Bystrom v. Equitable Life Assur. Soc. of U.S., Nos. 80-26

CourtCourt of Appeal of Florida (US)
Writing for the CourtBefore HUBBART; NESBITT; DANIEL S. PEARSON, Judge, joined by HUBBART
Citation416 So.2d 1133
PartiesF. B. BYSTROM, Property Appraiser of Dade County, Florida, and Randy Miller, as Executive Director of the Department of Revenue, Appellants, v. EQUITABLE LIFE ASSURANCE SOCIETY OF the UNITED STATES, a New York corporation, Omni International of Miami, Ltd., a Georgia Limited Partnership, and Omni International of Miami, Inc., Appellees.
Decision Date31 March 1982
Docket NumberNos. 80-26,80-66

Page 1133

416 So.2d 1133
F. B. BYSTROM, Property Appraiser of Dade County, Florida, and Randy Miller, as Executive Director of the Department of Revenue, Appellants,
v.
EQUITABLE LIFE ASSURANCE SOCIETY OF the UNITED STATES, a New York corporation, Omni International of Miami, Ltd., a Georgia Limited Partnership, and Omni International of Miami, Inc., Appellees.
Nos. 80-26, 80-66.
District Court of Appeal of Florida,
Third District.
March 31, 1982.
Rehearing Denied July 20, 1982.

Page 1136

Jim Smith, Atty. Gen. and E. Wilson Crump, III, Asst. Atty. Gen., Robert A. Ginsburg, County Atty. and Robert L. Krawcheck, Asst. County Atty., for appellants.

Sibley, Giblin, Levenson & Glaser and Marion E. Sibley, Miami, for appellees.

Steven A. Schultz, Miami, for The Dade County Property Appraisal Adjustment Board as amicus curiae.

Before HUBBART, C. J., and NESBITT and DANIEL S. PEARSON, JJ.

NESBITT, Judge.

This controversy concerns the assessment of ad valorem property taxes for the year 1978 on Omni International of Miami, which will be referred to as "Omni." Appellant, F. B. Bystrom, as Property Appraiser of Dade County, will be referred to as "Appraiser." Appellant, Randy Miller, Executive Director of the Department of Revenue of the State of Florida, will be referred to as "Department of Revenue." The Dade County Property Appraisal Adjustment Board will be referred to as the "Board." Collectively, the appellants will be referred to as the "Taxing Authority." The appellees, who either own or have an interest in the affected real property, will be referred to as "Taxpayers."

The Background

The object of this controversy is the Omni International of Miami, which is succinctly described as a "multi-purpose megastructure." This shopping center-hotel complex opened in June of 1977, for which year it was partially assessed and paid ad valorem taxes. The first year it was fully open and subject to taxation for an entire year was in 1978.

Utilizing the "cost approach," the Appraiser's predecessor placed the preliminary

Page 1137

valuation as of January 1, 1978 at $67,251,535. The Taxpayers filed a petition with the Board contesting the preliminary assessment, asserting a proper valuation of $37,000,000.

A special master's report was adopted by the Board, utilizing an "income approach," and resulting in a re-assessment of the just valuation to $59,560,000. The Appraiser, joined by the Department of Revenue, challenged the Board's reduced valuation by filing suit in the circuit court pursuant to Section 194.032(6)(a), Paragraphs 1 and 2, Florida Statutes (1977). 1 The Taxpayers filed their answer and a counterclaim as expressly authorized by Sections 194.032(6)(b) and 194.171, Florida Statutes (1977). 2

It is pertinent to observe that while the rival claims are clothed in different raiment due to: (1) the Taxing Authority's contention that the cost approach was the only proper approach in the assessment of the property; and (2) the Taxpayers' contention that the proper method by which to ultimately assess the property was by utilizing the income approach, the claims were singularly identical with respect to the ultimate issue--the just valuation of the property under Article VII, Section 4 of the Florida Constitution and Section 193.011, Florida Statutes (1977). 3 In a non-jury trial, the

Page 1138

claims were tried seriatim without either party requesting a motion for involuntary dismissal at the close of the other party's presentation, as they might have, pursuant to Florida Rule of Civil Procedure 1.420(b). After consideration of memoranda in lieu of closing argument, the trial court entered final judgment upon the Taxpayers' counterclaim finding the just valuation of the property as of January 1, 1978 to be $43,000,000. The circuit court expressly adopted the income or economic approach and expressly rejected the Board's re-evaluation as well as the underlying appraiser's cost approach to the assessment of the real property.

