Black v. Board of Revision of Cuyahoga County

• Decision Date: 27 March 1985
• Docket Number: No. 84-236,84-236
• Citation: 16 Ohio St.3d 11,475 N.E.2d 1264,16 OBR 363
• Parties: , 16 O.B.R. 363 BLACK et al., Trustees, Appellees and Cross-Appellants, v. BOARD OF REVISION OF CUYAHOGA COUNTY et al.; Cleveland Board of Education, Appellant and Cross-Appellee.
• Court: Ohio Supreme Court

Page 11

16 Ohio St.3d 11

475 N.E.2d 1264, 16 O.B.R. 363

BLACK et al., Trustees, Appellees and Cross-Appellants, v. BOARD OF REVISION OF CUYAHOGA COUNTY et al.; Cleveland Board of Education, Appellant and Cross-Appellee.

No. 84-236.

Supreme Court of Ohio.

March 27, 1985.

Syllabus by the Court

1. R.C. 5717.05 does not require a trial de novo by courts of common pleas on appeals from decisions of county boards of revision. The court may hear the appeal on the record and evidence thus submitted, or, in its discretion, may consider additional evidence. The court shall independently determine the taxable value of the property whose valuation or assessment for taxation is complained of, or, in the event of discriminatory valuation, shall determine a valuation that corrects such discrimination. The judgment of the trial court shall not be disturbed absent a showing of abuse of discretion.

2. Real property, whether commercial, residential, or vacant, must be assessed on the basis of the same uniform percentage of actual value.

The subject of this appeal is the value of the Union Commerce Building for real estate tax purposes in the tax years 1977 and 1978.

In January 1978, appellant and cross-appellee, the Cleveland Board of Education (hereinafter "board of education") through its attorneys filed a complaint against the owners of the Union Commerce Building, Robert F. Black et al., Trustees of First Union Realty, with the Cuyahoga County Board of Revision (hereinafter "board of revision"). In its complaint, the board of education sought an increase in the assessed value of the property from $9,247,390 to $12,586,700. The $3,339,310 increase was derived from a reassessment of the fair market value of the building from $26,444,828 to $35,962,000.

A full evidentiary hearing was held before the board of revision and a voluminous record was compiled. Based on this record, which consisted of expert testimony and a substantial compilation of other evidence, the board ruled that the assessed valuation for the Union Commerce Building be increased by $5,452,610 to $14,700,000. This latter figure constituted thirty-five percent of $42,000,000, the fair market value of the property as determined by the board.

Robert F. Black et al., as taxpayer, and the Union Commerce Bank, as lessee of the building (hereinafter collectively "UCB"), appealed the board's decision to the court of common pleas pursuant to R.C. 5717.05. Specifically, UCB took exception to the fair market valuation as noted above. The court gave the parties numerous opportunities to supplement the record with additional evidence, but did not permit a trial de novo.

The matter proceeded to oral argument. The trial court heard the appeal upon the record filed with the court by the board of revision, stipulations of the parties, resolutions by the board of education authorizing its law firm to initiate the reassessment complaints on its behalf, and the briefs and oral arguments of counsel.

Based upon its independent assessment of the evidence, the court essentially upheld the board of revision's valuation of the contested property. The court found the fair market value of the building to be $41,500,000 for 1977 and $42,000,000 for 1978. The court further concluded that the assessed value would be thirty-five percent of the true value of the property. This judgment was later modified to reflect a correction in the calculation of maintenance expenses, thereby fixing the 1977 and 1978 fair market values at $41,000,000 and $41,500,000 respectively.

UCB appealed the decision to the Court of Appeals for Cuyahoga County. On appeal, UCB argued, inter alia, that the refusal of the common pleas court to conduct a trial de novo contravened R.C. 5717.05, with the resultant effect of depriving UCB of its constitutional rights. UCB further contended that the common pleas court violated Ohio law in its valuation of the property. Finally, UCB alleged that the common pleas court applied a discriminatory and, therefore, unconstitutional level of assessment. The court of appeals agreed and, accordingly, reversed and remanded the cause for a full evidentiary hearing consistent with its findings.

The cause is now before this court pursuant to the allowance of a motion and cross-motion to certify the record.

Arter & Hadden, Curtiss L. Isler and Jacob I. Rosenbaum, Cleveland, for appellees and cross-appellants.

Armstrong, Gordon & Mitchell, Timothy J. Armstrong and William Mitchell, Cleveland, for appellant and cross-appellee.

WRIGHT, Justice.

