STATE TAX COMMISSION OF MISSOURI
| ROBERT & JOANN LIETZ | ) | |
| ) | ||
| Complainants, | ) | |
| ) | ||
| v. | ) | Appeal No. 15-13401 |
| ) | ||
| JAKE ZIMMERMAN, ASSESSOR | ) | |
| ST. LOUIS COUNTY, MISSOURI, | ) | |
| ) | ||
| Respondent. | ) |
ORDER AFFIRMING HEARING OFFICER DECISION
On August 2, 2016, Senior Hearing Officer Amy Westermann issued her order affirming the value placed upon the subject property by the St. Louis County Board of Equalization, finding that Complainants failed to present substantial and persuasive evidence demonstrating market value. Complainants filed an Application for Review of the Decision. Respondent filed a Response. No Reply was filed.
Standard Upon Review
A party subject to a Decision and Order of a Hearing Officer with the State Tax Commission may file an application requesting the case be reviewed by the Commission. The Commission may then summarily allow or deny their request. The Commission may affirm, modify, reverse or set aside the decision. The Commission may take any additional evidence and conduct further hearings.
Complainant’s Application for Review and Points Raised
Complainants filed a multi-page document that was treated as an Application for Review. Pursuant to 138.432 RSMo. “[a] complainant, respondent-assessor, or other party subject to a decision and order of a hearing officer, may file with the commission, within thirty days following the date of notification or mailing of such decision and order, an application to have such decision and order reviewed by the commission. Such application shall contain specific detailed grounds upon which it is claimed the decision is erroneous. …” (emphasis added). Complainants’ filing does not set forth any specific error of the Hearing Officer. Complainants argue that the valuation of the subject property should be lowered because the windows in their basement do not provide egress.
DISCUSSION AND RULING
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).
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).
There is a presumption of validity, good faith and correctness of assessment by the County Board of 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). It places the burden of going forward with some substantial and persuasive evidence squarely on the Complainant. Respondent has no burden to fulfill. The presumption of correct assessment is rebutted if the taxpayer 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. Hermel, supra; Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).
The owner of property is generally held competent to testify to its reasonable market value. Rigali v. Kensington Place Homeowners’ Ass’n, 103 S.W.3d 839, 846 (Mo. App. E.D. 2003); Boten v. Brecklein, 452 S.W.2d 86, 95 (Sup. 1970). However, the owner’s opinion is without probative value where it is shown to have been based upon improper elements or an improper foundation. Cohen v. Bushmeyer, 251 S.W.3d 345, (Mo. App. E.D., March 25, 2008); Carmel Energy, Inc. v. Fritter, 827 S.W.2d 780, 783 (Mo. App. W.D. 1992); State, ex rel. Missouri Hwy & Transp. Com’n v. Pracht, 801 S.W.2d 90, 94 (Mo. App. E.D. 1990); Shelby County R-4 School District v. Hermann, 392 S.W.2d 609, 613 (Sup. 1965). “Where the basis for a test as to the reliability of the testimony is not supported by a statement of facts on which it is based, or the basis of fact does not appear to be sufficient, the testimony should be rejected.” Carmel Energy at 783. A taxpayer does not meet his burden if evidence on any essential element of his case leaves the Commission “in the nebulous twilight of speculation, conjecture and surmise.” See, Rossman v. G.G.C. Corp. of Missouri, 596 S.W.2d 469, 471 (Mo. App. 1980).
Complainants failed to state any facts which tend to demonstrate that the decision of the Hearing Officer was erroneous, arbitrary, capricious, an abuse of discretion, unreasonable or contrary to Missouri law. Complainant did not present substantial and persuasive evidence to rebut the presumption of correct assessment by the BOE. Furthermore, Complainants did not present substantial and persuasive evidence of as to the true market value of the subject property. The Complainants opined that their property value is $248,000 based upon their basement windows not being sufficient size for egress. Photographs were submitted to support their position. The Respondent presented the subject property’s certificate of value. The Complainants purchased their property in August 2014 for $273,000.
