Leonard and Debora Hinds v. Board of Assessors of the Town of Manchester-by-the-Sea (October 6, 2006)

COMMONWEALTH OF MASSACHUSETTS

APPELLATE TAX BOARD


LEONARD AND DEBORA HINDS    v.	BOARD OF ASSESSORS
     					    	OF THE TOWN OF
							MANCHESTER-BY-THE-SEA

Docket No. F267939		   		Promulgated:
							October 6, 2006


	This is an appeal filed under the formal procedure pursuant to G.L. c. 58A, § 7 and G.L. c. 59, §§ 64 and 65 from the refusal of the appellee to abate taxes assessed on real estate located in the Town of Manchester-by-the-Sea owned by and assessed to Leonard and Debora Hinds under G.L. c. 59, §§ 11 and 38, for fiscal year 2003.
	Commissioner Gorton heard the appeal.  He was joined by Commissioners Scharaffa, Egan, and Rose in the decision for the appellee.
	These findings of fact and report are promulgated at the request of the appellants pursuant to G.L. c. 58A, § 13 and 831 CMR 1.32.


	Peter J. Feuerbach, Esq., for the appellants.

	Virginia Noyes Thompson, Principal Assessor, for the appellee.

 


FINDINGS OF FACT AND REPORT

Based on evidence and testimony offered at the hearing of this appeal, the Appellate Tax Board ("Board") made the following findings of fact.
On January 1, 2002, Leonard and Debora Hinds ("appellants") were the assessed owners of a parcel of real estate located in the Town of Manchester-by-the-Sea ("subject property" or "subject").  For fiscal year 2003 ("fiscal year at issue"), the Board of Assessors of the Town of Manchester-by-the-Sea ("assessors") valued the subject property at $1,505,900 and assessed a tax, at the rate of $8.38 per thousand, in the amount of $12,619.44.  The appellants timely paid their taxes without incurring interest.  On January 28, 2003, the appellants timely filed an application for abatement with the assessors seeking a reduction in the valuation of the subject property.  On February 27, 2003, the assessors denied the appellants' application.  On May 23, 2005, the appellants timely filed their appeal with the Board.  On this basis, the Board found that it had jurisdiction to hear and decide this appeal. 
The subject property consists of a 0.775 acre parcel of land improved with a single-family residence located on Masconomo Street in the Town of Manchester-By-The-Sea ("Town").  The appellants maintained that the subject property was overvalued for the fiscal year at issue.  In particular, the appellants contended that the assessors overvalued the land component of the subject property's overall assessment because:  the subject property was burdened by two private roads and a large septic area; the lot was small; it was not a waterfront property; and, zoning ordinances prohibited expansion of the existing home.  To support their assertions, the appellants offered evidence including:  printed digital photographs of the subject property; printed digital photographs of the views from the subject property; printed digital photographs of other surrounding properties and their views; an area "valuation survey" of Masconomo Street; the plot plan of the subject property; and, the zoning by-laws of the Town.  The appellants also compiled a chart, based on data from the fiscal year at issue, comparing the assessed land values of the various properties featured in their "valuation survey."  All properties listed on the chart, in contrast to the subject, were situated on the waterfront.  Below is a summary of the pertinent information listed in the appellants' chart:	


Parcel I.D. (Map-Lot)	Acres (square feet)	Assessed land value	Assessed land value per square foot	
 Hinds    (18-17)	0.775 (33,750)	$1,272,600	$37.6/s.f.	
18-23A,   18-23B	1.125 (49,000)	$689,631	$14.1/s.f.	
18-30	2.588 (112,730)	$2,204,400	$19.2/s.f.	
18-10	3.823 (166,573)	$2,386,400	$14.3/s.f.	
18-21	4.103 (178,624)	$2,427,700	$13.6/s.f.	
18-8	4.343 (189,050)	$2,463,100	$13.0/s.f.	
18-28	4.918 (214,210)	$2,337,600	$10.9/s.f.	
18-18	6.909 (300,961)	$2,841,400	$9.4/s.f.	
  
