Mid-Island Shopping Plaza, Inc. v. Podeyn

Decision Date09 August 1960
Docket NumberMID-ISLAND
Citation25 Misc.2d 972,204 N.Y.S.2d 11
PartiesApplication ofSHOPPING PLAZA, INC., Petitioner, v. Emil M. PODEYN, Frank A. Pelcher, Christian T. Carl, Lester W. Rawlings and Howard C. Hicks, constituting the Board of Assessors of the County of Nassau, Respondents, for review of a tax assessment under Article 13 of the Tax Law.
CourtNew York Supreme Court

Sprague & Stern, Mineola, for petitioner.

G. Burchard Smith, by Le Roy Edwards and George Greenstein, Mineola, for respondents.

HOWARD T. HOGAN, Justice.

This is a consolidated certiorari tax proceeding brought pursuant to Article 13 of the Tax Law* to review the assessments for the tax years 1957-1958 through 1959-1960, upon the Mid-Island Shopping Plaza in Hicksville, Nassau County.

After weighing the evidence, the Court finds the proper values to be as follows:

              Actual Value
                         -----------------------
                               Land     Total
                         ----------  -----------
                1957-58  $1,980,000  $10,000,000
                1958-59   1,980,000   10,000,000
                1959-60   1,980,000   10,000,000
                

It further finds that the ratio of assessed valuation to actual value prevailing in Nassau County for the years stipulated by the parties, to be 35.88%, and that this must be applied to the subject property with the result that the proper assessed valuation is as follows:

          Assessment Valuation
                         ----------------------
                            Land       Total
                         ----------  ----------
                1957-58    $710,424  $3,588,000
                1958-59     710,424   3,588,000
                1959-60     710,424   3,588,000
                
Memorandum

These consolidated proceedings are brought under Article 13 of the Tax Law to review the assessments upon certain real property situated in the County of Nassau for the tax years beginning May 1, 1957, May 1, 1958 and May 1, 1959.The nine tax lots involved are numbered 1243 to 1251 inclusive, and lie in section 11, block D, on the Tax Map of Nassau County.For the purposes of this proceeding, it was stipulated that all of them be considered as one tax lot without separate reference to each.It was further stipulated that the proceedings for each of the three tax years be tried together on the issue of valuation.The total of the assessments under review are as follows:

 1957-58 $4,675,580 (Land and Improvements)
                 1958-59 4,764,410 (Land and Improvements)
                 1959-60 4,772,780 (Land and Improvements)
                

Respondents have admitted in response to petitioner's demand, 'that Forty (40%) per centum, is the ratio which the assessed valuation of the real property of the tax district bears to its full value'(filed paper dated April 3, 1959.)This indicates that the following are the true values for petitioner's property as found by them:

 1957-58 $11,688,950
                 1958-59 11,911,025
                 1959-60 11,931,950
                

The petitions are based solely on the allegation of inequality, and state that '* * * the instances in which said inequality exists * * *' are '* * * all other property within said County of Nassau assessed upon said assessment roll other than said property of petitioner.'

This leaves two issues for determination by the Court--the true or actual value of petitioner's property and the ratio between true value and assessed value prevailing in Nassau County.The application of this general ratio to the actual value of the petitioner's property as found will determine the correctness of the respondents' assessments.

The Court will deal first with the problem of ratio.Unlike the Board of Assessors of the City of New York, the Board of Assessors of Nassau County does not assess taxable property at its actual present value, but at its value or construction cost as it was, or would have been, in 1938.The ratio between this figure and the actual present value of property is expressed in terms of percentage.Petitioners, as aforesaid, served a demand pursuant to section 292-a of the Tax Law, dated March 18, 1959 that the respondents admit that this ratio is 36%.Respondents served a denial, dated April 3, 1959, admitting, however, that the ratio is 40%.

Section 293 of the Tax Law(now section 720 of the Real Property Tax Law) provided two methods of ascertaining what actual ratio was being applied.The first was by the appraisal of the true value of a number of parcels of real property either agreed upon by the parties, or selected by the Court, said valuations to be without reference to assessed valuations.Such appraisals would then be compared with the corresponding assessed valuations of the respective properties and the resulting ratio could be accepted as evidence in the proceeding before the Court.

The second was based, not upon the appraisal of selected properties, but upon '* * * evidence as to actual sales of real property within the tax district that occurred during the year in which the assessment under review was made.'It provided that this evidence could be given by either party.

The latter method was used by the Referee and approved by the Court in Borst v. Board of Assessors of City of Amsterdam, 6 Misc.2d 945, 160 N.Y.S.2d 187.

It was also approved by the Court of Appeals in People ex rel. Yaras v. Kinnaw, 303 N.Y. 224, at page 233, 101 N.E.2d 474, at page 478, when the Court stated:

'The only other evidence properly to be considered was that of sales made in Albany in the year ending August 31, 1948.* * * This line of evidence--and it is entitled to substantial weight under section 293--would indicate a ratio of 61.5%.'

Petitioner elected to use this latter method exclusively.The respondents, if they had wished, might have availed themselves of either method, and, if the parcels of property to be valued under the first method could not be agreed upon the Court would have selected them.They chose, however, to use neither, nor did they challenge during the trial the accuracy of the figures offered by the petitioner, although they had reserved their right to do so.

However, they raised in their memorandum the objections that some of the sales may not have been at arm's length, but, with the opportunity to examine them they produced no evidence of any such sales.

