Submitted January 23, 2018
from the Board of Tax Appeals, Nos. 2014-3748 and 2014-3749.
& Gillis Law Group, L.L.C., Mark Gillis, and Kimberly G.
Allison, for appellee Hilliard City Schools Board of
Sater, Seymour & Pease, L.L.P., Karen H. Bauernschmidt,
Nicholas Ray, and Heather M. Lutz, for appellant.
1} In this real-property-valuation case, appellant,
UTSI Finance, Inc. ("UTSI"), appeals a Board of Tax
Appeals ("BTA") decision that valued UTSI's
property in accordance with a sale price. In assigning this
value, the BTA determined that UTSI's appraisal evidence
did not negate the presumption that the sale was
characteristic of true value. Because we conclude that the
BTA's decision is reasonable and lawful, we affirm it.
FACTS AND PROCEDURAL BACKGROUND
2} The subject property consists of two parcels
located on the west side of Columbus. The first parcel
consists of 3.160 acres of unimproved land. The second parcel
consists of 24.710 acres, part of which is improved with a 9,
600-square-foot industrial warehouse used for servicing
semitrailers. For tax year 2011, the Franklin County auditor
valued the first parcel at $132, 700 and the second parcel at
$1, 717, 300, for a total valuation of $1, 850, 000. Appellee
Hilliard City Schools Board of Education ("BOE")
and UTSI each filed original and countercomplaints against
these tax-year-2011 valuations, and the two cases were
consolidated for a hearing before the Franklin County Board
of Revision ("BOR").
3} At the BOR hearing, the BOE presented a quitclaim
deed memorializing a transfer of the subject property from
Lakeshore Ventures, L.L.C., to Universal Truckload Services,
Inc. The deed was signed and notarized in September 2002, but
it bears a stamp from the auditor's office dated March
2009. The BOE also presented the conveyance-fee statement
associated with this transfer, showing that the subject
property sold for $2, 313, 489. The statement was filed with
the auditor's office in March 2009. Relying on these two
documents, the BOE argued that the subject property should be
valued according to the sale price.
4} As additional support, the BOE provided copies of
the BOR's decision that assigned a value of $2, 313, 500
to the subject property for tax year 2009. The BOE asserted
that during the tax-year-2009 proceedings, the BOR determined
that the sale was arm's length in nature, and thus, it
insisted, UTSI was barred from contesting the
arm's-length nature of the transaction during the
5} For its part, UTSI presented the testimony of
Kelly Fried, a certified appraiser whose qualifications were
stipulated to by the BOE. Fried appraised only the second
parcel (the one improved with the industrial warehouse) as of
the January 1, 2011 tax-lien date, relying on both a
sales-comparison and an income approach to value to arrive at
a reconciled valuation of $1, 470, 000.
6} Fried commented on market trends, observing that
"there appears to be limited demand for similar
[properties] at the time of value as there appears to be an
excess supply of space in this area." More specifically,
she wrote that "demand for real property peaked around
2006 and then began to decline from late 2007 until leveling
off in late 2011/early 2012 due to economic conditions."
During this decline, she observed, vacancy rates started to
7} Fried's appraisal report additionally noted:
The property last transferred in March 3, 2009 from Lakeshore
Ventures LLC to Universal Truckload for $2.3 million in a
sale that the owner reported to be between related entities.
The majority owner of UTSI also owns Lakeshore Ventures.
There was an additional transfer in 2009 from Universal
Truckload to UTSI for no consideration in what was considered
to be a non-arm's-length transfer.
elaborated on this passage by testifying that the commonality
between the "related entities" was based on their
relationship to "Crown Enterprises." Fried never
identified the name of the "owner" who had reported
to her that the sale was between related entities, nor did
this owner testify. The BOE raised a hearsay objection to
Fried's reliance on her conversation with the owner, but
the BOR permitted her to testify on this topic.
8} Fried stated that the owner had told her that the
March 2009 sale included more than just realty. But Fried did
not specify what the nonrealty items may have been.
