Conn. Sav. Bank Of New Haven v. City Of New Haven. Same
| Decision Date | 21 February 1945 |
| Citation | 41 A.2d 765,131 Conn. 575 |
| Court | Connecticut Supreme Court |
| Parties | CONNECTICUT SAV. BANK OF NEW HAVEN v. CITY OF NEW HAVEN. SAME v. BOARD OF TAX REVIEW OF CITY OF NEW HAVEN. |
OPINION TEXT STARTS HERE
Appeal from Superior Court, New Haven County; McEvoy, Judge.
Appeal from Court of Common Pleas, New Haven County; Parmelee, Judge.
Proceedings by the Connecticut Savings Bank of New Haven against City of New Haven, and by same plaintiff against the Board of Tax Review of the City of New Haven, to review action of the Board of Tax Review of the defendant city in refusing to reduce the assessors' valuation of real estate owned by the plaintiff, one, involving the 1940 list, taken to the Superior Court, and the other, involving the 1941 list, to the Court of Common Pleas in New Haven County, and referred by the court in each case to Hon. John W. Banks, State Referee. Judgment on the report in each case reducing the assessment on some parcels of land and refusing to reduce it on others, and both parties appeal.
No error on either appeal.
Morris Tyler and Crenna Sellers, both of New Haven, for appellant-appellee (plaintiff).
David S. Rivkin, of New Haven (A. Frederick Mignone, of New Haven, on the brief), for appellant-appellee (defendant).
Before MALTBIE, C. J., and BROWN, JENNINGS, ELLS, and DICKENSON, JJ.
The preliminary statement above sufficiently describes the general situation. Both cases were tried together before a state referee. Both appeals are based on the overruling of remonstrances to the reports. The plaintiff claims that all of the valuations placed on the properties are too high. The defendant claims that no reductions should have been granted. Ninety-seven different assessments are involved, but neither side has requested detailed analysis of each individual assessment except in so far as is necessary to test the validity of the conclusions reached by the referee, with which the trial court refused to interfere. Both sides co-operated in the presentation of the evidence and the analysis of the exhibits in the briefs of the plaintiff is skillful and thorough and has been most helpful in the study of this complicated record.
The reports in both appeals were substantially identical. They are divided into two parts. Part A may be summarized as follows: The subject properties consisted of various types but were of a a kind to interest only those who bought real estate as an investment, to derive either income therefrom or a profit on resale, or both. The plaintiff had held mortgages on all of these properties and had acquired title thereto either by foreclosure or quitclaim deeds from the owners of the equity. Nearly all of them had been sold at the time of trial. Most of the sales were in 1941. The plaintiff was not forced to sell them but it was the holder of a very large number of properties acquired by foreclosure of its mortgages and was in a sense an ‘unwilling holder.’ It proceeded to liquidate its holdings for the best prices it could obtain. The prices realized did not conclusively determine the fair market value of these properties for assessment purposes.
The experts of the plaintiff based their appraisals, made before sale, upon sales of similar and comparable properties during the years 1936 through 1941. They also applied to the subject properties methods of appraisal which utilized reproduction cost of the buildings less depreciation and obsolescence and capitalization of net and gross income.
The defendant's experts testified that during this period there was no ‘normal’ market from which the fair market value of real property could be determined; they did not base their appraisals on sales of similar and comparable properties but, as regards buildings, upon capitalization of gross and net income and reproduction cost less depreciation and obsolescence; and they added to the values so determined the values of the land. Five per cent was a fair, reasonable and accepted percentage to be used as a factor in capitalizing net income.
There was a market for real property in New Haven between 1936 and 1941. Besides the subject properties, between two hundred and fifty and three hundred other properties comparable thereto were sold during that period, a majority of them by banks and insurance companies. Following the general business depression in 1930, there was a very substantial decrease in the number of transfers, and the prices realized were not comparable with those obtained prior to that date. As compared with the years prior to 1930, the market in 1940 was not a ‘normal’ market. The market between 1936 and 1941 was not such a market that sales then made could be relied on exclusively as determining the true and actual value of property over a period of years, which is deemed to be the fair market value of property for assessment purposes.
Since 1930, the assessors have reduced the assessments on nearly all of these properties, in many cases very substantially. After the bringing of the appeal from the assessment of 1940, the assessors examined the subject properties and other properties in the same area and reduced the assessment upon certain of the plaintiff's properties and certain other properties in the same area, to equalize the assessments upon the list of 1941. After the closing sessions of the board of tax review in each of the years 1940 and 1941, the board visited each of the subject properties and reviewed it in connection with the values placed upon other comparable properties. It reduced the values on twenty-nine of the properties on the list of 1940 in the gross amount of $37,875 and on seven on the list of 1941 in the gross amount of $23,165. The total assessed value of the plaintiff's property involved in these appeals was $2,210,690 and the total value as fixed by the referee was $1,954,100, a further reduction by him of $256,590. The figures are from the plaintiff's brief.
Part B of the report consisted of an analysis of each property. The following quotation is a fair sample. The last sentence appeared in each case, only the amounts varying.
‘The true and actual value and fair market value of the land was $4000 and of the building $6000, a total of $10,000.’
The plaintiff remonstrated against the acceptance of the report. The remonstrance requests the elimination of one fact found without evidence, asks that the report be recommitted or, in the alternative, that certain facts be added and claims that in any event the report should not be accepted for reasons apparent on its face. One ruling on evidence was also included in the remonstrance but this was not pursued in the brief. The motion to recommit was denied, the remonstrance was overruled and judgment was entered on the report. The assignments of error, in substance, make these rulings the subject of the appeal. Its consideration is simplified by the preliminary statement of the questions presented in the plaintiff's brief:
‘(1) In an appeal from the doings of a Board of Relief claiming excessive assessment where a market for the property in question is found to exist, is it error for the trier of fact to consider evidence of value computed by those methods approved for use only in cases where concededly there is no market?
‘(2) Was it error in any case for the trier to find values almost uniformly so far in excess of the evidence of market value as to show that he gave little or no weight to such evidence?’
The rules for the determination of the amount for which property should be assessed have a very considerable legislative history. The present method of basing taxation upon the valuation of property by assessors orginated in Chapter 2 of the Public Acts passed at the May session, 1819. According to the statute in force in 1821, dwelling houses were to be set in the list ‘valued at the rate which each separate dwelling-house and lot * * * are worth in money, and with due regard to the situation, use and income thereof.’ Statutes, 1821, p. 446, § 2. Market value first appears in Chapter 47 of the Public Acts of 1851. Section 7 provides that dwelling houses ‘shall be valued and assessed according to the present true and just value thereof.’ Section 8 defines this as follows: ‘The present true and just value of any estate, either real or personal, liable to be assessed by virtue of the provisions of this Act, shall be deemed and taken by the assessors and board of relief of the several towns, to be the fair, market value thereof, being the price which could be obtained therefor at private sale, and not its value at a forced or auction sale.’ General Statutes, Rev. 1875, tit. 12, c. 1, p. 155, § 13, provides that dwelling houses are ‘to be set in the list at their present true and actual valuation.’ This was defined by § 17 (p. 156) as follows: ‘The present true and just value of any estate shall be deemed by all assessors and boards of relief to be the fair, market value thereof, and not its value at a forced or auction sale.’ The present law, General Statutes, §§ 1143, 1149, makes no change in the first sentence, but the second is made to conform thereto and the comma after ‘fair’ is omitted, so that it reads, ‘The present true and actual value of any estate shall be deemed by all assessors and boards of relief to be the fair market value thereof, and not its value at a forced or auction sale.’ If these omissions and changes have any significance, they tend to...
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