Tax assessment for personal, industrial property purchased in an asset purchase; Review of the Tax Tribunal’s (TT) final decision; Detroit Lions, Inc. v. City of Dearborn; Podmajersky v. Department of Treasury; The TT’s decision to exclude an appraisal; Georgetown Place Co-op v. City of Taylor; “True cash value” (TCV) defined; MCL 211.27(1); The TT’s decision not to consider the valuation by the parties in the recent sale of the property; Antisdale v. City of Galesburg; MCL 211.27(6); Jones & Laughlin Steel Corp. v. City of Warren; Claim that respondent and the TT both failed to account for the economic conditions at the time of the assessment; Taxable value (TV)

The court held that the petitioner did not show reversible error in the TT’s decision to exclude an appraisal. Also, the TT did not err in assessing the TCV of the personal, industrial property at $6,219,900 and the TV at $3,109,950. Petitioner purchased the equipment during its asset purchase of Len Industries in 2011. An appraisal was conducted for petitioner in anticipation of the asset purchase. It concluded that the machinery and equipment of Len “had a forced liquidation value of $4,916,950, and an orderly liquidation value of $6,632,250.” The TT excluded the appraisal, finding that petitioner “failed to provide the proper foundation, as the authors of the appraisal were not present to testify.” It also found that the appraisal was not relevant in determining the TCV of the property. Petitioner argued that the appraisal was relevant and the TT should have admitted it. Petitioner claimed that it “did not offer the appraisal for the truth of the matter asserted, i.e., as proof of the true value of the equipment.” Rather, it claimed “the appraisal was offered for a non-hearsay purpose, namely, ‘to corroborate the facts used by’” W, the director of finance for petitioner, in making a purchase offer for Len’s assets. Petitioner explained that the “appraisal set forth the complete description of the equipment and corroborated pertinent facts in the private sale transaction. However, significant evidence was adduced regarding the purchase of the property, including the factors petitioner relied on in making the offer.” W testified that “petitioner relied on the 12-month trailing earnings statement to determine what type of income the business could generate, the client mix, the location, and the management skill” of Len. The “asset purchase agreement was admitted into evidence, and it not only detailed the purchase price, but also included a working capital statement.” Thus, the appraisal was repetitious. As to the TCV, petitioner’s argument rested on the “flawed premise” that “a purchase price is necessarily determinative” of the TCV of personal property. “While the purchase price may be evidence of” TCV if it is “an arms-length transaction, it is not determinative of” TCV. The TT’s ruling comported with Jones. It “considered the sale, the deficiencies in petitioner’s evidence, and ultimately concluded that the sales price was not indicative of value.” Affirmed.