Court Opinion

ID: 2707187
Source: CourtListenerOpinion
Date Created: 2014-08-05 13:24:57.769478+00
Date Added: 2024-06-11T12:14:27.399740
License: Public Domain

[Cite as Columbus City Schools Bd. of Edn. v. Franklin Cty. Bd. of Revision, 2013-Ohio-4504.]

                             IN THE COURT OF APPEALS OF OHIO

                                   TENTH APPELLATE DISTRICT

Board of Education of the                            :
Columbus City Schools,
                                                     :
                 Appellant-Appellee,
                                                     :
v.                                                                          No. 12AP-682
                                                     :                  (BTA No. 2009-Q-932)
Franklin County Board of Revision and
The Franklin County Auditor,                         :               (REGULAR CALENDAR)

                 Appellees-Appellees,                :

(Kaufmann Executive Drive, LLC et al.,               :

                 Appellees-Appellants).              :

                                         D E C I S I O N

                                    Rendered on October 10, 2013

                 Rich & Gillis Law Group, Mark H. Gillis and Kelley A. Gorry,
                 for appellee Board of Education of the Columbus City Schools.

                 Shumaker, Loop & Kendrick, LLP, W. Reed Hauptman,
                 Scott R. Branam, and Adam M. Galat, for appellants
                 Kaufmann Executive Drive, LLC and Checkers Drive-In
                 Restaurants, Inc.

                              APPEAL from the Board of Tax Appeals

DORRIAN, J.
        {¶ 1} Appellees-Appellants, Kaufmann Executive Drive, LLC ("Kaufmann"), and
Checkers Drive-In Restaurants, Inc. ("Checkers") (collectively "appellants"), appeal from
a decision and order of the Board of Tax Appeals ("BTA") determining the taxable value of
certain real property for tax year 2008. Because we conclude that the BTA's decision was
not unreasonable or unlawful, we affirm.
No. 12AP-682                                                                                2

       {¶ 2} The real property that is the subject of this appeal consists of two adjacent
parcels located in the Columbus City School District taxing district. The parcels contain a
fast-food restaurant and an adjacent parking lot. As of 2007, the property was owned by
an entity called Baker/MCB, LLC ("Baker"), while another entity, called Setla, LLC
("Setla") operated the fast-food restaurant on the property under a lease agreement. In
2007, Setla negotiated a purchase of the property from Baker for $275,000 (the "Baker-
Setla sale"). The limited warranty deed evidencing this transaction was time-stamped by
the Franklin County Recorder's Office on May 8, 2007, at 3:53 p.m. Setla subsequently
entered into a sale and leaseback transaction of the property with Kaufmann (the "Setla-
Kaufmann sale and leaseback transaction"). In the sale component of the transaction,
Kaufmann purchased the property from Setla for $675,000 (the "Setla-Kaufmann sale").
The leaseback component of the transaction provided that Setla would lease the property
from Kaufmann for a twenty-year term, with options to renew for four five-year terms,
under a "triple-net lease" (the "Setla-Kaufmann lease agreement"). The limited warranty
deed evidencing the Setla-Kaufmann sale was time-stamped by the Franklin County
Recorder's Office on May 8, 2007, at 3:54 p.m.
       {¶ 3} The Franklin County Auditor ("Auditor") calculated the total value of both
parcels as being $216,800. Appellant-appellee, the Columbus City School District Board
of Education ("Board of Education"), filed a complaint with the Franklin County Board of
Revision ("BOR"), against the valuation of the property for tax year 2007, asserting that
the property should have been valued at $675,000 based on the price paid in the Setla-
Kaufmann sale. Setla filed a counter-complaint, asserting that the Auditor's valuation of
$216,800 should be retained because the Setla-Kaufmann sale did not constitute an
arm's-length transaction. The BOR ultimately increased the valuation of the parcel
containing the fast-food restaurant for tax year 2007 and 2008, thereby increasing the
total property valuation to $275,000 for both tax years.
       {¶ 4} The Board of Education appealed the BOR's decision to the BTA. Because
the parties indicated that they did not dispute the BOR's valuation decision for tax year
2007, the BTA limited its analysis to determining the proper valuation for tax year 2008.
       {¶ 5} While the BTA appeal was pending, Setla was also involved in bankruptcy
proceedings in a federal bankruptcy court in the state of Delaware. As part of the
No. 12AP-682                                                                                3

