The opinion
Filed 5/23/23
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION SEVEN
RAR2 VILLA MARINA B315898
CENTER CA SPE, INC. et al.,
(Los Angeles County Super.
Plaintiffs and Appellants, Ct. No. 20STCV21214)
v.
COUNTY OF LOS ANGELES,
Defendant and
Respondent.
APPEAL from a judgment of the Superior Court of Los
Angeles County, Patricia D. Nieto and Kristin S. Escalante,
Judges. Affirmed.
Greenberg Traurig, Ruben Sislyan, and Cris K. O’Neall for
Plaintiffs and Appellants.
Dawyn Harrison, County Counsel, Peter Bollinger,
Assistant County Counsel, and Drew M. Taylor, Deputy County
Counsel, for Defendant and Respondent.
_________________
This appeal provides a cautionary tale of how a property
owner’s challenge to a county assessor’s valuation of the owner’s
property can result in the assessor recommending—and an
appeals board adopting after a hearing—a valuation higher than
the initial valuation. Unfair as this may seem, the assessor and
the appeals board have a duty to the property owner and the
taxpayers to correctly assess the value of property. As long as
the assessor provides notice to the property owner of the
assessor’s intent to present evidence of a higher valuation at the
appeals board hearing, the statutory scheme vests the appeals
board with the authority (and the obligation) to determine the
full value of the property, after considering evidence submitted
by the assessor and the property owner, even if that value is
higher than the initial valuation.
RAR2 Villa Marina Center CA SPE, Inc., RAR2-Villa
Marina Center CA, LLC, and Villa Marina Company, LLC
(collectively, Villa entities) appeal from a judgment entered in
this property tax refund action after the trial court sustained the
demurrer filed by the County of Los Angeles (County) without
leave to amend and denied the Villa entities’ summary judgment
motion, upholding the decision of the Los Angeles County
Assessment Appeals Board (Board) concerning the 2011
valuation of a shopping center owned by the Villa entities.
In 2006 the Villa entities purchased the shopping center,
located in the Marina del Rey area of the County, for $100
million. In 2011 the Los Angeles County Assessor’s Office
(Assessor) determined the value of the shopping center had
decreased, setting the assessment roll value (roll value) at
approximately $94 million. The Villa entities filed an assessment
appeal with the Board seeking a further reduction of the assessed
2
value to $48 million. The Villa entities agreed to multiple
postponements of the Board hearing, ultimately to August 9,
2019.
During the pendency of the assessment appeal, the
Assessor issued three “raise letters” advising the Villa entities of
the Assessor’s intent to introduce evidence at the Board hearing
to support an increase in the shopping center’s 2011 roll value to
approximately $113 million. In response, the Villa entities
requested they be allowed to withdraw their application,
accepting the initial valuation. The Board rejected the
withdrawal request, and, following the 2019 hearing, the Board
determined the shopping center’s 2011 roll value should be
increased to the value requested by the Assessor.
On appeal, the Villa entities contend the Assessor had no
authority to issue a raise letter recommending an increase in the
property’s valuation more than one year after the initial
assessment because Revenue and Tax Code section 4831,
subdivision (c),1 required that any correction to the initial
assessment be made within one year if the error “arises solely
from a failure to reflect a decline in the taxable value of real
property.” According to the Villa entities, because the Assessor
issued the raise letters after the original decline-in-value
assessment in 2011, the raise letters constituted a roll correction
subject to the one-year limitations period under section 4831,
subdivision (c).
Contrary to the Villa entities’ argument, a raise letter
issued under section 1609.4 providing notice, in the context of an
1 Further undesignated statutory references are to the
Revenue and Tax Code.
3
assessment appeal, that the assessor recommends a higher
valuation than the roll value is not properly characterized as a
proposal by the assessor to correct the roll value to reflect a
decline in the property’s value, even if the initial assessment
reflected a decline in value, and therefore, the one-year
limitations period under section 4731, subdivision (c), does not
apply. We recognize that if the Villa entities had not challenged
the initial valuation, they would not have suffered an increase in
the valuation for that year. But once they filed an appeal of the
initial valuation, the assessment appeals process opened the door
to a determination by the Board of the correct value—higher or
lower. The Villa entities have not shown error in the Board’s
conclusion the correct value was significantly higher than the
initial valuation.
We also reject the Villa entities’ argument that laches
barred the Assessor from recommending to the Board a higher
assessed value because the Assessor did not make his final
recommendation until seven years after the Villa entities
submitted their application requesting a reduction of the
shopping center’s value for 2011. The Villa entities’ agreement to
multiple continuances of the hearing date is fatal to their
challenge. Further, although they were unable to cross-examine
the initial appraiser (who had died since preparing his appraisal
report), the Villa entities were able to question the new appraiser
who testified at the hearing, and they have failed to show any
prejudice.
We agree with the County that the Board carried out its
statutory duty in adopting the higher valuation for the property.
We affirm.
4
FACTUAL AND PROCEDURAL BACKGROUND
A. The Initial Assessment and Assessment Appeal
The Villa entities purchased the shopping center on June
28, 2006 for $100 million. On July 6, 2011 the Assessor made a
“[d]ecline in [v]alue” assessment of $94,470,000 as the shopping
center’s roll value for the 2011-2012 tax year. On November 28,
2011 the Villa entities filed an application for changed
assessment with the Board, seeking a reduction of the shopping
center’s roll value to $48 million and a refund of property taxes
paid for the 2011-2012 tax year.
The Board hearing was set for February 12, 2013, but the
Villa entities and the Assessor agreed to postpone the hearing to
resolve whether certain property parcels should be valued
together for the assessment.2 On February 12, 2013 the Villa
entities submitted a waiver and agreement for postponement of
the Board hearing.3 The Board granted the postponement
request and rescheduled the hearing for February 4, 2014.
