Thoma v. Vill. of Slinger

• Decision Date: 10 May 2018
• Docket Number: No. 2015AP1970 & 2016AP2528,2015AP1970 & 2016AP2528
• Citation: 2018 WI 45,381 Wis.2d 311,912 N.W.2d 56
• Parties: Donald J. THOMA and Polk Properties LLC, Petitioners-Appellants-Petitioners, v. VILLAGE OF SLINGER, Respondent-Respondent.
• Court: Wisconsin Supreme Court

381 Wis.2d 311

912 N.W.2d 56

2018 WI 45

Donald J. THOMA and Polk Properties LLC, Petitioners-Appellants-Petitioners,

v.VILLAGE OF SLINGER, Respondent-Respondent.

No. 2015AP1970 & 2016AP2528

Supreme Court of Wisconsin.

Oral Argument: February 21, 2018

Opinion Filed: May 10, 2018

For the petitioners-appellants-petitioners, there were briefs filed by Erik S. Olsen, Andrew D. Weininger, and Eminent Domain Services, LLC, Madison. There was an oral argument by Erik S. Olsen.

For the respondent-respondent, there was a brief filed by Dustin T. Woehl, Thomas A. Cabush, and Kasdorf Lewis & Swietlik, SC, Milwaukee. There was an oral argument by Thomas A. Cabush.

There was an amicus curiae brief filed on behalf of Wisconsin Farm Bureau Federation by H. Dale Peterson, John J. Laubmeier, and Stroud, Willink, & Howard, LLC, Madison. There was an oral argument by H. Dale Peterson.

There was an amicus curiae brief filed on behalf of the Wisconsin REALTORS Association, Wisconsin Builders Association, and NAIOP-WI by Thomas D. Larson and Wisconsin REALTORS Association, Madison.

REBECCA GRASSL BRADLEY, J.

¶ 1 We accepted review in these cases¹ to decide whether an injunction prohibiting agricultural use of a residentially-zoned property controls the property's tax assessment classification. As it turns out, all parties agree that the classification of real property for tax purposes is based on the actual use of the property, and that an injunction obtained based on a restrictive covenant does not control tax assessment classification. This is in fact the law in Wisconsin. See Wis. Stat. § 70.32(2)(a) (2013–14).²

¶ 2 What remains to be determined in this consolidated appeal is: (1) whether Donald J. Thoma and Polk Properties LLC (Thoma) presented sufficient evidence to the Village of Slinger Board of Review to overturn the 2014 tax assessment, and (2) whether the circuit court erroneously exercised its discretion when it denied Thoma's Wis. Stat. § 806.07(1)(h) motion asking the circuit court to vacate its original order affirming the Board's decision and remand to the Board for a new hearing. Because the record before the Board contains no evidence that Thoma used the property agriculturally within the meaning of Wisconsin tax law, we hold the Board's decision upholding the tax assessment was lawful, supported by a reasonable view of the evidence, and therefore cannot be disturbed. We further hold that the circuit court did not erroneously exercise its discretion when it denied Thoma's request to vacate the original order. Accordingly, we affirm the decision of the court of appeals in 2015AP1970, and we affirm the order of the circuit court in 2016AP2528.

I. BACKGROUND

¶ 3 This case centers on Thoma's challenge to the Village of Slinger's 2014 property tax assessment for property he purchased in 2004 and has attempted to develop into a residential subdivision known as Pleasant Farm Estates. Before Thoma purchased the land, it operated as a farm and received an agricultural classification for tax assessment purposes. The Village of Slinger continued to classify Thoma's property as agricultural until the 2014 assessment.

¶ 4 In attempting to develop Pleasant Farm Estates, Thoma worked with the Village of Slinger to rezone the area to residential so individual lots could be sold for construction of single family homes. Other lots were intended for construction of condominiums. Thoma and the Village of Slinger entered into a Developer's Agreement, which set forth three phases of development. The Agreement also contained restrictive covenants, one of which prohibited Thoma from using the land for agriculture—Thoma's use had to be residential.³ Only two lots were actually sold and the property remains mostly vacant land. The vacant land has ground cover, which is maintained by regular mowing.

¶ 5 In 2011, the Village of Slinger filed suit against Thoma to enforce the restrictive covenant and in 2012 successfully obtained an injunction prohibiting Thoma from using the land for agricultural purposes. See Vill. of Slinger v. Polk Prop. LLC, Washington Cty. Circuit Ct. Case No. 2011CV1224. The injunction lawsuit occurred contemporaneously with Thoma's tax assessment challenge, and Thoma's appeal in the injunction lawsuit is currently pending in the court of appeals. See Vill. of Slinger v. Polk Prop. LLC, 2017AP2244 (record transmitted to court of appeals on Feb. 27, 2018).

