Opinion
111,762.
08-14-2015
In the Matter of the Equalization Appeal of JC PENNEY CORPORATION, INC. for the Year 2011 in Wyandotte County, Kansas.
Linda Terrill, of Property Tax Law Group, LLC, of Leawood, for appellant. Jarrod C. Kieffer, of Stinson Leonard Street, LLP, of Wichita, for appellee.
Linda Terrill, of Property Tax Law Group, LLC, of Leawood, for appellant.
Jarrod C. Kieffer, of Stinson Leonard Street, LLP, of Wichita, for appellee.
Before MALONE, C.J., LEBEN, J., and HEBERT, S.J.
MEMORANDUM OPINION
PER CURIAM.
JC Penney Corporation, Inc. (JC Penney) appeals the order of the Court of Tax Appeals (COTA) affirming the appraised value of its property at $7,925,000 for the 2011 tax year. JC Penney argues (1) the affirmed value was impermissibly rolled over from an earlier year in violation of K.S.A. 79–1460 ; (2) the affirmed value was not supported by substantial competent evidence; and (3) COTA erroneously denied JC Penney's motion to recuse certain COTA judges. Because we agree with JC Penney on the third issue, we remand for further proceedings.
This is an appeal regarding the appraisal valuation for the 2011 tax year by the Unified Government of Wyandotte County and Kansas City, Kansas (the County), of certain property owned by JC Penney. The property, located at 10904 Stadium Parkway in Kansas City, Kansas, is part of Village West, a real estate development in Wyandotte County that also includes numerous restaurants, hotels, retail stores, the Kansas Speedway racetrack, and a soccer stadium. The property is an owner-occupied 99,146 square foot retail building on 8.48 acres of land, classified as commercial property, and the County appraised the property in 2011 at $7,925,000.
In June 2011, JC Penney filed an equalization appeal with COTA, estimating that the value of its property was $3,962,500. In an agreed-upon prehearing order, JC Penney changed its requested valuation to $4,950,000. On November 2, 2012, JC Penney filed a motion for the recusal of COTA judges Sam Sheldon, James Cooper, and Trevor Wohlford, and, if necessary, Janis Lee. After a hearing on the motion, COTA denied it.
The hearing on the equalization appeal occurred in June 2013. Because we are not addressing the merits of the valuation in this opinion, we will briefly summarize the hearing. The County presented testimony from Kevin Bradshaw, the commercial and real property supervisor with the County's appraiser's office. Bradshaw testified that he performed an appraisal for the tax year 2011, using the cost and income approaches, and concluded that the value of the property was $8,339,900, but “at the end of the day, [he] rolled a previous stipulation through,” resulting in an appraised value of $7,925,000.
The County also presented testimony from Robert Jackson, a Kansas-certified appraiser working for Bliss Associates. Jackson testified extensively about his appraisal of the subject property, effective January 1, 2011, and his appraisal report was admitted into evidence. Although Jackson valued the property using the cost approach, the income approach, and the sales comparison approach, he testified that he ultimately relied upon the income approach and concluded that the value of the property was $8,900,000.
JC Penney's sole witness was Thomas Slack, a Kansas-licensed appraiser and owner of Thomas H. Slack Appraisal Company, Inc.; he was accepted by COTA as an expert on the subject of appraisal of JC Penney's property with no objection by the County. Slack also utilized all three approaches to valuation and explained his calculations thoroughly. His appraisal report was admitted into evidence. Ultimately, Slack concluded that the value of the property as of January 1, 2011, was $4,950,000.
COTA filed its order on March 12, 2014. After a lengthy analysis, COTA concluded that “the subject property's current appraised value of $7,925,000 is fully supported and hereby sustained.” JC Penney filed a petition for reconsideration which was denied. JC Penney then timely filed a petition for judicial review with this court.
