Appeal of Sears, Roebuck & Co.
| Decision Date | 22 April 1953 |
| Docket Number | No. 7879,7879 |
| Court | Idaho Supreme Court |
| Parties | Appeal of SEARS, ROEBUCK & CO. BOARD OF COUNTY COM'RS OF ADA COUNTY v. SEARS, ROEBUCK & CO. |
Robert E. Smylie, Atty. Gen., J. N. Leggat, Asst. Atty. Gen., Blaine Evans, Pros. Atty., and Maurice H. Greene, Boise, for appellant.
Moffatt & O'Leary, Boise, for respondent.
The Assessor of Ada County assessed the stock of merchandise of respondent for the year 1950 in the sum of $178,350. Respondent protested and requested reduction of such assessment before the Board of Equalization of Ada County and contended that such assessment should not exceed $115,180. The Board of Equalization entered an order denying such protest and request for reduction, and sustaining and approving the assessment made by the county assessor.
Respondent appealed from the order of the County Board of Equalization to the State Tax Commission. The matter having been presented to the tax commission, it made an order affirming the order of the Board of Equalization of Ada County.
Respondent, under the provisions of Section 63-2214, I.C., appealed to the District Court of Ada County from the order of the State Tax Commission. A trial de novo was had in the district court and resulted in a judgment modifying the order of the State Tax Commission and reducing the assessment of the stock in trade of respondent for the year 1950 from $178,350 to $115,180. The judgment also directed the Tax Collector of Ada County to refund the excess taxes paid under protest by respondent. From such judgment appellant has appealed to this court.
Appellant, under its specifications of error, contends that the evidence is insufficient to support the following summarized findings of the court:
(1) That the assessor arrived at his assessment of respondent's stock in trade by measuring the floor space occupied by respondent in operating its business and comparing such floor space with the space occupied by other merchants; and by walking through respondent's store several times and looking at the merchandise on dates after the first three months of the year 1950; and that the assessor did not consider any other factor in making the assessment.
(2) That the assessor did not make any determination of the average value of respondent's stock in trade during the first three months of the year 1950.
(3) That the average value of respondent's stock in trade for the first three months of 1950 was $178,350 and the equalized value was $115,180.
Appellant further contends that the court erred in concluding, (a) that the assessment made by the assessor of respondent's stock in trade for the year 1950 was arbitrary, capricious and erroneous; and (b) that the stock in trade of respondent was not assessed equally in comparison to the stock in trade of other merchants in Ada County.
We will not consider the contentions of appellant separately as the answers to such contentions will appear in our discussion of the case as a whole.
Section 63-111, I.C., is the general statute defining the term 'value' as used in our assessment statutes. Such section reads as follows:
'By the term 'value,' 'cash value' or 'full cash value' is meant the value at which the property would be taken in payment of a just debt due from a solvent debtor, or the amount the property would sell for at a voluntary sale made in the ordinary course of business, taking into consideration its earning power when put to the same uses to which property similarly situated is applied.'
Section 63-202, I.C., recites additional criteria for determining value. It reads in part as follows:
'In ascertaining the value of any property the assessor shall not adopt a lower or different standard of value because the same is to serve as a basis of taxation, nor shall he adopt as a criterion any value or price for which the property would sell at auction or at forced sale, or in the aggregate with all the property in the taxing district; nor, on the other hand, shall he adopt a speculative valuation, or one based upon sales made upon the basis of a small cash payment and instalments payable in the future, but he shall value each article or piece of property by itself and at such sum or price as he believes the same to be fairly worth in money at the time such assessment is made.'
In the year 1950, Section 63-1207, I.C., since repealed, was in force and effect. Such section provided a special procedure for determining the value for assessment of the stock in trade of merchants. It read in part as follows:
'The stock in trade of any merchant shall be assessed upon the basis of its average value during the first three months of the year in which the taxes are levied or, if the merchant commences business during said three months' period, then the average value of the stock in trade during the remainder of said three months' period, and if a merchant commences business after the expiration of said three months' period he shall be assessed upon the basis of the value at the time the assessment is made.
Under the provisions of Section 63-1207, I.C., the Assessor of Ada County for the year 1950, sent to the merchants in such county for completion and return statements of valuation of personal property. Respondent completed and returned to such assessor its statement of valuation containing the following information:
"Total valuation of merchandise reported
to Idaho Income Tax Dept. and U. S.
Dept. of Internal Revenue for the last
fiscal year ........................ $300030
"Total Valuation of Merchandise on
hand, Feb. 1, 194 .................. $270442
"Total Valuation of Merchandise on
hand, Mar. 1, 194 ................. $293377"
The evidence at the trial disclosed that the physical inventory of respondent's stock in trade was taken on January 31, 1950, and revealed a total value in the sum of $270,442. The inventory value for December 31, 1949, of $300,030 was computed by adding the cost of sales and subtracting the purchases made during the month of January, 1950. The inventory value for March 1, 1950, in the sum of $293,377 was computed by the reverse method. The average valuation of respondent's stock in trade for the first three months of the year 1950 as shown by such inventories is the sum of $287,950. It is admitted that merchandise in Ada County is assessed by the assessor at 40% of its valuation. Forty percent of $287,950 is the sum of $115,180, being the proper amount of valuation for assessment found by the trial court.
The Assessor of Ada County assessed the stock in trade of respondent at $178,350 after having applied the equalization factor of 40% to the valuation of such stock in trade. How the assessor arrived at his valuation of the stock in trade of respondent is not too clear from his testimony. He testified that he accepted the statements of valuation received from some merchants but that other statements were not accepted. That where the statements of valuation were accepted, the three values reported were added together, divided by three and 40% thereof taken as the valuation for assessment. He further testified that he and a deputy went through the store of respondent on several occasions after the first three months of 1950 and compared the respondent's stock of merchandise with the stock of merchandise of other similar stores; and that they measured the floor space occupied by respondent and compared it with the floor space occupied by several other merchants. Under persistent questioning by counsel and by the court, the assessor testified as follows:
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'The Court: I am trying to figure out how just by viewing the premises and the square footage how $178,000 came up as a result of that.
There was put in evidence by stipulation a table showing the respective sums per square foot for which seven representative retail stores of Ada County were assessed for the year 1950. Such sums were obtained by dividing the square footage area occupied by each of such stores into the assessed valuation made by the assessor of the merchandise of such store. The factors thus obtained range from $1.70 per square foot to $3 per square foot. The factor shown for respondent is $1.79 per...
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