43 years of government abuse and intransigence

Opinion

Hey there, time traveller!
This article was published 23/09/2023 (748 days ago), so information in it may no longer be current.

“The right of all people to fair treatment by government is a fundamental human right.”

Gregory J. Levine, Ph.D., LL.B., Barrister and Solicitor, author, lecturer and speaker on governmental ethics laws.

“It’s a cautionary tale on why all levels of government must be held to account,” began a Free Press editorial about injustices inflicted upon my late father Jack Perrin (1915-1992) and our family related to our ownership of the Fort Garry Hotel in the 1980s. We were subjected to a uniquely and grossly excessive property tax assessment imposed by the City of Winnipeg and an abject failure of the province’s assessment and appeal system.

A recent letter from justice minister Kelvin Goertzen had revealed that a review confirmed we were dealt with unfairly, but assigned blame to the city and exonerated the province. Both levels of government are responsible, however, and as the editorial stresses both should be held to account.

Our story begins in November 1979. We had acquired from CNR the hotel and the adjacent lands now containing Fort Garry Place and Rideau Towers. The total price was $2.3 million ($9 million or more today). The hotel building was valued at $100,000 and the land under the hotel at $800,000. We did not know what the taxes would be since CNR, a Crown corporation, paid a grant in lieu of taxes. But we did know we were entitled, like everyone else, to a fair and just assessment with an opportunity to appeal if necessary. As events unfolded, however, the city assessed the hotel building alone at approximately $10 million and took steps to prevent all appeals.

After three years the tax arrears on the hotel land and building, with interest and penalties, was $1,066,000, exceeding the $900,000 purchase price. We were being prevented from appealing, could not pay the taxes and were vilified by the city. The adjacent lands, valued at $1.4 million, were lost as a result of tax sale in 1983. In 1987 the city seized the hotel. The city and province petitioned our family company into bankruptcy, and our entire investment of $2.1 million was lost. Having assessed the hotel building alone at $10 million, the city sold the land and building for $834,000, describing it as “a very good deal.”

In 1991 it was determined the assessment on the hotel land and building had been 7.82 times too high, and on the hotel building, 97.34 times. The tax arrears in 1983 should have been about $95,000. We had been vindicated, but were left with no legal recourse nor redress for the injustice.

In the words of the late former Premier Duff Roblin, “It’s a ghastly story, amounting to a denial of natural justice.” The City of Winnipeg imposed a uniquely and grossly excessive assessment, worked to prevent our appeal, and blamed us for the conflict. And the province utterly failed to maintain an assessment and appeal system designed to protect all property owners from this very sort of appalling injustice. The result was calamitous economic and reputational damage to our family that crippled our business, culminating in confiscation of our property and bankruptcy.

How could this happen?

In 1981 a group of downtown businesses appealed their assessments. In response the City of Winnipeg applied to Court of King’s Bench for an order prohibiting all appeals, insisting provincial legislation froze assessments for the entire city. The province, knowing this to be incorrect, failed to intervene. In December 1981 the court issued the order and all assessments were frozen, later upheld by the Manitoba Court of Appeal. Finally, in December 1983 the Supreme Court overturned those decisions, restoring the right to appeal assessments. For us, this decision came after the 1983 tax sale and the loss of our adjacent lands.

Following the tax sale, we retained possession of the hotel itself. Despite the injustices we had endured we remained confident our appeal, to be heard for the first time in 1984, would succeed. During the appeal process, however, the Municipal Board wrongly concluded market value was “not relevant” to assessments. This egregious error in law required us to apply for leave to appeal to the Court of Appeal. The court decided however, at the city’s insistence, that provincial legislation was intended to prevent appeals, even on a point of law.

For us, it was a profoundly shocking ending to our appeal, leaving us with an unjust, grossly excessive, and rapidly growing tax liability. The injustice was later confirmed when the province amended its legislation to ensure a right of appeal on a point of law. And the Court of Appeal in 1987 decided market value was the only basis for assessments. And in 1991 came the decision that the original assessment on the hotel building had been 97.34 times too high.

The historic accountability for this “ghastly story” lies with the provincial NDP government of Premier Howard Pawley (1981-1988) and the city administration of Mayor Bill Norrie (1979-1992) and Chief Commissioner Nick Diakiw (1978-88). In 1999 we had appealed to the Manitoba Ombudsman. We were advised there was “no doubt we had been aggrieved” but our only recourse was to political leadership. Over the ensuing years, the injustice has been compounded by the failure of premiers, cabinet ministers, deputy ministers and mayors to respond fairly, or at all, to our family’s repeated appeals.

“We all expect government… to act in a fair, open, and transparent manner”, declares the ombudsman website. In sharp contrast, we have not seen the review report summarized in Kelvin Goertzen’s letter. Nor were we consulted by the reviewer appointed by the Department of Justice, whose independence remains questionable and identity a secret. We remain grateful to the minister for requesting an independent review. But both the review process and the reported assigning of blame solely to the city are obviously unfair and unjust.

Unfairness in our story has, however, at long last been acknowledged by a justice minister. After 43 years, our appeal continues.

We are hopeful the current generation of provincial and civic leaders will have the conscience and take the time to do the right thing.

John Perrin is the eldest of Jack Perrin’s children and worked in the hotel with his father.