Mortenson v. Stanley County

• Decision Date: 11 March 1981
• Docket Number: No. 12933,12933
• Parties: Clarence MORTENSON and Marlin Scarborough, Plaintiffs and Appellants, v. STANLEY COUNTY, Stanley County Board of Equalization and South Dakota Board ofEqualization, Defendants and Appellees.
• Court: South Dakota Supreme Court

Page 107

303 N.W.2d 107

Clarence MORTENSON and Marlin Scarborough, Plaintiffs and Appellants, v. STANLEY COUNTY, Stanley County Board of Equalization and South Dakota Board ofEqualization, Defendants and Appellees.

No. 12933.

Supreme Court of South Dakota.

Argued Sept. 8, 1980.

Decided March 11, 1981.

Harold H. Deering, Jr., of May, Adam, Gerdes & Thompson, Pierre, for plaintiffs and appellants.

Douglas E. Kludt, Stanley County Deputy State's Atty., Fort Pierre, for defendants and appellees; Bernard E. Duffy, Stanley County State's Atty., Fort Pierre, on the brief.

WOLLMAN, Chief Justice.

Plaintiffs, the owners of certain agricultural property in Stanley County, made timely objection to the 1977 assessments on their land. The Stanley County Board of Equalization refused to make any adjustments in the assessed valuations, however. ¹

Plaintiffs appealed to the State Board of Equalization, which reduced the valuation of plaintiffs' land by five percent because of lack of rainfall. The State Board refused any further relief, however, and plaintiffs appealed to the circuit court pursuant to SDCL 10-11-43. After a trial de novo, the circuit court entered judgment denying plaintiffs relief. This appeal followed. We affirm.

Plaintiffs contend that the county assessor failed to consider or improperly considered several factors in determining the true and full value of their land. These factors include: (1) the distance of the property from the market place; (2) the presence of numerous wet spots on the property; (3) the irregular shape of certain tracts valued as cropland; (4) the isolated nature of certain tracts valued according to the crop rating; (5) the potential for erosion on certain lands rated as cropland; and (6) the lower yield potential of certain sandy soils unique to the alluvial character of plaintiffs' soil. Plaintiffs also contend that the assessment is discriminatory because of the unique nature of some of their land and that their property is assessed at more than its actual value because of the actual use to which the property is being put.

All property is to be assessed at its true and full value in money. ² SDCL 10-6-33. The South Dakota Legislature has specifically enumerated the factors to be used in determining the value of agricultural land. SDCL 10-6-33.1 provides:

In fixing the true and full value in money of property, under the provisions of § 10-6-33, the value of agricultural land as defined by § 10-6-31, and which has been used primarily for agriculture use for at least five successive years immediately preceding the tax year for which assessment is to be made shall be based on consideration of the following factors:

(1) The capacity of the land to produce agricultural products as defined in § 10-6-33.2; ³

(2) Soil, terrain, and topographical condition of property;

(3) The present market value of said property as agricultural land as determined by the factors contained in subdivisions (1), (2), (4) and (5) of this section;

(4) The character of the area of place in which said property is located; and

(5) Such other agricultural factors as may from time to time become applicable.

We have held that in determining true value comparable sales of agricultural lands used for agricultural purposes may be considered. County of Butte v. South Dakota State Board of Equalization, 263 N.W.2d 140 (S.D.1978); Hot Springs Ind. School Dist. No. 10 v. Fall River Landowners, 262 N.W.2d 33 (S.D.1978).

Roger Fuller, Director of Equalization and assessor for Stanley County, used comparable sales and a soil survey in determining the assessed valuation of plaintiffs' land. Fuller and a South Dakota Department of Revenue employee gathered bare land sales in Stanley County for a three-year period. They then eliminated any sales that were not comparable, such as a sale that included a lease on other land. There were approximately fifteen different reasons why a particular sale might be eliminated. After eliminating the sales that were not comparable, they arrived at a median figure that they considered to be a fair market value figure for an average acre. At that point Fuller met with assessors of other counties to compare the median sales prices for equalization purposes. After reducing the $100 median sales figure to $83 for equalization purposes, the latter figure was submitted to the State Department of Revenue, which valued each type of land in Stanley County according to its rating.

