115 N.E.3d 531
Ind. T.C.2018Background
- Wigwam Holdings LLC owned four parcels (≈18 acres) including an 8.56-acre parcel with a 220,000 sq. ft. arena/gymnasium (the "Wigwam"); property was unoccupied on the March 1, 2015 assessment date.
- Assessor initially assessed the property at $11,415,000; PTABOA reduced it to $2,115,200; Holdings appealed to the Indiana Board seeking reduction to $68,500 based on an appraisal and the September 2014 transfer.
- Holdings presented a USPAP-compliant appraisal (Allardt) concluding the building had negative value due to demolition/remediation costs and highest-and-best-use as vacant land; appraiser relied in part on the September 2014 quitclaim transfer (acquired for $0 with $630,000 escrow for restoration).
- Assessor rebutted with expert testimony (Garrison) arguing the property is a special-purpose property for which market value-in-use (cost approach) applies, that the 2014 transfer was not a typical market sale, and that Allardt ignored deed/escrow restrictions and applicable assessment standards.
- Indiana Board found Holdings failed to make a prima facie case: Allardt’s appraisal lacked probative value as market value-in-use, the 2014 sale was not a probative market transaction, and abnormal obsolescence was unquantified.
- Holdings petitioned to enjoin tax collection pending appeal; Tax Court denied the injunction because Holdings failed to show a reasonable opportunity to prevail on the merits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Holdings made a prima facie case via a USPAP appraisal | Allardt’s USPAP appraisal and testimony establish prima facie case; burden shifted to Assessor | Assessor presented expert evidence challenging appraisal’s credibility and applicability (market value vs. market value-in-use) | Denied: Board reasonably weighed conflicting evidence; no abuse of discretion |
| Whether the Sept. 2014 transfer established market value | Transfer (zero cash + $630k escrow) shows actual market value (negative sale) | Transfer not a typical market sale (government seller, deed restrictions, escrow) so not probative of market value | Denied: Board reasonably found sale not probative |
| Whether abnormal obsolescence required reduction | Building’s functional/economic obsolescence demonstrated, so assessment should be reduced | Holdings failed to quantify obsolescence; mere methodological attack insufficient | Denied: Holdings did not quantify cause/amount of obsolescence |
| Whether injunction to enjoin tax collection should issue | Substantial issues and equities favor injunction; risk of loss and fiscal harm to Holdings | State’s interest in tax collection and Board’s factual determinations weigh against injunction | Denied: Holdings failed first required factor (reasonable opportunity to prevail), so injunction not granted |
Key Cases Cited
- Video Tape Exch. Coop. of Am., Inc. v. Indiana Dep’t of State Revenue, 512 N.E.2d 476 (Ind. Tax Ct.) (defines reasonable opportunity to prevail standard for injunctions)
- Marion Cty. Assessor v. Washington Square Mall, LLC, 46 N.E.3d 1 (Ind. Tax Ct.) (discusses appraisal evidence and prima facie proof)
- Stinson v. Trimas Fasteners, Inc., 923 N.E.2d 496 (Ind. Tax Ct.) (Tribunal is factfinder; Court will not reweigh evidence absent abuse of discretion)
- Millennium Real Estate Inv., LLC v. Assessor, Benton Cty., 979 N.E.2d 192 (Ind. Tax Ct.) (distinguishes market value from market value-in-use for properties with current use differing from highest-and-best use)