Court Opinion

ID: 6757242
Source: CourtListenerOpinion
Date Created: 2022-07-21 00:28:11.92705+00
Date Added: 2024-06-11T16:02:28.848379
License: Public Domain

Locher, J.,
dissenting. I agree with the majority that we should remand this case to the Board of Tax Appeals (“BTA”). I would, however, reverse.
*406The majority correctly states that the issue in this case is whether the BTA’s decision is unreasonable or unlawful. To resolve this issue, however, it is necessary to review the manner in which the BTA reached that decision.
The BTA is allowed “wide discretion in determining the weight to be given to evidence and the credibility of witnesses***.” Cardinal Federal S. & L. Assn. v. Bd. of Revision (1975), 44 Ohio St. 2d 13, paragraph three of the syllabus. Nevertheless, R. C. 5717.04 permits reversal of a BTA decision when it is “unreasonable or unlawful.” On direct appeal, this court has consistently reviewed the record before the BTA in order to determine whether there is evidence supporting the BTA’s decision. See, e.g., Cardinal Federal S. & L. Assn., supra; Citizens Financial Corp. v. Porterfield (1971), 25 Ohio St. 2d 53, 58; Ace Steel Baling v. Porterfield (1969), 19 Ohio St. 2d 137, 139; Bd. of Revision v. One Euclid Co. (1968), 16 Ohio St. 2d 43, 46; L. E. Shunk Latex Products, Inc., v. Evatt (1942), 140 Ohio St. 289, 292; Bd. of Education v. Evatt (1940), 136 Ohio St. 283, 286. Accordingly, the evidence before the BTA deserves a closer examination.
As stated by the majority, there were primarily two competing appraisals before the BTA. Youngstown Sheet and Tube Company (“YST”), appellant, offered an appraisal stating that the value of the property was $9,070,000. The Mahoning County Board of Revision (“MCBR”) submitted an appraisal in the amount of $27,898,700. The BTA determined the value of the property to be $17,774,000. This amount is approximately 48' percent of the sum of the appraisals submitted by the taxpayer and the board of revision.
In its decision and order, the BTA did not state any rationale or basis in the evidence leading to its conclusion. BTA merely stated that it reached this result “[ajfter carefully considering the entire record.”
On remand, BTA will realize the difficulty with this approach. The majority has ordered that BTA determine the value for each parcel at each of several locations. BTA, however, has merely stated a conclusory value, $17,774,000, without articulating the basis for this conclusion. It is difficult to imagine how one is to consistently establish a value for the parts when the process of evaluating the whole remains a *407mystery. Accordingly, result-oriented appraisals will be necessary. The total value of the parcels must equal the predetermined sum, $17,774,000, and appraisers may have to modify their estimates in order to conform to this constraint.
This court should encourage and uphold the integrity of the appraisal process. Appraisals are valuable evidentiary and administrative tools. Nevertheless, BTA’s approach taints the appraisal process. Taxpayers, tax collectors and appraisers well know that for every additional $1,000,000 one’s appraisal differs from that of an adversary BTA may fix a valuation which is approximately $500,000 closer to the desired extreme. Likewise, on remand, one has to be skeptical about the independence of an appraiser’s judgment when the total value of several parcels is fixed.
A closer examination of Cardinal Federal S. & L. Assn., supra, demonstrates how this result could have been avoided. In Cardinal, the taxpayer had recently purchased the last of several lots in the same area for development. Cardinal argued that the taxing authorities should adopt a four-year-old appraisal for its valuation. BTA, however, correctly preferred the sale value even though Cardinal’s other interests in the area might have increased the sale price. The question, therefore, was whether the sale price or appraisal value should control. This court has consistently held that the sale price is the best method for the “true value in money” of property. See, e.g., Conalco v. Bd. of Revision (1977), 50 Ohio St. 2d 129; State, ex rel. Park Investment Co., v. Bd. of Tax Appeals (1964), 175 Ohio St. 410, 412, certiorari denied 379 U.S. 818. It is in this context that the second paragraph of the syllabus in Cardinal, supra, reads: “The Board of Tax Appeals is not required to adopt the valuation fixed by any expert or witness.” (Emphasis added.) The Cardinal court correctly refused to put BTA in a theoretical strait jacket. That is, BTA is not required to accept any particular appraisal theory. BTA’s findings, however, must be based on the evidence in the record.
Finders of fact are often faced with difficult choices. They must decide which witnesses are more credible and how much weight to give to each item of evidence. In this case, however, BTA effectively chose the middle ground between a high *408appraisal from MCBR and a low one from YST. BTA seems to have merely added up the competing appraised values and divided by the number of parties. This approach has qualities similar to that of a quotient verdict. Jurors are not permitted to resolve a case through a quotient verdict because this process circumvents their duty to weigh the evidence in the record and make findings of fact. This analogy to a quotient verdict is compelling. Our abhorrence to BTA’s approach should be equally compelling.
In order to resolve the dispute between YST and MCBR, BTA contrived a Solomon-like solution. Rather than find the facts, BTA decided to split the difference. Regrettably, this is also a Solomon-like result — neither reasonable nor lawful.
Accordingly, I would reverse and remand for further proceedings consistent with this opinion.