bankruptcy proceedings, Checkers assumed Setla's obligations under the Setla-Kaufmann
lease agreement. Checkers filed a motion for substitution with the BTA seeking to
substitute itself for Setla. The BTA denied Checkers' motion for substitution and
subsequent motion for reconsideration of the order denying its motion for substitution.
       {¶ 6} With respect to the merits of the appeal, the BTA concluded that both the
Baker-Setla sale and the Setla-Kaufmann sale were arm's-length transactions. The BTA
further held that, because the Setla-Kaufmann sale was more recent to the tax lien date
for tax year 2008, the price paid in that sale constituted the best evidence of the property's
value as of January 1, 2008. Therefore, the BTA concluded that the total value of the
property for tax year 2008 was $675,000 and ordered the BOR to assess taxes on the
property in conformance with that valuation.
       {¶ 7} Appellants appeal from the BTA's decision and order, assigning ten errors
for this court's review:
              [1.] The Decision and Order of the BTA is unreasonable and
              unlawful because it determined "the true value of each
              separate tract, lot, or parcel of real property and of buildings,
              structures, and improvements located thereon" in a manner
              that is inconsistent with the legislative intent expressed by the
              Ohio General Assembly in R.C. 5713.03 and R.C. 5701.02.

              [2.] The Decision and Order of the BTA is unreasonable and
              unlawful because it fails to comply with R.C. 5713.03 by
              determining the value of real property based upon
              transactions that were not entered at arm's-length.

              [3.] The Decision and Order of the BTA is unreasonable and
              unlawful because it determines the value of the real property
              based upon the anticipated business success, good-will, and
              creditworthiness of a tenant under a lease, rather than the
              [sic] determining the value of the underlying real property,
              buildings, structures, and improvements.

              [4.] The Decision and Order of the BTA is unreasonable and
              unlawful because it determines the value of the real property
              by applying a rigid, bright-line rule, instead of considering the
              unique circumstances of this case and determining value
              based upon the weight and sufficiency of the evidence, which
              involves two separate transactions entered only one-minute
              apart.
No. 12AP-682                                                                               4

              [5.] The Decision and Order of the BTA is unreasonable and
              unlawful because it determines the value of the real property
              based upon an easily identifiable financing transaction that is
              separable from the underlying value of the real property.

              [6.] The Decision and Order of the BTA is unreasonable and
              unlawful because the BTA lacked jurisdiction to render such a
              decision.

              [7.] The Decision and Order of the BTA is unreasonable and
              unlawful because the due process rights of Checkers were
              violated when the BTA twice denied a meaningful opportunity
              to be heard to Checkers, the entity who will ultimately be
              responsible for paying the real estate taxes under an assigned
              lease that was the subject of an order issued by the United
              States Bankruptcy Court of the District of Delaware.

              [8.] The Decision and Order of the BTA is unreasonable and
              unlawful because it constitutes a collateral attack on an order
              issued by the United States Bankruptcy Court of the District of
              Delaware.

              [9.] The Decision and Order of the BTA is unreasonable and
              unlawful because it violates an order issued by the United
              States Bankruptcy Court of the District of Delaware.

              [10.] The Decision and Order of the BTA is unreasonable and
              unlawful because it failed to consider the arguments that
              Checkers would have presented with respect to the impact of
              the former tenant's bankruptcy proceedings on the potential
              liability of Checkers.

