Bilinsky v. Town of Newry

STATE OF MAINE SUPERIOR COURT

OXFORD, ss. DOCKET NO. CV-10-46 '

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SOPHIA BILINSKY and

WALTER SHEVCHUK,

Plaintiffs

v. ORDER AND DECISION

TOWN OF NEWRY,

Defendant

Before the court is the appeal by plaintiffs, Sophia BiIinsky and Walter Shevchuk,

from a decision of the Oxford County Board of Assessment of Review denying an

abatement of real estate taxes assessed against their property in the Town of Newry.

A. BACKGROUND l

On May 6, 2005, the plaintiffs purchased land located at 24 Powder Ridge Road

in the Town of Newry. They paid $220,000. The plaintiffs submitted a building

application with an estimated cost of construction of $2,000,000, which was approved

on June 21, 2007. Construction of a residence on the property was completed in

December of 2008. The plaintiffs currently use the residence as a vacation home and as

a rental property.

In September of 2009, the Town Tax Assessor assessed the value of the property

at $3,105,300. The approximate 4.45 acres of land was assessed at $274,600 and the

Ibuilding was assessed at $2,830,700. The Town Assessor used the same methodology

lIThe record before the court includes all evidence submitted to the Board of Assessment Review, as

Iwell as the Board member's written statements regarding the application. The Board attempted to record

the April 21, 2010 hearing, but the recording equipment failed. Although this can sometimes result in a

Irecord that makes judicial review difficult, see Ram's Head Partners, LLC v. Town of Cape Elizabeth, 2003

IME 131, 'lI'IT 16-17,834 A.2d 916, 92L the record, in this case, when reviewed as a whole, is sufficient to

lallow meaningful appellate review.

RECEIVED

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Oxford Su nurt

for assessing the plaintiffs' property as used on other proprieties in the area. The

assessor, "[i]n showing other land values in comparison, [noted] they were each in a

different sub-division which would be priced at its own pricing schedule." The

assessor used "a percentage increase to reflect lot development throughout the town

which is a common assessing practice." Believing that the property was overvalued,

the plaintiffs hired an independent appraiser, who assessed the fair market value of the

property at $1,775,000.1

On October 16, 2009, the plaintiffs filed an application for an abatement of

property taxes with the Town, requesting that the assessment to the real estate be

reduced to $1,800,00. On January 28, 2010, the Town sent the plaintiffs a letter

requesting infonnation on the property's construction costs, a copy of the homeowner's

policy, as well as an income and expense report. In response, on February 1, 2010, the

plaintiffs infonned the Town that, pursuant to 36 M.R.S.A. § 844, because the Town

failed to act within sixty days of the abatement application, they were appealing to the

Oxford County Board of Assessment Review. The plaintiffs did not provide the Town

with the information requested. 3 On February 11, 2010, the plaintiffs appealed to the

2 The plaintiffs' appraiser utilized the sales approach and the cost approach in making his assessment.

He was unable to generate an income cost analysis.

3 In its reply brief, the Town argues that the appeal should be barred because the plaintiffs refused to

provide the Town with the requested information about their property, even though the request was

made after the Town, pursuant to 36 M.R.S.A. § 842, effectively denied their application by failing to

make a decision within 60 days. The Town contends that the failure to produce the information violates

36 M.R.S.A. § 706, and its mandate that

If the assessor ... fail[s] to give notice by mail, the taxpayer is not barred of his right to

make application for abatement provided that upon demand the taxpayer shall answer in

writing all proper inquiries as to the nature, situation and value of his property liable to

be taxed in the State; and a refusal or neglect to answer the inquiries and subscribe the

same bars an appeal ....

Although the information requested may have aided the parties in coming to an agreeable resolution, and

although the Town may have had the opportunity to inquire further about the property "pursuant to the

last paragraph of section 706" had it requested the information within the sixty-day notice of decision

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Board.

On April 21, 2010, the Board held a hearing on the plaintiffs' abatement appeal.

At hearing, the evidence presented included:

• plaintiffs' power point presentation;

• plaintiffs' independent appraisal of their property;

• plaintiffs' testimony regarding the quality of the construction of their home as

compared to the quality of construction of six allegedly comparable properties in

the area;

• plaintiffs' testimony and tax card documentation purporting to demonstrate that

the plaintiffs' property had a higher assessment than the six properties in the

categories of cost per square foot, heating, plumbing, porch additions, physical

depreciation, change in land value, and grade;

• a spread sheet relaying property grade4 information;

• the testimony of the Town Assessor explaining his valuation;

• the testimony of the Town Assessor that the plaintiffs' appraiser did not clarify

all of the statements in his appraisal;5 and

• the testimony of the Town Assessor that had the plaintiffs' actual construction

costs been available, both appraisals would have likely been more accurate.

