Taylor,
T.CJ.:—These
are
appeals
(a
total
of
10
in
number)
heard
on
common
evidence
in
Calgary,
Alberta,
on
September
3
and
4
and
on
November
17
and
18,
1987,
against
income
tax
assessments
for
the
years
1978
and
1979
for
the
Estate
of
Sadie
Armor,
and
for
the
years
1979
and
1980
for
the
balance
of
the
individuals
concerned.
In
general
terms
the
first
two
days
of
the
hearing
were
taken
up
by
evidence
and
testimony
on
behalf
of
the
appellants
and
the
second
two
days
by
the
presentation
of
the
respondent,
the
rebuttal
evidence
from
the
appellants,
and
argument
by
the
parties.
The
basic
issue
in
itself
is
a
simple
one
—
V-Day
value
of
some
parcels
of
real
estate
in
the
Calgary
area,
certainly
one
on
which
there
is
an
ample
supply
of
income
tax
case
law.
Using
portions
of
the
appeal
for
Alfred
Zimmer
for
the
taxation
year
1980
as
indicative
for
general
purposes
of
all
of
the
appeals,
and
the
Minister's
reply
thereto,
the
conflict
between
the
parties
can
be
set
out,
even
though
details
with
respect
to
each
year
under
appeal
may
differ:
From
the
notice
of
appeal
—
Valuation
Day
valuation
as
established
by
the
Real
Estate
Section
of
Department
of
National
Revenue
is
unrealistic
and
is
not
supported
by
comparable
valuation
data.
—
Appellant
submitted
formal
appraisal
report
to
D.N.R.
to
substantiate
V-Day
value
of
$15,000.00
per
acre
for
City
land
and
$8,000.00
per
acre
for
land
located
outside
City
boundary
and
which
Appraisal
Report
relates
to
comparable
valuation
data.
Reply
to
notice
of
appeal
—
He
(The
Respondent)
admits
that
the
Appellant
has
submitted
a
formal
appraisal
report
with
values
of
$15,000
per
acre
for
city
land
and
$8,000
per
acre
for
non
city
land.
—
In
computing
the
income
for
the
1980
taxation
year,
the
Appellant
reported
the
disposition
of
property
on
the
basis
that
its
fair
market
value
on
valuation
day
was
$8,000
an
acre.
—
The
Respondent
reassessed
the
Appellant
for
the
1980
taxation
year
on
the
basis
that
the
fair
market
value
of
the
property
on
valuation
day
was
$3,500
an
acre.
—
On
31
December
1971,
the
Appellant
and
four
brothers
and
sisters
(the
"group")
owned,
in
five
equal
shares,
land
located
in
the
NW
1/4
27-24-2-W5
which
was
zoned
as
agricultural
property.
—
On
April
1980,
the
group
sold
to
The
Beca
Corporation
Ltd.
a
1.54
acre
parcel
for
$23,100
and
a
112.04
acre
parcel
for
$1,680,600.
The
two
parcels
were
part
of
the
land
referred
to
in
paragraph
5(a).
During
the
trial,
there
were
numerous
questions
raised
regarding
procedure,
matters
of
points
of
order,
and
in
particular
motions
dealing
with
admissibility
of
certain
documentation
or
testimony.
Some
of
the
time
delays
which
arose
in
the
hearing
of
these
appeals
may
be
attributable
to
this
Court's
efforts
to
be
as
informal
and
flexible
as
possible
in
giving
to
the
appellants
full
opportunity
for
presentation,
while
at
the
same
time
acknowledging
the
accepted
rules
of
court
procedure
in
such
matters,
as
they
have
been
used
and
demonstrated
in
this
Court.
It
is
understood
that
to
this
point
in
time,
this
Court
has
not
yet
adopted
a
specific
and
comprehensive
set
of
rules.
In
this
context,
the
Court
would
like
to
review
the
fundamental
submission
(made
at
the
close
of
the
case)
by
counsel
for
the
appellants:
(A)
.
.
.
it's
my
contention,
sir,
that
we
filed
the
returns,
we
provided
supporting
appraisals
with
it,
and
the
Department,
through
some
means
or
other,
has
elected
to
not
accept
our
figures
and
have
utilized
these
other
figures
to
which
I
have
just
referred.
I
have
been
bothered
over
the
process
of
the
hearing,
as
I
think,
as
I
have
reiterated
earlier,
—
what
is
it
that
I
am
supposed
to
be
meeting
here?
The
issue
here
is
not
the
matter
as
to
which
appraisal
is
right
or
is
wrong.
The
issue
before
the
Court
is
the
V-Day
value
as
it
relates
to
the
tax
return.
So,
it's
a
matter
involving
the
Tax
Department,
as
opposed
to
their
appraisers.
The
Tax
Department,
in
their
wisdom,
has
come
up
with
some
figures,
and
it’s
my
contention,
sir,
that
evidence
has
got
to
be
led
to
support
those
figures.
We
are
in
a
Court
of
Law.
We
have
taxpayers
who
have
filed
their
returns,
have
supported
them
with
an
appraisal.
We
know
what
those
figures
are.
We
have
brought
evidence
before
the
Court
to
support
those
figures
and
I
suggest
to
you,
sir,
that
there's
no
evidence
before
the
Court
to
support
the
Department's
figures.
They
have
figures
out
there,
but
the
appraisers
who
gave
evidence
here
did
not
prepare
their
reports
for
the
purpose
of
the
reassessment,
and
I
raise
that
as
a
very
serious
question
because
we
are
now
in
a
Court
of
Law
as
opposed
to
a
Tax
Review
Board,
and
I
suggest
to
you,
sir,
that
the
taxpayer
has
the
right
to
be
able
to
meet
the
case
that's
before
the
Court
and
I've
had
considerable
difficulty
in
attempting
to
determine
what
that
is,
and
that
is,
am
I
trying
to
lead
evidence
to
limit
or
speak
against
the
valuations
of
the
Department,
or
am
I
trying
to
lead
evidence,
or
in
one
way
or
the
other,
direct
our
cross-
examination
to
deal
with
the
appraisal
evidence.