9} The BOR assigned a total value to the subject
property of $1, 602, 700 for tax years 2011, 2012, and 2013.
For the first parcel, the BOR retained the auditor's
valuation of $132, 700. For the second parcel, it assigned
Fried's opined value of $1, 470, 000. The BOR rejected
the BOE's argument that the March 2009 sale price
established the subject property's value, explaining that
changes in market conditions rendered the sale too remote.
10} The BOE appealed to the BTA, which heard the
case on the record developed before the BOR and on briefs
filed by the BOE and UTSI. The BTA determined that the
subject property's value should be $2, 313, 490 for tax
years 2011, 2012, and 2013. Although the BTA rejected the
BOE's argument that UTSI was collaterally estopped from
contesting the sale's arm's-length nature, the BTA
nevertheless found that the sale price presumptively
established the subject property's value and that UTSI
had failed to rebut that presumption by showing that the sale
was not a recent arm's-length transaction. The BTA held
that it could not rely on Fried's statement that the sale
was between related parties, because in its view, that
statement was hearsay. The BTA rejected UTSI's argument
that the sale took effect in September 2002, ruling instead
that the sale took effect for real-property-valuation
purposes in March 2009, the date the conveyance-fee
statement was filed. And the BTA rejected Fried's
analysis of changed market conditions as empirically
unsupported. UTSI then filed this appeal.
STANDARD OF REVIEW
11} We will affirm a BTA decision that is reasonable
and lawful. Satullo v. Wilkins, 111 Ohio St.3d 399,
2006-Ohio-5856, 856 N.E.2d 954, ¶ 14. We review de novo
the BTA's resolution of legal issues but will defer to
the BTA's findings concerning the weight of the evidence
if there is evidence in the record to support them. Lunn
v. Lorain Cty. Bd. of Revision, 149 Ohio St.3d 137,
2016-Ohio-8075, 73 N.E.3d 486, ¶ 13.
12} We begin with well-established principles. The
price from a recent arm's-length sale presumptively
establishes a property's true value pursuant to former
R.C. 5713.03, Am.Sub.H.B. No. 260, 140 Ohio Laws, Part II,
2665, 2722.E.g., Utt v. Lorain Cty. Bd. of
Revision, 150 Ohio St.3d 119, 2016-Ohio-8402, 79 N.E.3d
536, ¶ 9. To benefit from this presumption, the
proponent need only meet a relatively light initial burden to
show that the "sale on its face appears to be recent and
at arm's length." Cummins Property Servs., LLC
v. Franklin Cty. Bd. of Revision, 117 Ohio St.3d 516,
2008-Ohio-1473, 885 N.E.2d 222, ¶ 41. The proponent can
make this showing by furnishing " 'basic
documentation of a sale.' " Utt at ¶
13, quoting FirstCal Indus. 2 Acquisitions, LLC v.
Franklin Cty. Bd. of Revision, 125 Ohio St.3d 485,
2010-Ohio-1921, 929 N.E.2d 426, ¶ 24. When, for example,
the proponent provides a deed and conveyance-fee statement,
this requirement is met and the presumption arises. See
Dauch v. Erie Cty. Bd. of Revision, 149 Ohio St.3d 691,
2017-Ohio-1412, 77 N.E.3d 943, ¶ 17.
13} After the presumption arises, the opponent may
rebut it only by showing that the sale was either not recent
or not at arm's length. Cummins at ¶ 13. An
appraiser's opinion of value is not enough on its own to
overcome the validity of a sale price. Columbus City
Schools Bd. of Edn. v. Franklin Cty. Bd. of Revision,
146 Ohio St.3d 470, 2016-Ohio-757, 58 N.E.3d 1126, ¶ 20
("Buckeye Hospitality"). But an opponent
is permitted to rebut the presumed recency and
arm's-length nature of a sale by "rely[ing] on
information contained in an appraisal report and an
appraiser's testimony." Id. at ¶ 19.
With these principles in mind, we now take up the
The BOE did not preserve its ...