Paul F. Rodhouse, Jr. and Cheri Rodhouse v. Board of Assessors of the Town of Hinsdale (May 14, 2015)

COMMONWEALTH OF MASSACHUSETTS

APPELLATE TAX BOARD



PAUL F. RODHOUSE, Jr. and	v.	   BOARD OF ASSESSORS OF
CHERI RODHOUSE					   THE TOWN OF HINSDALE

Docket No. F320548				   Promulgated:									   May 14, 2015


	This is an appeal under the formal procedure pursuant to G.L. c. 58A, § 7 and G.L. c. 59, §§ 64 and 65, from the refusal of the Board of Assessors of the Town of Hinsdale (the "appellee" or the "assessors") to abate a tax on a certain improved parcel of real estate located at 481 Maple Street in the Town of Hinsdale (the "subject property") owned by and assessed to Paul F. Rodhouse, Jr. and Cheri Rodhouse (the "appellants") under G.L. c. 59, §§ 11 and 38, for fiscal year 2013 (the "fiscal year at issue").  
	Commissioner Chmielinski (the "Presiding Commissioner") heard this appeal under G.L. c. 58A, § 1A and 831 CMR 1.20 and issued a single-member decision for the appellee.      
	These findings of fact and report are made pursuant to a request by the appellants under G.L. c. 58A, § 13 and 831 CMR 1.32.  

 
	Cheri Rodhouse, pro se, for the appellants.

	Karen Tonelli, Assistant Assessor, for the appellee.



FINDINGS OF FACT AND REPORT
Introduction
	The appellants' case-in-chief consisted of Cheri Rodhouse's testimony coupled with the introduction of one primary exhibit which contained a description of the subject property and its recent improvements, a narrative of the appellants' contentions, a copy of the subject property's and certain purported comparable-sale properties' property record cards, an analysis of some purportedly comparable-sale properties, summaries of the actual rents from the subject property over several years, copies of some lease agreements, copies of certain receipts, and an appraisal for a credit union valuing the subject property as of April 21, 2011 for a refinance.  In defense of the assessment, as abated, the assessors offered the testimony of Hinsdale's Assistant Assessor, Karen Tonelli, copies of the required jurisdictional documents, a copy of the subject property's property record card, and a comparable-sales analysis.  
On the basis of the testimony of Ms. Rodhouse and Ms. Tonelli and the exhibits admitted into evidence, the Presiding Commissioner made the following findings of fact.
	On January 1, 2012, the valuation and assessment date for the fiscal year at issue, the appellants were the assessed owners of the subject property.  For assessment purposes, the subject property is identified on assessors' map 406 as lot 28.  At all relevant times, the subject property was comprised of an approximately 0.590-acre parcel which was improved with a 2,656-square-foot, two-story, ten-room, brick, Colonial-style home, built in 1825.  The dwelling, a converted church, contained two living units, each with a kitchen, living area, two or three bedrooms and a full bathroom.  The subject property also had a 1,200-square-foot unfinished basement and a two-car detached garage.
For the fiscal year at issue, the assessors originally valued the subject property at $267,800 and assessed a tax thereon, at the rate of $12.22 per thousand, in the amount of $3,272.52.  In response to the appellants' Application for Abatement, the assessors lowered the value of the subject property by $28,700 to $239,100 and abated the real estate tax by $350.71.  

