The opinion
[Cite as Green Local Schools Bd. of Edn. v. Manolakis, 2019-Ohio-3250.]
STATE OF OHIO ) IN THE COURT OF APPEALS
)ss: NINTH JUDICIAL DISTRICT
COUNTY OF SUMMIT )
GREEN LOCAL SCHOOLS BOARD OF C.A. No. 29196
EDUCATION
Appellee
APPEAL FROM JUDGMENT
and ENTERED IN THE
OHIO BOARD OF TAX APPEALS
SUMMIT COUNTY BOARD OF COUNTY OF SUMMIT, OHIO
REVISION CASE No. 2017-1706
Appellee
v.
STAN MANOLAKIS, et al.
Appellants
DECISION AND JOURNAL ENTRY
Dated: August 14, 2019
CARR, Judge.
{¶1} Appellants Stan and Tiffany Manolakis appeal from the decision of the Ohio
Board of Tax appeals (“the BTA”). This Court affirms.
I.
{¶2} At the end of 2015, Mr. and Mrs. Manolakis purchased a home on Arlington Road
in North Canton via an online auction. They paid $800,000 plus additional fees for a total of
$836,299.00. The auditor assigned the property a value of $1,498,350 for 2016.
{¶3} In February 2017, Mr. and Mrs. Manolakis filed a complaint against the valuation
of real property with the Summit County Board of Revision (“the BOR”) seeking a decrease in
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value to $800,000 based upon their recent purchase. Appellee Green Local School District
Board of Education (“Green”) filed a counter complaint seeking to maintain the value assigned
by the auditor.
{¶4} The matter proceeded to a hearing before the BOR at which Mr. Manolakis
testified. The BOR concluded that a decrease in valuation was warranted and valued the
property at $836,300 for the 2016 tax year.
{¶5} Green appealed to the BTA arguing that the auditor’s value should be reinstated
because Mr. and Mrs. Manolakis failed to meet their burden in the BOR to demonstrate that the
sale was an arm’s-length transaction. Absent such evidence, Green argued that the sales price
could not be considered the best evidence of value. The parties waived a hearing. While the
parties attached documents to their briefs in the BTA, the BTA refused to consider them as the
parties had “waiv[ed] the opportunity to supplement the record with new evidence at the [BTA]
hearing.”
{¶6} The BTA concluded that Mr. and Mrs. Manolakis failed to demonstrate that their
purchase of the property for $836,299 was an arm’s-length transaction. Ultimately, the BTA
concluded that “the evidence submitted at the BOR hearing was insufficient, and, therefore, the
BOR’s decision to reduce the subject property’s value to reflect the auction sale price is
unsupported.” Further, “[b]ecause there [wa]s no other evidence of value contained in the
record,” the BTA was “constrained to reinstate the subject property’s initially assessed value.”
{¶7} Mr. and Mrs. Manolakis have appealed, raising four assignments of error for our
review. They will be addressed together to facilitate the discussion of the relevant issues.
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II.
ASSIGNMENT OF ERROR I
IT WAS UNREASONABLE OR UNLAWFUL FOR THE OHIO BOARD OF
TAX APPEALS (BTA) TO REVERSE THE SUMMIT COUNTY BOARD OF
REVISION (BOR) (APPENDIX A) DETERMINATION THAT THE FAIR
MARKET VALUE OF THE SUBJECT PROPERTY IS $836,300 AS OF THE
STATUTORY VALUATION DATE OF JANUARY 1, 2016 WHEN ALL OF
THE EVIDENCE PROVES THAT IS THE TRUE VALUE OF THE SUBJECT
PROPERTY, INCLUDING THAT WAS THE PRICE WHICH STAN AND
TIFFANY MANOLAKIS (MANOLAKIS) PAID FOR THE PROPERTY LESS
THAN TWO MONTHS BEFORE THE STATUTORY VALUATION DATE AT
A PUBLIC AUCTION SALE OF THE SUBJECT PROPERTY WHICH WAS A
VOLUNTARY SALE AT ARM’S LENGTH AND NOT A FORCED OR
FORECLOSURE SALE OF THE PROPERTY.
