Case Title: Sapina v. Cuyahoga County Bd. of Revision

Citation: 2013-Ohio-3028

Docket Number: 2012-0883

State: ohio

Court: Ohio Supreme Court

Date: 2013-07-16T00:00:00Z

Document:
[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as 
Sapina v. Cuyahoga Cty. Bd. of Revision, Slip Opinion No. 2013-Ohio-3028.] 
NOTICE 
This slip opinion is subject to formal revision before it is published in 
an advance sheet of the Ohio Official Reports.  Readers are requested 
to promptly notify the Reporter of Decisions, Supreme Court of Ohio, 
65 South Front Street, Columbus, Ohio 43215, of any typographical or 
other formal errors in the opinion, in order that corrections may be 
made before the opinion is published. 
 
SLIP OPINION NO. 2013-OHIO-3028 
SAPINA ET AL., APPELLANTS, v. CUYAHOGA COUNTY BOARD OF  
REVISION ET AL., APPELLEES. 
[Until this opinion appears in the Ohio Official Reports advance sheets,  
it may be cited as Sapina v. Cuyahoga Cty. Bd. of Revision,  
Slip Opinion No. 2013-Ohio-3028.] 
Taxation—Valuation of real property—Recent sale including unallocated 
personal property—Procedure when record demonstrates that value being 
appealed is wrong—Independent valuation by Board of Tax Appeals. 
(No. 2012-0883—Submitted May 7, 2013—Decided July 16, 2013.) 
APPEAL from the Board of Tax Appeals, Nos. 2009-K-667 and 2009-K-816. 
____________________ 
Per Curiam. 
{¶ 1} In this real-property-valuation case, the taxpayers, Ivica and 
Katarina Sapina, acquired a two-story building in 2006, with two storefronts 
below and two residential apartments upstairs.  The real property was sold to them 
as part of the same contract by which they acquired a business on the first floor of 
the building.  Thus, the asset purchase included personal property (restaurant 
equipment plus a covenant not to compete) as well as the realty. 
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{¶ 2} For tax year 2007, the auditor used the entire aggregate purchase 
price, $325,000, as the property value, even though that official had previously 
determined the value for 2006 to be only $116,700.  The Sapinas sought an 
allocation of the purchase price to reduce the value of the realty, and the 
Cuyahoga County Board of Revision (“BOR”) reduced the value to $175,000.  
Both the owners and the Euclid City School District Board of Education (“school 
board”) appealed to the BTA, which held a hearing and issued a decision 
reinstating the $325,000 aggregate sale price as the value of the property. 
{¶ 3} The Sapinas have appealed to this court, and we conclude that the 
adoption of the full sale price is unreasonable and unlawful.  We therefore 
exercise our authority pursuant to R.C. 5717.04 to order that the value be 
modified to $160,000, an allocation supported by the mortgage loan secured by 
the real property. 
Facts 
A. Background 
{¶ 4} On December 1, 2005, Ivica and Katarina Sapina entered into a 
purchase agreement under which the Sapinas acquired real property plus a 
carryout restaurant.  The real property consisted of a lot improved with a two-
story building in Euclid, Ohio.  On the ground floor were two business spaces, 
one of which was occupied by a carryout restaurant that the Sapinas acquired as 
part of the deal.  The other first-floor commercial space was vacant.  Upstairs 
were two residential apartments let to tenants.  The sale was consummated in 
February 2006. 
{¶ 5} The purchase agreement set a contract price of $325,000 for all of 
the assets transferred under the agreement.  Appended to the agreement is a list of 
personal property acquired as part of the carryout business, which includes such 
items as a walk-in cooler, two freezers, and metal tables for food preparation.  
The purchase agreement also contains a two-year covenant not to compete by the 
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seller.  But the agreement sets forth no allocation of the aggregate purchase price 
to individual assets. 
B. Proceedings before the BOR 
{¶ 6} Although the original updated valuation for tax years 2006 and 
2007 had been $116,700, the school board obtained an increase to the full 
aggregate sale price of $325,000 for tax year 2006, which the auditor then carried 
forward to tax year 2007.  On January 7, 2008, the Sapinas filed a valuation 
complaint seeking a reduction to $125,000 for the 2007 tax year.  The school 
board filed a countercomplaint, seeking retention of the full purchase price as the 
value of the realty. 
{¶ 7} On February 11, 2009, the BOR held a hearing at which Katarina 
Sapina appeared and testified.  She also presented a written appraisal (but not 
testimony) of Donald Durrah, which found a value of $120,000 as of January 27, 
2009 (the tax-lien date was more than two years earlier, January 1, 2007).  Durrah 
performed a valuation under all three approaches and, placing the greatest weight 
on income capitalization, reconciled to a value of $120,000 as of January 27, 
2009. 
{¶ 8} Sapina presented additional documents at the BOR.  First, she 
introduced a mortgage dated February 24, 2006, which the Sapinas had given to 
their credit union in conjunction with the asset purchase.  The loan amount was 
$160,000 of the $325,000 purchase price.  Second, she presented correspondence 
showing the Sapinas’ attempts to amend the purchase agreement by allocating 
$160,000 to the realty and $165,000 to the personal property—although tendered 
to the sellers, the amendment was never signed.  Ms. Sapina testified that there 
was no downpayment, given the role of the credit union as mortgagee of the 
Sapinas’ house. 
{¶ 9} Delegates at the BOR requested that Ms. Sapina do research and 
work up a set of values for the used items of personal property listed on the 
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appendix to the purchase agreement, and she complied.  According to Sapina’s 
workup, the tangible personal property associated with the carryout business had a 
value of about $38,172.60. 
{¶ 10} Apparently based on Sapina’s workup, a review of the appraisal, 
and other evidence in the record, the BOR itself allocated $150,000 to personal 
property and treated the remainder, $175,000, as the value of the realty.  But the 
exact method by which the BOR reached that number is obscure; the BTA could 
not replicate the computation, and neither can we. 
C. Proceedings before the BTA 
{¶ 11} The BTA held a hearing at which the school board did not appear.  
Ms. Sapina again appeared and testified.  She also presented the written appraisal 
report and testimony of Richard Linhart.  Linhart performed an analysis under the 
income and sales comparison approaches to valuation and arrived, after 
reconciling the results of those two approaches, at a value of $100,000 as of 
January 1, 2007.  Linhart’s sole mention of the 2006 asset purchase was in a brief, 
one-paragraph section devoted to the history of the property:   Linhart noted that 
the property was “transferred for $325,000” to the Sapinas, that the “sale of 
$325,000 include [sic] the business and personal property ie; [sic] restaurant 
equipment,” and that “[t]he sale is currently under protest by the owners due to 
the inclusion of personal property with the real estate.”  The appraisal otherwise 
ignores the 2006 sale as a basis for determining the value of the realty as of 
January 1, 2007. 
{¶ 12} At the BTA hearing, Linhart offered his opinion as to using the 
$325,000 sale price as a basis for valuing the property:  “After looking at the 
Purchase Agreement I noticed all the personalty that was involved, including 
fixtures, and goodwill, and the noncompete clause, which all is value—has value 
to the subject business, not the real estate.”  Asked whether he thought the 
