e c t values of the p r o p e r t i e s on i t may increase or decrease. The changes may take p l a c e at d i f f e r e n t r a t e s and i n r e l a t i o n to each other the changes i n value may be s u b s t a n t i a l . The more s u b s t a n t i a l are the changes the poorer w i l l be the q u a l i t y of the assessment r o l l s ince the burden im posed on i n d i v i d u a l taxpayers w i l l vary to a greater extent from that imposed by a c o r r e c t r o l l . When a new or a l t e r e d b u i l d i n g f a l l s to be assessed the asses sor i s re q u i r e d to assess i t i n accordance w i t h the s t a t u t o r y b a s i s of assessment. Such an assessment would not n e c e s s a r i l y improve the qual i t y of the assessment r o l l . The t o t a l e f f e c t on the q u a l i t y of the r o l l w i l l be made up of two p a r t s , the c o r r e c t i o n of the r e l e v a n t assess ment and the r e s u l t i n g s h i f t i n the tax burden between that property and theccthers on the r o l l . I f one assessment i s increased both the t o t a l of a l l assessments and the burden c a r r i e d by the property concerned, w i l l i n c r e a s e . Consequently the amount of tax l e v i e d from a l l other p r o p e r t i e s on the r o l l w i l l be reduced i n p r o p o r t i o n to the s i z e of t h e i r assessment. I t i s u n c e r t a i n whether the net r e s u l t of these two f o r c e s w i l l be an increase or decrease i n the q u a l i t y of the assess ment r o l l . T his can be seen from the f o l l o w i n g h y p o t h e t i c a l example. I n a s i t u a t i o n where each assessment i s h a l f the c o r r e c t f i g - 8 ure the d i s t r i b u t i o n of the burden w i l l be c o r r e c t . However i f one ° i . e . Each assessment on the r o l l i s only h a l f the f i g u r e that should have been entered. I t i s not the same_;situation as that r e q u i r e d i n B r i t i s h Columbia whereby assessed value i s h a l f 'actual v a l u e . ' I n such a case the c o r r e c t assessment would be h a l f 'actual v a l u e 1 . 108. assessment departs from that f r a c t i o n , i n e q u a l i t y w i l l r e s u l t . Thus i n Table I I I a h y p o t h e t i c a l r o l l i s presumed where f i v e of the s i x p r o p e r t i e s are assessed at h a l f the c o r r e c t f i g u r e , the s i x t h ( E ) i s assessed at s e v e n t y - f i v e percent of the c o r r e c t f i g u r e . Columns ( i i ) and ( i v ) i n d i c a t e the c o r r e c t and a c t u a l burdens of t a x a t i o n borne by each property, taken to four places of decimals. The i n e q u a l i t y r e  s u l t i n g from the s i x t h assessment appears i n columns (v) and ( v i ) , the l a t t e r showing the d e v i a t i o n as a f r a c t i o n of the c o r r e c t assess ment. The s i m i l a r i t y of the f i g u r e s f o r p r o p e r t i e s A, B, C, D, E i n  d i c a t e s that the r e d u c t i o n i n the burden r e s u l t i n g from F's overassess- ment has been apportioned between the other p r o p e r t i e s i n p r o p o r t i o n to the s i z e of t h e i r assessments. Columns ( v i i ) , ( v i i i ) , ( i x ) and (x) i n d i c a t e the r e s u l t s of c o r r e c t i n g assessment F. Although i n both cases p r o p e r t i e s A, B, C, D, and E are a f f e c t e d i n the same manner and by the same p r o p o r t i o n as each other, the r e s u l t of the c o r r e c t i o n has been to s h i f t the burden of t a x a t i o n between them and property F. By the measures mentioned i n Appendix B, the e f f e c t of cor- 9 r e c t i n g assessment F has been a decrease i n the. q u a l i t y of the r o l l . y According to the measure J_7|xi~yi| / y__/, the r o l l has de t e r i o r a t e d , s i n c e i t s value has increased from 0.9375 to 1.6666. Sim i l a r l y i f the measure £ ]_ ( x i - y i ) 2 /y_L/ i s employed. The f i r s t r o l l has a value of 0.0391 w h i l s t the second has a value of 0.1234. TABLE III THE EFFECT OF CORRECTING A SINGLE ASSESSMENT ON A HYPOTHETICAL ROLL Correct Roll Actual Roll Corrected Roll M cu cu o u fl CU B W CU 00 to <! c _ CQ fl cu CO CU co co <! •H fl cu S-l d l x i - y i | | ( i v ) - ( i i ) | . x i - y H y i M ( i i ) 4J fl cu CO cu w CQ fl cu S-l 3 PP |Xi-yi| | ( v i i i ) - ( i i ) j I X i - y i l y i (ix) ( i i ) (i) ( i i ) ( i i i ) (iv) (v) (vi) (vii ) ( v i i i ) (ix) (x) $.000 4 8 12 16 20 24 ,0476 ,0952 .1429 ,1905 ,2381 ,2857 $.000 2 4 6 8 10 18 .0417 .0833 .1250 .1667 .2083 .3750 ..0059 .0119 .0179 .0238 .0298' .0893 1250 ,1250 ,1250 ,1250 1250 ,3125 $.000 2 4 6 8 10 24 .0370 .0741 .1111 .1481 .1851 .4444 .0106 .0212* .0317* .0423* .0529* .1587 .2222 .2222 .2222 .2222 .2222 .5556 84 1.0000 48 1.0000 ,1786 54 ,9998 .3174 * Apparent error caused by rounding. 110. A s i t u a t i o n can be imagined however, i n which the c o r r e c t i o n of one assessment reduces the discrepancy between the a c t u a l burden c a r r i e d and the c o r r e c t burden and r e s u l t s i n an improvement i n the 10 q u a l i t y of the r o l l . One problem to be solved by an assessor who wishes to i n t r o  duce i n t o the r o l l assessments that are uniform w i t h e x i s t i n g assess ments w i l l be whether to consider changes i n circumstances o c c u r r i n g since the i n t r o d u c t i o n of comparable assessments. Examples of such changes are inc r e a s e s or decreases i n the p o p u l a r i t y of a neighbourhood or c l a s s of accommodation; improvement i n the amenities of a d i s t r i c t e t c . To consider those changes, w h i l s t adopting the l e v e l s of value i n 11 the assessment r o l l w i l l r e s u l t i n i n d i s c r i m i n a t e gains and l o s s e s where the changes are not considered i n the e x i s t i n g assessments. There w i l l then be two, or more, bases of assessment i n e f f e c t . The f i r s t , the o r i g i n a l b a s i s of assessment, h i s t o r i c circumstances and h i s t o r i c v a l u e s , w i l l apply to un a l t e r e d assessments, w h i l s t the sec ond, cu r r e n t circumstances and h i s t o r i c values w i l l apply to new and r e v i s e d assessments. The r o l l w i l l t h e r e f o r e not be uniform. I f the assessor wishes to reduce the s i z e of those i n d i s  c r i m i n a t e gains and lo s s e s and produce u n i f o r m i t y he can e i t h e r r e v i s e 10 i t should be noted that we are here concerned w i t h r e p l a c  i n g the a c t u a l assessment w i t h the c o r r e c t one. I t should be contrasted w i t h the p o l i c y of i n t r o d u c i n g the assessment at a f i g u r e at which the burden of tax borne i s the same as under a c o r r e c t r o l l . 1 1 The s i t u a t i o n r e q u i r e d by the tone of the l i s t p r o v i s i o n s of the L o c a l Government A c t 1966 c. 42. S. 17. See Appendix A. 111. the assessment r o l l to the extent that a l l those premises a f f e c t e d by the changed circumstances are revalued to accord w i t h the new assess ment, or he could assume the c o n d i t i o n s that e x i s t e d when the l i s t was made when assessing the new or a l t e r e d property. I n the former case e q u a l i t y of treatment might e x i s t w i t h i n the c l a s s e s of property that were reassessed since i f a l l changed circumstances were considered, the i n d i v i d u a l p r o p e r t i e s might be c a r r y i n g the same f r a c t i o n of the tax burden borne by that c l a s s of property as under a c o r r e c t r o l l , even i f assessed at a d i f f e r e n t l e v e l of value. However i t i s u n l i k e l y that e q u a l i t y of treatment would a l s o p r e v a i l as between d i f f e r e n t c l a s s e s of p r o p e r t y ; s i n c e r e v i s i o n s would only occur when a new assessment had to be made. For c e r t a i n c l a s s e s of property no new assessments might be needed and consequently no r e v i s i o n would take p l a c e . For other c l a s s e s the r e v i s i o n s may occur at d i f f e r e n t times and conse quently d i f f e r e n t circumstances would be presumed. Therefore although u n i f o r m i t y would e x i s t w i t h i n each c l a s s , d i f f e r e n t bases of assess ment would be i n e x i s t e n c e ; and so, the r e l a t i o n s h i p s between c l a s s e s 12 of property would not represent the c o r r e c t r e l a t i o n s h i p s . Consequently i t cannot be assumed that the p r o p e r t i e s w i t h i n the reassessed c l a s s would be bearing the same burden of tax as under a c o r r e c t l i s t s ince that would only occur where the c l a s s of property ( i n t o t a l ) was bearing the same percentage of the t o t a l tax burden as •*-2 i . e . Those e x i s t i n g i n a c o r r e c t assessment r o l l . 112. under a c o r r e c t v a l u a t i o n l i s t . This s i t u a t i o n would be f o r t u i t o u s where i n c o r r e c t r e l a t i o n s h i p s e x i s t between c l a s s e s of property. To the assessor who wishes to achieve e q u a l i t y of treatment on the i n t r o d u c t i o n of new assessments there are two a l t e r n a t i v e s . F i r s t l y he can subject the assessment r o l l to the t e s t s mentioned i n the Appendix-B and from them, by t r i a l and e r r o r determine the assess ment which w i l l y i e l d the best d i s t r i b u t i o n of the burden of the tax throughout the r o l l . However, to run the t e s t s he would r e q u i r e the knowledge of the c o r r e c t assessments, and given t h i s i n f o r m a t i o n the c o r r e c t i o n of the r o l l must be presumed. A l t e r n a t i v e l y he may assess each new premises at the same percentage of the c o r r e c t assessment as t h a t at which the e x i s t i n g pre mises are assessed. Where a l l assessments on the r o l l are at the same p r o p o r t i o n of the c o r r e c t assessment, e q u a l i t y w i l l r e s u l t . Where t h i s i s not the case, the adoption of the average percentage (the t o t a l of the a c t u a l r o l l , times one hundred, d i v i d e d by the t o t a l of the c o r r e c t r o l l ) w i l l r e s u l t i n the new property bearing the c o r r e c t burden of 13 the t o t a l tax. I t may be t h a t by adopting a s p e c i f i c percentage of the cor r e c t assessment the assessor can achieve e q u a l i t y w i t h i n the c l a s s of 13 i f we m u l t i p l y a l l assessments i n the r o l l by the r e c i p r o c a l of that percentage, both the t o t a l of the r o l l and the assessment of the new property w i l l be at t h e i r c o r r e c t l e v e l s . 