Huber Hts. City Schools Bd. of Edn. v. Montgomery Cty. Bd. of Revision (Slip Opinion)
152 Ohio St. 3d 182
| Ohio | 2017Background
- The subject property was an 11.496-acre retail parcel (building + parking) split from a larger parcel and sold in June 2012 to Huber Heights ABG for $550,000; seller retained an out lot.
- For tax year 2012 the undivided parcel’s valuation was settled at $850,000. For tax year 2013 the auditor created a new parcel and valued it at $2,199,700. Huber Heights ABG sought $850,000; the school board sought to keep the auditor’s value.
- At the Board of Revision (BOR) hearing Huber Heights ABG submitted closing statements to the BOR (but not to the school board) and offered witness testimony that it paid $550,000 and later spent about $200,000 in improvements. The BOR reduced the value to $1,282,740.
- The school board appealed to the Board of Tax Appeals (BTA). The BTA rejected the BOR valuation and set the tax-year-2013 value at $550,000, finding the June 2012 sale to be a recent arm’s-length transaction.
- The Ohio Supreme Court reviewed whether the BTA reasonably and lawfully relied on the sale price (including burden allocation and whether post-sale improvements defeated recency). The Court affirmed the BTA.
Issues
| Issue | Plaintiff's Argument (School Bd.) | Defendant's Argument (Huber Heights ABG) | Held |
|---|---|---|---|
| Whether Huber Heights ABG met initial burden to establish sale as qualifying evidence of value | Huber Heights ABG failed to meet initial burden because it did not advocate the $550,000 sale price below and offered limited documentary proof | Sale was undisputed and supported by closing statements and testimony; less documentary proof is acceptable when basic sale facts are not contested | BTA reasonably presumed the sale met requirements for true value because basic facts of sale were undisputed and supported by some evidence |
| Burden allocation for rebutting presumption of recency/arm’s-length sale | School board argued Huber Heights ABG’s failure to press the sale price below estops reliance on recency; school board should not bear burden to disprove recency | BTA may independently determine taxable value and may apply presumption of recency; once initial burden met, opponent must produce rebuttal evidence | Court held BTA properly applied presumption and required school board to produce rebuttal evidence showing sale not recent or not at arm’s length |
| Whether post-sale improvements ($~200,000) defeated recency of the sale | Post-sale expenditures were substantial relative to sale price and thus made sale not recent; school board should not be forced to prove nature of improvements | Improvements alone do not negate recency absent evidence they materially changed the property; Huber Heights ABG could have produced or been compelled for details | BTA reasonably found no evidence showed the improvements substantially changed the property; recency presumption stood |
| Admissibility/consideration of closing statements in record | School board argued closing statements weren’t admitted at BOR and thus inadmissible | Closing statements were included in the statutory transcript certified to the BTA and the school board did not object before the BTA | Court held school board waived challenge; BTA could consider closing statements in the transcript |
Key Cases Cited
- Akron City School Dist. Bd. of Edn. v. Summit Cty. Bd. of Revision, 139 Ohio St.3d 92 (standard of review; legal issues de novo)
- Cincinnati School Dist. Bd. of Edn. v. Hamilton Cty. Bd. of Revision, 78 Ohio St.3d 325 (presumption that recent arm’s-length sale is best evidence of value; burden to rebut)
- Sapina v. Cuyahoga Cty. Bd. of Revision, 136 Ohio St.3d 188 (BTA’s independent duty to determine taxable value)
- Dauch v. Erie Cty. Bd. of Revision, 149 Ohio St.3d 691 (less documentary proof required when basic sale facts are undisputed)
- Terraza 8, L.L.C. v. Franklin Cty. Bd. of Revision, 150 Ohio St.3d 527 (2012 amendment to R.C. 5713.03: a recent arm’s-length sale price is not conclusive and may be rebutted)