Tax

Issues: Constitutional challenge to residential property taxes; Meadowbrook Vill. Assocs. v. Auburn Hills; Circuit court jurisdiction; Ammex, Inc. v. Department of Treasury; The Tax Tribunal's jurisdiction; MCL 205.731; Prayer Temple of Love v. Wayne Cnty. Treasurer; Kostyu v. Department of Treasury; Johnston v. Livonia

Court: Michigan Court of Appeals (Unpublished)

Case Name: Bastuba v. City of Farmington Hills

e-Journal Number: 57512

Judge(s): Per Curiam – O'Connell, Fitzgerald, and Markey

 

The Tax Tribunal properly determined that it lacked subject-matter jurisdiction over the petitioner's claims regarding "the legality and constitutionality of the imposition of tax against his residential property." The petitioner did not challenge respondent-city's calculation of the assessed and taxable property values or the amount of tax assessed. The Tax Tribunal "'has original and exclusive jurisdiction over those tax issues which involve the accuracy and methodology of the property tax assessment' imposed under the property tax laws." However, it "'has no jurisdiction to hold statutes invalid or to consider constitutional matters.'" Instead, "'the circuit court has jurisdiction to consider such matters.'" Affirmed.

 

Full Text Opinion

Issues: Real property assessment; "True cash value" (TCV); MCL 211.27(1); Methods of "fair market" valuation; Meadowlanes Ltd. Dividend Hous. Ass'n v. Holland; Review of Tax Tribunal (TT) decisions; Wexford Med. Group v. City of Cadillac; "Substantial evidence"; Leahy v. Orion Twp.; The burden of proof; MCL 205.737(3); The TT's duty to determine the most accurate valuation under the individual circumstances of the case; President Inn Props., LLC v. Grand Rapids; Whether the TT used "an arbitrary and capricious" valuation standard; Bullington v. Corbell; Whether the petitioner's due process rights and rights under the Ninth Amendment of the U.S. Constitution were violated; City of Dearborn v. Freeman-Darling, Inc.; Abandonment of claim that an unconstitutional "taking" occurred by failing to cite supporting authority; Peterson Novelties, Inc. v. City of Berkley

Court: Michigan Court of Appeals (Unpublished)

Case Name: Holland Land Co., L.L.C. v. City of Taylor

e-Journal Number: 57511

Judge(s): Per Curiam – Borrello, Servitto, and Beckering

 

Rejecting the petitioner's claim that the TT used an arbitrary or capricious valuation standard, and concluding that competent, material, and substantial evidence supported its determinations of the property's value, the court affirmed the TT's order assessing the property for the 2010-12 tax years. The hearing referee found a 2010 TCV of $151,600, a 2011 TCV of $159,800, and a 2012 TCV of $156,800. The TT affirmed the referee's findings. The court initially noted that, "contrary to petitioner's suggestion that MCL 211.27 allows for an arbitrary calculation" of TCV, the Legislature supplied direction for determining TCV in MCL 211.27(1). While the Legislature provided a broad definition of TCV and "'listed a variety of factors to be considered in the valuation determination,'" it "'did not direct that specific methods be used.'" The Michigan Supreme Court summarized the approved methods of fair market valuation in Meadowlanes. In claiming that the TT's decision here was arbitrary and capricious, petitioner referenced a prior dispute involving the property as to tax years 2006-09, in which the TT used a "cost-less-depreciation" approach to valuation. However, the fact that the TT "previously valued petitioner's property by utilizing the cost-less-depreciation method of assessment did not render arbitrary or capricious its use of a different valuation approach" for the 2010-12 tax years, especially when it pursued another court-sanctioned method of determining the property value, the "sales-comparison or market" method. The TT "is not required to use the same valuation method in every instance" - it is only required to determine the property's TCV, which was what it did here. The TT considered the evidence about a comparable property that petitioner submitted for the 2010 tax year. In reaching the 2011 and 2012 assessment amounts, it "relied on detailed sales comparison analyses that respondent submitted," which the TT deemed accurate and reliable. "Although petitioner introduced evidence of two allegedly comparable property listings relevant to the 2011 and 2012 tax years, it offered no sales-comparison analysis or analysis illustrating another recognized method for ascertaining property values." Because "more than a scintilla of evidence" supported the TT's findings of fact, the court deemed them conclusive. Petitioner failed to show that anything relating to the valuation of its property violated its constitutional right to due process or rights under the Ninth Amendment, and abandoned its "taking" claim.

 

Full Text Opinion

Issues: Successor liability; MCL 205.27a(1); STC, Inc. v. Department of Treasury; Mackey v. Department of Human Servs.; Review of Tax Tribunal (TT) decisions; Podmajersky v. Department of Treasury; Credibility determinations; Detroit Lions, Inc. v. City of Dearborn; Statutory interpretation; Ford Motor Co. v. City of Woodhaven; Lafarge Midwest, Inc. v. Detroit; Fair market value (FMV); Market value (MV)

Court: Michigan Court of Appeals (Unpublished)

Case Name: PJ Hospitality, Inc. v. Department of Treasury

e-Journal Number: 57525

Judge(s): Per Curiam – Donofrio, Gleicher, and M.J. Kelly

 

Because the TT did not commit an error of law or adopt a wrong legal principle and its factual findings were supported by competent, material, and substantial evidence, the court affirmed the TT's opinion and judgment upholding the respondent's assessment of successor liability to petitioner. Before 2007, SC owned a restaurant. C in turn owned SC. In 2007, petitioner, also owned by C, purchased all of SC's business. Respondent assessed petitioner with SC's Michigan tax liability on the basis of it being a successor entity under MCL 205.27a(1). The referee concluded that respondent's assessment was proper. The court held that it was undisputed that petitioner was liable for SC's liability because "it did not escrow any funds in conjunction with the business purchase. While normally, petitioner's liability would have been limited" to the FMV of the business acquired, petitioner offered no evidence of the MV. Finally, the existence of any superior federal tax liens was "of no consequence because the statute only allows for any offset of successor liability when proceeds from the sale are applied to such superior liens," and there was no evidence that any part of the proceeds were applied in this manner.

 

Full Text Opinion
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