Stamford Apartments Co. v. City of Stamford

• Decision Date: 26 May 1987
• Docket Number: No. 12991,12991
• Citation: 525 A.2d 1327,203 Conn. 586
• Court: Connecticut Supreme Court
• Parties: STAMFORD APARTMENTS COMPANY v. CITY OF STAMFORD.

Page 1327

525 A.2d 1327

203 Conn. 586

STAMFORD APARTMENTS COMPANY v. CITY OF STAMFORD.

No. 12991.

Supreme Court of Connecticut.

Argued March 31, 1987.

Decided May 26, 1987.

Alice L. Perry, Asst. Corp. Counsel, Stamford, with whom, on the brief, was Michael Gene Clear, Corp. Counsel, for appellant (defendant).

Lawrence J. Merly, Bridgeport, with whom were Joseph J. Tooher, Stamford, and, on the brief, Dominick M. Uva, Law Student, for appellee (plaintiff).

Before PETERS, C.J., and SHEA, CALLAHAN, BORDEN and STOUGHTON, JJ.

BORDEN, Associate Justice.

The defendant, the city of Stamford, appeals from the judgment of a state trial referee, acting as the trial court, reducing the assessed value of the plaintiff's property for the assessment dates October 1, 1981, through October 1, 1985. The defendant claims that the trial court erred: (1) in refusing to accord the defendant's valuation a presumption of correctness, and by not placing the burden of proof on the plaintiff as to the value of the property; (2) in placing the burden of proof on the defendant as to a claim of discriminatory assessment; (3) in placing the burden of proof on the defendant as to the issues of the highest and best use of the property, and of the most appropriate valuation method; (4) in disregarding the defendant's claimed overwhelming evidence as to fair market value; and (5) in disregarding a presumption in favor of the method of valuation used by the defendant's assessor, and in finding that the comparable sales method of valuation was inappropriate. We find no error.

The plaintiff appealed to the trial court, pursuant to General Statutes § 12-118, from the action of the board of tax review of the city of Stamford declining to reduce the valuation of the plaintiff's property from the valuation placed on it by the city tax assessor on the assessment list of October 1, 1981. By amendment to its complaint, the plaintiff incorporated the assessor's subsequent identical valuations of the property on the lists of October 1, 1982, through October 1, 1985. The plaintiff claimed that the valuations were grossly excessive and not in accordance with the applicable percentage of the property's true and actual value.

The trial court, hearing the case de novo; Schlumberger Technology Corporation v. Dubno, 202 Conn. 412, 421, 521 A.2d 569 (1987); Xerox Corporation v. Board of Tax Review, 175 Conn. 301, 303, 397 A.2d 1367 (1978); found the following facts. The plaintiff's property consists of six five-story apartment buildings containing 330 apartments and 19,000 square feet of professional office space. It is located in a residential multi-family use zone. It has been used as rental apartment buildings continually from the date of construction through the date of the trial. The court further found that the highest and best use of the property was its actual use, namely, as rental apartments and offices. The court also found that the income capitalization approach, based on actual income, was the proper method of appraisal. The court accepted the opinion of the plaintiff's appraiser that the fair market value of the property was $7,500,000, yielding an assessed value, at 70 percent of fair market value, of $5,250,000.

The court rejected the defendant's claim that the highest and best use of the property was conversion to residential and office condominiums, and that it should be appraised on the basis of that use. The court also rejected the defendant's claim that the comparable sales method was the most appropriate method of valuation, and that based on this method, the fair market value of the property was $12,429,014, yielding an assessed value of $8,700,310. The court rejected an alternate appraisal offered by the defendant based on the capitalization of income approach.

The court rendered judgment sustaining the plaintiff's appeal and fixing the assessed value of the property at $5,525,000. After the court further articulated its decision in response to the defendant's request, this appeal followed.

I

The defendant first claims that the court erred by not according to the defendant a presumption that its valuation was valid, and by not placing the burden of proof on the plaintiff. This claim is without merit.

