SC Administrative Law Court Decisions

STATEMENT OF THE CASE

This matter is before the Administrative Law Court (ALC or Court) pursuant to S.C. Code Ann. § 12-60-2540 (Supp. 2003), S.C. Code Ann. § 12-43-220 (Supp. 2003), and S.C. Code Ann. §§ 1-23-310 et seq. (1986 & Supp. 2003), in which the Petitioner is challenging the denial by the Horry County Assessor (Respondent or Assessor) of a four percent (4%) special assessment ratio for property known as 4668 Little River Road, Little River, South Carolina (Property) for tax year 2003. A hearing was held before me in Columbia, South Carolina on September 29, 2004. Pursuant to a motion by Petitioner (which stated that Petitioner was 100 percent disabled), this Court issued an Order on July 27, 2004 which authorized Petitioner’s father, Malcolm McFall Babb, to represent Petitioner in this case as his next friend. Petitioner was not present at the hearing nor did he present any testimony or evidence to the Court.

After carefully weighing all the evidence, I find and conclude that the request by Petitioner to have the special residential assessment ratio of four percent (4 %) apply to the Property for the tax year 2003 is denied.

FINDING OF FACT

Having observed the witnesses and exhibits presented at the hearing and closely passed upon their credibility, taking into consideration the burden of persuasion by the parties, I make the following Findings of Fact by a preponderance of the evidence:

General

1.The ALC has personal and subject matter jurisdiction.

2.Notice of the date, time, place and subject matter of the hearing was timely given to all parties.

Property

3.On August 28, 1987, Cedar Creek Village, Inc., deeded to “M. McFall Babb” the property designated as Lot Nine (9), Block C, Cedar Creek Village, Little River Township, Horry County, South Carolina. The lot was sold for the sum of One Hundred Seven Thousand Five Hundred and No/100 ($107,500.00) Dollars. The deed was recorded in the office of the Clerk of Court for Horry County, South Carolina on October 16, 1987 in Deed Book 1170 at page 282. The Property is identified herein as 4668 River Road, Little River, South Carolina and has Tax Map Number 131-05-06-002.

4.During the calendar year 1990, a house was built on the Property. Petitioner’s father,

Malcolm McFall Babb (“Mac Babb”), testified that Petitioner purchased the Property and paid for the house to be constructed on it with his own trust funds. However, no proof was provided of the source of the funds used to purchase the lot or construct the house.

Special Assessment Application

5.On January 10, 1989, an application for special residential assessment (legal residence) for the Property for the tax year 1990 was filed with the Assessor’s Office. The name typed in the application was “M. McFall Babb.” The cursive signature on the application is not completely legible. In the application, the applicant stated that the Property was his legal residence and that his mailing address was the same as the Property. Furthermore, the signatory noted that no part of the Property was rented or included an apartment. The Property was qualified by the Assessor’s Office for the four percent (4%) special residential assessment ratio on January 24, 1990 for the 1990 tax year.

6.On December 2, 1991, check #0753 was made payable to “Johny C. Allen - County Treasurer” for the property taxes on the Property in the amount of One Thousand Six Hundred Nineteen and 76/100 ($1,619.76) Dollars. It was signed in cursive by “Mitchell M. Babb” and drawn on The Citizens & Southern National Bank of South Carolina at Columbia, South Carolina. No home address was either preprinted or written in on the check.

7.On December 22, 1992, check #1144 was made payable to “Johny C. Allen - County Treasurer” for the property taxes on the Property in the amount of One Thousand Six Hundred Sixty-Five and 24/100 ($1,665.24) Dollars. It was signed in cursive by “Mitchell Babb” and drawn on The Citizens & Southern National Bank of South Carolina at Columbia, South Carolina. Again, no home address was either preprinted or written in on the check. This check also does not list the property for which the taxes were paid.

8.On January 7, 2004, M. McFall Babb, signing as “Mitch Babb,” signed and filed an application with the Assessor’s office for the special residential assessment of four percent (4 %) for the Property for the tax year 2003. The application lists the property as the residence of M. McFall Babb and his mailing address is listed as the Property. The application further states that the Property was not rented and that it did not have any apartments. The telephone number listed for the taxpayer was 843-249-3700.