On appeal, JC Penney argues that COTA erred in denying its motion for recusal and, by doing so, denied it a hearing before an impartial panel of judges. The County responds that there is no proof that the COTA judges were biased against JC Penney or JC Penney's counsel to the extent that warranted recusal. Understanding this argument requires additional background information involving two other tax cases that were before COTA and ended up before this court: In re Tax Appeal of Lyerla Living Trust, 50 Kan.App.2d 1012, 336 P.3d 882 (2014), hereafter referred to as Lyerla, and In re Chrysler Building, L.L.C., No. 110,792, 2015 WL 967561 (Kan.App.2015) (unpublished opinion), hereafter referred to as Chrysler Building.
Linda Terrill represents JC Penney in the instant case and for more than 15 years has represented many other clients in proceedings before COTA and BOTA. See, e.g, Lyerla, 50 Kan.App.2d at 1012 (Terrill representing party in appeal from COTA order); In re Appeal of Brocato, 46 Kan.App.2d 722, 277 P.3d 1135 (2011) (same); St. Catherine Hospital v. Roop, 34 Kan.App.2d 638, 122 P.3d 414 (2005) (Terrill representing appellee in appeal from BOTA decision); In re Tax Exemption Application of Via Christi Regional Med. Ctr., 27 Kan.App.2d 446, 6 P.3d 896 (2000) (same); Board of Leavenworth County Comm'rs v. McGraw Fertilizer Serv., Inc., 261 Kan. 901, 933 P.2d 698 (1997) (same). At the time the instant case was before COTA, Terrill was involved in at least 27 other cases before COTA; those cases ended up before this court as two appeals: Lyerla, which concerned 5 tax appeals from Johnson County consolidated into one appeal, and Chrysler Building, which concerned the consolidated cases of an additional 22 tax appeals.
Twenty-five of the 27 taxpayers involved in Lyerla and Chrysler Building had hired J.W. Chatam and Associates, Inc. (Chatam), a tax-consulting firm, to handle appeals from the taxation of their real property. See Lyerla, 50 Kan.App.2d at 1014 ; Chrysler Building, 2015 WL 967561, at *1. In August 2012, COTA ordered the taxpayers who had engaged Chatam to show cause why their cases should not be dismissed for lack of subject matter jurisdiction because the notices of appeal from the real-property valuations were not properly signed. Lyerla, 50 Kan.App.2d at 1014–15 ; Chrysler Building, 2015 WL 967561, at *1–2. In Chrysler Building, Terrill had “signed each case's equalization/protest form, which listed the name of the owner of the property but also listed the name and address of Chatam under the ‘appellant information’ section.” 2015 WL 967561, at *1. In Lyerla, “a non-attorney employee of Chatam signed and filed the notices of appeal” in the small-claims division of COTA and when the taxpayers did not obtain relief in that division, “Terrill filed a notice of appeal in the regular division [of COTA] for each taxpayer.” 50 Kan.App.2d at 1014. In September 2012, COTA held an extensive evidentiary hearing regarding the relationships between the various taxpayers, Chatam, and Terrill. Lyerla, 50 Kan.App.2d at 1015 ; Chrysler Building, 2015 WL 967561, at *2.
On October 4, 2012, COTA Judges Sam H. Sheldon and Trevor C. Wohlford sent a complaint to the office of the Disciplinary Administrator “discussing how Terrill had committed multiple ethical violations.” Chrysler Building, 2015 WL 967561, at *3 ; see also Lyerla, 50 Kan.App.2d at 1016. The complaint provided “a ‘summary of possible violations of [the Kansas Rules of Professional Conduct (KRPC) ],” ‘ listing nine rules Terrill had possibly violated.
On October 11, 2012, COTA issued lengthy opinions in each case–77–page opinions in Chrysler Building and opinions over 80 pages long in Lyerla. Lyerla, 50 Kan.App.2d at 1015 ; Chrysler Building, 2015 WL 967561, at *2. Judges Sheldon and Wohlford also transmitted copies of the Lyerla opinions to the office of the Disciplinary Administrator. The office of the Disciplinary Administrator investigated the complaint, conducting interviews with Sheldon, Wohlford, and Terrill and examining numerous exhibits, pleadings, and arguments from both the complainants and Terrill, the respondent. While the investigation proceeded, the cases in Chrysler Building and Lyerla also continued.
