Opinion
No. FST CV04 4000371 S
September 7, 2005
MEMORANDUM OF DECISION
This is an application in the nature of an appeal from the Board of Assessment Appeals (BAA) of the defendant City of Norwalk brought by the plaintiffs, Eric L. Trujillo and Margaret A. Trujillo. The appeal is filed pursuant to the provisions of Conn. Gen. Statutes § 12-117a, claims overvaluation of the plaintiffs' residence in the Rowayton section of Norwalk, and that the assessment does not represent 70% of the property's true and actual value on the assessment date of October 1, 2003. They seek a reduction in the valuation on the assessment list of October 1, 2003 and on all Grand List years subsequent to October 1, 2003 in the same revaluation cycle, and reimbursement or credit by the defendant for any overpayment of taxes, together with interest and costs awarded by the court.
In March 2004 the plaintiffs received a notice from the defendant's assessor that the full market value of their residence on October 1, 2003 was $1,334,200 and that, at 70% of market value, the assessed value was $933,940. The plaintiffs, claiming to be aggrieved by the doings of the assessor, duly appealed to the BAA which reduced the full value of the property to $1,240,700 and the assessed value to $868,490. Contending that the revised assessment still did not represent 70% of the true and actual value of their property as of October 1, 2003, the plaintiffs filed this appeal.
The subject property consists of a single family residence situated on a .29-acre lot located at the corner of Sammis Street and Bluff Avenue in the Rowayton section of Norwalk. The site and its use is legally conforming to zoning, and is approximately 100 to 150 yards from Long Island Sound, directly across Bluff Avenue from the Rowayton Yacht Club. The structure is a 24-year-old home of colonial design in good condition, containing 2,072 square feet of above-grade living area with seven rooms (four bedrooms) and three- and one-half baths. There is also a finished basement of 1,036 square feet, a porch, deck and two-car garage. It has a hot water heating system and no central air conditioning. The site's proximity to the water gives limited views of Long Island Sound from the corner of the master bedroom, from the deck above the garage, and partial views from ground level. The site itself is level with landscaping described by the defendant's appraiser as excellent. Exhibits admitted into evidence during the trial included photographs of the house and lot with its landscaping. The property does not have legal access to the water.
The assessor's card erroneously reports that the house is centrally air-conditioned. The court will address this issue later.
The Supreme Court has reiterated the legal tenets governing tax appeals brought pursuant to § 12-117a, stating that "the trial court tries the matter de novo and the ultimate question is the ascertainment of the true and actual value of the taxpayer's property . . . at the de novo proceeding, the taxpayer bears the burden of establishing that the assessor has over assessed its property." Torres v. Waterbury, 249 Conn. 110, 117, 733 A.2d 817 (1999).
At trial, the plaintiffs presented their appraiser, Michele A. Watson, a certified residential appraiser licensed by the State of Connecticut, which license she has held for approximately five-and-one-half years. Watson testified that the plaintiffs' property had a fair market value of $845,000 on October 1, 2003. Testifying for the defendant were the Assessor for the City of Norwalk, Kenneth Whitman, and Michael Fazio, a member of the Appraisal Institute and licensed by the State as a certified general real estate appraiser. He has been working as a full-time appraiser of real estate for 22 years. Fazio's opinion of market value of the subject property as of October 1, 2003 is $1,300,000, which exceeds the assessor's figure of $1,240,700, reduced from $1,334,200 after the BAA's decision.
Both appraisers testified they relied primarily on the comparable sales approach to market value. They said they also considered the reproduction cost in reaching their opinions. "Gen. Statutes § 12-64 provides that all non-exempt real estate shall be liable to taxation at a uniform percentage of its present true and actual valuation . . . to be determined by the assessors. The terms `true and actual value' are defined in 12-63 to mean the fair market value thereof and not its value at a forced or auction sale. Fair market value is generally best ascertained by reference to market sales." Uniroyal v. Board of Tax Review, 174 Conn. 380, 385-86, 389 A.2d 734 (1978). "As a rule, however, no one method is controlling; consideration should be given to them all if they have been utilized, in arriving at the value of the property." (Citations omitted; internal quotation marks omitted.) Id., 386.
