806 N.W.2d 31
Minn.2011Background
- Berry & Co., Inc. challenges 2007–2008 property valuations for 253 Lake Street East, Wayzata, MN; subject property is 53,227 sq ft with three buildings that add no value; zoned C-4A, Limited Central Business District; assessed values were $2,540,000 (2007) and $2,650,000 (2008); both parties used market sales comparison approach; tax court adopted this approach; highest and best use contested; PUD history indicates redevelopment potential
- There was a 2006–2007 PUD allowing a three-story building, later expired in 2007; Berry argues lack of current approved PUD at 2008; zoning restrictions restrict buildings to two stories; County presented evidence of a reasonable probability a PUD could be obtained in near future
- The tax court concluded redevelopment as highest and best use for 2007 and 2008; court relied on PUD existence in 2007 and evidence of future PUD probability in 2008
- The tax court adopted the County’s $3,881,000 (2007) and $4,153,000 (2008) valuations; Berry challenges alleged inadequacies in adjustments and usable square footage used by the County’s appraiser
- The court held the valuation not clearly erroneous and within permissible limits, given evidentiary support and the tax court’s expertise
- The Lake Street Market Area is an area along Wayzata Bay with mixed uses; a PUD allows zoning flexibility; the 2006 PUD process involved both properties and city approvals.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Highest and best use supports redevelopment | Berry: no approved PUD seeks redevelopment | County/Tax Court: PUD existed in 2007; evidence supports redevelopment | Not clearly erroneous; redevelopment supported |
| Valuation adopted from County expert is supported | Berry: County adjustments/usable square footage flawed | Valuation within evidentiary support; trial court within discretion | Not clearly erroneous |
Key Cases Cited
- Carson Pirie Scott Co. (Ridgedale) v. Cnty. of Hennepin, 576 N.W.2d 445 (Minn. 1998) (establishes market comparison approach for valuation)
- EOP-Nicollet Mall, L.L.C. v. Cnty. of Hennepin, 723 N.W.2d 270 (Minn. 2006) (tax court deference; standard for reviewing valuation)
- Hedberg & Sons Co. v. Cnty. of Hennepin, 305 Minn. 80, 232 N.W.2d 743 (Minn. 1975) (evidence of future zoning modification as factor in value)
- Kmart Corp. v. Cnty. of Becker, 709 N.W.2d 238 (Minn. 2006) (clear error standard; deference to tax court’s judgment)
- Harold Chevrolet, Inc. v. Cnty. of Hennepin, 526 N.W.2d 54 (Minn. 1995) (tax court’s valuation need not mirror expert; within permissible limits)
- Montgomery Ward & Co. v. Cnty. of Hennepin, 482 N.W.2d 785 (Minn. 1992) (tax court’s expertise; valuation within reasonable range)