Ordinarily, where a complaint and a counterclaim are tried together, each case is disposed of with respect to the testimony and evidence produced in that case. However, in the present case, the identity of issues and the submission of the case on post trial memoranda created a situation whereby each party relied upon the totality of the evidence. In entering the final judgment on behalf of the Taxpayers on their counterclaim, the trial judge considered testimony produced by the Appraiser during his case in chief that:

The Property Appraiser's own testimony substantiated that the valuation of this property was fixed by the cost approach.

The parties acquiesced in the court's consideration of the evidence as it was presented in its entirety. Neither party has appealed the propriety of that procedure. Consequently, even though the Taxing Authority only appeals the judgment in favor of the Taxpayers on their counterclaim, we will consider all of the evidence presented in this case.

Exclusion of Income Data Evidence

In its case in chief and defense of the Taxpayers' counterclaim, the Taxing Authority offered into evidence the actual operating data from Omni for the fiscal year commencing January 1 and ending December 31, 1978, which data the trial court excluded principally on the ground that it was incompetent. We disagree and reverse the judgment on this basis.

It is true and undisputed that the polestar of determining just valuation lies in ascertaining the valuation as of January 1 of the taxable year. Lake Worth Towers, Inc. v. Gerstung, 262 So.2d 1 (Fla.1972); Walter v. Schuler, 176 So.2d 81 (Fla.1965). However, in determining the fair market value of the property on January 1, evidence which comes to light after that date may be relevant to the valuation as of January 1 as well as rebuttal to the Taxpayers' appraiser's valuation.

In Homer v. Connecticut General Life Insurance Company, 213 So.2d 490, 492 (Fla. 3d DCA 1968), we stated, "The assessment may be defended by the presentation of any legally competent and relevant evidence proving or tending to prove the fair market value of the property." The necessary correlative of this proposition is that the presentation of any legally competent or relevant evidence is probative of just valuation.

As substantive evidence, the actual income of the property is clearly relevant in reaching a valuation that conforms to the willing buyer-willing seller concept. See Walter v. Schuler, supra. Because Omni was a unique structure and had only been

Page 1139

in operation for five months, there was no trend from which the appraiser could estimate income. 4 Since it is not unusual for the appraiser to begin his assessment after January 1, there is no reason why he should be precluded from utilizing actual data insofar as it reflects upon conditions on January 1.

The Taxpayers' appraiser admitted that he used data which came to light after January 1 in reaching his determination as to the proper assessment. He stated that he did not start the appraisal until six months after the valuation date. He continued:

What I did was to take the list of the people who they had as being firm prospects and so on, and I went through Omni with a list in my hand to see if the tenants were, in fact in possession and some of them were. Some never came in.

The Taxpayers can hardly be heard to object to the use of such data by the Property Appraiser.

Furthermore, Section 195.027(3), Florida Statutes (1977), authorizes the appraiser to obtain access to a taxpayer's records which would aid the appraiser in rendering his assessment. Florida Administrative Code Rule 12D-1.05(1)(c)(3), promulgated pursuant to the statute specifically provides for access to records of leases, both before and after the January 1 date. This rule then assumes the relevancy of data after the January 1 date in reaching a proper valuation. 5

The relevance of actual income data as rebuttal becomes apparent when the testimony of the Property Appraiser's predecessor in office, A. H. Blake, and the Taxpayers' appraiser, are examined together. In the Taxing Authority's case in chief, Mr. Blake stated that, in utilizing the income approach to arrive at just valuation, it becomes necessary to forecast the income of the property. He testified that the actual income would be the best way to measure the accuracy of that forecast. The trial judge excluded this actual income. The Taxpayers' appraiser similarly testified that he would utilize projections of the income of the property in arriving at his appraisal. For example, he stated that he considered the collapse of the operation which Omni had in Atlanta and from that estimated that tenants would only be able to afford 50% of the rent for which they were obligated to pay. He therefore adjusted the income accordingly.

On rebuttal, the Taxing Authority sought once again to introduce the actual operating income to rebut the Taxpayers' projection. It was proffered that the actual data would prove that the Taxpayers' appraiser did not hypothecate a knowledgeable buyer and seller because his projection was grossly at variance with actual conditions. We agree with the Taxing Authority that this rebuttal testimony was highly relevant.

In reaching this conclusion, we recognize that in some cases annual operating revenue or losses become so remote in relation to just valuation that the trial court need not accord such testimony much weight--however, that determination must be made by the trier of fact in each case.

Having determined that the income data is relevant as both substantive and rebuttal evidence, it is admissible unless

Page 1140

otherwise prohibited by law. Section 90.402, Florida Statutes (1977). We do not find that the January 1 date for fixing the valuation of property is a prohibition against the admission of evidence which comes to light after that date. Similarly, we do not find that the July 1 deadline for completion of...