9.The Assessor sent a letter to “M. (Mitch) McFall Babb” at 4668 River Road, Little River, South Carolina on January 9, 2004 denying the request for the special residential property tax assessment for the tax year 2003. The Assessor returned check # 721943 to Petitioner in the amount of Two Thousand One Hundred Fifty-Four and 50/100 ($2,154.50) Dollars. The Assessor stated in the letter that his office could not determine whether Petitioner or his father, Malcolm McFall Babb, owned the Property. Petitioner was told he could appeal the denial to the Horry County Board of Assessment Appeals (Board).

10.On February 5, 2004, Petitioner appealed the denial of the four percent (4 %) special residential property tax assessment for the tax year 2003 to the Board. The Board held a hearing on the request on February 26, 2004. It sent a letter dated March 9, 2004 to Petitioner in which it affirmed the decision of the Assessor and stated that it “believes that a new deed is needed for clarification indicating Mitchell McFall Babb as owner of referenced property.” Petitioner’s father, acting as agent for Petitioner, appealed the Board’s determination to this Court.

11.On February 13, 1990, Petitioner applied to the Horry County Probate Court for a

marriage license to marry Kathy Ann Cosmen. He listed his name on the application as Mitchell McFall Babb and signed the application in cursive as “Mitchell McFall Babb.” On the license and certificate for marriage, Petitioner signed his name in cursive as “Mitchell M. Babb.” On both documents, Petitioner listed his address on the application as 1300 Parkhill Drive.

12.Petitioner’s father testified that on February 6, 1994, Petitioner had a stroke and has been disabled ever since. Mitchell McFall Babb was issued an identification card by the South Carolina Department of Public Safety on March 20, 2003. The ID number on the card is 008075100, and it has an expiration date of March 20, 2008. His birth date is listed on the card as July 2, 1962, and his address is listed as 4668 River Rd., Little River, SC 29566-7927. Petitioner signed the identification card by printing the name “Mitch Babb.”

13.Kathy Ann Rogers Babb filed an action for divorce from Mitchell McFall Babb, Sr.,

in the Family Court for Horry County on April 4, 1997. See Docket No. 97-DR-26-901. In the action, Petitioner’s address is listed in the certificate of service as “Clear [Clare]Towers, Apt. 6-D, 1041 Marion Street, Columbia, SC 29201.” Petitioner acknowledged receipt of the summons and complaint in the divorce cause of action by printing the name on the return receipt “Mitch Babb.”

14.Petitioner filed a Financial Declaration in the divorce action. On August 8, 1997, Petitioner printed “Mitch Babb” on the signature line of the Financial Declaration. His signature was witnessed and probated by his attorney in the divorce action, William M. Bruner.

15.In this Financial Declaration, Petitioner listed a monthly income of Seven Hundred and Ninety-Five and No/100 Dollars ($795.00), which consisted solely of social security disability benefits. Petitioner also swore that he had cash of Fifteen and No/100 Dollars ($15.00), had a checking account with a balance of Seven Hundred and No/100 Dollars ($700.00) and had no interest in any real estate. The Financial Declaration further stated that Petitioner resided with his brother and paid rent in the amount of $400.00 each month.

Under the paragraph captioned “Marital Assets Addendum,” Petitioner swore that he did not jointly own any assets with his wife. The Financial Declaration was filed with the Horry County Family Court.

16.In the final divorce decree of The Honorable Lisa A. Kinon dated August 29, 1997, the Court found that the parties had jointly purchased, prior to their separation, a time share unit at Peppertree Resort. The Court awarded ownership of it to the wife, without objection by Mr. Babb.

17.In its “Findings of Fact,” the court found that Petitioner “resides in Horry County and/or Richland County.”

18.Petitioner has signed affidavits, filings and documents with this Court since the institution of this action. In each instance, his name is typed as Mitchell McFall Babb or M. McFall Babb. However, Petitioner has signed each document by printing his name as either “Mitch Babb” or “Mitch M. Babb.”

19.On September 8, 2004, Petitioner executed a Durable Power of Attorney to his father, Malcolm McFall Babb. He initialed each page with the letters “MB” and signed each by printing his name as “Mitch Babb” above his typed name, Mitchell McFall Babb. William Isaac Diggs, an attorney in Myrtle Beach, South Carolina, acting as a notary public, took the acknowledgement of one of the two witnesses to the Power of Attorney.

