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CASUAL LEGAL: Lease, Licence, or Permit: Section 304 and The Assessed Person

August 18, 2020

Lease, Licence, or Permit: Section 304 and The Assessed Person

Alberta Court of Appeal considers SDAB’s variance power in direct control districts

By Emma Banfield

Daina Young, Reynolds Mirth Richards Farmer LLP

AMSC Casual Legal Service Provider


Part 9 of the Municipal Government Act addresses assessment of property. Division 2 of Part 9 addresses a municipality’s assessment roll, and section 304 of Division 2 lists who should be recorded on the assessment roles as the assessed person in respect of an assessed property. The section is designed in columns, with the type of assessed property described in Column 1, and who the properly assessed person is in relation to that land described in Column 2.

Different types of property list different people as the appropriate assessed person. As might be expected, the owner of a parcel of land is often the properly assessed person in relation to that land, and for machinery and equipment, the owner of the machinery and equipment is the properly assessed person. Similarly, the owner of a manufactured home is usually the assessed person on the municipal assessment rolls.

However, for land held under a lease, licence, or permit, it is the holder of the lease, licence, or permit who is the assessed person in relation to the parcel of land and any improvements to the parcel of land made under that lease, licence, or permit. In addition, in relation to linear property, it is the operator of the linear property who should appear as the assessed person on the municipal assessment rolls.

A recent case looked at what kind of lease, licence or permit would make the holder the properly assessed person. In this case, the Court considered who should be listed as the assessed person in relation to property used for food preparation and sales in University buildings and residences should be subject to taxation. The Municipal Government Act exempts from taxation property held by a University Board of Governors and used for educational purposes. In this case, the University had contracted a company to deliver food services, and the City of Edmonton Assessor determined that the property in question, although held by the Board of Governors, was held by the contractor under a lease, licence, or permit, and was not being used for educational purposes. The University appealed this decision and eventually the matter came before the Court of Appeal.

The Court of Appeal decided a contract for food services was not enough to bring the land into the definition of lease, licence, or permit in section 304. Therefore, the University was the properly assessed person. Further, the University was exempt from taxation on this property because the requirement that a service be “necessary and integral” to the provision of education was too restrictive. The Court of Appeal directed the Municipal Government Board to reconsider the decision, bearing in mind that the question was whether the properties were used for the purpose of achieving educational aims in a practical and efficient manner.

In reconsidering its previous decision, and in later Board decisions, the Municipal Government Board has  determined that in fact the University was the correct assessed person under section 304 of the Municipal Government Act, and that a broad interpretation of educational purposes should be used.The Alberta Court of Appeal recently released a decision which confirms the authority of a Subdivision and Development Appeal Board (“SDAB”) when hearing an appeal from a development permit issued by the development authority in a direct control district.

Section 685(4) of Municipal Government Act (previously s. 641(4)(b)) provides that when a development authority makes a decision on a development permit application in a direct control district, the scope of the appeal from the decision to the SDAB is limited: 

… the appeal is limited to whether the development authority followed the directions of council, and if the subdivision and development appeal board finds that the development authority did not follow the directions it may, in accordance with the directions, substitute its decision for the development authority’s decision.

The developer in this case applied for a development permit to construct an apartment dwelling in a direct control district. Council had delegated the ability to make a decision on development permit applications in the direct control district to the development officer.  The development officer refused the development permit application, which was for a discretionary use. 

The developer appealed the development officer’s refusal of the development permit application to the SDAB. The SDAB concluded that the development officer had not followed the directions of council set out in the land use bylaw for the direct control district, and issued a development permit to the developer. In doing so the SDAB relied upon and exercised the general variance power granted to SDABs by s. 687(3) of the Municipal Government Act, which authorizes the issuance of a development permit that does not comply with the requirements of the land use bylaw provided that the SDAB is satisfied that the test for a variance is met; i.e., that the proposed development conforms with the use prescribed in the land use bylaw and would not unduly interfere with the amenities of the neighborhood or materially interfere with or affect the use, enjoyment or value of neighboring parcels of land.

The Court of Appeal agreed with the SDAB’s conclusion that the development officer had not followed the directions of council set out in the land use bylaw for the direct control district. The SDAB was entitled to substitute its own decision, provided that its decision accorded with council’s directions. However, the Court of Appeal found that the SDAB did not have the ability to rely upon the general variance power set out in s. 687(3) of the MGA to vary the requirements of the land use bylaw in the direct control district.

To access AMSC’s Casual Legal Helpline, AUMA members can call toll-free to 1-800-661-7673 or email and reach the municipal legal experts at Reynolds Mirth Richards and Farmer LLP. For more information on the Casual Legal Service, please contact, or call 310-AUMA (2862) to speak to AUMA’s Risk Management staff. Any Regular or Associate member of the AUMA can access the Casual Legal Service.

DISCLAIMER: This article is meant to provide information only and is not intended to provide legal advice. You should seek the advice of legal counsel to address your specific set of circumstances. Although every effort has been made to provide current and accurate information, changes to the law may cause the information in this article to be outdated.