In the October 11, 2012, Lyerla orders, COTA held that it had no subject-matter jurisdiction because the notices of appeal had not been properly signed. 50 Kan.App.2d at 1015. The orders, however, went beyond this finding, concluding also that (1) “even though Chatam had a contingent-fee interest in the appeals, the taxpayers remained the real parties in interest in their tax appeals”; (2) “the written contracts between Chatam and the taxpayers were void as against public policy” because they were champertous—“the result of ‘an officious intermeddler['s]’ involvement in a lawsuit in exchange for part of the proceeds [citation omitted]—but the champertous nature” did not deprive COTA of jurisdiction over the appeals; (3) if COTA had jurisdiction, it would require the taxpayers to proceed without Terrill or Chatam because COTA concluded that Terrill had assisted Chatam in engaging in the unauthorized practice of law and Terrill appeared to have violated several provisions of the KRPC; and (4) there were “ ‘general reasons to question the credibility’ “ of testimony made by a principal and owner of Chatam and statements by Terrill at the hearing. 50 Kan.App.2d at 1015–16. The Lyerla orders were signed by Judges Sheldon, Wohlford, and James D. Cooper.
In the Chrysler Building orders, COTA held that it had subject matter jurisdiction but also held that Terrill had assisted Chatam in engaging in improper champertous conduct. 2015 WL 967561, at *2. COTA ruled that Terrill might have engaged in champerty herself thereby violating KRPC Rule 1.8(e) ; Chatam engaged in the unauthorized practice of law; and Terrill violated multiple additional provisions of the KRPC.2015 WL 967561, at *2–3. COTA therefore declared the Chrysler Building taxpayers' agreements with Chatam void as against public policy and imposed a stay on the tax appeals until each taxpayer either retained new counsel unassociated with Terrill or Chatam or filed notice that the taxpayer would proceed pro se. 2015 WL 967561, at *3. COTA held that it would dismiss each case for lack of prosecution if the taxpayers did not hire new counsel or proceed pro se within 60 days of the October ruling. 2015 WL 967561, at *3. The Chrysler Building orders were also signed by Judges Sheldon, Wohlford, and Cooper.
On November 2, 2012, the taxpayers in Chrysler Building and Lyerla, as well as JC Penney and Terrill as counsel and individually in the instant case, all filed motions for the recusal of Judges Sheldon, Wohlford, and Cooper and, if applicable, Janis Lee. Lyerla, 50 Kan.App.2d at 1016 ; Chrysler Building, 2015 WL 967561, at *3. Lee appears to have been COTA's chief hearing officer at the time, and the chief hearing officer was statutorily authorized to serve as a judge pro tempore of COTA when necessary. See K.S.A.2011 Supp. 74–2433(a). Because COTA by statute needed two judges to issue a final order, if the three named COTA judges had recused, it was possible that Lee might have so served in order to reach the quorum required to issue a final order. See K.S.A.2011 Supp. 74–2433(a). In addition, the Governor could possibly have appointed additional pro tem judges. See Lyerla, 50 Kan.App.2d at 1026. JC Penney argued that because Lee had been present at proceedings underlying the alleged bias—presumably Chrysler Building and Lyerla —as well as during matters involving other tax attorneys and tax consultants, she could not afford JC Penney fair consideration any more than the named COTA judges could.
JC Penney further alleged that the named COTA judges were engaged in a malicious campaign of undermining and ruling against Terrill and her law firm, including ruling on issues over which COTA had nc jurisdiction, issuing rulings unsupported by evidence or legal authority, and ruling without giving the required notice or opportunity to be heard on the issues. The motion cited to proceedings and the October 2012 orders in both Lyerla and Chrysler Building and to the disciplinary complaint. JC Penney contended that the bias was obvious and resulted in the named judges being unable to present an appropriately impartial forum to hear the instant case; accordingly, the judges should recuse themselves.
