Inhabitants of the Town of Easton v. Glick

• Court: Superior Court of Maine
• Decided: January 3, 2017
• Docket: AROap-16-004
• Status: Unpublished

Opinion

STATE OF MAINE SUPERIOR COURT AROOSTOOK, ss. CARIBOU DOCKET NO. CARSC-AP­ 2016--004

TNHABrTANTS OF THE ) TOWN OF EASTON )

PLAINTIFF/APPELLANT ) v. ) } THE COUNTY OF AROOSTOOK and ) Its COMMISSIONERS ) DEFENDANT/APPELLEE ) ) ) ) ) And ) ) ) ELI H. GLICK, et al ) ) PARTIES IN ) INTEREST/APPLICANTS ) )

The Inhabitants of the Town of Easton (hereafter Town) have appealed from

the decision of the The County of Aroostook and its Commissioners

(hereafter Commissioners or County) granting requests for tax abatements.

In 20 J5 the Town conducted a community wide revaluation resulting in a

town-wide increase in valuations and tax assessments. The Applicants are Eli H. Glick, Uria E. Miller, Jacob E. Miller, Samuel M Swarlzentruber,

Jonas Gingerich and Enos M. Yoder. In February 2016 the Applicants each

made similar applications for abatement of property taxes. (references to the

Record appear as R. at _ ) (R. at 4-18). Prior to their applications the

Applicants had each recently erected similarly constructed large barns. The

Applicants arc of Amish heritage and built their barns in the Amish tradition

of assembling large groups of their people and erecting the structures in a

community effort, i.e. a barn raising. (R. at 217) In their applications for

abatement, the Applicants each similarly asse1ted the Town's valuation was

overstated and explained their varied purposes and uses, and the barns

simplistic construction and limitations. (R. at 4-18). The Town did make

modest adjustments to two Applicant's assessments but otherwise denied the

requests. (R. at 1). The Applicants appealed the Town's denials to the

Commissioners of Aroostook County. (R. at 55-97).

Hearing was held before the Commissioners on June 22, 2016. The

Applicants testified at the hearing, supplementing the information they had

previously provided in their abatement applications. The testimony included

a description of the Amish barn raising tradition, general descriptions of the

barns simplistic design and construction with no modern day amenities. (R.

2 at 217-219). And the AppJicants each described how much material costs

they had into their barns and provided estimates of what labor would have

cost had they in fact had to pay for labor. Id. 1 At the hearing the Applicants

sought an abatement of approximately 50% of the Town's valuation. (R. at

221 ). There was no mathematical showing or formula indicating how they

arrived at that requested amount.

The Town also presented evidence at the hearing, which included the tax

cards(valuations) for the Applicant's properties and also for what the Town

presented as comparable properties. (R. at l 06- 121, 124- 169). In addition

the Town Manager, Jamcs Gardner, and the assessor hired by the Town to

conduct the revaluation, Garnett Robinson, testified. A summary of that

testimony and evidence includes:

-the Town conducted a complete re-evaluation as required by the State

of Maine;

-the assessor looked at all properties and attempted to equalize values;

-the Amish barns are large, discounts were made for material quantity

and allowed for depreciation;

-cost schedules (method) were used for valuation;

I Some of the Applicants used a $12 per hour estimate for labor cost hut mosl just offered an estimated lump sum.

3 -sales data of the subject or similar properties was unavailable;

-the properties were classified at "O" quality;

-the barns were assessed as if contractors were hired for construction;

-disharmony exists with local contractors regarding Amish labor rates;

-comparables were provided. (R. at 219-220).

Ultimately the Commissioners found that the Applicant's religion, lifestyle

and comrnunity effort alJowed them to build the large structures in an

economical way, and that the simplistic construction of the barns without

modern conveniences have a mitigating impact on "just value". (R. at 220).

The Commissioners found the Applicants had met their burden to show the

assessments were "manifestly wrong" noting specifically :

-the wide disparity between the Applicant's costs(to construct) and the

municipal valuation of their structures, a significant portion of the disparity

due to the simplicity of the structures;

-there is no evidence on the record lo support the true market value of

these properties or similar structures, the structures are unique to the Amish

and the pool of potential buyers is practically limited to the Amish;

-there is no comparable property on the rel:ol'Cl; the "so-called"

comparables (provided by the Town) include structures with concrete floors,

4 insulation, heat, air conditioning and air exchange units, electricity, running

water, bathrooms, etc. These propcrtics(comparablcs) suppo1t modern

conveniences that the Amish structures do not possess;

-the Applicants material and labor costs were not challenged;

-from a market perspective, the Amish structures arc not attractive to

potential buyers because they don't have the features, convenience and

amenities that most consumers consider essential, they are "only good for

Amish"; These stmctures have reduced utility and market value. (R. at 220­

221).