113. property to which the new assessment belongs; or at l e a s t the bearing by the new property of the c o r r e c t p o r t i o n of the tax borne by the c l a s s . However i t w i l l only bear the c o r r e c t burden of the t o t a l tax when the t o t a l of the c l a s s bears the c o r r e c t r e l a t i o n s h i p to the t o t a l of the r o l l . I n p r a c t i c e the c a l c u l a t i o n of the average percentage of the c o r r e c t assessments adopted throughout the r o l l or merely w i t h i n one c l a s s w i l l be severely hampered by the requirement of the knowledge of c o r r e c t assessments. Given t h i s knowledge the c o r r e c t i o n of the r o l l must again be presumed. I n adopting l e v e l s of value f o r new assessments the assessor i s not r e s t r i c t e d to attempting to achieve e q u a l i t y or u n i f o r m i t y but can use other l e v e l s of value. I n view of the c o n f l i c t between the requirement of correctness and that of u n i f o r m i t y he may enter new as sessments a t a l e v e l of value between t h a t used i n th e ; : r o l l and the c o r r e c t l e v e l of value. Such a p r a c t i c e w i l l prevent the o b j e c t i o n s which might be made by other taxpayers against a new assessment made on the same b a s i s as t h e i r own when they consider the newer property to be more v a l u a b l e ; w h i l s t r e l i a n c e on the s t a t u t o r y and j u d i c i a l p r o v i s i o n s may defeat an o b j e c t i o n by the owner of the revalued property based on the ground that he ought to be assessed at the same l e v e l as the e x i s t i n g assess ments. Since i t i s p o s s i b l e f o r a c o r r e c t i o n of a uniform assessment 11.4. to reduce the q u a l i t y of the r o l l , the adoption of an intermediate l e v e l f o r a new assessment can improve or reduce the q u a l i t y of the r o l l . B) P r o Rata Increases i n Assessment. To a l l o w f o r changes since the i n t r o d u c t i o n of the r o l l the 14 assessors may make percentage increases to a l l assessments on the r o l l . Where changes other than changes i n the value of money have occurred, so that r e l a t i v e values have a l t e r e d , there w i l l be i n e q u a l i t y of t r e a t  ment . I f only the value of money has a l t e r e d the r o l l w i l l not, p r i o r to c o r r e c t i o n , be l e s s e q u i t a b l e than when i t was created since the burden on each property w i l l not have a l t e r e d . Consequently the uniform increase of assessments w i l l c o r r e c t each assessment but w i l l not improve the q u a l i t y of the r o l l . I f d u r i n g the l i f e of the r o l l , the values of p r o p e r t i e s have a l t e r e d r e l a t i v e to each other, the r o l l w i l l be of l e s s than p e r f e c t q u a l i t y . The uniform increase of each assessment w i l l then leave un- 15 a l t e r e d the burden borne by each property, and consequently w i l l make no d i f f e r e n c e to the q u a l i t y of the r o l l . The same c o n s i d e r a t i o n s 1 4 E.G. Norwich R a t i n g A u t h o r i t y v. Norwich A.C. /_941_7 2 K.B. 326 and see the Report of the Royal Commission on Finance and M u n i c i p a l  Taxation i n New Brunswick, op. c i t . , p. 229. 15 See Appendix D. 115. could t h e r e f o r e apply to such a r o l l as were a p p l i c a b l e to an una l t e r e d r o l l . C) Revised Assessment R o l l s . I n a d d i t i o n to l e a v i n g the body of the r o l l u naltered between r e v a l u a t i o n s and i n c r e a s i n g the assessments by a uniform amount the assessor can endeavour to o b t a i n e q u a l i t y of treatment by r e v i s i n g the assessment r o l l . Where the r e v i s i o n transforms the r o l l i n t o a c o r r e c t one, e q u a l i t y w i l l r e s u l t and w i l l continue u n t i l there i s a r e l a t i v e change i n values as between p r o p e r t i e s on the r o l l . The assessor may attempt to achieve e q u a l i t y of treatment by r e v i s i n g assessments to al l o w f o r changes i n circumstances but w i t h reference to the o r i g i n a l l e v e l of values. E q u a l i t y of treatment w i l l then e x i s t when a l l assessments are a constant percentage of the cor r e c t f i g u r e . This w i l l occur when a l l the changes i n va l u e , other than uniform s h i f t s of a l l value f i g u r e s r e s u l t i n g from a change i n the value of money, are due to the changed circumstances considered by the asses sor. I n a l l other cases the r o l l would f a i l to a l t e r over time i n e x a c t l y the same way as the c o r r e c t r o l l would change and i n e q u a l i t y 16 w i l l be the consequence. 16 The a c t u a l amount of the movements i s not here important but r a t h e r t h e i r d i r e c t i o n and s i z e r e l a t i v e to the o r i g i n a l assessment. 116. Where changes i n circumstances a f f e c t i n g the property of a p a r t i c u l a r c l a s s are recognised and adequate a l t e r a t i o n s made, e q u a l i t y of treatment w i t h i n that c l a s s w i l l e x i s t , b u t the p r o p e r t i e s w i l l only c a r r y t h e i r c o r r e c t burdens where the t o t a l of the assessments i n the c l a s s bears the c o r r e c t r e l a t i o n s h i p to the t o t a l of a l l assessments on the r o l l . I f the p r o p e r t i e s w i t h i n a c l a s s do not bear the c o r r e c t r e l a t i o n s h i p to each other and i f the t o t a l of assessments i n that c l a s s does not bear the c o r r e c t r e l a t i o n s h i p to the t o t a l of a l l the assess ments, the bearing of the c o r r e c t burden by any of the p r o p e r t i e s i n that c l a s s w i l l be f o r t u i t o u s . I t i s considered that the achievement of e q u a l i t y of t r e a t  ment w i t h i n a c l a s s or property i s more lik e l y . : t h a n the achievement of e q u a l i t y between c l a s s e s , p a r t i c u l a r l y where the assessments are not made w i t h reference to cur r e n t market values. On appeal, comparisons 17 between assessments w i l l be r e s t r i c t e d to p r o p e r t i e s of the same c l a s s and t h i s w i l l emphasise the achievement of e q u a l i t y w i t h i n c l a s s e s i n c o n t r a s t to e q u a l i t y between c l a s s e s . I n r e v i s i n g the assessment r o l l to a l l o w f o r changes i n c i r  cumstances the assessor w i l l be confronted by a number of t e s t s of h i s judgement and these and t h e i r s e v e r i t y ought to be recognised before such a course of a c t i o n i s adopted. 17 Re Appeals of S h e l l O i l Co. of Canada L t d . and Standard O i l Co. of B.C. (1962) 38. W.W.R. 695; 33 D.L.R. (2d) 443.; Markham and  Markham v. Blake. (V.O.) and Hendon Corp. (1953) 46. R. and I.T. 203, H a l l i f a x v. Jackson. (1953) 46 R. and I.T. 214. 117.. D) Problems Connected w i t h the R e v i s i o n of An Assessment R o l l . 1) Timing Given the d e c i s i o n to make a l t e r a t i o n s to the assessment r o l l , the assessor must determine when to r e v i s e e x i s t i n g assessments. Since the aim i s to achieve e q u a l i t y , the assessment r o l l should be r e v i s e d whenever i t becomes l e s s than p e r f e c t . For t h i s purpose, where the s t a  t u t o r y b a s i s of assessment i s r e l a t e d to current circumstances, changes i n values must be i d e n t i f i e d , since a departure of the assessments from the s p e c i f i e d b a s i s of assessment w i l l r e s u l t i n i n e q u a l i t y x w i t h i n the r o l l . I n a dynamic economy circumstances a f f e c t i n g property values w i l l be c o n s t a n t l y changing and c r i t e r i a can be e s t a b l i s h e d i n order to determine when r e v i s i o n i s necessary. P e r i o d i c r e v a l u a t i o n s are f e a s i b l e , and d i f f e r e n t periods of time between r e v a l u a t i o n s have been considered appropriate i n d i f f e r - 18 ent j u r i s d i c t i o n s . The optimal p e r i o d w i l l depend on the speed at which values change, and i t s consistency. I t should a l s o , i n p r a c t i c e , be weighed- against the minimum q u a l i t y p e r m i s s i b l e and the f a c i l i t i e s a v a i l a b l e f o r r e v i s i o n . G e n e r a l l y , the f a s t e r values change r e l a t i v e 18 Report of the Royal Commission on Finance and M u n i c i p a l  Taxation i n New Brunswick, op. c i t . , p. 229; Report of the Royal Com mis s i o n on Taxation (Regina: Government of the Province of Saskatchewan, 1965) para. 6:36; Report of the Manitoba Royal Commission on.Local  Government Or g a n i s a t i o n and Finance. (Winnipeg: The Queen's P r i n t e r , 1964), pp. 121-122. 11*. to each other, the shorter should be the p e r i o d between r e v a l u a t i o n s i f a c e r t a i n q u a l i t y i s to be maintained i n the r o l l . The lower the per m i s s i b l e q u a l i t y the longer can be the p e r i o d , but i f a h i g h q u a l i t y i s r e q u i r e d a short p e r i o d between r e v a l u a t i o n s may be necessary i f changes i n values are l i k e l y to be spasmodic and severe. The minimum q u a l i t y r e q u i r e d , l i k e the establishment of the tax base and b a s i s of assessment, depends on p o l i t i c a l c o n s i d e r a t i o n s . G e n e r a l l y , the greater the number of r e v a l u a t i o n s the l a r g e r need be the assessing machinery and consequently the greater i t s cost. T h i s cost must be weighed against the q u a l i t y r e q u i r e d and the balance must be determined by the e x e r c i s e of a value judgement. I t should be noted that r e v a l u a t i o n r e q u i r e s the c o n s i d e r a t i o n of the value of a l l p r o p e r t i e s on the r o l l , even i f i t i s decided that there has been no change i n va l u e . The r e i n t r o d u c t i o n of an o l d r o l l without such c o n s i d e r a t i o n w i l l not c o n s t i t u t e a r e v a l u a t i o n but r a t h e r the prolonging of an e x i s t i n g r o l l . R e v i s i o n s of the r o l l may be made when a t t e n t i o n i s drawn to d i s c r e p a n c i e s and changes i n values by taxpayers who wish to object to p a r t i c u l a r assessments. Such a p r a c t i c e , except where appropriate