Attached to JC Penney's motion was an affidavit from Terrill, relating some of Terrill's interactions with COTA, and copies of the Chrysler Building and Lyerla orders. Like JC Penney's motion, the motions to recuse in Chrysler Building and Lyerla argued that COTA's decisions and the disciplinary complaint demonstrated an obvious bias against Terrill and her clients. See Lyerla, 50 Kan.App.2d at 1016 ; Chrysler Building, 2015 WL 967561, at *3.
It appears from the record on appeal that COTA held oral argument on JC Penney's motion for recusal on November 5, 2012, but the record on appeal does not contain any transcript of that argument. On November 27, 2012, COTA denied the motions for recusal in the instant case, Lyerla, and Chrysler Building. See Lyerla, 50 Kan.App.2d at 1016 ; Chrysler Building, 2015 WL 967561, at *3. In Lyerla, COTA “found no legal basis for recusal [and] concluded that it was an independent body with no mechanism to provide substitute judges; accordingly, it concluded that the rule of necessity would require its judges to hear the appeals even if there were some valid basis for disqualification.” 50 Kan.App.2d at 1016–17.
In denying the motion for recusal in the instant case, COTA held that there was no legal basis for recusal, that the doctrine of necessity required its judges to hear the appeal, and that the doctrine of extrajudicial source rendered COTA judges' actions in Lyerla and Chrysler Building immaterial to whether those judges should recuse themselves in JC Penney's case. COTA also responded to JC Penney's allegations that it had acted outside the scope of its authority in Lyerla and Chrysler Building, noting that it believed at least a good-faith argument could be made that it had not done so. Finally, COTA examined Terrill's affidavit and other facts asserted in the motion for recusal and found them insufficient, either because they were factually imprecise or because the doctrine of extrajudicial source rendered them immaterial.
The taxpayers in Chrysler Building and Lyerla filed motions for reconsideration and to strike the portions of the orders that addressed issues the taxpayers argued were outside COTA's authority, including Terrill's alleged ethical violations. Lyerla, 50 Kan.App.2d at 1016 ; Chrysler Building, 2015 WL 967561, at *3. COTA granted the motions for reconsideration, but in February 2013 issued lengthy opinions—158 pages in Chrysler Building and 175 pages in Lyerla —reaffirming its October 2012 rulings. Lyerla, 50 Kan.App.2d at 1016 ; Chrysler Building, 2015 WL 967561, at *3. In Lyerla, COTA went even further than the original order, holding that Terrill had actually violated several KRPC Rules, whereas before COTA had opined only that she appeared to have violated them. 50 Kan.App.2d at 1016. COTA also “made extensive factual findings about why it did not find the testimony of Jerry Chatam or the representations made by Terrill at the September 18 hearing credible.” 50 Kan.App.2d at 1016. COTA's disposition of the cases in Lyerla was to dismiss for lack of subject-matter jurisdiction. 50 Kan.App.2d at 1015. In Chrysler Building, COTA also dismissed the cases after finding that its deadline had passed for the taxpayers to either hire new counsel or proceed pro se. 2015 WL 967561, at *4. The dismissals in both cases were appealed to this court.
Meanwhile, COTA ruled against JC Penney on the merits of the instant case. The COTA judges who signed the order were Sheldon, Cooper, and Ronald C. Mason, two of whom are judges named in JC Penney's earlier motion to recuse. After the order, JC Penney filed a petition for reconsideration, in which it not only alleged error in COTA's substantive rulings, it also argued that COTA erred by denying the previous motion to recuse. JC Penney attached to the petition for reconsideration the final report of the investigator assigned by the office of the Disciplinary Administrator to investigate Sheldon and Wohlford's complaint against Terrill (“the investigator's report”) and the letter from the office of the Disciplinary Administrator informing Sheldon and Wohlford that the Review Committee of the Kansas Board for Discipline of Attorneys had found “there was not sufficient evidence to prove a violation of the [KRPC].”