$325,000 sale price was “excessive for the property” that he had been hired to 
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appraise, Linhart said, “For the real estate, yes, sir.”  Asked whether he relied on 
the sale price in preparing his appraisal, Linhart testified, “Not at all.”  Later, the 
hearing examiner asked Linhart what materials he had reviewed in conjunction 
with the 2006 sale, and Linhart answered that he had reviewed the data in the 
county’s database, and the sales contract itself.  Linhart did not, however, review 
the conveyance-fee statement. 
{¶ 13} By mail, the school board submitted a copy of the conveyance-fee 
statement to the BTA prior to the hearing.  The document shows $325,000 being 
reported as consideration for the real property, while indicating that $160,000 was 
paid subject to a mortgage. 
{¶ 14} In its decision, the BTA cited the legal precepts that favor the use 
of a recent, arm’s-length sale price over an appraisal and noted that although the 
Sapinas had reported the entire $325,000 sale price as consideration paid for the 
realty, they now sought to prove that the reported amount was inaccurate.  Sapina 
v. Cuyahoga Cty. Bd. of Revision, BTA Nos. 2009-K-667 and 2009-K-816, 2012 
WL 1494009, *4 (Apr. 24, 2012).  On the basis of the cited case law, the BTA 
declined to accept the Linhart appraisal value.  As for allocating the purchase 
price, the BTA “[did] not question Ms. Sapina’s veracity or that items of personal 
property may have also been acquired as part of the sale,” but nonetheless found 
that “the evidence offered is insufficient to ‘unequivocally establish a basis for 
allocating a portion of the sale price to the personal property that was 
transferred.’ ”  Id., quoting Olentangy Local Schools Bd. of Edn. v. Delaware Cty. 
Bd. of Revision, 125 Ohio St.3d 103, 2010-Ohio-1040, 926 N.E.2d 302, ¶ 23.  The 
BTA also noted that the BOR had reduced the property value to $175,000, but 
stated that it was “unable to discern upon what evidence the BOR relied in doing 
so or replicate its finding of value.”   Id.  The BTA therefore felt constrained to 
reinstate the entire purchase price of $325,000 as the property value for tax year 
2007. 
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Analysis 
{¶ 15} “The fair market value of property for tax purposes is a question of 
fact, the determination of which is primarily within the province of the taxing 
authorities, and this court will not disturb a decision of the Board of Tax Appeals 
with respect to such valuation unless it affirmatively appears from the record that 
such decision is unreasonable or unlawful.”   Cuyahoga Cty. Bd. of Revision v. 
Fodor, 15 Ohio St.2d 52, 239 N.E.2d 25 (1968), syllabus.  But although the BTA 
is responsible for determining factual issues, we “ ‘will not hesitate to reverse a 
BTA decision that is based on an incorrect legal conclusion.’ ”  Satullo v. Wilkins, 
111 Ohio St.3d 399, 2006-Ohio-5856, 856 N.E.2d 954, ¶ 14, quoting Gahanna-
Jefferson Local School Dist. Bd. of Edn. v. Zaino, 93 Ohio St.3d 231, 232, 754 
N.E.2d 789 (2001).  Pursuant to R.C. 5717.04, the statute that creates the remedy 
of appeal to this court from decisions of the BTA, we may either reverse a 
decision of the BTA or modify it if we find that the decision is unreasonable or 
unlawful. 
{¶ 16} The present case confronts us with the issue whether the BTA 
acted reasonably and lawfully when it adopted the entire 2006 sale price, 
$325,000, as the value of the Sapinas’ property.  The primary alternative 
advanced by the Sapinas was an appraisal of the real property that ignored the 
2006 sale price and reached an opinion that the value was $100,000 on the tax-
lien date.  The issue presents a mixed question of law and fact, which makes it 
necessary to consider it within the legal framework developed in the case law for 
bulk-sale cases. 
A. The BTA applied the wrong standard in evaluating the  
evidence concerning allocation of the aggregate sale price 
{¶ 17} The BTA declined to make an allocation of the purchase price on 
the grounds that the record did not “unequivocally establish” the propriety of such 
an allocation.  The BTA derived that standard from Olentangy Local Schools, 125 
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Ohio St.3d 103, 2010-Ohio-1040, 926 N.E.2d 302, ¶ 23.  But as the cited passage 
from the decision shows, the property owner in Olentangy argued for an 
allocation to personal property before the court, but had not advanced that 
argument before the BTA.  Id. at ¶ 24.  Thus, Olentangy Local Schools involved 
the application, on appeal, of a plain-error standard:  because the owner had 
waived allocation, only plain error could be corrected on appeal.  See Plain Local 
Schools Bd. of Edn. v. Franklin Cty. Bd. of Revision, 130 Ohio St.3d 230, 2011-
Ohio-3362, 957 N.E.2d 268, ¶ 20-21. 
{¶ 18} By stark contrast, the Sapinas have consistently argued for 
allocation.  Accordingly, the applicable standard is whether the record contains 
“corroborating indicia” or “best available evidence” that supports an allocation of 
the aggregate purchase price.  St. Bernard Self Storage, L.L.C. v. Hamilton Cty. 
Bd. of Revision, 115 Ohio St.3d 365, 2007-Ohio-5249, 875 N.E.2d 85, ¶ 17 (“In 
bulk-sale cases, we typically look for corroborating indicia to ensure that the 
allocation reflects the true value of the property”); Hilliard City Schools Bd. of 
Edn. v. Franklin Cty. Bd. of Revision, 128 Ohio St.3d 565, 2011-Ohio-2258, 949 
N.E.2d 1, ¶ 18, 27 (using “best available evidence” in the form of a bank appraisal 
of personal property to determine allocation of asset purchase price to the 
personal property). 
{¶ 19} Applying the more relaxed standard—that a proposed allocation 
need only be “corroborated”—makes the proper inquiry a very different one. 
B. Using the entire aggregate sale price to value the realty was error 
1. Under the case law, an allocation of the aggregate sale price is  
preferred to an appraisal that ignores the sale 
a. Using sale price to determine value 
{¶ 20} At the time at issue in this case, former R.C. 5713.03 stated that 
when “determining the true value of any tract, lot, or parcel of real estate,” the 
county auditor in his role as tax assessor “shall consider the sale price of such 
SUPREME COURT OF OHIO 
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tract, lot, or parcel to be the true value for taxation purposes,” if the sale was an 
“arm’s length” one that had occurred “within a reasonable time, either before or 
after the tax lien date.”  (Emphasis added.)  1983 Am.Sub.H.B. No. 260, 140 Ohio 
Laws, Part II, 2722.  The court has construed this provision as a legislative 
mandate that a recent arm’s-length sale price be used as the criterion of the 
property’s value unless the opponent of using the sale price can mount a 
successful challenge to the arm’s-length character or the recency of the sale.  See 
Cummins Property Servs., L.L.C. v. Franklin Cty. Bd. of Revision, 117 Ohio St.3d 
516, 2008-Ohio-1473, 885 N.E.2d 222, ¶ 13, citing Berea City School Dist. Bd. of 
Edn. v. Cuyahoga Cty. Bd. of Revision, 106 Ohio St.3d 269, 2005-Ohio-4979, 834 
N.E.2d 782.  That mandate entails the rejection of appraisal evidence of the value 
of the property whenever a recent, arm’s-length sale price has been offered as 
evidence of value.  Id. 1 
{¶ 21} Dovetailing with the Berea line of cases is the case law addressing 
the situation in which real property is transferred as part of a larger sale that 
includes other assets than the parcel at issue—a situation that the court has 
                                                 
