Jay Cohen v. Brooks (SLCO)

March 11th, 2010

State Tax Commission of Missouri




Complainant, )


v. ) Appeal Number 08-10068





Respondent. )






Decision of the St. Louis County Board of Equalization sustaining the assessment made by the Assessor is SET ASIDE. True value in money for the subject property for tax year 2008 is set at $195,000, commercial assessed value of $62,400. Complainant appeared in person and by Counsel, Harvey I. Feldman. Respondent appeared by Associate County Counselor, Paula J. Lemerman.

Case heard and decided by Senior Hearing Officer W. B. Tichenor.


Complainant appeals, on the ground of overvaluation, the decision of the St. Louis County Board of Equalization, which sustained the valuation of the subject property. The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2007. The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.


1. Jurisdiction. Jurisdiction over this appeal is proper. Complainant timely appealed to the State Tax Commission from the decision of the St. Louis County Board of Equalization. A hearing was conducted on January 28, 2010, at the St. Louis County Government Center, Clayton, Missouri.[1]

2. Assessment. The Assessor valued the property at $206,700, a commercial assessment of $66,140. The Board of Equalization sustained that value.[2]

3. Subject Property. The subject property is located at 14389 Manchester Road, Manchester, Missouri. The property is identified by parcel number 23Q430666. The property consists of a 12,000 square feet, (.28 acre) lot. The property is improved by a one-story brick office structure built in 1963, containing 1,537 square feet. There is 5,900 square feet of asphalt paved parking. The building is occupied by two tenants.[3]

4. Complainant’s Evidence. Complainant offered the following exhibits into evidence.





Summary Appraisal – Ernest A. Demba – $145,500



Written Direct Testimony – Mr. Demba



Mr. Demba concluded an indicated value of $180,500 under the sales comparison approach[4] to value and a value of $110,000 relying on the income approach[5] to value. The appraiser’s final opinion of value was $145,500.[6]

There was no evidence of new construction and improvement from January 1, 2007, to January 1, 2008, therefore the assessed value for 2007 remains the assessed value for 2008.[7]

Complainant’s evidence was not substantial and persuasive to rebut the presumption of correct assessment by the Board and establish the true value in money as of January 1, 2007, to be $145,500, as proposed. See, Respondent Proves Value, infra.

5. Respondent’s Evidence. Respondent offered the following exhibits into evidence.





Summary Appraisal – Albert A. Lincoln – $195,000



Written Direct Testimony – Mr. Lincoln



Mr. Lincoln concluded an indicated value of $254,700 under the cost approach,[8] a value of $195,000 utilizing the sales comparison approach[9] to value and a value of $226,800 relying on the income approach[10] to value. The appraiser’s final opinion of value was $195,000.[11]

Respondent’s evidence was substantial and persuasive to rebut the presumption of correct assessment by the Board and establish the true value in money as of January 1, 2007, to be $195,000, as proposed. See, Respondent Proves Value, infra.

6. True Value in Money. The property under appeal is valued for the 2008 assessment as of January 1, 2007, under the two-year assessment cycle.[12] The true value in money of the subject property as of January 1, 2007, was $195,000, a commercial assessed value of $62,400.[13]



The Commission has jurisdiction to hear this appeal and correct any assessment which is shown to be unlawful, unfair, arbitrary or capricious. The hearing officer shall issue a decision and order affirming, modifying or reversing the determination of the board of equalization, and correcting any assessment which is unlawful, unfair, improper, arbitrary, or capricious.[14]

Presumptions In Appeals

There is a presumption of validity, good faith and correctness of assessment by the County Board of Equalization.[15] The presumption in favor of the Board is not evidence. A presumption simply accepts something as true without any substantial proof to the contrary. In an evidentiary hearing before the Commission, the valuation determined by the Board, even if simply to sustain the value made by the Assessor, is accepted as true only until and so long as there is no substantial evidence to the contrary. The presumption of correct assessment is rebutted when the taxpayer, or respondent when advocating a value different than that determined by the Board, presents substantial and persuasive evidence to establish that the Board’s valuation is erroneous and what the fair market value should have been placed on the property.[16] Complainant’s evidence failed to meet the required standard to rebut the presumption of correct assessment. Respondent’s evidence was substantial and persuasive to rebut the presumption of correct assessment and establish the true value in money as of January 1, 2007.

