Union Pacific R. Co. v. Wyoming State Bd. of Equalization, 90-103

• Court: United States State Supreme Court of Wyoming
• Citation: 802 P.2d 856
• Docket Number: No. 90-103,90-103
• Parties: UNION PACIFIC RAILROAD COMPANY, Appellant (Petitioner), v. The WYOMING STATE BOARD OF EQUALIZATION and Ann Strand, Sweetwater County Assessor, Appellees (Respondents).
• Decision Date: 10 December 1990

Page 856

802 P.2d 856

UNION PACIFIC RAILROAD COMPANY, Appellant (Petitioner), v. The WYOMING STATE BOARD OF EQUALIZATION and Ann Strand, Sweetwater County Assessor, Appellees (Respondents).

No. 90-103.

Supreme Court of Wyoming.

Dec. 10, 1990.

James D. Douglass, Broomfield, Colorado, for appellant; argument by Mr. Douglass.

Joseph B. Meyer, Atty. Gen., and Michael L. Hubbard, Sr. Asst. Atty. Gen., for appellee State Bd. of Equalization; argument presented by Mr. Hubbard.

Before URBIGKIT, C.J., and THOMAS, CARDINE, MACY and GOLDEN, JJ.

CARDINE, Justice.

Union Pacific Railroad Company (Union Pacific) challenges the Sweetwater county assessor's (assessor) 1987 tax assessment of seventeen mobile homes. The Sweetwater County Board of Equalization found in favor of Union Pacific. The State Board of Equalization reversed, and the district court affirmed the state board. Union Pacific appeals the decision of the district court.

We affirm the decision of the district court.

Union Pacific raises a single issue on review:

"Whether the two intermediate reviewing tribunals, i.e., the State Board of Equalization and the district court, erroneously substituted their judgment for that of the trier of facts in the first instance, the Sweetwater County Board of Equalization."

Sometime before the 1987 tax assessment, Union Pacific purchased a number of mobile homes for track crew temporary living quarters. Seventeen of these mobile homes were situated in Sweetwater County. During April 1987, Union Pacific offered the homes for sale, advertised, and sent out invitations to bid to at least one hundred mobile home dealers. The homes were offered for sale individually. The sale was made to a single buyer who bought all seventeen mobile homes involved in this appeal.

The seventeen mobile homes were assessed by the Sweetwater county assessor in late 1987 as omitted property pursuant to W.S. 39-2-403(c), which provides:

"Property omitted from prior year tax lists discovered by the county assessor shall be added to the assessment roll and taxes computed and collected for the period the property was omitted not exceeding five (5) prior years or since the last change in ownership, whichever is less."

The assessor was unaware that the mobile homes had been sold by Union Pacific at the time of the assessment. She followed the state regulations for valuing mobile homes and valued the homes at 25% of their 1967 replacement cost.

The sale price of the homes differed drastically from the assessor's estimated fair value, as illustrated by the chart below:

                Tax                      Estimated Assessor's     Actual
                Acc't No.  Location           Fair Value        Sale Price
                17188      Riner               $19,139             $  2,000
                17189      Riner               $19,139             $  2,000
                17190      Creston Jct.        $19,583             $  2,000
                17191      Creston Jct.        $19,583             $  2,000
                17192      Creston Jct.        $20,017             $  3,100
                17193      Wamsutter           $19,139             $    500
                17194      Wamsutter           $19,583             $  2,000
                17195      Bitter Creek        $17,383             $    500
                17196      Bitter Creek        $17,817             $    500
                17197      Pt. of Rocks        $19,139             $    500
                17198      Pt. of Rocks        $15,739             $    500
                17199      Pt. of Rocks        $17,817             $    500
                17200      Pt. of Rocks        $17,817             $    500
                17201      Bryan               $16,939             $    500
                17202      Bryan               $16,939             $    500
                17203      West Vaco           $19,139             $    500
                17204      West Vaco           $19,139             $    500
                ----------
                

Union Pacific paid the tax due on the value assigned by the assessor but filed a protest with the Sweetwater County Board of Equalization. A hearing was held before the board, and both parties provided testimony and exhibits.

The county board, on October 5, 1988, issued "Findings of Fact, Conclusions of Law and Order" in which it held that the sale by Union Pacific was an arms-length, bona fide transaction, and that the sale price of the homes was their "fair value" for tax purposes. It ordered the assessor to adjust the taxable value to match the sale price of the units.