It is true that when a property owner challenges the assessor's valuation, "the plaintiffs' burden ... is a difficult one. '[P]roper deference must be given to the judgment and experience of assessors.' Connecticut Coke Co. v. New Haven, 169 Conn. 663, 668, 364 A.2d 178 (1975). 'The law contemplates that a wide discretion is to be accorded to assessors, and unless their action is discriminatory or so unreasonable that property is substantially overvalued and thus injustice and illegality result, their opinion and judgment should control in the determination of value for taxation purposes.' Federated Department Stores, Inc. v. Board of Tax Review, 162 Conn. 77, 86, 291 A.2d 715 (1971), quoting Burritt Mutual Savings Bank v. New Britain, 146 Conn. 669, 675, 154 A.2d 608 (1959)." (Emphasis added.) Uniroyal, Inc. v. Board of Tax Review, 182 Conn. 619, 633-34 n. 8, 438 A.2d 782 (1981). While we have recognized that proper deference should be accorded to the assessor's valuation, we have never characterized such deference as a presumption in favor of the validity of the assessment which it is the plaintiff's burden to rebut.

In this case, moreover, no deference to the assessor's valuation was warranted. The record indicates that the appraiser employed by the defendant's assessor for purposes of the 1981 valuation arrived at that valuation by a cost of replacement method. Neither the assessor, nor the appraiser who valued the property in 1981 on the cost of replacement method testified at the trial. The defendant's appraiser who did testify at the trial, however, agreed with the plaintiff's appraiser that the cost of replacement method was inappropriate. He arrived at a valuation comparable to that of the assessor in 1981 by an entirely different valuation route, namely, condominium conversion as the highest and best use coupled with comparable sales of other converted apartment buildings.

There is nothing in the trial court's memorandum of decision to suggest that it used an erroneous standard in evaluating the evidence and finding facts. By its finding as to the fair market value of the property, it implicitly found that the defendant had "substantially overvalued" the plaintiff's property and thus that "injustice and illegality result[ed]...." Nor is there anything in the memorandum of decision to suggest that the court relieved the plaintiff of its burden to establish that the defendant's valuation was excessive, or that the court cast a burden of proof on the defendant. ¹

II

The defendant next argues that the court erred by placing the burden on the defendant to disprove the plaintiff's claim of inequality of assessment, or discriminatory assessment, and by considering that claim as part of the fair market value issue. This claim is based on a gross misreading of the memorandum of decision.

The defendant rests this argument on an isolated sentence in the memorandum of decision, ² taken out of context, and on the court's response to the defendant's motion for articulation to explain that one sentence and its relation to whether the plaintiff or the defendant had the burden of proof. ³ Reading the sentence in its context and together with the court's articulation makes it quite clear that the court was discussing its reasons for rejecting the opinion of the defendant's appraiser that the highest and best use of the property was conversion to condominiums. The plaintiff concedes that it did not make any claim of discriminatory assessment. The court did not inject any such issue into the case, as the defendant implies, and did not impose any such burden of proof on the defendant.

III

The defendant's next claim is that the court placed the burden on the defendant to prove the fair market value of the property, including the burden of establishing the highest and best use of the property. This claim has two aspects. The first aspect simply seeks to persuade us that the court should have accepted the testimony of the defendant's appraiser rather than that of the plaintiff's appraiser as to the fair market value of the property. This argument is misplaced. The question of evaluating the credibility of the appraisers is for the trial court, not this court. Pandolphe's Auto Parts, Inc. v. Manchester, 181 Conn. 217, 220-21, 435 A.2d 24 (1980); see also Uniroyal, Inc. v. Board of Tax Review, 174 Conn. 380, 387, 389 A.2d 734 (1978).

In the second aspect of this claim, the defendant asserts that the trial court improperly placed the burden of proof as to the highest and best use of the property on the defendant. This claim rests on another misreading of the memorandum of decision. At trial, it was the plaintiff's position that the highest and best use of the property was its actual use as apartment buildings with office space. It was ...