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Supreme Court of Canada

Taxation—Assessment—By 1966 amendment to Assessment Act, effective January 1, 1967, pipeline company’s compressor equipment assessable and taxable separately as real property—Assessable separately and as real property for first time in 1967 and taxable for first time in 1968—The Assessment Act, R.S.O. 1960, c. 23, s. 41(1) [amended 1966, c. 10, s. 8(1)], s. 52(1).

By an amendment to The Assessment Act, R.S.O. 1960, c. 23, passed in 1966 but made effective January 1, 1967, the respondent company’s compressor facilities ceased to be regarded as part of the company’s pipeline and became assessable and taxable separately as real property. On the issue of whether as a result of the said amendment, the compressor equipment became subject to municipal taxation by the Town of Kapuskasing for the year 1967, the judge of first instance and the Court of Appeal were of the opinion that the legislation enabled the municipality to assess the equipment separately and as real property for the first time in 1967 and that it became subject to taxation for the first time in 1968. The district assessor appealed to this Court from the decision of the Court of Appeal.

Held: The appeal should be dismissed.

Section 52(1) of the Act, upon which the appellant relied, had no application because the amending legislation by its very terms did not come into force until January 1, 1967. In the terms of s. 52(1) there was no land liable to assessment which had been omitted from the collector’s roll for the current year or either or both of the next two preceding years. The compressor equipment became separately assessable for real property and business assessments for the first time in 1967, and when this assessment

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was transferred to the collector’s roll, such equipment first became taxable in 1968.

APPEAL from a judgment of the Court of Appeal for Ontario, dismissing an appeal from a judgment of Hartt J. Appeal dismissed.

Bernard Chernos, for the appellant.

George D. Finlayson, Q.C., and Thomas G. Heintzman, for the respondent.

The judgment of the Court was delivered by

JUDSON J.—The issue in this appeal is whether as a result of an amendment to s. 41(1) of The Assessment Act, enacted in 1966, the compressor equipment of Trans-Canada Pipe Lines Limited became subject to municipal taxation by the Town of Kapuskasing for the year 1967. The amending legislation with which we are concerned came into force on January 1, 1967. My opinion is that the legislation enabled the municipality to assess the compressor equipment separately and as real property for the first time in 1967 and that it became subject to taxation for the first time in 1968. This was the opinion of the judge of first instance and the unanimous opinion of the Ontario Court of Appeal.

The 1966 amendment (14-15 Eliz. II, c. 10, s. 8(1)) followed upon a decision of the Ontario Court of Appeal in Town of Oakville v. Ontario Natural Gas Storage and Pipe Lines Limited (May 10, 1966, unreported), This decision was approved and adopted in this Court in 1966 without further written reasons. It held that compressor equipment had to be assessed, not separately, but as part of the pipeline and in accordance with the prescribed rates per linear foot of pipe. These rates depended upon the diameter of the pipe.

The present appeal was argued on the basis that the effect of the 1966 amendment was that the compressor equipment ceased to be regarded as part of the pipeline and became assessable and taxable separately as real property. It is unnecessary to set out the legislation, before and after, to show how this result was brought about.

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In 1966 the pipeline company was correctly assessed for real property, business and pipeline assessment, the compressor equipment being included in the pipeline assessment. The assessment roll was returned on September 30, 1966, and certified correct by the Court of Revision on November 24, 1966.

In 1967 the pipeline company paid tax to the Town of Kapuskasing based upon the assessments made in 1966, these assessments having been transferred to the collector’s roll for 1967 in accordance with s. 110 of The Assessment Act. By notice of assessment prepared by the Town of Kapuskasing in 1968 and received by the pipeline company on February 26, 1968, the town purported to add to the 1967 collector’s roll, real property and business taxation for 1967 under s. 52 of The Assessment Act in respect of the pipeline company’s compressor equipment in the Town of Kapuskasing.

Section 52 of The Assessment Act reads:

52. (1) If at any time it appears to any officer of the municipality that land liable to assessment has been omitted from the collector’s roll in whole or in part for the current year or for either or both of the next two preceding years, he shall report the omission to the clerk of the municipality; thereupon. the clerk shall enter such land on the collector’s roll as well for the arrears of the preceding year or years, if any, as for the tax on the current year…

This section has no application to the facts of this case because the amending legislation by its very terms did not come into force until January 1, 1967. The 1966 assessment, which was certified correct by the Court of Revision on November 24, 1966, was the only assessment that could be made in accordance with the law as stated in the Oakville case. This assessment was correctly on the collector’s roll for the year 1967. No other assessment could be transferred from the assessment roll to the collector’s roll. In the terms of s. 52(1) there was no land liable to assessment which had been omitted from the collector’s roll for the current year or either or both of the next two preceding years. The compressor equipment became separately assessable for real

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property and business assessments for the first time in 1967, and when this assessment was transferred to the collector’s roll, such equipment first became taxable in 1968.

I would dismiss the appeal with costs.

Appeal dismissed with costs.

Solicitors for the appellant: Feigman & Chernos, Toronto.

Solicitors for the respondent: McCarthy & McCarthy, Toronto.

 

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