These ratings are based on a soil survey that was conducted by the Soil Conservation Service. This soil survey included a systematic examination of the different soils throughout the county as well as analysis of the appropriate yield data, and the description, classification and mapping of these soils. The Soil Conservation Service then utilized a land capability classification system. Land suitable for crops would also be given a cropland rating whereas land not suitable for crops would, in Stanley County, be given a rangeland rating.

Fuller then utilized Department of Revenue figures stating how much each type of land was worth and applied those figures to the descriptions and soil survey maps of every taxable acre in Stanley County.

I

The first issue raised by plaintiffs is that their evidence regarding the factors reducing the value of their land was sufficient to overcome the presumption that the Stanley County Director of Equalization's valuation was correct.

On appeal, plaintiffs originally conceded that there was a presumption that the Director of Equalization's valuation was correct. In their reply brief, however, plaintiffs contend that the presumption is not applicable where the Director of Equalization has not actually viewed the property assessed and valued but rather relies on values given to him by others, citing In re Jepsen's Appeal, 76 S.D. 421, 80 N.W.2d 76 (1956). Although the Director of Equalization did not actually view the property in question until after appeal was taken to the Stanley County Board of Equalization, Jepsen's Appeal is distinguishable and is not controlling here. In Jepsen's Appeal there was no qualified assessor, and those purporting to act as assessor never viewed the property but merely accepted the appraisal of a private consulting company. In the case at bar plaintiffs do not contend that the Director of Equalization was not a qualified assessor or that he merely accepted the valuations of a private consulting company.

Accordingly, there is a presumption that the Stanley County Director of Equalization's valuation was correct. Knodel v. Bd. of County Com'rs, 269 N.W.2d 386 (S.D.1978); Yadco, Inc. v. Yankton County, 89 S.D. 651, 237 N.W.2d 665 (1975). Moreover, our scope of review of a trial court's decision in a trial de novo of a tax assessment matter is to determine whether the trial court's findings were clearly erroneous. Knodel v. Bd. of County Com'rs, supra; Willow, Inc. v. Yankton County, 89 S.D. 643, 237 N.W.2d 660 (1975); Yadco, Inc. v. Yankton County, supra.

Before addressing the specific factors enumerated by plaintiffs, we note that although plaintiffs' expert testified regarding the factors to be used in valuation of agricultural land, he gave no opinion regarding the full and true value of plaintiffs' land, nor did he ever disagree or agree with the Director of Equalization's valuation. Plaintiffs were qualified to testify regarding the assessments involved, but the weight to be accorded such testimony is for the trier of fact. Hannahs v. Noah, 83 S.D. 296, 158 N.W.2d 678 (1968); Rau v. Fritz, 81 S.D. 311, 134 N.W.2d 773 (1965).

Plaintiffs seek a reduction in their overall assessed valuation because of the distance of their respective ranches from the market. Plaintiff Mortenson seeks a ten percent reduction in valuation while plaintiff Scarborough seeks a nine percent reduction in valuation. Both plaintiffs testified that Fort Pierre-Pierre, which is sixty-five and seventy miles from their respective ranches, is their predominant market, trading center and social center. They testified that this distance increases marketing and production costs. Plaintiffs' expert testified that distance detracts from market value but that there is no set rate of reduction.

The circuit court agreed with plaintiffs that the distance to the market place caused them more expense than landowners living next to town, but found that plaintiffs had not supplied any evidence from which the court could hold that the present market value of plaintiffs' property was altered by such distance.

This Court has noted that the location of property is an element bearing upon the...