Hackensack Water Co. v. Div. Of Tax Appeals North Bergen Tp.

• Decision Date: 25 April 1949
• Docket Number: Nos. A-129 and A-130, A-128.,s. A-129 and A-130, A-128.
• Citation: 65 A.2d 828
• Parties: HACKENSACK WATER CO. v. DIVISION OF TAX APPEALS et al. (two cases). NORTH BERGEN TP. v. DIVISION OF TAX APPEALS et al.
• Court: New Jersey Supreme Court

65 A.2d 828

HACKENSACK WATER CO.

v.DIVISION OF TAX APPEALS et al. (two cases).

NORTH BERGEN TP.

v.DIVISION OF TAX APPEALS et al.

Nos. A-129 and A-130, A-128.

Supreme Court of New Jersey.

April 25, 1949.

Appeal from former Supreme Court.

Certiorari proceedings by the Hackensack Water Company and the Township of North Bergen in the County of Hudson, a municipal corporation, respectively, to review judgments of the Division of Tax Appeals, State Department of Taxation and Finance, fixing the 1944 and 1946 tax assessments on Water Company's personal property and dismissing Township's appeal from the 1945 assessment, 55 A.2d 903, 26 N.J.Misc. 6. From a judgment of the former Supreme Court, 137 N.J.L. 599, 61 A.2d 187, dismissing the writs as to the 1944 and 1946 assessments and reversing the judgment of the Division of Tax Appeals which dismissed the appeal from 1945 assessment and fixing assessed value of the property for 1945, the Hackensack Water Company appeals.

Judgment of former Supreme Court as to assessments for 1944 and 1946 affirmed, and judgment as to 1945 assessment reversed, and judgment of Division of Tax Appeals as to such assessment affirmed.

Joseph Keane and Milton, McNulty & Augelli, all of Jersey City, for appellant.

Nicholas S. Schloeder, of Union City, for respondents.

OLIPHANT, Justice.

This is a tax case. It is an appeal from judgments of the former Supreme Court upon three writs of certiorari to review three judgments of the Division of Tax Appeals involving assessments of personal property of the appellant located in the Township of North Bergen for the years 1944, 1945 and 1946. The appeals were heard together.

The property consisted of water mains, hydrants, meters, connections, etc., mostly underground, and comprised but part of the entire water system owned by appellant. For the year 1940 the township assessor had fixed a valuation of $1,500,00 on the identical property here involved and on appeal the former Supreme Court established the value, for assessment purposes, at $940,000, Hackensack Water Co. v. State Board of Tax Appeals, 1943, 129 N.J.L. 535, 30 A.2d 400, which was affirmed by the former Court of Errors and Appeals, 1943, Hackensack Water Co. v. North Bergen Tp., 130 N.J.L. 483, 33 A.2d 821. This figure remained until the years here involved.

For 1944 the local assessment was $1,400,000. On the filing of the duplicate by Hudson County Board of Taxation this was reduced, without a hearing having been held, to $940,000. An appeal to the same board, sitting in its appellate capacity, was dismissed for lack of jurisdiction and on appeal to the Division of Tax Appeals the assessment was placed at $1,225,000. 55 A.2d 903, 26 N.J.Misc. 6. This was affirmed by the former Supreme Court, 137 N.J.L. 599, 61 A.2d 187.

As to 1945, the township assessment being at the same figure and which the County Tax Board reduced to $940,000, the township appealed directly to the Division of Tax Appeals, thus by-passing the County Board in its appellate capacity. The Division of Tax Appeals dismissed the appeal on procedural grounds holding the statute required a prior appeal to the Hudson County Board of Taxation. R.S. 54:3-21, 54:2-39, N.J.S.A. This action was reversed by the former Supreme Court which fixed the valuation at $1,225,000.

For 1946, from a local assessment of $1,400,000 the Division of Tax Appeals affirmed a valuation of $1,250,000 placed upon the property by the County Board, which was reduced to $1,225,000 by the former Supreme Court.

Appellant contends inasmuch as the former Supreme Court, whose judgment was affirmed by the Court of Errors and Appeals, placed a valuation of $940,000 on this property for the year 1940, and there being no physical change in the property except its increased age, that valuation should remain except for proper depreciation allowances.