In applying the market sales approach, the plaintiffs' appraiser, Watson, utilized three comparable sales in the Rowayton area, as did the defendants' appraiser, Fazio. All of Watson's comparables are more distant from the subject property than Fazio's most distant comparable. Watson's comparables numbers 2 and 3 are .45 miles and .44 miles, respectively, from the subject property, with her comparable number 1 being more than 3/4 of a mile away. Fazio's most distant comparable is .31 miles from the subject, while the other two comparables are .05 miles and .04 miles away.
Both appraisers agreed that location, in a waterfront community such as Rowayton, is of primary importance, including proximity to the water. Both made meaningful adjustments to the comparable sales prices to arrive at a weighted average. In arriving at value through the cost approach method, Watson used an estimated reproduction cost for the dwelling of $150 per square foot, $60 per square foot for the finished basement, and $30 per square foot for the garage. These figures were based on "standard costs." Fazio assigned $175 per square foot to the dwelling, $75 per square foot to the basement, and $50 per square foot to the garage. He used Marshall Valuation Service, a recognized volume, for his construction costs as well current construction and development cost data provided by builders, contractors and subcontractors in the local market.
After applying depreciation, the plaintiffs' appraiser found an indicated value by the cost approach of $851,900, but relying more on her comparable sales, assigns a market value of the subject property of $845,000. After depreciation, the defendant's appraiser gives a figure of $1,337,397 by the cost approach, but also giving more weight to the comparable sales method, assigns a final estimated value of $1,300,000 to the subject property.
"A trial court is free to accept the expert testimony of one party and to reject that of the other. This is a `proper exercise of the trier's function . . .' when the evidence to which the greater credence was given is not unreasonable." Connecticut Light and Power Co. v. Monroe, 149 Conn. 450, 455, 181 A.2d 181 (1962). The court gives more credence to the testimony and the appraisal report of MAI Fazio then that of the plaintiffs' appraiser. The court finds his comparable sales more similar to the subject property by virtue of their proximity to it and to the water. In his testimony, he properly recognized the important characteristic of location in a waterfront community and the water views, though limited, of the subject property. Moreover, the court found reasonable the adjustments to the sales prices of Fazio's comparables for date of sale, location, view, condition and size, resulting in the adjusted sales prices of the comparables and a final estimated value of the subject property of $1,300,000.
In their appeal to the BAA, the plaintiffs took no issue with the defendant's market value placed on the building; nor do they do so in this court appeal. Through the testimony of Mr. Trujillo, the plaintiffs ask the court to adopt a method of valuation which would reduce the market value of the land only, and result in a total market value of the property of between $820,000 and $840,000.
It must first be noted that the Supreme Court has "never held that a trial court in a de novo appeal pursuant to § 12-117a may determine the value of only a portion of a taxpayer's property." Konover v. Town of West Hartford, 242 Conn. 727, 737, 699 A.2d 158 (1997). In a 112-17a appeal, the ultimate question is not the value of separate segments of the taxpayer's property, but rather `the ascertainment of the true and actual value of the taxpayer's property.' National Amusements. Inc. v. Town of East Windsor, Superior Court, judicial district of New Britain, docket no. CV000503380 (February 10, 2003, Aronson, J.T.R.) ( 34 Conn. L. Rptr. 84) (citing Konover v. Town of West Hartford supra, 242 Conn. 744).
The plaintiffs argue that other properties on the same side of Sammis Street are larger than their property, and yet have land values, per 1/100th of an acre, lower than the subject property's land value. The plaintiffs suggest a method of valuation that would have the court take the mean of the land value per 1/100th acre of the properties on the same side of the street, and multiply this mean by each 1/100th acre of land area of the subject property. According to the plaintiffs, this would produce a land value of $422,270, which when added to the agreed value of the house of $399,500 results in total property value of $821,770.