Finding that the Applicants had met their burden, The Commissioners then

addressed the amount of abatement, citing ''If the commissioners think that

the applicant is over-assessed, the applicant is granted such reasonable

abatement as the commissioners think proper." 36 M.R.S.A. 844( I). (R. at

22 l ). The Commissioners noted the Applicants sought an abatement of 50%

of their valuation. Id. The Commissioners farther indicated grading is a

significant variable in valuation but found the Town's testimony to be

material weak pertaining to grading. Id. The Commissioners also found that

the Town's assertion that the barns were valued at a D grade was "not true in

all cases." Id. The Commissioners also indicated that they had requested

5 from the Town more information concerning grading but none was provided.

Id. The Commissioner ultimately ruled " ..we believe a reduction of25%

... is in order ..... it is fair and just. .. These structures are basic, rudimentary

and, in many ways, obsolete. Their demand on the open market is really

quite limited and we believe their value is significantly diminished because

of that." Id. The Commissioner's decision did not provide any mathematical

basis or formula demonstrating how they determined the 25% reduction.

The cou,t notes that the evidence does not include any valuations based on

comparable sales or by the income approach. The valuation approach

utilized by the Town was the cost method, utilizing traditional contractors.

Although the Applicants provided evidence of their material costs with an

estimate for labor, they estimated labor at a rate of $12 per hour or simply

provided a lump sum; the Applicants did not provide evidence of what the

cost to erect their structures would be on the open market in a competitive

process or with contractors. The court also notes that the record indicates the

Commissioners did not view the properties. After the hearing the

Commissioners did ask the Town to provide valuations for the properties at

one letter grade condition lower. (R. at 186-206). But the Town refused Lo

6 2 provide such reduced valuations. Id. No such request was made of the

Applicants and the Applicants did not provide 01· offer such evidence of

what the values of their properties would be if assessed al a condition one or

some level lower than that utilized by the Town. So ultimately no valuation

or data was in evidence or in the record to establish what the valuations of

the properties would be if valued at a condition one level lower than that

utilized by the Town.

STANDARD OF REVIEW

In this case, the Superior Court is acting in an appellate capacity. This

requires application of the substantial evidence standard of review, requiring

it to search the entire record to determine whether on the basis of an the testimony and exhibits before the agency (Commissioners) it could fairly

and reasonably find the facts as it did. Vienna v. Kokernak, 612 A.2d 870,

872 (Me. I 992). That the record contains evidence inconsistent with the

result, or that inconsistent conclusions could be drawn from the evidence,

does not render the commissioner's findings invalid if a reasonable mind

1 The comt interprets the Commissioner's request us asking for evidence of what the valuations would be if the properties were rated at a condition at the next lower level, in other words, asking the Town to provide the data for the valuation if the condition was reduced by one level. The Town refused to provide that data.

7 might accept the relevant evidence as adequate to support the

commissioner's conclusion. Id.

The Maine Constitution requires that "all taxes upon real and personal

estate, assessed by the authority of the State, shall be appo11ioned and

assessed equally according to the just value thereof." Me. Const. art IX, § 8.

Just value means market value. Terfloth v. Town.of Scarborough, 2014 ME

57, i111. Accordingly an assessment must be supported by two factual

findings. First the property must be assessed at its fair market value. Id.

Second, the assessed value must be equitable, that is, the property must be

assessed at a at a relatively uniform rate with comparable property in the

district. Id.

A taxpayer who seeks a tax abatement must prove that the assessed

valuation is "manifestly wrong." Terfloth, ~ 12. An assessment is manifestly

wrong if the taxpayer can demonstrate

( 1) that the taxpayer's property was substantially overvalued and an

injustice resulted from the overvaluation;

(2) that there was unjust discrimination in the valuation of the

property, or

8 (3) that the assessment was fraudulent, dishonest, or illegal. kt~

When a taxpayer appeals from a Town's denial of an abatement, the

Commissioners begin their review of the assessment with the presumption

that the assessor's valuation of the property is valid. Yusem v. Town of

Raymoncl, 200 l ME 61, ~ 8. To overcome the presumption, the taxpayer

seeking an abatement from the Commissioners has the initial burden of

presenting credible, affirmative evidence to meet his or her burden of

persuading the Commissioners that the assessor's valuation was manifestly

wrong. Id.!. If, but only if, the taxpayer meets that burden, the Commissioners

must engage in an independent determination of fair market value. Id.