Finally, we address Complainant’s assertions that they are “lay-persons” and therefore not qualified to represent themselves. Notwithstanding the foregoing, a review of the record clearly shows that the Hearing Officer afforded the Complainants in this appeal all appropriate courtesies, gave Complainants wide breadth in presenting their case and erred on the side of admitting evidence. We find no error by the Hearing Officer on this point.[i]
ORDER
The Decision and Order of the Hearing Officer, including the findings of fact and conclusions of law is AFFIRMED. It is incorporated by reference, as if set forth herein verbatim, in full, in this final decision of the Commission.
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 mailing date set forth in the Certificate of Service for 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 unless disbursed pursuant to Section 139.031.8, RSMo.
If no judicial review is made within thirty days, this decision and order is deemed final and the Collector of St. Louis 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 this 25th day of October, 2016.
STATE TAX COMMISSION
Bruce E. Davis, Chairman
Victor Callahan, Commissioner
Certificate of Service
I hereby certify that a copy of the foregoing has been sent electronically or mailed postage prepaid this 25th day of October, 2016, to: Complainants(s) counsel and/or Complainants, the county Assessor and/or Counsel for Respondent and county Collector.
Jacklyn Wood
Legal Coordinator
Contact Information for State Tax Commission:
Missouri State Tax Commission
301 W. High Street, Room 840
P.O. Box 146
Jefferson City, MO 65102-0146
573-751-2414
573-751-1341 Fax
[i] The Missouri Court of Appeals has clearly stated that “[p]ro se litigants are held to the same standards as attorneys” and that [j]udicial impartiality, judicial economy, and fairness to all parties preclude courts from granting pro se litigants preferential treatment.” Pruett v. Pruett, 280 S.W.3d 749 (Mo. App. 2009)(internal citations omitted). The Missouri Court of Appeals has also stated that pro se litigants “are entitled to no indulgence they would not have received if represented by counsel.” Morfin v. Werdehausen, 448 S.W. 3d 343 (Mo. App. 2014)(internal citations omitted).
STATE TAX COMMISSION OF MISSOURI
| ROBERT G. LIETZ II & JOANN P. LIETZ, | ) | |
| ) | ||
| Complainants, | ) | |
| ) | ||
| v. | ) | Appeal No. 15-13401 |
| ) | ||
| JAKE ZIMMERMAN, ASSESSOR | ) | |
| ST. LOUIS COUNTY, MISSOURI, | ) | |
| ) | ||
| Respondent. | ) |
DECISION AND ORDER
HOLDING
The assessment made by the Board of Equalization of St. Louis County (BOE) is AFFIRMED. Complainants Robert G. Lietz II and JoAnn P. Lietz did not present substantial and persuasive evidence to rebut the presumption of correct assessment by the BOE. Assessed value in money for the subject property for tax years 2015 and 2016 is set at $51,470 residential ($270,900 true market value or TMV).
Complainant Robert G. Lietz II (Complainant) appeared pro se.
Respondent Jake Zimmerman, St. Louis County Assessor, (Respondent) appeared by Steven Robson, Assistant County Counselor.
Case heard and decided by Senior Hearing Officer Amy S. Westermann.
ISSUE
Complainant appealed on the ground of overvaluation. Respondent initially set the TMV of the subject property, as residential property, at $270,000. The BOE sustained Respondent’s valuation. The Commission takes this appeal to determine the TMV of the subject property on January 1, 2015.
The Senior Hearing Officer, having considered all of the competent evidence upon the whole record, enters the following Decision and Order.
FINDINGS OF FACT
- Jurisdiction. Jurisdiction over this appeal is proper. Complainant timely appealed to the State Tax Commission.
- Evidentiary Hearing. The issue of overvaluation was presented at an evidentiary hearing, which was held on June 8, 2016, at the St. Louis County Government Administration Building, 41 South Central Avenue, Clayton, Missouri.
