Present: Beetz, Lamer, Le Dain, La Forest and L'Heureux‑Dubé JJ.
on appeal from the court of appeal for quebec
Municipal law ‑‑ Real estate assessment ‑‑ Amendment of assessment roll ‑‑ Mandamus ‑‑ Assessment roll deposited for municipal fiscal year 1980 ‑‑ Roll prepared in accordance with provisions of legislation prior to the new Act on municipal taxation ‑‑ Refusal by assessor to amend assessment roll to take into account median proportion mentioned in new Act ‑‑ Whether assessor refused to perform duty imposed on him by new Act‑‑Act respecting municipal taxation and providing amendments to certain legislation, S.Q. 1979, c. 72, ss. 42, 147, 264, 531.
In November 1979, the M.U.C. assessor deposited assessment rolls for 1980 for the various municipalities in his area. The roll had been prepared in accordance with the provisions of the Real Estate Assessment Act in effect at the time and, under s. 8, immovables were entered on the roll at their actual value. In December 1979, the Real Estate Assessment Act was replaced by the Act respecting municipal taxation and providing amendments to certain legislation. The new Act provided that assessment rolls already deposited for 1980 were valid (s. 530), but they had to be amended retroactive to January 1, 1980 to "take account of the provisions of [the new Act] that are applicable to it and that differ from those of the Real Estate Assessment Act" (s. 531). For the fiscal year 1980, respondent's immovable was valued at $19,001,600 and the median proportion set at 79%. In respondent's submission the real estate value of the immovable would have been $15,011,264 if the M.U.C. had made the assessment of the immovable taking into account the median proportion mentioned in the new Act. As the M.U.C. assessor refused to amend the assessment roll, respondent, relying principally on s. 531 of the new Act, applied to the Superior Court for a writ of mandamus. The Superior Court dismissed the application but the Court of Appeal reversed the judgment. Basing itself on ss. 531, 42 and 264 of the new Act, the latter concluded that the assessor had a duty to amend the entry automatically to take the median proportion into account. This appeal is to determine whether the M.U.C. assessor failed or refused to carry out a duty imposed on him by the new Act on municipal taxation in respect of the real estate value entered on the M.U.C. assessment roll.
Held: The appeal should be allowed.
The assessor was not required, under the Act respecting municipal taxation and providing amendments to certain legislation, to take the "median proportion" into account in preparing the M.U.C. real estate assessment roll for 1980. As he did not fail or decline to carry out a duty imposed on him by the Act, respondent's motion for a writ of mandamus must be dismissed.
By its very definition, the median proportion is a proportion of the roll in its entirety and can only be determined once the roll has been prepared, using the roll itself as the basis of calculation. Section 264 of the Act, which introduces the new concept of a "median proportion", nowhere requires the assessor to take it into account in preparing the roll. On the contrary, all that section requires the assessor to do is to indicate on the roll the median proportion and the comparative factor resulting from it. Moreover, this proportion can be determined by the Minister if the assessor fails to do so. No one would argue that the Minister has the power to prepare the roll or that the effect of the "median proportion" determined by the Minister would be to alter the values entered on the roll. The median proportion is intended as a measure of the level of the roll; it is not a factor for correcting the roll. Its purpose is to be used by the taxpayer as a means of checking whether the value entered on the roll corresponds to the actual value of his immovable once the comparative factor has been applied. If it does not, the taxpayer may file a complaint with the Bureau de révision de l'évaluation foncière du Québec, which once the actual value of the immovable in question has been determined will have to take the median proportion into account (s. 147). That was the legislator's objective in adopting ss. 147 and 264 of the Act.
The phrase "same proportion" mentioned in s. 42 could not refer to the "median proportion" of s. 264. Section 42 provides that the "roll must indicate the value of each [immovable] on the basis of its actual value", and that the "values entered on the roll must represent, in relation to the aggregate of the [immovables] entered on the roll, the same proportion of the actual value of that aggregate". The objective of s. 42 is to allow the assessor some flexibility in preparing the roll. Using the actual value as defined by the Act as a basis, he can henceforth quite legally set the value of immovables at a certain proportion of the actual value. The second paragraph of s. 42 requires him to respect this proportion on all immovables assessed in the roll, hence the resulting fiscal equity. In adopting s. 42, the legislator sought to ensure that all taxpayers would be treated on an equal footing.
Finally, the transitional provision in s. 531 of the Act does not require the assessor to take the "median proportion" into account in preparing the roll. That section is concerned with the "median proportion" only to the extent that an assessor must indicate it in the roll with the comparative factor and forward this information to the Minister within the specified time (s. 264).
Cases Cited
Considered: Communauté urbaine de Montréal v. Dorchester Commerce Realty Ltd., [1984] C.A. 426; Gorham v. Communauté urbaine de Montréal, J.E. 87‑116.
Statutes and Regulations Cited
Act respecting municipal taxation, R.S.Q., c. F‑2.1, ss. 33, 42, 43‑46, 55 et seq., 63 et seq., 124, 147, 174, 175, 263(5), 264, 496, 527, 530, 531, 550.
Act respecting municipal taxation and providing amendments to certain legislation, S.Q. 1979, c. 72 [now R.S.Q., c. F‑2.1], ss. 33, 42, 43‑46, 55 et seq., 63 et seq., 124, 147, 174, 175, 263(5), 264, 496, 527, 530, 531, 550.
Act to amend certain legislation respecting municipalities, S.Q. 1980, c. 34, ss. 50, 76.
Act to amend legislative provisions concerning municipalities, S.Q. 1983, c. 57, ss. 110, 116.
Code of Civil Procedure, R.S.Q. 1977, c. 25, ss. 834 et seq.
Minimum Requirements for the Form and Content of Various Documents Regarding Municipal Assessment and Taxation (Amendment) Regulation, (1984) 116 O.G. II. 3791.
Real Estate Assessment Act, S.Q. 1971, c. 50, s. 8 [repl. 1973, c. 31, s. 4; am. 1975, c. 68, s. 7; repl. 1979, c. 22, s. 65], 69 [am. 1973, c. 31, s. 34; repl. 1975, c. 68, s. 26].
Regulation respecting rules to determine the median proportion of the actual real estate value of units of assessment that corresponds to the values entered on the real estate roll, R.R.Q. 1981, c. F‑2.1, r. 11, s. 1.
