Ewert v. City of Winthrop

• Citation: 278 NW 2d 545
• Decision Date: 13 April 1979
• Docket Number: No. 47976.,47976.
• Parties: In the Matter of the Appeal of Lavern L. EWERT and Elaine L. Ewert, His Wife, and Einar R. Olson and Irene F. Olson, His Wife, from the Assessments Adopted on September 11, 1975, by the City Council of the City of Winthrop, for Improvements of Certain Lands, Appellants, v. CITY OF WINTHROP, Respondent.
• Court: Minnesota Supreme Court

278 N.W.2d 545 (1979)

In the Matter of the Appeal of Lavern L. EWERT and Elaine L. Ewert, His Wife, and Einar R. Olson and Irene F. Olson, His Wife, from the Assessments Adopted on September 11, 1975, by the City Council of the City of Winthrop, for Improvements of Certain Lands, Appellants, v. CITY OF WINTHROP, Respondent.

No. 47976.

Supreme Court of Minnesota.

April 13, 1979.

MacKenzie, Gustafson, Litynski & Lucas and Malcolm K. MacKenzie, Gaylord, for appellants.

Thomas G. McCarthy, Winthrop, for respondent.

Heard before SHERAN, C. J., and YETKA and SCOTT, JJ., and considered and decided by the court en banc.

YETKA, Justice.

Appeal by appellants Lavern L. Ewert and Elaine L. Ewert, his wife, and Einar R. Olson and Irene Olson, his wife, from an order of the district court of Sibley County, dated October 4, 1976, finding that special assessments adopted by the city council of respondent city of Winthrop "did not exceed the special benefits conferred upon the lands of the appellants," and judgment entered on April 25, 1977. We reverse and remand.

The legal issues appellants raise are:

1. Did the increase in market value resulting from the improvements to appellants' lots equal or exceed the amount of the assessments levied for those improvements?

2. Is one who appeals from a special assessment under Minn.St. 429.081 entitled to a jury trial?

Appellants Einar and Irene Olson platted First Highland Addition in 1957 and the adjoining Second Highland Addition in 1959. The Olsons sold off several lots in Highland First Addition, primarily to churches, and then platted the Second Highland Addition and sold Block 1 to an army reserve unit. In 1972 they sold remaining lots in both additions to their daughter and son-in-law, the Ewerts, and between 1973 and 1975 the Ewerts made the following sales:

                   Date   Lot Description        Price
                   1973      Pts. 2 & 3, B. 7  (100' X 105')  $1,000
                   1973      Pts. 6 & 7, B. 7  (100' X 105')   1,000
                   1973      Pts. 5 & 6, B. 7  (100' X 105')   1,000
                   1974      8 & pt. 7, B. 6   (100' X 105')   2,200
                   1975      1 & 2, B. 3       (100' X 165')   2,700
                

All of these sales were made before installation of the street and utility improvements. Prior to installation of the improvements, Ewert was able to provide utilities to the lots sold by paying a $300 hook-up charge to the city as utilities were already installed as far as Olson Avenue.

In 1974 and 1975, the Winthrop City Council decided to install all improvements in the entire city where they were not already installed. These improvements included installation of curb and gutter, bituminous surfacing of streets, sanitary sewer, water, and stubbing services into adjacent lots. The project was designated Street Improvement Project No. 1974-1.

At the time the Ewerts owned and were assessed for 13 lots and 3 fractional lots in Highland First Addition, which were being used (both before and after installation) as residential building lots. These 13 lots were being parcelled and sold as 100-foot frontage lots and would have therefore been usable as nine 100-foot lots of depths varying from 105 feet to 165 feet. One lot (Lot 8, Block 4) would have been unsuitable for residential use. They also owned and were assessed for what would amount to five 100-foot by 140-foot lots, one lot 84.6 feet by 200 feet, and eight lots between Western Avenue and Highway 15, in Second Highland Addition. Except for one other small area, the Ewerts' lots in the two Highland Additions were the only lots in the city where all services were installed and assessed.

Prior to the commencement of the construction of improvements and the levying of the assessments on their property, the Ewerts contacted the city council at meetings and the individual members and the mayor several times regarding the need for the improvements and the cost. They filed a formal protest to the amount of the proposed assessment at the public hearing of the Winthrop City Council.

The person who prepared the assessment rolls and the mayor each testified that he did not make a before and after market improvement valuation study regarding the appellants' assessed property. No evidence was presented by either party on whether the voting members of the city council took such before and after valuations into consideration when they adopted the assessment roll.

