Lineberger Family Partnership v. Town of Scarborough

• Court: Superior Court of Maine
• Decided: March 22, 2007
• Docket: CUMap-06-38and39
• Status: Unpublished

Opinion

STATE OF MAINE SUPERIOR COURT CUMBERLAND, ss. CIVIL ACTION DOCKET NO. AP-06-38 AP-06-39 z~al r'i.t\R? 2 I' 2: 25 1". 7 )" , .: ~-,/ "

LINEBERGER FAMILY PARTNERSHIP

Plaintiff v. ORDER ON 80B APPEAL

TOWN OF SCARBOROUGH

Defendant

and

JAMES E. LINEBERGER, JR.

Plaintiff DONI-ILD L "' .~" .IA.' liP. . GARBRECHT v. . ,RAPv

TOWN OF SCARBOROUGH AUG 02 LUUI Defendant

Before the Court are the consolidated appeals of Plaintiffs James E.

Lineberger, Jr. ("Lineberger") and the Lineberger Family Partnership

("Partnership") pursuant to M.R. Civ. P. 80B of the Town of Scarborough

("Town") Board of Assessment Review's ("Board") decision to deny Plaintiffs'

requests for tax abatements.

BACKGROUND The Partnership owns property improved by a building that is located at

17 Massacre Lane in Scarborough, Maine ("Massacre Property"). Lineberger

owns property improved by a building that is located at 10 Saccarappa Lane in

Scarborough ("Saccarappa Property"). On September 21, 2005, Lineberger and

the Partnership ("Plaintiffs") applied for tax abatements of property taxes

1 assessed on the Massacre Property and the Saccarappa Property for the period

between July I, 2005 and June 30, 2006. The Town assessed the Saccarappa

Property's land at $690,100 and its building at $37,900 for a total value of

$728,000. The Town assessed the Massacre Property's land at $1,187,900 and its

building at $240,200 for a total value of $1,428,100.

On January 3, 2006, the Assessor for the Town ("Assessor") denied

Plaintiffs' abatement applications. On March 2, 2006, Plaintiffs submitted

Applications for Assessment Review to the Board for both properties. The Board

convened a hearing on both appeals on March 31, 2006. At the hearing Plaintiffs

contested only the Assessor's valuation of the land for each property, agreeing

with the valuation of the buildings. At the hearing, Lineberger presented his own

testimony as well as the testimony of Albert Childs ("Childs"), a licensed Maine

real estate appraiser. The Town presented testimony by the Assessor.

Following presentation of the evidence, the Board requested that each side

submit proposed Findings of Fact. On June 27, 2006 the Board held a hearing at

which it voted to deny Plaintiffs' abatement requests. Subsequently, on June 29,

2006, the Board released its written decision on these matters, essentially

adopting the Town's proposed findings of fact. Plaintiffs timely filed this appeal.

STANDARD OF REVIEW

The Court reviews a zoning board's decision for abuse of discretion or

findings not supported by substantial evidence in the record. York v. Town of

Ogunquit, 2001 ME 53, err 6, 769 A.2d 172, 175. Substantial evidence is evidence

that is sufficient for a board to have reasonably found the facts as it did. Ryan v.

Town of Camden, 582 A.2d 973, 975 (Me. 1990). The burden of persuasion is on the

party challenging aboard's decision to show that the evidence compels a

2 different result. Twigg v. Town of Kennebunk, 662 A.2d 914, 916 (1996). The Court

must not substitute its judgment for that of a board. [d. Further, a board's

"decision is not wrong because the record is inconsistent or a different

conclusion could be drawn from it." [d.

In seeking a tax abatement, the taxpayer must overcome "the presumption

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

2001 NIB 61,

taxpayer bears the burden of coming forward with affirmative evidence proving

that an assessment is manifestly wrong. [d.

established that in order for a taxpayer to prevail in challenging aboard's

assessment, "the taxpayer must show one of three things: (1) that the judgment

of the assessors was irrational or so unreasonable in light of the circumstances

that the property is substantially overvalued and an injustice results; (2) that

there was unjust discrimination; or (3) that the assessment was fraudulent,

dishonest, or illegal." McCullough v. Town of Sanford, 687 A.2d 629,630 (Me. 1996).

DISCUSSION

I. Effect of Plaintiffs' Failure to Challenge the Assessment of their Buildings

Plaintiffs do not maintain that there was unjust discrimination in their

assessed values or that their assessments were fraudulent, dishonest, or illegal.

They only argue that the Assessor's appraisal was so unreasonable that their

properties were substantially overvalued resulting in an injustice.

