Decision Date: July 17, 1998
Panel: Toby Vigod, Robin Ceasar, Katherine Lewis
Keywords: Forest Act – s. 105; Coast Appraisal Manual – ss. 1.4, 1.6, 2.3.4, 2.3.4(e)(iv), 3, 5.3, 5.5; stumpage adjustment; effective date of a re-determined rate.
This is an appeal of a Review Decision confirming several Stumpage Adjustment Notices, effective June 1, 1997, which were issued to the Appellants by the Director, Revenue Branch, in response to a mathematical error which had been found in the original Notices, effective April 1, 1997. The error was in the calculation of the Coast Mean Value Index (“MVI”) and Coast Base Rate (“BR”): only 11 months of harvest history instead of 12 were used for calculating the MVI. This resulted in the assessed stumpage rates being $0.06 per cubic metre too high. The Revenue Branch corrected the error, reran the stumpage rates using existing data, and issued new Notices with the new effective date.
The Appellants appealed on the grounds that the Branch used the wrong method for correcting the error. They argued that s. 2.3(4) of the Coast Appraisal Manual (“CAM”) requires a stumpage determination containing a mathematical error to be subject to a complete reassessment, using costs and prices in effect at the time of reappraisal, not merely a correction of the error. If this had been done, stumpage rates would have been reduced by several dollars per cubic metre, saving the Appellants between $10 and $20 million depending on the effective date of the correction, which they argue should be April 1, 1997, not June 1, 1997.
The Board found that s. 2.3(4) of the CAM sets up a parallel process for the correction of mathematical errors depending on the source and type of the error. In some cases, the Director, Revenue Branch is notified and corrects the error; in other cases it is the Regional Manager who gets notice and corrects the error. In the case of an error to the MVI or BR, the Board found that the Director, Revenue Branch is responsible for correcting the error and reappraising the cutting authorities using the CAM, in effect on the effective date of the reappraisal, to the extent that he has the authority and capability to do so. It found that the preamble to s. 2.3(4)(e) contemplates different roles for the Revenue Branch and the Regional Appraisal Co-ordinator. As the Director, Revenue Branch has jurisdiction over an error in the MVI and BR, but has no authority or capability to go back to the site-specific level and revisit every piece of information, the Board found that his recalculation of the MVI and BR with the extra month of data, and rerunning of stumpage rates using the information available in the computer, fulfilled the requirements of the CAM.
On the appropriate effective date, the Board found that proper notice of the error was given in accordance with s. 2.3(4) in May of 1997 and, therefore, the effective date of June 1, 1997 was correct. The appeal was dismissed.