to s i n g l e assessments, i s u n s a t i s f a c t o r y . I t leaves w i t h the taxpayers the duty of ensuring that changes i n values do not go u n r e f l e c t e d i n the r o l l . Since taxpayers are u n l i k e l y to object to t h e i r own assessments when they are too low; since by so ddng they w i l l increase t h e i r own tax b i l l ; i t w i l l be l e f t to them to p r o t e s t t h e i r own overassessment 119. and others' underassessment. The l a t t e r i s hardly l i k e l y to promote good ne i g h b o u r l i n e s s and i t i s considered (and t h i s i s a value judge ment) undesirable i n e x i s t i n g Western S o c i e t i e s . I t i s p o s s i b l e that taxpayers o b j e c t i n g against other assessmentsswill f i n d t h e i r appeal defeated and t h e i r own assessment r a i s e d . Where t h i s i s so the w i l l i n g  ness to appeal a g a i n s t other assessments w i l l disappear and o b j e c t i o n s w i l l be l i m i t e d to cases of overassessment of the obj e c t o r ' s premises, thereby p e r m i t t i n g the r o l l to d e t e r i o r i a t e . Under our d e f i n i t i o n s u n i f o r m i t y i s concerned w i t h the r e l a  t i o n s h i p between assessments, s i n c e i t r e q u i r e s that the assessments are made w i t h reference to values current at a common date, and i m p l i  c i t l y , to a common b a s i s of assessment. The date and b a s i s of assess ment are not s p e c i f i e d however, and only the s i m i l a r treatment of com parable p r o p e r t i e s i s ' m a t e r i a l . E q u a l i t y i s however, concerned w i t h the r e l a t i o n s h i p between the e x i s t i n g assessments and the c o r r e c t assessments. To leave w i t h the taxpayers the duty of i n d i c a t i n g changes i n value may r e s u l t i n i n e q u a l i t y going uncorrected because s u p e r f i c i a l l y u n i f o r m i t y i s apparent. F u r t h e r , i n e q u a l i t y r e s u l t i n g from d i s c r i m i n a  t i o n between c l a s s e s of property i s l e s s l i k e l y to appear as a ground f o r an appeal than d i s c r i m i n a t i o n between p r o p e r t i e s of the same c l a s s . The c o r r e c t i o n of e x i s t i n g assessments may be l e f t to the p o i n t where i n e q u a l i t y i s apparent to the assessor. The success of t h i s prac t i c e w i l l , however, depend on the q u a l i t y of the assessment machinery 120. s i n c e , without a r e g u l a r check on the q u a l i t y of the r o l l d i s c r e p a n c i e s may not be apparent u n t i l severe i n e q u a l i t y has r e s u l t e d . Where market value i s the b a s i s of assessment, market t r a n s a c t i o n s w i l l provide a check on the assessments. Some c l a s s e s of property r a r e l y change hands on the market, however, and f o r these p e r i o d i c r e v a l u a t i o n s w i l l be necessary. Where some other b a s i s of assessment i s adopted, the assess ments can only be checked by p e r i o d i c or o c c a s i o n a l r e v a l u a t i o n s . 2) Extent of R e v i s i o n Once the need f o r r e v i s i o n has been as c e r t a i n e d the extent of the r e v i s i o n must be determined. I t w i l l be necessary to e s t a b l i s h the p r o p e r t i e s whose values have changed s u f f i c i e n t l y since the i n t r o  d u c t i o n of the r o l l to r e q u i r e r e v i s i o n . I f t h i s i s to be done c o r r e c t l y each property ought be revalued and the c o r r e c t and a c t u a l assessments compared. Such a course of a c t i o n would however be i m p r a c t i c a b l e since i t would mean, i n e f f e c t , a r e v a l u a t i o n of the e n t i r e r o l l . I n s t e ad, the assessor may e s t a b l i s h , p o s s i b l y through sampling techniques, those c l a s s e s of property which r e q u i r e reassessment. Where a c l a s s of property i s defined as those p r o p e r t i e s whose values are af f e c t e d by the same f o r c e s , each of the changed circumstances which r e  s u l t i n changes i n v a l u e s , w i l l a f f e c t the values of a l l p r o p e r t i e s i n the c l a s s . Consequently i f i t i s seen t h a t the value of one property i n a c l a s s has changed s i g n i f i c a n t l y i t must be apparent that there has been a change i n the f a c t o r s a f f e c t i n g the value of that and other p r o p e r t i e s i n the c l a s s . Whether the other p r o p e r t i e s have been a f f e c -121. ted s i g n i f i c a n t l y cannot be p r e d i c t e d since value r e s u l t s from the i n t e r  a c t i o n of many fo r c e s and t h e i r net e f f e c t may be d i f f e r e n t f o r d i f f e r  ent p r o p e r t i e s of a p a r t i c u l a r c l a s s . Thus the assessor should revalue a l l t h e . p r o p e r t i e s i n a c l a s s a f f e c t e d by changed circumstances. The d e l i n e a t i o n of the var ious c l a s s e s w i l l however, be a matter of judgement. R e s i d e n t i a l , i n  d u s t r i a l , and commercial property c l e a r l y occupy separate c l a s s e s but there w i l l be d i f f e r e n t c a t e g o r i e s of each. Separate markets ( a l b e i t interconnected) e x i s t , f o r example f o r house and apartment accommodation and consequently they form separate c l a s s e s . S i m i l a r l y s i n g l e f a m i l y suburban accommodation can p o s s i b l y be contrasted w i t h down-town accom modation. Even w i t h i n a s i n g l e area, p r o p e r t i e s of a s i m i l a r type may be subject to d i f f e r i n g competitive f o r c e s and t h e r e f o r e belong to d i f  f e r e n t c l a s s e s . M u n i c i p a l d w e l l i n g s whose a l l o c a t i o n i s at the w i l l of the m u n i c i p a l i t y may form a separate c l a s s to i d e n t i c a l p r i v a t e l y owned d w e l l i n g s i n the same area. I n p a r t i c u l a r cases a c l a s s may con s i s t of a s i n g l e property. The c l a s s i f i c a t i o n of p r o p e r t i e s w i l l depend on the assessor's understanding of the f o r c e s at work i n the market and on h i s a b i l i t y to e s t a b l i s h c l a s s e s of property that are e f f e c t e d by the same market f o r c e s . The e f f e c t of m i s c l a s s i f i c a t i o n may be the f a i l u r e to r e v i s e a number of i n c o r r e c t assessments because of t h e i r i n c l u s i o n i n a c l a s s which i s considered to be of adequate q u a l i t y ; and consequently the o b t a i n i n g of a l e s s e r q u a l i t y of r o l l than was d e s i r e d . 122. The simultaneous r e v i s i o n of a l l the assessments i n a c l a s s i s d e s i r a b l e as p a r t i a l r e v i s i o n w i l l provide an opportunity f o r tax payers to challenge the new assessments on the grounds of l a c k of u n i  f o r m i t y . I f they are s u c c e s s f u l the consequence w i l l be i n e q u a l i t y w h i l s t i f they are not,there w i l l be d i s s a t i s f a c t i o n w i t h the f a i r n e s s of the r o l l . The problem of c l a s s i f i c a t i o n w i l l a l s o a r i s e when the asses sor attempts to b r i n g new assessments onto the r o l l at the "tone of the l i s t " . The d e c i s i o n whether a c l a s s of property r e q u i r e s r e v i s i o n w i l l depend on the s i z e of the change i n values since the i n t r o d u c t i o n of the r o l l , and w i l l be considered i n the l i g h t of the p o l i t i c a l con s i d e r a t i o n s mentioned above. 3) Establishment of new assessments. Once the assessor has decided which p r o p e r t i e s r e q u i r e new 19 assessments he must determine the l e v e l of value to be adopted. Where the other p r o p e r t i e s are not assessed c o r r e c t l y , the adoption of c o r r e c t assessments may r e s u l t i n i n e q u a l i t y of treatment. The c l a s s of property being reassessed w i l l , i n t o t a l , bear the c o r r e c t burden of the tax when i t s t o t a l bears the c o r r e c t r e l a t i o n - 19 According to law t h i s problem should o f t e n not a r i s e since the assessor i s r e q u i r e d to adopt cu r r e n t values i n accordance w i t h the b a s i s of assessment. However, we are here concerned w i t h the p r a c t i c a l ? not l e g a l , c o n s i d e r a t i o n s . 1 2 3 . ship to the t o t a l of the r o l l . The burden of that p o r t i o n of the tax w i l l be c o r r e c t l y d i s t r i b u t e d when each assessment bears the c o r r e c t r e l a t i o n s h i p to the others i n the c l a s s . Hence each property i n the c l a s s w i l l bear the c o r r e c t burden of the tax when i t s assessment bears the c o r r e c t r e l a t i o n s h i p to the t o t a l of the r o l l . This w i l l occur when the property i s assessed a t the same percentage of the c o r r e c t assessment as the average percentage adopted throughout the r o l l . To enter the new assessments at t h e i r c o r r e c t f i g u r e s would only mean that t h e i r burdens were c o r r e c t where the sum of a l l e x i s t i n g assessments equals the sum of the appropriate assessments on a c o r r e c t r o l l , though t h i s may be achieved by the over assessment of some pro p e r t i e s and the under assessment of others. The e f f e c t on the q u a l i t y of the r o l l w i l l be dependent on the change i n the burdens borne by the reassessed p r o p e r t i e s and the t r a n s  ference of burden between them and the other p r o p e r t i e s on.';the r o l l . I t would appear that where the burdens borne by the reassessed p r o p e r t i e s l i e c l o s e r to the c o r r e c t burden than p r e v i o u s l y , the q u a l i t y of the r o l l w i l l be improved. This w i l l r e s u l t i n two ways. F i r s t l y the reassessed burdens l y i n g c l o s e r to the c o r r e c t burdens w i l l tend to improve the q u a l i t y of the r o l l . Secondly, where the reassessed c l a s s i s the l a r  ger p a r t ( i n d o l l a r value) of the r o l l , t h e i r improvement w i l l tend to improve the burdens of the r e s t of the r o l l , s ince the t o t a l burden must equal u n i t y , and the improvement of one h a l f must, on the average 124. tend to improve the other h a l f . However, where the c l a s s represents a small p a r t of the r o l l i t would seem that there i s a p o s s i b i l i t y of the s h i f t i n burden aggravating the i n e q u a l i t y of other assessments, and thereby reducing the q u a l i t y of the r o l l . I n f a c t , the e f f e c t of the s h i f t e d burden, apportioned amongst the other assessments, w i l l tend to be outweighed by the improvement i n the c o r r e c t c l a s s . E) B r i t i s h Columbia. G e n e r a l l y i n B r i t i s h Columbia, a new assessment r o l l must be 20 deposited every year and consequently there i s no opportunity or need to r e v i s e the r o l l between r e v a l u a t i o n s . However, where the r o l l i s of 21 an u n s a t i s f a c t o r y q u a l i t y a choice may e x i s t between the achievement of u n i f o r m i t y of assessment w i t h comparable p r o p e r t i e s of the same c l a s s , and the making of a c o r r e c t assessment. This w i l l occur whenever the l e v e l of v a l u e s , or the b a s i s of assessment adopted by the assessor, d i f f e r s from those s p e c i f i e d . Where the assessor has, i n general, adopted the c o r r e c t l e v e l of value but, as a r e s u l t of an imperfect a s s e s s i n g machine, i n d i v i d u a l assessments are i n c o r r e c t , the c o n f l i c t w i l l not e x i s t . I n t h i s case, u n i f o r m i t y (the a s s e s s i n g i n accordance 20 Assessment E q u a l i z a t i o n A c t R.S.B.C. 1960 c. 18. s. 38(1); M u n i c i p a l A c t R.S.B.C. 1960. c. 255 s. 343(1), _____ s. 365. 