The investigator's report, file-stamped as received by the office of the Disciplinary Administrator on August 20, 2013, is a 43–page document that addresses the nature of the complaint, the scope of the investigation, the evidence considered, and the primary allegations of misconduct and makes findings of fact, conclusions, and recommendations. Ultimately, the investigator concluded that there was not reasonable grounds to believe Terrill violated the KRPC. In the report, the investigator explicitly expressed his concern over what he called “unsupported and inflammatory issues” and allegations the COTA judges made in the October 2012 Lyerla order. The investigator noted that Wohlford and Sheldon acknowledged in statements to him that they had no evidence of at least some of the misconduct they alleged. Even more pertinently, the investigator's report stated as part of the conclusion and recommendations:
“The lack of evidence as to many of the allegations; the inclusion of inflammatory allegations or suggestions totally unsupported by any evidence; the reliance on statistics as to COTA cases without comparison to such statistics of other courts, as well as the preparation of legal and factual arguments prior to the September 18, 2012, show cause hearing suggest a bias or pre-determination by the COTA judges, complainants therein.”
After the County filed a response to JC Penney's petition for reconsideration, COTA denied the petition. Regarding the challenge to the valuation holding, COTA merely stated that “the valuation issues contained in the Petition for Reconsideration were previously raised by [JC Penney] in its post-hearing briefs and fully addressed by the Court in its original Order. ” COTA then turned its attention to JC Penney's assertion that its failure to recuse was error. COTA first noted that only one judge who participated in the decision in the instant case was involved with the disciplinary complaint against Terrill; it asserted that even if that judge—Sheldon—had erred by failing to recuse himself, the remaining two judges on the panel would have ruled the same way. This, according to COTA, was alone sufficient reason to reject JC Penney's argument that the failure to recuse was error.
JC Penney filed a petition for judicial review with this court in May 2014 and filed its appellate brief in September 2014. On October 17, 2014, another panel of this court issued its opinion in Lyerla. Lyerla, 50 Kan.App.2d 1012. The Lyerla court held that COTA had erred in dismissing the cases and that COTA exceeded the scope of its statutorily authorized authority when it considered and purported to decide (1) the validity of the contracts between the taxpayers and their representatives, (2) whether those representatives had been engaged in or assisted in the unauthorized practice of law, and (3) whether Terrill violated the KRPC. 50 Kan.App.2d at 1017–23.
Accordingly, the Lyerla panel reversed the dismissals, vacated COTA's findings and rulings on the subjects it had no authority to address, and remanded for further proceedings. 50 Kan.App.2d at 1023, 1027. The panel also addressed the issue of COTA's denial of the motion for recusal filed in Lyerla. This court ultimately concluded that the COTA judges' failure to recuse under the circumstances was unreasonable; this court ordered their disqualification from remand proceedings. 50 Kan.App.2d at 1025.
On February 27, 2015, another panel of this court issued its opinion in the appeal from COTA's actions in Chrysler Building. See Chrysler Building, 2015 WL 967561, at *1. In Chrysler Building, this court again found that COTA had exceeded its authority by dismissing the cases and by inquiring into the validity of arrangements between the taxpayers and their representatives; the Chrysler Building court largely adopted and quoted the analysis and findings made by this court in Lyerla. See 2015 WL 967561, at *4–5. Likewise, the Chrysler Building court adopted and quoted at length Lyerla's reasoning and conclusions on the question of whether the COTA judges erred by denying the taxpayers' motion to recuse. See 2015 WL 967561, at *5–7. The Chrysler Building court concluded that the COTA judges' refusal to recuse was unreasonable and, “[u]pon remand of these cases, other judges must decide these issues.” 2015 WL 967561, at *7.