We
have
the
evidence
of
Mr.
Schmitt
and
we
have
the
evidence
of
Mr.
Stevenson
and
their
appraisal
values
for
the
particular
lands
in
question
are
not
relative
to
the
figures
which
are
being
utilized
and
somebody
might
say
to
me,
well,
Mr.
Maxwell,
that's
the
way
it
is.
That's
the
way
it
works.
And
I
say,
what
do
you
mean
that's
the
way
it
works?
We
are
in
a
Court
of
Law
and
I
suggest,
sir,
that
it
was
incumbent
upon
the
Department
to
lead
evidence
to
support
how
they
arrived
at
these
reassessments.
We
had
to
file
the
returns,
we
have
filed
the
returns,
they
have
assessed
them
—
reassessed
them
in
their
capacity,
and
said
we
have
to
pay
a
different
amount
of
tax
by
virtue
of
their
reassessment.
But,
what
is
here
in
support
of
that?
And
I
say
that
there
is
nothing
before
you
which,
in
a
Court
of
Law,
that
our
clients,
as
taxpayers,
can
get
to
those
particular
figures
because
I
suppose
that
if
you
don't
accept
our
arguments,
then
it
would
mean
that
you
are
sustaining
the
$5,000
and
$3,500
amounts,
but
what
is
before
you
to
sustain
those
amounts?
You
don't
know
how
they
arrived
at
them.
And,
so,
sir,
I
ask
that
weight
be
placed
on
that
because
we
are
in
a
Court
of
Law.
To
me,
it's
a
denial
of
natural
justice
to
have
the
taxpayers
brought
before
the
Court.
We've
heard
that
there's
been
a
number
of
appraisal
reports
prepared
and
what
is
it
that
they
are
supposed
to
meet,
and
I
think
that's
a
very
serious
question.
.
.
.
I've
heard
your
comments
on
the
basis
that
we
must
sustain
the
$8,000,
$9,000
and
$15,000.
We
haven't
brought
in
any
evidence
of
comparables,
of
those
dollar
amounts,
but
as
Mr.
Rollheiser*
has
said,
that
there
are
no
exact
comparables,
.
.
.
(B)
Now,
the
emphasis
of
the
Appellant,
sir,
is
on
the
basis
that
the
highest
and
best
use
of
the
land
was
for
some
purpose
other
than
the
agricultural
use
that
was
ascribed
to
it.
The
highest
and
best
use,
and
you
don't
need
me
to
repeat
it
again,
but
I
think
that
the
definition
referred
to
in
Mr.
Stevenson's
report
is
that
it
is
that
legal
use
which
will
yield
to
the
land
the
highest
present
value
sometimes
called
optimum
use.
The
use
must
be
probable,
the
use
must
be
such
as
to
return
to
the
land
the
highest
net
return.
The
use
must
be
such
as
to
deliver
the
return
for
the
longest
period
of
time,
and
this
is
where
I
place
great
emphasis
on
the
fact
that
we
have
this
land
to
which
our
appraiser
has
ascribed
a
potential
commercial
development
prospect
to
it,
and
I
say
that
the
attributes
of
the
land
afford
the
Appellants
these
valuations.
I
suggest
to
you,
sir,
that
the
lands,
by
their
nature,
by
their
location,
are
ascribed
with
a
commercial
potential.
That,
as
I
stated
in
cross-examination,
and
that
if
our
client
stood
on
their
lands
in
1971,
and
this
is
what
we're
really
saying
here,
we're
standing
on
the
lands
and
we're
saying,
the
Armors
and
Zimmers
are
saying
this
has
potential
commercial
and
mixed
development.
The
Minister
is
standing
on
the
land
and
he
says,
no,
you're
wrong.
Now,
if
they
were
doing
that
in
1971
I
suppose
it
would
be
pure
conjecture
and
so
therefore
the
Minister
can
say,
no,
there's
been
no
development
out
here,
and
Mr.
Zimmer,
and
Mrs.
Armor,
I
believe
you're
wrong.
But
because
of
circumstances,
we
are
here
now
some
16
years
later
and
we
have
had
the
benefit
of
what
has
happened
since.
And
as
Mr.
Carroll
has
said,
that
you
must
consider
history.
The
highest
and
best
use
says
it
mustn't
be
conjectural,
but
I'm
saying
to
you,
sir,
that
the
appraisers
for
Revenue
Canada
are
being
conjectural
because
what
they're
saying
is
that
you
must
close
your
eyes
and
you
can't
say
today
that
in
1971
that
this
would
have
happened,
as
it
did
happen,
and
that
we
know,
as
I
stated
earlier,
the
single
fact
that
we
know
is
that
the
lands
were
sold
for
those
figures
which
are
referred
to
in
the
Reply
of
the
Minister
and
referred
to
in
the
appraisal
report
of
Mr.
Stevenson.
Very
substantial
figures.
So,
the
question
is,
how
do
we
determine
what
the
value
was
in
1971,
and
as
I
said,
alluded
to
earlier,
that
they
do
have
the
benefit
of
knowing
that
the
position
of
the
taxpayer
who
says,
by
virtue
of
my
appraisal,
I
ascribe
some
commercial,
some
greater
development
potential
than
just
straight
agriculture.
I
mean,
it
did
prove
to
be
correct.
The
conjecture
is
to
say,
oh,
no,
that's
pure
conjecture.
I
don't
want
to
know
what
happened
to
it.
But,
in
these
circumstances,
we
do
know
what
happened
to
it
and
it
isn't
the
case
of
the
farmer
who
is
six
miles
from
Calgary
and
says,
in
1971,
well,
you
know,
the
city
is
really
growing
and
!
think
the
city
is
going
to
be
out
here
very
soon
and
so
therefore,
Mr.