Regulation respecting the form or the minimum content of various documents related to municipal assessment and taxation, (1983) 115 O.G. II. 3543.
Regulation respecting the minimal content of notices of assessment and accounts for municipal taxes, R.R.Q. 1981, c. F‑2.1, r. 1.
Authors Cited
Caumartin, Claude. "Certains aspects techniques". Dans La réforme de la fiscalité municipale. Formation permanente du Barreau du Québec, cours 51, 1980, pp. 63 à 82.
L'Heureux, Jacques. Droit municipal québécois, t. II. Wilson & Lafleur/Sorej, 1984.
Lortie, Jean‑Pierre. Loi sur la fiscalité municipale, étude analytique et comparative. Montréal: Yvon Blais Inc., 1980.
Pâquet, Jean‑Marie. "Les aspects juridiques". Dans La réforme de la fiscalité municipale. Formation permanente du Barreau du Québec, cours 51, 1980, pp. 21 à 59.
Quebec. Government of Quebec. Report of the Royal Commission on Taxation. Québec: The Commission, 1965.
APPEAL from a judgment of the Court of Appeal for Quebec, [1986] R.D.J. 147, setting aside a judgment of the Superior Court1 denying a writ of evocation. Appeal allowed.
1 Mtl. Sup. Ct., No. 500‑05‑005803‑810, January 18, 1983.
Gérard Beaupré, Q.C., and Bernard Taillefert, for the appellants.
Jean‑Marie Pâquet, for the respondent.
Yvon Denault, for the mis en cause the city of Lachine.
English version of the judgment of the Court delivered by
1. L'Heureux‑Dubé J.‑‑This case concerns the interpretation of various sections of the Act respecting municipal taxation, R.S.Q., c. F‑2.1, enacted by the Act respecting municipal taxation and providing amendments to certain legislation, S.Q. 1979, c. 72 ("the Act"), assented to and in force on December 21, 1979 and taking effect on January 1, 1980. This Act replaced the Real Estate Assessment Act, S.Q. 1971, c. 50, and was designed to be a major reform of the municipal taxation system.
2. By a mandamus directed against the then assessor of the Montreal Urban Community ("M.U.C.")‑‑which was the mis en cause and is here the appellant‑‑Northern Telecom Limited ("Nortel") disputed the real estate assessment of its immovable located in the city of Lachine, also mis en cause. This immovable was entered in the M.U.C. assessment roll for the city of Lachine for 1980 at a value of $19,001,600. In Nortel's opinion, this value should have been $15,011,264 if the M.U.C. had made the assessment in accordance with the provisions of the Act, and hence the application for mandamus to enjoin the M.U.C. assessor to amend the entry on the assessment roll for this property for the year 1980. The case concerns both the nature of the action brought by Nortel and the interpretation inter alia of the new concept of "median proportion" introduced by the Act.
Facts
3. On November 14, 1979 the M.U.C. assessor deposited the M.U.C. assessment rolls for 1980 in accordance with the Real Estate Assessment Act then in effect, entering the immovables at their actual value as provided in s. 8:
8. Except where otherwise provided by this act, all immoveables must be entered on the roll and be entered at their actual value . . . .
4. On January 7, 1980 Nortel received a provisional tax account from the city of Lachine and on September 3, 1980 a final account. The latter indicated a real estate value of $19,001,600, a median of 79% and a comparative factor of 1.27. On March 19, 1981 Nortel sent a notice to the M.U.C. assessor requiring him to amend the assessment roll to take into account improvements of some $61,000 made to the immovable (s. 174(7)), a notice ignored by the assessor as he was of the view that these improvements had very little effect on the estimated value (.003%). On May 4, 1981 the motion for a writ of mandamus was served. It was authorized on June 8, 1981 in accordance with the two‑stage procedure then in effect under the Code of Civil Procedure (arts. 834 et seq.), subsequently amended, and the case was heard on January 18, 1983.
5. Conclusion (b) of the motion for a writ of mandamus, which is relevant here, reads:
[TRANSLATION]
(b) DIRECT respondent to amend in keeping with the provisions of the Act respecting municipal taxation the value shown for applicant's immovable on the assessment roll of the mis en cause city of Lachine for its 1980 fiscal year, as roll No. 007367‑00, pursuant to the provisions of ss. 531, 174(7) and 175 et seq. of the Act respecting municipal taxation;
Judgments
1. Superior Court
6. Upon hearing the motion on its merits, the Superior Court dismissed it essentially on the grounds that, upon analysis of the evidence, the minimal improvements made to the immovable, without obtaining a building permit, to the extent that they were improvements to the real estate, could not affect the value of the immovable and thus did not require amendments to be made to the roll. He further considered that mandamus was not the proper remedy to obtain the relief sought under ss. 531, 174 and 175 of the Act and that the proper forum was the "Bureau de révision de l'évaluation foncière du Québec" (B.R.E.F.), which is responsible for considering complaints filed under ss. 124 et seq. of the Act.
7. The Superior Court judge considered that Nortel [TRANSLATION] "is trying by mandamus to revive a right which has expired . . . a right of appeal which it inadvertently allowed to become prescribed", and he concluded:
[TRANSLATION] ... the Court is of the view that the assessor exercised his discretion, took into account the provisions of the Act and made his decision not to amend the assessment because in his opinion as an assessor it did not have to be amended. The decision may be open to challenge but any challenge to it should be made in another forum.
2. Court of Appeal
8. Jacques J.A., rendering the unanimous judgment of the Court of Appeal, [1986] R.D.J. 147 (Bisson, Jacques and LeBel JJ.A.), discussed the sole question which was the subject of the appeal (at p. 148):
[TRANSLATION] The value of $19,001,600 shown on the roll represents the actual value of the immovable. The median proportion applicable for fiscal year 1980 was set at 79%. Appellant is accordingly asking that the recorded value be $15,011,264.
Appellant submitted that the assessor had a duty to amend the record automatically to take the median proportion into account, in accordance with s. 531(1) of the Act:
531. Before 15 September 1980, a real estate assessment roll or a roll of rental values contemplated in section 530 must be amended in conformity with Chapter XV to take account of the provisions of this act that are applicable to it and that differ from those of the Real Estate Assessment Act.