On September 19, 2013 the Assessor issued a raise letter
pursuant to section 1609.4, advising the Villa entities of the
Assessor’s intent to recommend an increase in the shopping
center’s assessed value at the February 4, 2014 hearing.
Section 1609.4 provides that at a Board hearing on an
application, “[t]he assessor may introduce new evidence of full
2 The shopping center is situated on seven property parcels
with separate parcel numbers.
3 The Villa entities waived their right to have their
“application heard and decided by the Assessment Appeal Board
within a two-year period from the date of the filing as set forth by
subdivision (c) of Section 1604.”
5
cash value of a parcel of property at the hearing . . . .” However,
“[i]f the assessor proposes to introduce evidence to support a
higher assessed value than he placed on the roll, he shall, at least
10 days prior to the hearing, inform the applicant of the higher
assessed value and the evidence proposed to be introduced and he
may thereafter introduce such evidence at the hearing.” (Ibid.)
On January 9, 2014 the Assessor issued a second raise
letter with supporting documentation, including an appraisal
report prepared by appraiser Tom Partaker. The raise letter
notified the Villa entities of the Assessor’s intent to recommend
an increase in the shopping center’s roll value at the February 4,
2014 hearing to $112,545,441. At the February 4, 2014 hearing,
the Villa entities submitted a waiver and agreement for
postponement of the hearing, again waiving their right to have
their application heard and decided by the Board within two
years from the date of filing as provided under section 1604,
subdivision (c). The Board granted the postponement request
and continued the hearing to October 31, 2018.
B. The Villa Entities’ Application Withdrawal Request
At the outset of the October 31, 2018 hearing, the Villa
entities submitted a request to withdraw their application, which
would maintain the 2011 roll value at $94,470,000. The Assessor
opposed the request, arguing the Villa entities could not
withdraw their application because the request was made after
the Assessor issued the raise letters in advance of the February
4, 2014 hearing. Therefore, the Assessor asserted, under Appeals
Board Rules 14.H and 14.I, adopted June 29, 2010 (Board
6
Rules 14.H and Rule 14.I),4 the Villa entities could only withdraw
their application upon the written consent of the Assessor, which
the Assessor declined to give. The Villa entities argued, inter
alia, that the Board should allow the withdrawal in light of the
Assessor’s failure to submit a timely raise letter prior to the
initial scheduled hearing on February 12, 2013.
After a hearing, on January 25, 2019 the Board denied the
Villa entities’ request to withdraw their application. The Board
found article XIII, section 16 of the California Constitution5
4 Board Rule 14.H provides in part, “If the assessor requests
that the board increase the assessed value and proposes to
introduce evidence to support a higher assessed value than that
placed on the roll, the assessor shall, at least ten (10) days prior
the hearing, give notice in writing to the applicant or the
applicant’s authorized representative of the higher assessed
value and the evidence proposed to be introduced. The assessor
may thereafter introduce such evidence at the hearing, and shall
present his or her case first unless the applicant has failed to
supply all information by law to the assessor.” Board Rule 14.I
provides, “Upon written request signed by the applicant or
applicant’s authorized representative, an application may be
withdrawn at any time prior to or at the time of the hearing.
However, if the assessor has given written notice pursuant to
subdivision H of this rule, and a copy of such notice has been filed
by the assessor with the clerk[, t]hereafter, a withdrawal of the
application may only be effected upon written stipulation by the
applicant or applicant’s authorized representative, and the
assessor.” (Italics added.)
5 Article XIII, section 16 of the California Constitution
provides in part, “County boards of supervisors shall . . . adopt
rules of notice and procedures for those boards as may be
required to facilitate their work and to ensure uniformity in the
7
authorized the County Board of Supervisors to adopt rules of
notice and procedures for the Board, and Board Rule 14.I was
valid because it did not conflict with the Constitution or any
statute or regulation. Further, the Villa entities had a right to
withdraw their application prior to submission of the Assessor’s
raise letters without the Assessor’s consent, but they waited until
after the raise letters were issued. In addition, the Villa entities
were not denied a fair hearing because they were allowed to
present evidence on their withdrawal request at the October 13,
2018 hearing. The Board also found that because the Villa
entities requested a continuance of the February 12, 2013
hearing and executed a two-year waiver under section 1604,
subdivision (c), they could not complain “that the Assessor took
advantage of the extra time afforded by the continuance to issue
the ‘raise letter.’”
C. The Board Hearing on Valuation
The Board subsequently set a hearing on the shopping
center’s valuation for August 9, 2019. On July 24, 2019 the
Assessor issued a third raise letter, again informing the Villa
entities of the Assessor’s intent to recommend at the hearing an
increase in the shopping center’s assessed value from $94,470,000
to $112,545,441. The July 24, 2019 raise letter was accompanied
by Partaker’s July 1, 2013 appraisal report with supporting
documentation.
Appraiser Deborah Grossman testified at the hearing on
behalf of the Assessor because Partaker had passed away. In her
processing and decision of equalization petitions, and may
provide for their discontinuance.”
8
testimony, Grossman relied on Partaker’s 2013 appraisal report.
Grossman testified the shopping center’s roll value in 2011 was
$126,660,000 (above the proposed roll value of $112,545,441).
Grossman considered the market rent per square foot, vacancy
rate, expense ratio, and capitalization rate for triple net leases6 of
the retail spaces based on the size of the space (above or below
2,000 square feet) and the type of tenants (movie theater, grocery
store, drug store, and food and non-food services). Sean Kelley,
the authorized agent for the Villa entities, questioned Grossman
about her calculations.