Minister,
I
want
to
ascribe
to
my
land
a
certain
commercial
development
potential,
and
that
isn't
relevant.
So,
what
is
the
land
going
to
be
used
for?
The
Department
wants
the
taxpayer
to
accept
the
proposition
that
it
really
didn't
have
any
potential
for
a
use
other
than
agriculture,
or
maybe
some
commercial
but
we're
not
going
to
give
too
much
credence
to
that.
As
I
have
indicated,
and
as
I
trust
the
above
quotations
demonstrate,
there
was
some
degree
of
doubt
raised
by
the
appellants
regarding
—
in
effect
—
the
onus
or
responsibility
for
carriage
of
this
matter,
and
in
particular
the
degree
of
"proof
of
position”
to
be
attributed
to
the
respondent
under
these
circumstances.
It
seemed
to
be
the
basic
contention
of
the
appellants
(see
above)
that
having
filed
an
income
tax
return,
and
provided
an
appraisal
report
in
support
of
the
valuations
used
therein,
that
the
appellants’
responsibilities
were
thereby
discharged,
and
variations
from
or
changes
to
these
submitted
figures
made
by
the
Minister
required
that
such
adjustments
be
substantiated
by
the
Minister.
It
may
well
be
that
the
progress
of
time
will
bring
about
some
movement
in
that
direction,
but
it
is
my
understanding
that
is
not
the
state
of
the
law
at
the
moment.
As
matters
stand
now,
the
primary
responsibility
with
regard
to
overturning
an
assessment
of
income
tax
rests
with
the
taxpayer,
as
much
in
a
"valuation"
case
as
in
any
other
kind
of
case.
It
is
an
old
adage
that
the
original
submissions
of
the
information
upon
which
a
taxpayer
has
self-assessed
himself,
is
within
the
knowledge
and
capacity
of
that
taxpayer,
not
the
Minister.
One
cannot
quarrel
with
the
assertion
implicit
in
the
argument
of
counsel
for
the
appellants
(see
above)
that
the
Minister
should
normally
and
regularly
accept
the
filing
and
the
supporting
evidence
as
sufficient.
But
normally
and
regularly
does
not
include
a
situation
where
in
the
Minister
has
valid
reasons
to
question
the
submissions
and
even
prepare
a
different
taxation
result
—
which
is
the
effect
of
an
assessment
or
more
likely
a
reassessment.
When
the
taxpayer
challenges
the
Minister’s
reassessment,
it
is
then
up
to
that
taxpayer
to
examine
and
review
the
basis
of
his
original
submissions
and
to
be
prepared
if
called
upon
to
do
so
as
Mr.
Maxwell
puts
it
in
a
"Court
of
Law"
to
prove
the
validity
of
his
submissions.
In
my
view
if
no
reasonable
case
is
made
by
the
appellant
during
such
proof,
to
substantiate
the
valuations
provided,
then
the
purpose
to
be
served
by
the
Minister
presenting
documented
evidence
and
testimony
in
support
of
the
assessment
is
at
the
least
questionable.
But
that
is
a
procedural
point
to
be
determined
by
counsel
for
the
Minister.
In
reference
to
this
perspective
I
would
quote
from
Silver
Rapids
Holdings
Ltd.
v.
M.N.R.,
[1987]
2
C.T.C.
2065
at
2066;
87
D.T.C.
413
at
414:
I
do
agree
with
the
judgment
in
Dubbel
Wear
Holdings
Ltd.
v.
M.N.R.,
[1981]
C.T.C.
2348;
81
D.T.C.
351,
wherein
on
page
2350
(D.T.C.
353)
it
states:
The
onus
in
an
appeal
such
as
this
is
on
the
Appellant.
It
is
not
enough
for
the
Appellant
simply
to
attempt
to
cast
doubt
on
the
value
used
on
assessment.
In
order
to
succeed
the
Appellant
must
affirmatively
establish,
on
the
balance
of
probabilities,
that
the
value
used
by
the
Minister
is
too
low
and
he
must
show,
with
some
degree
of
accuracy,
by
how
much.
Similar
sentiments
were
expressed
in
Eric
W.
Levis
v.
M.N.R.,
[1983]
2122
at
2124;
83
D.T.C.
104
at
105:
.
.
.
As
I
see
it,
the
appellant
has
failed
to
establish
even
a
prima
facie
case
for
the
valuation
he
used
in
filing
his
tax
return
for
the
year
of
$375,000,
and
certainly
not
for
the
$416,000
estimate
suggested
by
his
appraiser,
or
any
figure
remotely
approaching
either
one
of
them.
In
this
matter,
while
the
appellant's
appraisal
report
was
insufficient
in
itself
to
fulfill
the
appellant's
responsibilities
(see
later),
when
taken
in
the
context
of
the
testimony
of
Mr.
Charles
Stanley
Reid,
president
of
the
Corporation,
there
were
good
reasons
advanced
to
look
carefully
at
the
appellant's
contentions.
As
I
see
it,
that
disposes
of
the
main
argument
of
Mr.
Maxwell,
point
"A"
from
the
quotations
of
the
argument
(see
above),
and
leaves
to
the
Court
the
determination
whether
that
presented
as
"proof"
on
behalf
of
the
appellants
did
in
fact
substantiate
the
valuations
prepared
by
the
appellants,
or
at
least
that
there
were
"good
reasons
advanced
to
look
carefully
at
the
appellant's
contention"
(See
Silver
Rapids
Holdings
Ltd.,
supra).
I
shall
return
to
that
point
at
a
later
time
in
this
decision.
The
second
proposition
—
Point
"B",
put
forward
in
argument
by
Mr.
Maxwell
is
that
the
lands
in
question
“are
ascribed
with
a
commercial
potential,
supra.
This
argument
is
best
understood
from
the
perspective,
according
to
Mr.
