ARTS UMBRELLA ASSESSOR OF AREA 09 - VANCOUVER. SUPREME COURT OF BRITISH COLUMBIA (L052096) Vancouver Registry

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1 The following version is for informational purposes only, for the official version see: for Stated Cases see also: for Property Assessment Appeal Board Decisions SC 494 Arts Umbrella v. AA09 Link to Property Assessment Appeal Board Order Quick Link to Stated Case #494 (BCCA Application for Directions) Quick Link to Stated Case #494 (BCCA) See also Stated Case #481 ARTS UMBRELLA v. ASSESSOR OF AREA 09 - VANCOUVER SUPREME COURT OF BRITISH COLUMBIA (L052096) Vancouver Registry Before the HONOURABLE MADAM JUSTICE MORRISON Date and Place of Hearing: January 17, 2006, Vancouver, BC John R. Singleton, Q.C. for the Appellant John H. Shevchuk for the Respondent Charitable Non-Profit Society Definition of "meeting hall" Fraternal Organization Arts Umbrella is a charitable non-profit society whose purpose is to offer visual and performing arts education to children and teenagers. Arts Umbrella has an unregistered long term lease with the Canadian Mortgage and Housing Corporation. The Property Assessment Appeal Board ("the Board") found that Arts Umbrella is not a fraternal organization under section 8(b) of B.C. Reg. 438/81, the Prescribed Classes of Property Regulation ("the Regulation") and that the property should not be classified as Class 8 since it did not come within the meaning of "meeting hall" as defined under section 8(b) of the Regulation. Arts Umbrella appealed to this Court and asked the following questions: 1. Is Arts Umbrella a "non-profit fraternal organization" as that term is used in section 8 of the Regulation? 2. Are all or part of the facilities of the Arts Umbrella facility used as a "meeting hall" as that term is used in section 8 of the Regulation? HELD: Appeal Allowed. Regarding the first question, this Court found that Arts Umbrella is a society similar in many respects to the BC Soccer Association. Arts Umbrella is made up of members who are largely volunteers whose focus is to help children through its programs, much as the Soccer Association has as its objective to develop soccer for the benefit of youth. Taking too narrow a definition in this case would result in unfairness and would go against the spirit of the Regulation itself. Class 8 provides a category of assessment that results in tax relief. It is not meant to give relief to a club or a society such as a private and social club. It is meant to include an organization whose focus and objects are for the benefit of others within the community. This Court found that Arts Umbrella is a "non-profit fraternal organization" as that term is used in section 8 of the Regulation. Regarding the second question, this Court found that the meaning of meeting hall should not be narrowly construed. Also, the Court held that any area in the facilities which is to be used as a meeting page 1

2 hall need not necessarily be used all of that time for meeting hall purposes. The important factor is not that the premises are "used" for meeting halls but that they must be available, and set aside for use for the required number of days, whether they are used to the fullest extent or not. This Court decided that Arts Umbrella had demonstrated that availability and therefore found that all or part of the Granville Island facilities of the Arts Umbrella are used as a "meeting hall" as that term is used in section 8 of the Regulation. Reasons for Judgment February 16, 2006 [1] This is a Stated Case brought by the Appellant, Arts Umbrella pursuant to s. 64 of the Assessment Act, R.S.B.C. 1996, c. 20 (the "Act"). [2] Incorporated under the Society Act, R.S.B.C. 1996, c. 433 as the Children's Arts Umbrella Association, Arts Umbrella is a charitable non-profit society whose purpose is to offer visual and performing arts education to children and teenagers, enhancing their ability to take responsibility for their own interests and actions, and to develop their self-reliance and resourcefulness, with the object of making them better members of society. [3] This assessment dispute involves the facilities occupied by Arts Umbrella at 1286 Cartwright Street on Granville Island in Vancouver. The building is owned by the Canadian Mortgage and Housing Corporation ("CMHC") and rented to Arts Umbrella under a long term lease. The lease cannot be registered. [4] For purposes of property tax assessment under the Act, the facility on Granville Island has historically been classified as Class 8 - Property, as property that qualifies as "a meeting hall for a non-profit fraternal organization", as set out in Class 8(b) under B.C. Regulation 438/81. [5] In 2002, the B.C. Assessment Authority re-classified the Granville Island facility as a Class 6 property. [6] In the decision dated March 12, 2004, under an appeal pursuant to s. 50 of the Act, the Property Assessment Appeal Board confirmed the decisions of the 2002 and 2003 Property Assessment Review Panels. The Property Assessment Appeal Board (the "Board") held that while Arts Umbrella is a non-profit organization, it is not a fraternal organization as contemplated under s. 8(b) of the Regulation. The Board further held that the Granville Island facilities should not be classified as a Class 8 property since it did not come within the meaning of "meeting hall" as defined under s. 8(b) of the Regulation. [7] The questions which the Board is required to ask for the opinion of this court are: (1) Whether Arts Umbrella is a "non-profit fraternal organization" as that term is used in s. 8 of the B.C. Regulation 438/81. (2) Whether all or part of the facilities of Arts Umbrella at 1286 Cartwright Street are a "meeting hall" as that term is used in s. 8 of B.C. Regulation 438/81. [8] The parties have agreed on the material facts as set out by the Board in the Stated Case. They have agreed that for the purposes of the questions on this Stated Case, the facts and findings made by the Board in the appeal will apply. [9] The actual members of Arts Umbrella are the members of its Board of Directors, plus advisory members, life members and three elected staff members. The programs for children are provided to 30,000 children each year both at the facilities on Granville Island and some inner-city schools. Operations and fundraising are assisted by government and private funding. There is a team of 250 volunteers and an office staff of 24 responsible for raising funds and administering programs. Arts Umbrella operates with a number of committees. The building on Granville Island encompasses 22,215 square feet and consists of rooms which are used as visual and performing arts studios, meeting rooms, office facilities and other uses necessarily incidental to these functions. [10] It is agreed that Arts Umbrella did not change either its structure or the uses made of the various rooms at their facility from 2001 to the present time. In addition to the board members, staff, and volunteers, Arts Umbrella also hires 80 ad hoc teachers and assistants. page 2