In defense of their assessment of the subject property, the assessors maintained that the total assessment of the appellants' land and home represents the overall fair cash value of the subject property for the fiscal year at issue.  They submitted as evidence three property record cards from purportedly comparable properties and pictures of these properties.  They also submitted a letter from Paul Orlando, the Building Inspector for the Town to Virginia Noyes Thompson, the Principal Assessor, stating that the subject property "is a buildable lot, and the current structure on the property could be extended, changed or altered."
On the basis of all of the evidence, the Board found that the appellants failed to meet their burden of proving that their overall assessment was excessive.  The Board found that the appellants' several arguments were flawed.  
First, the Board found that, based on the letter from the Building Inspector, the subject property was a buildable lot and that, contrary to the appellants' assertion, they could alter and expand their existing home.  Second, the Board found that all but one of the properties cited in the appellant's chart were not sufficiently comparable to the subject property, because their lot sizes were significantly larger than that of the subject property.  It is a common and appropriate practice for assessors to consider size differences in valuing property.  As stated in the Appraisal Institute's treatise, The Appraisal of Real Estate (12th ed., 2001), on page 196:  "Generally, as size increases, unit prices decrease.  Conversely, as size decreases, unit prices increase."  
Only the property consisting of two parcels, 18-23A and 12-23B, was plausibly comparable in size with the subject property.  However, the appellants offered insufficient information about this property's topography, its condition and developmental potential, and the structure on the property, to assist the Board in making a useful comparison between this property and the subject.
Finally, the Board found that the appellants did not introduce evidence describing the subject property in sufficient detail, particularly the structure on the property.  This lack of evidence precluded the Board's ability to compare the subject in the necessary detail to sales or assessments of other properties in the area.  Because their evidence was so narrowly focused on land values, the appellants did not indicate any other similarities and/or differences between the subject property and the purportedly comparable properties appearing on their chart.  Missing was information about, for example, the condition, topography, and developmental potential of the properties, and the size, condition, and style of the dwellings.  See Appraisal of Real Estate, supra, at 426, 435-37 (physical characteristics and location are "significant factors to be considered" in valuation comparison analyses).  The Board thus had little evidence on which to rely to determine whether the overall assessment of the subject property was excessive.  The appellants' reliance on these allegedly comparable properties' assessed land values, without adjustment, to prove that the subject property was over-assessed was unpersuasive.
On this basis, the Board found that the appellants failed to meet their burden of proving that the subject property was overvalued for the fiscal year at issue.  The Board, 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 of each 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 appellant has the burden of proving that the subject property has a lower value than that assessed. "'The burden of proof is upon the petitioner to make out its right as [a] matter of law to [an] abatement of the tax.'" Schlaiker v. Assessors of Great Barrington, 365 Mass. 243, 245 (1974) (quoting Judson Freight Forwarding Co. v. Commonwealth, 242 Mass. 47, 55 (1922)). "[T]he [B]oard is entitled to 'presume that the valuation made by the assessors [is] valid unless the taxpayers . . . prov[e] the contrary.'" General Electric Co., 393 Mass. at 598 (quoting Schlaiker, 365 Mass. at 245). 
In appeals before this Board, a taxpayer "may 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)).    
Regarding the assessors' valuation of the land, a taxpayer does not conclusively establish a right to an abatement merely by showing that his land is overvalued.  "The tax on a parcel of land and the building thereon is one tax . . . although for statistical purposes they may be valued separately."  Assessors of Brookline v. Prudential Insurance Co., 310 Mass. 300, 317 (1941).  In abatement proceedings, "the question is whether the assessment for the parcel of real estate, including both the land and the structures thereon, is excessive.  The component parts, on which that single assessment is laid, are each open to inquiry and revision by the appellate tribunal in reaching the conclusion whether that single assessment is excessive."  Massachusetts General Hospital v. Belmont, 238 Mass. 396, 403 (1921).  See also Buckley v. Assessors of Duxbury, ATB Findings of Fact and Reports 1990-110, 119; Jernegan v. Assessors of Duxbury, ATB Findings of Fact and Reports 1990-39, 49.  
Although the appellants introduced evidence challenging the value of the land component of the subject assessment, they introduced insufficient credible evidence showing that the overall assessment of the subject property exceeded its fair cash value as of the relevant assessment date.  The appellants offered no evidence of comparable sales, and only limited data as to comparable assessments to substantiate their claim of overvaluation for the subject property.  Their evidence, which focused solely on assessed land values, failed to draw a sufficient comparison between these properties and the subject property, because the evidence failed to elucidate any other similarities and/or differences which would support the appellants' claim of over assessment for the entire property, not just the land component.  See, e.g., Ecker v. Board of Assessors of the Town of Chatham, ATB Findings of Fact and Reports 2003-81, 90.  
Moreover, with the exception of one property, the appellants' purportedly comparable properties were differently situated and so much larger than the appellants' property that their comparability was dubious.  See, e.g., Narkiewich v. Board of Assessors of the Town of Newbury, ATB Findings of Fact and Reports 2006-354, 360-61.  Finally, the letter from the Building Inspector, submitted by the assessors, successfully refuted the appellants' argument that they were prohibited from altering or expanding their home.  Therefore, the Board found and ruled that the information introduced by the appellants did not establish that the subject property's overall assessment exceeded its fair cash value.  
Based on the evidence presented, the Board found and ruled that the appellants did not meet their burden of proving that the subject property's overall assessment was excessive.  On this basis, the Board issued a decision for the appellee in this appeal.
						APPELLATE TAX BOARD


				 By:	___________________________________
					Thomas W. Hammond, Jr., Chairman
A true copy,

Attest:____________________________
	  Assistant Clerk of the Board

ATB 2006-771