[Cite as Nichols v. Bixler , 2021-Ohio-129.]

COURT OF APPEALS STARK COUNTY, OHIO FIFTH APPELLATE DISTRICT

BEVERLY S. NICHOLS, ET AL. : JUDGES: : Hon. Patricia A. Delaney, P.J. Plaintiffs-Appellees : Hon. Craig R. Baldwin, J. : Hon. Earle E. Wise, Jr., J. -vs- : : JEFFREY J. BIXLER, INDIVIDUALLY : Case No. 2020 CA 00037 AND AS TRUSTEE OF THE JO L. : BIXLER TRUST : : Defendant-Appellant : O P I N I O N

CHARACTER OF PROCEEDING: Appeal from the Court of Common Pleas, Probate Division, Case No. 226829

JUDGMENT: Affirmed

DATE OF JUDGMENT: January 20, 2021

APPEARANCES: For Plaintiffs-Appellees For Defendant-Appellant

TIMOTHY J. MOORE CRAIG T. CONLEY 4505 Stephen Circle, NW 604 Huntington Plaza Suite 101 220 Market Avenue South Canton, OH 44718 Canton, OH 44702

RYAN J. MELEWSKI 105 North Broad Street Canfield, OH 44406Stark County, Case No. 2020 CA 00037 2

Wise, Earle, J. {¶ 1} Defendant-Appellant, Timothy J. Bixler, individually and as trustee of the Jo L. Bixler Trust, appeals several judgment entries, culminati ng in the February 14, 2020 findings of fact, conclusions of law, and judgment of the Court of Common Pleas of Stark County, Ohio, Probate Division, on the issue of agricu ltural use value and valuation. Plaintiffs-Appellees are Beverly S. Nichols and Ant hony Nichols.

FACTS AND PROCEDURAL HISTORY {¶ 2} The decedent, Jo L. Bixler, had four children, Jeffrey Bi xler, appellant Timothy Bixler, Pamela Rose Bixler, and appellee Beverly Nichol s. On March 17, 2013, Jo Bixler executed a Restatement of Trust Agreement for the ben efit of his four children plus his grandson, appellee Anthony Nichols. The trust provide d in pertinent part that upon his death, his son Jeffrey was to receive the first option to purchase the trust's real property "based upon the agricultural use value of said real es tate." The subject property consists of several parce ls north of Hartville, Ohio, totaling approximately 290 acres. A portion of the property contains a life estate for th e benefit of Pamela. {¶ 3} Jo Bixler passed away on January 30, 2014. Jeffrey was n amed

successor trustee. {¶ 4} Jeffrey exercised his option and believed "agricultural u se value" equaled the current agricultural use value (hereinafter "CAUV") as dete rmined by the local auditors. Appellees contested the value, claiming "agricultura l use value" meant what a willing buyer would pay a willing seller for land where its bes t use is agricultural. Appellees obtained a higher appraisal from a certified farm rea l estate appraiser. {¶ 5} On August 10, 2016, appellees filed a complaint for decla ratory judgment for determination on the meaning of the trust language among ot her requests. AStark County, Case No. 2020 CA 00037 3 hearing was held on May 31, 2017. By journal entry filed July 18, 2017, the trial court found "agricultural use value" to be ambiguous and determined J o Bixler's intent to mean "the price that a willing farmer would pay a farmer willin g to sell the collected properties as a farm, if the use was restricted to farming purp oses." The trial court ordered updated appraisals of the subject properties and remove d Jeffrey as successor trustee. Jeffrey's removal was affirmed on appeal. Nichols v. Bixler, 5th Dist. Stark No. 2017CA00152, 2018-Ohio-3234. Timothy became second successor t rustee. {¶ 6} Following the appeal to this court, a new trial court jud ge was assigned to the case. On February 28, 2019, appellant filed a motion for p artial reconsideration on the issue of "agricultural use value." By judgment entry filed June 7, 2019, the trial court

denied the motion. {¶ 7} A hearing on valuation of the trust properties was held o n November 22, 2019. By judgment entry filed January 8, 2020, the trial court determined the agricultural use value of the properties to be $6,300 per acre. {¶ 8} By judgment entry filed January 30, 2020, the trial court approved an inventory and account as modified by the January 8, 2020 judgme nt entry. The total value of the properties was listed as $1,806,399. {¶ 9} By findings of fact, conclusions of law, and judgment fil ed February 14, 2020, the trial court confirmed the agricultural use value to b e $6,300 per acre for 286.2119 acres, and clarified that the residential use property subject to the life estate was valued at $16,000. {¶ 10} Appellant filed an appeal and this matter is now before this court for consideration. Assignments of error are as follows:Stark County, Case No. 2020 CA 00037 4