3 [11] The 30,000 children and teens enrolled in the Arts Umbrella programs are the intended and direct beneficiaries of the activities of the organization. These children and teens are not members of the organization itself. [12] In the agreed statement of facts, it is acknowledged that the members of Arts Umbrella have not banded together for their own mutual benefit; rather, they have banded together so benefits might be conferred on the non-members, the children and teens as set out in the objects and purposes of the society. [13] With regard to the appropriate assessment of the property in question, s. 19(14) of the Assessment Act states as follows: The Lieutenant Governor in Council must prescribe classes of property for the purpose of administering property taxes and must define the types or uses of land or improvements, or both, to be included in each property class. [14] The prescribed classes of property are found under Regulation 438/81. Class 6 is titled "business and other" and simply states, "Class 6 property shall include all land and improvements not included in Classes 1 to 5 and 7 to 9." [15] Class 8 is entitled "recreation property/non-profit organization". 8(b) is the portion in question, and that states as follows: Class 8 property shall include only:... (b) that part of any land and improvements used or set aside for use as a place of public worship or as a meeting hall for a nonprofit fraternal organization of persons of either or both sexes, together with the facilities necessarily incidental to that use, for at least 150 days in the year ending on June 30, of the calendar year preceding the calendar year for which the assessment roll is being prepared, not counting any day in which the land and improvements so used or set aside are also used for (i) any purpose by an organization that is neither a religious organization nor a non-profit fraternal organization, (ii) entertainment where there is an admission charge, or (iii) the sale or consumption, or both, of alcoholic beverages. [16] Class 10 deals with "split classification". It states as follows: (Emphasis added) 10. Where a property falls within 2 or more prescribed classes, the assessor shall determine the share of the actual value of the property attributable to each class and assess the property according to the proportion each share constitutes of the total actual value. Position of the Appellant, Arts Umbrella [17] Arts Umbrella submits it is a non-profit "fraternal organization" as that term has been interpreted by the courts and also interpreted in previous decisions of the Board. Further, that all or part of the facilities at Granville Island qualify as a meeting hall. Thus, Arts Umbrella should qualify to be classified as a Class 8 property under the Regulation. The Appellant seeks that this court instruct the Board to direct the page 3

4 Assessor to make any necessary amendments to the assessment roll to give effect to the decision of this court, pursuant to s. 65 of the Act. [18] Counsel for Arts Umbrella argues that the Assessment Authority and the Board are wrong in ruling that Arts Umbrella is not a "fraternal organization". Counsel points to the underlying purpose of the Act and the Regulations, and states that it is clear from s. 7 and the authorities that there is no intention to impose property tax on charitable organizations that are involved in offering subsidized arts education to the public at large. [19] In Union Club of British Columbia v. British Columbia (Capital Assessor Area No. 01 Saanich), [1993] B.C.J. No. 2883, our B.C. Court of Appeal found the Union Club was not a fraternal organization under what was then s. 8(c), now 8(b). The Court found it was a private social club, and the objects of the club did not qualify the club as a fraternal organization for the purpose of the Regulation. However, the Appellant cites Mr. Justice Goldie, who in writing for the court, made certain observations in his analysis of Classes 6 and 8, the same Classes that are in dispute in this case. [20] At paragraph 14, Goldie J.A. stated that property should not be included in Class 6:...if it can reasonably fall within a classification that complies with the statute. In some degree this was recognized by the Board in its decision in B.C. Soccer Association v. Assessor of Area #10 (Assessment Appeal Board, unreported, June 13, 1990) where at p. 4 of his reasons, the presiding member said: In B.C. Regulation 438/81 eight of the classifications have clear definitions. The only class that does not have a clear definition is Class 6 - Business and Other. Business is not referred to anywhere in this definition except in the title. It is known in assessment circles as the "basket" clause of the "catchall" clause. Whenever a property does not seem to be able to be slotted precisely into any of the other eight clearly identifiable classes, the Assessor applies a Class 6 designation. [21] At paragraph 15, Goldie J.A. stated, "A strict exclusionary approach to classification under the Regulation would not appear to accord with the intention of the legislature." [22] At paragraph 28 of the Union Club decision, Goldie J.A. stated, "I think the phrase "non-profit fraternal organizations" is a description of a class which has been and must continue to be broadly defined." [23] The court rejected a more narrow interpretation of a fraternal organization that had been applied in an earlier case, Marpole Curling Club v. British Columbia (Assessor of Area No Vancouver), [1988] B.C.J. No At paragraph 25 of the Union Club decision, the court stated: With all respect, if this group is treated as exhaustive of the class of fraternal organizations I think the Regulation would be too strictly construed. [24] In rejecting the more narrow definition found in Webster's Dictionary, Goldie J.A. at paragraph 26 referred to the B.C. Soccer Association decision where the narrower definition would have excluded what the Board had accepted as a fraternal organization in the B.C. Soccer case. He noted that the aim and objective of the society in the B.C. Soccer case was to develop soccer and that it had 55,000 soccer players under its jurisdiction, both boys and girls. [25] In the B.C. Soccer Association v. Assessor of Area #10 - Burnaby-New Westminster (1990), Roll No.: case, the Board found that the B.C. Soccer Association was a fraternal organization. That was a decision on August 3, In that case the Assessor had applied a split classification to the property, with 18% of the property found to be in Class 8 and the balance found in Class 6. The Assessor had found that "offices" were not meeting halls. page 4