This complicated history brings us to the issue presently before this court: Did COTA err by denying JC Penney's motion to recuse and, if so, does that error require reversal? This court reviews COTA decisions under the guidance of the Kansas Judicial Review Act (KJRA), K.S.A.2014 Supp. 77–601 et seq. See In re Property Valuation Appeals of Various Applicants, 298 Kan. 439, 446, 313 P.3d 789 (2013). As the party asserting error, JC Penney bears the burden of proving the invalidity of COTA's action. See K.S.A.2014 Supp. 77–621(a)(1). This court is authorized to grant relief only under certain circumstances; relevant here is the authorization to grant relief if COTA erroneously interpreted or applied the law, COTA was improperly constituted or otherwise disqualified, or COTA's action in denying the motion to recuse was otherwise unreasonable, arbitrary, or capricious. See K.S.A.2014 Supp. 77–621(c)(4), (6), and (8).
The Kansas Supreme Court has recognized three bases upon which a litigant may ground a request for recusal of a district judge: (1) K .S.A. 20–311d, (2) the Kansas Code of Judicial Conduct (KCJC), and (3) the Due Process Clause of the Fourteenth Amendment to the United States Constitution. State v. Sawyer, 297 Kan. 902, 906, 305 P.3d 608 (2013). The standard of review depends on which basis a litigant asserts. Here, in its motion to recuse, JC Penney based its request on the KCJC, specifically Rules 1.2 and 2.11(A). Although our Supreme Court has not clearly established a standard of review for the denial of motions to recuse based upon the KCJC, ‘ “[t]he interpretation of a Supreme Court rule, like the interpretation of a statute, is a question of law’ “ over which an appellate court has unlimited review. See Shamberg, Johnson & Bergman, Chtd. v. Oliver, 289 Kan. 891, 901, 220 P.3d 333 (2009). Because the KCJC is contained within the Supreme Court rules and resolution of the motion to recuse involves interpretation of the KCJC, this court has unlimited review of JC Penney's claim.
Like district court judges, COTA judges are required to comply with the KCJC. See K.S.A.2011 Supp. 74–2433(a). Within Canon 1 of the KCJC, Rule 1.2 mandates: “A judge shall act at all times in a manner that promotes public confidence in the independence, integrity, and impartiality of the judiciary, and shall avoid impropriety and the appearance of impropriety.” (2014 Kan. Ct. R. Annot. 759.) Comment 5 following the rule defines the test for “appearance of impropriety” as “whether the conduct would create in reasonable minds a perception that the judge violated this Code or engaged in other conduct that reflects adversely on the judge's honesty, impartiality, temperament, or fitness to serve as a judge.” (2014 Kan. Ct. R. Annot. 760.)
Within Canon 2 of the KCJC, Rule 2.11 states, in pertinent part, that “[a] judge shall disqualify himself or herself in any proceeding in which the judge's impartiality might reasonably be questioned.” (2014 Kan. Ct. R. Annot. 767.) “Impartiality” is defined under the KCJC as “absence of bias or prejudice in favor of, or against, particular parties or classes of parties, as well as maintenance of an open mind in considering issues that may come before a judge.” (2014 Kan. Ct. R. Annot. 754.) The nonexclusive list of circumstances that might trigger the duty to disqualify under Rule 2.11 includes when “[t]he judge has a personal bias or prejudice concerning a party or a party's lawyer.” See Rule 2.11(A)(1) (2014 Kan. Ct. R. Annot. 767).