       {¶ 8} An appellate court reviews a decision of the BTA to determine whether it is
reasonable and lawful. HIN, L.L.C. v. Cuyahoga Cty. Bd. of Revision, 124 Ohio St. 3d 481,
2010-Ohio-687, ¶ 13. "It is well settled that [an appellate] court will defer to factual
determinations of the BTA if the record contains reliable and probative support for them."
Strongsville Bd. of Edn. v. Wilkins, 108 Ohio St. 3d 115, 2006-Ohio-248, ¶ 7. The Supreme
Court of Ohio has held that the fair market value of a property for tax purposes is a
question of fact and that a reviewing court will not disturb a decision of the BTA with
respect to the valuation unless it affirmatively appears from the record that the decision is
unreasonable or unlawful. Worthington City Schools Bd. of Edn. v. Franklin Cty. Bd. of
Revision, 129 Ohio St. 3d 3, 2011-Ohio-2316, ¶ 18. "The BTA's findings of fact are to be
No. 12AP-682                                                                                               5

affirmed if supported by reliable and probative evidence, and the BTA's determination of
the credibility of witnesses and its weighing of the evidence are subject to a highly
deferential abuse-of-discretion review on appeal." Id.
        {¶ 9} In their first five assignments of error, appellants challenge the BTA's
decision, arguing that it was unreasonable and unlawful in the way that the BTA
calculated the value of the property. Because the first five assignments of error are
interrelated, we will address them together.1
        {¶ 10} Under R.C. 5713.03, when a property "has been the subject of an arm's
length sale between a willing seller and a willing buyer within a reasonable length of time
either before or after the tax lien date, the auditor may consider the sale price of [the
property] to be the true value for taxation purposes." The Supreme Court of Ohio has held
that, under this statute "when [a] property has been the subject of a recent arm's-length
sale between a willing seller and a willing buyer, the sale price of the property shall be 'the
true value for taxation purposes.' " Berea City School Dist. Bd. of Edn. v. Cuyahoga Cty.
Bd. of Revision, 106 Ohio St. 3d 269, 2005-Ohio-4979, ¶ 13, quoting R.C. 5713.03. When a
school board seeks an increase in property valuation, the presentation of basic evidence of
a sale and the sale price creates a rebuttable presumption that the sale price reflects the
value of the property. This places a burden on the owner to rebut that presumption. N.
Royalton City School Dist. Bd. of Edn. v. Cuyahoga Cty. Bd. of Revision, 129 Ohio St. 3d
172, 2011-Ohio-3092, ¶ 11. "Under Berea, [a recent, arm's-length] sale price is deemed to
be the value of the property, and the only rebuttal lies in challenging whether the elements
of recency and arm's-length character between a willing seller and a willing buyer are
genuinely present for that particular sale." Cummins Property Servs., L.L.C. v. Franklin
Cty. Bd. of Revision, 117 Ohio St. 3d 516, 2008-Ohio-1473, ¶ 13.
        {¶ 11} Appellants argue that the Setla-Kaufmann sale was not an arm's-length
transaction and that, therefore, the BTA acted unreasonably and unlawfully by adopting
the Setla-Kaufmann sale price as the value of the property. Appellants claim that the
Setla-Kaufmann sale and leaseback transaction was a "financing transaction" which did

1 Although appellants appear to raise various arguments in their first through fifth assignments of error,

appellants' brief focuses only on the arm's-length transaction issue, specifically asserting that the parties
were related and that the sale lacked open-market elements. Therefore, we will limit our discussion to the
same.
No. 12AP-682                                                                               6