A threshold issue is whether Plaintiffs can prevail in light of their failure

to dispute the assessment applied to the buildings on their properties. The Town

asserts that they cannot, relying on a case in which the Law Court stated that it

had "never sustained an unjust discrimination claim based only on a single

3 component of a total assessment, without a showing that the property's total

assessment was discriminatory." Roberts v. Town of Southwest Harbor, 2004 ME

132,

this Court have found discrimination after comparing the total assessed values of

similarly situated properties." Id.

Assuming that Roberts is applicable to tax abatement cases where it is

argued that there has been substantial overvaluation of a property such that an

injustice results and not simply to unjust discrimination cases, the Town's

argument nevertheless fails. In Roberts, a taxpayer's property was physically

divided "into categories based on the characteristics and potential use of the

property ... [and e]ach of these categories [was] assessed at a specific rate." Id.

2, 861 A.2d at 617. Rather than argue that the cumulative total of the values

assigned to each category resulted in unjust discrimination, the taxpayer argued

only that the valuation applied to the "Rear Land 2 portion of his property was

assessed at a rate higher than other Rear Land 2 property in the Town." Id. In

response, the court held that a taxpayer cannot succeed in an abatement case by

arguing that only a single category of his property, rather than the property as a

whole, was overvalued. Id.

only when a property as a whole is assessed in a way that does not reflect its true

market value or is inconsistent with assessments of similar properties that there

is a "constitutional harm." See id.

The Town's interpretation of Roberts would turn that case's holding on its

head. Whereas Roberts instructed that a taxpayer may not succeed in an

abatement request in which he compares only the assessment of one category of

his property against the assessment of one category from other properties

4 without reference to the total value of the properties, the Town's interpretation

would require a taxpayer seeking an abatement to not only plead that his whole

property has been overvalued in relation to others, but that each individual

category of his property has likewise been overvalued. Nothing in Roberts

supports this. Plaintiffs have argued that their land is overvalued and, when put

together with the Assessor's valuation of their buildings, the total value of their

properties are overvalued. This pleading is sufficient.1

II. Proper Legal Standard

Plaintiffs argue that the Board applied an improper legal standard in

determining whether their property was overvalued to the point that the

Assessor's valuation could be considered "manifestly wrong." Specifically, the

Board stated the following:

To meet the legal threshold of what is required to prove "manifest error" in a property tax appeal, i.e. the taxpayer's "burden of proof", the Taxpayer must:

a. Present evidence which that Board accepts as credible that impeaches the validity of the assessment and b. Provide evidence and proof of the actual fair market value of the applicant's property that the Board also deems credible.

Only if the Taxpayer satisfies both of these burdens is the Board authorized to engage in an independent determination of the fair market value of the property for purpose [sic] of granting an abatement.

(R. at 125.) Plaintiffs argue that this was an incorrect formulation of their burden

of proof in that they should not have been required to offer evidence impeaching

the validity of the assessment.

1The Town's interpretation would lead to the absurd conclusion that so long as an assessor correctly values any single section of a taxpayer's property, a taxpayer could not successfully seek an abatement regardless of how large the overvaluation on the remainder of the property.

5 In support of their position, Plaintiffs rely heavily on language from

Yusem v. Town of Raymond stating that "[i]mpeachment of the assessor's

methodology alone is insufficient to meet [a taxpayer's] burden [in a tax

abatement case]." 2001 ME 61,

language does not support the Board's interpretation that a taxpayer is required

not only to present evidence of a property's fair market value, but also to present

evidence impeaching an assessor's methodology.

While the language quoted by Plaintiffs may be ambiguous when read out

of context, a thorough reading of Yusem makes clear that the Board applied the

correct legal standard. Yusem was a case in which the taxpayer "presented no

evidence of [his] property's just value and no evidence that his property was

overvalued" instead relying upon "perceived errors in the assessor's methods to

make his case." Id.

"notwithstanding [his] inability to demonstrate that the result was other than fair

and just ... he [was] entitled to an abatement because the process by which that

result was reached may have been flawed." Id.

this context that the court stated that impeachment of the assessor's methodology

by itself was not enough for a taxpayer to meet his burden. The court went on,

however, to state the following:

In sum, when the taxpayer fails to provide the Board with evidence of just value sufficient to convince the Commissioners or Board that an error may have occurred, the Commissioners have no basis for inquiring further into the assessor's method of determining just value. Because Yusem failed to present evidence that the assessment was manifestly wrong, there was no reason for the Commissioners to scrutinize the manner by which the assessment was derived.

6 Id. <[ 15, 769 A.2d at 872 (internal citation omitted). This section of the court's

opinion makes clear that while presentation of evidence sufficient to support a

finding by a Board that a property is overvalued is a necessary step in any tax

abatement case, a taxpayer must also impeach the assessor's method of

determining just value. Any other conclusion would be contrary to the

instruction that a tax assessor's valuation of a property is entitled to a

presumption of validity. Id. <[ 8, 769 A.2d at 869-70.z Therefore the Board applied

the correct legal standard in making its decision.

