Property assessors with the BC Assessment Authority and the Property Assessment Appeal Board  (the "Board") are not typically bound by precedent in the same manner as are courts.  However, if an assessor or the Board interprets the Assessment Act and the regulations under this Act inconsistently with their previous interpretation, a court may find their decision to be unreasonable. This principle was recently illustrated in Aspen Planers Ltd. v. Assessor of Area #23, 2015 BCSC 1573. 

The technical question in Aspen was whether certain buildings were separate industrial improvements, or whether they formed part of pre-existing structures.  The answer to this question affected how the buildings were to be valued and, accordingly, how much property tax would be payable. 

Neither the Act nor the regulations specified how to determine whether an improvement was "part of" another improvement.  In decisions preceding Aspen, the Board had used a number of different criteria to make this determination, modifying and restating the test a few times. In Aspen, the Board yet again restated the test, adding as a criterion the evaluation of economic features of a building (i.e., whether the new improvement could fulfill its economic function if the original structure was disassembled). Using the revised test, the Board concluded that the buildings were separate industrial improvements.

Aspen appealed the Board's decision as unreasonable, pointing out that if the Board was free to change the test at whim, property owners could not have confidence that they were aware of what factors were important if they wished to challenge the assessment.  The Court agreed, holding that inconsistency in the Board's interpretation of the Assessment Act and the regulations can suggest that the Board's decision is unreasonable.

Ultimately, the Court found that the Board was unreasonable in adding economic function of a building as a criterion of the test.  At least with one of the buildings in question, this addition led to an unreasonable factual conclusion.  Pointedly, the Court stated that:

... it would be advisable for any future Board, should it consider ... a change to the test to ensure the parties had been given a chance to make submissions both on the proposed change, and if that proposed change justifies further evidence.  I am not suggesting that the Board will automatically err if this is not done but apart from ensuring a reasonable application of the Regulation, procedural fairness must be adhered to and that requires that a party know the case it has to meet when appearing before a tribunal. [para. 90]

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