As stated above, the panel of this court that decided Lyerla addressed whether COTA erred by denying the motion to recuse in those cases, and the panel that decided Chrysler Building adopted and quoted in large part this court's opinion in Lyerla. See In re Tax Appeal of Lyerla Living Trust, 50 Kan.App.2d 1012, 1023–26, 336 P.3d 882 (2014) ; In re Chrysler Building, L.L.C ., No. 110,792, 2015 WL 967561, *5–7 (Kan.App.2015) (unpublished opinion). The Lyerla court noted that COTA judges were required to follow the KCJC and specifically noted Rule 2.11. 50 Kan.App.2d at 1024. The Lyerla court went on to say:
“Personal bias does not include views held by a judge based on matters that arise during litigation or views on legal issues. State v. Foy, 227 Kan. 405, 411, 607 P.2d 481 (1980). But a hostile feeling, antagonism, or animosity toward one of the litigants or their attorney is a personal bias requiring disqualification. 227 Kan. at 411 ; see State v. Reed, 282 Kan. 272, Syl. ¶ 3, 144 P.3d 677 (2006). Merely reporting an attorney to disciplinary authorities for an apparent violation of attorney-ethics rules normally does not constitute personal bias; judges have a duty to report such issues in appropriate cases. See United States v. Mendoza, 468 F.3d 1256, 1261–63 (10th Cir.2006).
“In this case, however, we conclude that the impartiality of these judges might reasonably be questioned. Although the Court of Tax Appeals immediately signaled that it might lack the authority to consider the taxpayers' appeals at all, it launched an inquisition into matters well beyond the limited question of whether the real parties in interest were before it. More significantly, the judges unanimously concluded that the sworn testimony of Jerry Chatam and the representations of attorney Terrill lacked credibility. The taxpayers would reasonably wonder whether these judges could give them a fair hearing while Chatam and Terrill continued to provide the taxpayers representation on remand.
“In most cases, a judge's findings in the course of a lawsuit—even credibility findings—are not cause for disqualification. See Foy, 227 Kan. 405, Syl. ¶ 3. Here, however, the findings were that the chosen attorney and tax representative for these taxpayers lacked credibility—and the findings came in an inquiry initiated solely by the court itself that went far beyond its statutory authority. Under these facts, a reasonable person would question the ability of these judges to continue impartially in this case on remand. We therefore conclude that their disqualification should be ordered under K.S.A.2013 Supp. 77–621(c)(8) on the ground that their failure to recuse under these circumstances was unreasonable.
“A reasonable person, considering this situation, would look at whether the parties to this appeal—the taxpayers—could have confidence that the judges were, in fact, impartial. It is important that those appearing in our courts have confidence that they will receive a fair hearing. See In re Marriage of Underwood, No. 104,315, 2011 WL 6942931, at *5 (Kan.App.2011) (unpublished opinion); State v. Bennett, No. 96,591, 2008 WL 588138, at *2 (Kan.App.2008) (unpublished opinion); Tyler, Why People Obey the Law (2d ed.2006). We do not know that the judges in this case could not set aside their previous findings to provide a fair hearing on remand. We simply conclude that a reasonable person would justifiably lack confidence in their impartiality, and that's sufficient to make their failure to recuse unreasonable.” 50 Kan.App.2d at 1024–25.
In the instant case, COTA filed no orders that disparaged, undermined, or showed any partiality or bias against Terrill prior to JC Penney filing the motion for recusal. Yet, as demonstrated above, the instant case proceeded contemporaneously with Lyerla and Chrysler Building and the final decision in this case was signed by two of the COTA judges involved in Lyerla and Chrysler Building, including one judge who was involved in the disciplinary complaint filed against Terrill. The disciplinary complaint, as well as the orders in Lyerla and Chrysler Building, showed a personal bias against Terrill; indeed, the investigator's report expresses serious concern about this bias.
In considering JC Penney's petition for reconsideration, COTA correctly noted that it was not bound by the investigator's report. What COTA failed to recognize, however, is that recusal does not depend on a firm finding by a higher authority that a bias exists. As stated above, KCJC Rule 2.11 states that “[a] judge shall disqualify himself or herself in any proceeding in which the judge's impartiality might reasonably be questioned.” (2014 Kan. Ct. R. Annot. 767.) Although the actions and orders that might cause a reasonable person to question the impartiality of the COTA judges named in JC Penney's motion to recuse occurred in conjunction with Lyerla and Chrysler Building, the actions and orders were of such magnitude that this court cannot say that no reasonable person would question the judges' ability to remain impartial in JC Penny's case. Thus, as recognized in Lyerla and Chrysler Building, we conclude the judges' denial of the motion to recuse in the instant case was unreasonable.
