SC Administrative Law Court Decisions

This matter is a contested case brought by John A. Cloyd, Richland County Assessor (Assessor), against the Respondent, concerning a property valuation for the 1995 tax year. The Richland County Board of Assessment Appeals found that the valuation of the Respondent's property should be reviewed by the Assessor as requested by the Respondent. A hearing was held at the office of the Administrative Law Judge Division ("ALJD") on August 28, 1997.

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 evidence:

1. Notice of the date, time, place, and nature of the hearing was timely given to all parties.

2. The Respondent and Peter Korn purchased a commercial property located at 1518 Pickens Street, in Columbia, S.C. on November 23, 1994. The Respondent and Mr. Korn divided the property as evenly as possible and the Respondent paid $199,000 for her portion and Mr. Korn paid $225,000 for his portion of the property. The property was re-platted to reflect the division between Ms. Walker and Mr. Korn. After the subdivision of the property, the Assessor chose to create a new tax map parcel number R11402-05-18 for Mr. Korn's portion of the property. The Assessor determined that Ms. Walker's property was the parent tract, and therefore her property retained the old tax map number R11402-05-14. Since the Assessor treated Ms. Walker's property as the parent tract, the Assessor simply sent a tax bill based on a valuation of $318,900 and did not send her a Notice of Assessment.⁽¹⁾ Ms. Walker appealed the valuation of her property within 30 days after she received her tax notice.

3. The Assessor argued that the Respondent's property was appraised at a higher value because she received 2,500 square feet more than Mr. Korn. However, the Assessor did not produce any evidence to support that contention. On the other hand, Ms. Walker testified that the property was equally split with no discernable difference in the square footage between the properties. I find that the Walker and Korn tracts were equally divided.

4. The Assessor contends that the Respondent was required to protest her tax bill pursuant to S.C. Code Ann. §12-60-2510 (4) (Supp. 1996). Therefore, since the Respondent failed to file a written Notice by March 1, 1996, the Respondent's appeal should be dismissed. The Respondent contends that because her lot was subdivided it constitutes a new lot and therefore a Notice of Assessment should have been sent. She further contends that the selection of Mr. Korn's property as the new tax map parcel, rather than her property, is arbitrary.

5. The Assessor valued the Respondent's property at $195,800 for 1996.

Based on the foregoing Findings of Fact, I conclude the following as a matter of law:

1. The Administrative Law Judge Division has jurisdiction of this matter pursuant to S.C. Code Ann. § 12-60-2540(A) (Supp. 1996).

2. This matter is a contested case pursuant to S.C. Code Ann. §§ 12-60-2540 and 1-23-310 et seq. (Supp. 1996). As such, an Administrative Law Judge hears and decides this matter de novo.

3. "[A] taxing statute must be construed most favorably to the taxpayer, and that any doubt should be resolved against the taxing authority." Ryder Truck Lines, Inc. v. S.C. Tax Comm'n, 248 S.C. 148, 149 S.E.2d 435, 437 (1966).

4. The Assessor's decision as to the valuation of property is generally presumed correct until the person complaining meets the burden of proving the case to the contrary. Ordinarily, this is done by proving the actual value of the property. Cloyd v. Mabry, 295 S.C. 86, 367 S.E.2d 171 (Ct. App. 1988); 84 C.J.S. Taxation §537 (1954).

5. The taxpayer may, however, show by other evidence that the assessing authority's valuation is incorrect. If the taxpayer does so, the presumption of correctness is removed and the taxpayer is entitled to appropriate relief. Cloyd, supra.

6. S.C. Code Ann. §12-37-930 (Supp. 1996) provides that real property is valued as follows:

All real property must be valued for taxation at its true value in money which in all cases is the price which the property would bring following reasonable exposure to the market, where both the seller and buyer are willing, are not acting under compulsion, and are reasonably well informed as to the uses and purposes for which it is adapted and for which it is capable for being used.

7. Fair market value is the measure of true value for taxation purposes. Lindsey v. S.C. Tax Comm'n, 302 S.C. 274, 395 S.E.2d 184 (1990). There is no valid distinction between market value for sales purposes and market value for taxation purposes under S.C. Code Ann. §12-37-930. S.C. Tax Comm'n v. S.C. Tax Board of Review, 287 S.C. 415, 339 S.E.2d 131 (Ct. App. 1985).

8. The taxable status of real property for a given year is to be determined as of December 31st of the preceding tax year. S.C. Code Ann. § 12-37-900 (1976). Atkinson Dredging Co. v. Thomas, 266 S.C. 361, 232 S.E.2d 592 (1976).

9. S.C. Code Ann. § 12-60-2110 (Supp. 1996) provides that:

In the case of property tax assessments made by a division of the department, protests must be filed within thirty days after the date of the property tax assessment notice. If the division does not send a taxpayer a property tax assessment notice, a protest must be filed within thirty days after the tax notice is mailed to the taxpayer. If a division of the department denies a property tax exemption, a protest must be filed within thirty days after the date the notice of denial is mailed to the taxpayer.

In this case, the Assessor did not send a Notice of Assessment to the Respondent. Therefore, the Respondent was required to appeal the valuation of her property within 30 days after she received her tax notice, and her appeal was timely.

10. An administrative decision is "arbitrary" if it is without rational basis, is based alone on one's will and not upon any course of reasoning and exercise of judgment, is made at pleasure, without adequate determining principles, or is governed by no fixed rules or standards. Deese v. S.C. State Bd. of Dentistry, 286 S.C. 182, 332 S.E.2d 539 (Ct. App. 1985). I find that the Department's determination that the Petitioner's property is the parent tract, though her property was equally divided with that of Mr. Korn, is an arbitrary action.

Based upon the Findings of Fact and Conclusions of Law, It is hereby:

ORDERED AND ADJUDGED that the Assessor value taxpayer's property identified as R11402-05-14 at $195,800 for the tax year 1995.

AND IT IS SO ORDERED.

__________________________________

Ralph King Anderson, III

Administrative Law Judge

Columbia, South Carolina

November 6, 1997

1. Mr. Korn was sent a Notice of Assessment of $225,000 for his portion of the property.