While it is desirable that tax litigation should not be prolonged and continued from year to year and should be brought to an end with definiteness, if possible, it is settled that ‘Each annual assessment of property for taxation is a separate entity, distinct from the assessment of the previous or subsequent year.’ United New Jersey R. & Canal Co. v. State Board, etc., Sup.1925, 101 N.J.L. 303, 128 A. 427, 431; Central R. Co. of New Jersey v. State Tax Dept., Err. & App. 1933, 112 N.J.L. 5, 169 A. 489.

On each assessment the test is does it reflect true value?

A full hearing was had. Both parties relied completely on the testimony of experts, yet appellant's complaint, in short, is that the testimony of the township's witnesses was based entirely on illusory standards and they argue to the effect that reproduction costs, less depreciation or obsolescence, was the controlling element in the case. This is not so, it was merely one of the elements considered.

The constitutional provision, Art. 4, sec. 7, par. 12 of the 1844 constitution, as amended in 1875, N.J.S.A., requires that property should be assessed for taxation at its true value. The statutory criterion, R.S. 54:4-23, N.J.S.A., for determining that value is the consideration of the market value at a fair and bona fide sale by private contract. A selling price is a guiding indicium of fair value and ordinarily is merely evidential although it might under peculiar circumstances become controlling, subject to the limitation that the determination properly involved the weighing and appraising of all component factors and adventitious circumstances. Depreciation and obsolescence are factors in determining value but each is subject to the countervailing factor of an increase in building costs brought about by economic conditions lessening the value of the dollar. A change in the value of money may result in giving the property a market value which, for a compensating period, disregards allowances for depreciation and obsolescence. True value of property of any kind is in the essence, the value which it has in exchange for money. L. Bamberger & Co. v. Division of Tax Appeals, Sup.1948, 62 A.2d 389; North Bergen Tp. in Hudson County v. Bergen Blvd. Holding Co., Err. & App. 1946, 133 N.J.L. 569, 45 A.2d 623; Cf. New Jersey Bell Tel. Co. v. City of Newark, Sup.1937, 118 N.J.L. 490, 193 A. 844, affirmed Err. & App. 1940, 124 N.J.L. 451, 12 A.2d 675; State Board of Assessors v. Central R.R. Co., Err. & App. 1886, 48 N.J.L. 146, page 311, 4 A. 578.

We are not in accord with the opinion of the Supreme Court wherein it speaks of changed economic conditions justifying ipso facto an increase in valuation. This in itself is not a sufficient reason for an increase in valuation any more than a depression would call for a downward revision in accordance with new market conditions thereby created, however, temporary. Value for the purposes of taxation has some measure of permanency which renders it secure against general temporary inflation or deflation.

It is not possible to measure with mathematical precision the value of the property here assessed. The market affords no test for such properties as they are rarely the subject of sale, but there are numerous factors stated above, which enter into the calculation of the true value of such property. There was competent and conflicting testimony before the Supreme Court with respect to these elements of true value and the Supreme Court pursuant to its statutory duty, R.S. 2:81-8, N.J.S.A., reviewed the law and the facts and found the true value of the properties in question for the years 1944 and 1946, was $1,225,000.

It is a settled rule that findings of fact by the Supreme Court on conflicting evidence, or on uncontroverted evidence reasonably susceptible of conflicting inferences are conclusive on appeal where such findings of fact are based upon competent evidence. Jersey City v. State Water Policy Commission, Err. & App. 1937, 118 N.J.L. 72, 191 A. 456; Dana College v. State Board, etc., Err. & App. 1937, 117 N.J.L. 530, 189 A. 620; West Shore R. Co. v. Board of Public Utility Commissioners, Err. & App. 1934, 112 N.J.L. 83, 169 A. 829; Angelotti v. Town of Montclair, Err. & App. 1932, 109 N.J.L. 360, 162 A. 565; Kohn v. Tilt, Err. & App. 1926, 103 N.J.L. 110, 134 A. 658; Yellow Pine Co. v. State Board of Assessors, Err. & App. 1905, 72 N.J.L. 182, 61 A. 436; Moran v. City of Jersey City, Err. & App. 1896, 58 N.J.L. 653, 35 A. 284. The findings below as to the years 1944 and 1946, being supported by competent proof are hereby affirmed.

These causes arose under the old constitution and we find no occasion to apply Rule 1:2-20.

The...