Kelley relied on the data used by the Assessor, but he
testified higher numbers should have been used for the vacancy
rate, expense ratio, and capitalization rate, and lower market
rent numbers should have been used for most of the retail spaces.
He also provided other modified calculations to support his
valuation. Kelley testified that, based on his calculations, the
shopping center’s value was $93,700,000, which supported the
2011 roll value of $94,470,000.
On December 9, 2019 the Board issued its decision and
findings of fact, finding the Assessor proved by a preponderance
of the evidence the higher assessment it recommended in its raise
6 Under a triple-net lease, “the lessee pays a property’s
operation and maintenance costs including taxes, utilities, and
insurance.” (Munoz v. Patel (2022) 81 Cal.App.5th 761, 767.)
The Assessor calculated the capitalization rate pursuant to
California Code of Regulations, title 18, section 8,
subdivision (g)(1), which provides that the capitalization rate
may be developed “[b]y comparing the net incomes that could
reasonably have been anticipated from recently sold comparable
properties with their sales prices, adjusted, if necessary, to cash
equivalents . . . .”
9
letters. The Board adopted the Assessor’s vacancy rate, rent loss
adjustment, expense ratio, and most of the market rent numbers.
The Board applied a 5.95 percent capitalization rate, which was
lower than the Villa entities’ 6 percent capitalization rate but
higher than the Assessor’s 5.75 percent capitalization rate. The
Board calculated the net operating income, applied the 5.95
percent capitalization rate, deducted the rent loss adjustment,
and concluded the shopping center’s value was $113,585,941.
Because the Board’s valuation of the shopping center was higher
than the adjusted base-year value, the Board found the adjusted
base-year value of $112,545,441 should be the 2011 roll value.
D. The Villa Entities’ Complaint
On June 5, 2020 the Villa entities commenced this action
against the County. In their second amended verified complaint,
the Villa entities asserted a single cause of action for refund of
property taxes pursuant to section 5140,7 alleging the Board
erroneously relied on Board Rule 14.I to deny their request to
withdraw their application for a reduction in the assessed value;
the Assessor’s raise letters were untimely under sections 1609.4
and 4831, subdivision (c), as well as Board Rule 14.H; and the
Board erred in relying on the Assessor’s evidence of a higher
assessed value than the roll value. The second amended
complaint also asserted that the raise letters were untimely
7 Section 5140 provides, “The person who paid the
tax . . . may bring an action . . . against a county or a city to
recover a tax which the board of supervisors of the county or the
city council of the city has refused to refund on a claim filed
pursuant to Article 1 (commencing with Section 5096) of this
chapter.”
10
under property tax rules promulgated by the California State
Board of Equalization.
E. The County’s Demurrer
On December 4, 2020 the County filed a demurrer to the
second amended verified complaint. The County argued the one-
year limitations period in section 4831, subdivision (c), did not
apply to the raise letters (only to a decline in taxable value); the
raise letters were not untimely under section 1609.4, State Board
of Equalization Property Tax Rule 313, subdivision (f) (Cal. Code
of Regs., tit. 18, § 313 (Property Tax Rule 313), subd. (f)),8 or
Board Rule 14.H; and the Assessor did not have a duty to issue a
new raise letter for the October 31, 2018 hearing.
In their opposition, the Villa entities argued the one-year
limitations period under section 4831, subdivision (c), applied to
the raise letters because the 2011 assessment was a decline-in-
value assessment that triggered the limitations period. Further,
the raise letters were untimely because they were not issued at
least 10 days prior to the first scheduled Board hearing set for
February 12, 2013, or before the October 31, 2018 hearing, as
required under section 1609.4. Finally, they argued the
Assessor’s request to increase the property’s assessed value was
barred by the doctrine of laches because the Assessor waited
seven years after the filing of the appeal to propose a higher
valuation.
8 Property Tax Rule 313, subdivision (f), requires the
Assessor to provide 10 days’ notice of a proposed higher assessed
value (a raise letter) in the context of an assessment appeal and
governs the burden of proof at the hearing.
11
F. The Villa Entities’ Motion for Summary Judgment
On March 15, 2021 the Villa entities moved for summary
judgment, asserting the same arguments they presented in their
opposition to the demurrer, including that the raise letters were
untimely. In addition, the Villa entities argued that because the
raise letters were untimely, the Board erred in denying their
request to withdraw their application for a reduction in
valuation.
G. The Trial Court’s Ruling
After a hearing on June 18, 2021, the trial court9 denied
the Villa entities’ summary judgment motion and sustained the
County’s demurrer without leave to amend. The court found that
under Board Rule 14.I, because the Assessor had issued a raise
letter, the Villa entities could only withdraw their application
with the Assessor’s consent, which the Assessor declined to give.
The court found further, “The Assessor’s recommendation to
increase a previously granted ‘decline-in-value’ is not a ‘failure to
reflect’ a decline in value. Therefore, on its face, section 4831(c)
does not apply and cannot provide relief here.” The court also
held section 1609.4 did not require the Assessor to issue a raise
letter prior to the first scheduled Board hearing or for each later
hearing. Finally, the court rejected the Villa entities’ laches
argument.
On July 23, 2021 the trial court10 entered judgment for the
County against the Villa entities and, based on its order
sustaining the demurrer without leave to amend, dismissed the
9 Judge Patricia D. Nieto.
10 Judge Kristin S. Escalante.
12
case under Code of Civil Procedure section 581, subdivision (f)(1).
The Villa entities timely appealed.