The total assessments for appellants' property was $59,239.30.¹

On September 30, 1975, appellants appealed the assessments adopted on September 11, 1975, by the city council of the city of Winthrop to the district court of Sibley County. Prior to trial, on May 6, 1976, appellants moved for a jury trial on the issues. That motion was denied. Trial was had before the court on June 14, 1976. On October 14, 1976, the court issued findings of fact, conclusions of law, and an order for judgment, which, in essence, held that the market value of appellants' lands was increased by more than the amounts assessed for these improvements, with one exception specified therein, and that the assessments were therefore proper. Appellants made alternative motions for a new trial or amended findings, which were denied. Judgment was entered, and notice of appeal followed.

1. The first issue is whether the special benefits received by appellants' property as a result of the improvements equalled or exceeded the assessment made. The parties presented conflicting evidence regarding market value of the property before and after the improvements. The trial court made its own findings of fact, from which it concluded that the assessments did not exceed the benefits, and upheld the assessment.²

The role of the district court in reviewing a special assessment was summarized in Joint Independent School District No. 287 v. City of Brooklyn Park, 256 N.W.2d 512, 516 (Minn.1977):

"The levying of a special assessment is a legislative act. When an assessment is regularly made, it is presumed to be lawful and correct and the burden of proof rests upon the objector to demonstrate its invalidity. In re Appeals by Am. Oil Co. v. City of St. Cloud, 295 Minn. 428, 206 N.W.2d 31 (1973); In re Improvement of Superior Street, Duluth, 172 Minn. 554, 216 N.W. 318 (1927). * * *.

"However, the questions of whether the property assessed received any special benefit and whether the assessment exceeds the special benefit are always open for review. E. H. Willmus Prop. Inc. v. Village of New Brighton, 293 Minn. 356, 199 N.W.2d 435 (1972)."

In the instant case, the regularity of the assessment proceedings is not challenged. Appellants are only contesting the amount of the assessment. Because the city is presumed to have set the assessment legally, introduction of the assessment roll into evidence constitutes prima facie proof that the assessment does not exceed the special benefit. An appellant may, however, overcome the presumption by introducing competent evidence that the assessment is greater than the increase in market value of the property resulting from the improvement. E. H. Willmus Properties, Inc. v. Village of New Brighton, 293 Minn. 356, 199 N.W.2d 435 (1972). In this case, appellants introduced such competent evidence — Lavern Ewert's testimony as to the change in value and the testimony of an experienced real estate appraiser. Such testimony was sufficient to overcome the city's prima facie case that the assessment did not exceed the special benefit.

After the city presented its own evidence on this question, the district court had to make a factual determination. Carlson-Lang Realty Co. v. City of Windom, 307 Minn. 368, 370, 240 N.W.2d 517, 519 (1976). Where the landowner maintains that the assessment is excessive, this determination is to be a de novo one. Buettner v. City of St. Cloud, 277 N.W.2d 199 (Minn.1979). If the assessment exceeds special benefits, the action by the public body is a "taking" and is confiscatory. "* * * The value of special benefits is found by determining what increase, if any, there has been in the market value of the benefited land." E. H. Willmus Properties, Inc. v. Village of New Brighton, 293 Minn. 361, 199 N.W.2d 438.

In this case, there was no evidence that the city council considered the market value of appellants' property either before or after the improvements. The testimony of the mayor, the city clerk, and the person who prepared the assessment roll was that no determination of market value was made. The failure of the city to determine the amount of the special benefits prior to adopting the assessment would have allowed the district court to reverse.

Rather than striking down the assessment on this ground, however, the district court received evidence on the market value of appellants' property before and after the improvements. There was substantial conflict in this evidence; the trial court resolved this conflict by adopting the evidence presented by the city's expert and upholding the assessment. Our task now is to review the district court's findings in light of our prior discussion mandating de novo review and impartial scrutiny of all evidence.

The standard for this court in reviewing a district court's confirmation of a special assessment was stated in Carlson-Lang Realty Co. v. City of Windom, 307 Minn. 373, 240 N.W.2d 521:

"The scope of our review is a careful examination of the record to ascertain whether the evidence as a whole fairly supports the findings of the district court and whether these in turn support its conclusions of law and judgment."

Thus, this court need not accept the lower court's findings of fact but may reject those findings if they are not fairly supported by the evidence as a whole.

Both parties presented expert testimony. Both experts were from New Ulm, and both had similar background experience in real estate appraisal. Their methods of appraisal, however, differed. Appellants' expert, Forsberg, looked at the land itself, analyzed the current real estate...