not reflect the true value of the property. They assert that the Baker-Setla sale, by
contrast, was an arm's-length transaction and that, because the Baker-Setla sale was
recorded only one minute before the Setla-Kaufmann sale, it reflects the true value of the
property.
       {¶ 12} An arm's-length transaction has three primary characteristics: (1) it is
voluntary; (2) it takes place on the open market; and (3) the parties act in their own self-
interest. N. Royalton at ¶ 24. Appellants concede that there was no evidence of collusion
between Setla and Kaufmann, thus demonstrating that the transaction was voluntary, but
argue that the parties did not act in their own self-interest because they were related and
that the sale did not occur on the open market. Therefore, we will consider the self-
interest and open-market aspects of the Setla-Kaufmann sale and leaseback transaction.
       {¶ 13} "The allegation that parties to a sale are related bears on whether they are
self-interested for purposes of R.C. 5713.03. That is so because related parties may be
pursuing the identical interest of common owners rather than acting as separately
interested, typically motivated actors in the marketplace." N. Royalton at ¶ 33. The
Supreme Court of Ohio has acknowledged that, although related parties can make
property transfers at fair market prices, "a sale transacted between related parties should
not qualify as the criterion of value without an affirmative demonstration that the price
actually reflects fair market value in spite of the relationship of the parties." Id.
       {¶ 14} Appellants argue that Setla and Kaufmann were related parties and that the
BTA's decision was unreasonable and unlawful because the Board of Education did not
make an affirmative demonstration that the sale price reflected the fair market value of
the property. Appellants assert that Setla and Kaufmann were related parties based on the
fact that Kaufmann previously purchased a property in Arkansas where Setla operated a
fast-food restaurant franchise. Appellants also claim that the Setla-Kaufmann sale and
leaseback transaction created buyer-seller and landlord-tenant relationships between the
parties. The BTA found that, despite their business relationship, Setla and Kaufmann each
acted in its own self-interest in conducting the transaction.
       {¶ 15} In several cases, the Supreme Court of Ohio has affirmed BTA decisions
ruling that the sale price from a sale-leaseback transaction did not establish the true value
of the relevant property. See S. Euclid/Lyndhurst Bd. of Edn. v. Cuyahoga Cty. Bd. of
No. 12AP-682                                                                              7

Revision, 74 Ohio St. 3d 314 (1996); Cleveland Hts./Univ. Hts. Bd. of Edn. v. Cuyahoga
Cty. Bd. of Revision, 72 Ohio St. 3d 189 (1995); Kroger Co. v. Hamilton Cty. Bd. of
Revision, 67 Ohio St. 3d 145 (1993). The court explained the potential concerns arising
from a sale-leaseback transaction in Cummins Property Servs. The court noted that a
sale-leaseback transaction may be designed to avoid property tax and that a willing buyer
would pay less for a property if the leaseback limited the amount of rent that could be
collected from the property. Id. at ¶ 30. Appellants argue that this case presents the
converse of Cummins—i.e., Kaufmann was willing to pay a higher price for the property
because of the increased rental rate under the triple-net lease. However, in two more
recent decisions, the court concluded that a sale-leaseback transaction could constitute an
arm's-length transaction for valuation purposes. See CCleveland OH Realty I, L.L.C. v.
Cuyahoga Cty. Bd. of Revision, 121 Ohio St. 3d 253, 2009-Ohio-757; AEI Net Lease
Income & Growth Fund v. Erie Cty. Bd. of Revision, 119 Ohio St. 3d 563, 2008-Ohio-
5203.
        {¶ 16} The AEI case involved a similar scenario to the present appeal. The property
in question contained a restaurant operated by Apple American Group ("Apple
American"). In 2003, Apple American bundled the property together with 25 other
properties and sold them to an entity called Preco. Preco then leased the properties back
to Apple American. AEI at ¶ 4-5. The lease for the property at issue was a triple-net lease
with a twenty-year term and multiple five-year renewal options, with specified rental rates
for the term of the lease in five-year increments. Id. at ¶ 6. Preco subsequently sold the
relevant property to AEI for $2,788,658 in May 2004. The county auditor set a tax value
of $896,040 for the property. The local school district filed a complaint requesting that
the May 2004 sale price be used as the value of the property. The county board of revision
adopted the sale price as the value; the BTA also adopted the sale price as the value of the
property. Id. at ¶ 8-9. On appeal, the Supreme Court of Ohio rejected the argument that
the long-term lease imposed under the sale-leaseback transaction elevated the sale price
of the property beyond its actual worth. The Supreme Court held that "the fact that [a]
property is encumbered by a long-term lease does not by itself establish that the sale price
must be adjusted to arrive at true value." Id. at ¶ 13. Moreover, "[t]o the extent that an
existing long-term lease generates revenue above or below market, the existence of the
No. 12AP-682                                                                             8