I {¶ 11} "THE TRIAL COURT, THROUGH ITS JULY 18, 2017 AND JUNE 7, 2019 ENTRIES, ERRED IN ITS CONSTRUCTION OF THE TRUST TERM 'AGRICULTU RAL

USE VALUE'."

II {¶ 12} "THE TRIAL COURT, THROUGH ITS JANUARY 8, JANUARY 30 AND FEBRUARY 14, 2020 ENTRIES, OTHERWISE ERRED IN SETTING THE VALUE OF

THE TRUST'S AGRICULTURAL USE PROPERTY."

I {¶ 13} In his first assignment of error, appellant claims the t rial court erred in its construction of the term "agricu ltural use value." We disagree

. {¶ 14} Our standard of review of the trial court's decision on declaratory judgment is de novo, Arnott v. Arnott, 132 Ohio St.3d 401, 2012-Ohio-3208, 972 N.E.2d 586, ¶

14:

The determination of the meaning of the disputed language of t he trust at the heart of this case is a question of law. "A court 's purpose in interpreting a trust is to effectuate, within the legal paramet ers established by a court or by statute, the settlor's intent." Domo v. McCarthy, 66 Ohio St.3d 312, 612 N.E.2d 706 (1993), paragraph one of the syllabus

. Interpreting a trust is akin to interpreting a contract; as wit h trusts, the role of courts in interpreting contracts is "to ascertain and give e ffect to the intent of the parties." Saunders v. Mortensen, 101 Ohio St.3d 86, 2004- Ohio-24, 801 N.E.2d 452, ¶ 9. This court has held that "[t]he constructionStark County, Case No. 2020 CA 00037 5

of a written contract is a matter of law that we review de novo ." Id. The same is true of the construction of a written trust; in both In re Trust of Brooke, 82 Ohio St.3d 553, 697 N.E.2d 191 (1998), and Natl. City Bank v. Beyer, 89 Ohio St.3d 152, 729 N.E.2d 711 (2000), this court applied a de novo standard of review in interpreting trust language in appea ls of declaratory judgments.

{¶ 15} Language in an agreement can be "ambiguous if it is uncl ear, indefinite, and reasonably subject to dual interpretations or is of such do ubtful meaning that reasonable minds could disagree as to its meaning." Beverly v. Parilla, 165 Ohio App.3d 802, 2006-Ohio-1286, 848 N.E.2d 881, ¶ 24 (7th Dist.). When the language is ambiguous, "there arises a factual question, and the court may consider extrinsic or parol evidence to ascertain the intent behind the language." Id. at ¶ 26. "Extrinsic evidence includes the circumstances surrounding the parties at the time the contract was made and the objectives they intended to accomplish by ente ring the contract." Cadle v. D'Amico, 7th Dist. Mahoning No. 15 MA 0136, 2016-Ohio-4747, ¶ 24, citing Oryann, Ltd. v. SL & MB, L.L.C., 11th Dist. No. 2014-L-119, 2015-Ohio-5461. A decision on factual issues will not be reversed if it is suppor ted by some competent,

credible evidence. C.E. Morris Co. v. Foley Construction Co., 54 Ohio St.2d 279, 376 N.E.2d 578 (1978). {¶ 16} The trust provision at issue, Section 6.2 - Option to Pu rchase, states the following in pertinent part:Stark County, Case No. 2020 CA 00037 6 It is my intention and direction that my trust estate, after p ayment of all taxes and expenses pursuant to Section 5.2 hereof, be divid ed among my beneficiaries as set forth in Section 6.3 below. Such divis ion of property may be made in money, units of Bixler & Son, LLC, or o ther property at my Trustee's sole discretion, and need not be pro-r ata distributions of particular types of property. The Trustee sha ll exercise these powers of distribution in a fiduciary capacity primarily in the interests of the beneficiaries, subject to the valuation of units of Bixl er & Son, LLC,

