Martin v. Liberty County Bd. of Tax Assessors

• Decision Date: 15 November 1979
• Docket Number: Nos. 58010,58011,s. 58010
• Citation: 262 S.E.2d 609,152 Ga.App. 340
• Parties: MARTIN et al. v. LIBERTY COUNTY BOARD OF TAX ASSESSORS. MARTIN et al. v. LONG COUNTY BOARD OF TAX ASSESSORS.
• Court: Georgia Court of Appeals

Page 609

262 S.E.2d 609

152 Ga.App. 340

MARTIN et al. v. LIBERTY COUNTY BOARD OF TAX ASSESSORS.

MARTIN et al. v. LONG COUNTY BOARD OF TAX ASSESSORS.

Nos. 58010, 58011.

Court of Appeals of Georgia.

Submitted May 30, 1979.

Decided Nov. 15, 1979.

M. F. Martin, III, Brunswick, for appellants.

J. Noel Osteen, Hinesville, for appellee (Case No. 58010).

Albert Kahn, III, Glennville, for appellee (Case No. 58011).

CARLEY, Judge.

Appellant appeals in each case from a final judgment upholding, against his challenge, tax assessments on property located in the respective counties. The issues raised in both appeals are identical and are addressed in the consolidated opinion.

Appellant owns property in Long and Liberty Counties which was leased to a paper company for a thirty-five year period commencing in 1962. As consideration, appellant elected to receive cash payments totalling $216,540 during the first four years of the term and an annual rent in the amount of $2.75 per acre thereafter. The lease further obligated appellant for all ad valorem taxes assessed against the property.

In 1977 the respective county boards increased the appraised and assessed value of appellant's property. The boards did not consider the leasing agreement in determining the assessment against the property. Appellant appealed the reassessments to the County Boards of Tax Equalization which affirmed. Upon further appeal to the Superior Court of Long and of Liberty County, judgments were entered in favor of the county boards, upholding the assessments on appellant's property. While appellant urges several enumerations of error, the determinative issue presented for review is whether or not the county boards should have considered the existing leasing agreement in the determination of the fair market value of the property.

"All property shall be returned for taxation at its fair market value . . ." Code Ann. § 92-5701. The assessments here in issue were for the 1977 tax year. Therefore, the controlling definition of "fair market value" is found in former Code Ann. § 92-5702 (Ga.L.1975, p. 96): "The intent and purpose of the tax laws of this State are to have all property and subjects of taxation returned at the value which would be realized therefrom by cash sale, as such property and subjects are usually sold, but not by forced sale thereof, and the words 'fair market value,' when used in tax laws, shall be held and deemed to mean what the property and subjects would bring at cash sale when sold in the manner in which such property and subjects are usually sold. The tax assessors, in determining fair market value of real property, shall consider the following criteria: (a) existing zoning of property; (b) existing use of property; (c) existing covenants or restrictions in deed dedicating the property to a particular use; or (d) any other factors deemed pertinent in arriving at fair market value."

It is undisputed that the property is being "used" to grow timber. Appellant urges, however, that it is being used to grow timber commercially pursuant to a long-term lease, the terms of which, if considered by the boards, would have an adverse effect on the amount the property would bring at a cash sale.

Appellant's argument is clearly meritless. "In this State there can be several separate and distinct estates in the same parcel of land, and Code § 92-104 requires the owner of any estate in land less than the fee to return it for taxes and pay taxes on it as on other property. A leasehold is an estate in land less than the fee; it is severed from the fee and classified for tax purposes as realty. (Cit.)" Delta Air Lines, Inc. v. Coleman, 219 Ga. 12, 16, 131 S.E.2d 768, 771 (1963). Thus, when appellant conveyed an estate for years in his property, he conveyed a distinct estate in his land which carried with it a tax liability to the lessee. Ferguson v. Leggett, 226 Ga. 333, 174 S.E.2d 913 (1970). Appellant however, assumed the obligation to pay all taxes assessed against the property, including that which would otherwise be assessable against the leasehold. Trust Co. of Ga. v. S & W Cafeteria, 97 Ga.App. 268, 103 S.E.2d 63 (1958). Under these circumstances, the existence or nonexistence of a leasehold in his property would have no bearing on appellant's ultimate tax liability. That liability is based, in the final analysis, on the sum total of the respective "fair market values" of the taxable estates in the property. Thus, appellant's tax liability is predicated upon the "fair market value" of the fee the unity of his and his lessee's interests in the property without consideration of its division into constituent estates. Appellant's argument that consideration should be given to the existence of the lease and its adverse effect on the "fair market value" of the property...