State Tax Commission of Missouri
LYNN HARTMANN, II)
v.) Appeal Number 07-32546
SCOTT SHIPMAN, ASSESSOR,)
ST. CHARLES COUNTY,MISSOURI,)
AFFIRMING HEARING OFFICER DECISION
UPON APPLICATION FOR REVIEW
On January 10, 2008, Hearing Officer Maureen Monaghan entered her Decision and Order (Decision) affirming the assessments by the St. Charles County Board of Equalization and setting the true value in money for the property under appeal at $469,540, residential assessed value of $89,210.
Complainant timely filed their Application for Review of the Decision. Respondent filed a Response to Complainant’s Application for Review.
CONCLUSIONS OF LAW
Standard Upon Review
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.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).
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.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).
The Commission will not lightly interfere with the Hearing Officer’s Decision and substitute its judgment on the credibility of witnesses and weight to be given the evidence for that of the Hearing Officer as the trier of fact.Black v. Lombardi, 970 S.W.2d 378 (Mo. App. E.D. 1998); Lowe v. Lombardi, 957 S.W.2d 808 (Mo. App. W.D. 1997); Forms World, Inc. v. Labor and Industrial Relations Com’n, 935 S.W.2d 680 (Mo. App. W.D. 1996); Evangelical Retirement Homes v. STC, 669 S.W.2d 548 (Mo. 1984); Pulitzer Pub. Co. v. Labor and Indus. Relations Commission, 596 S.W.2d 413 (Mo. 1980); St. Louis County v. STC, 562 S.W.2d 334 (Mo. 1978); St. Louis County v. STC, 406 S.W.2d 644 (Mo. 1966).
A review of the record in the present appeal provides support for the determinations made by the Hearing Officer.There is competent and substantial evidence to establish a sufficient foundation for the Decision of the Hearing Officer.A reasonable mind could have conscientiously reached the same result based on a review of the entire record. The Commission finds no basis to support a determination that the Hearing Officer acted in an arbitrary or capricious manner or abused his discretion as the trier of fact and concluder of law in this appeal.Hermel, Inc. v. STC, 564 S.W.2d 888 (Mo. 1978); Black v. Lombardi, 970 S.W.2d 378 (Mo. App. E.D. 1998); Holt v. Clarke, 965 S.W.2d 241 (Mo. App. W.D. 1998); Smith v. Morton, 890 S.W.2d403 (Mo. App. E.D. 1995).Phelps v. Metropolitan St. Louis Sewer Dist., 598 S.W.2d 163 (Mo. App. E.D. 1980).
Complainant’s, Lynn Hartmann II, letter setting forth the basis for the Application for Review presented five grounds for the appeal of the Hearing Officer’s Decision.Complainant failed to set forth any legal claim or basis as a ground to find the Hearing Officer had abused her discretion or acted in an arbitrary or capricious manner.Complainant simply disagreed with the conclusions and determinations reached by the Hearing Officer and had an opinion as to the fair market value of the property different from that determined by the Hearing Officer.In other words, Complainant failed to state any specific legal grounds upon which it was claimed the decision was erroneous.In the absence of specific facts of error or specific errors in applying the law, the Application for Review must be summarily denied.
Mr. Hartmann raised the following points in his Application for Review:
1. Complainant’s Appraisal Report that determined a value of $398,750.
2. The builder is selling homes in his subdivision and, according to the Complainant, dropped the price from September 2006 to September 2007.
3. His appraiser was not allowed to represent Complainant at the hearing.
4. The Assessor’s employee should not have used two comparables by the same developer.
5. According to the Complainant, real estate values in the last months of 2006 decreased.
Complainant’s points 1, 2, 4 and 5 concern the appraisal reports completed by his appraiser and the county’s appraiser and the market for homes inSt. CharlesCountyin 2006 and 2007.In his first and fourth point, Complainant argues in his request for rehearing that his appraiser’s report indicated a value of $398,750 and that the Assessor’s Report should not have used properties by the same builder.Both reports were accepted into evidence and reviewed by the Hearing Officer and discussed in her Decision pages 6-7.It is noted that Complainant’s appraiser also used sales within the neighborhood and the properties used by the appraiser which were outside of the neighborhood required the most adjustments and therefore are least comparable to the subject property.
In points two and five, Complainant argues that real estate values in the last months of 2006 decreased and that the prices in his subdivision have dropped.The Hearing Officer addressed the market in her opinion and discussed that the Complainant’s appraiser made adjustments to his comparables for size of the lots, square footage of the improvement, basement finish, and additional improvements such as decks.However, the appraiser did not make any adjustment for the date of the sales which occurred from nine months prior to the tax date of January 1, 2007, to eleven months after the tax date.The appraiser did not make an adjustment for time or present evidence that a time adjustment for properties selling as early as March 2006 and as late as November 2007 was necessary or warranted by the market.