Maxwell,
that
in
1971
the
then
owners
(now
the
appellants)
could
foresee
substantial,
in
fact
considerable
development
potential
for
their
lands,
and
regarded
the
lands
(in
1971)
as
worth
several
millions
of
dollars.
That
argument,
or
species
of
argument
has
been
raised
in
many
circumstances
before
—
in
effect,
it
says
—
"who
should
know
better
than
the
owner
what
potential
the
land
holds?”.
The
fallacy
in
the
argument
is
self
evident
—
and
it
is
the
basic
reason
for
appraisers
and
appraisal
reports
as
a
main
part
of
the
evidence
required
by
this
Court.
There
must
be
demonstrable
proof
that
outside
parties
—
third
parties
—
also
held
a
similar
opinion
of
the
value
of
the
land,
and
that
there
was
interest,
indeed
possibly
prospective
purchasers
at
the
valuations
contended.
That
a
landowner
—
particularly
one
whose
interest,
and
family
interest,
extended
back
many
decades,
should
take
a
certain
satisfaction
from
looking
at
the
lights
of
Calgary
gradually
approaching
(over
the
years)
nearer
to
his
ranch
land
is
not
surprising.
That
"owner
perspective"
must
only
be
taken
though
with
full
regard
for
the
fact
that
there
probably
were
competing
tracks
of
land
in
similar,
if
not
identical
"potential
development"
situations.
Mr.
Maxwell
would
like
the
Court
to
ignore
the
fact
that
little
or
no
real
development
has
occurred
on
the
subject
lands
since
1971,
but
that
proposition
falls
of
its
own
weight.
He
is
proposing
in
effect
that
the
Court
accept
(as
the
main
or
even
sole
proof)
the
visions
of
development
held
by
the
owners
in
1971,
while
rejecting
the
facts
which
arise
out
of
the
subsequent
actual
events.
That
is
not
to
say,
that
the
optimistic
view
of
value
held
by
any
owner
should
be
ignored
by
the
Court,
and
indeed
it
should
be
(if
presented)
listened
to
with
care
and
caution.
But
to
propose
that
this
should
be
the
main
—
perhaps
sole
—
criterion,
upon
which
a
critical
income
tax
assessment
should
be
based
does
not
appear
to
me
to
be
sound
reasoning.
That
leaves
up
to
the
appraisers
presented
by
the
appellants
(or
some
other
equally
acceptable
proof)
to
take
such
a
“potential
development"
realistically
into
account
when
presenting
evidence.
Before
returning
to
the
specifics
of
the
instant
case,
I
would
like
to
add
a
few
comments
regarding
the
"exclusion
of
witnesses"
and
the
“calling
of
rebuttal
evidence"
—
both
matters
which
arose
as
further
points
of
some
contention
in
this
trial.
At
the
commencement
of
proceedings
counsel
for
both
parties
agreed
that
"witnesses"
should
be
excluded
—
an
agreement
to
which
the
Court
obviously
had
no
objection.
The
taxpayers
who
were
present
themselves,
were
not
excluded
from
the
proceedings
—
neither
party
raised
the
point,
and
although
it
was
not
known
at
the
outset,
none
of
the
taxpayers
involved
gave
evidence.
Both
parties
however,
did
request
that
one
of
their
own
experts
(appraisers)
in
each
case
be
permitted
to
remain
in
the
courtroom
during
the
proceedings
—
and
the
Court
was
informed
that
each
one
would
very
likely
be
called
as
an
expert
witness
—
to
give
opinion
evidence;
the
respondent's
witness
(a
Mr.
Schmitt)
to
be
one
of
the
main
witnesses
for
the
Minister,
after
having
heard
the
witnesses
and
testimony
already
presented
on
behalf
of
the
appellants;
and
the
appellants’
final
witness
(a
Mr.
Carroll),
who
would
give
"rebuttal"
evidence
—
in
his
case
after
hearing
all
the
appellants
previous
testimony,
and
that
of
Mr.
Schmitt.
The
prospects
for
conflict
were
highlighted
by
each
party,
but
to
their
credit,
both
counsel
agreed
to
the
proceedings
in
that
manner.
While
appreciated
by
the
Court,
that
agreement
did
little
to
lessen,
in
my
mind,
the
question
of
standard
appropriate
procedure.
As
I
noted
earlier,
the
development
of
"rules"
for
the
conduct
of
this
relatively
new
and
“informal”
Court
are
proceeding,
and
given
that
set
of
circumstances,
this
Court
generally
provides
considerable
latitude
in
presentation
to
an
appellant
—
in
order
to
meet
the
onus
of
proof
referenced
earlier,
and
this
was
provided
in
this
matter.
It
would
be
imprudent,
perhaps
impudent
of
me
to
review
this
critical
and
well-examined
subject
of
"witnesses"
in
too
much
detail,
and
I
therefore
restrict
my
remarks
to
a
recognition
that
under
a
given
set
of
circumstances,
there
could
easily
be
something
less
than
total
agreement
between
(or
among)
the
parties
to
an
income
tax
dispute
regarding
"exclusion
of
witnesses",
and/or
of
"witnesses"
themselves.
In
that
connection
I
would
refer
to
the
following:
Exclusion
of
Witnesses
—
Carswell,
Toronto,
(1982)
Report
of
the
Federal/Provincial
Task
Force
on
Uniform
Rules
of
Evidence
—
Chapter
22
at
277.
J.
Sopinka
&
S.N.
Lederman
—
The
Law
of
Evidence
in
Civil
Cases
(Toronto:
Butterworths
1974
at
461.)
Tomlinson
v.
Tomlinson
—
[1980]
1
ALL
ER
593
Finally,
to
return
to
the
specifics
of
these
appeals,
the
basic
facts
are:
For
the
Estate
of
Sadie
Armor:
(1)
The
taxpayer
had
owned
the
property
in
question
for
many
years
before
December
31,
1971
(V-Day).