as directed below. I hereby give and grant to my son, Jeffrey J. Bixler, the firs t right and option to purchase any or all of the units of Bixler & Son, LLC, owned by me held in my trust within 18 months after my death at a val uation based upon the underlying value of real estate owned by Bixler & Son, LLC. The valuation of said units shall be based upon the agricultural use

value of said real estate, and each unit shall have a value of one-o nehundredth (1/100) of the total value of such real estate holdin gs. It is my intention and direction that Jeffrey J. Bixler shall have the r ight and authorization to purchase said units even though he may be serv ing as Fiduciary and Trustee of my Trust estate at the time of purchas e. (Emphasis added.)

{¶ 17} Appellant argues the term "agricultural use value" is no t ambiguous and means the CAUV as determined by the local auditors. CAUV is a technical term for land valued in accordance with R.C. 5713.31 which governs asses sing agricultural landStark County, Case No. 2020 CA 00037 7 for real property tax purposes. The value is commonly below tr ue market value for working farms. The CAUV is based on Ohio's soil types, crop yi eld, and land capability. Ohio Adm.Code 5703-25-33. The CAUV tables are determined yearl y and are subject to change. {¶ 18} In support of his argument, appellant cites the case of Fahncke v. Fahncke, 3d Dist. Auglaize No. 2-19-05, 2020-Ohio-433. In Fahncke, a written contract between parents and their seven children gave the oldest child the right to purchase the family farm at fair market value upon the deaths of the parents . The agreement went on to state that the appraiser shall appraise the property at its agricultural use value unless the appraiser knew that the property would not be used for farm ing, then the fair market

value would apply. The trial court determined the property should be valued at its fair market value at current market value and not at its agricultura l use value or current agricultural use value, reasoning that the absence of the word "current" in conjunction with "agricultural use value" in the agreement was dispositive. On appeal, our colleagues from the Third District disagreed, finding the absen ce of the word "current" was not dispositive as the trial court's decision "rendered the term agricultural-use value and the contingency clause in the parties' agreement meaningles s." Fahncke at ¶ 25.

The Fahncke court determined the terms in the agreement were not ambiguous

. {¶ 19} The issue in Fahncke was fair market value versus agricultural use value.

The Fahncke court determined the absence of the word "current" did not cha nge the

intent of the valuation to one of fair market value. In the ca se sub judice, the issue is the technical CAUV versus agricultural use value or "farmer to farmer value" (what a willing buyer would pay a willing seller for farm land for agri cultural use). No one is asserting fair market value at current market value for the pro perty. Appellant claimedStark County, Case No. 2020 CA 00037 8 the value for the properties was the CAUV value of $600,000 ver sus appellees' farmer

to farmer value of 2.1 million. T. at 4-5. {¶ 20} In its journal entry filed July 18, 2017, the trial cour t determined the decedent was a sophisticated landowner who was well aware of Oh io's use of CAUV to determine real property tax values and had he intended for the properties to be appraised pursuant to the CAUV value, he would have used that t erm in the trust. The trial court stated "the term 'agricultural use value' is not sy nonymous with the technical term 'current agricultural use value.' " The trial court looke d to extrinsic evidence "to aid in the interpretation of the trust language." We agree the ter m "agricultural use value" as used in the subject trust agreement is ambiguous and turning to extrinsic evidence to determine the decedent's intent was proper. {¶ 21} Attorney E. Lang D'Atri, a childhood friend of the deced ent for "70 plus years" and his attorney, testified he prepared all of his estat e planning documents including the trust agreement in question. T. at 9-10, 12, 33, 34; Plaintiff's Exhibit 1. He and the decedent discussed the term "agricultural use value" as used in the trust. T. at 16. Based on those discussions, Attorney D'Atri understood the term to mean "[w]hat a willing buyer, willing seller, would trade exchange land at fai r market farming value.

