Appeal of Land and Mineral Co.

• Decision Date: 02 December 1980
• Docket Number: No. 8024SC427,8024SC427
• Citation: 272 S.E.2d 878,49 N.C.App. 608
• Parties: In the Matter of the Appeal of LAND AND MINERAL COMPANY from the Valuation of Certain of Its Property, To Wit: 9,000 Acres of Mineral Rights By the Avery County County Board of Equalization and Review For 1978.
• Court: North Carolina Court of Appeals

Page 878

272 S.E.2d 878

49 N.C.App. 608

In the Matter of the Appeal of LAND AND MINERAL COMPANY from the Valuation of Certain of Its Property, To Wit: 9,000 Acres of Mineral Rights By the Avery County County Board of Equalization and Review For 1978.

No. 8024SC427.

Court of Appeals of North Carolina.

Dec. 2, 1980.

Adams, Hendon, Carson & Crow by Philip G. Carson, Asheville, for petitioner-appellee.

William B. Cocke, Jr., Newland, for respondent-appellant.

MORRIS, Chief Judge.

In this case we are asked to determine whether the Superior Court correctly determined that the evidence presented to the State Board did not support its conclusions.

Here, we must review the actions of a State administrative agency, and of the Superior Court which determined that the agency's conclusions were in error. When reviewing an order of a State agency such as the State Board, the Superior Court may not make findings contrary to the State Board's when the findings of the State Board are supported by "competent, material, and substantial evidence". In re Appeal of Amp, Inc., 287 N.C. 547, 561, 215 S.E.2d 752, 761 (1975), and cases cited therein.

G.S. 150A-51 specifies the scope of review and the power of the courts in disposing of a case appealed from the decision of a State agency. The statute provides in part:

The court may affirm the decision of the agency or remand the case for further proceedings; or it may reverse or modify the decision if the substantial rights of the petitioners may have been prejudiced because the agency findings, inferences, conclusions, or decisions are:

(5) Unsupported by substantial evidence admissible under G.S. 150A-29(a) or G.S. 150A-30 in view of the entire record as submitted; or

(6) Arbitrary or capricious.

Upon considering the judicial rule of Amp in conjunction with G.S. 150A-51 the standard of review derived therefrom, which we must apply in this case, is whether the decision of the State Board was supported by "competent, material, and substantial evidence".

The scope of judicial review of agency decisions required by G.S. 150A-51 has been construed by the Supreme Court in Thompson v. Board of Education, 292 N.C. 406, 233 S.E.2d 538 (1977). There the Court stated:

This standard of judicial review is known as the "whole record" test and must be distinguished from both de novo review and the "any competent evidence" standard of review. Universal Camera Corp. v. N.L.R.B., 340 U.S. 474, 71 S.Ct. 456, 95 L.Ed. 456 (1951); Underwood v. Board of Alcoholic Control, 278 N.C. 623, 181 S.E.2d 1 (1971); Hanft, Some Aspects of Evidence in Adjudication by Administrative Agencies in North Carolina, 49 N.C.L.Rev. 635, 668-74 (1971); Hanft, Administrative Law, 45 N.C.L.Rev. 816, 816-19 (1967). The "whole record" test does not allow the reviewing court to replace the Board's judgment as between two reasonably conflicting views, even though the court could justifiably have reached a different result had the matter been before it de novo. Universal Camera Corp., supra. On the other hand, the "whole record" rule requires the court, in determining the substantiality of evidence supporting the Board's decision, to take into account whatever in the record fairly detracts from the weight of the Board's evidence. Under the whole evidence rule, the court may not consider the evidence which in and of itself justifies the Board's result, without taking into account contradictory evidence or evidence from which conflicting inferences could be drawn. Universal Camera Corp., supra.

292 N.C. at 410, 233 S.E.2d at 541.

In the present case it does not appear from a view of the "whole record" that the decision of the State Board was supported by "competent, material, and substantial evidence". In this instance the State Board, rather than Superior Court, is the fact finding body. Therefore, we examine the record to determine whether the evidence presented to the State Board was sufficient to support its conclusions.

It is a principle of law in this State that ad valorem tax assessments are presumed to be correct. See, In re Appeal of Amp, Inc., 287 N.C. 547, 215 S.E.2d 752 (1975); Electric Membership Corp. v. Alexander, 282 N.C. 402, 192 S.E.2d 811 (1972); 72 Am.Jur.2d State and Local Taxation § 713 (1974). This presumption places the burden of proof that they are incorrect with the taxpayer, here the petitioner.

Justice Copeland's opinion in In re Appeal of Amp, Inc., supra, sets out the two-pronged test the court must apply when making its determination with respect to whether the taxpayer has overcome that presumption. He states that:

(I)n order for the taxpayer to rebut the presumption he must produce "competent, material and substantial" evidence that tends to show that: (1) Either the county tax supervisor used an arbitrary method of valuation; or (2) the county tax supervisor used an illegal method of valuation; AND (3) the assessment substantially exceeded the true value in money of the property. See Albemarle Electric Membership Corp. v. Alexander, supra, 282 N.C. 410, 192 S.E.2d at 816-17. Simply stated, it is not enough for the taxpayer to show that the means adopted by the tax supervisor were wrong, he must also show that the result arrived at is substantially greater than the true value in money of the property assessed, i. e., that the valuation was unreasonably high. Id....

In re Appeal of Amp, Inc., 287 N.C. 547, 563, 215 S.E.2d 752, 762 (1975).

In our opinion petitioner's evidence was sufficient to meet the requirements of this test and rebut the presumption of correctness.

The record clearly indicates that the Avery County tax supervisor employed an "arbitrary" method of valuation. Guidelines for the proper appraisal of real and personal property are set out in the General Statutes.

G.S. 105-317 provides in part:

Appraisal of real property; adoption of schedules, standards, and rules.-(a) Whenever any real property is appraised it shall be the duty of persons making appraisals:

(1) In determining the true value of land, to consider as to each tract, parcel, or lot separately listed at least its advantages and disadvantages as to location; zoning; quality of soil; waterpower; water privileges; mineral, quarry, or other valuable deposits; fertility; adaptability for agricultural, timber-producing, commercial, industrial, or other uses; past income; probable future income; and any other factors that may affect its value except growing crops of a seasonal or annual nature.

(b) In preparation for each revaluation of real property required by G.S. 105-286, it shall be the duty of the tax supervisor to see that:

(1) There be developed and compiled uniform schedules of values, standards, and rules to be used in appraising real property in the county. (The schedules of values, standards, and rules shall be prepared in sufficient detail to enable those making appraisals to adhere to them in appraising the kinds of real property commonly found in the county; they shall be:

a. Prepared prior to each revaluation required by G.S. 105-286;

b. In written or printed form; and

c. Available for public inspection upon request.)

(2) Every lot, parcel, tract, building, structure, and improvement being appraised be actually visited, observed, and appraised by a competent appraiser, either...