(2)
The
property
consisted
of
approximately
112
acres
described
by
the
respondent
in
the
reply
to
notice
of
appeal
as
"adjacent
to
Calgary”.
(3)
The
gross
proceeds
of
disposition
in
1978
amounted
to
$1,790,000
—
(about
$16,000
per
acre).
(4)
The
V-Day
value
used
by
the
appellant
was
$1,008,000
—
($9,000
per
acre
—
for
112
acres).
(5)
The
V-Day
value
used
by
the
respondent
was
$560,000
—
($5,000
per
acre).
(6)
Use
of
the
"reserve"
clauses
of
the
Income
Tax
Act
placed
some
of
the
gains
in
1978
and
some
in
1979.
For
Alfred
Zimmer
(representative
of
"the
group”)
—
(see
below):
(1)
The
property
in
question
had
been
owned
for
many
years
before
December
31,
1971
(V-Day)
by
"the
group”
which
consisted
of
Alfred
Zimmer,
four
brothers
and
sisters
—
all
appellants.
(2)
The
property
consisted
of
a
parcel
variously
described
in
the
documents
and
appraisal
reports
as
some
127
acres
more
or
less,
zoned
as
“agricultural
property"
and
"adjacent
to
the
Calgary
city
limits”.
(3)
In
1979
a
parcel
of
some
13.5
acres
inside
"the
city
limits"
was
sold
for
$540,000
or
about
$40,000
per
acre.
(4)
In
1980,
a
parcel
of
1.54
acres
was
sold
for
$23,100
and
the
balance
(112.04
acres)
for
$1,680,000
—
about
$15,000
per
acre.
(See
Note
below).
(5)
The
V-Day
values
ascribed
to
the
property
by
the
appellants
were
$8,000
per
acre
for
rural
land
and
$15,000
per
acre
for
the
city
land.
(6)
The
V-Day
values
used
by
the
respondent
weres
$3,500
per
acre
for
the
rural
land
and
$5,000
per
acre
for
the
city
land.
As
a
matter
of
further
general
description,
the
Court
notes
that
the
two
parcels
("Armor"
and
"Zimmer")
were
contiguous
parcels
with
one
side
of
each
bordering
the
Trans-Canada
Highway
along
the
western
edge
of
the
City
of
Calgary.
In
a
very
rudimentary
way,
the
parcels
contained
some
aspects
of
an
original
land
grant,
represented
by
1/4
section
(160
acres)
in
each
case,
portions
of
which
had
been
sold
off
or
deeded
to
other
parties
over
the
years.
The
portion
of
the
City
of
Calgary
which
bordered
the
side
of
the
Trans-Canada
Highway
across
from
the
subject
properties
was
in
the
main
the
furthest
west
that
Calgary
had
developed
by
1971.
That
part
of
the
area
—
in
the
City
of
Calgary
on
the
opposite
side
of
the
Trans-Canada
Highway
(locally
described
as
North
of
the
Trans-Canada
Highway),
has
developed
considerably
more
since
1971,
but
the
area
on
the
subject
side
of
the
Trans-Canada
Highway
(locally
described
as
South
of
the
Trans-Canada
Highway)
remains
not
dramatically
different
from
its
utilization
and
configuration
in
1971
—
that
is
certainly
true
of
the
subject
properties
at
least.
And
so
it
falls
to
the
appraisal
reports
for
the
appellants,
presented
by
Mr.
Rollheiser,
who
was
accepted
by
the
Court
as
an
expert
witness,
to
support
the
appellants'
contentions.
I
would
agree
that
in
his
summation
of
the
evidence
Mr.
Maxwell,
counsel
for
the
appellants,
put
the
best
possible
spin
on
the
testimony
of
Mr.
Rollheiser:
.
.
.
We
haven't
brought
in
any
evidence
of
comparables,
of
those
dollar
amounts,
but
as
Mr.
Rollheiser
has
said,
that
there
are
no
exact
comparables,
and
I
believe
that
this
is
supported
by
what
Mr.
Schmitt
says,
and
what
Mr.
Stevenson
says,
that
there
are
just
no
exact
comparables,
and
there's
a
comment
which
I'll
read
out
of
a
case
later
which
says
that,
you
know,
that
would
be
utopian
to
have
that,
but
we're
not
—
we're
very
seldom
afforded
that
opportunity.
What
we're
dealing
with
is
trying
to
utilize
the
best
comparables
we
have
and
allowing
adjustments
for
the
positive
and
negative
features
of
those
particular
properties.
In
saying
this
I
do
not
ignore
the
expert
testimony
of
Mr.
Carroll,
but
it
was
submitted
as
“rebuttal
evidence"
—
that
is
in
rebuttal
to
that
of
the
Minister's
appraisers
—
Mr.
Schmitt
and
Mr.
Stevenson.
Properly,
there
was
no
suggestion
by
Mr.
Maxwell
that
it
was
to
be
regarded
as
evidence-in-chief.
Nor
do
I
ignore
the
testimony
of
a
Mr.
Dewit
—
a
gentleman
called
by
the
respondent,
but
whose
evidence
did
little
to
support
the
Minister's
case.
But
I
shall
comment
later
on
regarding
Mr.
Dewit.
Simply
put,
there
were
numerous
examples
brought
out
under
cross-examination,
of
inconclusive,
indeed
contradictory
information
in
the
testimony
and
reports
of
Mr.
Roll-
heiser,
which
information
would
have
had
the
effect
of
casting
serious
doubt
on
any
mathematically
calculated
result
determined
from
the
comparables
used.
The
positive
attributes
from
the
reports
were
that
the
reports
were
prepared
in
the
1978-1979
period
directly
related
to
the
sale
of
the
subject
lands,
and
that
Mr.
Rollheiser
himself
appeared
to
be
intimately
knowledgeable
of
the
subject
properties
as
well
as
several
of
the
surrounding
properties,
even
some
of
those
he
referred
to
as
comparables.