1 In their reply brief and at oral argument, the Sapinas argued that the court should apply the 
version of R.C. 5713.03 as amended by Am.Sub.H.B. No. 487, eff. September 10, 2012, as itself 
amended by Am.Sub.H.B. No. 510, eff. March 27, 2013.  H.B. 487 amended R.C. 5713.03 to state 
that the auditor “may” use the arm’s-length sale price, rather than stating that the auditor “shall” 
do so.  On the one hand this is a belated argument that would usually be barred by not having been 
timely raised.  However, the legislation is brand new, so the argument could not have been raised 
earlier.  In any event, we find that the amendment is inconsequential in this case.  If H.B. 487 and 
H.B. 510 constitute a clarification of prior law, we are justified in applying the case law under 
former R.C. 5713.03 without according the new statute any great significance.  Alternatively, 
amended R.C. 5713.03 may have substantively changed the law—but if that is so the case law 
establishes that we must apply the substantive tax law that was in effect during the tax year at 
issue—i.e., tax year 2007.   See Giant Tiger Drugs, Inc. v. Kosydar, 43 Ohio St.2d 103, 107-108, 
330 N.E.2d 917 (1975) (applying sales-tax exemption law in effect during the audit period—i.e., 
the period when the transactions occurred that were subject to taxation—and declining to apply a 
later amendment to the exemption); Akron Home Medical Servs., Inc. v. Lindley, 25 Ohio St.3d 
107, 110, 495 N.E.2d 417 (1986) (same). 
 
