The opinion
[Cite as CABOT III-OH1M02, L.L.C. v. Franklin Cty. Bd. of Revision, 2013-Ohio-5301.]
IN THE COURT OF APPEALS OF OHIO
TENTH APPELLATE DISTRICT
CABOT III-OH1M02, LLC, :
Appellant-Appellant, :
No. 13AP-232
v. : (C.P.C. No. 12CVF-13061)
Franklin County, Ohio : (ACCELERATED CALENDAR)
Board of Revision et al.,
:
Appellees-Appellees.
:
D E C I S I O N
Rendered on December 3, 2013
Taft, Stettinius & Hollister LLP, and Stephen M. Griffith, Jr.,
for appellant.
Ron O'Brien, Prosecuting Attorney, and William Stehle, for
appellees Franklin County Board of Revision and Franklin
County Auditor.
Rich & Gillis Law Group, LLC, Jeffrey A. Rich, Mark H. Gillis,
and Allison J. Crites, for appellee Columbus City School
District Board of Education.
APPEAL from the Franklin County Court of Common Pleas
SADLER, J.
{¶ 1} Appellant, CABOT III-OH1M02, LLC, appeals from the decision and entry
of the Franklin County Court of Common Pleas affirming the decision of the Franklin
County Board of Revision ("BOR") determining the taxable value of certain property
owned by appellant. For the following reasons, we affirm.
No. 13AP-232 2
I. FACTS AND PROCEDURAL HISTORY
{¶ 2} Appellant initiated this matter on March 30, 2011 with a complaint before
the BOR contesting the taxable value assigned by appellee, Franklin County Auditor
("auditor"), to appellant's property for tax year 2010. The property is a single improved
9.431-acre tract of land located at 2550 John Glenn Avenue in Columbus, Ohio and is
identified by the auditor as parcel number 430-242629. It is undisputed that the property
is located in a Community Reinvestment Area ("CRA").1 It is further undisputed that, for
accounting purposes, the auditor assigned a two-digit suffix to the original parcel number
to designate which portion of the value is taxable and which portion is tax-abated. The
taxable portion of the property, designated as parcel number 430-242629-80, consists of
paved land; the tax-abated portion of the property, designated as parcel number 430-
242629-90, consists of a warehouse building.2
{¶ 3} For 2010, the auditor assessed the true value of 430-242629-80 and 430-
242629-90 as $940,700 and $6,731,800, respectively, for an aggregate true value of
$7,672,500. The auditor assessed the taxable value of 430-242629-80 and 430-242629-
90 as $329,500 and $2,356,130, respectively, for a total taxable value of $2,685,630.
{¶ 4} In its complaint, appellant requested a reduction in both the true value and
taxable value of the property. More specifically, appellant asserted the true value of 430-
242629-80 and 430-242629-90 should be $557,860.50 and $3,992,139.50, respectively,
for an aggregate true value of $4,550,000. Appellant further asserted the taxable value of
430-242629-80 and 430-242629-90 should be $195,251.18 and $1,397,248.83,
respectively, for a total taxable value of $1,592,499.01. Appellant averred in the complaint
the requested change in value was justified because "[t]he owner acquired the property on
March 24, 2011 for $4,550,000 in an arm's length transaction." Appellant computed the
new value by (1) determining the percentage of the aggregate value assessed by the
1 "In R.C. 3735.65 et seq., the General Assembly has instituted a property tax incentive program that
promotes the construction and remodeling of commercial, industrial, and residential structures in CRAs."
Bd. of Edn. of Gahanna-Jefferson Local School Dist. v. Zaino, 93 Ohio St.3d 231, 232 (2001).
2 The derivation of our averments that these facts are "undisputed" is twofold. First, at oral argument,
counsel for appellant essentially conceded the property is located in a CRA and the -80 and -90 suffixes on
the parcel number designate the taxable and tax-abated portions of the property, respectively. Second,
property record cards attached to the complaint designate the taxable portion of the property as 430-
242629-80 and the tax-abated portion of the property as 430-242629-90.
No. 13AP-232 3
auditor to the taxable and tax-abated portions of the property, and then (2) applying that
percentage to the $4,550,000 sale price. Appellee, Columbus City Schools Board of
Education ("BOE"), filed a countercomplaint in support of the auditor's valuation.