Standard for Valuation

Section 137.115, RSMo, requires that property be assessed based upon its true value in money which is defined as the price a property would bring when offered for sale by one willing or desirous to sell and bought by one who is willing or desirous to purchase but who is not compelled to do so.[17] True value in money is defined in terms of value in exchange and not value in use.[18] It is the fair market value of the subject property on the valuation date.[19] Market value is the most probable price in terms of money which a property should bring in competitive and open market under all conditions requisite to a fair sale, the buyer and seller, each acting prudently, knowledgeable and assuming the price is not affected by undue stimulus.

Implicit in this definition are the consummation of a sale as of a specific date and the passing of title from seller to buyer under conditions whereby:

1. Buyer and seller are typically motivated.


2. Both parties are well informed and well advised, and both acting in what they consider their own best interests.


3. A reasonable time is allowed for exposure in the open market.


4. Payment is made in cash or its equivalent.


5. Financing, if any, is on terms generally available in the Community at the specified date and typical for the property type in its locale.


6. The price represents a normal consideration for the property sold unaffected by special financing amounts and/or terms, services, fees, costs, or credits incurred in the transaction.[20]


Complainant Fails To Prove Value

In order to prevail, Complainant must present an opinion of market value and substantial and persuasive evidence that the proposed value is indicative of the market value of the subject property on January 1, 2007.[21] There is no presumption that the taxpayer’s opinion is correct. The taxpayer in a Commission appeal still bears the burden of proof. The taxpayer is the moving party seeking affirmative relief. Therefore, the Complainant bears the burden of proving the vital elements of the case, i.e., the assessment was “unlawful, unfair, improper, arbitrary or capricious.”[22]

Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.[23] Persuasive evidence is that evidence which has sufficient weight and probative value to convince the trier of fact. The persuasiveness of evidence does not depend on the quantity or amount thereof but on its effect in inducing belief.[24]

The Hearing Officer is not bound by any single formula, rule or method in determining true value in money, but is free to consider all pertinent facts and estimates and give them such weight as reasonably they may be deemed entitled. The relative weight to be accorded any relevant factor in a particular case is for the Hearing Officer to decide.[25] The Hearing Officer as the trier of fact may consider the testimony of an expert witness and give it as much weight and credit as he may deem it entitled to when viewed in connection with all other circumstances. The Hearing Officer is not bound by the opinions of experts who testify on the issue of reasonable value, but may believe all or none of the expert’s testimony and accept it in part or reject it in part.[26]

Proper methods of valuation and assessment of property are delegated to the Commission. It is within the purview of the Hearing Officer to determine the method of valuation to be adopted in a given case.[27] Missouri courts have approved the comparable sales or market approach, the cost approach and the income approach as recognized methods of arriving at fair market value.[28]

The Hearing Officer finds that the opinion of value presented by the Demba appraisal is not persuasive in light of the appraisal report of Mr. Lincoln. As addressed below, Respondent’s evidence met the required standard to establish the true value in money for Complainant’s property, the tendered value of the Demba appraisal was rebutted by Respondent’s evidence.

Respondent Proves Value

Respondent, when advocating a value different from that determined by the original valuation or a valuation made by the Board of Equalization, must meet the same burden of proof to present substantial and persuasive evidence of the value advocated as required of the Complainant under the principles established by case law.[29] Mr. Lincoln developed the cost approach for valuation of the subject property. In so doing, he arrived at a land value for the subject property of $210,000 based on the sales of three properties located in close proximity to the subject. This evidence of value went unchallenged by Complainant, since Mr. Demba did not do an analysis of the subject’s land value.[30]

Based upon the land sales data and analysis and the sales comparison approach, Mr. Lincoln concluded the following:

“Based upon my analysis of the comparable sales in relation to the subject property, all comparables were weighted equally. Office space generally needs a building ratio of 3 or 3.5 to 1 for tenant/client parking. All comparables are within an acceptable land to building ratio. The subject property is mis-improved and underutilized with a land to building ratio of 7.8 to 1. As a result the most probably sale will be at or near land cost minus the cost of demolition and removal. $17.50 x 12,000 – $210,000 – $10,000 demolition = $200,000.”[31]


The sales comparison analysis yielded an indicated value of only $184,400. Mr. Lincoln’s income approach resulted in a value based upon the capitalized income stream of only $121,800. Mr. Demba’s sales comparison approach established a value of only $180,500. The Demba capitalize income stream only supported a value of $125,000.[32] The land sales presented by Mr. Lincoln, established a per square foot range of $11.06, $19.31 and $21.89, thus producing a median of $19.31 and a mean of $17.42. The conclusion of Mr. Lincoln of a land value of $17.50 per square foot is supported by the evidence.

The indicated income approach values of Mr. Lincoln and Mr. Demba fall only $3,200 apart, not accounting for the excess land, not required to support the current improvement. The income stream does not support the land value, less cost for demolition of the improvements. The highest potential sale price for the subject as of January 1, 2007 would have been a sale for future development with demolition of the improvements. The conclusion of value of $195,000 tendered by Mr. Lincoln is founded upon substantial and persuasive evidence.


The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization for St. Louis County for the subject tax day is SET ASIDE.

The assessed value for the subject property for tax year 2008 is set at $62,400.

Application for Review

A party may file with the Commission an application for review of this decision within thirty days of the mailing date set forth in the Certificate of Service for this Decision. The application shall contain specific facts or law as grounds upon which it is claimed the decision is erroneous. Said application must be in writing addressed to the State Tax Commission of Missouri, P.O. Box 146, Jefferson City, MO 65102-0146, and a copy of said application must be sent to each person at the address listed below in the certificate of service.

Failure to state specific facts or law upon which the appeal is based will result in summary denial. [33]

Disputed Taxes

The Collector of St. Louis County, as well as the collectors of all affected political subdivisions therein, shall continue to hold the disputed taxes pending the possible filing of an Application for Review, unless said taxes have been disbursed pursuant to a court order under the provisions of Section 139.031.8, RSMo.

Any Finding of Fact which is a Conclusion of Law or Decision shall be so deemed. Any Decision which is a Finding of Fact or Conclusion of Law shall be so deemed.

SO ORDERED March 11, 2010.





W. B. Tichenor

Senior Hearing Officer




Certificate of Service


I hereby certify that a copy of the foregoing has been mailed postage prepaid on this 11th day of March, 2010, to: Harvey Feldman, 9666 Olive Blvd., Suite 395, St. Louis, MO 63132, Attorney for Complainant; Paula Lemerman, Associate County Counselor, Attorney for Respondent; Philip Muehlheausler, Assessor; John Friganza, Collector, County Government Center, 41 South Central Avenue, Clayton, MO 63105.




Barbara Heller

Legal Coordinator




[1] Hearing was originally scheduled for September 22, 2009. Complainant failed to appear. Testimony of Respondent’s appraiser was taken and Exhibits 1 and 2 were received into evidence at that time. At request of Complainant evidentiary hearing was rescheduled for cross-examination of Complainant’s appraiser and cross-examination of Respondent’s appraiser.


[2] Board of Equalization Decision Letter; Exhibit 1, p. 7.


[3] Exhibit 1, pp. 10-11; Exhibit A, pp. 24-25.


[4] Exhibit A, pp. 36-52.


[5] Exhibit A, pp. 53-62.


[6] Exhibit A, p. 62.


[7] Section 137.115.1, RSMo.


[8] Exhibit 1, pp. 13-19.


[9] Exhibit 1, pp. 20-24.


[10] Exhibit 1, pp. 25-33.


[11] Exhibit 1, p. 34.


[12] Section 137.115.1, RSMo.


[13] $195,000 x .32 = $62,400.


[14] Article X, section 14, Mo. Const. of 1945; Sections 138.430, 138.431, 138.431.4, RSMo.