DISCUSSION
A. Real Property Assessment Under Propositions 8 and 13
Article XIII, section 1 of the California Constitution states
in part, “All property is taxable and shall be assessed at the same
percentage of fair market value. When a value standard other
than fair market value is prescribed by this Constitution or by
statute authorized by this Constitution, the same percentage
shall be applied to determine the assessed value.” (Cal. Const.,
art. XIII, § 1, subd. (a).) “Proposition 13, an initiative measure
enacted in June 1978, added article XIII A to the California
Constitution and changed the taxation of real property by
replacing ‘the fair market valuation standard with that of
acquisition value.’ [Citation.] Article XIII A, section 2 provides
that all real property, except for property acquired prior to 1975,
shall be assessed and taxed at its value on the date of acquisition,
subject to a 2 percent maximum annual inflationary increase.
[Citation.] This is sometimes referred to as the indexed or
adjusted base year value.” (Western States Petroleum Assn. v.
Board of Equalization (2013) 57 Cal.4th 401, 409 (Western
States); accord, City and County of San Francisco v. County of
San Mateo (1995) 10 Cal.4th 554, 561 [“Article XIII A limits both
the valuation of real property for tax purposes and the maximum
tax rate that can be imposed on the resulting real property
valuation.”].)
Because Proposition 13 only governs assessment and
taxation of real property that appreciates in value, in November
13
1978 California voters passed Proposition 8 to address how real
property should be assessed and taxed when the property
declines in value. (Western States, supra, 57 Cal.4th at pp. 409-
410.) Proposition 8 amended article XIII A to read, “The full cash
value base may reflect from year to year the inflationary rate not
to exceed 2 percent for any given year or reduction as shown in
the consumer price index or comparable data for the area under
taxing jurisdiction, or may be reduced to reflect substantial
damage, destruction, or other factors causing a decline in value.”
(Cal. Const., art. XIII A, § 2, subd. (b).) Thus, “when the value of
real property declines to a level below its adjusted base year
value under Proposition 13, the value of the property is
determined according to its actual fair market value.” (Western
States, at p. 410.)
Following enactment of Proposition 8, the Legislature
formed a task force to study implementation of the new tax
system under Propositions 13 and 8. (Western States, supra,
57 Cal.4th at p. 410.) Based on the recommendations of the task
force, the Legislature amended section 51, subdivision (a), which
specifies how the taxable value of real property “shall” be
determined. (See Western States, at p. 410.) As amended,
section 51, subdivision (a), now provides for an annual
adjustment of the taxable value of real property “upward or
downward, depending on market conditions.” (Metropolitan
Culinary Services, Inc. v. County of Los Angeles (1998)
61 Cal.App.4th 935, 939.) Specifically, section 51, subdivision (a),
provides that the taxable value of real property shall, with
limited exceptions, “be the lesser of: [¶] (1) Its base year value,
compounded annually since the base year by an inflation factor,”
not to exceed a 2 percent increase over the prior year’s value, and
14
“(2) Its full cash value, as defined in Section 110 [defining “‘full
cash value’” or “‘fair market value’”] as of the lien date, taking
into account reductions in value due to damage, destruction,
depreciation, obsolescence, removal of property, or other factors
causing a decline in value.” After the Assessor grants a reduction
under Proposition 8 due to a decline in the property’s value,
“section 51, subdivision (e), provides that the assessor shall
continue to reappraise the reduced-value property in subsequent
years until its fair market value exceeds the Proposition 13
value.”11 (El Dorado Palm Springs v. Board of Supervisors (2002)
104 Cal.App.4th 1262, 1266-1267 (El Dorado).)
B. Standard of Review
“‘Although a local assessment appeals board decision arises
from an administrative hearing process, the mechanism for
seeking judicial review of the decision “‘is significantly different
from that of other administrative agency decisions. Ordinarily
the aggrieved taxpayer’s remedy is not to seek administrative
mandate pursuant to Code of Civil Procedure section 1094.5, but
to pay the tax and file suit in superior court for a refund.’”’”
(Fisher v. County of Orange (2022) 82 Cal.App.5th 39, 51; accord,
11 Section 51, subdivision (e), specifies that after the taxable
value of property is reduced pursuant to section 51,
subdivision (a)(2), “the value of that property shall be annually
reappraised at its full cash value as defined in Section 110 until
that value exceeds the value determined pursuant to paragraph
(1) of subdivision (a).”
15
William Jefferson & Co., Inc. v. Orange County Assessment
Appeals Bd. No. 2 (2014) 228 Cal.App.4th 1, 10-11.)
“[A] county board of equalization ‘is a constitutional agency
exercising quasi-judicial powers’” delegated to it by the California
Constitution. (Steinhart v. County of Los Angeles (2010)
47 Cal.4th 1298, 1307; accord, Fisher v. County of Orange, supra,
82 Cal.App.5th at p. 51.) “Such a board’s ‘“‘factual
determinations are entitled on appeal to the same deference due
a judicial decision, i.e., review under the substantial evidence
standard.’ [Citation.]” [Citation.] When the assessment appeals
board decides a question of law, such as the interpretation of a
statute, courts are authorized to conduct an independent
reassessment.’’’ (Fisher, at p. 51; accord, Manson Construction
Co. v. County of Contra Costa (2020) 56 Cal.App.5th 1079, 1087.)
When interpreting a statute, “our core task . . . is to
determine and give effect to the Legislature’s underlying purpose
in enacting the statutes at issue.” (McHugh v. Protective Life Ins.
Co. (2021) 12 Cal.5th 213, 227; accord Jarman v. HCR
ManorCare, Inc. (2020) 10 Cal.5th 375, 381.) “We first consider
the words of the statutes, as statutory language is generally the
most reliable indicator of legislation’s intended purpose.