They further objected that there was no distinction made between improved and unimproved land.This has no merit, since the ratio must be applied uniformly to every type of taxable real property.

The method by which the petitioner assembled its proof, in essence was as follows: It obtained a stipulation from the respondents that the ratio issue would be tried on the basis of the assessment roll made public on May 1, 1957 and that '* * * the result will apply equally to the two other years, namely, 1958 and 1959.' and a further stipulation that '* * * the revenue stamps appearing on the deeds may be used as evidence of the sales price where sales are referred to, but each party reserves the right to produce additional evidence with respect to the consideration in any one sale if he so advises.'

It retained one W. Edwards Deming, a consultant statistician and a professor of statistics at the Graduate School of Business Administration of New York University, whose education and experience, as spread upon the record, qualified him in his field beyond question, to obtain a fair sampling of the deeds recorded in the office of the Clerk of Nassau County between May 1, 1956 and April 30, 1957.This witness, using a scientifically devised table of random sampling numbers, compiled lists referrable to pages in the Libers of Conveyances for this period.The consideration for each recorded transaction was then determined from the documentary stamps. 340 such sales were tabulated in this fashion.In addition, every sale in the County during the year, in which the consideration was reported in a publication known as 'Nassau Realty Statistics' to be $75,000 or more, was examined.Approximately 190 sales in this latter group were included in the tabulation.

Then the assessment rolls for the period commencing May 1, 1957 were examined and the assessment of each individual property was set against its sales price.The results of the computations of ratio were as follows:

The total of the assessed valuations of all the properties sold for $75,000 or more was 32.36% of the total of all the reported sales prices.When the ratio of the assessed value of cach parcel to its selling price was averaged with that of every other ratio in this group the result was an average ratio of 34.38%.

The ratio of totals in the other group was 33.55% while the average of the individual ratios was 33.36%.

Dr. Deming conceded a possible error of 1.5% in either direction.Taking the highest ratio that is, the relation between the averaged selling prices of the properties reportedly sold for amounts in excess of $75,000, to their averaged assessed valuations, and adding 1.5% as the maximum margin of error, the figure 35.88% represents a scientific approach to the true ratio which this Court accepts for the purposes of this proceeding.No evidence tending to disprove or discredit this method of proof was offered by the respondent.They urged only in their memorandum, that some of the sales might have included articles of personal property which were reflected in the purchase price.If the price of these articles was substantial, as in the case of factory machinery, it is reasonable to suppose that it would be treated separately as the sale of personalty, not only to avoid real estate and transfer taxes, but possibly for the purpose of placing chattel mortgages upon them.

At any rate, the number of transactions examined, which must have included many commercial and industrial buildings sold for $75,000 and more, as well as unimproved land, would tend to minimize such possibility of error.

It was said by the Court of Appeals in People ex rel. Hagy v. Lewis, 280 N.Y. 184, at page 188, 20 N.E.2d 386, at page 387:

'Thus the idea of the statute appears to be that a sufficiently approximate arithmetical mean...

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22 cases
  • Slewett & Farber v. Board of Assessors
    • United States
    • New York Supreme Court — Appellate Division
    • 8 Abril 1981
    ...479, 483, 344 N.Y.S. 2d 270). The petitioners contend, however, that the random sampling method used in Matter of Mid-Island Shopping Plaza v. Podeyn, 25 Misc.2d 972, 204 N.Y.S.2d 11, affd. 14 A.D.2d 571, 218 N.Y.S.2d 249, affd. 10 N.Y.2d 966, 224 N.Y.S.2d 283, 180 N.E.2d 63, supra, has bee......
  • Hellerstein v. Assessor of Town of Islip
    • United States
    • New York Court of Appeals Court of Appeals
    • 5 Junio 1975
    ...a uniform rate or percentage of full or mark value for every type of property in the assessing unit. (Matter of Mid-Island Shopping Plaza v. Podeyn, supra (25 Misc.2d 972, 204 N.Y.S.2d 11, aff'd 14 A.D.2d 571, 218 N.Y.S.2d 249, aff'd 10 N.Y.2d 966, 224 N.Y.S.2d 283, 180 N.E.2d 63); Hartley ......
  • C. H. O. B. Associates Inc. v. Board of Assessors of Nassau County
    • United States
    • New York Supreme Court
    • 8 Julio 1964
    ...certain equalization rates; (2) court procedures in tax certiorari cases; (3) an expert's testimony in Matter of Mid-Island Shopping Plaza, Inc. v. Podeyn, 25 Misc.2d 972, 204 N.Y.S.2d 11, aff'd 14 A.D.2d 571, 218 N.Y.S.2d 249, aff'd 10 N.Y.2d 966, 224 N.Y.S.2d 283, 180 N.E.2d 63, relating ......
  • Senpike Mall Co. v. Assessor
    • United States
    • New York Supreme Court — Appellate Division
    • 4 Marzo 1988
    ...proceedings, the property must be valued without regard to its existing mortgage financing ( Matter of Mid-Island Shopping Plaza v. Podeyn, 25 Misc.2d 972, 989, 204 N.Y.S.2d 11, affd. 14 A.D.2d 571, 218 N.Y.S.2d 249, affd. 10 N.Y.2d 966, 224 N.Y.S.2d 283, 180 N.E.2d 63). Since the issue in ......
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