- Identification of Subject Property. The subject property is identified by parcel/locator number 17R420405. It is further identified as 8 Wharton Way Ct., Chesterfield, St. Louis County, Missouri. (Complaint; Exhibit 1)
- Description of Subject Property. The subject property consists of single family, ranch-style villa with 2,450 square feet of total living area, i.e., the main floor combined with the finished basement level. (Exhibit 2) The subject property includes one bedroom on the main floor, one room used as a bedroom in the basement, and three bathrooms. (Exhibit 2) The subject property also includes an open floor plan, vaulted ceilings in the main living area, high ceilings in the basement level, a two-car garage, a gourmet kitchen, a covered porch, and a private deck. (Exhibit 2)
- Assessment. Respondent set a true market value (TMV) on the subject property at $270,900 residential, as of January 1, 2015.
- Board of Equalization. The BOE sustained Respondent’s TMV of the subject property.
- Complainant’s Evidence. Complainant testified in his own behalf. Complainant testified that he had purchased the subject property in August 2014 for approximately $273,000. Complainant offered as evidence two photographs of the subject property showing the front entrance and a basement window (Exhibit A); photographs of two comparable properties in the same neighborhood (Exhibit B; Exhibit C); and a typed summary of the case stating that the TMV of subject property should be “slightly less than the $245,000 2014 value prior to reassessment” (Exhibit D). Exhibit B showed egress windows in the lower level of that comparable property. Exhibit C showed full size windows and a sliding glass door in the “walk-out” lower level of that comparable property.
Respondent objected to Exhibits B and C on the ground that they were irrelevant because they had been offered at the BOE hearing. The Senior Hearing Officer overruled the objections and received Exhibits B and C to be given the weight deemed necessary in light of all of the evidence. Respondent did not object to Complainant’s other evidence, which was received into the record.
- Respondent’s Evidence. Respondent offered as evidence the Notice of Decision of the BOE, which had sustained Respondent’s valuation of the subject property (Exhibit 1); the MARIS listing and photographs of the subject property (Exhibit 2); and the Certificate of Value for the subject property that was filed with the St. Louis County Recorder of Deeds (Exhibit 3). Complainant did not object to Respondent’s evidence, which was received into the record.
CONCLUSIONS OF LAW AND DECISION
Jurisdiction
The Commission has jurisdiction to hear this appeal and correct any assessment which is shown to be unlawful, unfair, arbitrary or capricious, including the application of any abatement. The Senior 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. Article X, Section 14, Mo. Const. of 1945; Sections 138.430, 138.431, 138.431.4, RSMo.
Basis of Assessment
The Constitution mandates that real property and tangible personal property be assessed at its value or such percentage of its value as may be fixed by law for each class and for each subclass. Article X, Sections 4(a) and 4(b), Mo. Const. of 1945. The constitutional mandate is to find the true value in money for the property under appeal. By statute, real property and tangible personal property are assessed at set percentages of true value in money: residential property at 19%; commercial property at 32%; and agricultural property at 12%. Section 137.115.5 RSMo (2000) as amended.
Investigation by Hearing Officer
In order to investigate appeals filed with the Commission, the Hearing Officer may inquire of the owner of the property or of any other party to the appeal regarding any matter or issue relevant to the valuation, subclassification, or assessment of the property. Section 138.430.2 RSMo (2000) as amended. The Hearing Officer’s decision regarding the assessment or valuation of the property may be based solely upon his inquiry and any evidence presented by the parties or based solely upon evidence presented by the parties. Id. During the hearing, the Hearing Officer inquired of Complainant. Respondent did not present any witnesses.