21 Moore, Guttman and White, op. c i t . , p. 142. 125. w i t h the general l e v e l of values throughout the r o l l , or the general l e v e l of value w i t h i n the c l a s s ) w i l l be the same as c o r r e c t n e s s . To i d e n t i f y t h i s s i t u a t i o n w i l l r e q u i r e the i d e n t i f i c a t i o n of the general l e v e l of values from a s e r i e s of inaccurate assessments. When a new assessment i s made c o r r e c t l y , the premises w i l l only be bearing the c o r r e c t burden of t a x a t i o n where the t o t a l of the assessments on the r o l l i s the same as the t o t a l of the c o r r e c t r o l l . Where the t o t a l s are not the same, the new property w i l l be bearing the c o r r e c t burden where the average percentage of the c o r r e c t assessment i s adopted. For school purposes (and i f so decided, f o r general r a t e pur poses), the assessor i s l i m i t e d to i n c r e a s i n g any assessment by a maxi mum of f i v e per-cent i n one year, except where p h y s i c a l a l t e r a t i o n s have 22 taken p l a c e . This p r o v i s i o n may r e s u l t i n a r b i t r a r y b e n e f i t s and l o s s e s f o r c e r t a i n taxpayers. Property values can change (both upward and down ward) by more than 5% i n any one year and t h i s p r o v i s i o n w i l l b e n e f i t those whose property had increased i n value by more than 5%, w h i l s t i t w i l l not l i m i t the saving experienced by those whose p r o p e r t i e s have de creased i n value by a s i m i l a r percentage. Furthermore, i t w i l l b e n e f i t the owner of e x i s t i n g premises, but not the owner of new premises. Thus i f a house increased i n value by ten per-cent i n one year as a r e s u l t 22 Assessment E q u a l i z a t i o n A c t R.S.B.C. 1960. c. 18 s. 37A. (enacted by 1966 c. 45 s. 3.), and see, M u n i c i p a l A c t R.S.B.C. 1960. c. 255 s. 339(2). Another exception i s where the Assessment Commissioner has ordered a r e v a l u a t i o n . 126 . of a s h i f t i n demand, and i f during the year an i d e n t i c a l house were b u i l t nearby, the l a t t e r should be assessed at h a l f i t s " a c t u a l v a l u e " w h i l s t the former should be about f i v e per-cent below that f i g u r e . Where a p a r t i c u l a r c l a s s of landowner r e c e i v e s such favourable t r e a t  ment the appropriate burden i s borne by a l l other r e a l property-taxpayers. These p r o v i s i o n s form p a r t of the b a s i s of assessment and as such must be followed by the assessors. However, i t i s p o s s i b l e that some asse s s o r s , r e c o g n i s i n g the anomolies i n v o l v e d , may endeavour to l i m i t a l l assessment increases (and p o s s i b l y decreases,) to a s i m i l a r percentage and to assess a l l new premises at the same l e v e l of value as e x i s t i n g premises. Such a course of a c t i o n would r e s u l t i n tone of the l i s t assessments, and would introduce the c o n f l i c t between u n i  f o r m i t y and c o r r e c t n e s s . I n t h i s case, correctness would be the entry of new premises, and those whose value had d e c l i n e d , at t h e i r " a c t u a l v a l u e " (assessed value being one h a l f " a c t u a l v a l u e " ) , w h i l s t u n i f o r m i t y would be the l i m i t i n g of the f i g u r e s to those appropriate to e x i s t i n g premises and to 95% of the previous assessment, r e s p e c t i v e l y . The f a c t o r s considered e a r l i e r would then be appropriate to t h i s c o n f l i c t between u n i f o r m i t y and c o r r e c t n e s s . Summary I n t h i s Chapter we have examined the p r a c t i c a l d i f f i c u l t i e s and a l t e r n a t i v e s f a c i n g an assessor whose assessment r o l l departs from the j u d i c i a l and s t a t u t o r y requirements. G e n e r a l l y , two questions a r i s e ; 127. how to assess new and a l t e r e d premises? and whether to amend the assess ments between f u l l s c a l e r e v a l u a t i o n s , i n order to a d j u s t f o r changes i n value? They were discussed i n that order. I t was shown that some i n d i c a t i o n of the q u a l i t y of an assess ment r o l l can be obtained by examing the d i s t r i b u t i o n of the tax bur- 23 den under the a c t u a l and c o r r e c t r o l l s . P o s s i b l e measures were i n d i  cated though t h e i r usefulness under a l l s i t u a t i o n s was not i n v e s t i g a t e d . They r e q u i r e d the knowledge of the c o r r e c t assessments and consequently have only l i m i t e d a p p l i c a t i o n , p a r t i c u l a r l y as t h e i r v a l i d i t y w i t h regard to sampling techniques and estimations was not e s t a b l i s h e d . I n examining the question regarding the i n t r o d u c t i o n of new assessments, three p r a c t i c e s concerning the amendment of assessment r o l l s were considered. They were the maintenance of the o r i g i n a l r o l l w i t h  out a l t e r a t i o n ; i t s percentage increase and i t s r e v i s i o n to ad j u s t f o r changes i n v a l u e s . I t was w i t h regard to the l a s t that the problems inherent i n the maintenance of assessment r o l l s were discussed. These were p a r t i c u l a r l y , the t i m i n g of any adjustments, the extent of the a l t e r a t i o n s to be made and the establishment of the l e v e l of value to be adopted i n order to produce e q u a l i t y of treatment. 24 I t can be seen that e q u a l i t y and u n i f o r m i t y are d i f f e r e n t and 2 3 See Appendix B. 2 4 According to our d e f i n i t i o n s . Q . v . 128. i t was shown that the i n t r o d u c t i o n of a c o r r e c t assessment i n t o a r o l l can i n c e r t a i n circumstances, reduce i t s e q u a l i t y . Under other c i r  cumstances i t may improve the q u a l i t y of the r o l l . I n view of the i n a b i l i t y to f o r e c a s t a c c u r a t e l y the e f f e c t of any p a r t i c u l a r course of a c t i o n , no d e f i n i t e conclusions could be drawn but i t was noted that (1) the choice between the four measures w i l l be based on a value judgement; (2) p o l i t i c a l c o n s i d e r a t i o n s are i n v o l v e d i n the assessors' d e c i s i o n s regarding the q u a l i t y of r o l l to be main t a i n e d ; (3) the a l t e r a t i o n of e x i s t i n g assessments so as to b r i n g the burden borne by those p r o p e r t i e s c l o s e r to the c o r r e c t burden i s l i k e l y to improve the q u a l i t y of the assessment r o l l . 129. CHAPTER V I I CONCLUSIONS The problems connected w i t h the use of 'tone of the l i s t ' as sessments as encountered i n the United Kingdom between 1950 and 1956 can s t i l l e x i s t both there and i n Canada. Wherever the general l e v e l s of values i n the assessment r o l l d i f f e r from those r e q u i r e d by law e i t h e r as the r e s u l t of an inadequate d e f i n i t i o n of the b a s i s of assessment, or as the r e s u l t of an inadequate assessing machine, the assessor, when making new assessments may be faced w i t h a choice between achie v i n g correctness or u n i f o r m i t y . Wherever the l e v e l of value r e q u i r e d by law to be adopted, changes between r e v a l u a t i o n s , he may a l s o have a choice concerning the maintenance of the r o l l between r e v a l u a t i o n s . C l e a r l y the assessor i s r e q u i r e d to assess a l l p r o p e r t i e s i n accordance w i t h the l e g a l p r o v i s i o n s . However, where the s t a t u t o r y and j u d i c i a l p r o v i s i o n s c o n f l i c t , or where the b a s i s of assessment i s inadequately d e f i n e d , so that i t cannot be unequivocally e s t a b l i s h e d , the i d e n t i f i c a t i o n of the c o r r e c t assessment w i l l be d i f f i c u l t . I t s i d e n t i f i c a t i o n i s a l e g a l problem and should not be l e f t to the asses sors since they are not equipped to r e s o l v e a c o n f l i c t between d i f f e r i n g l e g a l p r o v i s i o n s . The assessors, who must implement those p r o v i s i o n s however, may be req u i r e d to i d e n t i f y and e x p l a i n the c o n f l i c t s . U n t i l 130. the c o n f l i c t s are r e s o l v e d the assessors w i l l be forced to i n t e r p r e t the p r o v i s i o n s i n order to produce new assessments. T h e i r i n t e r p r e t a  t i o n s should however be c o n s i s t e n t as between assessors, and between d i f f e r e n t c l a s s e s of p r o p e r t y , i f the confidence of the taxpayers i n the f a i r n e s s of the r o l l i s to be maintained. I f , when the c o n f l i c t i s r e s o l v e d and the b a s i s of assess ment e s t a b l i s h e d , there i s a d i f f e r e n c e between the c o r r e c t b a s i s of assessment and that p r e v i o u s l y adopted by the assessor, then the choice between correctness and u n i f o r m i t y w i l l a r i s e . u n t i l a new r o l l i s i n  troduced. I n some cases, where u n i f o r m i t y of assessment i s p a r t of the 1 b a s i s of assessment no c o n f l i c t w i l l e x i s t since there u n i f o r m i t y and correctness are synonymous. However i n other cases the p r o v i s i o n s r e  l a t i n g to u n i f o r m i t y w i l l be supplementary to the l e g a l b a s i s of assess ment, and i t i s there that a c o n f l i c t may a r i s e . As i n the s i t u a t i o n where there are d i f f e r i n g p r o v i s i o n s r e l a t i n g to the b a s i s of assess ment, the c o n f l i c t must be r e s o l v e d by the j u d i c i a r y w i t h the a i d of assessors and r e a l e s t a t e experts. As we have seen there are both s t a t u t o r y and j u d i c i a l a u t h o r i  t i e s f o r u n i f o r m i t y of assessment. The former may be i n t e r p r e t e d d i f  f e r e n t l y i n d i f f e r e n t j u r i s d i c t i o n s and even w i t h i n a s i n g l e j u r i s d i c t i o n 1 See f o r example, Assessment A c t R.S.N.S. 1954 c. 15. s. 18. r u l e 2 ( r e c a s t 1966 c.3. s.38.). 