(. . .)
(emphasis added)
The particular provision of the Act applicable to the recording of appellant's immovable, which is different from those of the earlier Act, is s. 42(2):
"The values entered on the roll must represent, in relation to the aggregate of the units of assessment entered on the roll, the same proportion of the actual value of that aggregate."
This paragraph provides for application of the median proportion, the implementation of which is explained in s. 264. This proportion is the median proportion of the actual real estate value of units of assessment (that is, a complete immovable) which corresponds to the values entered on the roll: that is, the entered value of all the immovables must represent the same proportion of their respective actual values. [Emphasis added.]
He concluded (at pp. 148‑49):
[TRANSLATION] I consider that s. 531 imposed a duty on the assessor to amend the roll automatically.
Since the assessor did not do this, there was a breach which will be a basis for the extraordinary remedy specified in art. 844 of the Code of Civil Procedure.
The words "must be amended" used in s. 531 indicate an "absolute" obligation. This interpretation is consistent with s. 51 of the Interpretation Act, R.S.Q., c. I‑16, which states that "Whenever it is provided that a thing ... `must' be done, the obligation is imperative . . .".
The context of the Act also supports this interpretation. As section 496 states that the Act takes effect beginning with the 1980 fiscal period, there had to be a transitional provision ensuring that rolls deposited under the earlier legislation would be made consistent with new provisions. Section 531 allows up to September 15, 1980 to do this, and the Act puts back budget deadlines by three months accordingly (s. 534), provides for the sending of provisional accounts (s. 537), and finally, prohibits actions to quash or annul a roll made and deposited under the earlier legislation on the ground that it does not conform to a provision of the new Act (s. 530).
Points at Issue
9. In this Court appellant (the M.U.C. and its assessor) stated the issues as follows:
[TRANSLATION]
(1) The Court of Appeal erred in law by interpreting s. 531 of the Act as requiring the Montreal Urban Community assessor to reduce the assessment of respondent's immovable to the median proportion on the real estate assessment roll for the fiscal year 1980;
(2) The Court of Appeal erred in law by intervening in the exercise of the Superior Court's discretion;
(3) The Court of Appeal erred in law by deciding that a mandamus should issue once a breach had been committed, thereby misunderstanding the discretionary nature of the mandamus remedy;
10. Before getting to the heart of the matter, it may be useful to recall the context in which this new legislation was elaborated and in so doing clarify its purpose and facilitate its interpretation.
Legislative Background
11. The adoption of Bill 57 on municipal taxation on December 21, 1979 was the culmination of a more general reform of the Quebec tax system announced some decades earlier, which gave rise among other things to the Royal Commission on Taxation. The Bélanger Report, in its Chairman's name, published in 1965, proposed a sweeping reform designed to ensure fiscal equity in all areas of taxation, including municipal taxation (Report of the Royal Commission on Taxation (1965)). In 1971 the Real Estate Assessment Act was adopted and was amended several times before the adoption some eight years later of the Act. This statute was a complete revision of the former legislation as part of the reform of municipal taxation.
12. There is no need to discuss certain aspects of this reform, such as the integrity and expansion of the tax base, a survey of the changes affecting real estate assessment will be sufficient.
13. A tax on real estate has existed in Quebec for nearly two centuries and its cornerstone is the actual value of immovables. The assessment roll has a critical part to play, as is explained by Claude Caumartin, "Certains aspects techniques", in La réforme de la fiscalité municipale, Formation permanente du Barreau du Québec, cours 51, 1979‑80, p. 63, at p. 66:
[TRANSLATION] The valuation roll does not impose a tax. It is a means of distributing the financial burdens resulting from municipal budgets. If the roll is equitable, each taxpayer will bear his fair share of the financial responsibility. This is where the drama of municipal taxation lies.
14. For many years a number of factors contributed to create an imbalance in municipal taxation: a steadily increasing demand for municipal services leading to a significant increase in government grants at the expense of municipal autonomy, the vagaries of the real estate market, unprecedented inflation and an unequal increase in value of one class of immovables compared with another. Further, assessment rolls were not redone regularly but for the most part simply updated using correction indexes and not reflecting the growth rates in various classes of immovables. When new rolls were prepared, it was to be feared that a massive transfer of fiscal burdens to certain classes of immovables would occur in favour of other classes (Caumartin, loc. cit., at p. 65). The same writer comments on another aspect of the reform at p. 66:
[TRANSLATION] Where taxpayers are concerned, the present rules on real estate taxation require that the burden resulting from the budget be divided in proportion to real estate values. The value of real estate does not necessarily depend on the will of a single owner, but on all the economic activity taking place in a given area.
15. Moreover, under s. 69 of the Real Estate Assessment Act, the B.R.E.F. had to take into account s. 8 of that Act which provided that all immovables had to be entered at their "actual value". An imbalance in the division of the tax burden resulted from the fact that certain comparable immovables were entered on the role at a lower value, and the B.R.E.F. was powerless to correct this imbalance. The only available remedy was a motion to quash or an action to annul an assessment roll. The purpose of the Act was to correct these various anomalies.
The Act
16. The assessment of real estate is the basis of an equitable distribution of all municipal tax burdens. The Act introduced the principle of equity between various real estate assessments on the one hand, by adopting a more realistic approach to the value of immovables entered on the assessment roll, and on the other, by providing that all immovables be assessed at the same level in terms of their actual value (Jean‑Marie Pâquet, "Les aspects juridiques", in La réforme de la fiscalité municipale, op. cit., p. 21, at p. 33). These principles were stated in s. 42 of the Act, as it read at the time of the case at bar:
42. The roll must indicate the value of each unit of assessment, on the basis of its actual value.
The values entered on the roll must represent, in relation to the aggregate of the units of assessment entered on the roll, the same proportion of the actual value of that aggregate.
This section was amended in 1983 (the Act to amend legislative provisions concerning municipalities, S.Q. 1983, c. 57, s. 110):
42. The roll must indicate the value of each unit of assessment, on the basis of its actual value.
The values entered on the roll of a municipal corporation must, on the whole, tend to represent the same proportion of the actual value of the units of assessment.
No motion or action to quash or set aside the roll or any entries on the roll may be brought on the ground of a contravention of the second paragraph.