Jurisdiction
On or about December 18, 2012, Hinsdale's Collector of Taxes sent out the town's actual real estate tax notices for fiscal year 2013.  In accordance with G.L. c. 59,      § 57, the appellants timely paid the tax assessed on the subject property without incurring interest.  On January 15, 2013, in accordance with G.L. c. 59, § 59, the appellants timely filed an Application for Abatement with the assessors.  On March 19, 2013, the assessors granted the appellants a partial abatement by lowering the value of the subject property by $28,700 to $239,100 and abating the real estate tax by $350.71.  Not satisfied with this abatement, on May 10, 2013, in accordance with G.L. c. 59, §§ 64 and 65, the appellants seasonably filed a Statement Under Informal Procedure with the Appellate Tax Board (the "Board").  In accordance with G.L. c. 58A, § 7A, the assessors timely elected to transfer the appeal to the Board's formal procedure.  On the basis of these facts, the Presiding Commissioner found and ruled that the Board had jurisdiction to hear and decide this appeal.  
Merits
	The appellants argued that the subject property was overvalued.  On their abatement application, they valued the subject property at $227,000.  On their Statement Under Informal Procedure and at the hearing, the appellants estimated the value of the subject property at $200,000.  The appellants primarily relied on a comparable-sales approach but also offered some criticism of several items on the subject property's property record card, including the grade of "AG" assigned to the subject property and the number of kitchens.  They also submitted, without objection from the assessors, an appraisal report, valuing the subject property at $227,000, as of April 21, 2011, prepared for a refinance with a local credit union by an appraiser who was not present and did not testify at the hearing of this appeal.  The assessors defended the assessed value, as abated, using a comparable-sales approach, addressing the criticisms raised by the appellants regarding items on the subject property's property record card, and raising factual incongruities with two of the appellants' three comparable-sale selections. 
	All of the appellants' purportedly comparable-sale properties were located in the neighboring town of Dalton and were the same properties that the appraiser had used in his appraisal report for the local credit union.  After applying the appraiser's adjustments and then subtracting additional $10,000 locational adjustments to these three properties' sale prices to account for these properties' perceived superior locations in Dalton as opposed to Hinsdale, the appellants' indicated values ranged from $181,210 to $217,320.  The assessors pointed out that one of the appellants' three sales was a foreclosure transaction and another was a property that was not comparable to the subject property because, among other factors, it had minimal brick siding compared to the subject property's entire brick façade.  
	The assessors' two purportedly comparable-sale properties were also in Dalton, and they produced indicated values of $246,150 and $253,000, without any locational adjustment.  Both the appellants and the assessors relied on the January 18, 2011 sale of 80-82 Carson Ave. in Dalton for $233,500.  The appellants, relying on the adjustments in the appraisal report including its locational adjustment, reduced the sale price to $217,320, while the assessors increased the comparable property's sale price upward to $246,150.  The appellants did not introduce any credible evidence to support their additional $10,000 downward locational adjustment.       
	In consideration of all of the evidence, the Presiding Commissioner found that the appellants failed to demonstrate that the subject property was overvalued, as abated, for the fiscal year at issue.  In particular, the Presiding Commissioner found that the assessors adequately addressed the concerns raised by the appellants about the possible existence of several discrepancies on the subject property's property record card, including the subject property's grade and the number of kitchens.  The Presiding Commissioner found that the grade of "AG" was reasonable given the subject property's level of maintenance and that the number of kitchens on the subject property's property record card simply reflected the existence of two kitchens in the subject property's two-family dwelling.  In addition, the Presiding Commissioner found that only one of the appellants' purportedly comparable-sale properties was probative for determining an indicated value for the subject property.  As the assessors had noted, one of the other two comparable-sale properties was a foreclosure sale which indicated compulsion, and the other comparable-sale property was simply not comparable to the subject property.  As for the third comparable-sale property, upon which both parties relied in their comparable-sales analyses, the Presiding Commissioner found that the appellants' $10,000 downward locational adjustment was not adequately supported by the appellants with any objective data or reasonable explanation.  After eliminating it, the Presiding Commissioner found that this comparable-sale property's adjusted value ranged from the appellants' value of $227,320 to the assessors' value of $246,150.  The Presiding Commissioner found that the subject property's assessment, as abated, for the fiscal year at issue fell in the middle of this range.      
In addition, the Presiding Commissioner found that the appraisal report, which was submitted into evidence by the appellants without objection from the assessors, had been prepared for a bank refinance and was of little evidentiary value because the adjustments to sale prices and the opinions of value contained within it were hearsay.  The appraiser who prepared the appraisal was not present at the hearing, and he, therefore, did not testify and was not available for cross-examination or for questions from the Presiding Commissioner.  The appellants, in their analysis, had essentially adopted the adjustments proposed by the appraiser without providing any rationale or explanation of their own.  As for the single comparable sale offered by both parties, the Presiding Commissioner found that the assessors' adjustments were better explained and were the more credible of the two.  Accordingly, the Presiding Commissioner found that the assessors' evidence, and the evidence taken as a whole, supported the assessment, as abated.  
On these bases, the Presiding Commissioner found that the appellants failed to meet their burden of establishing that the subject property was overvalued for the fiscal year at issue and, therefore, decided this appeal for the appellee.  