[Citation.] We consider the ordinary meaning of the relevant
terms, related provisions, terms used in other parts of the
statute, and the structure of the statutory scheme.” (McHugh, at
p. 227; accord, Jarman, at p. 381 [“‘We do not examine that
language in isolation, but in the context of the statutory
framework as a whole in order to determine its scope and purpose
and to harmonize the various parts of the enactment.’”].) “If the
relevant statutory language is ambiguous, we look to appropriate
extrinsic sources, including the legislative history, for further
16
insights.” (McHugh, at p. 227; accord, Skidgel v. California
Unemployment Ins. Appeals Bd. (2021) 12 Cal.5th 1, 14 [where
the statutory language supports more than one reasonable
construction, the court “may look to extrinsic aids, including the
ostensible objects to be achieved and the legislative history”].)
C. Section 4831, Subdivision (c), Does Not Apply
The Villa entities contend the one-year limitations period
in section 4831, subdivision (c), applied to issuance of the raise
letters because the Assessor proposed in the letters a correction
in the roll value after a decline-in-value assessment. However,
nothing in section 4831, subdivision (c), sets a time limit on the
Assessor’s presentation of evidence at a hearing in an assessment
appeal to show the value of the property was higher, not lower,
than the enrolled value.
Section 4831, subdivision (c), provides, “Any error or
omission involving the exercise of assessor value judgment that
arises solely from a failure to reflect a decline in the taxable
value of real property . . . , as required by paragraph (2) of
subdivision (a) of Section 51 shall only be corrected within one
year after the making of the assessment that is being corrected.”
As discussed, section 51, subdivision (a), in turn, states that the
taxable value of real property is the lesser of (1) the base year
value (here, the $100 million purchase price), as adjusted by a
yearly inflation factor not to exceed 2 percent per year, or (2) the
current full cash value (based on a decline in value pursuant to
Proposition 8). The Assessor’s higher valuation of the shopping
center in the raise letter is in no way a correction addressing the
failure of the Assessor to reflect a decline in value pursuant to
Proposition 8.
17
The Villa entities argue El Dorado, supra, 104 Cal.App.4th
at pages 1270 to 1271 supports their position. But El Dorado
only addressed an assessor’s ability to correct for a property’s
decline in value beyond the one-year limitations period of
section 4831, subdivision (c), not a raise letter issued as part of
an assessment appeal. There, the owner of a mobile home park
submitted an assessment appeal with the county assessment
appeals board requesting the board reduce the property’s 1993
tax assessment, arguing the property’s value had declined. (Id.
at p. 1266.) The appeals board upheld the value on the
assessment roll for 1993 (reflecting the purchase price plus
2 percent increases each year), but the trial court granted the
owner’s petition for a writ of mandate, requiring the appeals
board to vacate its findings and conduct a new hearing. After a
second hearing, in 1997 the appeals board found the property’s
fair market value for 1993 was less than the enrolled value,
requiring a reduction in the local roll. However, during and after
the assessment appeal, from 1994 through 1998, the assessor
continued to increase the enrolled value on the property by
2 percent each year. The owner again appealed to the county
assessment appeals board, challenging the assessments for the
five-year period. The appeals board rejected the challenge,
finding the appeals of the 1994 and 1995 assessments were
untimely, and the fair market value for the later three years
exceeded the enrolled values, and therefore the enrolled values
were proper. In an ensuing lawsuit by the owner for tax refunds
for the five years, the trial court agreed with the appeals board’s
findings. (Ibid.)
The Court of Appeal rejected the county’s contention that
the one-year limitations period in section 4831, former
18
subdivision (b) (now subdivision (c)), prevented the county from
correcting the 1994 and 1995 assessments to reflect a reduction
in value. (El Dorado, supra, 104 Cal.App.4th at pp. 1270-1271.)
The court explained, “[T]he delay in establishing the
Proposition 8 reduction [in 1997] necessarily extends the time
period for correcting an error in the tax assessments until after
the property has been reappraised and the taxable value
established.” (Ibid.) Contrary to the Villa entities’ contention,
the El Dorado court did not address whether a recommendation
to increase the assessed value of property pursuant to a raise
letter must be made within one year of a decline-in-value
assessment pursuant to section 4831, subdivision (c).
The Villa entities also argue that allowing the Assessor to
avoid section 4831, subdivision (c)’s limitations period during the
pendency of an assessment appeal would defeat section 4831’s
purpose of requiring the assessor to diligently propose any higher
assessed value within one year following a decline-in-value
assessment. The legislative history reflects a contrary intent.
In 1995 the Legislature added subdivision (b) to
section 4831 (now subdivision (c)) by enactment of Assembly Bill
No. 1620 (1995-1996 Reg. Sess.) (Stats. 1995, ch. 164, § 4,
p. 618).12 The Senate Rules Committee analysis of Assembly Bill
12 In 1996 the Legislature amended section 4831, former
subdivision (b), to read, “Any error or omission involving the
exercise of a value judgment that arises solely from a failure to
reflect a decline in the taxable value of real property as required
by paragraph (2) of subdivision (a) of Section 51 shall be
corrected within one year after the making of the assessment
that is being corrected.” (Stats. 1996, ch. 1087, § 23.5, italics
19
No. 1620 explained the need for the amendment: “In recent years
housing values have declined in many areas, and assessors have
been unable to keep up with the workload of adjusting the roll for
all applicable downward value changes. Therefore, in some cases
taxpayers receive a tax bill based on value growing by the two
percent inflation factor when in fact the value should have been
reduced; but by the time they receive the tax bill it is too late to
file for assessment reduction. [¶] This bill would give assessors
the authority to reduce assessed values via a roll correction
within one year after the assessment is completed, in situations
where the assessor failed to properly reflect a decline in value
pursuant to Proposition 8.” (Sen. Rules Com., Off. of Sen. Floor
Analyses, Analysis of Assem. Bill No. 1620 (1994–1995 Reg.