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32 practice notes
  • Bystrom v. Union Land Investments, Inc., No. 84-1604
    • United States
    • Court of Appeal of Florida (US)
    • August 6, 1985
    ...417 So.2d 1002 (Fla. 3d DCA), rev. denied, 424 So.2d 762 (Fla.1982); Bystrom v. Equitable Life Assurance Society of the United States, 416 So.2d 1133 (Fla. 3d DCA 1982), rev. denied, 429 So.2d 5 (Fla.1983); Muss v. Blake, 416 So.2d 2 (Fla. 3d DCA), rev. denied, 424 So.2d 762 (Fla.1982), and......
  • Schultz v. TM Florida-Ohio Realty Ltd., Partnership, FLORIDA-OHIO
    • United States
    • Court of Appeal of Florida (US)
    • July 21, 1989
    ...Hotelerama Associates, Ltd., 431 So.2d 176 (Fla. 3d DCA), rev. denied, 441 So.2d 631 (1983); Bystrom v. Equitable Life Assurance Society, 416 So.2d 1133, 1138 (Fla. 3d DCA 1982), rev. denied, 429 So.2d 5 (1983) ("As substantive evidence, the actual income of the [shopping center-hotel compl......
  • Folsom v. Spokane County, No. 50579-9
    • United States
    • United States State Supreme Court of Washington
    • October 2, 1986
    ...ex rel. Park Plaza Shopping Ctr., Inc. v. Board of Review, 61 Wis.2d 469, 213 N.W.2d 27 (1973); Bystrom v. Equitable Life Assur. Soc'y, 416 So.2d 1133 (Fla.Dist.Ct.App.1982); Brickman v. Manchester, 119 N.H. 919, 409 A.2d 1328 (1979). At least two courts have found that the assessor erred i......
  • Fuchs v. Robbins, No. 98-275
    • United States
    • Florida District Court of Appeals
    • November 18, 1998
    ...set out in section 193.011, Florida Statutes (1991), in making his assessment. See Bystrom v. Equitable Life Assurance Soc'y of U.S., 416 So.2d 1133 (Fla. 3d DCA 1982). The burden then shifted to the taxpayer to "overcome the property appraiser's assessment by excluding every reasonable hyp......
  • Request a trial to view additional results
32 cases
  • Bystrom v. Union Land Investments, Inc., No. 84-1604
    • United States
    • Court of Appeal of Florida (US)
    • August 6, 1985
    ...417 So.2d 1002 (Fla. 3d DCA), rev. denied, 424 So.2d 762 (Fla.1982); Bystrom v. Equitable Life Assurance Society of the United States, 416 So.2d 1133 (Fla. 3d DCA 1982), rev. denied, 429 So.2d 5 (Fla.1983); Muss v. Blake, 416 So.2d 2 (Fla. 3d DCA), rev. denied, 424 So.2d 762 (Fla.1982), and......
  • Schultz v. TM Florida-Ohio Realty Ltd., Partnership, FLORIDA-OHIO
    • United States
    • Court of Appeal of Florida (US)
    • July 21, 1989
    ...Hotelerama Associates, Ltd., 431 So.2d 176 (Fla. 3d DCA), rev. denied, 441 So.2d 631 (1983); Bystrom v. Equitable Life Assurance Society, 416 So.2d 1133, 1138 (Fla. 3d DCA 1982), rev. denied, 429 So.2d 5 (1983) ("As substantive evidence, the actual income of the [shopping center-hotel compl......
  • Folsom v. Spokane County, No. 50579-9
    • United States
    • United States State Supreme Court of Washington
    • October 2, 1986
    ...ex rel. Park Plaza Shopping Ctr., Inc. v. Board of Review, 61 Wis.2d 469, 213 N.W.2d 27 (1973); Bystrom v. Equitable Life Assur. Soc'y, 416 So.2d 1133 (Fla.Dist.Ct.App.1982); Brickman v. Manchester, 119 N.H. 919, 409 A.2d 1328 (1979). At least two courts have found that the assessor erred i......
  • Fuchs v. Robbins, No. 98-275
    • United States
    • Florida District Court of Appeals
    • November 18, 1998
    ...set out in section 193.011, Florida Statutes (1991), in making his assessment. See Bystrom v. Equitable Life Assurance Soc'y of U.S., 416 So.2d 1133 (Fla. 3d DCA 1982). The burden then shifted to the taxpayer to "overcome the property appraiser's assessment by excluding every reasonable hyp......
  • Request a trial to view additional results

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