5 [26] The Assessment Appeal Board disagreed. It found that the aim and objective of the society was to develop soccer, with 55,000 soccer players under its jurisdiction. The soccer players were not members of the society. [27] On page 6 of its decision, the Board stated: The Board is of the opinion that the draughters of the Regulation felt that organizations such as the Appellant, made up of volunteers giving their time freely for the benefit of the community at large, should not be taxed for land or improvements used for these beneficial purposes.... The Board agrees that offices can be considered to be incidental to the use of the meeting hall. The meeting hall was used as a meeting place for the members of the society. The purpose of the society is to organize, supervise, and develop soccer within the province. It is certainly a worthwhile endeavour in the development and training of young persons of the province. These offices are required for these purposes i.e., the organization and development of soccer, and are used and occupied by various volunteer soccer organizations for that purpose and are incidental to the use of the meeting hall. [28] In this Stated Case, the Appellant argues that Arts Umbrella is in the same position as the B.C. Soccer Association, benefiting thousands of young people, who are not actual "members" of the fraternal organization itself. But rather, as with the Soccer Association, Arts Umbrella consists of volunteers who give their time freely for the benefit of the community at large. [29] The Appellant also cited the case of Composers, Authors and Publishers Assn. Canada v. Kiwanis Club of West Toronto, [1952] Ex. C.R. 162, a decision of the Exchequer Court of Canada. In that case, the Kiwanis Club was found to be a non-profit service club, raising funds for the benefit of underprivileged children and other charities. [30] At paragraph 41, the court dealt with whether the defendant was a fraternal organization. "A 'fraternal organization' is not defined, but if it is to be judged by its associates, it would seem to be an organization which in some way is devoted to public service and which endeavours in one way or another to bring about better conditions in those fields which are generally recognized as being for the public good." At paragraph 49, the court found that the Kiwanis Club was "a body of men associated by some common interest and is therefore a fraternal organization. Its members not only fraternize or unite as brothers, but by those activities... they exemplify toward the needy and underprivileged the care and solicitude which one would expect of a brother." [31] On the issue of whether the facilities on Granville Island constitute a "meeting hall", the Appellant cited the B.C. Court of Appeal decision in New Westminster Chamber of Commerce v. Burnaby/New Westminster Assessor Area No. 10 (1993), 85 B.C.L.R. (2d) 175. Mr. Justice Goldie wrote that the meaning to be given to meeting hall would be decided by a number of factors. It may be a split classification, the use of the meeting hall need not be continuous, the use need not be an exclusive use, there may be more than one meeting hall within a single property, and a meeting hall need not be confined to one room. [32] In that case, the Assessor had agreed that the Chamber of Commerce was a non-profit fraternal organization, but ruled that its property was not a meeting hall. [33] The Appellant argues that Mr. Justice Goldie's reasons indicate that the meaning of meeting hall should not be narrowly construed. And further, that an area in the building which is available for use as a meeting hall for at least 150 days out of the year, but not necessarily used all of that time, is nonetheless a meeting hall. page 5

6 [34] In the evidence before the Board in this case, a list of rooms available at the Granville Island facility was entered as evidence. Meetings occurred in each room, and members attended, along with nonmembers. The Appellant submits it need only show that the facilities in question were suitable for and used or set aside for use over the stipulated period of time. The Appellant argues that there were usually one or more rooms made available for member meetings at any given time. Position of the Respondent, The Assessor [35] The Respondent acknowledges that Arts Umbrella is a non-profit society, but contends it is not a fraternal organization. According to the evidence, the rooms in the facility were not set aside for the purpose of meeting halls, and there was no evidence to establish the actual amount of use of the rooms as meeting halls. Therefore, no evidence could establish that any portion of this facility was used or set aside as a meeting hall for the required 150 days of the year under s. 8(b) of the Regulation. [36] Counsel for the Respondent argues that at best, on the facts presented, there may be some form of split classification possible, but there was no evidence to establish this either. [37] The Assessor seeks an order that the Board did not err in law in respect of the questions posed. Stated Cases can be decided on questions of law only. The position of the Respondent is that the second question involves mixed fact and law, and is therefore beyond the jurisdiction of this court. [38] The standard of review is correctness. Counsel for the Respondent reminds that this court is restricted to a consideration of the facts set out in the Stated Case and in the reasons of the Board. Facts upon which the Appellant seeks the