SC Administrative Law Court Decisions

These are contested cases brought by Petitioners, Michael and Marion Gannam, against the Jasper County Assessor (hereinafter referred to as "Assessor") concerning property valuations for property tax year 1996. The petitioners exhausted all prehearing remedies and requested a contested case hearing before the Administrative Law Judge Division (hereinafter referred to as "ALJD") pursuant to S.C. Code Ann. § 12-60-2540 (Supp. 1996). Pursuant to ALJD Rule 19(D), the cases bearing Docket Numbers 97-ALJ-17-0158-CC and 97-ALJ-17-0159-CC have been consolidated for hearing purposes. A hearing of both matters was conducted on July 23, 1997 at the Jasper County Courthouse, Ridgeland, South Carolina. Upon consideration of all the testimony and evidence in the record, I conclude that for the tax year 1996, the fair market value of Michael Gannam's property is $33,100 and the fair market value of Marion Gannam's property for tax purposes is $40,500.

At issue is the fair market value of two separate but adjacent parcels of real property located in Jasper County for tax year 1996. Michael and Marion Gannam are husband and wife. One parcel of real property is owned by Michael Gannam and the other is owned by Marion Gannam. Both parcels are used for timber growth and are taxed under the agricultural use classification. Taxpayer Marion Gannam's property contains 32.34 acres and is identified as TMS #038-00-06-059. Taxpayer Michael Gannam's property contains 14.5 acres and is identified as TMS #038-00-06-060.

During the mass appraisal process of the 1996 county-wide reassessment in Jasper County, the parcels were valued by the Assessor's office in relation to recent sales of other properties in the County of similar size, use, and location. The value of the raw land was added to the estimated value of the timber thereon to achieve the total fair market value of each tract.

For 1996, the Assessor valued Mrs. Gannam's lot at $40,500, and $33,100 for Mr. Gannam's lot. Prior to reassessment, the lots were valued by the Assessor at $23,000 and $10,200, respectively.

The Gannams filed applications for review of the new valuations, and an appointment with an appraiser in the Assessor's office was scheduled. As a result of the requests for review, Alda Jones, an appraiser in the Assessor's office, performed individual appraisals of the Gannam tracts. Ms. Jones valued Mrs. Gannam's parcel at $80,800 and Mr. Gannam's parcel at $43,500. The Gannams estimated the value of the two lots to be $16,000 and $7,000, respectively. Subsequently, a conference before the Jasper County Board of Assessment Appeals was scheduled. The County Board chose the Assessor's initial mass appraisal values for the subject parcels. The Gannams then filed a request for a contested case hearing before the ALJD, and these actions followed.

At the contested case hearing, the Assessor explained the mass appraisal process of valuation used during reassessment and presented evidence to support the new valuations for the subject parcels. The Gannams contest the value derived by the Assessor and Board, arguing that the fair market value of each parcel is much lower than the reassessment notices reflect.

Mr. Gannam testified as to the condition of the subject parcels, including the existence of wetlands on the property, and complained that the comparable sales used by the county in its valuations were not of similar location and/or character as the subject lots. The Gannams did not, however, offer their own appraisals or comparable sales in support of lower values. In fact, they failed to offer any evidence of the fair market value of the lots. In the absence of any evidence to the contrary, the assessing authority's values are the only values available to assign to the properties and must be presumed to be correct.

I find, by a preponderance of the evidence, the following facts:

1. Taxpayer Michael Gannam is the owner of real property consisting of 14.5 acres off Shad Road, Levy Section in Hardeeville, South Carolina, identified on the Jasper County Tax Map as TMS #038-00-06-060.
2. Taxpayer Marion Gannam is the owner of real property consisting of 32.34 acres off Shad Road, Levy Section in Hardeeville, South Carolina, shown on the Jasper County Tax Map as TMS #038-00-06-059.
3. The Gannams are husband and wife, and the subject parcels are separate but adjacent tracts.
4. Jasper County undertook county-wide real estate property tax reassessment in 1996.
5. On or about June 6, 1996, the Assessor notified Michael Gannam of the reassessment of his property for tax year 1996 at $33,100.
6. On or about June 6, 1996, the Assessor notified Marion Gannam of the reassessed value of her property for tax year 1996 at $40,500.
7. On September 24, 1996, Michael and Marion Gannam filed with the Assessor two separate Applications for Review of Appraisal/Assessment.
8. In their respective applications for review, Michael Gannam asserts his property is valued at $7,000, while Marion Gannam asserts the proper value of her property is $16,000 for tax year 1996.
9. Upon review, the Assessor conducted a physical inspection of Michael Gannam's property on February 11, 1997. Using the market sales comparison approach, the Assessor concluded a fair market value of $43,500.
10. Upon review, the Assessor conducted a physical inspection of Marion Gannam's property on February 11, 1997. Using the market sales comparison approach, the Assessor concluded a fair market value of $80,800.
11. Michael and Marion Gannam appealed to the Jasper County Board of Assessment Appeals, which conducted a conference on March 6, 1997 and found the fair market value of Michael Gannam's property to be $33,100 and Marion Gannam's property to be $40,500.
12. Both parcels are classified for agricultural use by virtue of being used for timber growth.
13. Because the parcels are classified for agricultural use, the fair market value of the parcels does not affect the amount of taxes due on the properties.
14. The agricultural use classification of the subject parcels is not at issue.
15. By letter dated April 3, 1997, Michael and Marion Gannam, by and through their attorney, appealed the property tax assessments made by the Board and requested a contested case hearing before the Administrative Law Judge Division.
16. Notice of the time, date, place, and subject matter of the hearing was given to all parties, and the contested case hearing was conducted July 23, 1997, at the Jasper County Courthouse in Ridgeland.
17. Upon motion and consent, the two cases were consolidated for hearing.
18. Although the Assessor presented individual appraisals of each subject parcel supporting much higher valuations, the Assessor supports the valuations which resulted from the mass appraisal process during county-wide reassessment.
19. Adequate evidence was presented to explain and support the validity of the systematic mass appraisal method used by the county and the resulting valuations.
20. The Gannams presented no evidence as to the fair market value of either of the subject parcels. Petitioners assert only that the values set by the Board are too high. They did not offer their own appraisal or comparable sales in support of lower values.
21. There is no evidence that other properties in Jasper County have been intentionally and systematically undervalued.

1. In the absence of any probative evidence to the contrary, the fair market value of TMS #038-00-06-059 for tax year 1996 is $40,500.
2. In the absence of any probative evidence to the contrary, the fair market value of TMS #038-00-06-060 for tax year 1996 is $33,100.

CONCLUSIONS OF LAW

Based upon the foregoing Discussion and Findings of Fact, I conclude as a matter of law the following:

1. The Administrative Law Judge Division has subject matter jurisdiction in this matter pursuant to Chapter 23 of Title I of the 1976 Code, as amended.
2. S.C. Code Ann. § 12-60-2540 (Supp. 1996) authorizes the South Carolina Administrative Law Judge Division to hear contested cases in property tax assessment matters pursuant to Chapter 23 of Title I, as amended.
3. Real property in the State of South Carolina is subject to taxation. S.C. Code Ann.

§ 12-37-210 (1996).

1. The proper measure of value for taxation purposes is the fair market value. Lindsey v. S.C. Tax Commission, 302 S.C. 504, 397 S.E.2d 95 (1990), 84 C.J.S. Taxation § 411 at 791 (1954).
2. Fair market value is defined in S.C. Code § 12-37-930 as:

. . . the price which the property would bring following reasonable exposure to the market, where both the seller and the buyer are willing, are not under compulsion, and are reasonably well informed of the uses and purposes for which it is adapted and for which it is capable of being used.

S.C. Code Ann. § 12-37-930 (Supp. 1996).

1. "Absolute accuracy with respect to valuation and complete equality and uniformity are not practically attainable." Wasson v. Mayes, 252 S.C. 497, 502, 167 S.E.2d 304, 306-307 (1969).
2. As the parties contesting the assessing authority's valuation, the Gannams had the burden of proving the actual value of the properties. Reliance Insurance Co. v. Smith, Op. No. 2694 (S.C. Ct. App. filed June 30, 1997); Cloyd v. Mabry, 295 S.C. 86, 367 S.E.2d 171, at 173 (Ct. App. 1988).
3. Because the Gannams failed to present any contrary evidence as to the proper value of the subject properties, the assessing authority's value is presumed correct. See Reliance Insurance Co. v. Smith, Op. No. 2694 (S.C. Ct. App. filed June 30, 1997).
4. Any motions or issues raised in the proceedings or hearing of this case, but not addressed in this Order, are deemed denied. ALJD Rule 20(B).

ORDER

IT IS THEREFORE ORDERED that the value for taxation purposes of Marion Gannam's property, Jasper County TMS #038-00-06-059, for tax year 1996 is $40,500, and the value of Michael Gannam's property, Jasper County TMS # 038-00-06-060, for tax year 1996 is $33,100.

_____________________________________

STEPHEN P. BATES

ADMINISTRATIVE LAW JUDGE

August 14, 1997

Columbia, South Carolina

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