For
these
reasons
the
Court,
and
it
should
be
said
counsel
for
the
Minister,
accorded
Mr.
Rollheiser
considerable
latitude
in
presenting
his
information.
The
negative
factor
is
that
Mr.
Rollheiser’s
methodology
in
arriving
at
his
vital
number
of
$15,000
per
acre
“city
land”,
and
$8,000
per
acre
“rural
land"
for
Zimmer,
and
$9,000
per
acre
for
Armor
(all
rural)
leaves
much
to
be
desired.
Only
the
most
tenuous
relationship
has
been
demonstrated
between
the
subject
lands
in
1971,
and
any
of
the
properties
listed
by
Mr.
Rollheiser
as
comparables
—
one
or
two
have
the
size
but
not
the
location,
others
a
reasonable
location,
but
not
the
size,
still
others
with
better
access
and
surrounding
development.
Perhaps
Mr.
Rollheiser
did
the
best
he
could
do
under
the
circumstances
in
1978
or
1979
reviewing
a
1971
situation,
since
he
found
no
close
"comparables".
Mr.
Rollheiser’s
failure
even
against
such
odds,
is
that
he
did
not
make
any
logical,
reasonable,
and
traceable
pathway
or
pattern
between
his
"comparables"
and
the
results.
My
summation
of
his
testimony
and
evidence
is
that
he
decided
in
1978
that
the
subject
properties
must
have
been
very
valuable
(probably
unique)
in
1971,
and
he
rationalized
(in
1978)
that
the
properties
had
"highway
industrial"
potential,
whatever
that
is
or
can
be
construed
to
be.
I
cannot
accept
any
claim
that
he
would
have
held
that
same
opinion
in
1971
as
a
professional
appraiser
if
he
had
done
the
work
in
that
year.
I
am
satisfied
that
an
individual,
certainly
an
owner
of
property
looking
at
the
awakening
of
development
in
the
1960's
and
early
1970's
in
Calgary
might
well
have
dreamed
of
expansion
reaching
out
into
the
ranch
country
in
the
future.
The
recent
building
and
opening
of
the
Trans-Canada
Highway
certainly
added
fuel
to
such
thoughts.
But
it
is
not
my
opinion
that
a
professional
appraiser
should
permit
his
personal
view
of
the
future
to
cloud
his
vision
to
such
a
degree
that
it
becomes
the
basis
for
his
own
report.
Mr.
Rollheiser
did
not
assert
that
the
primary
destiny
of
the
subject
properties
(in
1971)
was
for
residential
(even
acreage
size
lots),
but
rather
the
"highway
industrial”
perspective
gained
his
approval.
As
I
see
it,
even
in
1987,
certainly
in
1978,
and
most
definitely
in
1971,
to
consider
or
have
considered
the
prospect
of
some
kind
of
industrial
development,
in
the
immediately
foreseeable
future,
virtually
over
the
entire
220
or
240
acres
of
land
involved
would
be
totally
unsupportable.
But
that
is
precisely
what
was
done
by
Mr.
Rollheiser.
There
were
certain
patches
of
industrial
and
commercial
development
in
1971
mainly
along
or
adjacent
to
the
Trans-Canada
Highway
and
in
the
vicinity
of
the
subject
properties.
I
might
have
been
persuaded
that
there
was
some
limited
logic
in
a
proposition
that
envisaged
strip
development
near
the
Trans-Canada
Highway
on
that
side
bordering
the
TransCanada
Highway
—
but
such
a
proposition
(attributing
industrial
or
commercial
growth
to
a
small
part
of
the
subject
property
only)
was
not
put
forward
by
the
appellants.
The
land
in
question
was
and
is
rural
and
suitable
for
limited
purposes
associated
therewith.
It
was
adjacent
to
the
City
of
Calgary
during
the
times
relevant
to
these
appeals,
and
the
evidence
was
that
in
1985
the
subject
lands
were
actually
annexed
to
the
City
of
Calgary.
There
was
no
evidence
brought
out
to
indicate
development
activity
of
substance
related
to
that
1985
annexation,
even
subsequent
to
it
or
dependent
on
it.
If
one
were
doing
a
valuation
of
the
subject
lands
in
1985
and
taking
into
account
reasonably
anticipated
future
development,
some
modest
part
of
Mr.
Rollheiser’s
propositions
made
for
the
year
1971,
might
be
in
order,
but
that
is
not
our
problem.
Although
great
emphasis
was
placed
on
it
—
from
directly
opposite
perspectives
—
by
both
counsel,
I
would
mention
only
in
passing
the
sale
in
1972
of
a
small
corner
(about
15
acres)
of
what
had
originally
been
the
Armor
land
from
a
Mr.
Smart
to
a
Mr.
Dewit
for
$80,000
—
which
included
a
house
and
some
other
improvements.
The
15
acres
had
been
sold
by
Armor
to
Smart
before
1971
and
was
used
as
a
residence,
then
resold
to
Dewit
for
his
own
use
as
a
residence,
as
well
as
using
it
as
a
small
plant
nursery.
This
triangular-shaped
piece
of
property
was
directly
adjacent
to
a
connection
in
the
traffic
circle
part
of
the
Trans-Canada
Highway.
Many
of
the
major
area
highway
developments
came
after
purchase
by
Smart
from
Armor
and
even
after
purchase
by
Dewit
from
Smart.
Many
efforts
were
made
by
counsel
(particularly
Mr.
Maxwell)
to
read
into
the
"per
acre
price"
of
the
Dewit
land
some
support
for
the
appraisal
numbers
per
acre
arising
out
of
the
Roll-
heiser
reports.
Since
Mr.
Dewit
eventually
sold
all
his
property
(the
same
15
acres)
for
a
very
substantial
sum
of
money
(in
excess
of
$1
million),
I
understand
why
the
appellants
in
this
matter
would
like
to
make
some
association
between
the
sale
in
1972
to
Dewit
and
the
value
of
their
lands
in
1971.