In point three, Complainant states that the Hearing Officer led him to believe that his appraiser would be “his representative and testify on [his] behalf.”The appraiser for the Complainant testified at the hearing and his appraiser’s report was admitted into evidence.The Complainant was allowed to consult with his appraiser during the hearing including the cross-examination of the County’s appraiser.The appraiser was not permitted to act as legal counsel for Complainant.
The “practice of the law” is defined as the appearance as an advocate in a representative capacity or the performance of any act in such capacity in connection with proceedings pending or prospective before any court of record, commissioner, referee or any body, board, committee or commission constituted by law or having authority to settle controversies.Section 484.010, RSMo.Pursuant to Section 484.020, RSMo:
“1. No person shall engage in the practice of law or do law business, as defined in section 484.010, or both, unless he shall have been duly licensed therefor and while his license therefor is in full force and effect, … 2. Any person,… who shall violate the foregoing prohibition of this section shall be guilty of a misdemeanor and upon conviction therefor shall be punished by a fine not exceeding one hundred dollars and costs of prosecution and shall be subject to be sued for treble the amount which shall have been paid him or it for any service rendered in violation hereof ….”
The Hearing Officer properly allowed the appraiser to present his appraisal and allow the Complainant to consult with his appraiser during the hearing.The Hearing Officer did not permit the appraiser to practice law in violation of Section 484.020, RSMo.
The Hearing Officer did not err in her determinations as challenged by Complainants. A review of the points now raised by Mr. Hartmann and the evidence presented in the record in this appeal presents no basis for overturning the Decision.The Commission finds nothing in the
evidentiary record or in the points raised in the Application for Review which would support overturning or modifying the decision of the Hearing Officer.
The Commission upon review of the record and Decision in this appeal, finds no grounds upon which the Decision of the Hearing Officer should be reversed or modified.Accordingly, the Decision is affirmed.
Judicial review of this Order may be had in the manner provided in Sections 138.432 and 536.100 to 536.140, RSMo within thirty days of the date of the mailing of this Order.
If judicial review of this decision is made, any protested taxes presently in an escrow account in accordance with this appeal shall be held pending the final decision of the courts.If no judicial review is made within thirty (30) days, this decision and order is deemed final and the Collector of St. Charles County, as well as the collectors of all affected political subdivisions therein, shall disburse the protested taxes presently in an escrow account in accord with the decision on the underlying assessment in this appeal.
SO ORDERED March 12, 2008.
STATE TAX COMMISSION OFMISSOURI
Bruce E. Davis, Chairman
Jennifer Tidwell, Commissioner
Charles Nordwald, Commissioner
DECISION AND ORDER
Decision of the St. Charles County Board of Equalization sustaining the assessment made by the Assessor, AFFIRMED, Hearing Officer finds true value in money for the subject property for tax years 2007 to be $469,540, assessed value of $89,210 as residential.
Complainant appeared pro se.
Respondent appeared by Counsel, Charissa Mayes, Assistant County Counselor.
Case heard and decided by Hearing Officer Maureen Monaghan.
The Commission takes this appeal to determine the true value in money for the subject property on January 1, 2007.
Complainant appeals, on the ground of overvaluation, the decision of the St. Charles County Board of Equalization, which sustained the valuation of the subject property.The Assessor determined an appraised value of $469,540, assessed value of $89,210, as residential property.Complainant proposed a value of $400,000, assessed value of $76,000.A hearing was conducted on January 8, 2008, at theSt. CharlesCountyAdministrationBuilding,St. Charles,Missouri.
The Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
The following exhibits were offered into evidence on behalf of the Complainant.
Exhibit A –Appraisal report by Thomas Castor.
Exhibit B1-4 – Property Records
Exhibit A was received into evidence.Respondent objected to Exhibit B.Objection was sustained.
Testimony of Lynn Hartmann, II.
Testimony of Thomas W. Castor
The following exhibits offered into evidence on behalf of the Respondent.
Exhibit 1 – Appraisal of Subject Property
All Exhibits were received into evidence.
Testimony of Teresa Kruep
FINDINGS OF FACT
1.Jurisdiction over this appeal is proper.Complainant timely appealed to the State Tax Commission from the decision of the St. Charles County Board of Equalization.
2.The subject property is located at315 Peruque Ridge Court,Wentzville,Missouri.The property is identified by locator number T052200208.The property consists of a .87 acre lot improved by a brick and vinyl one-story ranch, single-family structure of average quality condition.The residence has a total of eight rooms, which includes three bedrooms and two and a half baths and contains 2,741 square feet of living area.There is a full walk out basement with a bath and bar and an attached three car garage.The home was built in 2006 and the property was purchased after completion by the Complainant on December 26, 2006.
3.Improvements to the property in 2007 include landscaping and a deck.
4.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 $400,000.
5.Respondent’s appraisal was accepted only to sustain the assessment made by the Assessor and sustained by the Board and not for the purpose of raising the assessment above that value.