lease will tend to increase or decrease the value of the fee interest in the property." Id.
The Supreme Court affirmed the BTA's decision adopting the sale price as the value of the
property. Id. at ¶ 30.
       {¶ 17} Although facts in AEI involved a second sale of the property after the sale-
leaseback transaction, we find the court's reasoning useful in examining this appeal. In
AEI, the Supreme Court considered whether the initial sale-leaseback transaction
constituted an arm's-length transaction. Id. at ¶ 21. The Supreme Court explained that
"the concern associated with sale-leaseback transactions lies in collusion between the
parties to depress property value for tax purposes." Id. at ¶ 20. The Supreme Court
concluded that the sale-leaseback in AEI was an arm's-length transaction because each
party "manifestly pursued its objective to obtain maximum value from the transaction."
Id. at ¶ 21. As the Supreme Court explained:
              For its part, Apple American sought to realize the value of the
              fee interest by selling the real property to obtain operating
              capital; on the other side of the deal, Preco sought to realize
              value from purchasing the fee interest by encumbering the
              property with a lease that provided a stream of rent income—
              income that would allow Preco to sell the property at a
              premium in the net-lease market. The fact that the rent rose
              in accordance with the amount of cash "financing" that Apple
              American desired does not mean that the sale-leaseback,
              taken as a whole, is anything but an arm's-length transaction.

Id. See also CCleveland at ¶ 7 ("Nothing in the record of this case raises [the concern of
collusion between the parties to depress property value for tax purposes]; indeed,
CCleveland's central objection arises because the parties to the sale-leaseback succeeded
in maximizing the value of the realty: the seller received an elevated sale price and, as
consideration, committed to paying the purchaser a stream of elevated lease payments,
which in turn allowed the purchaser to fetch a greater sale price later on.").
       {¶ 18} The BTA concluded that the Setla-Kaufmann sale and leaseback transaction
was analogous to the sale-leaseback in AEI and that each party to the transaction acted in
its own self-interest. The evidence in the record supports the BTA's conclusion. Ben C.
Kaufmann, a member of Kaufmann Executive Drive, LLC, testified at the BTA hearing
that, because of a prior sale of another property, he needed to engage in a "1031
No. 12AP-682                                                                                              9

exchange"2 for tax purposes and that the purchase of the property involved in this case
was part of that process. Mr. Kaufmann further testified that, in the transaction, "I was
interested in the rent I was going to get, the rate of return." (BTA Tr. 37.) Similarly, in
their brief, appellants assert that "Kaufmann needed to complete a 1031 like-kind
exchange, while Setla needed to obtain operating capital." (Appellant's Brief, 34-35.) As
in AEI, the record demonstrates that Setla and Kaufmann each "manifestly pursued its
objective to obtain maximum value from the real property interests in the transaction."
AEI at ¶ 21.
        {¶ 19} Appellants assert that the AEI decision is distinguishable because, in AEI,
the parties to the sale-leaseback transaction had no prior relationship. However, as the
Supreme Court of Ohio explained in the N. Royalton decision, the concern with "related
parties" in a property transfer is that they "may be pursuing the identical interest of
common owners rather than acting as separately interested, typically motivated actors in
the marketplace." N. Royalton at ¶ 33. In this case, evidence in the record demonstrates
that each party to the Setla-Kaufmann sale and leaseback transaction was acting in its
own self-interest and seeking to maximize the value it received from the transaction.
Therefore, we conclude that the BTA's decision was not unreasonable and unlawful in
concluding that Setla and Kaufmann were not "related parties" such that the Setla-
Kaufmann sale would not constitute an arm's-length transaction.
        {¶ 20} Appellants also argue that the Setla-Kaufmann sale and leaseback
transaction was not an arm's-length transaction because it did not occur on the open
market. Appellants assert that Setla identified Kaufmann as a potential investor based on
their landlord-tenant relationship in Arkansas and that there was no evidence that anyone
other than Kaufmann was notified that Setla sought to sell the property. In N. Royalton,
the Supreme Court explained that, while an arm's-length transaction generally occurs on
the open market, "[t]he case law does not condition character of a sale as an arm's-length
transaction on whether the property was advertised for sale or was exposed to a broad
range of potential buyers." Id. at ¶ 29. The Supreme Court noted that there was a long

