Thomas A. Bubier, Trustee v. Board of Assessors of the City of Lynn (January 19, 2001)

COMMONWEALTH OF MASSACHUSETTS
APPELLATE TAX BOARD


THOMAS A. BUBIER, TRUSTEE     v.	  BOARD OF ASSESSORS OF
                                        THE CITY OF LYNN

Docket No. F255132				Promulgated:
							January 19, 2001


	This is an appeal under the formal procedure pursuant to G.L. c. 59, §§ 64 and 65, from the refusal of the appellee to abate real estate taxes on certain real estate in the City of Lynn owned by and assessed to Jacqueline E. Hahnan under G.L. c. 59, § 38, for fiscal year 1999.  The appellant filed his appeal as a person who acquired title to the real estate after January 1st in the fiscal year at issue. 
	Commissioner Rose heard this appeal and on October 12, 2000, issued a single member decision for the appellant in accordance with G.L. c. 58A, § 1 and 831 CMR 1.20.
	These findings of fact and report are made pursuant to a request by the appellee under G.L. c. 58A, § 13 and    831 CMR 1.32.

	Thomas A. Bubier, Trustee, pro se, for the Appellant.

	Richard K. Jeffery, Esq., for the Assessors.  

FINDINGS OF FACT AND REPORT
	On January 1, 1998, Jacqueline E. Hahnan was the assessed owner of a parcel of real estate located at 61 Henry Avenue in the City of Lynn.  The parcel contained approximately 4,293 square feet of land and was improved with a single-family house.  The Board of Assessors of Lynn ("Assessors") valued the property at $96,000, and assessed a tax thereon, at the rate of $17.73 per thousand, in the amount of $1,702.08.  
On April 24, 1999, Thomas E. Bubier, Trustee of the Phoenix Realty Trust, the appellant in this appeal, executed an agreement with Ms. Hahnan to purchase the subject property for $50,000 on or about June 15, 1999.  The property actually transferred on June 28, 1999.  The appellant recorded the deed in the Essex South District Registry of Deeds on June 29, 1999.  
On May 10, 1999, the appellant filed an application for abatement with the Assessors, within thirty days of April 12, 1999, the date when Lynn's Collector of Taxes mailed the fiscal year 1999 actual tax bills.  The appellant sought to lower the assessed value of the subject property to the agreed-upon $50,000 sale price.  The Assessors denied the appellant's abatement request on May 28, 1999, and on August 26, 1999, the appellant then filed his petition under the informal procedure with this Board.  The Assessors subsequently transferred this appeal to the formal procedure on September 22, 1999.  The Board found that all of these filings were timely.
According to the Collector's records, the assessed owner apparently paid $270 of the estimated real estate tax plus some interest on March 12, 1999.  On August 2, 1999, the appellant paid all of the outstanding taxes and interest.  However, because the assessed real estate taxes were $3,000 or less, the Board found that incurring interest did not, in and of itself, defeat the Board's jurisdiction.  G.L. c. 59, §§ 64 and 65.     
On June 5, 2000, the Assessors moved to dismiss this appeal for lack of jurisdiction.  On June 15, 2000, following a hearing on the Assessors' motion, the Board denied the Assessors' request to dismiss this appeal.  On October 4, 2000, the Board conducted a full evidentiary hearing on the merits of this appeal where the Assessors renewed their motion to dismiss.  
At this hearing, Mr. Bubier testified that the monetary consideration recited on the deed represented the fair market value of the subject property on the requisite assessment date for the fiscal year at issue.  He confirmed that the property's $50,000 selling price resulted from negotiations between knowledgeable but unrelated parties who were not under any compulsion or undue influence.   He considered the transaction to be an arms-length sale.  The Board found that his testimony was credible.  
The Assessors offered no contrary evidence in this regard.  In fact, they represented that they did not contest the $50,000 value ascribed to the property by the appellant.  Rather, they renewed their argument first presented in their motion to dismiss that the appellant had no standing to bring this appeal.  
On this basis, the Board found that the value of the subject property for fiscal year 1999 was $50,000.  The Board also found that, pursuant to G.L. c. 59, § 59, the appellant was "a person who acquire[d] title to real estate after January first in any year" and should therefore "be treated as a person upon whom a tax has been assessed."   G.L. c. 59, § 59.  Accordingly, the Board reconsidered and again denied the Assessors' motion to dismiss based on its factual findings and for the reasons set out more fully in its Opinion below. 
 Therefore, the Board found that it had jurisdiction over this appeal and granted the appellant an abatement in the amount of $815.58.

