Donlon v. Board of Assessors of Holliston

• Decision Date: 08 August 1983
• Citation: 453 N.E.2d 395,389 Mass. 848
• Parties: Edward C. DONLON et al. 1 administrators, v. BOARD OF ASSESSORS OF HOLLISTON.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

Page 395

453 N.E.2d 395

389 Mass. 848

Edward C. DONLON et al. ¹ administrators, v. BOARD OF ASSESSORS OF HOLLISTON.

Supreme Judicial Court of Massachusetts Suffolk.

Argued March 10, 1983.

Decided Aug. 8, 1983.

Edward C. Donlon, Wellesley, for plaintiffs.

William H. Clancy, Boston, for defendant.

Before HENNESSEY, C.J., and WILKINS, LIACOS, ABRAMS and O'CONNOR, JJ.

O'CONNOR, Justice.

Edward C. Donlon and Edward R. Lembo (appellants), the special coadministrators of the estate of Angus J. McPherson, appeal pursuant to G.L. c. 58A, § 13, from two decisions of the Appellate Tax Board (board), one rejecting claims of overvaluation of real estate for fiscal 1979, and one dismissing a similar claim for fiscal 1980. ² The property that was the subject of the board's decisions is located in Holliston and consists of 150 separate parcels represented by 150 tax bills. On January 1, 1978, and January 1, 1979, the estate of Angus J. McPherson was the assessed owner of sixty-two of the 150 parcels. The assessed owners of the other eighty-eight parcels were as follows: Holliston Realty Co., Inc. (Holliston Realty), seventy-one parcels; Pinecrest Country Club, Inc. (Pinecrest), seven parcels; and various straws of McPherson, ten parcels. McPherson, who died in February, 1977, owned all of the stock of Holliston Realty, and owned fifty percent of the stock of Pinecrest. Donlon and Lembo were appointed special coadministrators of McPherson's estate in the summer of 1977. Presumably, the coadministrators have prosecuted the applications for abatement of taxes assessed to the parcels owned by Holliston Realty, Pinecrest, and McPherson's straws, pursuant to the sentence in G.L. c. 59, § 59, which provides: "If a person other than the person to whom a tax on real estate is assessed ... has an interest therein ... and pays the tax, he may thereafter prosecute in his own name any application, appeal or action provided by law for the abatement or recovery of such tax ...."

The board of assessors of Holliston (assessors) assessed the 150 parcels at an aggregate amount of $637,800 for fiscal 1979 and at an aggregate amount of $528,700 for fiscal 1980. The appellants applied for abatements of taxes assessed on the 150 parcels for the two fiscal years, alleging that the parcels were either overvalued or disproportionately assessed. The assessors denied the applications, and the appellants appealed to the board under the formal procedure. After a hearing, the board concluded that it lacked jurisdiction to hear the fiscal 1980 appeals, and decided against the appellants on the merits of the fiscal 1979 appeals. Pursuant to a request by the appellants, the board thereafter issued its findings of fact and report. See G.L. c. 58A, § 13.

The findings of the board which are relevant to whether it had jurisdiction to hear the appellants' claims of overvaluation for fiscal 1980 will be detailed later in this opinion in conjunction with a discussion of the board's ruling on that issue. The findings of the board which are relevant to the appellants' claims of overvaluation for fiscal 1979 are as follows. ³ The real estate owned by Pinecrest is improved by a golf course and a clubhouse with a parking area. The real estate of the other owners of the Holliston property consists primarily of lots in subdivisions known as Pinecrest Homes I and Pinecrest Homes II, and scattered lots on streets near the golf course. The lots in the subdivisions are laid out in a checkerboard pattern so that adjoining lots have different owners. Most of the lots measure approximately 18,000 square feet and have frontages of 100 feet. These dimensions satisfied the frontage and area requirements of the Holliston zoning by-law when the subdivisions were laid out in the early 1960's. The zoning by-law in effect on January 1, 1978, required each residential lot within the district of the subject property to have an area of at least 40,000 square feet and a frontage of at least 180 feet. ⁴

The board found that, when Donlon and Lembo were appointed coadministrators of McPherson's estate in 1977, there were insufficient liquid assets to pay real estate taxes and make mortgage payments on the 150 parcels. To ward off any foreclosure by the bank holding the mortgage on the 150 parcels, the coadministrators arranged to have Haynes Management, Inc. (Haynes), take an assignment of the note and mortgage from the bank in 1978. Haynes managed the golf course during 1978, and ultimately purchased the 150 parcels at a foreclosure sale held on March 30, 1979.