CONCLUSIONS OF LAW and DECISION
The Commission has jurisdiction to hear this appeal and correct any assessment which is shown to be unlawful, unfair, arbitrary or capricious.Article X, section 14, Mo. Const. of 1945; Sections 138.430, 138.431, RSMo.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.Section 138.431.4, RSMo.
Presumptions on Assessments
There is a presumption of validity, good faith and correctness of assessment by the CountyBoardof Equalization.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).
TheSupreme Court of Missouri has held, “A tax assessor’s valuation is presumed correct.”Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W.3d 341 (Mo. 2005).Citing to Hermel, supra; and Cupples Hesse Corp. v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).
The presumption of correct assessment is rebutted when the taxpayer presents substantial and persuasive evidence to establish that the assessor’s or Board’s valuation is erroneous and what the fair market value should have been placed on the property.Snider, Hermel & Cupples Hesse, supra.
Complainants’ evidence failed to rise to the level of substantial and persuasive necessary to rebut the presumptions of corrects assessment in the assessing officials.
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.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).It is the fair market value of the subject property on the valuation date.Hermel, supra.
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 is 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 each 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.
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.
Complainant’s Burden of Proof
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.Hermel, Inc. v. State Tax Commission, 564 S.W.2d 888, at 897.Substantial evidence can be defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.See, Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).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.Brooks v. General Motors Assembly Division, 527 S.W.2d 50, 53 (Mo. App. 1975).See also, 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).
The owner of property is generally held competent to testify to its reasonable market value. Boten v. Brecklein, 452 S.W.2d 86, 95 (Sup. 1970).The owner’s opinion is without probative value however, where it is shown to have been based upon improper elements or an improper foundation.Shelby County R-4 School District v. Hermann, 392 S.W.2d 609, 613 (Sup. 1965).
Complainant presented the testimony of a certified residential appraiser.The appraiser used cost and sales comparison approach to determine value of the subject property of $398,750.The appraiser determined a value of $417,683 ($80,000 land, $337,683 improvements) using the cost approach and a value of $398,750 using the sales comparison approach.
The appraiser compared the subject property with six other properties within 1.27 miles of the subject property that sold at $340,000 to $403,955 from March 2006 to November 2007.Adjustments were made to the comparables for the differences from the subject property including size of the lots, square footage of the improvement, basement finish, and additional improvements such as decks.The net adjustments ranged from 1.6% to 13.7% and gross adjustments ranged from 7% to 16.2%.
The appraiser did not make any adjustment for the date of the sales which occurred from nine months prior to the tax date of January 1, 2007, to eleven months after the tax date.Complainant’s own appraiser decided that time adjustments were not necessary for sales in this time period, and such a decision counters Complainant’s argument that the market was rapidly declining.
Additionally, the subject property is located in a neighborhood of predominantly brand new brick and frame homes with values ranging from $320,000 to $600,000 with an average sale price of $450,000.This fact in combination with evidence as a whole support the value of $469,540 for the subject property determined by the Hearing Officer and provides no basis for overturning the decision.
Summary and Conclusion
Having failed to meet their burden of proof, the value determined by the Assessor which was sustained by the Board is affirmed.
Evidence of Increase in Value
In any case in St. Charles County where the assessor presents evidence which indicates a valuation higher than the value finally determined by the assessor or the value determined by the board of equalization, whichever is higher, for that assessment period, such evidence will only be received for the purpose of sustaining the assessor’s or board’s valuation, and not for increasing the valuation of the property under appeal.Section 138.060, RSMo; 12 CSR 30-3.075.The Kruep appraisal report presented substantial and persuasive evidence to support the value established by the Board of $469,540.
The assessed valuation for the subject property as determined by the Assessor and sustained by the Board of Equalization forSt. CharlesCountyfor the subject tax day is AFFIRMED.
The assessed value for the subject property for tax year 2007 is set at $89,210 as residential.
A party may file with the Commission an application for review of this decision within thirty (30) days of the mailing of such decision.The application shall contain specific grounds upon which it is claimed the decision is erroneous.Failure to state specific facts or law upon which the appeal is based will result in summary denial.Section 138.432, RSMo 2000.
If an application for review of this decision is made to the Commission, any protested taxes presently in an escrow account in accordance with this appeal shall be held pending the final decision of the Commission.If no application for review is received by the Commission within thirty (30) days, this decision and order is deemed final and the Collector of St. Charles County, as well as the collectors of all affected political subdivisions therein, shall disburse the protested taxes presently in an escrow account in accord with the decision on the underlying assessment in this appeal.If any or all protested taxes have been disbursed pursuant to Section 139.031(8), RSMo, either party may apply to the circuit court having jurisdiction of the cause for disposition of the protested taxes held by the taxing authority.
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 January 15, 2008.
STATE TAX COMMISSION OFMISSOURI