opinion of the court are those that are set out in paragraphs 1 to 26 of the Stated Case filed by the Board. [39] In denying that Arts Umbrella is a fraternal organization, the Respondent also cites the Union Club case, pointing to paragraphs of the decision of Mr. Justice Goldie where he found assistance in determining the characteristics of other organizations which sought to be classified as fraternal organizations. [40] The Respondent argues that in reading those further portions of the Union Club decision, it is clear that a fraternal organization must be formed for the mutual assistance of its members and for the promotion of benefits among its members. Also, that this definition of fraternal organization was adopted by the Board in the Board's decision of Assessor of Area No. 14 Surrey/White Rock v. White Rock Players Club, December 12, 1996, P.A.A.B. Decision No That case involved a community theatre in White Rock. The purpose of that society was to provide live theatre to the community and provide a venue for members to engage in theatrical activities. In that case, the Board found as follows: "The essence of a fraternal organization is that it is an organization of people banded together to assist and support each other and promote moral, intellectual or social benefit amongst its own members." (Page 4) [41] The Respondent argues that the emphasis of both the Court of Appeal and the Board is on the need for assistance and support amongst the members of the society. And that is a feature missing from the facts and situation with the Arts Umbrella situation. None of the children or teenagers who participate in the programs are members of the society. [42] To be a fraternal organization, the Respondent submits that the society must be formed for the mutual assistance of its members and for the promotion of benefits only among its members. Both the Court of Appeal in the Union Club case and the Board in the White Rock Players decision have placed an emphasis on the need for assistance and support amongst members of the societies. And that is the fatal flaw in the submission of the Arts Umbrella appeal, according to the Respondent. The ones who benefit in this case are the children and teenagers who take part in the programs, and they are not members. [43] The decision of Gould v. Yukon Order of Pioneers 1996 CarswellYukon 6F, [1996] 1 S.C.R. 571 is also cited by the Respondent. page 6

7 [44] In responding to the arguments of the Appellant, the Respondent acknowledged that the Board in the B.C. Soccer case had suggested that an organization made up of volunteers donating their time for the benefit of the community should not be taxed; the Court of Appeal in the Union case did not adopt that language in deciding whether the Union Club qualified under Class 8. [45] The Respondent also disagrees with the Appellant's position with regard to the Composers case, saying there is no basis for expanding the definition of fraternal in s. 8 as there may have been in the Composers case. [46] Section 2(1) of the Society Act, R.S.B.C. 1996, c. 433, provides that a society may be incorporated for any lawful purpose including "philanthropic, charitable, fraternal, benevolent, artistic, educational, social." The Respondent submits that the Legislature intended a distinction between fraternal and charitable as well as the other categories listed. [47] Counsel for the Respondent also argues that the Appellant does not make the necessary distinction between assessment and taxation. This Act and Regulation 438/81 are concerned only with assessment. And if the Appellant wishes tax relief or tax exemption as a non-profit organization, then it must look for that tax relief other than in the Assessment Act. To qualify for an exemption or tax relief, the Appellant may have to seek an amendment to the Vancouver Charter, but that is a matter beyond the scope of this review. [48] The Respondent denies that the rooms within the facilities of Arts Umbrella are "meeting halls". That the rooms are first classrooms, and only if they are not being used as classrooms, can they be used for meetings. The Respondent submits that the rooms can only qualify as meeting halls if used exclusively by members, and the agreed upon facts note that non-members are sometimes in attendance as well. [49] Weight must be given to the predominant or primary use of the facility, according to the Respondent. And that is for the purpose of classes. Secondary use of the rooms cannot then transform the rooms into "meeting halls" for the purposes of s. 8. No room within the facilities has been "set aside" for the purpose of a meeting hall. [50] The Appellant relied upon Appendix C which was before the Board, and which set out the total hours available for meetings for each studio per week/year, but the Respondent argues that this Appendix only indicates when classrooms are not being used as classrooms. It does not indicate that the rooms are being used by members only as meeting halls. The Appellant failed to provide the Board with sufficient evidence to reach the necessary conclusion as to use. [51] While the rooms listed in Appendix B and Appendix C may be available, when not being used for classes, no particular room has been set aside as a meeting hall. And one small room, used as a dark room, is never available for meetings. [52] The Respondent further contends that the Appellant has provided no lists of attendees for meetings, no minutes of committees, and the Appellant cannot provide sufficient proof that the rooms were actually used as meeting halls, and if so, when. Thus Arts Umbrella has been unable to show that any part of its facilities have been used or set aside for use as a meeting hall for at least 150 days in the calendar year ending June 30. Thus the Appellant's case must fail. Conclusion [53] As to the first question, is Arts Umbrella a "non-profit fraternal organization" under s. 8 of B.C. Regulation 438/81, in my view it is. [54] Arts Umbrella is a society similar in many respects to the B.C. Soccer Association, and the Appeal Board's decision in that case is helpful. As with the B.C. Soccer Association, Arts Umbrella is made up of members who are largely volunteers whose focus is to help children through its programs, much as the Soccer Association has as its objective to develop soccer for the benefit of youth. page 7