2Mr. Kaufmann's reference to a "1031 exchange" appears to refer to Section 1031 of the Internal Revenue
Code, "which provides for nonrecognition and tax deferral of gain or loss that is realized from the exchange
of qualified business or investment opportunity." Bedford Bd. of Edn. v. Cuyahoga Cty. Bd. of Revision, 132
Ohio St. 3d 371, 2012-Ohio-2844, fn.2.
No. 12AP-682                                                                             10

line of BTA decisions applying the court's case law to "private sales" which established
that the absence of open-market elements did not necessarily negate the arm's-length
nature of a transaction. Id. at ¶ 30. As explained above, we find that there is evidence in
the record to support the BTA's conclusion that the Setla-Kaufmann sale and leaseback
transaction was an arm's-length transaction. Although the Setla-Kaufmann sale may have
been analogous to a "private sale" because there is no evidence that the property was
made available for sale to anyone other than Kaufmann, we conclude that the absence of
open-market elements does not negate the other indicia that this was an arm's-length
transaction.
       {¶ 21} We conclude that there was reliable and probative evidence in the record to
support the BTA's determination that the Setla-Kaufmann sale was an arm's-length
transaction. Although the Baker-Setla sale and the Setla-Kaufmann sale were recorded
only one minute apart, the Setla-Kaufmann sale was recorded later and therefore closer in
time to the tax lien date for tax year 2008. The BTA's decision that the Setla-Kaufmann
sale price represented the true value of the property under R.C. 5713.03 was not
unreasonable and unlawful.
       {¶ 22} Accordingly, we overrule appellants' first through fifth assignments of error.
       {¶ 23} Next, we turn to appellants' seventh and tenth assignments of error, which
assert that the BTA erred by denying Checkers' motion for substitution. In their seventh
assignment of error, appellants assert that the BTA violated Checkers' due process rights
by denying the motion for substitution. Similarly, in their tenth assignment of error,
appellants claim that the BTA's order is unreasonable and unlawful because the BTA
failed to consider the arguments that Checkers would have presented.
       {¶ 24} In its order denying Checkers' motion for substitution, the BTA referred to
its own earlier cases holding that a property owner has a right under R.C. 5715.19(A) to
file a complaint against the valuation of a property but that a lessee does not. The BTA
also cited court decisions holding that a property owner has a right to participate as an
appellee in BTA proceedings whether or not the owner filed a complaint before the BOR.
The BTA acknowledged the Supreme Court of Ohio's holding in Toledo Pub. Schools Bd.
of Edn. v. Lucas Cty. Bd. of Revision, 124 Ohio St. 3d 490, 2010-Ohio-253, that a property
management company could file a valuation complaint as an agent of the property owner
No. 12AP-682                                                                               11