{¶ 5} The BOR held a hearing on the matter on August 28, 2012. At the hearing,
Justin Henry, an acquisitions officer employed by appellant and familiar with the
acquisition of the subject property, testified appellant purchased the property from the
seller for $4,550,000. Henry further averred the sale was voluntary, occurred in the open
market, and both appellant and the seller acted in their own self-interest. Henry
identified documentation, including a settlement statement, deed, and purchase and sale
agreement, evidencing appellant's March 24, 2011 purchase of the property from RPH
Industrial, LLC, at a price of $4,550,000. Appellant presented no other witnesses, and
neither the auditor nor the BOE presented any witnesses.
{¶ 6} Based upon the evidence and testimony at the hearing, the BOR accepted
the sale price of $4,550,000 as the new true value of the property. In a decision filed
September 18, 2012, the BOR maintained both the $940,700 true value and the $329,500
taxable value of the taxable portion of the property. In a separate decision also filed on
September 18, 2012, the BOR reduced the true value and the taxable value of the tax-
abated portion of the property to $3,609,300 and $1,263,260, respectively. The BOR's
decisions effectively allocated all of the reduction of value of the property to the tax-
abated portion of the property; hence, appellant received no reduction in its tax liability.
{¶ 7} Appellant appealed the BOR's decision to the Franklin County Court of
Common Pleas pursuant to R.C. 5717.05. In a decision and entry filed February 26, 2013,
the common pleas court affirmed the BOR's decisions. The court also averred, in
response to a jurisdictional issue raised by the BOE, that appellant's appeal was timely
filed.
II. ASSIGNMENTS OF ERROR
{¶ 8} On appeal, appellant presents the following four assignments of error for
our review:
[I.] THE TRIAL COURT ERRED BY DETERMINING THAT
APPELLANT IS NOT AN AGGRIEVED PARTY.
No. 13AP-232 4
[II.] THE TRIAL COURT ERRED BY PRESUMING THAT
THE BOARD OF REVISION DECISION WAS VALID.
[III.] THE TRIAL COURT ERRED BY RULING THAT ANY
REDUCTION IN THE VALUE OF THE PROPERTY HAD TO
BE APPLIED FIRST TO THE PARCEL OF THE PROPERTY
THAT WAS EXEMPT FROM REAL PROPERTY TAX.
[IV.] THE TRIAL COURT ERRED BY FAILING TO
DETERMINE INDEPENDENTLY THE ALLOCATION OF
THE REDUCTION IN THE VALUE OF THE PROPERTY TO
THE TWO PARCELS OF WHICH THE PROPERTY IS
COMPRISED.
III. DISCUSSION
{¶ 9} At the outset, we address a jurisdictional issue raised by the BOE. In its
brief before the common pleas court, the BOE first asserted appellant failed to satisfy the
mandatory and jurisdictional requirements set forth in R.C. 5717.05 for perfecting an
appeal from the BOR to the common pleas court. More particularly, the BOE argued
appellant failed to serve a copy of its notice of appeal on the BOE within the 30-day filing
deadline set forth in the statute. The BOE maintained that this defect in service deprived
the common pleas court of jurisdiction over the appeal, and, therefore, the appeal should
be dismissed. The BOE further asserted that, even if the court had jurisdiction over the
appeal, the BOR properly allocated the reduction in total value of the property first to the
tax-abated portion of the property before reducing the value of the taxable portion of the
property. As noted above, the common pleas court affirmed the BOR's decisions on the
merits and rejected the BOE's jurisdictional argument, finding that appellant timely filed
its appeal.
{¶ 10} In its answer brief before this court, the BOE reasserts its jurisdictional
argument, essentially contending the common pleas court erred in failing to dismiss the
appeal. This argument is not properly before this court, however, because the BOE did
not file a cross-appeal challenging the common pleas court's failure to dismiss for lack of
jurisdiction.
{¶ 11} App.R. 3(C)(1) states in part:
A person who intends to defend a judgment or order against
an appeal taken by an appellant and who also seeks to change
No. 13AP-232 5
the judgment or order * * * shall file a notice of cross appeal
within the time allowed by App.R. 4.
(Emphasis added.)
{¶ 12} The BOE's jurisdictional argument falls within the specifications of App.R.