ASSIGNMENT OF ERROR II
IT WAS UNREASONABLE OR UNLAWFUL FOR THE BTA TO
EFFECTIVELY SHIFT THE BURDEN OF PROOF TO MANOLAKIS
DURING THE PROCEEDINGS BEFORE THE BTA WHEN MANOLAKIS
WAS NOT THE APPELLANT BEFORE THE BTA.
ASSIGNMENT OF ERROR III
ASSUMING THAT THE BURDEN OF PROOF ON APPEAL TO THE BTA
HAD TO BE BORNE BY MANOLAKIS (WHICH IS DENIED), IT WAS
UNREASONABLE OR UNLAWFUL TO FIND THAT MANOLAKIS DID
NOT MEET THAT BURDEN OF PROOF.
ASSIGNMENT OF ERROR IV
IT WAS UNREASONABLE OR UNLAWFUL FOR THE BTA TO FIND THAT
THE GREEN LOCAL SCHOOLS BOARD OF EDUCATION (GREEN)
CARRIED ITS BURDEN OF PROOF AS APPELLANT BEFORE THE BTA
WHEN GREEN OFFERED NO COMPETENT AND PROBATIVE EVIDENCE
BEFORE EITHER THE BTA OR THE SUMMIT COUNTY BOR TO
SUPPORT THE $1,498,350 VALUATION IT WAS ADVOCATING.
{¶8} Mr. and Mrs. Manolakis in their four assignments of error challenge the BTA’s
decision to reverse the ruling of the BOR and reinstate the value assigned by the auditor. They
argue in their first assignment of error that the evidence supports the BOR’s determination of
value. In their second assignment of error, they assert that the BTA improperly shifted the
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burden of proof to them. Mr. and Mrs. Manolakis allege in their third assignment of error that,
assuming it was proper to shift the burden to them, they met their burden. Finally, in their fourth
assignment of error, they argue that Green failed to meet its burden to establish the $1,498,350
valuation.
{¶9} “We review BTA decisions only to determine whether they are ‘reasonable and
lawful.’ R.C. 5717.04. The court will defer to the BTA’s factual findings, including
determinations of a property’s value, as long as they are supported by ‘reliable and probative’
evidence in the record.” Olentangy Local Schools Bd. of Edn. v. Delaware Cty. Bd. of Revision,
141 Ohio St.3d 243, 2014-Ohio-4723, ¶ 21. “The BTA’s legal determinations, however, are
subject to de novo review.” Id.
{¶10} R.C. 5713.03 provides in relevant part that, “[i]n determining the true value of
any tract, lot, or parcel of real estate under this section, if such tract, lot, or parcel has been the
subject of an arm’s length sale between a willing seller and a willing buyer within a reasonable
length of time, either before or after the tax lien date, the auditor may consider the sale price of
such tract, lot, or parcel to be the true value for taxation purposes.” Nonetheless, R.C. 5713.04
states in pertinent part that “[t]he price for which such real property would sell at auction or
forced sale shall not be taken as the criterion of its value.” The Supreme Court of Ohio has
determined that the word “auction” in R.C. 5713.04 includes both voluntary and involuntary
auctions. Olentangy Local Schools Bd. of Edn. at ¶ 27. “Olentangy Local Schools [Bd. of Edn.]
made clear for the first time that all auction sales give rise to a presumption against using the sale
price as the property’s value, subject to rebuttal if the proponent proves the voluntary and arm’s-
length character of the sale.” Julia Realty, Ltd. v. Cuyahoga Cty. Bd. of Revision, 153 Ohio St.3d
262, 2018-Ohio-2415, ¶ 16. Thus, “the sale prices of parcels sold at auction are nevertheless the
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best evidence of value when all of the elements of an arm’s-length transaction are present.”
Olentangy Local Schools Bd. of Edn. at ¶ 39.
{¶11} Under such circumstances, “the opponent of a sale price has a very light burden to
establish that a transaction was on its face an auction or a forced sale. Once that threshold is
crossed, then the proponent of the sale price bears the burden to prove that the sale was
nevertheless an arm’s-length transaction between typically motivated parties and should
therefore be regarded as the best evidence of the property’s value.” Id. at ¶ 43. “Whether a
transaction occurred at arm’s length depends on whether the sale was voluntary, whether it took
place on the open market, and whether the parties acted in their own self-interest.” North Canton
City School Dist. Bd. of Edn. v. Stark Cty. Bd. of Revision, 152 Ohio St.3d 292, 2018-Ohio-1, ¶
17.