Other

20.A photocopy of one page from a local telephone directory lists the telephone number 249-3700 for “Mac Babb” at 4668 River Road, Little River, South Carolina. There is no telephone listing for a Mitchell Babb, Mitchell McFall Babb or a Mitch Babb. See Respondent’s Exhibit # 5.

21.Records from the office of the Secretary of State for South Carolina lists Brenda R. Babb, wife of Malcolm M. Babb and stepmother of Petitioner, as the registered agent for Condo Services, Inc, a South Carolina corporation, with an address of 4668 River Road, Little River, South Carolina 29566. See Board’s Exhibit # 16, which was filed with the Court on June 1, 2004.

CONCLUSIONS OF LAW

Based upon the foregoing Findings of Fact, applicable law, and the evidence placed into the Record, I conclude the following as a matter of law:

1.S.C. Code Ann. § 12-60-2540 (Supp. 2003) authorizes the Administrative Law Court to hear this contested case pursuant to Chapter 23 of Title I, as amended.

2.For taxation purposes, the value and ownership of property is established for tax years as of December thirty-first of the preceding year. See S.C. Code Ann. § 12-37-900 (1976).

3.S.C. Code Ann. § 12-43-220 (Supp. 2003) states that the four percent (4%) residential classification is applicable to a property when it is the legal residence of the taxpayer and does not contain more than five acres contiguous thereto. The statute further provides that the property must be “owned totally or in part in fee or by life estate and occupied by the owner of the interest….” (emphasis added). Also, the statute states that “the owner-occupant must have actually owned and occupied the residence as his legal residence and been domiciled at that address for some period during the applicable tax year.”

4.“Own” means “to have or possess as property; to have legal title to.” Blacks Law Dictionary 1130 (7^th ed. 1999). “Occupancy” is defined as “the act, state, or condition of holding, possessing, or residing in or on something; actual possession, residence, or tenancy, esp. of a dwelling or land.” Blacks Law Dictionary 1108 (7^th ed. 1999).

5.In civil cases generally, the burden of proof rests upon the party who asserts the affirmative of an issue. 29 Am. Jur. 2d Evidence §127 (1994); Alex Sanders, et al., South Carolina Trial Handbook §9:3 Party With Burden, Civil Cases (1994). Petitioner is the party asserting the affirmative in this case. Therefore, the Petitioner must prove by a preponderance of the evidence that he owned and occupied the Property as his legal residence during the 2003 tax year in order to qualify for the special four percent (4 %) residential classification and assessment.

6.The preponderance of the evidence “is evidence which is of the greater weight or more convincing than the evidence which is offered in opposition to it ....” Black’s Law Dictionary 1182 (6th ed. 1990). “The preponderance of the evidence means such evidence as, when considered and compared with that opposed to it, has more convincing force and produces in the mind the belief that what is sought to be proved is more likely true than not true.” Sanders, supra, §9:5, Quantum of Evidence in Civil Cases (1994)(citing Frazier v. Frazier, 228 S.C. 149, 89 S.E. 2d 225 (1955)). By virtue of Petitioner’s request for a contested case hearing, he has an obligation to defend his position and meet his burden of proof.

7.The trier of fact must weigh and pass upon the credibility of the evidence presented. S.C. Cable Television Association v. Southern Bell Tel. and Tel. Co., 308 S.C. 216, 417 S.E.2d 586 (1992).

8.In an affidavit dated February 3, 2004 (which was an attachment to his appeal to this Court requesting the hearing), Petitioner swore that he was one hundred percent (100%) disabled due to a massive stroke and had designated his father, Mac Babb, to appear as his agent with “full authority to act and speak on [his] behalf.” Petitioner later filed with this Court a Durable Power of Attorney dated September 8, 2004, which authorized his father (in paragraph 6) to prosecute in administrative hearings which involved him. Subsequently, by Order dated July 27, 2004, this Court allowed Petitioner’s father to represent Petitioner in this case. Although Petitioner failed to appear at the hearing and did not offer his testimony or submit any evidence as to the ownership of the Property, the Court allowed his father to represent his interest at the hearing, to offer his own testimony and to offer documentary evidence. At the conclusion of the hearing, the Court requested copies of records on file with the Family Court of Horry County to be forwarded for inclusion in the file.