Complainant’s Burden of Proof
To obtain a reduction in assessed valuation based upon an alleged overvaluation, the Complainant must prove the true value in money of the subject property on the subject tax day. Hermel, Inc., v. State Tax Commission, 564 S.W.2d 888, 897 (Mo. banc 1978). True value in money is defined as the price that the subject property would bring when offered for sale by one willing but not obligated to sell it and bought by one willing or desirous to purchase but not compelled to do so. Rinehart v. Bateman, 363 S.W.3d 357, 365 Mo. App. W.D. 2012); Cohen v. Bushmeyer, 251 S.W.3d 345, 348 (Mo. App. E.D. 2008); Greene County v. Hermel, Inc., 511 S.W.2d 762, 771 (Mo. 1974). True value in money is defined in terms of value in exchange and not in terms of value in use. Stephen & Stephen Properties, Inc. v. State Tax Commission, 499 S.W.2d 798, 801-803 (Mo. 1973). In sum, true value in money is the fair market value of the subject property on the valuation date. Hermel, Inc., 564 S.W.2d at 897.
A presumption exists that the assessed value fixed by the BOE is correct. Rinehart, 363 S.W.3d at 367; Cohen, 251 S.W.3d at 348; Hermel, Inc., 564 S.W.2d at 895. “Substantial and persuasive controverting evidence is required to rebut the presumption, with the burden of proof resting on the taxpayer.” Cohen, 251 S.W.3d at 348. Substantial evidence can be defined as such relevant evidence that a reasonable mind might accept as adequate to support a conclusion. Cupples Hesse Corp. v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959). Persuasive evidence is evidence that has sufficient weight and probative value to convince the trier of fact. Cupples Hesse Corp., 329 S.W.2d at 702. 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).
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.” Westwood Partnership, 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. W.D. 1991).
Generally, a property owner, while not an expert, is competent to testify to the reasonable market value of his own land. Cohen, 251 S.W.3d at 348-49; Carmel Energy, Inc. v. Fritter, 827 S.W.2d 780, 783 (Mo. App. W.D. 1992). “However, when an owner’s opinion is based on improper elements or foundation, his opinion loses its probative value.” Carmel Energy, Inc., 827 S.W.2d at 783. A taxpayer does not meet his burden if evidence on any essential element of his case leaves the Commission “in the nebulous twilight of speculation, conjecture and surmise.” See Rossman v. G.G.C. Corp. of Missouri, 596 S.W.2d 469, 471 (Mo. App. E.D. 1980).
Weight to be Given Evidence
The Hearing Officer is not bound by any single formula, rule, or method in determining true value in money and 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 deemed necessary when viewed in connection with all other circumstances. Beardsley v. Beardsley, 819 S.W.2d 400, 403 (Mo. App. W.D. 1991). The Hearing Officer, as the trier of fact, is not bound by the opinions of experts but may believe all or none of the expert’s testimony or accept it in part or reject it in part. Exchange Bank of Missouri v. Gerlt, 367 S.W.3d 132, 135-36 (Mo. App. W.D. 2012).
Board Presumption and Computer-Assisted Presumption
There exists a presumption of correct assessment by the BOE. In charter counties or the City of St. Louis, there exists by statutory mandate a presumption that the Assessor’s original valuation was made by a computer, computer-assisted method or a computer program – the computer-assisted presumption. These two presumptions operate with regard to the parties in different ways. The BOE presumption operates in every case to require the taxpayer to present evidence to rebut it. If Respondent is seeking to prove a value different than that set by the BOE, then it also would be applicable to the Respondent. The computer-assisted presumption is applicable only if (1) the BOE lowered the value of the Assessor and Respondent is seeking to sustain the original assessment and (2) it has not been shown that the Assessor’s valuation was not the result of a computer assisted method. The BOE’s valuation is assumed to be an independent valuation.
In the present appeal, the BOE sustained the initial valuation of Respondent; therefore, the computer-assisted presumption is not applicable in the present appeal.