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referred to as a “bulk sale” in a nontechnical sense.2  In the bulk-sale area, the 
court has adhered to “two overarching principles.”  FirstCal Indus. 2 Acquisitions, 
L.L.C. v. Franklin Cty. Bd. of Revision, 125 Ohio St.3d 485, 2010-Ohio-1921, 929 
N.E.2d 426, ¶ 17.  First, the “ ‘best evidence of “true value in money” is the 
proper allocation of the lump-sum purchase price and not an appraisal ignoring 
the contemporaneous sale.’ ”  Id., quoting Conalco, Inc. v. Monroe Cty. Bd. of 
Revision, 50 Ohio St.2d 129, 363 N.E.2d 722 (1977), paragraph two of the 
syllabus.  In this context, the court has said that “[t]he crucial issue that arises in 
proposing the use of an allocated sale price is the propriety of the allocation for 
tax-valuation purposes.”  (Emphasis sic.)  Bedford Bd. of Edn. v. Cuyahoga Cty. 
Bd. of Revision, 132 Ohio St.3d 371, 2012-Ohio-2844, 972 N.E.2d 559, ¶ 20.  
Accordingly, a proposed allocation of purchase price must typically be supported 
by “ ‘corroborating indicia’ ” that establish the propriety of the allocation.  Id., 
quoting St. Bernard Self Storage, L.L.C. v. Hamilton Cty. Bd. of Revision, 115 
Ohio St.3d 365, 2007-Ohio-5249, 875 N.E.2d 85, ¶ 15-19. 
{¶ 22} The second of the two overarching principles is that “ ‘the BTA is 
not required, in every instance, and in all events, to accept as the true value in 
money of real property, an allocation of a portion of a lump-sum purchase price 
paid for a group of assets which included the property in question.’ ”  FirstCal, 
¶ 18, quoting Consol. Aluminum Corp. v. Monroe Cty. Bd. of Revision, 66 Ohio 
St.2d 410, 414, 423 N.E.2d 75 (1981).  In a situation in which the propriety of the 
allocation has not been shown, the BTA must choose between two alternatives.  
Either the BTA uses the entire purchase price as the criterion of value for the 
                                                 