131. the courts may place d i f f e r i n g i n t e r p r e t a t i o n s on the r e l a t i v e importance of u n i f o r m i t y and c o r r e c t n e s s . The use of the r e a l property tax i s dependent on p r a c t i c a l c o n s i d e r a t i o n s and hence no fundamental p r i n c i p l e of t a x a t i o n can be c a l l e d i n a i d to determine which should predominate. Instead we are r e s t r i c t e d to c o n s i d e r a t i o n of the i n t e n t i o n s of the l e g i s l a t u r e , as expressed by s t a t u t e , and to t h e i r j u d i c i a l i n t e r p r e t a t i o n . No u n i  v e r s a l s o l u t i o n i s f e a s i b l e as i n each j u r i s d i c t i o n the b a s i s of assess ment may be d i f f e r e n t ; the q u a l i t y of i t s d e f i n i t i o n may d i f f e r ; and the l e g a l p r o v i s i o n s r e l a t i n g to uniform assessments may vary. Fur thermore the cur r e n t j u d i c i a l a u t h o r i t i e s on the r e l a t i v e importance of cor r e c t n e s s and u n i f o r m i t y i n d i f f e r e n t j u r i s d i c t i o n s may c o n t r a d i c t one another. I n a d d i t i o n , the p r i n c i p l e s and p r a c t i c e s adopted i n each area w i l l have been a f f e c t e d by the e a r l i e r p r o v i s i o n s . These may d i f  f e r as between d i f f e r e n t j u r i s d i c t i o n s and may i n time have been repealed. Since no u n i v e r s a l s o l u t i o n i s f e a s i b l e the c o n f l i c t between u n i f o r m i t y and correctness must be separately r e s o l v e d i n each j u r i s d i c  t i o n . I n a d d i t i o n to u n i f o r m i t y and c o r r e c t n e s s , e q u a l i t y of t r e a t  ment should be considered when assessi n g on a r o l l on which the l e v e l s of value d i f f e r from those r e q u i r e d by law. We have seen that e q u a l i t y of treatment i s the o b j e c t i v e f o r which the assessor should s t r i v e ; but that under c e r t a i n c o n d i t i o n s the c o r r e c t assessment of new pre-132. mises may reduce the q u a l i t y of the r o l l . Under other circumstances i t may improve the q u a l i t y of the r o l l . Only where a l l premises are c o r r e c t l y assessed w i l l c o r r e c t n e s s , u n i f o r m i t y and e q u a l i t y be syn onymous. I f a l l assessments are a constant percentage of the c o r r e c t f i g u r e correctness w i l l d i f f e r from u n i f o r m i t y and e q u a l i t y . We have seen that the concept of e q u a l i t y of treatment pro vides us w i t h c r i t e r i a by which to compare the q u a l i t y of d i f f e r e n t assessment r o l l s . I t a l s o provides us w i t h a p o l i c y that can be employed f o r i n t r o d u c t i o n of new assessments onto the r o l l . C l e a r l y a l l taxpayers should be tr e a t e d i n the same way and the taxpayer whose premises are a l t e r e d or who appeals a g a i n s t h i s assessment should not be p e n a l i s e d . He w i l l be t r e a t e d c o r r e c t l y i f the tax burden he bears i s the same as that which he would have borne i f a l l p r o p e r t i e s were c o r r e c t l y assessed. This s i t u a t i o n w i l l r e  s u l t where h i s assessment i s at the same percentage of the c o r r e c t assessment as the average percentage adopted f o r a l l assessments on 2 the r o l l . A t the same time the q u a l i t y of the r o l l g e n e r a l l y w i l l tend to be improved. A l t e r n a t i v e l y , the new assessment may be at the average per centage adopted f o r assessments of p r o p e r t i e s of the same c l a s s as . 133. 3 that being introduced, i n which case l e s s e q u a l i t y of treatment i s l i k e l y to r e s u l t than i f the o v e r a l l percentage i s adopted. The implementation of such a course of a c t i o n i s dependent on the knowledge of the t o t a l of the c o r r e c t assessments of a l l proper t i e s on the r o l l . T h is i s u n l i k e l y ; but i t may be p o s s i b l e to estimate t h i s f i g u r e by means of sampling techniques. L e g a l l y , - t h i s p o l i c y has l i t t l e to recommend i t . The new assessment would be n e i t h e r c o r r e c t nor uniform; as the l a t t e r was un- 4 derstood i n the Lands T r i b u n a l , and would be open to a t t a c k on both grounds. I t i s l i k e l y t hat the use of the average percentage a p p r o p r i  ate f o r that c l a s s of property alone would r e s u l t i n an assessment w i t h a greater appearance of u n i f o r m i t y than would the use of the o v e r a l l average percentage, s i n c e the c o n s i d e r a t i o n of the percentage of the c o r r e c t assessment adopted f o r other c l a s s e s would b r i n g the new assess ment away from the l e v e l of va l u e s adopted i n the appropriate c l a s s . Although the new assessment may i n some cases give the appearance of u n i f o r m i t y , the method by which i t was obtained may not be acceptable to the Courts. Whether the expression " f a i r and j u s t r e l a t i o n to the value a t which other land and improvements are assessed Supra, pp. 113-114. 4 See a l s o Pearce v. C i t y of New Westminster. (1958) Stated  Cases, op. c i t . , p. 49. 5 Assessment E q u a l i z a t i o n A c t R.S.B.C. 19 6 0 c . 18. s. 46(1). (as amended by 1961 c.3 s.6). 134. would be a p p l i c a b l e to such ari assessment must be argued before the Courts, but i t may permit the admission of such assessments. We consequently have a s i t u a t i o n whereby the assessor when ente r i n g a new or a l t e r e d property on the r o l l can i n some cases, s e l e c t 6 one of three assessments f o r each property. Two can g e n e r a l l y be defended w i t h some v a l i d i t y before the Courts w h i l s t the t h i r d , having no l e g a l a u t h o r i t y , creates the s i t u a t i o n r e q u i r e d by the law. The exis t e n c e of such a choice i s the r e s u l t of the adoption of l e v e l s of valu e s d i f f e r e n t from those r e q u i r e d by the l e g a l p r o v i s i o n s . I t i s an i n d i c a t i o n of the i n a b i l i t y to administer the r e a l property tax sat i s f a c t o r i l y . I t i s a fundamental p r i n c i p l e of t a x a t i o n that the tax l i - 7 a b i l i t y be c e r t a i n and not be at the d i s c r e t i o n of the tax gatherer. The e x i s t e n c e of the choices open to the assessor i n d i c a t e s that t h i s canon of t a x a t i o n i s not being obeyed. I t may be that the b a s i s of assessment s p e c i f i e d cannot be s a t i s f a c t o r i l y implemented because of the d i f f i c u l t y of e s t a b l i s h i n g the re q u i r e d f i g u r e s of v a l u e , or b Even i n B r i t i s h Columbia, where there i s l i t t l e evidence of the general use of an i n c o r r e c t b a s i s of assessment, the c o n f l i c t be tween u n i f o r m i t y and correctness can a r i s e from i n c o r r e c t assessing techniques. The tendency to overassess l e s s v a l u a b l e property r e l a t i v e to the more v a l u a b l e , may, at both ends of the scal e of va l u e , r e s u l t i n a d i s t i n c t i o n between uniform and c o r r e c t assessments. Adam Smith, op. c i t . , p. 778. 135. because of the work i n v o l v e d compared w i t h the f a c i l i t i e s a v a i l a b l e . However, the tax i s adopted because of p r a c t i c a l c o n s i d e r a t i o n s and the b a s i s of assessment i s s e l e c t e d to produce the r e q u i r e d d i s t r i b u t i o n of the tax burden. I f the b a s i s of assessment s p e c i f i e d i s d i f f i c u l t to a s c e r t a i n (or by i t s nature i s open to a wide margin of e r r o r when estimated); or i f the b a s i s of assessment r e q u i r e s a l a r g e assessing ma chine to maintain up to date assessments; then these p r a c t i c a l consider a t i o n s must be weighed against those which make the r e a l property tax d e s i r a b l e . Adam Smith's f o u r t h canon of t a x a t i o n , regarding the cost of tax c o l l e c t i o n must be kept i n mind. 8 Where a s p e c i f i e d d i s t r i b u t i o n of the tax burden i s r e q u i r e d , and where that cannot be s a t i s f a c t o r i l y achieved by the r e a l property tax except at great expense, a l t e r n a t i v e sources of revenue must be considered. Where a cheap, l o c a l tax i s r e q u i r e d but a s p e c i f i e d d i s t r i  b u t i o n of the burden i s not e s s e n t i a l , a more s a t i s f a c t o r y course of a c t i o n might be the adoption of a b a s i s of assessment that i s r e l a t i v e l y easy to e s t a b l i s h and maintain. I n e i t h e r case the d e c i s i o n w i l l be dependent on p o l i t i c a l c o n s i d e r a t i o n s . The same f a c t o r s should then determine the r e l a t i o n s h i p between the q u a l i t y of the r o l l s and the cost of assessments once t h a t d e c i s i o n has been made. a i . e . Formal incidence of the tax. As mentioned e a r l i e r , the e f f e c t i v e incidence i s indeterminate. 