The judgment that a property's assessed value is in excess ofjust value

requires a comparison between the local assessment and the version of value

that the petitioner fo1· abatement contends is the just one. City 9f Watervi Ile

v. WatervilL~ Homes, 655 A.2d 365, 366, (Me. 1995). If the petitioner for

abatement fails to provide the Board (in this case Commissioners) with

evidence ofjust value that the Board (Commissioners) deems credible, the

Board (Cornmissioners) has no basis in the petitioner's case for comparing

local assessment and the petitioner's version ofjust value. Id._

9 DISCUSSION

Applying the substantiaJ evidence standard of review, there may be

sufficient evidence in the record to support the Commissioner's fmding that

the Applicant's had met their burden to prove that the assessment done by

the Town was wrong or high; but the Court cannot find any evidence which

supports the Commissione1·'s decision to award a 25% reduction in the

valuation or evidence of what the "just value" or "fair market value" would

be if not the value established by the Town.

The Town utilized a cost method to assess the Applicant's properties, there

being no viable sales data. The Town's assessment did adjust for material

quantity, depreciation and considered the properties to be lower quality,

typically "D" standard, but for labor it assessed the properties as if

contractors had been hired, (R. at 219). The Applicants presented evidence

describing that their properties did not have the amenities and conveniences

of common modern buildings. And the Applicants presented evidence

describing how they built the properties in their traditional barn raising

fashion, with no cost for labor. But the Applicants only provided "estimates"

10 of what their labor would cost, either providing an estimated lump sum or an

amount assuming $12 per hour per man hours.. (R. at 217-218).

The Commissioners specifically found that there was a wide disparity

between the Applicants' costs and the municipal valuation, due significantly

to the simplicity of the structures, lack of modern amenities and potential

buyers being somewhat limited to Amish. Again, those findings are

supported by the record, and could support a finding that the Town's

assessment was too high. But that is not enough .

In essence, all that the Applicant's successfully proved was that the Town's

assessment was likely high; they did not prove what the assessments of their

buildings should be. Impeachment of the Town's assessment alone does not

fully meet the Applicant's burden. See Watt:rville Homes, at p. 366. ''The

petitioner for an abatement must prove his case. He must show that the

property is overrated. Stated another way, the burden o,lproving that

assessed value is in excess r~fjust value is on the person seeking

abatement ... the taxpayer seeking abatement carries that burden by proving

that the assessed valuation in relation to the just value is manifestly wrong. "

lg_._, citing Sears, Ro~Q\ICk &_~o. v. Ci ty of Presgue Isl~. ct al._, 150 ME

I1 181, I 86 and Delta Chemicals v. Inhabitants of Searsport, 438 A.2d 483,484

(Mc. 1981 ).

The Waterville Homes case is instructive to the case at hand. In that case,

the State Board of Tax Review, reviewing an abatement request that had

been denied by the city assessor, impliedly found that the City's assessment

was wrong. The petitioner's case had largely focused on impeaching the

City's assessment, but presented umeager" evidence of value. Id. The Board

found the City's assessment was wrong, but apparently also rejected the

petitioner's evidence of value, so instead arrived at its own judgment of

value. On appeal by the City, the Superior Court vacated the Board's

decision, which was upheld on appeal to the Law Court. Id.

In this case, the Applicant's gave "estimates" of labor costs, some using $12

per hour for manhours while others provided an estimated lump sum. And in

their applications they indicated the amount of abatement being requested.

(R. at 4-18). But the Applicant's did not present actual evidence of"just

valuation". They perhaps successfully impeached the Town's assessment by

providing evidence of the buildings simplistic design and construction, and

also evidence of their very modest construction cost. But this is not proof of

12 "just value". Instead of presenting evidence of"just value" the Applicants

on Iy stated what amount or level of abatement they sought, " ..approximately

50%.." (R. at 221 ). It is noted that even the sum of the material costs and

estimated labor costs provided by the Applicants does not resemble the tax

valuations requested after a 50% abatement. There is simply no

mathematical showing or formula or other evidence establishing how the

Applicants arrived at the abatements !'equested. In the end, the court cannot

find anywhere in the record where the Applicants provided evidence ofjust

value.

Indeed, the Commissioners did not even accept the Applicant's proposal of a

50% reduction. Instead, the Commissioners awarded a reduction of 25%,

stating " .. it is an amount that is fair and just to the community as a whole."

