Safran Printing Co. v. City of Detroit, Wayne County, Docket No. 77-2799

• Decision Date: 05 February 1979
• Docket Number: Docket No. 77-2799,77-2800-1
• Citation: 88 Mich.App. 376,276 N.W.2d 602
• Parties: SAFRAN PRINTING COMPANY, Plaintiff-Appellant, v. CITY OF DETROIT, WAYNE COUNTY, Defendant-Appellee. 88 Mich.App. 376, 276 N.W.2d 602
• Court: Court of Appeal of Michigan — District of US

Page 602

276 N.W.2d 602

SAFRAN PRINTING COMPANY, Plaintiff-Appellant, v. CITY OF DETROIT, WAYNE COUNTY, Defendant-Appellee.

Docket No. 77-2799, 77-2800-1.

88 Mich.App. 376, 276 N.W.2d 602

Court of Appeals of Michigan.

Feb. 5, 1979.

Released for Publication March 29, 1979.

[88 MICHAPP 378] Honigman, Miller, Schwartz & Cohn by Charles H. Tobias, Michael B. Shapiro, Detroit, for plaintiff-appellant.

Carl Rashid, Jr., Detroit, for defendant-appellee.

Before KELLY, P. J., and J. H. GILLIS and CAVANAGH, JJ.

J. H. GILLIS, Judge.

Plaintiff, Safran Printing Company, appeals from a split decision of the Michigan Tax Tribunal fixing the valuation and assessment of two pieces of property in the City of Detroit, hereinafter referred to as the "main plant" and the "associated property".

The main plant consists of a 7.41-acre parcel of land with a 191,000-square-foot structure owned by Safran and used by it as a printing plant. The valuation and assessment of this property is in dispute for the years 1971 through 1976. The tribunal majority found the true cash value of this property to be $767,770. Appellant contends it should be $368,000.

The associated property consists of a warehouse and two-story office building on 1.95 acres. This was purchased by Safran in 1973 for $130,000. The valuation and assessment of this property is in dispute for the years 1973 through 1976. The majority found the true cash value to be $208,000. Appellant contends it should be $135,000.

In a well written dissent, tribunal member McDonald concluded that appellant's figures correctly reflected the true cash value of the parcels in question. We find the dissenting opinion accurately states the law on this subject and adopt its reasoning.

[88 MICHAPP 379] Appellate review of decisions of the Tax Tribunal is limited by Const.1963, art. 6, § 28, which provides:

"In the absence of fraud, error of law or the adoption of wrong principles, no appeal may be taken to any court from any final agency provided for the administration of property tax laws from any decision relating to valuation or allocation."

Safran contends the tribunal majority used an improper standard to determine the true cash value of the property. For purposes of taxation, property is to be assessed according to its true cash value. Const.1963, art. 9, § 3. Ramblewood Associates v. Wyoming, 82 Mich.App. 342, 266 N.W.2d 817 (1978). The Legislature has defined "cash value" as:

"(T)he usual selling price at the place where the property to which the term is applied shall be at the time of assessment, being the price which could be obtained for the property at private sale, and not at forced or auction sale. * * * In determining the value the assessor shall also consider the advantages and disadvantages of location, quality of soil, zoning, existing use, present economic income of structures, including farm structures and present economic income of land when the land is being farmed or otherwise put to income producing use, quantity and value of standing timber, water power and privileges, mines, minerals, quarries, or other valuable deposits known to be available therein and their value." M.C.L. § 211.27; M.S.A. § 7.27. (Emphasis supplied.)

The Supreme Court has recognized that under this definition the concept of "true cash value" is synonymous with "fair market value". CAF Investment Co. v. State Tax Comm., 392 Mich. 442, 450, 221 N.W.2d 588 (1974).

[88 MICHAPP 380] There are a number of methods generally accepted for calculating true cash value. Any method which is recognized as accurate and is reasonably related to fair market valuation is an acceptable indicator of true cash value. Consumers Power Co. v. Big Prairie Twp., 81 Mich.App. 120, 130, 265 N.W.2d 182 (1978); Ramblewood Associates v. Wyoming, supra.

In assessing the property under consideration the majority stated the following:

"The Tribunal in making its analysis of the proper true cash value of the main parcel, disagrees with the Petitioner's approach to valuation in that the Petitioner relies on a market value for the property based on a future or alternative use while ignoring its present existing use as an industrial printing plant which we believe to be the highest and best use.

"The legislative definition of true cash value is not exclusive or inclusive. The tax laws must be read as a whole. 'The usual selling price' Or market value of property is merely a guide for the determination of property valuations. Moran v. Grosse Pointe Twp., 317 Mich. 248, 26 N.W.2d 763 (1947). As stated, in M.C.L. § 211.27; M.S.A. § 7.27, when determining value the assessor shall also consider the existing use of the property in question. However, no single factor is intended to be inclusive as to value. Basically, all related factors are to be considered. While it may seem that a sale definitely fixes market price so as to almost indisputably determine true cash value, this is not necessarily the case, particularly if the property is unique, as the subject is, and if there have been few sales in like property. Fisher New Center v. State Tax Comm., 381 Mich. 713, 167 N.W.2d 263 (1969)." (Emphasis supplied.)

The foregoing excerpt indicates the tribunal applied an improper standard to determine the [88 MICHAPP 381] value of the property in question. "Fair market value" Is the standard and not merely a guideline.

In holding otherwise, the tribunal misconstrued the Supreme Court's opinion in Moran v. Grosse Pointe Twp., supra. That case indicates that a single sale is not conclusive of true cash value. The entire paragraph, from which the tribunal took a single clause, reads as follows:

"The words 'cash value' as defined by 1 Comp.Laws 1929, § 3415 Stat.Ann. § 7.27, is the usual selling price that could be obtained for it at the time of assessment, but not the price obtainable at a forced or auction sale. As stated in Twenty-Two Charlotte, Inc. v. City of Detroit, 294 Mich. 275, 283, 293 N.W. 647, at page...