III. Substantial Evidence in the Record

Even under Plaintiffs' proposed legal standard, they would have been

required to provide credible proof regarding a different valuation of their

properties than the Assessor's valuations. Given that the Board explicitly found

that Plaintiffs had failed to satisfy this requirement, remand would only be

appropriate if the record evidence compels a different conclusion from that

reached by the Board.

Essentially, the Board weighed the credibility of the testimony of

Plaintiffs' expert Childs against that of the Assessor. 3 Childs presented no formal

appraisal, but did present a "land analysis" on a spreadsheet during his

testimony. This land analysis included properties from both the Ferry Beach area,

2 By merely presenting evidence in support of his own valuation, a taxpayer can at best establish that his valuation may be a reasonable one. Because the taxpayer has the burden of proof before a board, such a showing cannot demonstrate that the assessor's valuation was "manifestly wrong." To do so, a party must attack the assessor's methodology. 3 Lineberger also testified and offered his own estimates regarding the value of the properties. In reaching his valuation, Lineberger looked at recent sales in the neighborhood, derived a per-acre value from those sales, and then applied that value directly to his property. Plaintiffs' own expert discredited this method and Plaintiffs do not argue that Lineberger's testimony before the Board provides support for their position.

7 referred to as the "West" neighborhood, and the Lanes, also referred to as the

"East" neighborhood. Plaintiffs' properties are both located in the East

neighborhood. Childs used only comparable properties from the West

neighborhood, however, and stated that the "general consensus" was that

properties in the East neighborhood could be expected to sell for 15-25% more

than comparable properties in the West neighborhood. Childs, however, could

not provide documentation for his sources to support this "consensus" nor could

he provide documentation to show how he chose the differential to be applied.

As a result, the Board found this information to be "unsupported hearsay" and

found "no grounds to justify the market differential stated." (R. at 126.)

The Assessor also testified at the hearing that, in his opinion, there is no

interchangeability between the East and West neighborhoods such that a straight

15-25% increase in the values of properties from the West neighborhood that are

comparable to properties from the East neighborhood would accurately account

for the difference in values of the properties. (R. at 40.) Further, the Board

thought it important that the Assessor used sales data from both the East and

West neighborhoods. (R. at 126.)

Based on the proceedings before the Board as described above, there is

nothing in the record compelling a conclusion different from that reached by the

Board. Plaintiffs essentially admit this is the case in their reply brief, stating that

"[u]ltimately, [] inconsistencies between the Town's position and the Record

alone may not be legally dispositive of these appeals given the deference afforded

the Board," before going on to argue that the Board's imposition of an allegedly

incorrect legal standard warrants a remand. (PIs.' Rep. Br. 3.) However, as

explained earlier, under the legal standard proposed by Plaintiffs they still

8 would have been required to demonstrate that their properties were overvalued.

Because the Board already made a determination against Plaintiffs on this issue,

even if it were error to require Plaintiffs to attack the methodology of the

Assessor, it was harmless error, as it did not affect the outcome of the Board's

decision. As a result, such an error could provide no basis for remand to the

Board. See M.R. Civ. P. 61.

Therefore, the entry is:

Plaintiffs' Rule BOB appeal is DENIED. The Town of Scarborough Board of Assessment Review's decision to deny Plaintiffs' requests for tax abatements is AFFIRMED.

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

Dated at Portland, Maine this 22~day of &6 ,2007.

9 Date Filed 7-24-06 CUMBERLAND Docket No. ~A~P~0",--",-6_-",-38=-- • County cons. w/AP-06-39

Action 80B Appeal

LINEBERGER FAMILY PARTNERSHIP TOWN OF SCARBOROUGH

Ys.

Plaintiff's Attorney Defendant's Attorney Bradford Pattershall Esq ROBERT CRAWFORD, ESQ. PO BOX 17555 P.O. BOX 9729 Portland ME 04112 PORTLAND, ~~INE 04104-5029

Date of Entry Date Filed 7-24-06 CUMBERLAND Docket No. _-'-'A"'P_"O'-"6'-----"'3'-'"'9'---c_o_n_s_._w--.:./_A_P_-_0_6_-_3_8_ County

Action

• 80B APPEAl.

JAMES E. LINEBERGER JR TOWN OF SCARBOROUGH

Plaintiff' s Attorney Defendant's Attorney BRADFORD PATTERSHALL ESQ ROBERT J. CRAWFORD, ESQ. PO BOX 17555 P.O. BOX 9729 PORTLAND ME 04112 PORTLAND, MAINE 04104-5029

Date of l:'ntrv .... -. __ . -L. _