Mead v. Beaufort Cnty. Assessor

• Decision Date: 21 December 2016
• Docket Number: Appellate Case No. 2014-002355,Opinion No. 5460
• Citation: 419 S.C. 125,796 S.E.2d 165
• Court: South Carolina Court of Appeals
• Parties: Frank R. MEAD, III, Respondent, v. BEAUFORT COUNTY ASSESSOR, Appellant.

419 S.C. 125

796 S.E.2d 165

Frank R. MEAD, III, Respondent,

v.BEAUFORT COUNTY ASSESSOR, Appellant.

Appellate Case No. 2014-002355

Opinion No. 5460

Court of Appeals of South Carolina.

Heard April 13, 2016

Filed December 21, 2016

Rehearing Denied February 23, 2017

Stephen P. Hughes and James Andrew Yoho, both of Howell Gibson & Hughes, PA, of Beaufort, for Appellant.

Burnet Rhett Maybank, III and James Peter Rourke, both of Nexsen Pruet, LLC, of Columbia, for Respondent.

KONDUROS, J.:

In this appeal from the administrative law court (ALC), the Beaufort County Assessor appeals the ALC's reversal of the Assessor's determination Frank Mead, III was not eligible for the homestead exemption in 2011 because for over fourteen days that year he rented out the home he owned. The Assessor contends the ALC erred in finding the primary residence classification and homestead exemption are unrelated. We affirm as modified.

FACTS/PROCEDURAL HISTORY

Mead was born in 1939 and turned sixty-five years old in 2004. Mead owns one home, which is located on Hilton Head Island, South Carolina. He purchased the home in 1976. From 2005 to 2010, he received the homestead exemption on his property. In 2011, he rented his home out for at least one hundred thirty-eight days. While his home was being rented, he traveled or stayed in an apartment for which he paid rent.

The Assessor revoked Mead's homestead exemption for the 2011 tax year because she believed his property no longer qualified for it as a result of his renting out his home for more than fourteen days. Mead appealed the determination to the Beaufort County Tax Equalization Board. Following a conference with both parties' attorneys, the Board denied Mead's relief by letter.

Mead requested a contested case hearing before the ALC. Both parties filed motions for summary judgment, agreeing the sole issue was whether the homestead exemption under section 12-37-250 of the South Carolina Code is available only to property that also qualifies for the preferential residential assessment ratio in section 12-43-220(c) of the South Carolina Code.

Following a hearing, the ALC issued an order granting Mead's motion for summary judgment, finding Mead had met the requirements for the homestead exemption. The ALC determined Mead had been a resident of South Carolina for at least one year, was over the age of sixty-five, was granted the homestead exemption in 2005, and had not done anything that would amount to a change affecting eligibility. The ALC further found the homestead exemption applies to a person's dwelling place and despite Mead's practice of renting out his house and living in a rented apartment, he does not hold out any other property as his primary residence and thus, the subject property is his dwelling place. Additionally, the ALC determined the homestead exemption and the primary residence classification are "two ships in the night" because the two classifications relate to different constitutional provisions, statutes, requirements, incentives, and types of qualifying properties. The ALC further found the fourteen-day rental rule does not apply to the homestead exemption. Accordingly, the ALC granted Mead's motion for summary judgment, finding he was entitled to the homestead exemption for 2011 and subsequent years.

The Assessor filed a motion for reconsideration. The ALC did not rule on the motion, and the Assessor considered the motion to be denied after thirty days pursuant to South Carolina Administrative Law Court Rules. This appeal followed.

STANDARD OF REVIEW

"[T]he South Carolina Rules of Civil Procedure may be applied in proceedings before the ALC to resolve questions not addressed by the ALC rules." Media Gen. Commc'ns, Inc. v. S.C. Dep't of Revenue , 388 S.C. 138, 144, 694 S.E.2d 525, 527–28 (2010) (citing Rule 68, SCALCR). The purpose of summary judgment is to expedite the disposition of cases not requiring the services of a fact finder. George v. Fabri , 345 S.C. 440, 452, 548 S.E.2d 868, 874 (2001). When reviewing the grant of a summary judgment motion, this court applies the same standard that governs the trial court under Rule 56(c), SCRCP ; summary judgment is proper when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Fleming v. Rose , 350 S.C. 488, 493, 567 S.E.2d 857, 860 (2002).