under the terms of its management agreement. Citing a portion of a lease agreement
contained in the record, however, the BTA concluded that Checkers, as the party that
assumed Setla's obligations under the lease, was not an agent of the property owner and
denied the motion to substitute.
       {¶ 25} Checkers moved for reconsideration, arguing that the BTA cited a provision
of an old lease agreement, not the Setla-Kaufmann lease agreement that it assumed under
the federal bankruptcy proceedings. Checkers argued that, under the relevant provision of
the Setla-Kaufmann lease agreement, the lessee was an agent of the property owner and
had express authorization to pursue property valuation adjustments.
       {¶ 26} The BTA denied Checkers' motion for reconsideration. The BTA
acknowledged that the lessee under the Setla-Kaufmann lease agreement was expressly
authorized to seek tax reductions on behalf of the property owner, thereby implicitly
recognizing that it relied on the wrong lease in its initial decision. However, the BTA
concluded that this provision of the lease agreement did not overcome case law holding
that only owners have standing to pursue property valuation complaints. In its order
denying the motion for reconsideration, the BTA failed to reconcile this conclusion with
the holding in Toledo Pub. Schools that, under certain circumstances, an agent may
pursue a valuation challenge on behalf of a property owner, which it had cited in its earlier
decision. Thus, it appears that the BTA may have erred in denying the motion for
reconsideration of the order denying Checkers' motion for substitution.
       {¶ 27} Assuming for purposes of analysis that the BTA erred by denying Checkers'
motion for substitution, we conclude that such error was harmless. As explained above,
the relevant issue for determining the property valuation was whether the Setla-
Kaufmann sale and leaseback transaction was an arm's-length transaction. Checkers only
became involved in this transaction when it agreed to assume Setla's obligations under
the Setla-Kaufmann lease as part of Setla's bankruptcy proceedings in federal court. In
their brief, appellants assert that this assumption was approved by the federal bankruptcy
court on August 31, 2009. This was more than two years after Setla and Kaufmann
entered into the sale and leaseback transaction. Checkers has shown no evidence that it
had any information regarding the events leading to the Setla-Kaufmann sale and
leaseback transaction. In their brief, appellants assert that Checkers' interests were not
No. 12AP-682                                                                              12

represented in the BTA proceedings because Kaufmann was not involved in the
transaction between Setla and Checkers and had no knowledge of the negotiations leading
to Checkers' assumption of Setla's obligations under the lease agreement. However,
Checkers' understanding of its obligations under the lease agreement is not relevant to
whether the Setla-Kaufmann sale and leaseback transaction was an arm's-length
transaction. Further, both Checkers and Kaufmann had an opportunity to assert any
arguments regarding the nature of the Setla-Kaufmann sale and leaseback transaction as
part of this appeal. After reviewing those arguments, we concluded that it was an arm's-
length transaction.
         {¶ 28} Accordingly, we overrule appellants' seventh and tenth assignments of
error.
         {¶ 29} Finally, we conclude that appellant's sixth, eighth, and ninth assignments of
error fail to meet the requirements of the Ohio Rules of Appellate Procedure. "An
appellant must demonstrate each assigned error through an argument supported by
citations to legal authority and facts in the record." Ford Motor Credit Co. v. Ryan, 189
Ohio App. 3d 560, 2010-Ohio-4601, ¶ 23 (10th Dist.). If an appellant fails to separately
argue an assignment of error in its brief, the appellate court may disregard that
assignment of error. App.R. 12(A)(2). See also Ryan at ¶ 23 ("If an appellant neglects to
advance [an argument supported by citations to legal authority and facts in the record], a
court of appeals may disregard the assignment of error.").
         {¶ 30} Appellants' sixth assignment of error asserts that the BTA lacked
jurisdiction to render its decision. In their eighth assignment of error, appellants assert
that the BTA's decision is unreasonable and unlawful because it constitutes a collateral
attack on an order issued by a federal bankruptcy court. Similarly, in their ninth
assignment of error, appellants assert that the decision is unreasonable and unlawful
because it violates an order issued by that same federal bankruptcy court. However,
appellants brief contains no argument related to any of these assignments of error.
Moreover, with respect to the sixth assignment of error, appellants' counsel conceded at
oral argument that the BTA possessed jurisdiction over the case. Due to the lack of
authority and argument in support of appellants' sixth, eighth, and ninth assignments of
error, we will consider them to be waived. See Hamad v. Hamad, 10th Dist. No. 12AP-
No. 12AP-682                                                                         13

617, 2013-Ohio-2212, ¶ 25; Ryan at ¶ 23. Accordingly, we overrule the sixth, eighth, and
ninth assignments of error.
      {¶ 31} For the foregoing reasons, we overrule appellants' ten assignments of error
and affirm the decision of the Board of Tax Appeals.
                                                                     Decision affirmed.
                              KLATT, P.J., and SADLER, J., concur.
                                     _______________