¶ 6 In order to contest his 2014 tax assessment, Thoma and his counsel appeared before the Village of Slinger Board of Review for a hearing in June 2014. Three witnesses were sworn to testify: Thoma; his counsel; and the Village of Slinger's assessor, Michael Grota. Thoma testified that he thought the property should be classified as agricultural because that was the classification it carried the prior year. Thoma contended the 62 acres had zero value. Thoma urged the Board to apply the agricultural classification because nothing had changed on the property from the previous year, he maintained ground cover on the vacant land, and he was having trouble selling the lots. He shared with the Board vague information about a few other residential development projects that were also struggling and claimed that market value for these projects had dropped substantially. Thoma did not present any documentation to support these statements, and he offered no testimony or evidence that the property was being used for farming or that he was harvesting crops for food or fiber. Although Thoma left the hearing early to attend a funeral, his counsel remained and reaffirmed several times that Thoma was not farming the property; rather, he was "just maintaining the ground cover," as well as "maintain[ing] the property, to try to sell the lots," and "keeping the ground cover maintained and—and making sure that they're appropriate for—for sale ... it's not farming, it's just kind of maintaining the—the property."

¶ 7 Assessor Grota testified that he changed the use classification from agricultural to residential because it was his understanding that the injunction prohibiting any agricultural use on the property required the property to be classified as residential for tax assessment purposes. Grota said his opinion was based on his conversation with Patrick Chaneske, "the Regional Supervisor for the Department of Revenue, in charge of Equalization in Southeastern Wisconsin." Grota submitted comparable sales of similar properties to support the numbers he used to reach his assessment.

¶ 8 The Board's attorney advised the Board members that maintaining ground cover was not sufficient to obtain an agricultural use classification: "Well, let me clarify. If it is simply maintaining ground cover, it's not an ag[ricutural] use." Ultimately, the Board voted 2-1 to uphold the assessor's assessment because Thoma failed to submit sufficient evidence to prove the assessor's number (or classification) was wrong: "There's a motion on the table to uphold the assessor's assessment of the property values. Since the objector did not provide adequate evidence in rebuttal and we will now take a roll call vote." Two of the Board's members voted affirmatively. The third Board member voted against the motion because she believed, based on her personal observation, that Thoma was using the property for what she believed qualified as agricultural use—"I've seen the guy on the tractor with the bailer."⁴

¶ 9 Thoma petitioned for a writ of certiorari pursuant to Wis. Stat. § 70.47(13), and the circuit court affirmed the decision of the Board in July 2015.⁵ Thoma appealed to the court of appeals, which also affirmed the decision of the Board. Thoma v. Village of Slinger, No. 2015AP1970, unpublished slip op., 373 Wis.2d 766, 2017 WL 218275 (Wis. Ct. App. Jan. 18, 2017). In October 2016, while Thoma's appeal was pending in 2015AP1970, he filed a motion in the circuit court to vacate the circuit court's first decision affirming the Board, claiming that Assessor Grota gave faulty testimony at the Board of Review Hearing. Specifically, Thoma claimed that Grota misrepresented to the Board that the Wisconsin Department of Revenue required him to classify Thoma's property as residential because of the injunction. Thoma asserted that the Board's decision erroneously relied on Grota's faulty testimony; therefore, Thoma argued, the circuit court should vacate its original order affirming the Board and send it back for a new Board hearing. The circuit court entered an order denying Thoma's motion to vacate. Thoma filed a new appeal, 2016AP2528, and petitioned this court to bypass the court of appeals so that review of this circuit court order could be consolidated with review of the court of appeals decision. We granted Thoma's bypass petition and consolidated these cases.⁶

II. STANDARD OF REVIEW

¶ 10 In certiorari review under Wis. Stat. § 70.47(13), we review the Board of Review's decision, not the decisions of the circuit court or court of appeals, although we benefit from their analyses. See Sausen v. Town of Black Creek Bd. of Rev., 2014 WI 9, ¶¶ 4–5, 352 Wis. 2d 576, 843 N.W.2d 39. Review is limited to "the record made before the board of review." Saddle Ridge Corp. v. Bd. of Rev., 2010 WI 47, ¶ 36, 325 Wis. 2d 29, 784 N.W.2d 527. Our review is confined to deciding "whether the board's actions were: (1) within its jurisdiction; (2) according to law; (3) arbitrary, oppressive, or unreasonable and represented its will and not its judgment; and (4) supported by evidence such that the board might reasonably make the order or determination in question." Sausen, 352 Wis. 2d 576, ¶ 6, 843 N.W.2d 39 (footnote omitted). The taxpayer challenging an assessment based on improper classification bears the burden of proving the classification is erroneous. Id., ¶ 10. If the taxpayer does not meet his burden of proof and "the board's determination to maintain the assessment is supported by a reasonable view of the evidence," we will affirm the Board's...