Berthiaume v. City of Nashua

• Decision Date: 27 September 1978
• Docket Number: No. 78-067,78-067
• Citation: 118 N.H. 646,392 A.2d 143
• Parties: Adelard BERTHIAUME et al. v. CITY OF NASHUA.
• Court: New Hampshire Supreme Court

Page 143

392 A.2d 143

118 N.H. 646

Adelard BERTHIAUME et al. v.CITY OF NASHUA.

No. 78-067.

Supreme Court of New Hampshire.

Sept. 27, 1978.

Hamblett & Kerrigan, P.A., Nashua (Joseph M. Kerrigan, Nashua, orally, for plaintiffs.

H. Philip Howorth, Nashua (Morgan A. Hollis, Nashua, orally), for defendant.

GRIMES, Justice.

This tax abatement case presents a similar question to that recently decided by this court in Poorvu v. City of Nashua, 118 N.H. ---, 392 A.2d 138(September 27, 1978).The narrow issue to be decided is whether the trial court committed reversible error by ruling that the plaintiffs had failed to introduce evidence as to the value of other properties in the city of Nashua.Based upon our reading of the transcript, we find that it did.

The plaintiffs own Rich's Shopping Center which consists of 718,740 square feet of land.From 1970 through 1973 the buildings on this land had 78,050 square feet of leaseable area, but in 1973 the area was increased to 90,050.The total assessed value for the years 1970, 1971, and 1972 was $1,237,740.In 1973, the year during which an addition was commenced, the assessment was $1,329,840.In 1974 the assessment was $1,443,940.

Plaintiffs seek an abatement of taxes on the shopping center property for the years 1970 through 1974.The Nashua Board of Assessors denied this request, and plaintiffs appealed this decision to the superior court.RSA 76:17 (Supp.1977).A trial resulted in a verdict for the defendant on all petitions.The Court(Bois, J.) reserved and transferred plaintiffs' exceptions to the courts' findings and rulings of law.

Plaintiffs' expert witness testified that the fair market value of the plaintiffs' property was $772,000 in tax years 1970-73.He also testified that the fair market value was $907,000 in 1974.His testimony of value was based upon the capitalization of net income approach.It is well established that no single method of evaluation is controlling, but this method is an established and well-accepted method for determining the value of income-producing property.Demoulas v. Town of Salem, 116 N.H. 775, 780, 367 A.2d 588, 592(1976);Paras v. City of Portsmouth, 115 N.H. 63, 67-68, 335 A.2d 304, 307-08(1975).Indeed, the supervisor for the city's revaluation testified that for income-producing property such as plaintiffs', the capitalization approach is preferred over the reproduction cost less depreciation method.

Plaintiffs have the burden of showing that the assessment placed on the subject property was disproportionately higher in relation to its true value than was the case as to the other property in the city.Duval v. Manchester, 111 N.H. 375, 286 A.2d 612(1971);Freedman v. Exeter, 107 N.H. 163, 219 A.2d 275(1966).Plaintiffs attempted to show this disproportionality by computing the ratio of assessed value of the subject property to its true value and then comparing those ratios to other property in the city.SeeHodges v. Kensington, 102 N.H. 399, 157 A.2d 649(1960).According to the testimony of plaintiffs' expert as to the true value of the subject property, the ratio of assessed value to market value ranged from 158 percent to 172 percent for the years in question.

Plaintiffs attempted to show the true value of the other property in various ways.The first was through the testimony of the director of the appraisal division of the State Department of Revenue Administration.The director testified that every other year his office compiles the assessed value-market value ratio for each community.The market values the State uses are the sales prices as taken from the registry of deeds as verified by the parties and the assessment figures as supplied by the local assessors.From April 1, 1970 to April 1, 1971, the average ratio between the assessed value and the fair market value was 94 percent; from April 1, 1972 to April 1, 1973, the ration was 79 percent; and from April 1, 1974 to April 1, 1975, the ratio was 64 percent.

Defendant contends that plaintiffs were obliged to show that the market in which the sales occurred was fair, and not depressed, and that...