8 [55] The decision of Mr. Justice Goldie in the Union Club decision referred to the "objects" of the club, and the "focus" of the club. Clearly, the Union Club did not have the focus or objects that would qualify it as a fraternal organization. But as Mr. Justice Goldie stated, non-profit organizations within what is now Class 8(b) should be described as a class which should be "broadly defined". [56] Taking too narrow a definition in this case would result in unfairness, and would go against the spirit of the Regulation itself. Class 8 provides a category of assessment that results in tax relief. It is not meant to give relief to a club or a society such as the private and social Union Club. It is meant to include an organization whose focus and objects are for the benefit of others within the community. There is an obvious difference between organizations such as the B.C. Soccer organization, the Kiwanis Club, and Arts Umbrella, as opposed to the Union Club. It is not just that they are non-profit; it is also the focus of the club or society, and the objects under which they operate. [57] The second question under the Stated Case is whether all or part of the facilities of Arts Umbrella at 1286 Cartwright Street are a "meeting hall" as that term is used in s. 8 of the Regulation. [58] To qualify as Class 8 property, it must include part of any land or improvements that are "used or set aside for use... as a meeting hall...". [59] When this matter went before the Property Assessment Appeal Board, counsel submitted an agreed statement of facts. Those facts included the following: that the facilities on Granville Island were used variously as visual and performing arts studios, meeting rooms, office facilities and uses necessarily incidental to those uses. Further, that all of the rooms listed in Appendix B were from time to time used for meetings of the members of Arts Umbrella, that no rooms were specifically designated as "meeting rooms", but all of the rooms listed in Appendix B were available for and used as meeting rooms throughout the year when not otherwise being used for classes. Further, that Appendix C was a schedule of the availability and use of the rooms listed in Appendix B. [60] In its decision, at paragraph 42, the Board had this to say: With respect to the matter of actual use, while meetings undoubtedly occur from time to time in the studios, I do not have any reliable evidence before me upon which I could reasonably conclude that the studios are actually used for purposes of members meetings for a total of not less than 150 days for each of the years in question. [61] In the Stated Case, it is set out in paragraph 1 that the parties have agreed that for the purposes of the questions on the Stated Case, the facts and findings that were made by the Board would apply. And in the stated material facts set out in the Stated Case, it was noted that the facilities on Granville Island were made up of rooms which were used variously as visual and performing arts studios, meeting rooms, office facilities and uses necessarily incidental to those uses. The stated facts attached Appendix A, a list of the committees existing, Appendix B, the rooms that were available, and Appendix C, the schedule of the availability and use of the rooms listed in Appendix B. Appendix A, B and C were also before the Board. [62] As stated, Appendix C set out the total hours available for meetings for each studio per week/year and those hours totalled in excess of 40 weeks of availability over the period of one year. This does not mean the actual hours that were in fact used, but rather, the total hours that were available for meetings for each studio or each room per week and per year. [63] The material facts set out in the Stated Case included the following: that meetings are attended only by members of Arts Umbrella on some occasions, and by members of Arts Umbrella and non-members on other occasions. That the facility on Granville Island has historically been classified for purposes of property tax assessment as Class 8; and more particularly, "as property that qualifies as a meeting hall for a non-profit fraternal organization under s. 8(c) of the Regulations (now 8(b)); that the Board held that the facility should not be classified as a Class 8 property since it was not a meeting hall, that the evidence page 8

9 before the Board did not indicate that the premises were "used or set aside... as a meeting hall... for at least 150 days of the year"; and that the evidence before the Board was that the overwhelming majority of the space of the Granville Island facility is used or set aside for use for visual and performing arts programs. [64] "The Board held that none of the studios were "set aside" (a term which denotes in the Board's opinion, a notion of reservation or restriction) for use as a meeting room for the members of the organization." [65] I agree with the Appellant that the meaning of meeting hall first of all should not be narrowly construed. Also, that any area in the facilities which is to be used as a meeting hall need not necessarily be used all of that time. But that area must be available for use for at least 150 days out of the year. [66] The evidence did not confirm when or for how long these rooms were in fact used for purposes of members meetings. However, the Regulation, Class 8(b) says that part of the land is to be "used or set aside for use". It does not stipulate that there must be actual use for at least 150 days of the year. Rather, that the rooms must be either used or set aside for use for those number of days. Appendix C indicated that the times available for each room, with the exception of the dark room, were for over 40 weeks of the year, well in excess of 150 days. [67] The dark room is a very small room set aside presumably for the purposes of photography. The amount of space is inconsequential, and should have no bearing on the decision as to whether the Arts Umbrella facilities constitute a meeting hall under the Regulation. [68] Mr. Justice Goldie made it quite clear in the New Westminster Chamber of Commerce case that the use of a meeting hall need not be continuous, nor exclusive, nor confined to just one room. [69] The overall intention of the Act and Regulation is not to provide an exemption or safer tax haven for a false charity or a merely private club or society. Where s. 8 can legitimately be given a broad interpretation, it should be. [70] I