The court must reject this method of valuation. The formula does not represent any recognized principle of valuation adopted by our courts, and is therefore not relevant to an assessor's statutory task of determining the fair market value of real estate for taxation purposes. Furthermore, the plaintiffs' method does not consider that municipal ordinances, such as zoning regulations, may restrict the uses of properties so that larger parcels are not necessarily more valuable than a smaller one. Nor does the formula recognize that proximity to the water and water views may substantially affect value in a waterfront community. It is also significant to note that the plaintiffs' appraiser neither refers to her clients' approach to land value in her appraisal report, nor was she asked by plaintiffs' counsel to endorse, subscribe to, or otherwise comment on the theory of valuation presented by Mr. Trujillo. "If the trial court finds that the taxpayer has failed to meet his burden because, for example, the court finds unpersuasive the method of valuation espoused by the [taxpayer], the trial court may render judgment for the town on that basis alone." (Citation omitted.) Torres v. Waterbury, supra, 249 Conn. 118.
In addition, the assessor, Whitman, testified that the neighboring properties referred to by Trujillo were incorrectly assessed without consideration being given to their partial water views which they do in fact possess.
"In a § 12-117a appeal, the trial court performs a two-step function. The burden, in the first instance, is upon the plaintiff to show that he has, in fact, been aggrieved by the action of the board in that his property has been over-assessed. In this regard, mere over-valuation is sufficient to justify redress under 12-117a, and the court is not limited to a review of whether an assessment has been unreasonable or discriminatory or has resulted in substantial over-valuation, Whether a property has been overvalued for tax assessment purposes is a question of fact for the trier. The trier arrives at his own conclusions as to the value of land by weighing the opinion of the appraisers, the claims of the parties in light of all the circumstances in evidence bearing on value, and his own general knowledge of the elements going to establish value . . ."
"Only after the court determines that the taxpayer has met his burden of proving that the assessor's valuation was excessive . . . may the court then proceed to the second step in a § 12-117a appeal and exercise its equitable power to grant such relief as to justice and equity appertains . . . If a taxpayer is found to be aggrieved by the decision of the [Board of Tax Review], the court tries the matter de novo and the ultimate question is the ascertainment of the true and actual value of the applicant's property. If the court finds that the property has been in fact overvalued, it has the power to, and should, correct the valuation." (Citations omitted; internal quotation marks omitted.) Konover v. Town of West Hartford, supra 242 Conn. 734-36. "A taxpayer . . . who fails to carry the burden of establishing over-valuation has no right to complain if the trial court accords controlling weight to the assessor's valuation of his property. Torres v. Waterbury, supra, 249 Conn. 118.
In this case, the court is persuaded, by the testimony and the exhibits in evidence, that the assessor has not overvalued the plaintiffs' property, and therefore that the plaintiffs have failed in their initial burden of showing they are aggrieved by the action of the BAA. In accepting the estimated property value of the defendant's appraiser of $1,300,000 rather than that of the plaintiffs' expert, and in rejecting the plaintiffs' own method of valuation, the court finds that the defendant's measure of true and actual value of plaintiffs' property, $1,240,700, is not an overvaluation.
Therefore, the plaintiffs' appeal is dismissed.
The assessor's field card erroneously notes that the house on the subject property is centrally air-conditioned, when it is not. The defendant's appraiser included this error in his appraisal report. The plaintiffs' appraiser, in her adjustments to comparable sales, valued this amenity at $10,000. Because the court has effectively found fair market value to be $1,300,000, almost $60,000 higher than the assessor's valuation, the error is harmless as it relates to the ultimate issue in this case, the plaintiffs' burden of proving overvaluation.
D'ANDREA, J.T.R.