1 3 6 . I f the assessor's departure from the l e g a l requirements i s the r e s u l t of an ambiguous d e f i n i t i o n of the b a s i s of assessment or c o n f l i c t i n g s t a t u t o r y or j u d i c i a l p r o v i s i o n s , the s o l u t i o n l i e s w i t h the l e g i s l a t u r e . I f however i t i s the f a u l t of the assessment machine, the s o l u t i o n i s i n the hands of the A d m i n i s t r a t i o n . I n each case the taxpayers' e l e c t e d r e p r e s e n t a t i v e s may be r e q u i r e d to draw the con f l i c t s to the a t t e n t i o n of the L e g i s l a t u r e or A d m i n i s t r a t i o n . F u r t h e r Study I n t h i s paper, which has been concerned w i t h the problems i n  herent i n the assessor's departure from the l e g a l p r o v i s i o n s and i n p a r t i c u l a r the c o n f l i c t between correctness and u n i f o r m i t y , c e r t a i n pro blems have become apparent which, w h i l s t beyond the scope of t h i s study, are worthy of a t t e n t i o n . Where the assessor has departed from the l e g a l requirements, the departure w i l l be apparent. However, the i d e n t i f i c a t i o n of the b a s i s of assessment he has adopted w i l l not be so apparent, p a r t i c u l a r l y as some e r r o r i n a s s e s s i n g can be a n t i c i p a t e d . E i t h e r the b a s i s of assess ment, or the "tone" of the l i s t on i t s own, must be e s t a b l i s h e d i f tone of the l i s t or uniform assessments are to be introduced and v e r i f i e d by the taxpayer. The problem i s the need to i d e n t i f y those assessments which a c c u r a t e l y r e f l e c t the l e v e l of value adopted i n the r o l l , coupled w i t h the d e s i r e to express that l e v e l of value i n a form which can be used f o r f u t u r e assessments. 137. I n d e a l i n g w i t h the c r i t e r i a by which the q u a l i t y of an assess ment r o l l can be judged only l i m i t e d c o n s i d e r a t i o n was p a i d to the r e l a  t i v e m e r its of the measures contained i n Appendix B. I t i s f e l t t h at a b e t t e r measure might be developed out of these, p a r t i c u l a r l y one that i s amenable to s t a t i s t i c a l techniques. Such a measure would be u s e f u l as i t might permit estimations of assessment r o l l q u a l i t y to be made from only a sample of the p r o p e r t i e s on the r o l l . 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Soberman, The Law and Business A d m i n i s t r a t i o n i n Canada. Toronto: P r e n t i c e - H a l l of Canada L t d . , 1965. Spray F. Digest of Ra t i n g V a l u a t i o n Case Law. London: R a t i n g and V a l u a t i o n A s s o a t i o n , 1965. Stamp, S i r J o s i a h . The Fundamental P r i n c i p l e s of Taxation. London: Macmillan and Co., 1921. Turvey, Ralph. The Economics of Real Property. London: George A l l e n and Unwin, 1957. Wendt, Paul F. Real E s t a t e A p p r a i s a l . New York: Henry H o l t and Co., 1956. B. MONOGRAPHS Cameron, M.A. The F i n a n c i n g of Education i n Ontario. B u l l e t i n No. 7 of the Department of E d u c a t i o n a l Research. Toronto: U n i v e r s i t y of Toronto P r e s s , 1936. 141. Cameron, M.A. P r o p e r t y Taxation and School Finance i n Canada. Toronto: Canada and Newfoundland Education A s s o c i a t i o n , 1945. F i n n i s , F.H. "Real Property Assessment i n Canada". Canadian Tax Pa p e r s , No. 30. Toronto: Canadian Tax Foundation. 1962. Guide f o r Assessment-Sales R a t i o Studies. A r e p o r t of the Committee on Sales R a t i o Data of the N a t i o n a l A s s o c i a t i o n of Tax A d m i n i s t r a  t o r s . Chicago: F e d e r a t i o n of Tax A d m i n i s t r a t o r s , 1954. H i c k s , J.R., U.K. Hicks and C.E..V. Leser. The Problem of V a l u a t i o n  f o r R a t i n g . N a t i o n a l I n s t i t u t e of Economic and S o c i a l Research. Occasional Paper No. 7. London: Cambridge U n i v e r s i t y P r e s s , 1944. Moore, A. M i l t o n , A r t h u r I . Guttman and P h i l i p H. White. F i n a n c i n g Education i n B r i t i s h Columbia. Vancouver: B r i t i s h Columbia School Trustees A s s o c i a t i o n , 1965. New Sources of L o c a l Revenue. A Report of a Study Group of the Royal I n s t i t u t e of P u b l i c A d m i n i s t r a t i o n . London: George A l l e n and Unwin L t d . , 1956. R a t c l i f f , R.U. A Restatement of A p p r a i s a l Theory. Wisconsin Commerce Reports. V o l . V I I No. 1. Madison, W i s e : The U n i v e r s i t y of Wisconsin, School of Commerce, 1963. Report on Japanese Taxation by the Shoup M i s s i o n . Tokyo: General Head quarters of the Supreme Commander f o r the A l l i e d Powers, 1949. 3 v o l s . "Report on R a t i n g " . London: The Royal I n s t i t u t i o n of Chartered Sur veyors, 1966. S t a t e and L o c a l Taxation of Property. New York: N a t i o n a l I n d u s t r i a l Conference Board, 1930. C. PERIODICALS The Chartered Surveyor. London: The Royal I n s t i t u t i o n of Chartered Surveyors. Passim. C l a r k , D.H., W.J. O l i v e r , C.H. Chappell and F.H. F i n n i s , "Uniform Assessments" 1958 Conference Report. Toronto: Canadian Tax Foundation, 1959, pp. 140-171. R a t i n g and Income Tax. London: S o l i c i t o r s Law S t a t i o n e r y S o c i e t y L t d . Passim. 142. R a t i n g and V a l u a t i o n Reporter. London: R a t i n g P u b l i s h e r s L t d . Passim. "Report of the Committee on State E q u a l i z a t i o n of L o c a l Property Tax Assessments", Proceedings of F i f t y - f i r s t Annual Conference. H a r r i s b u r g , Pa. N a t i o n a l Tax A s s o c i a t i o n , 1959, pp. 315-357. Spengler, E.H. "The'Property Tax as a B e n e f i t Tax" i n H.M. Groves (ed.) Viewpoints on P u b l i c Finance r e p r i n t e d from P r o p e r t y Taxes, New York: Tax I n s t i t u t e , 1940. White, P.H. "Concepts of Assessment Value" Report of the 1963 Confer  ence. Toronto: Canadian Tax Foundation, 1964. pp. 109-114. D. UNPUBLISHED MATERIAL Ghert, B.I. "Measures of the Q u a l i t y of Real P r o p e r t y Assessments: An examination of t h e i r v a l i d i t y " . Unpublished M.B.A. t h e s i s . The U n i v e r s i t y of B r i t i s h Columbia, Vancouver, 1965. Schwinden, James. "Real P r o p e r t y Assessment P o l i c y and P r a c t i c e i n Minnesota". Unpublished Ph.D. d i s s e r t a t i o n , Department of A g r i  c u l t u r e , U n i v e r s i t y of Minnesota, 1961. E. REPORTS OF ROYAL COMMISSIONS Report of the Manitoba Royal Commission on L o c a l Government O r g a n i s a t i o n  and Finance. Winnipeg: The Queen's P r i n t e r , 1964. Report of the Royal Commission on Finance and M u n i c i p a l Taxation i n New  Brunswick. F r e d e r i c t o n ; The Queen's P r i n t e r , 1963. Report of the Royal Commission on Taxation. 7 v o l s . Ottawa: The Queen's P r i n t e r , 1966. Report of the Royal Commission on Taxation. Quebec: Government of Quebec, 1965. Report of the Royal Commission on Taxation. Regina: Government of the Province of Saskatchewan. 1965. V i c q , Jack. L o c a l Government Finance. Research Study No. 1 f o r the (Saskatchewan) Royal Commission on Taxation. Regina: Royal Com mi s s i o n on Taxation.1965. 143. F. OTHER GOVERNMENT DOCUMENTS 1. Government of Canada. Canada Year Book 1966. Ottawa: Dominion Bureau of S t a t i s t i c s , 1966. N a t i o n a l Accounts: Income and Expenditure, 1965, (No. 13-201) Ottawa: Dominion Bureau of S t a t i s t i c s , 1965. 2. P r o v i n c i a l Governments. Government of t h e Province of A l b e r t a . Assessment Manual. F i r s t e d i t i o n . /Edmonton/ Department of M u n i c i p a l A f f a i r s , 1959. Province of B r i t i s h Columbia. A p p r a i s a l Manual Second e d i t i o n / V i c t o r i a : Government of Province of B.C_/ _. Stated Cases. V i c t o r i a , B.C.: O f f i c e of the Assessment Commissioner. L o c a l Government Continuing Committee. L o c a l Government Finances i n Saskatchewan. A T e c h n i c a l reference document to the re p o r t L o c a l  Government i n Saskatchewan, submitted to the Government of Saskat chewan March _ l s t , 1961. y_Regina: Government of the Province of Saskatchewan^/ Government of Onta r i o . Manual of Assessment Values. Second E d i t i o n . Toronto: Department of M u n i c i p a l A f f a i r s , 1954. 3. Great B r i t a i n . Annual A b s t r a c t of S t a t i s t i c s 1966 (No. 103) London: C e n t r a l S t a t i s t i c a l Office.:, Her Majesty's S t a t i o n e r y O f f i c e . L o c a l Government Finance: England and Wales. Cmnd. 2923. London: Her Majesty's S t a t i o n e r y O f f i c e , February 1966. Parliamentary Debates (Commons). F i f t h s e r i e s . London: Her Majesty's S t a t i o n e r y O f f i c e . Passim. Parliamentary Debates ( L o r d s ) . F i f t h S e r i e s . London: Her Majesty's S t a t i o n e r y O f f i c e . Passim. Report of the Committee on Housing i n Greater London. Cmnd 2605. London: Her Majesty's S t a t i o n e r y O f f i c e , March 1965. The V a l u a t i o n ( S t a t u t o r y ? Deductions) Order 1962. S.I. 1962 No. 940. London: Her Majesty's S t a t i o n e r y O f f i c e . G. STATUTES 1. Canadian Statutes of A l b e r t a . 1957 c. 61. The M u n i c i p a l i t i e s Assessment and E q u a l i z a t i o n A c t . 1958 c. 50. An amending A c t . 1960 c. 5. The Assessment A c t . 1963 c. 3. An amending A c t . B r i t i s h Columbia S t a t u t e s . 1914. c. 52. M u n i c i p a l A c t . 1921 c. 55. Vancouver I n c o r p o r a t i o n A c t . 1953 c. 55. Vancouver Charter. 1953 (2nd Sess.) c. 32. Assessment E q u a l i z a t i o n A c t . Revised S t a t u t e s of B r i t i s h Columbia. 1960 c. 18. Assessment E q u a l i z a t i o n A c t . c. 255. M u n i c i p a l A c t . c. 319. P u b l i c Schools A c t . c. 376. Taxation A c t . B r i t i s h Columbia S t a t u t e s . 1961 c. 3. Assessment E q u a l i z a t i o n A c t Amendment A c t . c. 61. Taxation A c t Amendment A c t . 1962 c. 82. Vancouver Charter Amendment A c t . 1964 c. 72. Vancouver Charter Amendment A c t . 1966 c. 45. S t a t u t e Law Amendment A c t . Statutues of Manitoba. 1940 c. 81. The Winnipeg Charter. c. 82. An Amending A c t . Revised S t a t u t e s of Onta r i o . 1950 c. 24. Assessment A c t . 1960 c. 23. Assessment A c t . Revised S t a t u t e s of Nova S c o t i a 1954 c. 15. Assessment A c t . Stat u t e s of Nova S c o t i a 1966 c. 3. An amending A c t . Revised S t a t u t e s of Saskatchewan. 1920 c. 87. Town A c t . 1965 c. 147. C i t y A c t . c. 148.Town A c t . c. 149. V i l l a g e A c t . c. 150. R u r a l M u n i c i p a l i t y A c t . 145. 2. Great B r i t a i n . S t a t u t e s a t Large. LXXVI: 6 and 7. W i l l . 4. c. 96. P a r o c h i a l Assessment A c t 1836. C I I : 25 and 26. V i c t . c. 103. Union Assessment Committee A c t 1862. CIV: 27 and 28. V i c t . c. 39. Union Assessment Committee Amendment  Ac t . 