{¶12} As the appellant before the BTA, Green “bore the burden to prove its right to an
increase in the value determined by the BOR.” Id. at ¶ 15. To do so, Green argued in the BTA
that the evidence was insufficient to establish that the transaction was at arm’s length. Given the
foregoing, we cannot say that the BTA’s reference to Mr. and Mrs. Manolakis having a burden
was improper. The BTA was reviewing the BOR decision and it was Green’s argument that Mr.
and Mrs. Manolakis failed to meet their burden in the BOR. See Olentangy Local Schools Bd. of
Edn. v. Delaware Cty. Bd. of Revision, 152 Ohio St.3d 331, 2017-Ohio-8843, ¶ 9 (“The BOE had
the burden of proof as the appellant before the BTA, and sought to meet its burden by attacking
the competence and probative value of the evidence Columbus Pike had presented to the BOR.
The BOE thus argued that Columbus Pike, as the party seeking to decrease the auditor’s
valuation, did not meet its burden to prove a lower value to the BOR. Indeed, if Columbus Pike
had failed to meet its burden with competent and probative evidence at the BOR, the BTA was
6
required to reverse the BOR’s reduction in value. In assessing Columbus Pike’s evidence, the
BTA could not defer to the BOR’s factual findings; it had to independently weigh and evaluate
all evidence properly before it.”) (Internal citations and quotations omitted.) In their brief, Mr.
and Mrs. Manolakis acknowledge that they had the burden of proof at the BOR.
{¶13} At the hearing before the BOR, Mr. Manolakis testified that approximately two
years prior to his and his wife’s purchase of the property, it had been listed for sale but did not
sell. In the summer of 2015, the property went up for Sheriff’s sale but Mr. Manolakis did not
make it to the Sheriff’s sale. The record reflects that the property sold for $800,000, which Mr.
Manolakis testified was the minimum bid at the sheriff’s sale. Mr. Manolakis testified that he
thought he heard that the bank had bought the property at the sheriff’s sale.
{¶14} Sometime after, Mr. Manolakis and his wife noticed a Hubzu sign in the front
yard of the property. When they returned home, they looked at the Hubzu online auction website
and saw the property posted on the website. Mr. Manolakis had never been on the website
before that time. They noticed that the property was going up for auction in about a week’s time
or less and so took the steps necessary to become a qualified bidder. Mr. Manolakis testified that
the auction did not allow participants to bid against one another, and instead, participants had to
submit their final and best offer. Mr. Manolakis and his wife submitted a bid of $800,000. The
offer was accepted. Mr. Manolakis testified that the seller did not have to accept the offer but
documents detailing the auction process were not admitted into evidence. Mr. Manolakis
believed that he and his wife were the highest bidders. At the time of bidding, he did not know
whether they were the only bidder; however, he later came to learn that they may have been the
only bidder. Mr. Manolakis was unaware of what efforts were made to sell the property between
the sheriff’s sale and the auction.
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{¶15} A copy of the purchase agreement was submitted as an exhibit. The purchase
agreement lists Ocwen Loan Servicing, LLC as the seller; however, the property card, also in the
record, lists “Wells Fargo Bank Trustee” as the grantor and describes the sale as
“Mortgage/Lender[.]” Mr. Manolakis testified that neither he nor his wife had any relationship
to Ocwen Loan Servicing, LLC nor did they know anyone at the company. Mr. Manolakis
maintained over objection that the transaction was an arm’s-length transaction, was voluntary,
and that the price they paid was an accurate reflection of the value of the property. To Mr.
Manolakis’ knowledge neither side was compelled to enter into the transaction.
{¶16} The purchase price in the purchase agreement is stated as $800,000, but after fees
were added, the total paid by Mr. and Mrs. Manolakis for the property was $836,299. The
purchase agreement also lists a listing broker and a selling broker or buyer’s agent.