But
I
fail
to
see
any
—
the
testimony,
both
from
the
appraisers
and
Mr.
Dewit
supports
only
one
conclusion
—
that
at
the
time
of
sale
to
Smart,
this
tiny
corner
was
the
most
attractive
of
all
the
subject
property
(geographically,
environmentally,
physically,
etc.)
for
the
particular
residential
purposes
of
Mr.
Smart
—
and
that
continued
(with
some
added
individual
requirements)
for
Mr.
Dewit.
To
ascribe
to
the
balance
of
the
subject
property
—
rugged
and
almost
inaccessible
in
a
major
way,
except
for
a
relatively
small
portion
near
the
Trans-Canada
Highway,
characteristics
and
residential
attractiveness
similar
to
the
Dewit
property
does
not
appear
at
all
reasonable
to
me.
In
rejecting
the
Rollheiser
appraisals,
I
would
simply
quote
from
one
of
his
own
explanations:
Q.
What
is
the
significance
of
those
properties
to
which
you
refer
as
comparables?
A.
Well,
I
started
off
with
a
prime
piece
of
land,
prime
location
and
I
started
off
to
try
and
get
the
comparables
closest
to
the
subject
lands,
Zimmer's
and
Armor's,
as
possible.
And
I
might
say,
it
was
very
hard
getting
anything
comparable
because
some
of
them
were
smaller
and
some
of
them
didn't
have
access
so
I
tried
to
get
as
many
comparables
as
close
to
the
subject
lands
and
with
good
values.
I
started
on
the
major
premise
that
I
had
appraised
the
best
pieces
of
lands,
the
best
piece
of
lands
in
the
area
with
the
best
access,
with
the
best
title
and
I
tried
to
get
comparables.
I
ended
up
with
eleven
inferior
comparables
but
the
best
comparables
as
to
being
a
comparable.
I
reject
the
basic
perspective
of
Mr.
Rollheiser
that
the
subject
properties
exhibited
in
1971
any
characteristics
for
the
purposes
which
he
attributed
to
them,
or
that
they
represented
at
that
time
"prime
pieces
of
land".
They
were
in
1971
rural
lands
with
limited
agricultural
value,
holding
a
long
range
—
very
long
range
—
prospect
for
development
which
could
be
appropriate
and
consistent
with
that
arising
in
and
around
the
City
of
Calgary
and
the
Trans-Canada
Highway.
There
was
and
is
no
indication
that
development
could
be
“highway-commercial”
except
in
a
very
modest
way.
It
could
be
some
form
of
“acreage
residential”,
but
that
is
just
speculation,
and
not
a
requirement
of
this
judgment
to
determine.
A
major
portion
of
the
time
of
the
appeals
was
taken
up
by
the
efforts
of
counsel
for
the
appellants
to
show
that,
even
if
the
appellants'
own
appraiser
had
not
established
a
case,
the
case
for
the
respondent's
number
was
equally
weak.
In
my
view
these
appeals
must
be
dismissed
because
of
the
lack
of
acceptable
proof
brought
forward
by
the
appellants
and
dismissed
they
will
be.
But
it
would
be
doing
a
disservice
to
the
efforts
of
counsel
for
the
Minister,
and
his
appraisers
—
Mr.
Schmitt
and
Mr.
Stevenson,
as
well
as
to
the
rebuttal
efforts
of
Mr.
Carroll
for
the
appellants,
to
finalize
the
matter
without
some
comments.
The
reports
and
testimony
of
both
Mr.
Schmitt
and
Mr.
Stevenson
recognized
that
it
was
a
difficult
task
to
provide
viable
comparables
to
the
subject
properties
—
but,
just
as
did
Mr.
Rollheiser,
they
took
the
best
they
could
find,
some
of
which
were
also
the
same
ones
used
by
Mr.
Rollheiser.
The
difference
in
the
methodology
of
these
two
professionals
and
that
of
Mr.
Rollheiser,
was
simply
that
they
accepted
the
subject
property
for
what
it
really
was
on
V-Day
—
a
large
untouched
rugged
parcel
of
land
with
no
immediate
potential
for
anything
other
than
to
minimize
holding
costs
by
whatever
useful
means,
and
wait
for
city
development,
or
other
activity
to
overtake
it
and
find
uses
for
it.
I
have
made
little
reference
to
such
matters
as
zoning,
permits,
access
to
roads,
compatibility
with
other
developments
in
the
area,
etc.,
but
it
should
be
stated
that
the
various
public
bodies
—
municipal,
regional,
provincial
etc.,
including
planning
and
development
agencies
were
conscious
of
the
requirement
for
co-ordination
and
proper
utilization
—
according
to
the
testimony.
In
general,
it
appeared
to
me
that
Mr.
Rollheiser
was
rather
disdainful
of
these
restraints
and
rules
—
believing
they
could
be
adopted
and
adapted
as
development
circumstances
dictated
in
the
area.
I
need
express
no
views
on
that
opinion
of
his,
other
than
to
point
out
that
in
an
appraisal
question
such
as
this
one,
existing
regulations
should
be
considered
seriously
in
this
Court,
barring
clear
and
decisive
evidence
(not
just
opinion)
that
they
are
of
no
value.
Such
evidence
was
not
forthcoming
in
this
appeal,
in
my
view.
Keeping
this
thought
in
mind,
both
Mr.
Schmitt
and
Mr.
Stevenson,
while
not
ignoring
relevant
other
sales,
also
looked
at
the
relative
costs
per
acre
of
tracts
of
land
somewhat
farther
away
from
the
city
for
purposes
and
uses
consistent
with
those
available
for
the
subject
lands
in
1971
—
largely
ranching
and/or
agricultural
and
even
to
some
degree
to
hold
for
future
residential
acreage
developments.
It
is
quite
evident
from
their
reports
that
such
land
—
in
large
parcels
—
was
readily
available
for
amounts
of
about
$750
per
acre.