Sess.) as amended June 27, 1995, pp. 2-3; see also Governor’s Off.
of Planning & Research, Enrolled Bill Rep. on Assem. Bill
No. 1620 (1995–1996 Reg. Sess.) as amended June 27, 1995, p. 2
[“Under existing law, the county assessor is authorized to correct
errors on the roll within four years of the error for any kind of
error except errors in value judgment. This precludes the county
assessor from being able to perform Proposition 8 reductions after
the roll has been closed. [¶] [Assembly Bill No.] 1620 would
authorize a county assessor to correct an erroneous entry on the
added to show amendment.) In 2010 the Legislature moved
former subdivision (b) to subdivision (c) and modified the
language further to read, as it does today, “Any error or omission
involving the exercise of assessor value judgment that arises
solely from a failure to reflect a decline in the taxable value of
real property as required by paragraph (2) of subdivision (a) of
Section 51 shall only be corrected within one year after the
making of the assessment that is being corrected.” (Stats. 2010,
ch. 654, § 11, italics added to show amendment.)
20
property tax roll resulting solely from a failure to account for a
decline in the taxable value of real property within one year of
the entry.”].)
Further, in enacting section 4831, subdivision (c), the
Legislature intended to authorize the county assessor to correct
the local roll within one year to reflect a property’s decline in
value pursuant to Proposition 8 and section 51, subdivision (a)(2),
without the property owner having to file an assessment appeal.
As the Assembly Committee on Revenue and Taxation bill
analysis explained, “When property owners and assessors have
minor disagreements over the assessed value of the property, the
ability to correct errors determined to be caused by insufficient
consideration of an overall decline [in] real estate values will
allow the assessed value to be changed without having to file an
assessment appeal.” (Assem. Com. on Revenue and Taxation,
Analysis of Assem. Bill No. 1620 (1995–1996 Reg. Sess.) as
amended May 4, 1995, p. 4.) Nothing in the legislative history
reflects the Legislature’s intent to limit the ability of the county
assessor to recommend in a raise letter an increase in valuation
of property in connection with an assessment appeal.
D. Applying Section 4831, Subdivision (c), to Raise Letters
Would Be Inconsistent with the Statutory Scheme for
Assessment Appeals
Application of the one-year limitations period under
section 4831, subdivision (c), to raise letters informing an
applicant that the county assessor intends to present evidence at
an assessment appeals board hearing to support an increase in a
property’s valuation would also be inconsistent with the nature of
assessment appeals under California law. Under section 1603,
subdivision (a), a taxpayer may apply to reduce the assessment
21
on the local roll to reflect a decline in value of the property. (See
Williams & Fickett v. County of Fresno (2017) 2 Cal.5th 1258,
1269; Next Century Associates, LLC v. County of Los Angeles
(2018) 29 Cal.App.5th 713, 718.) Section 1603, subdivision (a),
provides, “A reduction in an assessment on the local roll shall not
be made unless the party affected or his or her agent makes and
files with the county board a verified, written application
showing the facts claimed to require the reduction and the
applicant’s opinion of the full value of the property.” The
taxpayer’s application for a reduction in the assessment must be
made to the “‘county board,’” which includes the “‘county board of
supervisors meeting as a county board of equalization or an
assessment appeals board.’” (LA Live Properties, LLC v. County
of Los Angeles (2021) 61 Cal.App.5th 363, 371.)
Assessment appeals seeking a reduction in the local roll
“are then resolved through a process that can involve a public
hearing (§§ 1605.4, 1605.6), exchanges of information (§ 1606),
examinations under oath (§ 1607), and the collection and
introduction of additional evidence in support or refutation of an
appeal (§§ 1609, 1609.4, 1609.5, 1610.2). Ultimately, ‘the county
board shall equalize the assessment of property on the local roll
by determining the full value of an individual property, by
assessing any taxable property that has escaped assessment,
correcting the amount, number, quantity, or description of
property on the local roll, canceling improper assessments, and
by reducing or increasing an individual assessment . . . .’
(§ 1610.8; see also § 1605, subd. (e).)” (Williams & Fickett v.
County of Fresno, supra, 2 Cal.5th at p. 1269, italics added;
accord, LA Live Properties, LLC v. County of Los Angeles, supra,
61 Cal.App.5th at p. 371.)
22
The Assessor’s issuance of the raise letters pursuant to
section 1609.4 was consistent with this statutory scheme. As
discussed, section 1609.4 requires the county assessor to provide
10 days’ notice of the assessor’s intent to introduce evidence at a
board hearing of a recommended higher assessed value. After
issuing the raise letter, the county assessor may introduce
supporting evidence of a higher valuation at the board hearing,
but it is the county board that has the duty to determine the full
value of the property. (See § 1610.8 [“After giving notice as
prescribed by its rules, the county board shall equalize the
assessment of property on the local roll by determining the full
value of an individual property, . . . [among other things] by
reducing or increasing an individual assessment, as provided in
this section. The full value of an individual property shall be
determined without limitation by reason of the applicant’s
opinion of value stated in the application for reduction in
assessment pursuant to subdivision (a) of Section 1603.”].)
Applying section 4831, subdivision (c), to bar the Assessor from
issuing any raise letter more than one year after the original
assessment would have tied the Assessor’s hands, preventing him
from presenting at the Board hearing the appraisal report that
provided a comprehensive analysis of the value of the property.
