Gianolio v. Markham

• Decision Date: 14 March 1978
• Citation: 564 So.2d 1131
• Parties: 15 Fla. L. Weekly D1712 Marie E. GIANOLIO, as Trustee under the Marie E. Gianolio Revocable Trust Agreement Dated
• Court: Florida District Court of Appeals

Page 1131

564 So.2d 1131

15 Fla. L. Weekly D1712

Marie E. GIANOLIO, as Trustee under the Marie E. Gianolio Revocable Trust Agreement Dated March 14, 1978, as amended, and Marie Gianolio and Gloria Bernreuter, as Trustees under the James J. Gianolio Revocable Trust Agreement, dated March 14, 1978, as amended, and Shannon Development Corp., a Florida corporation, and PB Joint Venture No. 1, Inc., a Florida corporation, d/b/a Stirling Farms, a Florida joint venture, Appellants, v. William MARKHAM, as Broward County Property Appraiser; Joseph E. Rosenhagen, as Broward County Revenue Collector, and Randy Miller, as Executive Director, Department of Revenue, State of Florida, Appellees.

No. 88-3477.

District Court of Appeal of Florida,

Fourth District.

June 27, 1990.

Swope and Stobbs, Miami Shores, Shapo, Freeman & Freedman, P.A., and H. Robert Koltnow of H. Robert Koltnow, P.A., Miami, for appellants.

B. Jordan Stuart of Law Offices of Gaylord A. Wood, Jr., Fort Lauderdale, for appellee-William Markham, as Broward County Property Appraiser.

HERSEY, Chief Judge.

This is an appeal of three final judgments upholding a decision of the Broward County Property Appraiser denying agricultural classification for appellants' property for the years 1984, 1985 and 1986 for ad valorem tax purposes. For the reasons which follow, we reverse.

The record indicates that the property in question was acquired by the Gianolio family in 1955. It was thereafter operated as a family-run dairy until May 1987. For each of the years from 1955 to 1984 the property had been classified as agricultural.

In 1980 the Gianolios contracted to sell the land to a developer. The contract was subject to the condition precedent that the property be rezoned to nonagricultural use. That occurred in August 1986 and the property was sold at that time. However, the buyer was always free to waive the condition and close at any time.

After the contract was signed the developer undertook extensive efforts to have the property rezoned to nonagricultural use. When those efforts were not successful with the county, the developer sought annexation of the land into Cooper City. The Gianolios cooperated with the developer by signing the necessary papers for the annexation and permitting surveyors on the land.

The property appraiser, appellee, determined from this that the land was not being used primarily for bona fide agricultural purposes and denied it agricultural classification for the years 1984, 1985, and 1986.

The trial court agreed, finding that appellants had not met their burden of excluding every reasonable hypothesis which would support the property appraiser's determination. This appeal followed.

Section 193.461, Florida Statutes (1989), deals with the agricultural classification and assessment of property. Subsection (1) of that statute directs the property appraiser to annually classify all county land as either agricultural or nonagricultural. The standard for classifying land as agricultural is set forth in subsection (3)(b) which states:

[O]nly lands which are used primarily for bona fide agricultural purposes shall be classified as agricultural. 'Bona fide agricultural purposes' means good faith commercial agricultural use of the land. In determining whether the use ... is bona fide, the following factors may be taken into consideration:

1. The length of time the land has been so utilized;

2. Whether the use has been specific;

3. The purchase price paid;

4. Size, as it relates to specific agricultural use;

5. Whether an indicated effort has been made to care sufficiently and adequately for the land in accordance with accepted commercial agricultural practices, including, without limitation, fertilizing, liming, tilling, mowing, reforesting, and other accepted agricultural practices;

6. Whether such land is under lease and, if so, the effective length, terms, and conditions of the lease; and

7. Such other factors as may from time to time become applicable.

§ 193.461(3)(b) Fla.Stat. (1989).

Thus, in addition to establishing that the actual physical use of the land is agricultural, the taxpayer must show that such use is both "primary" and "bona fide." This court defined the terms "primary" and "bona fide" in Hausman v. Rudkin, 268 So.2d 407, 409 (Fla. 4th DCA 1972) as follows:

The term 'primarily' simply signifies that the agricultural use must be the most significant activity on the land where the land supports diverse activities. (citation omitted). The terms 'bona fide' as used in the statute impose the requirement that the agricultural use be real, actual, of a genuine nature-- as opposed to a sham or deception. (citation omitted).

