Menard, Inc. v. County of Clay, 14-CV-12-1500
| Decision Date | 29 January 2016 |
| Docket Number | 14-CV-14-1352,14-CV-13-1405,14-CV-12-1500,14-CV-13-1454 |
| Parties | Menard, Inc., Petitioner, v. County of Clay, Respondent. |
| Court | Tax Court of Minnesota |
This matter came before The Honorable Bradford S. Delapena, Judge of the Minnesota Tax Court, on the parties' separate motions for amended findings of fact, conclusions of law, and order for judgment.
Robert A. Hill, Attorney at Law, represented petitioner Menard, Inc.
Thomas J. Radio, Felhaber Larson, and Jenny M. Samarzja, Assistant Clay County Attorney, represented respondent Clay County.
ORDER ON PARTIES' MOTIONS FOR AMENDED FINDINGS OF FACT, CONCLUSIONS OF LAW, AND ORDER FOR JUDGMENT
These cases concern the market value of the Menards home improvement store in Moorhead, Minnesota, as of January 2 2011, 2012, 2013, and 2014. On September 18, 2015, we filed Findings of Fact, Conclusions of Law, and Order for Judgment concluding that the assessor's estimated market value for the subject property overstated its market value as of each valuation date and ordering appropriate tax re-computations and refunds. Menard, Inc. v. Cty. of Clay, No 14-CV-12-1500 et al., 2015 WL 5944893 (Minn. T.C. Sept. 18, 2015) (Trial Order). On October 1, 2015, the parties filed separate motions for amended findings of fact, conclusions of law, and order for judgment. We grant in part and deny in part each party's motion.
Based upon all of the files, records, and proceedings herein, the court now makes the following:
1. Finding of Fact No. 25 is amended as follows:
The subject property suffered from physical deterioration of $1, 619, 533 $1, 508, 693 on the 2011 valuation date; $1, 701, 853 $1.542.638 on the 2012 date; $2, 196 350 $1.971.685 on the 2013 date; and $2, 711, 620 $2.419.257 on the 2014 date.
2. Finding of Fact No. 28 is amended as follows:
The subject property's indicated market value under the cost approach was $9, 121, 382 $9.262.222 for the 2011 valuation date; $9, 302, 631 $9.461.846 for the 2012 date; $9, 016, 960 $9.271.625 for the 2013 date; and $8, 712, 890 $9.068.252 for the 2014 date.
3. Finding of Fact No. 33 is amended as follows:
The market value of the subject property for each valuation date is as follows:
Cost Approach
$9, 121, 382
$9, 302, 631
$ 9, 016, 960
$ 8, 712, 890
Cost Approach
$ 9.262.222
$9.461.846
$ 9.271.625
$ 9.068.252
Sales Approach
$ 4, 898, 122
$ 5, 010, 462
$ 5, 390, 987
$ 6, 044, 243
Market Value
$ 7, 432, 100
$ 7, 585, 800
$ 7, 219, 000
$ 7, 393, 600
Market Value
$ 7, 516, 600
$ 7, 681, 300
$ 7, 331, 300
$ 7, 556, 200
4. Finding of Fact No. 34 is added, to read as follows:
A nine-month Minnesota Department of Revenue sales-ratio study of commercial/industrial property in Clay County indicates a median ratio of 88.4 percent for the 2011 assessment date.
5. Conclusion of Law No. 6 is added, to read as follows:
The 2011 market value determined by the court is reduced by 6.6 percent (from $7, 516, 600 to $7, 020, 500) to equalize the subject property's value with similarly classed properties in the same taxing district.
6. The parties' motions for amended findings of fact, conclusions of law, and order for judgment are in all other respects denied.
5. Real estate taxes due and payable in 2012, 2013, 2014, and 2015 shall be recomputed accordingly and refunds, if any, paid to petitioner as required by such computations, together with interest from the original date of payment.
IT IS SO ORDERED. THIS IS A FINAL ORDER. LET JUDGMENT BE ENTERED ACCORDINGLY.