OPINION
Jurisdiction
	The threshhold jurisdictional issue presented to the Board by the Assessors' motion and renewed motion to dismiss was whether the appellant had proper standing to prosecute this appeal where he did not acquire title to the property before filing his application for abatement.
	G.L. c. 59, § 59, provides in pertinent part that:
A person upon whom a tax has been assessed . . . , if aggrieved by such tax, may . . . , on or before the last day for payment . . . of the actual tax bill . . . for the [relevant] fiscal year . . . apply in writing to the assessors . . . for an abatement thereof.

Id.  In addition, § 59 provides the right to appeal real estate tax assessments to a number of categories of individuals other than assessed owners.  For example, "[a] tenant of real estate paying rent therefor and under an obligation to pay more than one-half of the taxes thereon may apply for such abatement."  Id.  Section 59 goes on to provide in relevant part that:
If a person other than the person to whom a tax on real estate is assessed is the owner thereof, or has an interest therein, or is in possession thereof, and pays the tax, he may thereafter prosecute in his own name any application, appeal or action provided by law for the abatement or recovery of such tax, which after the payment thereof shall be deemed for the purposes of such application, appeal or action, to have been assessed to the person so paying the same.

Id.   Moreover, Section 59 authorizes, under certain circumstances, "[t]he holder of a mortgage on real estate who has paid not less than one-half of the tax thereon     . . . [to] prosecute any appeal or action provided by law for the abatement or recovery of such tax in the same manner and subject to the same conditions as a person aggrieved by a tax assessed upon him."   Id.  Finally, "[n]otwithstanding any other provision of this section, a person who acquires title to real estate after January first in any year, shall for purposes of this section be treated as a person upon whom a tax has been assessed.  Id.  
	It is a well-known requirement that the appellant must demonstrate that he has complied with all of the necessary statutory prerequisites for this Board to find that it has jurisdiction to hear the related tax appeal.  See Donlon v. Assessors of Holliston, 389 Mass. 848, 853 (1983); Boston Five Cents Savings Bank v. Assessors of Boston, 311 Mass. 415, 416 (1942); Assessors of Boston v. Suffolk Law School, 295 Mass. 489, 492 (1936); Kinney System of Sudbury Street, Inc. v. Assessors of Boston, 2000 ATB Adv. Sh. 967, 973 (Docket No. F238348, November 30, 2000).  These prerequisites include being one of the persons authorized by statute to bring an appeal, that is a "person aggrieved."  G.L. c. 59, § 59; Donlon v. Assessors of Holliston, 389 Mass. at 854.  Accordingly, to be a "person aggrieved" under § 59 that person must be either: (1) "[a] person upon whom a tax has been assessed;" (2) "[a] tenant . . . paying rent . . . and under an obligation to pay more than one-half of the taxes;" (3) "a person other than the person to whom a tax is assessed . . . [who] is the owner, or has an interest therein, or is in possession thereof, and pays the tax;" or (4) "[t]he holder of a mortgage on real estate who has paid not less than one-half of the tax thereon."  G.L. c. 59   § 59.  Lastly, and "notwithstanding any other provision of  [§ 59], a person who acquires title to real estate after January first in any year, shall for purposes of [§ 59] be treated as a person upon whom a tax has been assessed" regardless of any tax payments.  Id.  
	In the present appeal, the Assessors argued that the appellant was not a person upon whom the tax had been assessed, and he was not a tenant.  The Assessors further maintained that the appellant never paid any meaningful amount of the real estate tax at the appropriate time and did not hold a mortgage on the property.  Moreover, the Assessors asserted that the appellant filed his application for abatement before he even owned or had title to the property.  Consequently, the Assessors contended that the appellant was not a "person aggrieved" under § 59 and, accordingly, could not maintain his appeal of the real estate tax on the subject property before this Board.
	The Board agreed with most of the Assessors' contentions in this regard.  However, the Board disagreed on one critical point and found and ruled that the appellant was "a person who acquire[d] title to real estate after January first in any year" and according to the 1977 amendment to § 59, should therefore "be treated as a person upon whom a tax has been assessed."   G.L. c. 59, § 59.  Accordingly, the Board found and ruled that the appellant also had the right to file the subject application for abatement, and, upon its denial, this appeal to the Board.  G.L. c. 59, §§ 64 and 65.