2 There is some reason to think that the Sapinas might have overpaid in the aggregate for the 
assets.  That issue would ultimately concern the arm’s-length character of the sale, which calls for 
a seller and buyer who act with “knowledge of all the relevant facts.’ ”  See Worthington City 
Schools Bd. of Edn. v. Franklin Cty. Bd. of Revision, 129 Ohio St.3d 3, 2011-Ohio-2316, 949 
N.E.2d 986, ¶ 22, fn. 2, quoting Ohio Adm.Code 5703-25-05(A)(1) and (2).  But because the 
Sapinas have never contended that they did not properly inform themselves and therefore overpaid 
for the assets, we do not address the issue.  Id.   
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property or the BTA disregards the purchase price and looks at other evidence of 
value (such as an appraisal of the parcel at issue).  Compare St. Bernard Self 
Storage, 115 Ohio St.3d 365, 2007-Ohio-5249, 875 N.E.2d 85 (entire purchase 
price in excess of $25,000 allocation to personal property held to constitute the 
value of the property), with Consol. Aluminum, 66 Ohio St.2d at 414. 
{¶ 23} This second course of action is not appropriate in this case.  
Consol. Aluminum Corp. involved a sale of an entire business division with 
numerous assets, consisting of real and personal property, the latter both tangible 
and intangible, located both in and outside Ohio.  The court accepted the BTA’s 
finding that because of  “complexities of the sale,” it was “not possible to make an 
allocation of a portion of a lump-sum purchase price paid for Olin’s entire 
aluminum division to the Hannibal property.”  66 Ohio St.2d at 414.  No such 
complexities have been found to exist in this case, which is much more 
straightforward. 
b. The BTA’s duty is to (i) weigh evidence and (ii) determine value 
{¶ 24} In the present case, the auditor used the aggregate sale price to set 
the value for the property for tax year 2007, and the BOR ordered a reduction 
whose basis was obscure.  The case law provides guidance as to how the BTA 
should act when a board of revision decision has been appealed. 
{¶ 25} One principle of general importance is that the BTA has the duty, 
in a real-property-valuation case, to “ ‘ “independently weigh and evaluate all 
evidence  properly before it” ’ in arriving at its own decision.”  Vandalia-Butler 
City Schools Bd. of Edn. v. Montgomery Cty. Bd. of Revision, 130 Ohio St.3d 291, 
2011-Ohio-5078, 958 N.E.2d 131, ¶ 13, quoting Hilliard City Schools Bd. of Edn. 
v. Franklin Cty. Bd. of Revision, 128 Ohio St.3d 565, 2011-Ohio-2258, 949 
N.E.2d 1, ¶ 17, quoting Columbus Bd. of Edn. v. Franklin Cty. Bd. of Revision, 76 
Ohio St.3d 13, 15, 665 N.E.2d 1098 (1996). 
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{¶ 26} The “first rule” in an appeal from the board of revision is that “the 
party challenging the board of revision’s decision at the BTA has the burden of 
proof to establish its proposed value as the value of the property.”  Colonial 
Village Ltd. v. Washington Cty. Bd. of Revision, 123 Ohio St.3d 268, 2009-Ohio-
4975, 915 N.E.2d 1196, ¶ 23, citing Dayton-Montgomery Cty. Port Auth. v. 
Montgomery Cty. Bd. of Revision, 113 Ohio St.3d 281, 2007-Ohio-1948, 865 
N.E.2d 22, ¶ 15.  Here both the Sapinas and the school board appealed from the 
reduced valuation determined by the BOR; the Sapinas shouldered the burden of 
showing a lower value, while the school board relied on the sale information to 
assert the propriety of using the sale price. 
{¶ 27} A special situation is presented when the record as developed 
“negates the validity of the county’s valuation of the property.”  Colonial Village, 
¶ 24.  In that situation, the BTA acquires “the legal duty * * * to determine 
whether the record as developed by the parties contain[s] sufficient evidence to 
permit an independent valuation of the property” by the BTA.  Id. at ¶ 25.  If the 
record contains such evidence, the BTA should perform an independent valuation.  
Id. 
{¶ 28} Finally, when performing an independent valuation, the BTA is not 
bound by the values advocated by the parties—indeed, the statutory language 
calls for the BTA on appeal from the BOR to “determine the taxable value of the 
property.”  R.C. 5717.03(B).  The same language in R.C. 5717.05 has been 
construed by this court, in the context of an appeal from the board of revision to 
the common pleas court:  the taxpayer’s valuation complaint “places neither 
minimum nor maximum limitations on the court’s determination of value, and 
there are none save the judicial requirement that the determination be supported 
by the evidence.”  Jones & Laughlin Steel Corp. v. Lucas Cty. Bd. of Revision, 40 
Ohio St.2d 61, 63, 320 N.E.2d 658 (1974), cited with approval in Cleveland Elec. 
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Illum. Co. v. Lake Cty. Bd. of Revision, 80 Ohio St.3d 591, 596, 687 N.E.2d 723 
(1998). 
2. The appraisal the Sapinas offered at the BTA ignores the 2006 sale price 
{¶ 29} The Sapinas attempted to show an allocation by presenting an 
appraisal of the real property itself as of the tax-lien date, January 1, 2007.  That 
appraisal determined the value to be $100,000.  For three reasons, the BTA acted 
properly in rejecting the appraisal as definitive evidence of value. 
{¶ 30} First, allowing the appraisal as the principal or sole means of 
allocating the aggregate purchase price violates the precept that an appraisal of 
realty should not substitute for the arm’s-length sale price.  More typically, an 