do not agree with the Respondent that the second question involved mixed fact and law and is beyond the jurisdiction of this court. [71] In my view, it would be an incorrect legal test to say that "set aside" means that the premises must actually be used. The important factor is that they must be available, and set aside for use for the required number of days, whether they are used to the fullest extent or not. Arts Umbrella has demonstrated that availability. It has also shown the required number of days where the rooms are available for use. [72] In summary, is Arts Umbrella a non-profit fraternal organization as that term is used in s. 8 of B.C. Regulation 438/81? Yes. [73] Are all or part of the facilities of Arts Umbrella at 1286 Cartwright Street a "meeting hall" as that term is used in s. 8 of B.C. Regulation 438/81? Yes. [74] Unless the parties wish to address costs separately, costs in the cause, scale 3. SC 494Cont Arts Umbrella v AA09 ARTS UMBRELLA v. page 9

10 ASSESSOR OF AREA 09 - VANCOUVER BRITISH COLUMBIA COURT OF APPEAL (CA33882) Vancouver Registry Before the HONOURABLE MADAM JUSTICE HUDDART (in chambers) Date and Place of Hearing: November 29, 2006, Vancouver, BC J.A. McLachlan for the Assessor of Area 09 J. Singleton, Q.C. for Arts Umbrella Application for Directions The issue in this application is whether an appeal can be taken to the BC Court of Appeal from an opinion of the Supreme Court on a reference given under section 64 of the Assessment Act as opposed to an appeal under section 65. HELD: Appeal Dismissed. 1. The proper interpretation is that the only access to the Court of Appeal is through an appeal of a decision of the Supreme Court decision by way of a Stated Case from a final decision of the Property Assessment Appeal Board (i.e. a section 65 Stated Case). There is no appeal to the Court of Appeal with respect to a Stated Case under section 64 of the Act. 2. Sections 64 and 65 of the Act have distinct purposes in the appeals system. Section 64 allows the Board to receive advice from the Supreme Court on a question of law during the proceedings to assist it to come to a final decision. Section 65 deals with appeals from a final decision of the Board, and as such specifically allows for further appeals to the BC Court of Appeal. Reasons for Judgment January 29, 2007 [1] This application for directions as to the proper procedure to appeal a decision made under s. 64 of the Assessment Act, R.S.B.C. 1996, c. 20 [the "Act" hereinafter] arises out of amendments brought into force by regulation on 23 October 1998 (B.C. Reg. 367/98) with the intention of making the assessment appeals system more efficient. The fundamental issue is whether an appeal can be taken from an opinion of the Supreme Court given under s. 64 of the Act, as amended. The Assessor says no; the Respondent property owner says yes. [2] On this application, I will confine myself to that issue and not comment on the accompanying leave application or on the "procedural wrinkles" identified in Talbot v. British Columbia (Assessor of Area No North Shore/Squamish Valley) (2004), 245 D.L.R (4th) 587 at para. 13, 2004 BCCA 493 ["Talbot" hereinafter], an appeal under s. 65 of the Act from a final decision of the Assessment Appeal Board. [3] Counsel agree this court has only the jurisdiction conferred by legislation (Johnson v. Laing (2004), 242 D.L.R (4th) 48 at para. 26, 2004 BCCA 364), that every enactment must be given a fair, large and liberal interpretation to ensure the attainment of its objects (Interpretation Act, R.S.B.C. 1996, c. 238, s. 8) and that section headings can be used as a guide to interpretation of a statute (Law Society of Upper Canada v. Skapinker, [1984] 1 S.C.R 357 at 13-14, 9 D.L.R (4th) 161). Both parties further agree that the legislative history of the appeal provisions of the Act is the most effective guide to the task before me; however they disagree as to the correct interpretation of that history. [4] In the Assessment Act, R.S.B.C. 1979, c. 21, the comparable provisions stated in their relevant parts: Procedure on appeal on law to Supreme Court 74. (1) At any stage of the proceedings before it, the board, on its own initiative or at the request of one or more of the persons affected by the appeal, may submit, in the form of a stated case for the opinion of the Supreme Court, a question of law arising in the appeal, and shall suspend the proceedings and reserve its decision until the opinion of the final court of appeal has been given and then the board shall decide the appeal in accordance with the opinion. page 10

11 (2) A person affected by a decision of the board on appeal... may require the board to submit a case for the opinion of the Supreme Court on a question of law only by (7) An appeal lies from the determination of the Supreme Court to the Court of Appeal on any point of law raised or determined on the hearing of the appeal by the judge. Action by board on receipt of court's decision 75. After receipt of the decision of the Supreme Court or the Court of Appeal on an appeal or stated case, the board shall, if the opinion is at variance with the conclusion at which it had itself arrived, direct the assessor to make the necessary amendment to the assessment roll in accordance with the decision. [5] Subsequently the Act was amended so that the Assessment Act, R.S.B.C. 1996, c. 20 provided in its relevant parts: PART 8 - STATED CASES AND APPEALS ON MATTERS OF LAW Procedure on appeal on law to Supreme Court 63. (1) At any stage of the proceedings before it, the board, on its own initiative or at the request of one or more of the persons affected by the appeal, may submit a stated case to the Supreme Court on a question of law arising in the appeal. (2) If the board submits a stated case under subsection (1), the board must (a) suspend the proceedings and reserve its decision until the opinion of the final court of appeal has been given, and (b) decide the appeal in accordance with the opinion. (3) A person affected by a decision of the board on appeal... may require the board to submit a case for the opinion of the Supreme Court on a question of law alone by (7) The Supreme Court must hear and determine the question and within 2 months give its opinion and cause it to be remitted to the board, but the court may send a case back to the board for amendment, in which event the board must amend and return the case accordingly for the opinion of the court. (8) An appeal on a question of law lies from a decision of the Supreme Court to the Court of Appeal with leave of a justice of the Court of Appeal. Action by board on receiving court's decision 64. After receiving the decision of the Supreme Court or the Court of Appeal on an appeal or a stated case, the board must, if the opinion is at variance with the conclusion at which it had itself arrived, direct the assessor to make the necessary amendment to the assessment roll in accordance with the decision. After the amendments enacted by the Assessment Amendment Act, S.B.C. 1998, c. 22, s. 12 (effective 23 October 1998), the relevant provisions are these: page 11