On appeal, the Villa entities do not dispute that the raise
letters complied with the 10-day procedural notice requirement of
section 1609.4.13 Instead, they contend that allowing the
13 The Villa entities no longer contend, as they had argued in
opposition to the County’s demurrer and in their summary
judgment motion, that the raise letters were untimely because
they were not issued at least 10 days before the first scheduled
23
Assessor to issue a raise letter seven years after the appeal was
filed, without applying the one-year limitations period of section
4831, subdivision (c), would permit the Assessor to issue a raise
letter at any time upon his whim or in retaliation against the
taxpayer for filing an assessment appeal. But the Assessor did
not issue the raise letter at his “whim,” instead properly giving
notice under section 1609.4 that he intended to present evidence
at the Board hearing to support an increase in the roll value.
Further, there is a built-in incentive for the Assessor to correctly
assess the value of the property at the time of the initial
valuation. Under State Board of Equalization Property Tax
Rule 321, subdivision (a), there is a presumption that the
assessor has properly performed his or her duties, with the
applicant having the burden of proving the value on the
assessment roll is incorrect. (Cal. Code of Regs., tit. 18, § 321,
subd. (a).) However, if the Assessor seeks to raise the roll value
as part of an assessment appeal, the Assessor has the burden to
prove the higher valuation. (Property Tax Rule 313, subd. (f)
[“When the assessor proposes to introduce evidence to support a
higher assessed value than the value on the roll, the assessor no
longer has the presumption accorded in regulation 321(a) of this
subchapter and the assessor shall present evidence first at the
hearing, unless the applicant has failed to supply all the
Board hearing and that an additional raise letter should have
been issued 10 days before the October 31, 2018 Board hearing.
(See Tiernan v. Trustees of Cal. State University & Colleges
(1982) 33 Cal.3d 211, 216, fn. 4 [issue not raised on appeal
“deemed waived”]; Swain v. LaserAway Medical Group, Inc.
(2020) 57 Cal.App.5th 59, 72 [“‘“Issues not raised in an
appellant’s brief are [forfeited] or abandoned.”’”].)
24
information required by law to the assessor.”]; see Sky River LLC
v. County of Kern (2013) 214 Cal.App.4th 720, 731 [the
presumption that the assessor has properly performed his duties
in calculating the value of the property “disappears when the
assessor seeks to increase the valuation of the taxpayer’s
property; in that event, the burden is on the tax assessor to prove
the higher value of the property”].) And, as discussed, at the
hearing it is the Board, and not the Assessor, that determines the
full value of the property, including an increase or reduction in
assessed value pursuant to section 1610.8.
The Villa entities also suggest the Assessor could issue a
raise letter at any time, 10 or even 20 years after the original
assessment date, depriving the taxpayers of the guarantees of
finality and predictability. But section 1604, subdivision (c),
requires the Board to decide the assessment appeal within two
years of the submission of a timely application for a reduction in
the assessment; if the appeal is not decided in that time frame,
the applicant’s proposed value becomes the enrolled value, unless
the applicant and the Board agree to an extension of time or the
application is consolidated with another application by the same
applicant.14 (Ibid.) Here, the Villa entities agreed to the delay
14 Section 1604, subdivision (c), provides, “If the county board
fails to hear evidence and fails to make a final determination on
the application for reduction in assessment of property within
two years of the timely filing of the application, the applicant’s
opinion of value as reflected on the application for reduction in
assessment shall be the value upon which taxes are to be levied
for the tax year or tax years covered by the application, unless
either of the following occurs: [¶] (1) The applicant and the
county board mutually agree in writing, or on the record, to an
25
that resulted in the 2019 hearing date.15
E. The Doctrine of Laches Does Not Apply
“‘Laches is based on the principle that those who neglect
their rights may be barred, in equity, from obtaining relief.’’’
(Krolikowski v. San Diego City Employees’ Retirement System
(2018) 24 Cal.App.5th 537, 568; accord, City of Oakland v.
Oakland Police & Fire Retirement System (2014)
224 Cal.App.4th 210, 248.) “‘The defense of laches requires
unreasonable delay plus either acquiescence in the act about
which plaintiff complains or prejudice to the defendant resulting
from the delay.’” (Johnson v. City of Loma Linda (2000)
24 Cal.4th 61, 68; accord, Robert F. Kennedy Medical Center v.
Belshe (1996) 13 Cal.4th 748, 760, fn. 9 [“Under appropriate
circumstances, the defense of laches may operate as a bar to a
claim by a public administrative agency . . . if the requirements of
unreasonable delay and resulting prejudice are met.”]; see
Krolikowski, at p. 569-570 [laches did not apply to bar city’s
extension of time for the hearing. [¶] (2) The application for
reduction is consolidated for hearing with another application by
the same applicant with respect to which an extension of time for
the hearing has been granted pursuant to paragraph (1). . . . ”
15 The Villa entities also argue in their opening brief that the
Board’s denial of the Villa entities’ request to withdraw their
application was “legal error” because the raise letters did not
comply with section 4831, subdivision (c)’s one-year limitations
period. This argument fails in light of our conclusion the one-
year limitations period does not apply to raise letters. Thus, the
Board correctly concluded under Board Rule 14.I that the Villa
entities could not withdraw their application because the
Assessor did not consent.
26
pension plan from correcting error that resulted in overpayment
to former employees of pension benefits where there was no
unreasonable delay].) “‘“[L]aches is not available where it would
nullify an important policy adopted for the benefit of the public.”’”
