Court Opinion

ID: 2781873
Source: CourtListenerOpinion
Date Created: 2015-02-25 13:04:40.96318+00
Date Added: 2024-06-11T12:10:33.769715
License: Public Domain

STATE OF MICHIGAN

                           COURT OF APPEALS

JENNIE NASS,                                                       UNPUBLISHED
                                                                   February 24, 2015
              Petitioner-Appellant,

v                                                                  No. 318437
                                                                   Michigan Tax Tribunal
TOWNSHIP OF SAUGATUCK,                                             LC No. 00-449475

              Respondent-Appellee.

Before: SHAPIRO, P.J., and GLEICHER and RONAYNE KRAUSE, JJ.

PER CURIAM.

       Petitioner appeals as of right the order of the Michigan Tax Tribunal (MTT) which
affirmed respondent-township’s denial of a principal residence exemption (PRE) on the subject
property during the tax years 2009, 2010, 2011, and 2012. Because the MTT’s decision was not
supported by competent, material, and substantial evidence, we reverse.

       “This Court’s ability to review decisions of the Tax Tribunal is very limited.” President
Inn Props, LLC v Grand Rapids, 291 Mich. App. 625, 630; 806 NW2d 342 (2011). “In the
absence of fraud, error of law or the adoption of wrong principles, no appeal may be taken to any
court from any final agency provided for the administration of property tax laws from any
decision relating to valuation or allocation.” Const 1963, art 6, § 28.

               While this Court is bound by the Tax Tribunal’s factual determinations
       and may properly consider only questions of law under this section, a Tax
       Tribunal decision that is not supported by competent, material, and substantial
       evidence on the whole record is an “error of law” within the meaning of Const
       1963, art 6, § 28. Oldenburg v Dryden Twp, 198 Mich. App. 696, 698; 499 NW2d
       416 (1993); Kern v Pontiac Twp, 93 Mich. App. 612, 620; 287 NW2d 603 (1979).
       Substantial evidence must be more than a scintilla of the evidence, although it
       may be substantially less than a preponderance of the evidence. Jones &
       Laughlin Steel Corp v City of Warren, 193 Mich. App. 348, 352-353; 483 NW2d
       416 (1992). “Substantial” means evidence that a reasonable mind would accept
       as sufficient to support the conclusion. Kotmar, Ltd v Liquor Control Comm, 207
Mich. App. 687, 689; 525 NW2d 921 (1994). [Great Lakes Div of Nat’l Steel Corp
       v Ecorse, 227 Mich. App. 379, 388-389; 576 NW2d 667 (1998).]

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Additionally, “[t]he appellant bears the burden of proof in an appeal from an assessment,
decision, or order of the Tax Tribunal.” ANR Pipeline Co v Dep’t of Treasury, 266 Mich. App.
190, 198; 699 NW2d 707 (2005).

        MCL 211.7cc and MCL 211.7dd govern Michigan’s PRE. EldenBrady v City of Albion,
294 Mich. App. 251, 256; 816 NW2d 449 (2011). “A principal residence is exempt from the tax
levied by a local school district[,]” MCL 211.7cc(1), and is defined as “the 1 place where an
owner of the property has his or her true, fixed, and permanent home to which, whenever absent,
he or she intends to return[,]” MCL 211.7dd(c).

         Petitioner and her husband bought property at 2614 Lakeshore Drive, Fennville,
Michigan in March 2006. In April 2008, petitioner filed a Homeowner’s Principal Residence
Exemption Affidavit stating that the Lakeshore Drive property became her principal residence in
February 2008. Petitioner stated that she lives at the Fennville property and visits her husband at
their Illinois home on some weekends. On December 11, 2012, respondent sent petitioner and
her husband a letter stating that the PRE for the Fennville property for 2009 through 2012 was
denied for the following reasons: “This property is not your principle [sic] residence and you are
receiving an exemption/tax credit in Illinois.” Petitioner appealed this denial to the MTT’s Small
Claims Division. A hearing referee recommended affirming respondent’s denial in a proposed
opinion and judgment. Petitioner filed exceptions to the proposed opinion and judgment. While
the MTT agreed with some of petitioner’s exceptions, it determined that they were not material
and affirmed respondent’s denial of petitioner’s request for a PRE. Petitioner appealed.

        Petitioner presented ample evidence that her Fennville property is “her true, fixed, and
permanent home to which, whenever absent, . . . she intends to return[,]” MCL 211.7dd(c), and,
therefore, she is entitled to a PRE as to that home. She presented utility bills demonstrating at
least two years of consistent usage at the Fennville property during the years at issue. She also
submitted her individual Michigan income tax returns for each year at issue. There was other
evidence to support the conclusion that the Fennville property is petitioner’s true, fixed, and
permanent home. Petitioner’s business is incorporated in Michigan, and all relevant business
documentation lists petitioner’s Fennville address. Petitioner’s vehicle is titled and registered in
Michigan at the Fennville address and insured in compliance with Michigan’s no-fault act.
Petitioner possesses a Michigan driver’s license which lists the Fennville address. Petitioner is
registered to vote in Michigan at the Fennville address. This evidence was more than sufficient
to meet petitioner’s burden of establishing that the Fennville address was “her true, fixed, and
permanent home to which, whenever absent, . . . she intends to return” during the tax years at
issue. MCL 211.7dd(c).

        More important is the fact that the record contains absolutely no evidence in support of
the respondent’s position. While our review of MTT decisions is limited, the MTT’s decision
must still be supported by “substantial” evidence. Great Lakes Div, 227 Mich. App. at 388-389.
Although “substantial” means less than a preponderance, it also means more than a mere
“scintilla” and must constitute “evidence that a reasonable mind would accept as sufficient” to
support the MTT’s conclusion. Id. Respondent presented two pieces of evidence: its answer and
the property record card for the Fennville property. The property record card does nothing to
suggest that the Fennville property is not petitioner’s principal residence; it merely establishes,
among other unrelated things, that the property is residential and owned by petitioner and her

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husband. Respondent’s answer is equally unpersuasive. It simply states that the reason for
denial of a PRE was that petitioner owns property in Illinois and that a PRE, or its Illinois
equivalent, was being received on both the Illinois and Fennville properties. First, owning
property in another state does nothing to deprive an individual of a Michigan PRE. Indeed, the
exemption itself is for an individual’s “principal” residence, not “only” residence. Second,
petitioner definitively established that she and her husband filed separate income tax returns
during the tax years at issue and this Court has ruled, consistent with the applicable statutes, that
a married party who files a separate income tax return may obtain a PRE on his or her principal
residence even if his or her spouse obtains a similar exemption in another state on another
property. Stege v Dep’t of Treasury, 252 Mich. App. 183, 195; 651 NW2d 164 (2002).
Accordingly, the MTT’s decision was not based on “substantial” evidence, particularly in light
of the voluminous evidence submitted by petitioner, and, therefore, constituted an “error of law”
under Const 1963, art 6, § 28. Great Lakes Div, 207 Mich. App. at 388-389.

        The decision of the MTT is reversed and we remand for entry of an order granting
petitioner’s request for a PRE on the subject property for the tax years at issue. We do not retain
jurisdiction.

                                                              /s/ Douglas B. Shapiro
                                                              /s/ Elizabeth L. Gleicher
                                                              /s/ Amy Ronayne Krause

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