{¶17} Mr. Manolakis and his wife were not able to see the property before the sale, but
when they did see it Mr. Manolakis was pleasantly surprised to find that it was in move-in
condition. Later, in August 2016, Mr. Manolakis listed the property for sale for $1,895,00 and
dropped the price to $1,750,00, but did not get any offers on the property. At the time of the
BOR hearing, the property was not listed for sale.
{¶18} While an exhibit of an MLS listing of the property was presented at the hearing
over objection, Mr. Manolakis testified that he had not seen that listing before he and his wife
purchased the property.1 The listing was printed the day of the BOR hearing. The listing
indicates the list price of the property was $853,000 and that the property sold for $800,000 with
a closing date of November 2015. Mr. Manolakis did not know whether the property was
1
Green argues that this evidence should not be considered as it is hearsay. However, we
note that “the Rules of Evidence do not strictly apply in administrative tax proceedings[.]” Lunn
v. Lorain Cty. Bd. of Revision, 149 Ohio St.3d 137, 2016-Ohio-8075, ¶ 15.
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actually ever listed at $853,000. The listing does not indicate when it was first posted or even
whether it was posted prior to the sale.
{¶19} On appeal, Mr. and Mrs. Manolakis additionally point to the purchase agreement
in support of their argument that the sale was an arm’s-length transaction. They assert that the
“contract documents make it clear that the seller was free to exit the transaction at any time if
someone was going to pay more.”
{¶20} The first page of the contract states “[u]ntil the Seller receives the Agreement,
executed by you, along with a photocopy of the Earnest Money funds, and signs and returns to
you a copy of the executed Agreement, there will be no binding contract between the parties, and
the Seller will have no obligation to move forward with the contemplated sale. Therefore, until
this happens, the Seller will continue to market the Property, negotiate and accept other offers on
the Property. Further, at all times, even after there is a binding contract, the Seller reserves the
right to continue to market the Property and accept backup offers on the Property.” Another
provision provides that “Seller reserves the right to continue to offer the Property for sale to
others after Buyer’s delivery of this Agreement and/or Seller’s acceptance of the Buyer’s offer
and accept backup offers at Seller’s sole discretion.”
{¶21} However, even assuming this language means what Mr. and Mrs. Manolakis
believe it does, they did not demonstrate that the property was in fact marketed after their offer
was accepted or that any backup offers were accepted. Instead, Mr. Manolakis testified that he
had learned that their bid may have been the only bid.
{¶22} The Supreme Court has concluded the presence of certain “open-market elements
definitely militates in favor of finding a transaction to have been at arm’s length.” See
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Olentangy Local Schools Bd. of Edn., 141 Ohio St.3d 243, 2014-Ohio-4723, at ¶ 51. In
Olentangy Local Schools Bd. of Edn., the facts were such that
[t]he MLS listing confirm[ed] that Countrywide listed the property on the open
market for nine months before the auction. In addition, [the] testimony
indicate[d] that the auction was publicly advertised for a significant period of
time, it was well attended, and there were multiple bidders for the property. The
highest bid was 92 percent of the property’s final MLS list price. Countrywide
accepted this bid, although it had retained the right to reject it.
Id.
{¶23} Notwithstanding the presence of those facts, the Supreme Court concluded that
“the BTA could reasonably have concluded that Countrywide acted under duress and was not a
typically motivated seller. But the record also contains sufficient evidence to support the BTA’s
contrary conclusion.” Id. at ¶ 52.
{¶24} While Mr. Manolakis testified in a conclusory fashion that the sale was at arm’s
length, voluntary, and neither side was forced to enter the transaction, the BTA could have
reasonably found that evidence insufficient given the lack of evidence to support those claims. It
is true that Mr. and Mrs. Manolakis presented an MLS listing of the property to support their
position. However, that listing was printed on the day of the BOR hearing and there was no
evidence as to when it was created or even whether that listing existed at the time the property
was up for auction. Instead, the listing indicates the property was sold for $800,000, the sale
closed in November 2015, and the property was not available for auction.
{¶25} From Mr. Manolakis’ testimony, all that can be said for sure is that about a week
before the auction, there was a sign in the front yard of the property and at that time the property
was listed on Hubzu. It is not clear what, if any, other marketing efforts were done. It is also
unclear whether there was a minimum bid for the auction. After the auction, Mr. Manolakis
learned he may have been the only bidder.