From
there
they
made
adjustments
and
allowances
to
take
into
account
the
location
of
the
subject
lands
—
adjacent
to
Calgary,
and
with
some
access
to
the
Trans-Canada
Highway.
They
projected
requirements
and
developments
as
well
as
officials
and
purchasers
might
have
been
able
to
do
in
1971,
and
reached
their
conclusions.
For
Mr.
Schmitt
these
were
for
Armor
$1,500
per
acre
(all
rural
land),
and
for
Zimmer
$1,500
per
acre
for
rural
land,
and
$3,500
per
acre
for
the
“city”
land.
For
Mr.
Stevenson,
the
result
for
the
Zimmer
land
was
he
valued
it
at
$1,000
per
acre
for
rural
land,
and
$3,500
per
acre
for
“city”
land.
Their
valuations
are
far
below
the
amounts
attributed
thereto
by
the
respondent
in
the
assessments
at
issue.
In
my
view
they
do
represent,
within
limits,
the
values
per
acre
which
a
serious,
unrestrained,
knowledgeable
purchaser
might
have
discussed
with
the
owners
in
1971.
That
leaves
aside
(in
the
interest
of
the
appellants)
the
question
of
whether
one
could
even
visualize
a
prospective
purchaser
(let
alone
a
"special
purchaser"
to
which
counsel
for
the
appellants
alluded)
for
the
subject
lands
in
1971.
No
evidence
was
adduced
that
there
were
any
such
prospective
purchasers,
for
amounts
per
acre
even
approaching
those
of
Mr.
Schmitt
and
Mr.
Stevenson,
let
alone
Mr.
Rollheiser.
I
would
turn
for
a
moment
to
the
testimony
of
Mr.
Carroll,
a
professional
appraiser
who
gave
rebuttal
testimony
for
the
appellants.
I
would
commend
Mr.
Carroll
for
the
enlightenment
and
assistance
he
provided
—
in
a
competent
and
concise
manner.
While
he
did
bring
out
some
aspects
in
the
Schmitt
and
Stevenson
reports
which,
in
his
view,
warranted
somewhat
higher
valuations,
I
would
respectfully
suggest
that
even
taking
these
fully
into
account
(which
I
would
not
be
prepared
to
do)
would
make
only
a
modest
impression
on
the
gap
between
the
respondent's
appraisal
reports
numbers
and
those
used
by
the
respondent
in
assessing.
His
testimony
while
interesting
was
not
relevant
to
the
real
problem
before
the
Court.
Since
the
testimony
and
evidence
brought
out
on
behalf
of
the
appellants
has
completely
failed
to
support
the
appraisal
numbers
proposed
by
them,
and
little
if
any
damage
has
been
done
to
the
conclusion
of
the
appraisal
reports
submitted
by
the
respondent,
this
Court
finds
no
reason
whatsoever
for
any
adjustment
to
the
assessments
made
by
the
Minister
at
issue
in
these
appeals.
I
make
no
effort
to
reconcile
(as
counsel
for
the
appellants
suggested
I
might)
the
amount
of
$3,500
per
acre
used
by
the
Minister
for
the
Zimmer
rural
property,
and
the
$5,000
per
acre
used
for
the
Armor
property.
They
are
both
much
too
high
in
my
view,
and
favour
the
appellants
in
a
most
considerate
manner.
The
fact
that
one
appellant
may
be
favoured
more
than
the
other
is
not
a
matter
for
this
Court
to
decide
under
the
circumstances
of
these
appeals.
Finally
I
would
sound
a
note
of
caution
which
arose
directly
out
of
the
sustained
efforts
of
counsel
for
the
appellants
to
press
on
the
Court
the
development
potential
of
the
subject
properties
in
1971.
It
is
difficult
indeed
to
follow
the
rationale,
proposed
by
the
appellants
—
in
effect
that
by
1971
the
purpose
and
potential
for
the
subject
lands
had
changed
from
rural
agricultural
ranch
lands
(used
to
produce
income
ostensibly)
to
blossoming,
ripe
for
development,
saleable
lands
which
they
were
really
just
holding
until
an
appropriate
offer
to
purchase
(appropriate
in
their
view)
came
along.
That
situation
lends
itself
very
closely
to
a
consideration
of
whether
the
land
as
an
asset
in
1971
—
in
the
eyes
of
the
owners
—
any
longer
was
an
income
producing
asset,
or
if
it
was
by
then
an
inventory
asset,
available
for
sale,
indeed
with
only
one
purpose
—
to
be
sold
just
as
any
other
inventory
item.
The
Minister,
in
his
wisdom,
did
not
approach
the
assessments
at
issue
with
this
perspective
in
mind,
but
it
must
be
noted
in
these
reasons
for
judgment
as
a
formidable
question
which
the
appellants
did
not
put
to
rest
in
their
zeal
to
promote
their
convictions
regarding
the
property.
In
my
view,
more
than
any
other
one
factor,
it
was
this
view,
so
strongly
held
by
the
appellants,
which
so
materially
affected
and
dictated
the
methodology
of
Mr.
Rollheiser
in
his
efforts
to
be
of
assistance
to
them.
He
may
even
have
been
persuaded
they
were
right,
and
that
leaves
the
appellants
on
even
more
tenuous
grounds
on
this
point.
The
end
result
of
accepting
their
perspective
on
the
highest
and
best
use
in
1971
for
their
properties
could
leave
them
at
risk
that
the
gain
would
be
on
income
rather
than
capital
account
as
presently
assessed.
In
the
end
analysis,
the
Minister
has
acted
correctly,
in
fact
munificiently,
in
striking
the
assessments
at
issue,
and
the
appellants'
efforts
to
show
otherwise,
while
protracted
and
tedious
have
served
no
purpose.
The
assessments
must
stand.
The
appeals
are
dismissed.
Appeals
dismissed.