1864. Law Reports S t a t u t e s . IV: 32 and 33. V i c t . c. 67. V a l u a t i o n ( M e t r o p o l i s ) A c t 1869. 15 and 16. Geo. 5 c. 90. Ra t i n g and V a l u a t i o n A c t 1925. 26 Geo. 5 and 1 Edw. 8 c. 43. l i t h e A c t 1936. 11 and 12. Geo. 6. c. 26. L o c a l Government A c t 1948. 1 and 2. E l i z . 2. c. 42. V a l u a t i o n f o r R a t i n g A c t 1953. 4 E l i z . 2. c. 9. R a t i n g and V a l u a t i o n (Miscellaneous Pro v i s i o n s ) A c t 1955. 7 and 8 E l i z . 2. c. 36. R a t i n g and V a l u a t i o n A c t 1959. 9 and 10 E l i z . 2. c. 45. Ra t i n g and V a l u a t i o n A c t 1961. E l i z . 2. c. 75. Rent A c t 1965. Halsbury's Statutes (2nd ed.) I n t e r i m S e r v i c e . L o c a l Government A c t 1966 c. 42. -General Rate A c t 1967. c. 9. H. CASES 1. Canadian. A l k a l i Lake Ranch L t d . v. P r o v i n c i a l A s s e s sors, Quesnel Fo r k s , e t a l . (1964) (N.S.) 46 W.W.R. 528, 48 W.W.R. 120. Re A l l e n and Town of Miminco (1920)_19 O.W.N. 150. B e l l I r v i n g v. C i t y of Vancouver. /1924/ 3_D.L.R. 31. Butcher, et a l . v. C i t y of Vancouver./1950/ 1 W.W.R. 961; 1 D.L.R. 754. Canadian C o l l i e r i e s Resources L t d . v. Comox A.D. (1962) Stated Cases, op. c i t . , p. 140. . v. C i t y of P o r t Moody. (1961) Stated Cases op. c i t . , p. 106. _ _ Canadian N a t i o n a l Railways, e t a l . v. Vancouver C i t y . __1950/ 2 W.W.R. 337. Canadian P a c i f i c Railways v. Town of Breedenbury /_1922/ 3 W.W.R. 960. Re: Canadian P a c i f i c Railways and Assessor of P o r t Coquitlam. (1957) 77; C.R.T.C. 95. Canadian P a c i f i c Railways v. C i t y of Vancouver. (1965) 50 W.W.R. 302; 47 D.L.R. (2d) 157._ Chapman v. McLeod. _/1949/ O.W.N. 395. I n Re Charleson Assessment (1915) 21_B.C_R. 281. C h r i s t i e and C l a r k (Re Appeal of:) /1937/ 1 W.W.R. 81. Coddington v. D i s t r i c t M u n i c i p a l i t y of West Vancouver Stated Cases op. c i t . , p. 138. 146. Re Crown Z e l l e r b a c h Canada L t d . (1959) 16 D.L.R._(2d) 144. Curry Investments L t d . v. C i t y of Winnipeg /1946/ 1 W.W.R. 17. Re Desautel's Appeal (1959) 29 W.W.R. 665. Dixon ( I n Re M u n i c i p a l A c t and:) (1939-1940) 55 B.C.R. 546. Dreyfus v. Royds 71921/ 1 W.W.R. 769; 5 D.L.R. 41. Dugas v. Macfarlane. (1911) 18 W.L.R. 701. T. Eaton v. Winnipeg.(1941) Unreported. Evans Coleman and Evans and G i l l e y Bros. L t d . v. C i t y of P o r t Coquitlam (1957) Stated Cases op. c i t . , p._44._ Fran-Robert L t d . v. C i t y of Ottawa. y_L956/ O.W.N. 807. Gates' Case (Re: M u n i c i p a l A c t ) /__918/ 2 W.W.R__ 930. Glace Bay v. Seaboard Power Corporation L t d . /1952/ 2 D.L.R. 826. Gr i e r s o n v. C i t y of Edmonton. /_1917/2 W.W.R. 1138. Re: H a l i f a x F i r e Ass. Co. and C i t y of Toronto. (1939) 9 F.L.J. 106. Home Coal Co. L t d . v. Corporation of D e l t a (1960) Stated Cases op. c i t . , p. 80. Re Lefeaux (1963) 37 D.L.R. (2d) 235._ _ In Re: L i o n s Gate Assessment Appeal /1940/ 1 W.W.R. 624. McCarthy v. C i t y of Winnipeg. /1940/ 1 D.L.R. 481. Re: Manning Assessment /1942/ 1 D.L.R. 383. Mersey Paper Co. v. C i t y of Queens. (1959) 18 D.L.R. (2dj_ 19__ Montreal I s l a n d Power Co. v. Town of L a v a l des Rapides /1935/ S.C.R. 304. Nelson and F o r t Sheppard Railway Co. (Re: Assessment A c t and:) (1904) 10 B.C.R. 519. Pearce v. Calgary. (1915) 9 W.W.R. 668. Pearce v. C i t y of New Westminster. (1958) Stated Cases op. c i t . , p.49. P r o v i n c i a l Assessors of Comox, Cowichan and Nanaimo v. Crown Z e l l e r b a c h Canada L t d . and Crown Z e l l e r b a c h B u i l d i n g M a t e r i a l s L t d . (1963) 39 D.L.R. (2d) 381. _ Re: P h i l l i p s E s t a t e /1934/ 1 W.W.R. 449. R. v. P e n t i c t o n Sawmills (1954) 11 W_W.R__ (N.S.) 351. Rogers R e a l t y Co. v. S w i f t Current./1918/ 2 W.W.R. 214. Rosborough v. C i t y of Regina. _1934/ 2 W.W.R. 636. Rowan's Appeal (Re: Assessment E q u a l i z a t i o n A c t : ) (1962) 40 W.W.R. 627. Re: R o y a l i t e O i l Co. L t d . Assessment (1957) 11 D.L.R. (2d) 527. Re: Appeals of S h e l l O i l Co. of Canada L t d . and Standard O i l Co. of B.C. (1962) 38 W.W.R. 695; 33 D.L.R. (2d) 443. Stock Exchange B u i l d i n g Corporation L t d . v. C i t y of Vancouver. A945/ 2 W.W.R. 248. _ _ Sun L i f e Assurance Co. of Canada v. Montreal./1950/ 2 D.L.R 785; S.C.R. 220; _1952/ 2 D.L.R. 81. Tu r n b u l l Real E s t a t e Co. v. Sewell. J193V 2 D.L.R. 218. C i t y of Vancouver v. Township of Richmond (1958) Stated Cases, op. c i t . , p. 53; 17 D.L.R. (2d) 548. v. Schenley Holdings L t d . (1965) Stated Cases, op. e i t . , p. 249. '" v. Vine Lodge L t d . et a l . (1964) Stated Cases op. c i t . , p. 231. Bishop of V i c t o r i a v. V i c t o r i a . (1933) 3 W.W.R. 332. 147. Weyburn Hardware and F u r n i t u r e Co. v. C i t y of Weyburn and McKinnons L t d . A919/ 2 W.W.R. 42__ Winnipeg v. Cross. /_1926/ 2 W.W.R. 868. _ _ Re; the C i t y of Winnipeg and the T. Eaton R e a l t y Co. L t d . _/1944/ 2 W.W.R. 541. Re: Withycoro.be E s t a t e . A944/ 1 W.W.R. 385. 2. B r i t i s h . Lord Advocate v. E a r l of Home. (1891) 28 Sc. L.R. 289. B a r r a t t and R u s s e l l ' s Gravesend Brewery L t d . v. Gravesend Assessment Committee. A94_L/ 2 K.B. 107. B r i t i s h American Typewriters v. H i l l (V.O.). (1962) 2 R. and V.R. 374; 1962 R.A.298. Trustees of Archdiocese of C a r d i f f v. Pontypridd A.C. (1930)94 J.P. 246; 12 R. and l . T . 275, T.L.R. 633. Cartwright v. the Guardians of the Poor of the Sculcoates Union. A 8 9 9 / 1 Q.B. 667 A900/A.C. 150. Consett I r o n Co. L t d . v. A.C. f o r N.W. Area of County of Durham. /T931/ A.C. 396. Cotswold E l e c t r i c L t d . v. Howard (V.Q.). (1958) 51 R. and l . T . 125; 2. R.R.C. 363. Double v. Southampton Assessment Committee. [VillJ 2 K.B. 213. _ _ East London Railway J o i n t Committee v. Greenwich Union A.C. et a l . , __1913/ 1 K.B. 612. Gloucester County Borough C o u n c i l and Wessex Freeholds (Gloucester) L t d . v. T r e v a i l (V.O.) (1952) 45 R. and l . T . 422. Great E a s t e r n Railway Co. v. The Overseers of Haughley. (1866) L.R. 1 Q.B. 666. Great Western and M e t r o p o l i t a n Railway Companies and Kensington et a l . y_1916/ 1 A.C. 23. H a l l i f a x v. Jackson (V.O.) (1953) 46 R. and l . T . 214. Harrow Borough C o u n c i l v. B e t t s (V.O.) et a l . , (1960) 53 R. and l . T . 577. Hunter v. Swindon A.C. A922/ 2 K.B. 630. Jones v. Small (V.O.). (1957) 50 R. and l . T . 725; 2. R.R.C. 202. K i m b e l l s L t d . v. Payne (V.O.). (1954) 47 R. and l . T . 255. L a d i e s Hosiery and Underwear L t d . v. West Middlesex Assessment Committee. A932/ 2 K.B. 679. L i l l e y and Skinner L t d . v. Essex County V a l u a t i o n Committee. /1935/ A l l E.R. Rep. 54. 51 T.L.R. 432. London County Co u n c i l v. Churchwardens (Etc.) of E r i t h and West Ham. /1893/ A.C. 562. Lotus and Ddta L t d . v. Holman (V.O.). (1963) 3 R. and V.R. 296 1963 R.A. 113; Chartered Surveyor XCV: 648. Markham and Markham v. Blake (V.O.) and Hendon Corporation. (1953) 46 R. and l . T . 203. 148. Mason v. C e n t r a l Land Board. (1952) 3 P. and CR. 391; 46 R. and I.T. 314. M o r r i s e y v. Morley (V.O.). (1952) 45 R. and I.T. 282. Neath Sheet S t e e l and G a l v a n i s i n g Co. L t d . v. Neath Area Assessment Com mi t t e e . (1942) 36 R. and I.T. 50; 14 D.R.A. 65; 39 R. and I.T. 212. North and South Western J u n c t i o n Railway Co. v. Bre n t f o r d Union Assess ment Committee. (1888) 13 App. Cas. 592. • _ _ Norwich R a t i n g A u t h o r i t y v. Norwich Assessment Committee. A941/ 2 K.B. 326. P o i n t e r v. Norwich Assessment Committee. /1922/ 2 K.B. 47; 471. Poplar v. Roberts. A922/ 2 A.C. 93. ~ P o r t of London A u t h o r i t y v. Assessment Committee of Or s e t t Union e t . a l . , A920/ A.C. 273. R. v. Adams. (1832) 4 B. and Ad. 61; 110 E.R. 378. v. Cornwall County V a l u a t i o n Committee ex pa r t e . Falmouth R a t i n g A u t h o r i t y . _193_/ 2 K.B. 222. v. Mast. (1795). 6 T.R. 154; 101 E.R. 485. v. Paddington V a l u a t i o n O f f i c e r and another ex part e . Peachey Pro p e r t y Corporation L t d . A964/ 3 A l l E.R. 200 _1965/ 2 A l l E.R. 836. v. St. Luke's H o s p i t a l . (1760) 2 Burr. 1053; 97 E.R. 703. v. School Board f o r London. (1886) 17 Q.B.D. 738. v. S h e f f i e l d United G a s l i g h t Co. (1863) 4 B. and S. 135;122 E.R. 410; 32 L.J.M.C. 169. v. S k i n g l e (1798) 7 T.R. 549; 101 E.R. 1126. v. South S t a f f o r d s h i r e Waterworks Co. (1885) 16 Q.B.D. 359; 50 J.P. 20. v. West Middlesex Waterworks. (1859) 1 E. and E. 716; 120 E.R. 1078; 28 L.J.M.C. , 135. Railway Assessment A u t h o r i t y v. The Southern Railway Co. (1936) A.C. 266. W.A. Rawlinson and Co. L t d . v. P r i t c h a r d (V.O.). (1958) 52 R. and I.T. 182; 4 R.R.C. 178. Robinson Bros. (Brewers) L t d . v. Houghton and C h e s t e r - l e - S t r e e t Assess  ment Committee. ]193]_/ 2 K.B. 445. Shrewsbury Schools (Governors) v. Shrewsbury Borough C o u n c i l and Plumpton  (V.O.) 53 R. and I.T. 497; 176 E.G. 143. S t a l e y v. The Overseers of C a s t l e t o n . (1864) 5 B. and S. 505; 122 E.R. 920. S t i r k and Sons L t d . v. H a l i f a x A.C. A922/ 1 K.B. 264._ Stockbridge M i l l Co. L t d . v. C e n t r a l Land Board. 