Methods of Valuation
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. See, Nance v. STC, 18 S.W.3d 611, 615 (Mo. App. W.D. 2000); Hermel, Inc., 564 S.W.2d at 897; Xerox Corp. v. STC, 529 S.W.2d 413 (Mo. banc 1975). 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. 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. 1974).
Discussion
Although Complainant presented evidence to support his opinion of the subject property’s TMV, that evidence is neither substantial nor persuasive because, if relied upon, the fact finder would be required to resort to speculation to conclude the TMV of the subject property on January 1, 2015, should be $247,800.
First, Complainant’s evidence was not substantial to support his opinion as to value. Substantial evidence is that which is relevant, adequate, and reasonably supports a conclusion. Cupples Hesse Corp., 329 S.W.2d at 702.
Complainant’s opinion that the subject property had a value of $247,800 was not supported by any of the three recognized approaches to value. Complainant testified that no appraisal of the subject property had been performed within the three years prior to the evidentiary hearing. Although Complainant presented photographs of the basement window of the subject property and of the windows in the basement/lower level of two comparable properties from the same neighborhood as the subject property, the photos did not indicate the specific value that should be assigned to the subject property due to the differences in the windows. Complainant’s exhibits did not establish an amount that should be subtracted from the BOE’s valuation of the subject property due to the lack of egress windows or an amount that could be attributed to the value of the comparables because of the accessibility of their lower levels. Although it is reasonable to accept Complainant’s testimony that installing egress windows in an existing basement would be costly and would require much effort, Complainant did not present any evidence of the specific cost, such as a bid from a contractor.
Second, Complainant’s evidence was not persuasive to rebut the presumption of true market value advocated by Respondent. Persuasive evidence is that which causes the trier of fact to believe, more likely than not, the conclusion advocated is the correct conclusion. Id.
Complainant testified that he purchased the subject property in August 2014 for approximately $273,000. Complainant testified that no appraisal had been performed as part of the purchase and that he did not recall whether an inspection had been performed as part of the purchase. Complainant testified that he had been “duped” by the sale advertisement listing the subject property as a two bedroom unit. Complainant testified that the bedroom in the basement of the subject property was an illegal bedroom under St. Louis ordinance because the basement lacked an egress window. Complainant testified that this “illegal” bedroom lowered the value of the subject property because the subject property is actually a one-bedroom unit rather than a two-bedroom unit. However, Respondent’s Exhibit 3, the Certificate of Value for the subject property, was signed by Complainant and indicated that the full consideration paid for the property was $275,000. Complainant also testified that his wife, a joint title owner of the subject property, was a real estate agent at the time they purchased the subject property, had acted as the buyer’s agent during the purchase, and had received part of the proceeds from the sale. Moreover, Exhibit 2, the MARIS listing of the subject property stated that the unit included a “Possible Extra Bdr” and that the basement included a “Sleeping Area.” Consequently, in light of all the evidence, it is impossible for the fact finder in this case to conclude that the TMV of the subject property as of January 1, 2015, approximately five months after Complainant purchased it for $273,000, should have been $247,800 based on the lack of an egress window in the basement. Given that Complainant’s evidence was not substantial and persuasive to rebut the presumption that the BOE’s valuation was correct, it is reasonable to find and conclude that the TMV of the subject property on January 1, 2015, was $270,900.
ORDER
The true market valuation for the subject property as determined by Respondent for the subject tax day and sustained by the BOE is AFFIRMED.
The assessed value for the subject property for tax years 2015 and 2016 is set at $51,470 residential ($270,900 TMV).
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 application for review is based will result in summary denial. Section 138.432, RSMo
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 2nd August, 2016.
STATE TAX COMMISSION OF MISSOURI
Amy S. Westermann
Senior Hearing Officer
Certificate of Service
I hereby certify that a copy of the foregoing has been sent electronically or mailed postage prepaid this 2nd day of August, 2016, to: Complainants(s) counsel and/or Complainant, the County Assessor and/or Counsel for Respondent and County Collector.
Jacklyn Wood
Legal Coordinator