MEMORANDUMEach party has submitted a three-part motion for amended findings. Menard argues: (1) that we must use as comparable sales all of the big box retail store transactions about which its appraiser, Mr. MaRous, provided information;[1] (2) that we should fully credit MaRous' cost approach, but should give that approach no weight in our final reconciliation (and should rely entirely on the sales comparison approach);[2] and (3) that we erred by not granting its unopposed request for equalization relief for the 2011 valuation date.[3] The County contends: (1) that we should have rejected Mr. MaRous' appraisal report in its entirety;[4] (2) that we should make several changes to our cost approach;[5] and (3) that we should have considered as comparable sales additional transactions about which its appraiser, Mr. Vergin, provided information.[6]
On proper motion, a court may "amend its findings or make additional findings." Minn. R. Civ. P. 52.02; see also Minn. Stat. § 271.08, subd. 1 (2014) (authorizing motions for amended findings of fact and conclusions of law). A motion for amended findings authorizes a court "to review all of the evidence and all of [its] findings" and to revise its findings in a manner either favorable or unfavorable to the moving party. McCauley v. Michael, 256 N.W.2d 491, 499-500 (Minn. 1977). Ultimately, the court is "free to examine all of the evidence ..., and then to enter amended findings as appear ... warranted by [its] review of the record as a whole." Id. at 500.
"[T]he tax court typically determines '[t]he weight and credibility of ... testimony, including that of the expert witnesses.' " Beck v. Cty. of Todd, 824 N.W.2d 636, 639 (Minn. 2013) () (citations omitted). Consequently, a party proposing additional findings must do more than simply point to record evidence that might support those findings. Nielsen v. City of Saint Paul, 252 Minn. 12, 29, 88 N.W.2d 853, 864 (1958). "[T]he moving party must show that the ... court was compelled to make the requested findings and failed to do so ...." Zander v. State, 703 N.W.2d 845, 857 (Minn.App. 2005) (emphasis added). Correlatively, a party requesting the excision of existing findings must show that they have insufficient evidentiary support. See Kehrer v. Seeman, 182 Minn. 596, 602, 235 N.W. 386, 389 (1931) ().
A motion for amended findings must be based on the files and exhibits in the case, not on evidence that is not part of the record. Zander v. Zander, 720 N.W.2d 360, 364 (Minn.App. 2006). The moving party "should address the record evidence, explain why the record does not support the district court's findings, and explain why the proposed findings are appropriate." Lewis v. Lewis, 572 N.W.2d 313, 316 (Minn.App. 1997), abrogated on other grounds by Madson v. Minn. Mining & Mfg. Co., 612 N.W.2d 168, 171-72 (Minn. 2000).[7]
We agree with Menard that we erred by failing to grant its unopposed request for equalization relief with respect to the 2011 valuation date.[8] Grateful for the opportunity to correct this oversight, we grant the request without further discussion. See supra, Order ¶¶ 4-5 ( Trial Order by adding one factual finding and one conclusion of law).
Mr MaRous considered two sets of comparable sales: a primary set that he adjusted and relied on in his sales comparison analysis, [9] and a secondary set that he neither adjusted nor relied on (other than as generally supporting that analysis).[10] MaRous also computed for each set an average total depreciation figure, [11] which he used in his cost approach to support a separately derived total depreciation estimate of approximately 80 percent for the subject property.[12]
The court's sales comparison analysis used as comparable sales three of the seven transactions from MaRous' primary set, and none of the twenty from his secondary set. Menard, 2015 WL 5944893, at *19-20, *23. Our cost approach rejected as unreliable the average total depreciation MaRous computed for his primary set, and declined even to consider the computation for his secondary set. Id. at * 16-18 & n. 139.
Menard's written submission urges us to reconsider our "rejection of the 24 sales of big box retail stores Menards offered to demonstrate the most probable sales price for the subject property." [13] During a motion hearing, however, Menard clarified that it is not asking us to rely on MaRous' secondary set of comparables in our sales comparison approach.[14] Instead, it asserts only that we should have credited MaRous' total depreciation estimates (based on his primary and secondary sets), and should have used those estimates in our cost approach.[15] Menard also qualified its assertion that we should have considered the four remaining comparables from MaRous' first set in our sales comparison approach.[16]
1. Use to Estimate Total Depreciation
According to Menard, we erred because appraisal theory recommends the very market extraction method of computing total deprecation MaRous used to verify his separately derived 80-percent depreciation estimate.[17] As the Trial Order makes plain however, we did not disagree with MaRous' selection of the market extraction method. Instead, we emphasized that the method is reliable only when applied to truly comparable properties. Menard, 2015 WL 5944893, at * 16-18. As we explained, the...
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