allocation of sale price is proper when the value of personal property has been 
determined and subtracted from the aggregate price, thereby leaving the 
remainder of the sale price as the value of the realty.  See Hilliard City Schools, 
128 Ohio St.3d 565, 2011-Ohio-2258, 949 N.E.2d 1. 
{¶ 31} Second, $100,000 seems an unduly low valuation in light of the 
entire record.  The auditor originally valued the property at $116,700 for tax year 
2006, before applying the 2006 asset-purchase price to 2007; the credit union was 
willing to use the realty as collateral for a $160,000 loan; and the appraisal 
presented at the BOR determined that the value was $120,000 in January 2009. 
{¶ 32} Third, assigning only $100,000 to the property means that more 
than two-thirds of the $325,000 aggregate price—$225,000—reflects the value of 
tangible and intangible personal property, which the record does not support and 
which seems implausible. 
{¶ 33} For all these reasons, the BTA correctly declined to rely on the 
Linhart appraisal. 
3. The BTA correctly rejected the BOR’s reduced valuation 
{¶ 34} Once the Linhart appraisal was ruled out, the BTA was left to 
choose between (i) reverting to the auditor’s valuation, which used the entire 
January Term, 2013 
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aggregate sale price to value the realty, (ii) adopting the BOR’s reduced valuation, 
and (iii) performing an independent valuation based on the record. 
{¶ 35} The BTA correctly ruled out using the BOR’s reduced value, 
because it could not replicate it.  This court has emphatically held that the BTA’s 
independent duty to weigh evidence precludes a presumption of validity of the 
BOR’s valuation.  Vandalia-Butler City Schools, 130 Ohio St.3d 291, 2011-Ohio-
5078, 958 N.E.2d 131, ¶ 13. 
4. The record negated the auditor’s use of the aggregate sale price,  
while also furnishing a basis for independent valuation 
{¶ 36} The record also strongly negates using the entire $325,000 asset-
purchase price as the value of the realty.  Just as the Linhart appraisal opinion of 
$100,000 seems low, $325,000 appears well above all other indications of value 
in the record, and the sale did manifestly include personal property assets that had 
some value.  Thus, the BTA’s decision to revert to the aggregate sale price is 
unreasonable and unlawful under the circumstances. 
{¶ 37} Although the Sapinas have understandably aimed to obtain the 
lower values found by their appraisers—$120,000 in the Durrah appraisal 
presented to the BOR and $100,000 in the Linhart appraisal presented to the 
BTA—they have created a record that demonstrates an allocated value that is 
higher:  $160,000.  Namely, the loan secured by the mortgage was a $160,000 
loan, meaning that the lender viewed the property as having sufficient value to 
serve as collateral for that loan amount, and the Sapinas were apparently not 
required to make a downpayment.  The propriety of using this figure as the 
allocated value of the real property satisfies the standard of “corroborating 
indicia,” and the breakout of the $160,000 amount secured by the mortgage is 
reflected both on the conveyance-fee statement and in the mortgage instrument 
presented as an exhibit before the BOR. 
SUPREME COURT OF OHIO 
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{¶ 38} We have previously had occasion to order a modified allocation of 
purchase price under analogous circumstances.  In Hilliard City Schools, 128 
Ohio St.3d 565, 2011-Ohio-2258, 949 N.E.2d 1, a motel was purchased as an 
ongoing business.  Accordingly, the assets involved in the purchase included  (1) 
the real property itself, (2) the personal-property furnishings of the motel rooms, 
which fall into the category of “furniture, fixtures & equipment” (“FF&E”), (3) 
certain more transient inventory items, and (4) an alleged transfer of the right to 
use the hotel-chain name and logo.  The aggregate purchase price was $3,600,000. 
{¶ 39} In Hilliard, the BTA had authorized an allocation to FF&E from 
the aggregate sale price of an entire motel as a going concern.  The BTA relied on 
a year-end financial statement to sustain an $800,000 allocation to the FF&E.  In 
reviewing the BTA’s decision, we determined that because the basis for the 
financial statement was unexplained and because it was prepared long after the 
purchase, the BTA’s reliance on it was unreasonable and unlawful.  That was 
particularly true, given that a bank appraisal contemporaneous to the purchase 
attached a value of $280,000 to the FF&E. 
{¶ 40} On appeal, we concluded that “the $280,000 figure in the appraisal 
report constitutes the best available evidence for the value of the FF&E,” 
emphasizing that “the issue before us is what value the parties attached to the 
personal property in connection with the sale of the hotel as a going concern.”  Id. 
at ¶ 27.  We noted that “the December 2004 appraisal presents an estimation of 
value apparently relied upon by [the purchaser’s] lender” and that at the time of 
sale it was “within the contemplation of the parties.”  Id. 
{¶ 41} Similarly, as to the property at issue here, the negotiation of the 
credit-union loan and the closing of the entire purchase agreement occurred in the 
time frame December 2005 through February 2006.  The loan amounts were 
within the contemplation of the parties, and furnish corroboration for an allocation 
to realty that seems plausible within the entire context of the transaction.  That 
January Term, 2013 
15 
 