17. This amendment, which was not in effect when the proceedings at bar were brought, has no incidence on the outcome of this case. If I occasionally refer to it, it is only for the purpose of clarification and out of a concern for accuracy.
18. As I mentioned earlier, under s. 8 of the Real Estate Assessment Act, immovables had to be entered on the roll at their actual value (the concept of actual value, now defined in ss. 43 to 46 of the Act, is not the subject of this discussion). As we know, in practice, that was not the case. Real estate assessment rolls rarely represented the actual value of the immovables therein inscribed, especially in the subsequent years as the same roll, corrected and amended in accordance with the Act but not entirely redone, was used. The legislator undoubtedly intended to adjust the Act to reality since this is no longer the case. Under section 42(1) of the Act, the value of immovables is entered on the roll on "the basis of its actual value". It will be sufficient if the value, as defined in ss. 43 et seq. of the Act, entered on the roll represents or, since the 1983 amendments, tends to represent, a proportion of the actual value, a proportion which may be either less or more than the actual value but which must be uniform for all immovables entered on the roll (Jacques L'Heureux, Droit municipal québécois (1984), tome II, at p. 388).
19. By section 42(2) of the Act the legislator sought to ensure that all taxpayers would be treated on an equal footing. The value entered on the roll for each immovable (unit of assessment) must represent the "same proportion of the actual value" in relation to units of assessment entered on the roll as a whole. It is the phrase "same proportion of the actual value" which is at the heart of this case, and I will return to this. For the moment, it is appropriate to refer to the machinery provided in the Act for this purpose:
264. The assessor, at the same time as he deposits the real estate assessment roll or the roll of the rental values of a municipal corporation, shall indicate the median proportion of the actual real estate value of the units of assessment, or of the actual rental value of the places of business or premises, to which the entered values correspond. He shall also indicate the comparative factor of the roll, which is the inverse of the median proportion calculated in accordance with this paragraph.
The assessor shall, in writing, communicate to the Minister the median proportion and the factor he has established.
The municipal corporation may request the Minister to establish the median proportion and the factor for its roll, in the place of the assessor.
The Minister, on receiving the median proportion and the factor calculated by the assessor, shall approve them, subject to the fifth paragraph; they are thenceforth deemed established by the Minister.
If the median proportion calculated by the assessor varies by over 2.5% from that calculated by the Minister for the same roll, that calculated by the Minister, and the corresponding comparative factor, prevail.
The regulation made under paragraph 5 of section 263 applies when the assessor or the Minister establishes the median proportion contemplated in the first paragraph.
The Minister shall, in writing, communicate the proportion and the factor established under this section to the municipal corporation or municipality concerned.
The proportion and the factor must appear on the municipal or school real estate tax account or on the business tax account, as the case may be. [Emphasis added.]
20. This section has been amended several times, but for the purpose of this discussion it will suffice to reproduce the amendments introduced in 1980, retroactive to January 1, 1980 (An Act to amend certain legislation respecting municipalities, S.Q. 1980, c. 34, ss. 50 and 76):
50. Section 264 of the said act, amended by section 133 of chapter 11 of the statutes of 1980, is again amended by inserting, after the fifth paragraph, the following paragraph:
"If, by 1 November, the assessor has not communicated in writing to the Minister the median proportion and the factor of the roll, the Minister may establish the median proportion and the factor in his stead. However, the assessor may remedy his failure to act as long as the Minister has not complied with the eighth paragraph."
76. Sections 12, 13, 19, 20, 25, 27 to 30, 33 to 51, 54, 55, 57, 58 and 60 to 68, and section 579.1 of the Act respecting municipal taxation and providing amendments to certain legislation enacted by section 59, have effect from 1 January 1980.
The first paragraph does not affect a decision or a judgment rendered or a case pending on 27 November 1980.
21. Section 147, which at the time referred to s. 42, read as follows:
147. The board, when deciding a complaint regarding the value entered on the roll of a unit of assessment, shall establish the value to be entered by determining the actual value of the unit of assessment, within the meaning of sections 43 to 46, and by the application of the rule provided in the second paragraph of section 42, subject to sections 47 to 54.
For the purposes of this section, the board may fix a lower or higher value than those proposed by the parties. [Emphasis added.]
22. It has since been amended, inter alia in 1983 by s. 116 of the Act to amend legislative provisions concerning municipalities to read:
147. Where the board, on deciding a complaint regarding the value entered on the roll of a unit of assessment, considers that the value must be changed to prevent actual prejudice, it shall fix the value to be entered by dividing the actual value of the unit of assessment that it has established in accordance with sections 43 to 46 by the factor of the roll determined under section 264, subject to sections 47 to 54.
For the purposes of this section, the board may fix a lower or higher value than those proposed by the parties. [Emphasis added.]
23. The definition of "median proportion" referred to in s. 264 of the Act is to be found in the Regulation respecting rules to determine the median proportion of the actual real estate value of units of assessment that corresponds to the values entered on the real estate roll, R.R.Q. 1981, c. F‑2.1, r. 11, in effect on March 11, 1980 and replaced on August 31, 1983. Section 1 of this Regulation, adopted pursuant to s. 263(5) of the Act, reads as follows:
1. The median value of the assessments entered on the real estate roll proportional to the actual real estate values of the units of assessment of a municipal corporation is the median of the quotients obtained by dividing the value entered on the real estate roll of each unit that was sold within the meaning of section 3 or 4 by the sale price. This median is expressed as a percentage. [Emphasis added.]
24. The method of calculation set out in other sections of the Regulation is better explained and illustrated in this comment by Jean‑Pierre Lortie, Loi sur la fiscalité municipale, étude analytique et comparative (1980), at pp. 16‑17:
[TRANSLATION] The median proportion of the actual real estate value of units of assessment to which the values entered on the real estate assessment roll of a municipal corporation correspond is the median of the quotients obtained by dividing by their sale price the value entered on the real estate assessment roll for each unit which was the subject of a sale made in accordance with certain criteria. The comparative factor of the roll is the inverse of the median proportion.
This may be illustrated by an example: the following is the assessment/sale relationship of five units of assessment and the ratio in percentages.
(1) 30,000/50,000 60%
(2) 35,000/40,000 90%
(3) 40,000/90,000 40%
(4) 300,000/700,000 40%
(5) 60,000/72,000 80%
The median proportion would be 60%. The factor is established as follows:
100 i.e. 100% = 1.66
median proportion 60%
The standardized value is thus the value entered on the roll multiplied by the said factor.
