Johnston Coca-Cola Bottling Co., Inc. v. Hamilton Cty. Bd. of Revision (Slip Opinion)
149 Ohio St. 3d 155
| Ohio | 2017Background
- Johnston Coca‑Cola Bottling Co. owns a 34.46‑acre site with a 426,229 sq. ft. bottling/distribution facility in Hamilton County; auditor valued it at $13,571,760 for tax year 2011.
- Coca‑Cola sought reduction to $6,800,000 before the Board of Revision (BOR); BOR retained auditor’s value. Coca‑Cola appealed to the Board of Tax Appeals (BTA).
- Coca‑Cola’s appraisers (Solomon at BOR; Racek at BTA) valued the property between $6.5M and $9M, relying on sales‑comparison and income approaches and treating continued use as highest and best use.
- The auditor’s in‑house appraiser, Thoreson, produced a new appraisal at the BTA valuing the property at $14,000,000 (sales‑comparison and income approaches, with weight to local comparables and leased comparables).
- The BTA adopted Thoreson’s appraisal and increased the valuation to $14,000,000. A clerical error initially listed the valuation date as January 1, 2012; the BTA issued a nunc pro tunc correcting it to January 1, 2011 after Coca‑Cola filed its appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the BTA impermissibly relied on "present‑use" valuation | Coca‑Cola: BTA gave controlling weight to present use (bottling) and comparables tied to that use, violating Article XII §2 | BTA/Auditor: Present use may be considered; Thoreson used market‑based sales and income approaches and concluded highest and best use matched current use | Court: Permissible to consider present use; no improper present‑use valuation—BTA relied on market approaches and did not exclude market factors |
| Whether BTA erred in crediting Thoreson’s appraisal over Coca‑Cola’s appraisers (comparables, verification, adjustments) | Coca‑Cola: Thoreson used inapt comparables, failed to verify/adjust sufficiently | Auditor/BTA: Thoreson used local, size‑ and utility‑similar comparables, verified sales with grantees/brokers, and adjusted for relevant factors | Court: Reviewed for abuse of discretion and found no abuse; Thoreson’s selections, verification, and adjustments were adequately supported |
| Whether Thoreson’s status as a county employee rendered his appraisal inherently biased | Coca‑Cola: County employment creates impermissible bias; report should be rejected or given little weight | Auditor/BTA: Employment does not establish bias; licensed appraisers may be retained/employed and can be disinterested | Held: No evidence of actual bias; BTA reasonably weighed his testimony; employment alone does not disqualify or invalidate appraisal |
| Whether BTA could correct clerical error after notice of appeal filed | Coca‑Cola: BTA’s nunc pro tunc correcting tax‑lien date issued after appeal was void; decision unlawful | Auditor/BTA: BTA corrected an obvious clerical error to reflect intent (change from 2012 to 2011) | Court: BTA loses authority to amend under Ohio Adm.Code 5717‑1‑20 once a notice of appeal is filed; the nunc pro tunc was void; this court modified the BTA decision to correct the clerical error and affirmed remainder |
Key Cases Cited
- Rite Aid of Ohio, Inc. v. Washington Cty. Bd. of Revision, 146 Ohio St.3d 173 (discusses exchange/market value vs. present‑use valuation)
- Dinner Bell Meats, Inc. v. Cuyahoga Cty. Bd. of Revision, 12 Ohio St.3d 270 (present use may be considered in valuation)
- State ex rel. Park Invest. Co. v. Bd. of Tax Appeals, 175 Ohio St. 410 (defining exchange value as sales price)
- Oakwood Club v. Cuyahoga Cty. Bd. of Revision, 70 Ohio St.3d 241 (highest and best use aligning with current use is permissible)
- Westerville City Schools Bd. of Edn. v. Franklin Cty. Bd. of Revision, 146 Ohio St.3d 412 (appraiser verification standards and abuse‑of‑discretion review)
- 1495 Jaeger, L.L.C. v. Cuyahoga Cty. Bd. of Revision, 132 Ohio St.3d 222 (BTA loses jurisdiction to modify decision after timely appeal)
- Steak 'n Shake, Inc. v. Warren Cty. Bd. of Revision, 145 Ohio St.3d 244 (credibility and weight of expert testimony reviewed for abuse of discretion)