The issues presented by this appeal are whether the common pleas court abused its discretion in refusing to conduct a trial de novo or erred in its valuation of UCB's property and whether a discriminatory level of assessment was applied. We hold that the court of common pleas did not abuse its discretion in disallowing a trial de novo. We further hold that the court's method of valuation and application of a uniform rate of assessment were proper.

R.C. 5717.05 defines the parameters of an appeal from the board of revision to the court of common pleas, and states, in pertinent part, that:

" * * * [A]n appeal from the decision of a county board of revision may be taken directly to the court of common pleas * * *.

" * * *

"Within thirty days after notice of appeal to the court has been filed with the county board of revision said board shall certify to the court a transcript of the record of the proceedings of said board pertaining to the original complaint and all evidence offered in connection therewith.

"The court may hear the appeal on the record and the evidence thus submitted, or it may hear and consider evidence in addition thereto. It shall determine the taxable value of the property whose valuation or assessment for taxation by the county board of revision is complained of, or in the event the complaint and appeal is against a discriminatory valuation, shall determine a valuation which shall correct such discrimination, and the court shall determine the liability of the property for assessment for taxation, if that question is in issue, and shall certify its judgment to the auditor, who shall correct the tax list and duplicate as required by such judgment." (Emphasis added.)

UCB argues that although the terms of the statute expressly state that the common pleas court may hear and consider evidence in addition to the record on appeal, the statute nevertheless is mandatory and requires a full evidentiary hearing or trial de novo. UCB cites two cases, Cleveland v. Bd. of Revision (1953), 96 Ohio App. 483, 115 N.E.2d 690 , and Zeisloft v. Bd. of Revision (1972), 32 Ohio St.2d 180, 291 N.E.2d 472 , in support of this proposition.

Our reading of these cases differs from that presently urged by UCB and will clarify any confusion arising from those cases which construe R.C. 5717.05. The requirements of R.C. 5717.05, as interpreted by Cleveland, supra, establish that the common pleas court has a duty on appeal to independently weigh and evaluate all evidence properly before it. The court is then required to make an independent determination concerning the valuation of the property at issue. The court's review of the evidence should be thorough and comprehensive, and should ensure that its final determination is more than a mere rubber stamping of the board of revision's determination. The Cleveland case does not, however, require a trial de novo.

UCB quotes Zeisloft, supra, for the proposition that R.C. 5717.05 "contemplates more than an appeal. * * * The statute contemplates a trial of the issues of valuation leading to a judgment by the court, * * *." (Emphasis sic.) Zeisloft at 183, 291 N.E.2d 472. This statement is accurate as R.C. 5717.05 requires more than a mere appeal because the court must consider anew all of the evidence and may, in its discretion, admit additional evidence. Based on its evaluation of this evidence, the court must make an independent judgment regarding the taxable value of the property. However, Zeisloft does not mandate a full-blown trial de novo.

UCB further contends that this court has carved out an exception to the normal statutory interpretation of the word "may" which requires that "may" be read as "must" in all cases of great public interest, or in cases where a matter of public policy and not merely a private right is involved. According to UCB, R.C. 5717.05 must be given such an interpretation, mandating a trial de novo. UCB cites two cases in support of this contention, Stanton v. Frankel Bros. Realty Co. (1927), 117 Ohio St. 345, 158 N.E. 868 and Pennsylvania R.R. Co. v. Porterfield (1971), 25 Ohio St.2d 223, 267 N.E.2d 792 . Stanton was concerned with an interpretation of G.C. 5611-2, regarding review of the Tax Commissioner's evaluations, which limited the trial court's review of that agency's ruling to a clear and convincing standard. Pennsylvania concerned the valuation of a railroad which had "taxable property in 56 of the 88 counties of this state." We need not distinguish these cases further, however, except to say that the valuation of a privately owned office building does not fall within the purview of the term "great public interest" or is a "matter of public policy."

While R.C. 5717.05 requires more than a mere review of the decisions of the board of revision, that review may be properly limited to a comprehensive consideration of existing evidence and, in the court's discretion, to an examination of additional evidence. The court should consider all such evidence and determine the taxable value through its independent judgment. In effect, R.C. 5717.05 contemplates a decision de novo. It does not, however, provide for an original action or trial de novo. Selig v. Bd. of Revision (1967), 12 Ohio App.2d 157, 165, 231 N.E.2d 479 .

The independent judgment of the trial court should not be disturbed absent a showing of abuse of discretion. Specifically, an appeals court...