71954/ 2 A H E.R. 360. S t r i n g e r et a l . v. Wilson (V.O.). (1953) 46 R. and I.T. 431. _ _ Townley M i l l Co. (1919) L t d . v. Oldham Assessment Committee. /1937/ A.C. 419; 1 A l l E.R. 11. Winkler v. Cowie (V.O.) (1952) 45 R. and I.T. 504. A P P E N D I C E S 150. APPENDIX A LOCAL GOVERNMENT ACT 1966, c. 42 (Halsbury's S t a t u t e s (2nd E d n . ) — I n t e r i m Service) 17. V a l u a t i o n according to tone of l i s t . - - ( l ) For the purposes of any a l t e r a t i o n of a v a l u a t i o n l i s t to be made i n respect of a h e r e d i t a  ment i n pursuance of a proposal served on or made by the v a l u a t i o n o f f i c e r a f t e r the passing of t h i s A c t , the valu e or a l t e r e d value to be as c r i b e d to the hereditament s h a l l not exceed the value which would have been a s c r i b e d thereto i n that l i s t i f the hereditament had been sub s i s t i n g throughout the year before that i n which the v a l u a t i o n l i s t came i n t o f o r c e , on the assumptions that a t the time by reference to which that value would have been a s c e r t a i n e d -- (a) the hereditament was i n the same s t a t e as at the time of v a l  u a t i o n and any r e l e v a n t f a c t o r s (as defined by subsection (2) of t h i s s e c t i o n ) were those s u b s i s t i n g at the last-mentioned time; and (b) the l o c a l i t y i n which the hereditament i s s i t u a t e d was i n the same s t a t e , so f a r as concerns the other premises s i t u a t e d i n tha t l o c a l i t y and the occupation and use of those premises, the t r a n s p o r t s e r v i c e s and other f a c i l i t i e s a v a i l a b l e i n the l o c a l i t y , and other matters a f f e c t i n g the amenities of the l o c a l i t y , as at the time of v a l u a t i o n . (2) I n t h i s s e c t i o n -- "r e l e v a n t f a c t o r s " means any of the f o l l o w i n g , so f a r as mater i a l to the v a l u a t i o n of a hereditament, namely the mode or category of occupation of the hereditament, the quantity, of minerals or other substances i n or ex t r a c t e d from the h e r e d i  tament, or, i n the case of a p u b l i c house, the volume of trade or business c a r r i e d on at the hereditament; and " p u b l i c house" means a hereditament being or comprising pre mises l i c e n s e d f o r the s a l e of i n t o x i c a t i n g l i q u o r f o r consump t i o n on the premises where the s a l e of such l i q u o r i s , or i s apart from any other trade or business a n c i l l a r y or i n c i d e n t a l to i t , the only trade or business c a r r i e d on at the h e r e d i t a  ment. (3) References i n t h i s s e c t i o n to the time of v a l u a t i o n are references to the time by reference to which the v a l u a t i o n of a hereditament would have f a l l e n to be as c e r t a i n e d i f t h i s s e c t i o n had not been enacted. (4) This s e c t i o n does not apply to a hereditament which i s occupied by a p u b l i c u t i l i t y undertaking and of which the value f a l l s to be as cer t a i n e d by reference to the p r o f i t s of the undertaking c a r r i e d on t h e r e i n . 151. APPENDIX B As d e f i n e d , the q u a l i t y of an assessment r o l l i s a f u n c t i o n of e q u a l i t y of treatment, and e q u a l i t y of treatment i s achieved when the d i s t r i b u t i o n of the tax burden i s the same as that r e s u l t i n g from a c o r r e c t assessment r o l l . Consequently any measure of assessment r o l l q u a l i t y must i n d i c a t e the p r o x i m i t y of the d i s t r i b u t i o n of the tax burden r e s u l t i n g from an a c t u a l r o l l to that r e s u l t i n g from a c o r r e c t r o l l . For each property, the burden of the tax can be c a l c u l a t e d by d i v i d i n g the assessment by the t o t a l of a l l p r o p e r t i e s on the r o l l . The " t r u e " burden w i l l be found by d i v i d i n g the appropriate c o r r e c t assessment by the t o t a l of the c o r r e c t r o l l , w h i l s t the " a c t u a l " bur den can be determined by d i v i d i n g the a c t u a l assessment by the t o t a l of the a c t u a l r o l l . A l g e b r a i c a l l y , i f the a c t u a l r o l l comprises n assessments a i ( i = 1, 2, 3, . . . n ) , and i f the c o r r e c t r o l l comprises n assessments c i ( i = 1, 2, 3, . . . n ) , then f o r any property ( j ) , the true burden may be c a l c u l a t e d thus: y j = c j and the a c t u a l burden, x j = aj For the r o l l i n general the true and a c t u a l burdens w i l l be represented by y i and x i ( i = 1, 2, 3, . . . n) r e s p e c t i v e l y . These c a l c u l a t i o n s are however dependent on the knowledge of the a c t u a l assessment, the appropriate c o r r e c t assessment and of the 152. t o t a l of the c o r r e c t r o l l . Since we are presuming that the whole r o l l i s a v a i l a b l e f o r e v a l u a t i o n , i t i s assumed that a l l the c o r r e c t assess ments are known. The simplest measure of the q u a l i t y of the r o l l i s the sum of the absolute d i f f e r e n c e s between the c o r r e c t burdens and the a c t u a l burdens. A l t e r n a t i v e l y the sum of the squares of the a c t u a l d i f f e r e n c e s rt may be employed. A l g e b r a i c a l l y they may be expressed as ^ j x i - y i | <r* 2 " x and y ( x i - y i ) . The smaller are the measures the b e t t e r i s the quai l s | i t y of the r o l l . Both of these measures sum the d i f f e r e n c e s between the two d i s t r i b u t i o n s , though f o r the former absolute values are used, w h i l s t f o r the l a t t e r , the d i f f e r e n c e s are squared to remove the s i g n . Consequently greater weight i s given to the l a r g e r d e v i a t i o n s i n the l a t t e r measure. The choice between these two measures w i l l then depend on the weight to be accorded to the l a r g e r d e v i a t i o n s compared w i t h the s m a l l e r . I t w i l l be a value judgement. I t i s considered that a b e t t e r measure than those mentioned, i s one that r e f l e c t s the d e v i a t i o n s as f r a c t i o n s or percentages of the c o r r e c t assessments. One such measure i s : ^ I x i - y i | . This measure y \ l T y i y i r e f l e c t s both the r e l a t i v e over (or under) assessment of each property and a l s o , through the s i z e of the y i ' s , the r e l a t i v e importance of each assessment to the r o l l . The sums of the x i and y i w i l l both be 153. equal to 1, and consequently the s i z e of each x i and y i w i l l depend on the number and s i z e of the assessments on the r o l l , and a l s o on the s i z e of each c o r r e c t and a c t u a l assessment when compared against the t o t a l s i z e of the c o r r e c t and a c t u a l r o l l s . An a l t e r n a t i v e expression K 2 of t h i s concept i s ( x i - y i ) . As before, the smaller i s the value of these measures the b e t t e r i s the q u a l i t y of the r o l l . I n the second measure however, the numerator i s squared to remove the s i g n , and the e f f e c t i s to give more weight to the l a r g e r d i f f e r e n c e s p a r t i c u l a r l y when they are a greater percentage of the cor r e c t burden. As before, the choice between these two measures, and between them and the two measures mentioned p r e v i o u s l y , w i l l be based on a value judgement. I t should be noted that although the l a t t e r two measures i n d i c a t e the i n e q u a l i t y of the assessment r o l l by summing percentage d e v i a t i o n s , they are not themselves percentages, but are merely mea sures enabling a comparison to be made between d i f f e r e n t r o l l s . Since we are concerned w i t h the g o o d n e s s - o f - f i t of the two d i s t r i b u t i o n s , i t might be considered that c o r r e l a t i o n a n a l y s i s or c h i - square a n a l y s i s could be used. However they appear to be u n s u i t a b l e i n these circumstances. The c o e f f i c i e n t of c o r r e l a t i o n i n d i c a t e s the amount of the t o t a l v ariance of the data that i s explained by a trend l i n e . Although a trend l i n e r e p r e s e n t i n g a c o r r e c t r o l l can be produced, ( i t i s a 45° 154. l i n e on a s c a t t e r diagram where the axes, true burden and a c t u a l burden, have the same s c a l e ) , c o n s i d e r a t i o n of the t o t a l v a r i a n c e w i t h i n the d i s t r i b u t i o n of "actual b u r d e n s r e n d e r s the c o e f f i c i e n t of c o r r e l a t i o n an u n s a t i s f a c t o r y measure since the q u a l i t y of a r o l l i s dependent on the p r o x i m i t y of the x i to the y i and not to the mean. S i m i l a r l y as the chi-square a n a l y s i s i s intended to examine the goodness of f i t of frequency d i s t r i b u t i o n s , i t appears to be an uns u i t a b l e measure of the goodness of f i t of the a c t u a l tax-burden d i s t r i b u t i o n to that r e s u l t i n g from a c o r r e c t r o l l . The data w i t h which we are d e a l i n g cannot be meaningfully grouped i n t o a frequency d i s t r i b u t i o n and submitted to a chi-square a n a l y s i s . This i s apparent when i t i s seen that i f each movement of an entry from one i n t e r v a l to another were matched by a movement of another entry i n the opposite d i r e c t i o n , the d i s t r i b u t i o n would i n d i c a t e no i r r e g u l a r i t i e s d e s p i t e the p o s s i b l e existence of gross i n e q u a l i t i e s . A c o n t r a s t should be drawn between a chi-square a n a l y s i s and the f o u r t h measure mentioned above ( ^ ( x i - y i ) 2 ) which has the fr. y 1 same formula as that used f o r chi-square. Conclusions * 2 A 1. The measures > ( x i - y i ) ; > I x i - y i | can be used £ ( x i - y i ) ; C | x i - y i | as measures of the goodness of f i t , the lower i s t h e i r v a l u e , the bet t e r i s the f i t . However, t h e i r use as absolute measures of the q u a l i t y of d i f f e r e n t r o l l s may be l i m i t e d . 155. 2. The measures ^ ( I x i - y i ) / y i ) ; ^ __ ( x i - y i ) i n i*i / y_/ appear to be of greater s i g n i f i c a n c e than the previous measures when comparing d i f f e r e n t r o l l s , s ince allowance i s made f o r the r e l a  t i v e s i z e of each assessment and thereby a l s o the number of assess ments on the r o l l . 3. The choice between these measures w i l l be based on a value judgement as to the nature of the weighting ( i f any) to be as signed to the l a r g e r d e v i a t i o n s . 4 . The c o e f f i c i e n t of c o r r e l a t i o n and chi-square a n a l y s i s appear to be imperfect measures of the goodness of f i t of the d i s t r i  b u t i o n of the tax burden under an a c t u a l r o l l to that under a c o r r e c t r o l l . 156. APPENDIX G I t can be seen a l g e b r a i c a l l y t h a t a uniform change i n a l l assessments w i l l leave unaltered the d i s t r i b u t i o n of the burden of the tax. Where a r o l l e x i s t s comprising na assessments, x i , so that assessment (represented by the j t h assessment) w i l l be x j / x i . I f each assessment i s increased by a f r a c t i o n a., the t o t a l of a l l assessments would increase to _*_» x i . a which i s the same as a. §_ x i . Since each assessment increases by a, the burden borne by each w i l l be x j . a . The a's cancel out l e a v i n g x j / 23 x i a s before, a J£_ x i Thus there i s no change i n t h e d i s t r i b u t i o n of the burden of the tax, as a r e s u l t of a uniform change i n a l l assessments. 

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