[15] Hermel, Inc. v. STC, 564 S.W.2d 888, 895 (Mo. banc 1978); Chicago, Burlington & Quincy Railroad Co. v. STC, 436 S.W.2d 650, 656 (Mo. 1968); May Department Stores Co. v. STC, 308 S.W.2d 748, 759 (Mo. 1958).


[16] Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).


[17] St. Joe Minerals Corp. v. State Tax Commission, 854 S.W.2d 526, 529 (Mo. App. E.D. 1993); Missouri Baptist Children’s Home v. State Tax Commission, 867 S.W.2d 510, 512 (Mo. banc 1993).


[18] Daly v. P. D. George Company, et al, 77 SW3d 645, 649 (Mo.App E.D. 2002), citing, Equitable Life Assurance Society v. STC, 852 SW2d 376, 380 (Mo.App. 1993); citing, Stephen & Stephen Properties, Inc. v. STC, 499 S.W.2d 798, 801-803 (Mo. 1973).


[19] Hermel, supra.


[20] Real Estate Appraisal Terminology, Society of Real Estate Appraisers, Revised Edition, 1984; See also, Real Estate Valuation in Litigation, J. D. Eaton, M.A.I., American Institute of Real Estate Appraisers, 1982, pp. 4-5; Property Appraisal and Assessment Administration, International Association of Assessing Officers, 1990, pp. 79-80; Uniform Standards of Professional Appraisal Practice, Glossary.


[21] Hermel, supra.


[22] See, Westwood Partnership v. Gogarty, 103 S.W.3d 152 (Mo. App. E.D. 2003); Daly v. P. D. George Co., 77 S.W.3d 645 (Mo. App. E.D. 2002); Reeves v. Snider, 115 S.W.3d 375 (Mo. App. S.D. 2003). Industrial Development Authority of Kansas City v. State Tax Commission of Missouri, 804 S.W.2d 387, 392 (Mo. App. 1991).


[23] See, Cupples-Hesse, supra.


[24] Brooks v. General Motors Assembly Division, 527 S.W.2d 50, 53 (Mo. App. 1975).


[25] St. Louis County v. Security Bonhomme, Inc., 558 S.W.2d 655, 659 (Mo. banc 1977); St. Louis County v. STC, 515 S.W.2d 446, 450 (Mo. 1974); Chicago, Burlington & Quincy Railroad Company v. STC, 436 S.W.2d 650 (Mo. 1968).


[26] St. Louis County v. Boatmen’s Trust Co., 857 S.W.2d 453, 457 (Mo. App. E.D. 1993); Vincent by Vincent v. Johnson, 833 S.W.2d 859, 865 (Mo. 1992); Beardsley v. Beardsley, 819 S.W.2d 400, 403 (Mo. App. 1991); Curnow v. Sloan, 625 S.W.2d 605, 607 (Mo. banc 1981).


[27] See, Nance v. STC, 18 S.W.3d 611, at 615 (Mo. App. W.D. 2000); Hermel, supra; Xerox Corp. v. STC, 529 S.W.2d 413 (Mo. banc 1975).


[28] St. Joe Minerals Corp. v. STC, 854 S.W.2d 526, 529 (App. E.D. 1993); Aspenhof Corp. v. STC, 789 S.W.2d 867, 869 (App. E.D. 1990); Quincy Soybean Company, Inc., v. Lowe, 773 S.W.2d 503, 504 (App. E.D. 1989), citing Del-Mar Redevelopment Corp v. Associated Garages, Inc., 726 S.W.2d 866, 869 (App. E.D. 1987); and State ex rel. State Highway Comm’n v. Southern Dev. Co., 509 S.W.2d 18, 27 (Mo. Div. 2 1974).


[29] Hermel, Cupples-Hesse, Brooks, supra.


[30] The Demba appraisal did not include a cost approach to value, therefore no separate land value was determined and presented on behalf of Complainant.


[31] Exhibit 1, pp. 21 & 34.


[32] The additional deduction of $15,000 by Mr. Demba based upon his speculation that a potential purchaser would need to make “immediate repairs” to the paving is not supported by the record. See, Decision – STC Appeal 08-10067 – discussion on why this type of adjustment was not warranted.


[33] Section 138.432, RSMo.