3(C)(1), which require the filing of a cross-appeal. Here, the BOE seeks both to defend the
common pleas court's judgment on the merits and to change the judgment from which the
appeal is taken to an outright dismissal of the appeal.
{¶ 13} It is important to note that the jurisdictional issue here does not concern the
subject-matter jurisdiction of the common pleas court to hear appellant's appeal from the
BOR's decisions. This court has stated the filing of a cross-appeal is not a prerequisite to
challenging a court's subject-matter jurisdiction, as subject-matter jurisdiction cannot be
waived and may be raised at any time. See IBM Corp. v. Bd. of Revision of Franklin Cty.,
10th Dist. No. 06AP-108, 2006-Ohio-6258, ¶ 12.
{¶ 14} In this case, any challenge to the subject-matter jurisdiction of the common
pleas court to hear appellant's appeal would have been futile. "Subject matter jurisdiction
focuses on the court as a forum and on the case as one of a class of cases, not on the
particular facts of a case or the particular tribunal that hears the case." State v. Swiger,
125 Ohio App.3d 456, 462 (9th Dist.1998). R.C. 5717.05 expressly permits an appeal from
a BOR decision to the Franklin County Court of Common Pleas ("[A]n appeal from the
decision of a county board of revision may be taken directly to the court of common pleas
of the county by the person in whose name the property is listed or sought to be listed for
taxation."). Thus, the jurisdictional issue asserted by the BOE here concerns the common
pleas court's authority to act within the jurisdiction conferred by R.C. 5717.05.
Jurisdictional defects of this type are generally considered waived unless properly
preserved on appeal. Proper preservation of the jurisdictional defect alleged by the BOE
in this case required the filing of a cross-appeal pursuant to App.R. 3(C)(1). Because the
BOE did not do so, it has waived its jurisdictional argument.
{¶ 15} Having dispensed with the BOE's jurisdictional argument, we now consider
the merits of appellant's assignments of error.
No. 13AP-232 6
A. First Assignment of Error
{¶ 16} In Kaiser v. Franklin Cty. Auditor & Franklin Cty. Bd. of Revision, 10th
Dist. No. 10AP-909, 2012-Ohio-820, ¶ 9, this court set forth the applicable standard of
review:
A party may appeal a decision of a county board of revision to
the court of common pleas under R.C. 5717.05 as an
alternative to an appeal to the Ohio Board of Tax Appeal
pursuant to R.C. 5717.01. An appeal under R.C. 5717.05, while
requiring more than a mere review of the decision of the
board of revision by the court of common pleas, is properly
limited to a comprehensive consideration of the existing
evidence and, at the court's discretion, to an examination of
additional evidence. R.C. 5717.05; Black v. Bd. of Revision of
Cuyahoga Cty., 16 Ohio St.3d 11, 14, 16 Ohio B. 363, 475
N.E.2d 1264 (1985). The court of common pleas should
consider the evidence heard by the board of revision, any
additional evidence heard at the court's discretion, and apply
its independent judgment to determine the taxable value of
the subject property. Id. R.C. 5717.05 thus does not mandate
a trial de novo. Selig v. Bd. of Revision, Mahoning Cty., 12
Ohio App.2d 157, 165, 231 N.E.2d 479 (7th Dist.1967). Upon
further appeal to this court, our review is limited to a
determination of whether the court of common pleas abused
its discretion in determining the matter. We will accordingly
not reverse the court of common pleas' judgment unless it is
unreasonable, arbitrary or unconscionable. Tall Pines
Holdings, Ltd. v. Testa, 10th Dist. No. 04AP-372, 2005-Ohio-
2963, ¶ 19.
{¶ 17} In its first assignment of error, appellant contends the common pleas court
erred in determining that appellant is not an aggrieved party. Appellant maintains that it
is an aggrieved party because the BOR's allocation of the entire reduction in value to the
tax-abated portion of the property resulted in no reduction in its tax liability.
{¶ 18} Initially, we note the common pleas court did not expressly aver that
appellant is not an aggrieved party. Rather, the court, after noting both that appellant had
presented no evidence at the BOR hearing that the land value was different than the value
set by the auditor and that the BOR had reduced the aggregate value of the property in
accordance with the request set forth in appellant's complaint, averred only that "it
appears that the appellant is not an aggrieved party and thus, does not present a
No. 13AP-232 7
justiciable issue to this Court." (Emphasis added.) (Feb. 26, 2013 Decision and Entry, 2.)