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{¶26} Given the record before us, we conclude that the decision of the BTA determining
that Mr. and Mrs. Manolakis failed to sufficiently demonstrate that the online auction was an
arm’s-length transaction was reasonable and lawful. See R.C. 5717.04.
{¶27} Finally, Mr. and Mrs. Manolakis argue that Green failed to submit evidence to
support the value it advocated. In essence, Mr. and Mrs. Manolakis argue that the so-called
Bedford Rule applied to the instant matter. “The Bedford rule provides that the BTA generally
may not rely on the auditor’s original valuation as a default valuation when the board of revision
has reduced the property’s value based on the owner’s evidence. When it applies, the rule
requires a board of education to go forward with evidence on appeal to the BTA.” (Internal
citations omitted.) Olentangy Local Schools Bd. of Edn., 152 Ohio St.3d 331, 2017-Ohio-8843,
at ¶ 22. “[T]he Bedford rule applies only when the evidence of value that the owner presented to
the board of revision was competent and at least minimally plausible.” (Internal quotations and
citation omitted.) Id. at ¶ 23. In addition, for the Bedford rule to apply, “the board of revision’s
reduction in value must have been based on appraisal evidence, not a sale price.” Huber Heights
City Schools Bd. of Edn. v. Montgomery Cty. Bd. of Revision, 154 Ohio St.3d 332, 2018-Ohio-
4284, ¶ 13. “In the absence of probative evidence of a lower value, a county board of revision
and the BTA are justified in fixing the value at the amount assessed by the county auditor.”
(Internal quotations and citations omitted.) Vandalia-Butler City School Dist. Bd. of Edn. v.
Montgomery Cty. Bd. of Revision, 106 Ohio St.3d 157, 2005-Ohio-4385, ¶ 12; see also South-
Western City School Bd. of Edn v. Franklin Cty. Bd. of Revision, 152 Ohio St.3d 548, 2018-
Ohio-919, ¶ 21 (noting that “[e]ven if some evidence tends to negate the auditor’s original
valuation, it is proper to revert to that valuation when the BTA finds that the owner has not
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proved a lower value and there is otherwise no evidence from which the BTA can independently
determine value”) (Internal quotations, emphasis and citations omitted.).
{¶28} Here, in light of our determination above, we cannot say that the BTA was
unreasonable in concluding that the evidence of value presented by Mr. and Mrs. Manolakis to
the BOR was not sufficient. Moreover, given the record before it, the BTA rejected the notion
that the previous $800,000 sale of the property at sheriff’s sale could be indicative of the
property’s value. Mr. and Mrs. Manolakis have not challenged that conclusion on appeal, and
acknowledge that they “never suggested that the foreclosure sale price justified the reduction
they were seeking.” Accordingly, given the lack of evidence in the record to support a lower
value, or any value, we conclude that is was reasonable and lawful for the BTA to adopt the
auditor’s valuation of the property.
{¶29} Mr. and Mrs. Manolakis’ assignments of error are overruled.
III.
{¶30} Mr. and Mrs. Manolakis’ assignments of error are overruled. The decision of the
BTA is affirmed.
Decision affirmed.
There were reasonable grounds for this appeal.
We order that a special mandate issue out of this Court, directing the Ohio Board of Tax
Appeals, County of Summit, State of Ohio, to carry this judgment into execution. A certified
copy of this journal entry shall constitute the mandate, pursuant to App.R. 27.
Immediately upon the filing hereof, this document shall constitute the journal entry of
judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the
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period for review shall begin to run. App.R. 22(C). The Clerk of the Court of Appeals is
instructed to mail a notice of entry of this judgment to the parties and to make a notation of the
mailing in the docket, pursuant to App.R. 30.
Costs taxed to Appellants.
DONNA J. CARR
FOR THE COURT
TEODOSIO, P. J.
HENSAL, J.
CONCUR.
APPEARANCES:
MATTHEW YACKSHAW, and JOSHUA A. LEMERMAN, Attorneys at Law, for Appellants.
ROBERT M. MORROW, Attorney at Law, for Appellee.
MARY JO SHANNON SLICK, Attorney at Law, for Appellee.
TIMOTHY J. WALSH, Attorney at Law, for Appellee.