	On April 12, 1999, the Assessors mailed the actual real estate tax bills for fiscal year 1999, the fiscal year at issue in this appeal.  The bills assessed local property taxes on real estate in Lynn as of January 1, 1998.  On April 24, 1999, the appellant and the assessed owner executed a purchase and sale agreement regarding the subject property.  On May 12, 1999, the appellant filed an application for abatement with the Assessors who subsequently denied the appellant's abatement request on May 28, 1999.  On June 28, 1999, the appellant purchased the property from the assessed owner and then on August 26, 1999, filed his appeal of the Assessors' denial of his abatement request with this Board.
	Relying on these facts and the 1977 amendment to § 59, the Board found and ruled that the appellant who acquired title to the subject real estate within the affected fiscal year was "a person who acquire[d] title to real estate after January first in any year" and therefore should "be treated as a person upon whom a tax has been assessed."  G.L. c. 59, § 59.  The appellant's filing of his application for abatement before actually acquiring title did not, in and of itself, defeat his claim of appeal where the 1977 amendment does not specifically place such limitations on a taxpayer filing an application under this provision.  The appellant timely filed his application within the context of an existing purchase and sale agreement and a closing date within the relevant fiscal year.  That the provision begins with the phrase, "notwithstanding any other provision of this section," further suggests a broad interpretation regarding who and when "a person who acquires title to real estate after January first in any year" should "be treated as a person upon whom a tax has been assessed."  Id.  Moreover remedial amendments in property tax statutes are liberally construed.  See Wynn v. Board of Assessors of Boston, 281 Mass. 245, 250-52 (1932).
    Interpreting this provision in this way is neither anomalous nor open-ended. It is within the literal meaning of the provision and does not produce an absurd, unreasonable or unconstitutional result.  See Inmates of Suffolk County Jail v. Rouse, 129 F.3rd 649, 654 (1st Cir. 1999), cert. denied 524 U.S. 951, rehearing denied 524 U.S. 970 (In interpreting statute, court should rely on the literal meaning of the words unless they create an ambiguous or unreasonable result.); Tilton v. City of Haverhill, 311 Mass. 572, 577 (1942), quoting Commonwealth v. Welosky, 276 Mass. 398, 401, 402 (1931) ("'The words of a statute are the main source for the ascertainment of a legislative purpose.  They are to be construed according to their natural import in common and approved usage.'"). 
In rendering its rulings denying both the Assessors' motion to dismiss and their renewed motion, the Board also noted that to the extent that any ambiguities may exist in § 59, they should be resolved in favor of the taxpayer.  See Dennis v. Commissioner of Corporations and Taxation, 340 Mass. 629, 631 (1960); Perry v. Commissioner of Corporations and Taxation, 5 Mass. App. Ct. 764, 780-81  (1977) (rescript opinion).  For all of these reasons, the Board found and ruled that the appellant met his burden of proving that he had fulfilled the necessary prerequisites for the Board to take jurisdiction over this appeal.  See Cohen v. Assessors of Boston, 344 Mass. 268, 271 (1962).  
Valuation
The burden of proof is upon the appellant to make out his right as a matter of law to an abatement of the tax.  Schlaiker v. Board of Assessors of Great Barrington, 365 Mass. 243, 245 (1974).  The appellant must show that the assessed valuation of his property was improper.  See Foxboro Associates v. Board of Assessors of Foxborough, 385 Mass. 679, 691 (1982).  The assessment is presumed valid until the taxpayer sustains his burden of proving otherwise.  Schlaiker, 365 Mass. at 245.  The Board ruled in this appeal that the appellant met his burden in this regard.
The assessors are required to assess real estate at its fair cash value.  G.L. c. 59, § 38.  Fair cash value is defined as the price on which a willing seller and a willing buyer 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).  Generally, real estate valuation experts, the Massachusetts courts, and this Board rely upon three approaches to determine the fair cash value of property: income capitalization, sales comparison, and cost reproduction.  Correia v. New Bedford Redevelopment Authority, 375 Mass. 360, 362 (1978).  