The property appraiser determined that, although the actual physical use of the land was agricultural, such use was neither "primary" nor "bona-fide." The "primary" use of the land, appellee determined, was real estate development. The operation of the dairy was only incidental to that purpose. The property appraiser further found that the dairy operation was not "bona fide," but rather, a sham.

In challenging those findings in this court, appellants carry a heavy burden. The applicable standard of review has been stated by the supreme court as follows: "[Property] assessors are constitutional officers and as such their actions are clothed with a presumption of correctness. One asserting error on the part of the [property] appraiser must show by 'proof' that every reasonable hypothesis has been excluded which would support the property appraiser. (citation omitted)." Straughn v. Tuck, 354 So.2d 368, 371 (Fla.1977). See also Markham v. June Rose, 495 So.2d 865, 866 (Fla. 4th DCA 1986).

However, although it is presumed that the determinations of property appraisers are correct, the presumption is rebuttable. If the taxpayer can demonstrate that the property appraiser abused his discretion or failed to follow the required statutory procedures, his determination will not be entitled to the presumption of correctness. 51 Fla. Jur.2d Taxation § 18:86 (1984).

Appellants argue that the property appraiser's determination that the land was not being used "primarily" for agricultural purposes is flawed because it ignores the undisputed facts and the relevant case law.

The property appraiser's theory was that development is a long process that begins not when the first bulldozer comes on the property but rather much earlier, with the applications for development approval, zoning changes, land use changes and annexation, such as took place here. The basic thrust of the appraiser's theory appears to be that because appellants cooperated with the developer in his efforts to obtain rezoning, the property was "primarily" being used for real estate development.

Appellants correctly contend that the property appraiser's theory does not withstand scrutiny. To begin with, it is contrary to the established meaning of "primary" as defined by the Florida courts. As already noted, the term "primary" was defined by this court in Hausman as "signifying that the agricultural use must be the most significant activity on the land where the land supports diverse activities." Id. at 409. It is undisputed that there was absolutely no nonagricultural, i.e. commercial, activity on the land during the years in question. And thus it cannot seriously be argued that the dairy operation was not the most significant activity conducted on the land during that time.

Moreover, the weight of the case law supports appellants' argument. "[Physical] use [of the land] is still the guidepost in classifying land, although other specifically enumerated factors relative to use may also be considered. Agricultural use is now and has always been the test." Tuck, at 370. In Ridgewood Phosphate Corp. v. Perkins, 487 So.2d 40 (Fla. 2d DCA 1986), the property appraiser denied agricultural classification to a taxpayer whose land, although physically used for grazing cattle, could also be used for mining pursuant to a county permit. Although the land was currently only being used for grazing cattle, it was the taxpayer's intention to use the land for mining in the future and he had conducted certain preparatory activities, such as obtaining a development of regional impact order, to that end. The property appraiser denied agricultural classification to the property determining that the "primary" use of the land was for mineral extraction. The trial court agreed.

In reversing the trial court, the second district stated:

Land used primarily for bona fide commercial agricultural purposes must be classified agricultural. (citation omitted). Here, the lessee's use of the 1,840 acres for grazing cattle clearly qualifies this land for an agricultural classification. (citations omitted). Moreover, Ridgewood's intention to use the leased land for mining and its preparatory activities for that future use were insufficient to deny agricultural classification. (citation omitted).

Id. at 41-42. See also Schooley v. Wetstone, 258 So.2d 483, 485 (Fla. 2d DCA 1972) (wherein the second district addressed a similar argument by stating, "[t]he contention by appellants that the primary use of the lands is for speculative purposes is of no consequence if its actual use is for a bona fide agricultural purpose." (citations omitted)).

Appellants next argue that the property appraiser's second determination, that the dairy was not a "bona fide" operation is also contrary to the undisputed facts and the relevant case law. As previously noted, "bona fide" means "good faith commercial agricultural use." The supreme court defined "commercial agricultural use" in Tuck as follows: " 'Commercial agricultural use' simply adds another factor, i.e. profit or profit motive, which may be considered by the tax assessor in determining whether or not a claimed agricultural use is bona fide. It does not ... limit agricultural classification to commercially profitable agricultural...