On May 5, 2010, the Board denied the appeal by a vote of 4-1. The Board issued

written findings of fact and conclusions of law, finding that the plaintiffs had not met

timeline, see Champion Int'l Corp. v. Town of Bucksport, 667 A.2d 1376, 1377 (Me. 1995), the plaintiffs had

the right to appeal to the Board after not receiving a decision from the Town within sixty days. See 36

M.R.5.A. §§ 842, 844. Therefore, the plaintiffs should not be barred from appealing to the Oxford County

Board of Assessment Review decision. See, e.g., Town of Vienna v. Kokernak, 612 A.2d 870, 874 (Me. 1992)

(noting that the purpose of the sixty-day notice of decision statute "is to protect a taxpayer from the

commissioners' failure to act [and to give] the taxpayer the right to proceed to another forum if ... a

decision [is not made] within the requisite period of time").

4 The grade is a measure of quality used by assessors.

5 The plaintiffs' independent appraiser did not attend the hearing because the Town was unwilling to

change the date of the hearing, despite being informed by the plaintiffs that the appraiser was

unavailable. At the April 21, 2010 hearing, the accuracy of the appraisal was questioned, and the

plaintiffs argue that they were not afforded an adequate opportunity to rebut or rehabilitate the

appraiser's credibility because he was not available to testify. The plaintiffs contend that the Board's

refusal to change the date of the hearing deprived them of a fair hearing. Both parties, however, were

allowed to present their positions. The court is not persuaded that the plaintiffs were deprived of a fair

hearing. See Tawn afVienna v. Kakernak, 612 A.2d 870, 874 (Me. 1992) (noting that "[i]n the administrative

arena, due process requirements are flexible and entail no specified form or procedure").

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their burden of proof to demonstrate that the Town's 2009 revised assessment6 was

manifestly wrong.

The plaintiffs have appealed the Board's decision pursuant to Rule 80B of the

Maine Rules of Civil Procedure.

II. DISCUSSION

A. Standard of Review

"Article 9, section 8 of the Maine Constitution requires that 'all taxes upon real

and personal estate ... shall be apportioned and assessed equally, according to the just

value thereof.'" City of Biddeford v. Adams, 1999 ME 49, 114, 727 A.2d 346, 349. "'Just

value' must reflect the fair 'market value.'" Muirgen Props., Inc. v. Town of Boothbay,

663 A.2d 55,58 (Me. 1995) (quoting Shawmut Inn v. Town of Kennebunkport, 428 A.2d 384,

389 (Me. 1981». "Local assessors have been given considerable leeway in choosing the

method or combinations of methods to achieve just valuations." Wesson v. Town of

Bremen, 667 A.2d 596,598 (Me. 1995). "A town's assessment is presumed valid and the

taxpayer must prove it is manifestly wrong." Adams, 1999 ME 49,113,727 A.2d at 349.

To show that an assessment is manifestly wrong, a taxpayer must prove:

(1) The judgment of the assessors was irrational or so unreasonable in

light of the circumstances that the property is substantially overvalued

and an injustice results;

(2) There was unjust discrimination; or

(3) The assessment was fraudulent, dishonest, or illegal.

Muirgen Props., Inc., 663 A.2d at 58 (internal citations omitted); see also Town of Southwest

Harbor v. Harwood, 2000 ME 213,18,763 A.2d 115, 117-18.

& During the hearing it was discovered that the Town made a computation error regarding the square

footage of the residence. As a result the Town agreed to reduce the 2009 assessment from $2,830,700 to

$2,799,100, a reduction of $306,200.

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The court reviews the Board's "decision for abuse of discretion, error of law, or

findings unsupported by substantial evidence in the record." Muirgen Props., Inc.,

663 A.2d at 58. "Substantial evidence exists when a reasonable mind would rely on that

evidence as sufficient support for a conclusion; the possibility of drawing two

inconsistent conclusions does not render the evidence insubstantial." Adelman v. Town

of Baldwin, 2000 ME 91, <J[ 12, 750 A.2d 577, 853 (internal citations omitted). The court

"will vacate the [Board's] conclusion that the taxpayer failed to meet this burden 'only if

the record compels a contrary conclusion to the exclusion of any other inference."'

Yusum v. Town of Raymond, 2001 ME 61, <J[ 9, 769 A.2d 865, 870 (quoting Weekley v. Town

of Scarborough, 676 A.2d 932,934 (Me. 1996)).

B. Whether the Assessment was Manifestly Wrong

The plaintiffs contend that the record compels the conclusion that their property

was substantially overvalued because the Board failed to consider the fair market value

of the property. They argue that their independent appraisal was more reflective of the

just value of the property because it utilized more accurate methods of detennining fair

market value by comparing their property to other comparable homes in the area. They

assert that the $1,000,000 difference between their assessment and the Town's

assessment demonstrates the overvaluation of their property. They also claim that the

1.54 average grade of homes in the area, compared to the 2.81 grade of their home,

demonstrates unjust discrimination. 7 The Town argues that the Board's decision is

legally correct and supported by substantial evidence on the record.