OPINION
	"All property, real and personal, situated within the commonwealth . . . shall be subject to taxation."       G.L. c. 59, § 2.  The assessors are required to assess real estate at its fair cash value determined as of the first day of January preceding the start of the fiscal year.         G.L. c. 59, §§ 2A and 38.  Fair cash value is defined as the price on which a willing seller and a willing buyer in a free and open market will agree if both of them are fully informed and under no compulsion.  Boston Gas Co. v. Assessors of Boston, 334 Mass. 549, 566 (1956).   
	The burden of proof is upon taxpayers to make out their right as a matter of law to abatement of the tax.  Schlaiker v. Assessors of Great Barrington, 365 Mass. 243, 245 (1974).  The taxpayers must show that the assessed valuation of the subject property was improper.  See Foxboro Associates v. Assessors of Foxborough, 385 Mass. 679, 691 (1982).  The assessment is presumed valid until the taxpayers sustain their burden of proving otherwise.  Schlaiker, 365 Mass at 245.
	In appeals before this Board, taxpayers "ʽmay present persuasive evidence of overvaluation either by exposing flaws or errors in the assessors' method of valuation, or by introducing affirmative evidence of value which undermines the assessors' valuation.'"  General Electric Co. v. Assessors of Lynn, 393 Mass. 591, 600 (1984)(quoting Donlon v. Assessors of Holliston, 389 Mass. 848, 855 (1983)).      
	In the present appeal, the appellants tried to show that the assessed value of the subject property exceeded its fair cash value by disputing certain items on the property record card and by introducing an analysis of purportedly comparable-sale properties and an appraisal report prepared for a bank refinance by an appraiser who was not present and did not testify at the hearing of this appeal.  
With respect to the appellants' dispute of the grade and number of kitchens assigned to the subject property on the subject property's property record card, the Presiding Commissioner found that the assessors adequately addressed and explained the disputed items.  Accordingly, the Presiding Commissioner found and ruled that the appellants' did not sustain their burden of proving that the assessors had erred on the subject property's property record card and, that, as a result, had over-valued the subject property.  
With respect to affirmative evidence of value, the Presiding Commissioner found and ruled that the appellants' purportedly comparable-sale properties and analysis did not demonstrate that the subject property was over-valued.    The Presiding Commissioner found that one of their purportedly comparable properties' sales resulted from an undisputed foreclosure transaction, which indicated compulsion, DSM Realty, Inc. v. Assessors of Andover, 391 Mass. 1014 (1984)(rescript opinion)("A foreclosure sale inherently suggests a compulsion to sell; a proponent of evidence of such sale must show circumstances rebutting the suggestion of compulsion."), while  another of their purportedly comparable properties was not comparable to the subject property because of significant and fundamental differences with it.  See, e.g., Hinds v. Assessors of Manchester-By-The-Sea, Mass. ATB Findings of Fact and Reports 2006-771, 780 ("[T]he appellants' purportedly comparable properties were . . . so [dissimilar from] the appellants' property that their comparability was dubious.")(citing Narkiewich v. Assessors of Newbury, Mass. ATB Findings of Fact and Reports 2006-354, 360-61).  
Moreover, the Presiding Commissioner found and ruled that the appellants' comparable-sale analysis was faulty because it not only relied on adjustments from an appraisal report prepared for a refinance with a local credit union by an appraiser who was not present at the hearing, but it also included substantial locational adjustments which were not supported by any objective evidence or reasonable explanation.  The Presiding Commissioner found and ruled that the adjustments to sale prices and the opinions of value contained within the appraisal report prepared at the request of a local credit union in connection with a refinance of the mortgage on the subject property were unsubstantiated hearsay, and therefore, the Presiding Commissioner ruled that they were not reliable evidence of appropriate adjustments to make to account for differences between the purportedly comparable properties and the subject property or of the subject property's fair market value.  See, e.g., Ward Brothers Realty Trust v. Assessors of Hingham, Mass. ATB Findings of Fact and Reports 2012-515, 525 (rejecting adjustments and an opinion of value contained in an appraisal report on the basis of hearsay where the author of the report did not testify at the hearing and therefore was not available for cross-examination by the opposing party or questioning by the Presiding Commissioner). 
Finally, the Presiding Commissioner found and ruled that the assessors' testimony and exhibits, which credibly explained the concerns raised by the appellants about the grade and number of kitchens assigned to the subject property on the subject property's property record card and also provided comparable-sales support for the assessed value, as abated, were the more credible and reliable evidence of record.  "The board [is] not required to believe the testimony of any particular witness but [may] accept such portions of the evidence as appear to have the more convincing weight."  Assessors of Quincy v. Boston Consol. Gas Co., 309 Mass. 60, 72 (1941).  "The credibility of witnesses, the weight of the evidence, and inferences to be drawn from the evidence are matters for the board."  Cummington School v. Assessors of Cummington, 373 Mass. 597, 605 (1977).     

On these bases, the Presiding Commissioner found and ruled that the appellants failed to meet their burden of proving that the subject property was overvalued for the fiscal year at issue and, therefore, decided this appeal for the appellee.
	  
  					APPELLATE TAX BOARD

				By:			          ____	_________
				   Richard G. Chmielinski, Commissioner 

A true copy,

Attest:					
    	    Clerk of the Board

 According to the testimony, the grade "AG" represents that the subject property was in average to good condition as of the relevant valuation and assessment date.

ATB 2015-193