Two farmers in other words what would it sell for between two f armers at a Kiko

auction." T. at 17. When asked if the decedent's intent was t o use CAUV values, Attorney D'Atri testified "[n]o, absolutely not." T. at 27. T he decedent understood what the CAUV was and that it involved soil testing. Id. The decedent "was only interested in what a willing buyer and willing seller would pay for farming f or agricultural use." Id. Attorney D'Atri went over several valuations with the decedent via "a summary of what 100 percent valuation was, the thirty five percent access value by the auditor and alsoStark County, Case No. 2020 CA 00037 9

CAUV." T. at 28; Plaintiff's Exhibit K. The decedent was not interested in any of those

valuations. Id. When the trust was first established, the decedent was concer ned about tax liability after his passing. T. at 19, 21-22. Once the la w changed in Ohio abolishing estate tax, the decedent's focus shifted to family planning "an d the equitable division of his property among the children." T. at 23-24, 27-28. {¶ 22} Jeffrey was unaware of the trust agreement prior to his father's death and had never discussed the meaning of the term "agricultural use v alue." T. at 114, 150- 151, 153. Timothy and Pamela both testified they understood th e term to mean the CAUV value or lower value. T. at 179, 181-183. {¶ 23} The trial court found Attorney D'Atri's testimony to be credible and determined "agricultural use value" as used in Section 6.2 of t he trust meant "the price that a willing farmer would pay a farmer willing to sell the co llected properties as a farm." Journal Entry filed July 18, 2017. The trial court sta ted this definition furthers the decedent's intent to provide for the other b eneficiaries. This decision was upheld by the subsequent trial court judge upon reconsideration. Judgment En try filed June 7, 2019. {¶ 24} With the decedent being gone, having his attorney who pr epared the trust agreement is next best in this case. Attorney D'Atri was a lif elong friend and had

numerous conversations with the decedent about his intentions f or his properties. Attorney D'Atri was diligent in counseling the decedent on diff erent valuations and he could recall what his understanding was of the decedent's wishe s. {¶ 25} Upon review, we find the original trial court judge did not err in the construction of the term "agricultural use value" as used in th e subject trust agreement, and the subsequent trial court judge did not err in denying the motion for partial

reconsideration.Stark County, Case No. 2020 CA 00037 10 {¶ 26} Assignment of Error I is denied.

II {¶ 27} In his second assignment of error, appellant claims the trial court erred in setting the values for the properties. We disagree. {¶ 28} An appellate court will not reverse a trial court's valu ation if it is supported by some competent, credible evidence. C.E. Morris, supra ; Seasons Coal Co. v. Cleveland, 10 Ohio St.3d 77, 461 N.E.2d 1273 (1984). {¶ 29} A hearing on valuation was held on November 22, 2019. T he trial court heard from two expert appraisers, John Emig for appellant and R oger Sours for appellees. Mr. Emig opined the properties had an agricultural use value of $5,000 per acre for an approximate total of $1.4 million. T. at 157, 233; Trustee Exhibit 1. Mr. Sours opined the value was $7,500 per acre for an approximate t otal of $2.1 million. T. at 35, 233; Plaintiff's Exhibits A and B. In its judgment entr ies filed January 8, and 30, 2020, the trial court found the agricultural use value of the p roperties to be $6,300 per acre with a total value of $1,806,399. In its findings of fact and conclusions of law and judgment filed February 14, 2020, the trial court found the fol lowing in pertinent part:

1. Neither expert witness could locate sale prices for real es tate matching the Trust property. 2. Both expert witnesses relied on adjusted real estate sales prices that they inferred were comparable to the market value for the Trust property.Stark County, Case No. 2020 CA 00037 11 7. Sale price per acre range from $5,600 to $11,378 in Exhibit s A and B [Sours Appraisal] and that, after adjustments, the adjust ed range is from $6,239 to $10,269 per acre. 8. Sale price per acre range in Trust Exhibit #1 [Emig Apprais al] is from $1,430 to $6,757 and that, after adjustments, the adjusted range is from $2,503 to $7,794 per acre. 9. From the assumptions and limiting conditions explained in Exhibits A and B, and Trust Exhibit #1, real estate appraising is not an exact science and, like beauty, might be in the eyes of the beh older. 10. The strength and soundness of the witnesses' testimony is influenced by their qualifications, the comparable properties t hat they used, their interpretation of the similarities of the comparabl e properties to the Trust property, and the reasonableness of their conclusions since none of the comparables properties are matches to the Trust pro perty. 15. The Trust property should be attractive to a farmer willin g to purchase a 286 acre farm because it is an operating family farm in Stark and Portage Counties where there is easy access to farm markets and suppliers, transportation and population centers.

