Opinion
15-00-16750; A114572.
On appellant-cross-respondent's petition for reconsideration filed March 24, 2004, and respondent-cross-appellant's response to petition for reconsideration filed March 31, 2004. Opinion filed March 10, 2004. 192 Or. App. 422, 86 P.3d 94 (2004).
Filed: April 28, 2004.
Appeal from Circuit Court, Lane County. Mary Ann Bearden, Judge.
William G. Wheatley, Maureen A. DeFrank, and Jaqua Wheatley, LLC, for petition.
Martha L. Walters and Walters Chanti Zennaché, P.C., contra.
Before HASELTON, Presiding Judge, and LINDER and ORTEGA, Judges.
HASELTON, P.J.
Reconsideration allowed; previous opinion modified and adhered to as modified.
Husband petitions for reconsideration of our opinion in Hanson and Hanson, 192 Or. App. 422, 86 P.3d 94 (2004). We allow reconsideration to correct our description of husband's argument, but adhere to our previous opinion in all other respects.
In our previous opinion, we affirmed the trial court's refusal to apply a marketability discount to husband's 100 percent ownership in a closely held corporation. In doing so, we characterized husband's argument, based on Tofte and Tofte, 134 Or. App. 449, 895 P.2d 1387 (1995), as follows:
"Husband's contention that Tofte mandates application of a marketability discount is incorrect. Rather, in that case we recognized that a marketability discount ` may apply' to the valuation of either a minority or majority interest. Id. at 456 n 3 (emphasis added). The application of such a discount in Tofte itself was appropriate because, in determining the fair market value of the closely held interest there, the husband's expert compared the husband's minority interest in the amusement park to a ` publicly traded equivalent price.' Id. at 458 (internal quotation marks omitted; emphasis added)."
Hanson, 192 Or App. at 428 (footnote omitted).
On reconsideration, husband correctly points out that, on appeal, he did not contend that Tofte mandated the application of a marketability discount in all cases. Rather, he merely contended that Tofte stands for the proposition that a marketability discount may be applied when valuing a majority interest in a business — and that the specific facts of this case supported application of such a discount.
We note that our prior opinion accurately quoted the trial court's letter opinion, which, similarly, phrased husband's argument in terms of Tofte mandating" that a marketability discount be applied to all controlling interests of non-publicly traded companies," as opposed to merely recognizing that a marketability discount may apply when valuing a majority interest in a business.
We modify our previous opinion to correct the above-quoted statement to read as follows:
"Husband's contention that Tofte — together with the specific circumstances presented by this case — requires application of a marketability discount is incorrect. We agree that in Tofte we recognized that a marketability discount ` may apply' to the valuation of either a minority or majority interest. Id. at 456 n 3 (emphasis added). In that case, the application of such a discount was appropriate because, in determining the fair market value of a closely held interest there, the husband's expert compared the husband's minority interest in the amusement park to a `publicly traded equivalent price.' Id. at 458 (internal quotation marks omitted)."
Husband next maintains that our inexact characterization of his argument warrants a different result in this case. He suggests that we should either remand the case "for a factual determination and analysis as to whether or not a marketability discount should be applied based on the specific facts of this case," or make that determination alone, "based upon the specific circumstances relevant to this case."
Neither remand nor further reconsideration is warranted. As we explained in our previous opinion, the trial court applied the correct legal standard and correctly assessed the specific circumstances involved in this case. Hanson, 192 Or App. at 429. Further, in our original opinion, we determined on de novo review that, in the circumstances presented here, application of a marketability discount would be inappropriate. Id. We adhere to that holding.
Reconsideration allowed; previous opinion modified and adhered to as modified.