The county assessor timely appealed the county board's decision to the State Board of Equalization. The state board reviewed the evidence on file and briefs submitted by the parties and issued its findings, conclusions, and order on August 31, 1989. The state board concluded that the price received by Union Pacific in its sale of the mobile homes was not their "fair value" because the sale was not a "market place transaction" under Wyoming State Tax Commission/State Board of Equalization rules. The state board reversed the decision of the county board and remanded the case to the county board for reassessment, taking into account the actual condition of the homes and providing an adequate allowance for depreciation.

Union Pacific then petitioned the district court for judicial review of the state board's decision. The district court issued a decision letter on February 14, 1990, upholding the decision of the state board. The district court found that the question of "[w]hether the pricing decision of the market can be accepted as 'fair market value' " presented a question of law for which it was not required to accept the findings of the county board. The court found that the sale at issue was in the nature of a wholesale transaction, and that valuation should be determined by reference to the price to be paid by the ultimate consumer. It upheld the state board's remand of the case to the county board.

The scope of our review of agency decisions is limited to the extent specified in W.R.A.P. 12.09 and W.S. 16-3-114(c) (July 1990 Repl.). Wyoming Statute 16-3-114(c) states:

"(c) To the extent necessary to make a decision and when presented, the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action. In making the following determinations, the court shall review the whole record or those parts of it cited by a party and due account shall be taken of the rule of prejudicial error. The reviewing court shall:

"(i) Compel agency action unlawfully withheld or unreasonably delayed; and

"(ii) Hold unlawful and set aside agency action, findings and conclusions found to be:

"(A) Arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law;

"(B) Contrary to constitutional right, power, privilege or immunity;

"(C) In excess of statutory jurisdiction, authority or limitations or lacking statutory right;

"(D) Without observance of procedure required by law; or

"(E) Unsupported by substantial evidence in a case reviewed on the record of an agency hearing provided by statute."

In considering an appeal from a district court's review of agency action, we are not bound by, nor must we accord any special deference to, the district court's decisions on questions of law. Matter of North Laramie Land Co., 605 P.2d 367, 373 (Wyo.1980). The deference we accord to the fact finder's determination of fact belongs to the administrative agency, not the district court. Wyoming Public Service Comm'n v. Hopkins, 602 P.2d 374, 377 (Wyo.1979).

"[U]sing the same evidentiary materials and the same review standards as the district court, we conduct an independent inquiry into the matter, just as if it had proceeded directly to us from the agency." Southwest Wyoming Rehab. Center v. Employment Sec. Comm'n, 781 P.2d 918, 920 (Wyo.1989).

Since in this case the county board was the finder of the fact and the state board heard no additional testimony, we will treat the state board as an intermediate level of review and accord deference only to the county board's findings of fact. Thus, the primary focus of our review will be whether the county board's decision was lawful and supported by substantial evidence.

The Sweetwater county board found that it had jurisdiction over Union Pacific's protest and appeal; that the mobile homes were sold pursuant to an invitation to bid and purchased by one buyer; that they were assessed in late 1987 as omitted property; that the county assessor had followed state direction for valuing mobile homes at 25% of their 1967 fair market value; and that, at the time of the sale, the county assessor was unaware of the sale price or the nature of the sale transaction. It further found that the value of the mobile homes as assessed far exceeded the value for which they were sold; that the homes had not been inspected by the county assessor; and that the deputy county assessor, Marvin Applequist, had admitted that the sale met all of the elements of a fair value sale. Finally, the board found that the information and data regarding the sale were within the definition of information or data that the county assessor should consider in determining fair value.

We find these material facts are supported by substantial evidence and will not seek to substitute our judgment for that of the agency. It is the agency's conclusions of law which are primarily in dispute in this appeal.

The board made the following conclusions of law in this case:

"1. That the sale made by the Union Pacific Corporation to Ponderosa Village of Cheyenne, Wyoming, was an arms-length, bona fide commercial transaction.

"2. That the terms of the above-referenced sale did and do constitute the best information available to the County Assessor with respect to value.

"3. That the amount received by Union Pacific Corporation with respect to said mobile homes is the fair value of said mobile homes in accordance with the rules and regulations of the Wyoming State Tax Commission, Chapter 22, Section 4(a)."

Proper analysis of the board's conclusions requires that we clarify a...