International Place Apartments-IV v. Ypsilanti Tp., APARTMENTS--I

• Decision Date: 29 March 1996
• Docket Number: Docket No. 164423,P,APARTMENTS--I
• Citation: 216 Mich.App. 104,548 N.W.2d 668
• Parties: INTERNATIONAL PLACEetitioner-Appellee, v. YPSILANTI TOWNSHIP, Respondent-Appellant.
• Court: Court of Appeal of Michigan — District of US

Page 668

548 N.W.2d 668

216 Mich.App. 104

INTERNATIONAL PLACE APARTMENTS--IV, Petitioner-Appellee, v. YPSILANTI TOWNSHIP, Respondent-Appellant.

Docket No. 164423.

Court of Appeals of Michigan.

Submitted Dec. 19, 1995, at Detroit.

Decided March 29, 1996, at 9:05 a.m.

Released for Publication June 11, 1996.

Honigman Miller Schwartz & Cohn by Jerome M. Salle and Gerard Mantese, Detroit, for petitioner.

Miller, Canfield, Paddock & Stone by Robert F. Rhoades and Joanne B. Faycurry, Detroit, for respondent.

Before MARK J. CAVANAGH, P.J., and SAWYER and R.L. TEMPLIN, ^* JJ.

SAWYER, Judge.

Respondent appeals from a judgment of the Tax Tribunal in favor of petitioner concerning a dispute over the 1988 assessed value of petitioner's property. We affirm.

The facts in this case are undisputed. Petitioner's apartment complex consisted of five buildings, numbered 18 through 22, containing 199 rental units. On December 31, 1986, respondent evaluated this complex and notified petitioner that the proposed assessed value was $388,900. This determination was acceptable to petitioner.

On March 15, 1988, respondent sent a letter to petitioner's manager, Mario Cardinali, which confirmed the amount of $388,900 as the final 1987 assessment and notified him of the proposed 1988 assessment of $480,340. Again, this determination was acceptable to petitioner.

On September 19, 1989, respondent sent a letter to petitioner indicating a proposal to change the 1988 assessment to $1,337,000. The letter explained that respondent's assessment office had made a clerical error that had resulted in the underassessment of petitioner's property. On December 5, 1989, the Ypsilanti Township Board of Review notified petitioner that it had changed the assessment in accordance with respondent's request.

Respondent's deputy assessor, Denise Mays, explained that respondent conducted annual field inspections regarding building permits. Respondent kept a file for active building permits. When making a property appraisal, an assessor would pull the building permit from this file. After reviewing the construction, the assessor would post the appraised value and enter it into respondent's computer. If construction of a building was complete, the building permit was filed elsewhere or discarded. If construction was not yet complete, the assessor would write the percentage of construction completed on the permit and return the permit to the active file.

Clair Simons, an assessor no longer working for respondent, conducted the field inspection of petitioner's property in December 1986. At that time, construction was not complete on petitioner's apartment buildings, so the building permit should have been filed in the active building permit file. Instead, the permit was filed in the field card file, where it should have gone only if construction was complete.

Construction was completed in March 1987, but respondent was unaware that a new field inspection was required because the building permit was no longer in the active file. The added value of the completed construction, therefore, was not included in respondent's original determination of the property's value as of December 31, 1987, which was used for the 1988 assessment. Instead, respondent simply applied a five percent increase, as it did for all properties for which construction was completed. Had the permit been in the correct file, Mays testified, respondent would have been on notice that a field inspection and a new assessment were required.

Sam Guich took over as respondent's chief assessor in August 1988, and immediately began reappraising commercial property. Petitioner's property was assessed at $2,085,000 for 1989. Guich and Mays noticed the large difference between the 1988 and 1989 values and sought to determine the reason. In November or December of 1988, they discovered the building permits in the field card file and in July or August of 1989 found a letter from Simons to Cardinali in an inactive file for township apartment properties. That letter, dated February 5, 1987, indicated that all of buildings twenty and twenty-one and forty percent of building twenty-two were included in the assessment for 1987. According to Guich, buildings eighteen and nineteen were not constructed until late 1986 or early 1987, and Simons therefore did not include them. Guich decided that the filing error that resulted in petitioner's underassessment was clerical and, therefore, correctable under § 53b of the General Property Tax Act, M.C.L. § 211.53b; M.S.A. § 7.97(2). However, the Tax Tribunal concluded that the error was not a clerical one, but one of professional judgment, and, therefore, the board of review was not empowered to change the 1988 assessment under § 53b.

Respondent first argues that the Tax Tribunal erred in concluding that the misfiling that caused the wrong assessment figure was not a clerical error correctable under § 53b. We disagree. Subsection 1 of § 53b provides in pertinent part as follows:

If there has been a clerical error or a mutual mistake of fact relative to the correct assessment figures, the rate of taxation, or the mathematical computation relating to the assessing of taxes, the error or mutual mistake shall be verified by the local assessing officer, and approved by the board of review.... If the error or mutual mistake results in an overpayment or underpayment, the rebate shall be...