12 PART 7 - REFERENCES AND STATED CASES ON APPEAL Reference on question of law to Supreme Court 64. (1) At any stage of a proceeding before it, the board, on its own initiative or at the request of one or more of the persons affected by the appeal, may refer a question of law arising in the proceeding, in the form of a stated case, to the Supreme Court.... (3) The board must (a) suspend the proceeding as it relates to the stated case and reserve its decision until the opinion of the Supreme Court has been given, and (b) decide the appeal in accordance with the opinion.... (5) Subject to subsection (6), the court must hear and determine the stated case and within 2 months give its decision. (6) The court may send the stated case back to the board for amendment and the board must promptly amend and return the stated case for the opinion of the court. Appeal of board decision on question of law 65. (1)... a person affected by a decision of the board on appeal... may require the board to refer the decision to the Supreme Court for appeal on a question of law alone in the form of a stated case.... (7) The court may send the stated case back to the board for amendment and the board must promptly amend and return the stated case for the opinion of the court. (8) The costs of and incidental to, a stated case under this section are at the discretion of the court. (9) An appeal on a question of law lies from a decision of the Supreme Court to the Court of Appeal with leave of a justice of the Court of Appeal. (10) The board must direct the assessor to make any amendment to the assessment roll necessary to give effect to a decision made by the Supreme Court or the Court of Appeal under this section. [6] As the headings indicate, the amendments separated the provisions of the old s. 63 (R.S.B.C. 1996, c. 20) relating to a reference during the Board's hearing from those relating to an appeal from its decision, putting the former (reference) into s. 64 and the latter (appeal) into s. 65 (S.B.C. 1998, c. 22, s. 12). [7] In the old provisions (R.S.B.C. 1996, c. 20), the process was common to both, by way of a Stated Case on a question of law to the Supreme Court (s. 63(1)), with the right to appeal that court's decision with leave to the Court of Appeal (s. 63(7)). A reference during a proceeding required the Board to suspend its proceedings and reserve its decision "until the opinion of the final court of appeal had been given" (s. 63(2)(a)). The effect of an opinion, on a reference or a final decision, was comparable but necessarily different. If the decision was on a reference, the Board was to decide the appeal in accordance with the final opinion given. If the final opinion was given on a case stated following its decision, the Board was to direct the Assessor to make the necessary amendment to the assessment roll in accordance with that opinion. page 12

13 [8] The essence of the Respondent's submission is that the amendments affected that process only in permitting the Board to continue its proceedings pending an appeal from a decision of the Supreme Court on a reference. Where s. 63(2)(a) of the previous provision required the Board (on a case stated during a proceeding) to "reserve its decision until the opinion of the final court of appeal has been given," s. 64(3)(a) of the present Act requires the Board to do so "until the opinion of the Supreme Court has been given," at which point s. 64(3)(b) requires it to "decide the appeal in accordance with the opinion." As will become apparent, I see in this provision the intention of the Legislature to draw a distinction between the roles of the two new sections, to provide the Board with two complementary paths for seeking the Supreme Court's opinion on a question of law. [9] The provision for appeal from a decision of the Supreme Court on a question of law in the old s. 63(8) was not continued in the new s. 64. As the old s. 63(3) providing for an appeal became the new s. 65(1) and the old s. 64 became the new s. 65(10), so the old s. 63(8) became the new s. 65(9), but with one difference. [10] The new s. 65(10), providing for the implementation of the final court opinion on an appeal includes the words "under this section," as does the new s. 65(8), a costs provision not found in the old Part 8. The new 65(9) providing for an appeal to the Court of Appeal from a decision of the Supreme Court does not include this qualification. [11] In the absence of the words "under this section" in s. 65(9), the Respondent finds justification for the position that an appeal lies with leave from a decision of the Supreme Court to the Court of Appeal, whether that decision is made on a reference under s. 64 or on an appeal under s. 65. It sees this reading of s. 65(9) to be in accordance with the Legislature's desire for efficiency. In the Respondent's view, to adopt the Assessor's understanding of ss. 64 and 65 would be to "require the parties to go to the Supreme Court twice in order to seek leave to appeal the first decision of the Supreme Court." He sees this proceeding as illustrative of the problem. [12] The Respondent appealed the 2004 assessment of property it leases from Canada Housing and Mortgage Corporation on Granville Island, as it had the 2002 and 2003 assessments. For procedural reasons, it had not appealed the Board's decision given in that appeal: Arts Umbrella v. Area 09, 2004 PAABBC At the parties' request, the Board stated a case on two questions of law pursuant to s. 64 on the basis of the facts of its prior decision before rendering a final decision on the 2004 assessment appeal. The questions were whether the Respondent comes within the expression "non-profit fraternal organization" and