It is the function of the assessor to indicate the median proportion and the comparative factor of the roll. However, the municipal corporation may ask the Minister to calculate the median proportion and the factor of its roll, in place of the assessor (s. 264 M.T.A.). [Emphasis added.]
25. Under the Act, and this is new, three essential particulars must be shown on the notice of assessment or the tax account in lieu thereof: the value entered on the roll, the median proportion and the comparative factor. For 1980 this resulted from s. 527 of the Act, "Until the regulation contemplated in subparagraphs a and b of paragraph 2 of section 263 comes into force . . . ." On December 9, 1980 the Regulation respecting the minimal content of notices of assessment and accounts for municipal taxes, R.R.Q. 1981, c. F‑2.1, r. 1, came into effect, containing the same requirement as s. 527 as to the particulars mentioned above. (This Regulation has since been replaced by the Regulation respecting the form or the minimum content of various documents related to municipal assessment and taxation, M.O., October 26, 1983, (1983) 115 O.G. II 3543).
26. The value entered on the roll corresponds to a certain percentage of the actual value. This percentage is reflected in the median proportion. These particulars allow a taxpayer to determine the accuracy of the assessment of his unit of assessment. To do this the taxpayer multiplies the value entered on the roll by the inverse of the median proportion, the comparative factor. He thus obtains the total standardized value which is meant to represent the actual value of his unit of assessment. This value allows him to determine whether or not he has been assessed at the same level as other taxpayers in his municipality and to decide whether or not to challenge the assessment. Since 1985, a taxpayer no longer has to make the calculation since in addition to the three particulars mentioned above, the total standardized value must be shown on the notice of assessment or on the tax account in lieu thereof (Minimum Requirements for the Form and Content of Various Documents Regarding Municipal Assessment and Taxation (Amendment) Regulation, M.O., November 14, 1984, (1984) 116 O.G. II 3791). Accordingly, if the total standardized value is greater than what the taxpayer considers to be the actual value of his immovable, he can file a complaint with the B.R.E.F.
27. While section 42 of the Act sets out the principles that must be used as guidelines in preparing real estate assessment rolls, s. 264 sets out the method of implementation. According to that section, it is the assessor's function to indicate the median proportion and the comparative factor of the roll when deposited. The question here is whether in the preparation of the roll the assessor must take this median proportion into account, or, in other words, prepare his roll on the basis of the median proportion. It can easily be seen that the word "proportion" in ss. 42 and 264 of the Act is at the source of the confusion. However, before dealing with this it will be necessary to examine the transitional provisions contained in the Act, provisions which have some bearing on the case at bar as it arose during this transition period.
Transitional Provisions
28. The Act, assented to in 1979, took effect from January 1, 1980 in accordance with s. 496. Since on that date the assessment rolls for 1980 had generally been deposited, as was the case with the M.U.C. for the city of Lachine, the Act provided that these rolls were valid (s. 530), but that, before September 15, 1980, they had to be amended retroactive to January 1, 1980 to take into account the provisions of the Act that differed from those of the Real Estate Assessment Act (s. 531), and for this purpose challenges to the roll were suspended for a certain period of time (s. 550):
496. Unless otherwise provided, this act has effect for the purposes of all municipal fiscal periods, beginning with the fiscal period 1980.
530. A real estate assessment roll or a roll of rental values made and deposited for the municipal fiscal period 1980, in conformity with the Real Estate Assessment Act, is valid and no action to quash it or to annul it may be introduced on the ground that it does not conform to a provision of this act that differs from a provision of the Real Estate Assessment Act.
For the purposes of this section, the roll of rental values of the City of Montreal in force on 21 December 1979 is deemed to have been made and deposited on 15 November 1979 in conformity with the Real Estate Assessment Act, for its fiscal period 1980.
531. Before 15 September 1980, a real estate assessment roll or a roll of rental values contemplated in section 530 must be amended in conformity with Chapter XV to take account of the provisions of this act that are applicable to it and that differ from those of the Real Estate Assessment Act.
For the purposes of this section, the word "unduly" in section 174 shall be construed as if the roll were required to have been made in conformity with this act at its coming into force.
An amendment made under this section cannot have effect to a time prior to 1 January 1980.
550. A complaint or a recourse to quash or to set aside the real estate assessment roll or the roll of rental values may be introduced not later than sixty days, three months or one year, respectively, after the sending of accounts contemplated in section 544 or 547.
The prohibition under section 530 from seeking the quashing or setting aside of a roll ceases to apply from the date the accounts are sent.
29. This is the background against which the arguments of the parties, both substantive and procedural, must now be examined.
Assessment
30. On November 14, 1979 the M.U.C. assessor deposited assessment rolls for 1980 for the various municipalities in his area, including the city of Lachine. This roll had been prepared, as required, in accordance with the provisions of the Real Estate Assessment Act in effect at the time. This meant that the immovables were entered on the roll at their actual value, or at least what the M.U.C. assessor regarded to be the actual value. This was confirmed by the witness André Massé, the assessor responsible for preparing the roll for the city of Lachine:
[TRANSLATION]
...A. Right, we considered the wording of s. 531, and after very pleasant and lengthy discussions we concluded that it was not necessary to amend the values as shown on the roll, for the purposes of giving effect to s. 531 as such.
Q. When you say "to amend the values", this is still with respect to the Northern Telecom immovable?‑‑or for the Lachine roll as a whole?
...A. For Northern Telecom and for Lachine properties as a whole.
Q. Was there any mention in your discussions of a median, Mr. Massé?‑‑the famous median.
...A. For an assessor, the median is a consequence at all times. We prefer, if you like, to use the word "target"‑‑because the median is established once the facts are determined.
Q. Hmm.
...A. And the assessor cannot determine the median first: he can only try to reach a target.
Q. All right; but you know the expression "median proportion" nevertheless?
...A. Yes, I know it.
Q. All right. Now as regards s. 531, what did the department conclude for the fiscal year 1980?
...A. That it did not have to be applied, and that for 1980 it should simply ensure that the values which were deposited were the actual values.