The COTA valuation order being appealed by JC Penny was signed by Judges Sheldon, Cooper, and Mason. Of these three judges, JC Penny's motion to recuse applied only to Sheldon and Cooper. The County asserts that even if the two judges had recused, the remaining judge—who was not involved in the orders in Lyerla and Chrysler Building or in the disciplinary complaint—would have ruled the same way. Even if that were true, it would not save COTA's ruling, since statutorily, COTA needs a quorum of two judges to issue a final order. See K.S.A.2011 Supp. 74–2433(a).
COTA cited the rule of necessity in denying JC Penney's motion to recuse. As this court noted in Lyerla and Chrysler Building, however, there were potential statutory avenues by which substitute judges could have been appointed. See K.S.A.2011 Supp. 74–2433 ; Lyerla, 50 Kan.App.2d at 1026 ; Chrysler Building, 2015 WL 967561, at *7. In any event, it appears the makeup of COTA—now the Board of Tax Appeals (BOTA)—has changed even further since the hearing on JC Penny's appeal occurred in June 2013. Thus, the rule of necessity failed to justify COTA's denial of JC Penny's motion to recuse.
COTA also cited the doctrine of extrajudicial source in its denial of the motion to recuse. That doctrine states that court proceedings or judicial rulings generally cannot form the grounds for future disqualification of a judge on the basis of bias or prejudice. See In re Platt, 269 Kan. 509, 531, 8 P.3d 686 (2000). As this court noted in Lyerla, however, the circumstances here and interaction between COTA and Terrill went beyond the norm. “[T]he findings were that the chosen attorney and tax representative for these taxpayers lacked credibility—and the findings came in an inquiry initiated solely by the court itself that went far beyond its statutory authority.” Lyerla, 50 Kan.App.2d at 1024. Similarly, although filing a disciplinary complaint does not generally warrant recusal in future cases, the complaint filed here did not contain itself to alleged ethical violations in other cases. Indeed, as Judges Sheldon and Wohlford admitted, the complaint included allegations for which they had no evidentiary support. Taken as a whole, even in light of the general rule espoused in the doctrine of extrajudicial source, the relationship between Terrill and the COTA judges named in JC Penney's motion to recuse was so contentious that the doctrine of extrajudicial source does not excuse the denial of the motion.
Accordingly, it was error for COTA to deny the motion to recuse, which leads this court to the question of the appropriate remedy. Neither party cites any authority or even specifically opines on the appropriate remedy; JC Penney merely asks for “such relief as necessary.” It stands to reason, though, that this error requires reversal of the COTA valuation order and reconsideration of the merits of the case by different judges. When this court reviews COTA decisions, we do not reweigh evidence or pass on the credibility of witnesses; instead, we trust that the judges who reviewed the evidence and testimony firsthand fairly and accurately considered it. See In re Equalization Appeal of Tallgrass Prairie Holdings, 50 Kan.App.2d 635, 647, 333 P.3d 899 (2014). As we have stated, “[i]t is important that those appearing in our courts have confidence that they will receive a fair hearing. [Citations omitted.]” Lyerla, 50 Kan.App.2d at 1025.
At oral argument, the parties agreed that Sheldon and Wohlford are no longer members of BOTA and Lee is no longer a hearing officer. This leaves Cooper as the only existing BOTA member subject to JC Penny's motion to recuse. For all the reasons stated herein, we conclude that COTA's order affirming the appraised value of JC Penney's property must be reversed and the case remanded for rehearing before BOTA members other than Cooper. Because we are remanding for a new hearing before different BOTA members, we will not reach the merits of JC Penney's other claims on appeal.
Reversed and remanded with directions.