Riverside Owner, LLC v. City of Richmond
711 S.E.2d 533
Va.2011Background
- Brown's Island redevelopment by Richmond Power Plant, LLC under a 2003 development agreement with City promising full Program benefits.
- Richmond Power Plant applied for the Program in 2002; base value of the two power plants was $1,000,000 ($500k each).
- Rehabilitation completed 2003–2005 at cost about $63.8 million; property sold to Riverside Owner, LLC for $85 million in August 2005.
- City Assessor backdated the rehabilitated value to 2002 using Chandler policy, reducing the initial rehabilitated value to about $45.2 million.
- Chandler policy, adopted in 1981, uses backdated value rather than post-rehabilitation value; policy not published until 2006; amount of exemption calculated from backdated figure.
- Riverside challenged Chandler policy as inconsistent with Code § 58.1-3221 and City Code § 27-83; circuit court agreed, invalidating Chandler policy for purposes of the Program.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Chandler policy complies with statutory framework. | Riverside/Taxpayers: Chandler policy violates Code § 58.1-3221 and City Code § 27-83. | City: Chandler policy is consistent with statute and ensures exemption does not exceed rehabilitation increase. | Chandler policy inconsistent with § 27-83; use of first post-rehab value required. |
| Admission of expert Englander’s testimony. | Englander’s expertise supports uniformity claim. | Testimony is speculative/unqualified to Virginia context. | Harmless error; did not affect outcome. |
| Retail space (Parcel 1138) inclusion in final order. | Retail space should be included as part of post-rehabilitation values. | Exclusion based on pleadings/pleadings scope. | Retail space properly included in final order. |
| Entitlement to attorney’s fees under Agreement §9.5. | Prevailing party should recover fees under Agreement. | Case framed as erroneous assessment under §58.1-3984, not contract breach. | No attorney’s fees under §9.5; no contract breach proven. |
| Proper method to determine initial rehabilitated assessed value. | Use rehabilitation cost or contemporaneous market value. | Use first rehabilitated value as determined by backdated methodology. | Court rejected Chandler backdating; first post-rehab value governs exemption. |
Key Cases Cited
- Warrington v. Commonwealth, 280 Va. 365 (2010) (statutory interpretation is de novo)
- Commonwealth v. Amerson, 281 Va. 414 (2011) (ascertain legislative intent; plain meaning controls)
- Ford Motor Co. v. Gordon, 281 Va. 543 (2011) (proper interpretation of statutes; avoid redundancy)
- Antisdel v. Ashby, 279 Va. 42 (2010) (apply reasonable effect to every word in statute)
- DKM Richmond Assocs. v. City of Richmond, 249 Va. 401 (1995) (definition of assessment; value determinations)
- John v. Im, 263 Va. 315 (2002) (expert testimony must be based on adequate factual foundation)
- Countryside Corp. v. Taylor, 263 Va. 549 (2002) (admissibility of expert testimony; variables considered)
- Nusbaum v. Berlin, 273 Va. 385 (2007) (attorney’s fees absent contractual/statutory provision)
- Keswick Club, L.P. v. County of Albemarle, 280 Va. 381 (2010) (harmless error where expert testimony could not affect result)