plausibility becomes more compelling in the present context, where the totality of 
the evidence strongly militates against adopting the entire aggregate sale price as 
the value of the realty. 
Conclusion 
{¶ 42} For the foregoing reasons, the BTA properly rejected the BOR’s 
reduction of value but acted unreasonably and unlawfully by reverting to the 
entire aggregate sale price as the value of the realty.  Pursuant to R.C. 5717.04, 
we therefore order that the value of the property for tax year 2007 be modified to 
$160,000. 
Judgment accordingly. 
O’CONNOR, C.J., and PFEIFER, O’DONNELL, LANZINGER, KENNEDY, 
FRENCH, and O’NEILL, JJ., concur. 
____________________ 
 
Siegel Jennings Co., L.P.A., Victor Anselmo, J. Kieran Jennings, and 
Jason P. Lindholm, for appellant. 
 
Britton, Smith, Peters & Kalail Co., L.P.A., Karrie M. Kalail, and Michael 
E. Stinn, for appellee Euclid City School District Board of Education. 
 
Timothy J. McGinty, Cuyahoga County Prosecuting Attorney, and 
Saundra Curtis-Patrick, Assistant Prosecuting Attorney, for appellees Cuyahoga 
County Board of Revision and Cuyahoga County Fiscal Officer. 
________________________