9.SCRE Rule 201 authorizes this Court to take judicial notice of adjudicative facts. A Court can take judicial notice of its own records, files, and proceedings for all proper purposes including facts established in its records. Freeman v. McBee, 280 S.C. 490, 313 S.E.2d 325 (Ct. App. 1984). Furthermore, it can take judicial notice of records from other court files. This Court thus takes judicial notice of all family court records filed with the Court subsequent to the hearing, and as requested by this Court.

10.The Court finds that Petitioner has not met his burden in proving that he is the owner of the Property. Although Petitioner’s father testified that Petitioner used his “trust funds” to purchase the Property and construct the house on it, no evidence was placed into the Record substantiating the existence of such a trust fund or of any payments by Petitioner from his independent funds for the purchase of the lot or the construction of the house. The only evidence of such was the testimony of Petitioner’s father.

Petitioner’s father acknowledged that he and his wife live in a rental property in North Carolina. However, he also testified that both he and his wife, who provides court reporting services in South Carolina, maintain their offices at the Property. Furthermore, a page in the local telephone directory lists the name of Mac Babb for the telephone number at the address of the Property.

No independent or documentary evidence and no third party testimony was provided to the Court to show that Mitchell McFall Babb owned or occupied the Property. Thus, the Court must look at the most competent evidence in the Record in making its determination. Since the testimony of Petitioner’s father was self-serving, since Petitioner himself offered no testimony, and neither he nor his father placed in the record any proof of their income or assets at the time the lot was purchased or the house constructed, the reliable evidence in the Record which this Court must look to in making its decision is the sworn filings made by Petitioner in his divorce action. When he signed the Financial Declaration on August 8, 1997 as “Mitch Babb,” stating that he had no ownership interest in any real estate, his intent was to have it filed with the Court as his sworn statement. Furthermore, the Financial Declaration was a part of the official Court Record.

This Court notes that Petitioner did not appear before this Court and the Court has only affidavits purportedly signed by him and the testimony of his father as to Petitioner’s ownership interest in the Property. There is no third party or outside source corroboration. The Record reflects that Petitioner’s father is a man of substantial financial assets and would most probably be the person with the ability to purchase the Property and have the house built. However, the Record reflects that when Petitioner appeared before the family court judge he swore that he had no trust funds, no ownership in real estate, and no monies except for Seven Hundred and No/100 Dollars ($700.00) in his checking account. Furthermore, Petitioner averred in the Financial Declaration that he paid rent monthly in the amount of Four Hundred Dollars and No/100 ($400.00).

Accordingly, Petitioner has failed to prove by a preponderance of the evidence that he is the owner and occupier of the Property. Therefore he is not entitled to the special 4% residential classification for the tax year 2003. Notwithstanding a different classification of this property for taxation purposes in previous years, the bedrock principle in tax law is that each tax year must be judged independently from any other tax year. A property tax liability arises from a specific tax year as the result of an annual valuation of December 31 of the year preceding the tax year under consideration. S.C. Code Ann. §12-37-900 (2000); Atkinson Dredging Co., v. Thomas, 266 S.C. 361, 223 S.E.2d 592 (1976). An assessor has the authority to grant or deny requests for residential classifications. S.C. Code Ann. §12-43-220(c) (Supp. 2003). It follows that, in the absence of a prohibiting statute, the assessor is authorized to remove the classification since the authority to grant a status carries with it the authority to remove the status. See 53 C. J. S. Licenses § 51 (1987); S.C. Code Ann. 12-37-90 (g) (Supp. 2003). As the general rule explains, the removal is allowed only where no other statute prohibits the removal.

ORDER

Based upon the above Findings of Fact, Conclusions of Law, it is hereby

ORDERED that the Assessor deny the special four percent (4%) residential classification for the tax year 2003 for the Property, which is known as 4668 River Road, Little River, South Carolina.

AND IT IS SO ORDERED.

__________________________________

MARVIN F. KITTRELL

Chief Administrative Law Judge

January 13, 2005

Columbia, South Carolina