Moreover, even if the court's statement could be construed in the manner urged by
appellant, such statement was harmless, given the trial court addressed the merits of
appellant's appeal.
{¶ 19} Appellant's first assignment of error is overruled.
B. Second Assignment of Error
{¶ 20} By its second assignment of error, appellant contends the common pleas
court erred by according the BOR's decisions a presumption of validity. Citing Vandalia-
Butler City Schools Bd. of Edn. v. Montgomery Cty. Bd. of Revision, 130 Ohio St.3d 291,
294-95, 2011-Ohio-5078, appellant argues the Supreme Court of Ohio has consistently
held that board of revision decisions are not entitled to a presumption of validity.
{¶ 21} The common pleas court cited the Supreme Court of Ohio's decision in
Cleveland Bd. of Edn. v. Cuyahoga Cty. Bd. of Revision, 68 Ohio St.3d 336 (1994), for the
proposition that, "[a]bsent proof that the action of the BOR was not performed in good
faith and the exercise of sound judgment, the BOR's action in determining the value of
real property for tax purpose[s] must be presumed valid." (Feb. 26, 2013 Decision and
Entry, 2.) In Cleveland Bd. of Edn., the court stated:
Alliance Towers [Ltd. v. Stark Cty. Bd. of Revision, 37 Ohio
St.16 (1988)] does say:
"The taxpayers offered no testimony or evidence that the
action of the board of revision was not performed in good
faith and in the exercise of sound judgment. Absent this
proof, the action of the board of revision must be presumed to
be valid." Alliance Towers, 37 Ohio St.3d at 25, 523 N.E.2d at
834.
In other words, Alliance Towers resolves the issue of whether
the board of revision acted in good faith and exercised sound
judgment, not whether the board of revision's finding of true
value should be presumed to be correct. Roc Syl's appeal does
not present the issue of "good faith" or "sound judgment";
moreover, the BTA found that Roc Syl failed to sustain its
burden of proving that the board of revision's true value
determination was incorrect.
Id. at 337.
No. 13AP-232 8
{¶ 22} Thus, the common pleas court's asserted proposition of law is correct.
Pursuant to Cleveland Bd. of Edn., the action of the BOR was entitled to a presumption of
validity in the absence of evidence that such action was not performed in good faith and
in the exercise of sound judgment. As in Cleveland Bd. of Edn., appellant's appeal does
not present the issue of "good faith" or "sound judgment." Although appellant correctly
contends that the BOR's decisions were not entitled to a presumption of validity, the
common pleas court did not so hold. The court did not find appellant failed to overcome
the presumption of validity of the BOR's findings. To the contrary, the court found
appellant failed to sustain its burden of proving the BOR erred in allocating the entire
reduction in value to the tax-abated portion of the property.
{¶ 23} The second assignment of error is overruled.
C. Third Assignment of Error
{¶ 24} In its third assignment of error, appellant contends the common pleas court
erred in affirming the BOR's allocation of the entire reduction in value to the tax-abated
portion of the property. Appellant maintains the BOR was required to employ a pro rata
allocation of the aggregate sale price based upon the relative value of the taxable and tax-
abated portions of the property pursuant to the auditor's original assessments.
{¶ 25} In support of this argument, appellant relies on FirstCal Indus. 2
Acquisitions, L.L.C. v. Franklin Cty. Bd. of Revision, 125 Ohio St.3d 485, 2010-Ohio-1921.
There, the court considered the allocation of value between otherwise unrelated and non-
continuous parcels, located in different counties, subject to a bulk sale. Under those
circumstances, the court found the pro rata allocation of the aggregate sale price, based
upon the relative value of the parcels pursuant to the auditor's original assessments, was a
reasonable method of determining the value of the individual parcels. The court did not
determine this method was the sole method of valuation. Moreover, the instant case is
distinguishable, as it involves the purchase and sale of a single parcel, a portion of which
is taxable and a portion of which is tax-abated.