31. The "target" mentioned by the witness is, if I understand him correctly, the percentage of the actual value of an immovable which an assessor aims at when preparing his roll, based on certain indicia and data recognized by assessors. It would appear that this "target" generally corresponds to the median proportion, which the latter may or may not subsequently confirm, and which the Minister may correct if necessary (s. 264). This is how I read the witness Massé's statement that "For an assessor, the median is a consequence at all times . . . because the median is established once the facts are determined".
32. This is also how I read the statement by counsel for the M.U.C. at the hearing that the M.U.C. assessor never takes the median into account in preparing the assessment rolls for municipalities in the M.U.C. territory, no more now than in preparing the roll for 1980.
33. The M.U.C. assessor consequently prepared the roll for 1980 in accordance with the provisions of the Real Estate Assessment Act in effect at the time, and did not take the median proportion into account in preparing the roll, as, in his opinion, s. 531 of the Act did not require him to do so. However, it should be noted that both the median proportion (79%) and the comparative factor (1.27) appear in Nortel's final tax account, as required by the Act (s. 527). Further, again according to the testimony of André Massé, the Nortel immovable was entered on the real estate assessment roll for 1980 at its actual value:
[TRANSLATION]
Q. In '81, it is $19,822,000.
...A. That's correct.
Q. And this assessment represents the actual value of the immovable in question, in your opinion?
...A. For what year, sir?
Q. For '79 and '80 and '81, which is shown on your file card.
...A. '79, '80‑‑it represents the actual value.
Q. For '81?
...A. They represent a certain percentage of the actual value.
Q. What percentage?
...A. It is a target, since the median is a consequence following deposit of the roll‑‑it is a target that is aimed at.
Q. So what was your target in '81?
...A. Approximately 90.
Q. So '81 represented 90% of the actual value‑‑which is your target.
...A. That's correct. [Emphasis added.]
34. If that is the case, taking the median proportion of 79% and the reciprocal, 1.27, namely the comparative factor shown on the tax account, the actual value of the immovable in question would have been $24,132,032 computed by multiplying the value entered in the roll for the Nortel immovable in 1980, namely $19,001,600, by the comparative factor of 1.27. If that value did not in Nortel's opinion represent the actual value of the immovable, Nortel could file a complaint with the B.R.E.F. in accordance with ss. 124 et seq. of the Act within the specified deadline.
35. The reason why Nortel did not file such a complaint in due time was explained by the Superior Court judge:
[TRANSLATION] It is important to point out that the Superior Court is not a review board. Applicant clearly failed to appeal its assessment for 1980. It appears from the evidence that an appeal was filed for 1978 and for 1979, and that an appeal was also filed for 1981, but that no appeal was filed for 1980. It is therefore apparent that applicant is trying by mandamus to revive a right which has expired. Indeed, Mr. Bain, applicant's representative, quite honestly said this at the examination for discovery, when he stated at the bottom of p. 18:
"Well I guess the main reason is that you know, I am green, I did not instruct our solicitors to lodge an appeal because I believed that a certificate would be issued based on the fact that this is our Montreal plant with a lot of machine footings and so on."
Also on page 18, Mr. Bain answered in the affirmative a question put to him by Mr. Taillefer as to whether in fact this was not an attempt to indirectly institute an appeal for 1980.
36. The question before the Court is not whether the Nortel immovable was assessed at its actual value in the M.U.C. real estate assessment roll for 1980, nor to determine what that value is or what value the B.R.E.F. would have approved in the event that a complaint had been filed, nor even whether the time limit for filing such a complaint had expired when these proceedings were instituted. The only question before this Court is whether the M.U.C. assessor failed or refused to carry out a duty imposed on him by the Act in respect of the real estate value entered on the M.U.C. assessment roll for the Nortel immovable in the city of Lachine for 1980. If he did, the writ will issue.
Sections 42, 147 and 264
37. The outcome of the case at bar depends essentially on the interpretation of ss. 42, 147 and 264 of the Act as they stood at the time and which I reproduced above.
38. As I have already mentioned, the phrase "the same proportion" in s. 42(2) of the Act was interpreted in various ways. To the M.U.C. assessor this phrase does not in any way refer to the "median proportion" mentioned in s. 264 of the Act, but rather to the uniform assessment of units of assessment. According to appellant, the Act allows the assessor to enter on the roll simply a "proportion" of the actual value of units of assessment, but requires him to apply "the same proportion" to all units of assessment.
39. The trial judge did not decide this point, as he felt he should not substitute his opinion to the discretion of the assessor, especially since, in his view, the Superior Court was not the proper forum:
[TRANSLATION] The assessor told the Court that he considered the median proportion but, in his opinion, at the time he set the value of applicant's immovable for 1980, he thought the figure required was the actual value as provided in the Act respecting municipal taxation. Was this the right decision? The Court does not have to rule on the point.
It is true that the case at bar is not an action brought subject to a privative clause. It is also true that it is not a remedy based on art. 33 of the Code of Civil Procedure. However, in the case at bar as in the case of all prerogative writs, when an official exercises his discretion in accordance with established standards, limits, and in keeping with the law, it is not the function of the Superior Court to substitute its own decision and amend that of the official if it thinks the latter was not correct in the circumstances.
40. The Court of Appeal disposed of this aspect of the case in the following single paragraph, at p. 148:
[TRANSLATION] This paragraph provides for application of the median proportion, the implementation of which is explained in s. 264. This proportion is the median proportion of the actual real estate value of units of assessment (that is, a complete immovable) which corresponds to the values entered on the roll, that is, the entered value of all immovables must represent the same proportion of their respective actual values.
1. C.U.M. v. Dorchester Commerce Realty Ltd.
41. Respondent relied chiefly, and almost exclusively, on Communauté urbaine de Montréal v. Dorchester Commerce Realty Ltd., [1984] C.A. 426.
42. It is important to read this judgment in its context. Dorchester Commerce Realty Ltd. had filed a complaint with the B.R.E.F. against the value entered on the M.U.C. roll for its immovable in the city of Montréal for 1980. As was pointed out in the stated case, referred to by Monet J.A., at p. 427:
[TRANSLATION] The only problem presented by the appeals at bar can be summarized as follows: could the Bureau de révision legally, and did it have jurisdiction to, apply the "median proportion" fixed by the Minister of Municipal Affairs to the values deposited for the 1980 fiscal year and so reduce the values deposited?
and below (at p. 429):
[TRANSLATION] The parties disagree on the powers exercised by the Bureau in respect of the application of the median proportion to the assessment (taxable value) of the immovables at issue.
