Town Square Limited Partnership v. Union County Assessor
TC-MD 200057G
| Or. T.C. | Dec 23, 2020Background
- Subject property: remaining personal property (grocery and bistro equipment) of Marketplace Family Foods; originally purchased reconditioned in 2016 with reported costs of $422,670.
- Marketplace became financially distressed in late 2017; U.S. Bank acquired the property (pre‑March 2018) and commissioned an appraisal dated Nov. 16, 2017 showing Forced Liquidation $42,835 and Orderly Liquidation $65,945.
- Plaintiff (landlord) negotiated with U.S. Bank and bought the equipment in April 2018 for $42,500 (plus $5,000 for other items); Plaintiff argued market value was no more than $65,945.
- Defendant (Union County Assessor) placed 2019–20 real market value at $299,510 using 2016 purchase prices and Department of Revenue depreciation (cost‑factor) tables.
- Trial issues: appropriate measure of real market value as of Jan. 1, 2019; admissibility/weight of liquidation appraisal and of the 2018 bank sale; adequacy of assessor’s cost‑factor valuation testimony.
- Court concluded Plaintiff failed to meet its burden: the appraisal was inadequate, the 2018 bank sale was tainted by compulsion and non‑typical conditions, and the assessor’s cost analysis was not fully supported, but the burden was Plaintiff’s; assessment sustained.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Proper real market value as of Jan. 1, 2019 | Use appraisal/orderly liquidation $65,945 as RMV | Use 2016 cost less depreciation (assessor’s $299,510) | Plaintiff failed to prove lower RMV; roll sustained |
| Weight of liquidation appraisal report | Appraisal’s orderly liquidation figure reflects market under reasonable exposure | Liquidation assumes seller compulsion; report lacks supporting data and appraiser did not testify | Report inadequate: liquidation values assume compulsion, lack underlying data, and appraiser absent; insufficient to prove RMV |
| Reliability of 2018 sale to landlord | $42,500 purchase is recent sale evidence of value | Sale was a quick, private bank sale under pressured conditions, not arm’s‑length | Sale excluded as reliable RMV evidence due to nontypical bank‑sale conditions and lack of marketing |
| Sufficiency of assessor’s cost‑factor valuation | (Plaintiff did not rely on this) | Assessor relied on Dept. depreciation tables and deputy’s work to support $299,510 | Assessor’s supporting testimony was weak, but burden rested on Plaintiff; Court sustained assessor’s roll |
Key Cases Cited
- Freedom Fed. Savings & Loan v. Dept. of Rev., 310 Or 723, 801 P.2d 809 (addresses highest and best use requirement before valuation)
- Chapin v. Dept. of Rev., 290 Or 931, 627 P.2d 480 (applicability of valuation methods depends on property character and available data)
- Kem v. Dept. of Rev., 267 Or 111, 514 P.2d 1335 (recent, voluntary, arm’s‑length sale is highly persuasive evidence of market value)
- Sabin v. Dept. of Rev., 270 Or 422, 528 P.2d 69 (requirements for treating a prior sale as "recent" and burden to show intervening market changes)