"[S]ales of property usually furnish strong evidence of market value, provided they are arm's-length transactions and thus fairly represent what a buyer has been willing to pay for the property to a willing seller."  Foxboro Associates v. Board of Assessors of Foxborough, 385 Mass. at 682.  Actual sales of the subject "are very strong evidence of fair market value, for they represent what a buyer has been willing to pay to a seller for [the] particular property [under appeal]."  New Boston Garden Corp. v. Board of Assessors of Boston, 383 Mass. 456, 469 (1981), quoting First Nat'l Stores, Inc. v. Assessors of Somerville, 358 Mass. 554, 560 (1971).  In this appeal, the Board found and ruled that the June 28, 1999, sale of the subject property to the appellant was an arm's-length transaction between two willing and knowledgeable parties, neither of whom was under any compulsion or duress.  The Board further found and ruled that the sale was appropriately proximate in time to the relevant assessment date.  The appellant who was familiar with the subject property testified that the sale price fairly reflected the value of the subject on January 1, 1998.  
Accordingly, the Board found and ruled that the price associated with that sale fairly represented the value of the subject property on the relevant assessment date.  The Board also ruled that the record failed to disclose any duress or compulsion on the part of the parties to the sale. See The Westwood Group, Inc. v. Board of Assessors of Revere, 391 Mass. 1012, 1013 (1984), citing United-Carr, Inc. v. Cambridge Redevelopment Auth., 362 Mass. 597, 600 (1972).  The Assessors did not contest this estimate of value.    
In reaching its opinion of fair cash value, the Board was not required to believe the testimony of any particular witness or to adopt any particular method of valuation that a witness suggested.  Rather, the Board could accept those portions of the evidence that the Board determined had more convincing weight.  Foxboro Associates v. Board of Assessors of Foxborough, 385 Mass. at 683; New Boston Garden Corp. v. Assessors of Boston, 383 Mass. at 473; Board of Assessors of Lynnfield v. New England Oyster House, Inc., 362 Mass. 696, 701-702 (1972).  An owner of property is entitled to express his opinion of its value during the relevant time period if he is experienced in dealing with the property, is familiar with its characteristics, and recognizes its proper uses or potential uses.  Menici v. Orton Crane & Shovel Co., 285 Mass. 499, 503-504 (1934), and the cases cited therein.  Accord Correia v. New Bedford Redevelopment Authority, 5 Mass. App. Ct. 289, 295 (1977), rev'd on other grounds, 375 Mass. 360 (1978).  In this appeal, the Board found and ruled that the appellant possessed the requisite familiarity, knowledge, and experience about his property, as well as the circumstances surrounding his purchase of it, to express meaningfully his opinion of its value.  Accordingly, and in conjunction with the other evidence that he presented, the Board considered his opinion of the subject's value.  
In evaluating the evidence before it in this appeal, the Board selected among the various elements of value and formed its own independent judgment of fair cash value.  See General Electric v. Assessors of Lynn, 393 Mass. 591, 605 (1984); North American Philips Lighting Corp. v. Assessors of Lynn, 392 Mass 296, 300 (1984).
The Board need not specify the exact manner in which it arrived at its valuation.  Jordan Marsh v. Assessors of Malden, 359 Mass. 196, 110 (1971).  The fair cash value of property cannot be proven with "mathematical certainty and must ultimately rest in the realm of opinion, estimate and judgment."  Assessors of Quincy v. Boston Consol. Gas Co., 309 Mass. 60, 72 (1941).  "The credibility of witnesses, the weight of evidence, the inferences to be drawn from the evidence are matters for the [B]oard."   Cummington School of the Arts, Inc. v. Assessors of Cummington, 373 Mass. 597, 605 (1977).
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. at 600, quoting Donlon v. Assessors of Holliston, 389 Mass. at 855.  In the present appeal, the Board ruled that the appellant prevailed by introducing relevant, material, credible, and affirmative evidence.    
The Board applied these principles in reaching its opinion of fair cash value of the subject property in this appeal.  On this basis, the Board found and ruled that the value of the property was $50,000 for FY 1999 and thus decided that the subject was overvalued in the amount of $46,000.  The Board, therefore, granted the appellant an abatement of the real estate tax for FY 1999 in the amount of $815.58.

    							THE APPELLATE TAX BOARD
 


 					    By: ___________________________
     James D. Rose, Member
A true copy,




Attest: ________________________
		Clerk of the Board

 The subject property was assessed for $96,000 in fiscal year 1999.  The Board found that the fair cash value was $50,000.  Accordingly, the Board found that the Assessors overvalued the property by $46,000.  The applicable tax rate was $17.73 per thousand dollars of value.
 Statute 1977, c. 198, which became effective August 19, 1977, amended G.L. c. 59, § 59, by adding this proviso that requires the assessors to treat a person acquiring title after January 1st "in any year" as an assessed owner for that year.  See Massachusetts Association for the Blind v. Assessors of Brookline, 391 Mass. 384, 390 (1984).

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