{¶ 26} A taxpayer bears the burden of establishing the right to a reduction in value
and is not entitled to its claimed reduction merely because no evidence is adduced contra
its claim. Bd. of Edn. of the Dublin City Schools v. Franklin Cty. Bd. of Revision, __ Ohio
St.3d __, 2013-Ohio-4543, ¶ 14, citing Dayton-Montgomery Cty. Port Auth. v.
No. 13AP-232 9
Montgomery Cty. Bd. of Revision, 113 Ohio St.3d 281, 2007-Ohio-1948, ¶ 15. When a
party appeals a board of revision's decision, the appellant, whether a taxpayer or a board
of education, bears the burden of proving its right to a reduction or increase in the board
of revision's determination of value. Id. at ¶ 15, citing Columbus City School Dist. Bd. of
Edn. v. Franklin Cty. Bd. of Revision, 90 Ohio St.3d 564, 566 (2001). To prevail on
appeal, the appellant must present competent and probative evidence supporting the
value the appellant asserts. Id.
{¶ 27} In this case, appellant bore the burden of proving its right to a reduction in
value when it challenged the auditor's valuation of the property before the BOR. See
Dayton-Montgomery at ¶ 15. To meet this burden, appellant presented competent and
probative evidence establishing the sale of the property for $4,550,000. However,
appellant presented no appraisal or expert testimony supporting its proposed allocation
of the reduction in value between the taxable and tax-abated portions of the property.
Indeed, appellant did not even mention its proposed allocation at the hearing. Appellant's
suggestion that it was appellees' burden to disprove the allocation appellant asserted in its
complaint is unavailing. The allocation appellant asserted in its complaint was merely
appellant's opinion of value; it was not evidence. As noted above, appellant was not
entitled to its claimed allocation merely because appellees presented no contradictory
evidence. Bd. of Edn. of the Dublin City Schools at ¶ 14.
{¶ 28} The third assignment of error is overruled.
D. Fourth Assignment of Error
{¶ 29} By its fourth assignment of error, appellant contends the common pleas
court erred by failing to independently determine the allocation of the reduction in the
value of the property. Appellant correctly asserts R.C. 5717.05 requires a common pleas
court, on appeal from a board of revision adjudication, to independently consider and
weigh the record evidence and apply its independent judgment to determine the taxable
value of the property at issue. See Kaiser at ¶ 9.
{¶ 30} Appellant contends that nothing in the common pleas court's decision
confirms it performed its statutory duty to consider the record evidence in determining
how to allocate the reduced value of the property between the taxable and tax-abated
portions of the property. Appellant maintains the common pleas court did not consider
No. 13AP-232 10
appellant's proffered evidence, i.e., the auditor's existing allocation of value between the
taxable and tax-abated portions of the property.
{¶ 31} Contrary to appellant's assertion, the common pleas court did consider the
auditor's existing allocation of value. Indeed, the court averred that "[a] review of the
record demonstrates that the appellant has presented no evidence that the land value was
different than the value set by the Franklin County Auditor." (Feb. 26, 2013 Decision and
Entry, 2.) The court then discussed the propriety of the BOR's allocation of the entire
reduction in value to the tax-abated portion of the property. In this discussion, the court
noted that the record evidence established the subject property is one tract of land,
divided solely for accounting purposes into taxable and tax-abated portions pursuant to
the CRA agreement. In the absence of evidence proffered by appellant to establish
otherwise, the court found reasonable the BOR's allocation of the entire reduction in value
of the property to the tax-abated portion of the property. Indeed, the court noted that "by
reducing the value of the property, the BOR has reduced the increase in value attributable
to the improvements subject to the CRA. Thus, the BOR first must apply any reduction in
total value to the abated portion of the property before lowering the base taxable value."
(Feb. 26, 2013 Decision and Entry, 3-4.) This discussion and resolution establishes the
court fulfilled its statutory duty to independently consider and weigh the record evidence
and apply its independent judgment to determine the taxable value of the subject
property.
{¶ 32} The fourth assignment of error is overruled.
III. CONCLUSION
{¶ 33} Having overruled all four of appellant's assignments of error, we hereby
affirm the judgment of the Franklin County Court of Common Pleas.
Judgment affirmed.
BROWN and T. BRYANT, JJ., concur.
T. BRYANT, J., retired, formerly of the Third Appellate
District, assigned to active duty under authority of the Ohio
Constitution, Article IV, Section 6(C).
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