its facilities within the term "meeting hall" as used in s. 8 of B.C. Reg. 438/81 made under the Act. By asking these questions, the Assessor ultimately seeks to have this Court revisit or distinguish its decisions in Union Club of British Columbia v. British Columbia Assessor of Area #01 (1993), 85 B.C.L.R. (2d) 167 (C.A.), and Chamber of Commerce v. Burnaby/New Westminster Assessor Area No. 10 (1993), 85 B.C.L.R. (2d) 175 (C.A.). [13] Applying those authorities, Morrison J. answered both questions "Yes" (2006 BCSC 253). Subsequently, the Board rendered a final decision in accordance with her opinion: Children's Arts Umbrella v. Area 09, 2006 PAABBC Meanwhile, the Assessor filed an application for leave to appeal Morrison J.'s decision. The Assessor then requested the Board to state a case from its final decision under s. 65. That case has been filed in the Supreme Court under registry file number L It remains to be decided. However, it is likely the chambers judge who hears the Stated Case will adopt the opinion of Morrison J., as Brenner C.J.S.C. adopted the reasons of Drost J. in similar circumstances in Talbot. Then, it is not disputed the Assessor will be able to seek leave to appeal from that decision under s. 65(9) from a justice of this Court. [14] The Assessor acknowledges that, with the benefit of hindsight and further consideration, given the purpose of this appeal, the parties could (and perhaps should) have sought a final decision from the Board rather than a reference during the proceeding. Nevertheless, he seeks directions as to whether an appeal is possible from the opinion Morrison J. gave on the reference under s. 64(1) in this case. While in some cases the answer to a question of law on a reference may totally resolve the assessment appeal, as seems likely in this case, in others it will not. page 13

14 [15] The point raised by this application has not been judicially considered, although this Court has considered appeals with leave from opinions of the Supreme Court given in two cases (of 84 stated under s. 64), without challenge or comment: Annacis Auto Terminals (1997) Ltd. v. British Columbia (Assessor of Area No. 11- Richmond/Delta) (2003), 227 D.L.R. (4th) 476, 2003 BCCA 315 ["Annacis" hereinafter], and Norske Skog Canada Ltd. v. British Columbia (Assessor of Area No. 6 - Courtenay), 2006 BCCA 130 ["Norske Skog" hereinafter]. [16] These decisions suggest some procedural confusion but may simply be a hold-over from the common practice under the old regime. While the decision of this Court in Norske Skog appears to be an appeal from a final decision of the Board dismissing the assessment appeal, the chambers judge noted in the opening paragraph of her reasons (2005 BCSC 794) that Norske Skog was seeking the opinion of the court on two questions of law on "an appeal by way of Stated Case pursuant to s. 64(1)" of the Act, thereby suggesting a reference during a proceeding. This Court held both the chambers judge and the Board had erred in their interpretation of s. 19(11) of the Act, opined as to the correct interpretation and remitted the matter to the Board to afford the Appellant an opportunity to establish the factual circumstance necessary to benefit from the Court's interpretation, in effect treating the appeal as a Stated Case on a reference. [17] By contrast, Annacis has all the hallmarks of an appeal from a final decision of the Board. Yet, both the occupier and the Assessor stated questions for the opinion of the Supreme Court under s. 64(1) as to whether the Board erred in finding it had jurisdiction to reopen the 1999 roll and to hear evidence to determine whether an occupier should be added to it. The chambers judge upheld the Board's jurisdiction, effectively affirming its retroactive assessment of lands owned by the federal Crown of which Annacis was the occupier. On an appeal to this Court with leave, the majority disagreed, finding error on the part of both the chambers judge and the Board. [18] As I indicated earlier in these reasons, I am of the view ss. 64 and 65 play distinctive roles in the revised assessment appeals system. The role of s. 64 is to permit the Board to obtain the advice of the Supreme Court on a question of law during the proceedings to assist it in coming to a final decision. In that advisory role s. 64 gives no part to the Court of Appeal directly or by implication. I see the change in the wording of s. 64(3) as decisive that no Court of Appeal role was intended. That change persuades me the Legislature did not contemplate the Board staying its proceeding, including its final decision until the resolution of an appeal from the decision of the Supreme Court. Rather, it seems to me that, in accordance with its goal of making the process more efficient, the Legislature was seeking to avoid the delay in the Board's proceedings inherent in an appeal from a reference. [19] The role of s. 65 is to provide a complete scheme for an appeal from a final decision of the Board, a decision the Board has no jurisdiction to revisit, except for error identified on appeal. It permits an appeal by Stated Case to the Supreme Court (s. 65(1)), a further appeal with leave to the Court of Appeal (s. 65(9)), an award of costs in both courts (s. 65(8)), and finally, an amendment to the assessment roll (s. 65(10)). [20] This reading creates fewer problems than would the interpretation favoured by the Respondent, giving rise as the reading would, not only to the possibility of two Stated Cases, but also to two appeals from the decisions on those cases, adding to, rather than reducing, the potential for delay in concluding an assessment appeal. It also obviates a problem identified by the Assessor with the interpretation the Respondent puts forward. What happens if the Board makes its final decision after the Supreme Court makes its decision and before the appeal is decided, the Court of Appeal finds error in the Supreme Court's decision, and as required by s. 64(6), remits it to the Board by then functus; and without authority to make a further decision. The statute makes no provision for that circumstance for the likely reason it did not intend there to be an appeal from an opinion given on a reference. [21] The new assessment appeals system can be made to work if counsel and the Board keep clearly in mind the distinction the Legislature has drawn between a reference and an appeal. page 14