There is no evidence or showing in the record to suppo1t a 25% reduction or

showing how the Commissioners determined this was an appropriate

amount, i.e. no math, no formula. In other words, with no evidence in the

record ofjust value, the Commissioners rejected the Applicant's suggested

amount and exercised its own judgment of an abatement amount, with no

showing how they arrived at that amount. The Commissioners made no

findings ofjust value or fair market value.

13 Although the Applicant's may have produced suHicient evidence that the

Town's assessment was high, they did not present actual evidence ofjust

value or fair market value. The Applicant's produced evidence of the unique

and unusual circumstances employed to erect lhese buildings with minimal

cost, but that by itself is not evidence of just value or fair market value. In

fact, in its decision, the Commissioners found "There is no evidence on the

record to support the true market value of these properties or similar

structures in the community." (R. at 220). As previously noted, the

Commissioner's rejected the requested abatement amount, indicative that

there was insuflicient evidence to support such amounts, then exercised its

own judgment. But as stated in Waterville Hom~ If the petitioner for

abatement fails to provide the Board ·with evidence o,fjust value that the

Board deems credible, the Board has no basis in the petitioner's case.for

comparing the local assessment and the petitioner's version ofjust value. If

the Board rejects the petitioner's evidence ..... and then remedies the

deficiencies in the petitioner's proof by making its own calculation o.{Just

value independently o_/j1etitioner 's proof, the Board relieves the petitioner of

its burden lo prove that the assessed valuation in relation to the just value is

manifestly ·wrong. Watervillc _Homcs, p. 366.

14 That is the result here. The Applicants failed to meet their burden of

producing evidence of their prnperties just value or fair market value. It was

el'l'or for the Commissioners to remedy the Applicants deficiencies in their

proof and exercise its own judgment of an abatement amount with no

supporting evidence in the record. The Town's appeal is granted. The

Commissioner's decision is hereby vacated and the decision of the

Municipal assessor is reinstated .

The clerk shall incorporate this Order into the docket by reference pursuant to M.R.Civ.P. 79(a).

i:l Date(J w ""9" ,(/ ;I . 2017 Justice, Superior Court

15 Appeal CARSC-AP-2016-004

Date 08/12/2016 Docket No. CARSC-AP-2016-004 Aroostook Filed Countv Action 808

Plaintiff Inhabitants of the Town of Defendant County of Aroostook Easton Paul). Adams, Commissioner Paul J. Underwood, Commissioner Eli Glick vs. Ul'ia Miller Jacob Miller Samuel Swartzentruber Jonas Miller Enos Yoder

Attorney Richard Currier Attorney John Wall for Paul Adams and Paul Underwood

Date of Entry 08/22/2016 Complaint med by Atty Currier on 08/12/2016. 08/26/2016 Summons served on Douglas Beaulier on 08/17/2016 and filed on 08/23/2016. 08/26/2016. Summons served on Enos Yoder on 08/18/2016 and filed on 08/23/2016. 08/26/2016 Summons served on Uria Miller, Samuel Swartzentruber, Eli Glick, Jacob Miller, and Jonas Gingerich on 08/18/2016 and filed on 08/23/2016. 08/26/2016 Notice and Briefing Schedule issued to all parties on 08/26/201.6. 09/15/2016 Answer and Affirmative Defenses (County of Aroostook and Commissioners Paul J. Adams and Paul J. Underwood) by Atty Wall filed on 09/02/2016. 09/26/2016 Consented to motion for enlargement of time signed by Justice Stewart on 09/26/2016. 10/04/2016 Record on Appeal filed by Atty Currier on 10/03/2016. 10/28/2016 Briefof Pit/Appellant filed on 10/21/2016 by Atty. Currier. 11/18/2016 Def/Appellees unopposed motion for enlargement of time filed by Atty. John Wall on 11/14/2016. 11/23/2016 Order granting Defendant/ Appellees County of Aroostook and Commissioners Paul J /\dams and Paul J Underwood's Unopposed Motion for Enlargement of Time signed by Justice Harold Stewart on 11/21/2016. Appeal CARSC-AP-2016-004

12/05/2016 Defendants County of Aroostook and Commissioners Paul J. Adams and Paul J. Underwood's Rule 808 Brief flied by atty John Wall on 12/02/2016. 12/14/2016 Letter from Richard Currier, F.sq. informing the court that the Town of Easton does not intend to file a Reply Brief and requesting a hearing or conference filed 12/14/2016. 01/06/2017 Justice Harold Stewart's Decision Entered 01/03/2017. "The town's appeal is granted. The Commissioner's decision is hereby vacated and the decision of the Municipal assessor ls reinstated."