"A court considering summary judgment neither makes factual determinations nor considers the merits of competing testimony; however, summary judgment is completely appropriate when a properly supported motion sets forth facts that remain undisputed or are contested in a deficient manner." David v. McLeod Reg'l Med. Ctr. , 367 S.C. 242, 250, 626 S.E.2d 1, 5 (2006). "[C]ross motions for summary judgments do authorize the court to assume that there is no evidence which needs to be considered other than that which has been filed by the parties." Alltel Commc'ns, Inc. v. S.C. Dep't of Revenue , 399 S.C. 313, 319 n.2, 731 S.E.2d 869, 872 n.2 (2012) (alteration by court) (quoting Harrison W. Corp. v. Gulf Oil Co. , 662 F.2d 690, 692 (10th Cir. 1981) ). "Where cross motions for summary judgment are filed, the parties concede the issue before us should be decided as a matter of law." Wiegand v. U.S. Auto. Ass'n , 391 S.C. 159, 163, 705 S.E.2d 432, 434 (2011). "The question of statutory interpretation is one of law for the court to decide." Alltel Commc'ns, Inc. , 399 S.C. at 316, 731 S.E.2d at 870. "The decision of the [ALC] should not be overturned unless it is unsupported by substantial evidence or controlled by some error of law." Original Blue Ribbon Taxi Corp. v. S.C. Dep't of Motor Vehicles , 380 S.C. 600, 604, 670 S.E.2d 674, 676 (Ct. App. 2008).

I. Chapter 37

The Assessor argues the ALC erred in determining Chapter 37 is the sole determinant of homestead exemption availability and failed to acknowledge section 12-43-220(c) imposes an additional requirement for qualification of the homestead exemption. She also asserts the ALC erred in its interpretation of section 12-37-252. She contends there is not a separate 4% assessment ratio for the homestead exemption; the only 4% assessment ratio is provided by section 12-43-220(c). Additionally, the Assessor maintains the ALC erred in finding the 4% assessment under section 12-37-252 is separate from the 4% assessment under 12-43-220(c) because only one 4% assessment is authorized by the South Carolina Constitution.¹ We disagree.

(A) Pursuant to the provisions of [s]ection 3, [a]rticle X of the [s]tate [c]onstitution and subject to the provisions of [s]ection 12-4-720, there is exempt from ad valorem taxation:

...

(9) a homestead exemption for persons sixty-five years of age and older, for persons permanently and totally disabled and for blind persons in an amount to be determined by the General Assembly of the fair market value of the homestead under conditions prescribed by the General Assembly by general law....

S.C. Code Ann. § 12-37-220(A) (2014) ; see also S.C. Const. art. X, § 3 ("There shall be exempt from ad valorem taxation ... (i) a homestead exemption for persons sixty-five years of age and older, for persons permanently and totally disabled and for blind persons in the amount of ten thousand dollars of the fair market value of the homestead under conditions prescribed by the General Assembly by general law; provided , that the amount may be increased by the General Assembly by general law, passed by a majority vote of both houses....").

The first fifty thousand dollars of the fair market value of the dwelling place of a person is exempt from county, municipal, school, and special assessment real estate property taxes when the person:

(i) has been a resident of this [s]tate for at least one year and has reached the age of sixty-five years on or before December thirty-first;

....

S.C. Code Ann. § 12-37-250(A)(1) (2014). " ‘Dwelling place’ means the permanent home and legal residence of the applicant." S.C. Code Ann. § 12-37-250(A)(5) (2014).

"The homestead exemption initially granted pursuant to [s]ection 12-37-250 continues to be effective for successive years in which the ownership of the homestead or the other qualifications for the exemption remain unchanged." S.C. Code Ann. § 12-37-255(A) (2014). "Notwithstanding any other provision of law, property that qualifies for the homestead exemption pursuant to [s]ection 12-37-250 is classified and taxed as residential on an assessment equal to four percent of the property's fair market value." S.C. Code Ann. § 12-37-252(A) (2014).

When a person qualifies for a refund pursuant to [s]ections 12-60-2560 and 12-43-220(c) for prior years' eligibility for the four percent owner-occupied residential assessment ratio, the person also may be certified for a homestead tax exemption pursuant to [s]ection 12-37-250. This refund does not extend beyond the immediate preceding tax year. The refund is an exception to the limitations imposed by [s]ection 12-60-1750.

S.C. Code Ann. § 12-37-252(B) (2014).

The version of section 12-43-220(c) in effect for the 2011 assessment provided:

The legal residence and not more than five acres contiguous thereto, when owned totally or in part in fee or by life estate and occupied by the owner of the interest, ... are taxed on an assessment equal to four percent of the fair market value of the property. If residential real property is held in trust and the income beneficiary of the trust occupies the property as a residence, then the assessment ratio allowed by this item applies if the trustee certifies to the assessor that the property is occupied as a residence by the income beneficiary of the trust. When the legal residence is located on leased or rented property and the residence is owned and occupied by the owner of a residence on leased property, even though at the end of the lease period the lessor becomes the owner of the residence, the assessment for the residence is at the same ratio as provided in this item. If the

...