Limited sales data and lack of reasonable adjustments does not doom plaintiff’s appeal
In this appeal, Belview Crossing v. Lopatcong Twp., the court considered a challenge to the assessments on 32 vacant building lots.
The Township of Lopatcong did not submit any affirmative proofs, but instead, it rested on the assessment, meaning that it relied on the doctrine under the law that all assessments are presumed to be valid. Under this doctrine, known as the “presumption of validity,” the burden is on the taxpayer to present sufficient evidence to establish the existence of a debatable question as to the correctness of the assessment. Thereafter, based upon those proofs as well as any offered by the municipality, the court may make an independent determination of value.
In this case, the taxpayer’s expert prepared an appraisal report in which he utilized the sales comparison approach to value the lots. In doing so, he relied on four sales, two of which the court found to be unreliable. The court did find that the two other sales relied upon by the appraiser presented a reasonable basis by which the court could determine value, notwithstanding that plaintiff’s appraiser failed to make reasonable adjustments to one of those sales. Placing “the most emphasis” on a single sale relied upon by plaintiff’s appraiser, the court found that the 2010 and 2011 assessed values exceed the total true value of the subject property and revised the assessments accordingly.
A copy of this unpublished decision may be found here.
What was most interesting in this case is that it involved a cumulative assessment of $6,536,500 and the Township not only rejected a settlement offer, but then proceeded to trial resting on the assessment instead of offering its own expert report to support the assessment or for a higher value than that proffered by the plaintiff.
The opinion, of course, does not explain the details of the proposed settlement or why the Township chose to rest on the assessment. Ultimately, the cost to the Township will be $90,000 in refunds for the 2010-2011 tax years and presumably another $110,000 for 2012-and 2013 assuming there is an application of the Freeze Act. Also, the taxpayer is entitled to statutory interest on all refunds.
This case should serve as a cautionary tale to other municipalities which take a hard-line on negotiation but not prepared to defend their assessments. As painful as a settlement may be, an unfavorable judgment after trial may be for more costly.
Related blog posts:
Comparable Sales From Neighboring Town Not Persuasive Evidence
Taxpayer Fails to Overcome Presumption of Correctness
Appraiser’s Subjective Adjustments Rejected; Owner Loses Appeal
Taxpayer Clears One Hurdle But Trips on Another
Apartment Complex Wins Assessment Reductions at Trial