7 The plaintiffs also contend that the Board erred by not making an independent determination of the

property's value. In Town of Southwest Harbor v. Harwood, 2000 ME 213, 1 7, 763 A.2d 115, 117, the Law

Court clarified when a Board must make an independent valuation assessment:

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The Board determined that the plaintiffs did meet their burden to prove that the

Town's valuation was manifestly wrong. See Town of Southwest Harbor v. Hanvood, 2000

ME 213, C][ 8, 763 A.2d 115, 117. The plaintiffs had an opportunity to present evidence

and were heard. The Board chose not to accept the valuation advocated by the

plaintiffs. Rather, it based its decision on the Assessor's valuation of the property,

which is presumed valid, and the deficiencies in the plaintiffs' independent appraisal.

The Board did not err in concluding that the Town's assessed value was not manifestly

wrong, nor did it make a decision that was unsupported by the facts on the record. See

McCuollough, 687 A.2d at 631 (noting that Boards have discretion in resolving a factual

dispute). Therefore, it was not error for the Board to accept the Assessor's opinion and

determine that the independent appraisal was not an accurate reflection of the value of

the plaintiffs' property. The assessed value of the property is not "so unreasonable as to

violate the constitutional mandate of justness and equality." Shawmut Inn, 428 A.2d at

395.

Plaintiffs also contend that they were subject to unjust discrimination because

other comparable parcels in the area are assessed at a lower grade. There is competent

evidence in the record, however, to support the Board's conclusion that the Assessor's

decision did not unjustly discriminate.

In an abatement proceeding, the Board must undertake its responsibilities in two parts.

The Board begins its review with the presumption that the assessor's valuation is valid.

Chase v. Town of Machiasport, 1998 ME 260,113,721 A.2d 636, 640. The taxpayer has the

burden of overcoming that presumption. City of Waterville v. Waterville Homes, Inc.,

655 A.2d 365,367 (Me. 1995). If the taxpayer presents sufficient evidence to meet his or

her burden, and the Board is convinced that the assessed value was manifestly wrong,

then the Board has the responsibility to undertake its own determination of just value

and to grant "such reasonable abatement as the board thinks proper." 36 M.R.S.A. §

843(1); accord City of Biddeford v. Adams, 1999 ME 49, 11 24-25, 727 A.2d 346, 351-52;

Quoddy Realty Corp. v. City of Eastport, 1998 ME 14, 111, 704 A.2d 407, 410.

Id. In this case, the Board found that the plaintiffs failed to meet their burden and upheld the Town's

valuation, therefore, it was not required to make an independent valuation.

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It is clear that the Board considered the plaintiffs' contention that their property

was treated differently from other properties in the Town, but were not persuaded by

that contention. The Board's findings explicitly note that the independent appraiser's

statement that the plaintiffs' home was II superior" to any other home sold in the

Sunday River area contradicts the argument that the plaintiffs' property was made with

lower quality materials than the six comparable properties used in the assessment. See

Town of Bristol Taxpayers' Ass'n v. Bd. of Selectmen/Assessors for Bristol, 2008 ME 159, 111,

957 A.2d 977, 979 ("Only similarly situated properties must receive approximately

equivalent tax treatment.") (citing Ram's Head Partners, LLC v. Town of Cape Elizabeth,

2003 ME 131, 110, 834 A.2d 916, 919). The findings also note that the plaintiffs failed to

submit any other evidence of the construction costs associated with the home, evidence

that they may not have been required to provide, but that could have supported their

unjust discrimination claim. The Board considered the plaintiffs' claims, found that

they were not supported by the evidence, and concluded that the Town's assessment

was not manifestly wrong. See Hanvood, 2000 NIE 213, 1 22, 763 A.2d at 121 ("Faced

with conflicting opinions, the Board was entitled to make credibility

determinations ... .") (internal citations omitted). Because the plaintiffs "did not meet

their burden to show that their assessment was manifestly wrong, the Board was not

compelled to grant an abatement. II Wesson, 667 A.2d at 599 (citing Glenridge Dev. Co. v.

City ofAugusta, 662 A.2d 928, 931 (Me. 1995».

III. CONCLUSION

The Board's decision is supported by substantial evidence on the record, and the

plaintiffs have not met their burden of demonstrating that their property was assessed

in excess of its value or that it was subject to unjust discrimination.

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The entry is:

Judgment for the Town of Newry. The decision of the

Oxford County Board of Assessment Review is

affirmed.

DATED:

Rogert 1 ford

Active Retired Justice

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