43. The Court of Appeal concluded that the B.R.E.F. had properly taken the median proportion into account in considering Dorchester's complaint. That conclusion is no longer disputed, as appears in appellant's following statement:
[TRANSLATION] 26. The new Act therefore had to provide a quick, easy and fair means of allowing the taxpayer, and of course the Bureau de révision, to arrive at this proportion: this (mathematical) means is known as the "median proportion". Admitting once again that despite all the assessor's efforts, the immovables entered on the roll are not all in the same proportion (any more than they were all at their actual value under the old system), the legislator for the sake of fairness adopted a middle‑of‑the‑road solution: the Bureau de révision will direct that the complaining taxpayer's immovable be entered on the roll not at the highest or the lowest proportion found, but at the middle proportion, the median (ss. 147 and 264). This new function of the Bureau de révision was recognized by the Court of Appeal in Dorchester Commerce Realty‑‑[1984] C.A. 426.
44. In the course of his opinion Monet J.A. appeared to approve this obiter of the B.R.E.F., which, dismissing the M.U.C.'s argument and accepting that of Dorchester, held that [TRANSLATION] "the `same proportion' of s. 42 is necessarily the `median proportion' of s. 264 and that the Bureau's duty is to apply the latter" (p. 432). Respondent relies on that statement.
45. It should be noted that the argument in that case turned on the interpretation of s. 147 as it stood at the time the case arose in 1980. At that time, the section provided that the B.R.E.F. should first set the actual value of the unit of assessment and second, apply "the rule provided in the second paragraph of section 42". The problem presented by this reference to s. 42 is readily apparent, especially in view of the word "proportion" in that section. In 1980 the B.R.E.F. in hearing a complaint, set the actual value of the immovable, the assessment of which was being challenged. In order to attain the objective of fiscal equity sought by the Act, the B.R.E.F. applied the median proportion to such value in order to bring that assessment to the level of the roll. It did so by interpreting the word "proportion" in s. 42 of the Act as meaning "median proportion". In Dorchester Commerce Realty, the Court of Appeal appeared to confirm this interpretation which was given some weight by the then wording of s. 147. The legislator has subsequently eliminated from s. 147 the reference to s. 42. It substituted a reference to s. 264, which refers to the median proportion, with the result that the ambiguity in the use of the word "proportion" in s. 42 was resolved.
46. To the extent that reference should be made to Dorchester Commerce Realty in interpreting s. 42 of the Act, one has to conclude that, read in its proper context, such obiter does not have the authority claimed by respondent.
2. Gorham v. C.U.M.
47. Respondent also cited Gorham v. Communauté urbaine de Montréal, J.E. 87‑116 (Sup. Ct.) Analysing ss. 42, 43 and 46 of the Act, Durand J. concluded that:
[TRANSLATION] The legislator has thus stated three principles:
(1) the entered value of an immovable is no longer necessarily its actual value;
(2) the latter is established by taking into account sales actually made during a given period; and
(3) for the most part these taxable values should be at more or less the same level compared to actual values.
However, if the assessor does not attain this level of perfection, the roll will not be quashed or set aside, as the Act provides that a taxpayer can then file a complaint with the B.R.E.F., as we will see below.
48. Then, relying on Dorchester Commerce Realty, supra, which he appeared to regard as binding on him, Durand J. states that [TRANSLATION] "this `same proportion of actual values' mentioned in s. 42 is the `median proportion' which we have referred to". Although these words seem to support respondent's point of view, the substance of the judgment is not to that effect. Durand J. did subsequently say that it seems clear the legislator intended this median to be mentioned on the roll for two reasons: to enable the taxpayer to determine whether the assessment of his immovable was reasonable and to allow the B.R.E.F. to adjust the assessment in accordance with this proportion. Discussing the transitional provisions, Durand J. explained his approach:
[TRANSLATION] In our view, and again with all due respect to the opposite opinion, it is mistaken reasoning to argue that the assessor should also apply this median to assessments he has already made and which he has used in calculating it. First, this is not mentioned in s. 264, and second it would be requiring him to redo work he has already done. Take, for example, the value of applicant's property entered on the roll for 1986. Before November 15, 1985 the assessor determined "its exchange value in the free and open market" (s. 43) on the date on which he assessed it "taking account of market conditions on 1 January" 1985 (s. 46), and he then checked the list of sales concluded between July 1, 1984 and June 30, 1985, made up a list of those which could be used in calculating the median (regulation r. 11.1., ss. 3 and 4), then divided the value he had entered on the roll for these properties by their selling price, and calculated an average [sic] of all the quotients thus obtained (r. 11.1, s. 1). It would be pointless to ask him to then revise all the entries on the roll to ensure that they are all at the median, for he would no longer be acting as an assessor, that is a person setting an approximate value of something, but would be passing judgment on his own estimate and would thus be taking over the function of the B.R.E.F. which is precisely to make that review.
In short, the undersigned considers that so far as the median is concerned the Act creates separate duties for each intervener and that one does not overlap the other:
(a) the assessor calculates it, sets it out and sends it to the Minister;
(b) the Minister approves and adopts it;
(c) the municipality enters it on the notice of assessment or the tax account; and
(d) the B.R.E.F. applies it without discussion to the value it has set for a unit of assessment.
As the assessor was not responsible for applying the median, he cannot be required by mandamus to do so.
49. That is exactly the position taken by appellant in this Court. I agree.
3. Interpretation
50. Neither the wording of ss. 42, 147 and 264, the logic of the provision and the context, nor the purpose of the Act support respondent's arguments. Section 42 of the Act does not contain the term "median proportion" of s. 264, but rather "the same proportion of the actual value". If the legislator intended here to refer to the "median proportion" he could easily have said so clearly, especially as this was a completely new concept which, then, was being mentioned for the first time in the Act some two hundred sections later (s. 264). It seems much more logical that, in the second paragraph of the same section, the legislator intended to refer to concepts he had developed in the first paragraph. The first paragraph of s. 42 states that an immovable will be entered on the roll "on the basis of its actual value". That value is necessarily expressed or indicated by a "proportion" of the actual value and it is this "proportion" which must be the same for all immovables. Read in this way s. 42 is complete in itself, integrates perfectly within the reform of municipal taxation intended to ensure fiscal equity and complies with the "mischief rule" of interpretation. The remedy intended by the adoption of s. 42 is to allow the assessor some flexibility in preparing the roll. Using as a basis the actual value defined by the Act, he can henceforth now legally set the value of immovables at a certain proportion of the actual value. The caveat contained in the second paragraph of s. 42 requires him to respect this proportion on all immovables assessed, hence the resulting fiscal equity.