{¶ 30} The trial court acknowledged that Mr. Sours appraised th e properties in two separate groups as opposed to collectively, and Mr. Emig ap praised the properties collectively and appraised the life estate property at $16,000. Findings of Fact Nos. 12

and 13.Stark County, Case No. 2020 CA 00037 12 {¶ 31} On cross-examination, Mr. Sours indicated he did not sep arately value the life estate property in his appraisal. T. at 49. He admitted a property with a life estate would lessen the value of the property. T. at 50-51. He agree d that considering the life estate would have had a negative impact on the $7,500 per acre value. T. at 53. There was no testimony as to how much it would have lowered the per a cre valuation; however, on redirect pertaining to the life estate, Mr. Sours w as asked if he had any "reason to believe that it would be substantially more of a det riment to the rest of the property" and he replied in the negative. T. at 133. Mr. Emig valued the approximate half acre life estate property at $16,000 and treated it as "a separate component of the total valuation." T. at 154, 156-157. Each appraiser explaine d at length how they arrived at their respective valuations using comparables and ma king adjustments. {¶ 32} The trial court's final decision on valuation was set fo rth in Findings of Fact No. 16: "After a thorough review of the evidence, the Court has found that the agricultural use value of the Trust real property as of January 30, 2014 was $6,300 per acre for the 286.2119 acres and $16,000 for the property subjec t to the life estate." {¶ 33} The trial court did not give any further explanation as to how it settled on the $6,300 per acre valuation; however, said valuation is on th e low end of the adjusted range in the Sours appraisal and on the high end of the adjuste d range in the Emig appraisal. Additionally, we point to the trial court's Finding s of Fact No. 14:

Both Mr. Emig and Mr. Sours considered the West Township, Columbiana property a comparable sale. Mr. Emig took the sale price of $6,757 per acre and, after adjustment, reduced the price to $5, 499 per acre. Whereas, Mr. Sours took the sale price of $6,860 per acr e, afterStark County, Case No. 2020 CA 00037 13 adjustment, increased the price to $7,889 per acre. Value indi cators are subject to interpretation. 1 (Footnote added by this court for clarification.)

{¶ 34} In specifically highlighting the sole comparable propert y used by both experts, the trial court obviously found this property signific ant in its analysis. 2 The trial court's valuation of $6,300 per acre falls very neatly within t he midrange of the experts' appraisals of this comparable property. It appears the trial c ourt was "splitting the difference" of both the overall range of the valuations of all the properties in the appraisals as well as giving extra attention to the sole compar able property used by both experts. We cannot find the trial court's decision is not supported by the record. {¶ 35} We have considered appellant's arguments regarding Mr. S ours's failure to follow the trial court's "marching orders" and find them to lack merit. It is clear the trial court acknowledged Mr. Sours's methodology and took it in to consideration by not adopting the valuation in his appraisal. Findings of Fact Nos. 12 and 13. {¶ 36} Upon review, we find the trial court did not err in its valuation of the trust properties. {¶ 37} Assignment of Error II is denied.

1 The discrepancy in the starting point of the sale price per acr e ($6,757 versus $6,860) is explained by the use of two different total acreage numbers for the property. Mr. Emig used 60.676 acres while Mr. Sours used 59.761 acres. Divi ding the sale price of the property, $410,000, by the two different acreages result in the $103 difference in price per acre before each expert made his respective adjustmen ts. 2 The property is located at 9188 Lowmiller Road, West Township, Columbiana County, Ohio. Mr. Sours used this property in his appraisals as Sale # 1; Plaintiff's Exhibits A, pages 35, 39; Plaintiff's Exhibit B, pages 32, 35. Mr. Emig us ed this property as Sale #3; Trust Exhibit 1, pages 73, 82.Stark County, Case No. 2020 CA 00037 14

{¶ 38} The judgment of the Court of Common Pleas of Stark Count y, Ohio, Probate Division is hereby affirmed. By Wise, Earle, J. Delaney, P.J. and Baldwin, J. concur.

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