In addition to making these findings, the board reported the following testimony. An appraiser hired by the coadministrators, a former deputy assessor for the town of Braintree, testified that he had made two appraisals of the 150 parcel tract. The first, in April, 1978, was in the amount of $235,000, and the second, in 1980, was in the amount of $100,000. In the first appraisal he determined that there was no market for golf courses in the area, and that the highest and best use of the property was for development as house lots. He determined that none of the lots in the subdivisions known as Pinecrest Homes I and Pinecrest Homes II, and only sixteen of the lots on existing streets near the golf course, could be developed under the zoning by-law then in existence, which required a minimum area of 40,000 square feet and a minimum frontage of 180 feet. The Holliston building inspector disagreed with the appraiser's premise that the frontage and area requirements of the by-law then in existence applied to the subdivision lots. He testified that the subdivision lots were immune from those requirements, and consequently could be developed, because the lots had been laid out before the current by-law became effective. The appellants' appraiser valued each of the sixteen lots he deemed buildable at $10,000, less $6,000 for fill costs, for a net lot value of $4,000. His opinion of value was based on sales of other lots and some percolation tests done in the area. The appraiser considered all remaining land as open land and valued it at $1,000 per acre. He revised his opinion of value in 1980 to $100,000 because of percolation tests that recently had been performed on the property. According to the appraiser, only two of thirteen tests had produced satisfactory results. He opined that the real estate could not be developed unless the town or a private developer installed a sewer system for the property. He did not think this could be done for some time. However, since the golf course produced income, he opined that the entire property had a value of $100,000. There was no evidence of the income and expenses of the golf course.

The engineer for the Holliston board of health testified that he was present when some of the percolation tests were performed and that he had no opinion whether the property would meet ground water requirements for the installation of septic systems. He preferred to reserve his opinion until such time as percolation tests were performed on each lot. Only three applications for building permits had been made in this area since 1974 and they had not been approved, largely because of engineering deficiencies in the percolation tests.

Additional testimony relevant to the appellants' claims of overvaluation for fiscal 1979, but not reported by the board, was offered by appellant Lembo. He testified that all prospective bidders at the foreclosure sale of the 150 parcels on March 30, 1979, were handed a sheet of paper by the Holliston tax collector, which showed that $73,874.74 in taxes were owed on the property. One of the active bidders at the sale held an attachment on the property in connection with a pending suit against McPherson in which he sought to recover $50,000. The other active bidder was Haynes, who took the property with a bid of $163,000.

I. The Appellants' Standing--Fiscal 1979 and 1980.

"Proceedings for abatement are statutory ... [and] must be commenced by an application conforming to statutory requirements or the Appellate Tax Board is without jurisdiction of the proceedings." Boston Five Cents Savs. Bank v. Assessors of Boston, 311 Mass. 415, 416, 41 N.E.2d 283 (1942). General Laws c. 59, § 59, defines those categories of persons who may seek an abatement. One category includes persons "upon whom a tax has been assessed or the administrator of the estate of such person." As coadministrators of the estate of McPherson, Donlon and Lembo were entitled under that provision to apply for an abatement of taxes assessed to McPherson's estate. They were not entitled under that provision, however, to apply for an abatement of taxes assessed to Holliston Realty, Pinecrest, or McPherson's straws. Section 59 also provides that tenants and mortgagees may, in certain circumstances, seek an abatement of taxes assessed on the rented or mortgaged real estate. The coadministrators were neither tenants nor mortgagees. Consequently, their right to seek an abatement of taxes assessed to Holliston Realty, Pinecrest, and the straws, depends on the provision of § 59 which allows "a person other than the person to whom a tax on real estate is assessed" to seek an abatement of a tax on real estate if he "is the owner thereof, or has an interest therein, or is in possession thereof, and pays the tax." Once a person brings himself within this provision, "he may thereafter prosecute in his own name any application, appeal or action provided by law for the abatement or recovery of such tax." For the purpose of this analysis, we assume that the appellants had an "interest" in the real estate assessed to Holliston Realty, Pinecrest, and McPherson's straws.

By the express terms of G.L. c. 59, § 59, a person having an "interest" in real estate has the right to apply for an abatement of a tax assessed thereon to another person only if he or she "pays the tax." Boston Five Cents Savs. Bank v. Assessors of Boston, ...