51. Looking at the term "median proportion" in s. 264 of the Act and the Regulation in which it is defined, it can immediately be seen that the "same proportion" mentioned in s. 42 could not refer to the "median proportion" of s. 264. The assessor clearly cannot enter on the roll a proportion that he cannot possibly know until the roll has been prepared. He can no more calculate the median proportion at the time the roll is being prepared, since that median proportion is calculated, according to the Regulation set out above, from the value entered in the roll.
52. As appellant said in its submission:
[TRANSLATION] The median of a roll is not calculated until after the roll is prepared. This calculation is made on the basis of the values entered in the roll by the assessor. It would be senseless for him to redo the roll he has just prepared so as to reduce it to a proportion resulting from that process: otherwise the assessor would never prepare any roll, as when he had reduced it he would obtain a new median which he would again have to apply, and so on until the roll had vanished completely'<.
53. By its very definition, the median proportion is a proportion of the roll in its entirety and can only be determined once the roll has been prepared, using the roll itself as the basis of calculation. This is what Durand J. demonstrated in Gorham, supra. This interpretation is also entirely in keeping with s. 264 of the Act: as I have said, that section introduces the new concept of a "median proportion" and nowhere does it require the assessor to take it into account in preparing the roll. On the contrary, under that section the assessor must indicate the median proportion to which the entered values correspond. This necessarily implies an a posteriori, not an a priori. Additionally, this proportion can be determined by the Minister if the assessor fails to do so. No one would argue that the Minister has the power to prepare the roll or that the effect of the "median proportion" determined by the Minister would be to alter the values entered on the roll by the assessor. As I understand it, the median proportion is intended as a measure of the level of the roll; it is not a factor for correcting the roll. Its purpose is to give the taxpayer a means of checking whether the value entered on the roll corresponds to the actual value of his immovable once the comparative factor has been applied. If it does not, the taxpayer may file a complaint with the B.R.E.F. (s. 124), which once the actual value of the immovable in question has been determined will have to take the median proportion into account (s. 147).
54. As mentioned earlier, s. 147 was amended in 1983 to expressly refer to the concept of a median proportion. The Act to amend legislative provisions concerning municipalities, which amended s. 147, at the same time also amended s. 42 without inserting the word "median" after the word "proportion", a step the legislator could have taken if he had intended such a result. This appears to be in harmony with the intent of the legislator in adopting s. 42 of the Act. If the B.R.E.F. applies the median proportion to the assessment of an immovable, it is under s. 147 and not s. 42 of the Act, which is now clear since the amendment to s. 147.
55. Additionally, all that s. 264 requires of an assessor is that he indicate on the roll both the median proportion and the comparative factor resulting from it. Once these particulars appear on the real estate tax account, as I have just noted, the taxpayer can easily calculate the actual value of his immovable and decide whether or not to file a complaint with the B.R.E.F. That was the intention of the legislator in adopting ss. 147 and 264 of the Act, which is an innovation from the old Act in which the taxpayer had no means of checking the actual value of his immovable in relation to the value entered on the roll, and the B.R.E.F. had no way of taking into account the unequal treatment of one immovable as compared with another entered on the same roll, since the B.R.E.F. was only then required to determine the actual value of the immovable about which a complaint had been filed.
56. The Court of Appeal interpreted the transitional provision of s. 531 of the Act as requiring an assessor to take the "median proportion" into account in preparing the roll.
57. While it is true that under s. 531 of the Act "a roll must be amended" to "take account of the provisions of this [Act] that are applicable to it and that differ" from the Real Estate Assessment Act, the new Act must still create such a duty. In my opinion the Act does not require an assessor to take the "median proportion" into account in preparing the roll, but simply to indicate it on the roll, which was done here. The provisions that "are applicable to it and that differ" are contained in several sections of the Act. Section 174 of the Act, to which the second paragraph of s. 531 refers, mentions inter alia cases in which an amendment must be made to the roll. The Act also innovates in several ways: immovables entered on the roll are entered by units of assessment (s. 33), some immovables are no longer entered on the roll (ss. 63 et seq.), the roll must contain certain particulars (ss. 55 et seq.) and so on. Section 531 of the Act is directed at all these changes to ensure that rolls prepared under the old system will be in accordance with the new Act. Section 531 of the Act is concerned with the "median proportion" only to the extent that an assessor must indicate it in the roll with the comparative factor and forward this information to the Minister within the specified time (s. 264). Read in this way, s. 531 retains its full meaning.
Conclusion
58. Accordingly, I come to the conclusion that the M.U.C. assessor was not required under the Act to take the "median proportion" into account in preparing the M.U.C. real estate assessment roll for 1980. As he did not fail or decline to comply with the Act in respect of the value entered on the M.U.C. roll for 1980 for the Nortel immovable in the city of Lachine, the writ of mandamus cannot issue.
59. It is still possible, and I express no opinion on this point, that the real estate value of the Nortel immovable as entered on the M.U.C. roll for 1980 does not represent its actual value taking into account the comparative factor shown on the tax account. If that is so, Nortel had the opportunity to file a complaint with the B.R.E.F. as it did the previous year and did in subsequent years. The fact that it failed to do so in due course does not render admissible the remedy here sought.
60. In view of this conclusion, there is no need to discuss the other arguments submitted.
61. For these reasons, I would allow the appeal, reverse the judgment a quo and dismiss the application for mandamus, the whole with costs throughout.
Appeal allowed with costs.
Solicitors for the appellants: Beaupré, Trudeau, Montréal.
Solicitors for the respondent: Pâquet, Galardo & Nantais, Montréal.
Solicitors for the mis en cause the city of Lachine: Viau, Hébert, Denault, Montréal.
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