(Krolikowski, at p. 568; accord, Prang v. Los Angeles County
Assessment Appeals Bd. No. 2 (2020) 54 Cal.App.5th 1, 16
[“Applying laches here would nullify the ‘constitutional duty [of
assessors] to levy retroactive assessments’ as a means of fulfilling
the constitutional mandate of ‘equal and uniform’ taxation of ‘all’
property because it would place new limits on assessors’ ability to
fulfill that duty over and above the time limits created by our
Legislature . . . .”].)
“Prejudice is never presumed; rather it must be
affirmatively demonstrated by the defendant in order to sustain
his burdens of proof and the production of evidence on the issue.”
(Miller v. Eisenhower Medical Center (1980) 27 Cal.3d 614, 624;
accord, Drake v. Pinkham (2013) 217 Cal.App.4th 400, 406.)
“‘Generally, laches is a question of fact, but where the relevant
facts are undisputed, it may be decided as a matter of law.’”
(Krolikowski v. San Diego City Employees’ Retirement System,
supra, 24 Cal.App.5th at p. 568; accord, City of Oakland v.
Oakland Police & Fire Retirement System, supra,
224 Cal.App.4th at p. 248.)
The Villa entities argue laches barred the Assessor from
recommending a higher assessed value at the Board hearing
because there was an unreasonable, seven-year delay between
the filing of the assessment appeal on November 28, 2011 and the
Assessor’s assertion of a higher assessed value at the October 31,
2018 Board hearing. The Villa entities acknowledge the Assessor
issued two raise letters prior to the February 4, 2014 hearing,
27
attaching the appraisal report to the second letter, but they point
out the Assessor did not present evidence of the higher value at
the February 4 hearing. However, the Assessor could not have
presented evidence at the February 4 hearing because the Board
continued the hearing at the request of the Villa entities. And
the Villa entities agreed to a further continuance of the hearing
to October 31, 2018. Thus, there was no unreasonable delay by
the Assessor in presenting evidence of the property’s higher
assessed value. The lack of unreasonable delay is fatal to the
Villa entities’ laches argument.
Moreover, the Villa entities have not demonstrated
prejudice. They argue prejudice based on their inability to cross-
examine Partaker about his 2013 appraisal, which the Assessor
relied on to support the higher valuation. But the Villa entities
were able to cross-examine Grossman about Partaker’s appraisal
report, and they have failed to show how they were prejudiced by
their inability to examine Partaker, only stating generally that
Grossman had to “make assumptions” about the report and “did
not know the answer to several basic questions relating to the
report.” To the extent Grossman was unable to answer questions
about Partaker’s underlying assumptions in preparing the report,
if anything, this weakened the Assessor’s position. The Villa
entities do not provide any examples showing otherwise.
Nor did the Villa entities’ inability to cross-examine
Partaker about the appraisal report deny them a fair hearing. La
Prade v. Department of Water and Power (1945) 27 Cal.2d 47 (La
Prade), relied on by the Villa entities, is distinguishable. There,
a city department discharged a civil service employee for
publishing misleading statements about the department, and an
administrative board sustained the discharge based on an
28
investigation report it had on file, even though the report was not
introduced into evidence or provided to the employee at the
hearing. (Id. at pp. 49-50.) The Supreme Court held the
discharged employee was denied a hearing, reasoning the
employee was not “apprised of the evidence against him in order
that he may refute, test, and explain it.” (Id. at pp. 52-53.)
Unlike La Prade, in which the city department failed to
provide the employee with the investigator’s report on which the
department relied to uphold the discharge, the Villa entities were
provided the appraisal report used by the Assessor to support the
higher valuation. Further, in La Prade the discharged employee
had no opportunity to question the investigator (or anyone) about
the report. (La Prade, supra, 27 Cal.2d p. 50.) As discussed,
although the Villa entities were not able to cross-examine
Partaker, they had an opportunity to examine Grossman about
the appraisal report at the Board hearing. Absent a
constitutional right (none is asserted here),16 La Prade does not
require reversal of an administrative decision where the
petitioner was provided the evidence relied on by the agency and
was able to examine a knowledgeable representative about the
evidence.
16 The Supreme Court has clarified that the right to a hearing
at issue in La Prade was not based on a constitutional right. (See
Today’s Fresh Start, Inc. v. Los Angeles County Office of
Education (2013) 57 Cal.4th 197, 231, fn. 13 [La Prade “construed
nonconstitutional rights to a hearing and found those rights
violated in circumstances where a decision was rendered on
evidence never disclosed to the losing party and which the losing
party had no opportunity to controvert”].)
29
The Villa entities also argue their inability to cross-
examine Partaker violated Property Tax Rule 313,
subdivision (e), which provides with respect to hearings on
assessment appeals that “[t]here shall be reasonable opportunity
for the presentation of evidence, for cross-examination of all
witnesses and materials proffered as evidence, for argument and
for rebuttal.” There was no violation. At the Board hearing, the
Villa entities were able to cross-examine the Assessor’s witness
(Grossman), to present their own evidence of the shopping
center’s value, including the testimony of Kelley, and to make
arguments to rebut the Assessor’s higher valuation. Further,
Property Tax Rule 313, subdivision (e), specifies that “[t]he
hearing need not be conducted according to technical rules
relating to evidence and witnesses. Any relevant evidence may
be admitted if it is the sort of evidence on which responsible
persons are accustomed to rely in the conduct of serious affairs.
Failure to enter timely objection to evidence constitutes a waiver
of the objection.” The Villa entities did not object to the Board’s
admission of the appraisal report or to Grossman’s testimony at
the hearing.
30
DISPOSITION
The judgment is affirmed. The County of Los Angeles is
entitled to recover its costs on appeal.
FEUER, J.
We concur:
PERLUSS, P. J.
SEGAL, J.
31