Term 
NOTICE: Decisions issued by the Appeals Court pursuant to its rule 1:28 are primarily addressed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, rule 1:28 decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28, issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent.
COMMONWEALTH OF MASSACHUSETTS APPEALS COURT
The plaintiff property owners (collectively, Graham), appeal from decisions of the Appellate Tax Board (board) involving real estate tax assessments on seven properties located in West Tisbury, on the north shore of Martha's Vineyard. The board ruled that the defendant assessors overvalued two of the properties for fiscal years 2003 and 2004, and ruled for the assessors on the remaining Graham properties. For factual background, we refer to the board's June 7, 2007, 'Findings of Fact and Report.'
Graham claims that the assessors' method for determining assessed values, utilized in the 2002 revaluation process, was so compromised by errors that it resulted in the overvaluation of Graham's properties. Graham argues, in particular, that the assessors lacked support for establishing neighborhood 200, that the assessors deliberately used an erroneous condition factor on the Roberts property in creating neighborhood 200, and that the Graham properties did not belong in neighborhood 200. He also challenges the assessors' treatment of wetlands in valuing his properties. Finally, he argues that the board improperly rejected his evidence of comparative assessments and his evidence of disproportionate assessment.
We review whether the board's decisions were supported by substantial evidence. New Boston Garden Corp. v. Assessors of Boston, 383 Mass. 456, 465 (1981). Assessors of Newton v. Iodice, 29 Mass. App. Ct. 1014, 1015 (1991). 'Substantial evidence is 'such evidence as a reasonable mind might accept as adequate to support a conclusion." New Boston Garden Corp. v. Assessors of Boston, supra at 466, quoting from Boston Edison Co. v. Selectmen of Concord, 355 Mass. 79, 92 (1968). 'Our review of sufficiency of the evidence is limited to 'whether a contrary conclusion is not merely a possible but a necessary inference from the findings." Olympia & York State St. Co. v. Assessors of Boston, 428 Mass. 236, 240 (1998), quoting from Kennametal, Inc. v. Commissioner of Rev., 426 Mass. 39, 43 (1997), cert. denied 523 U.S. 1059 (1998). 'A finding of the board must be set aside if 'the evidence points to no felt or appreciable probability of the conclusion or points to an overwhelming probability of the contrary." New Boston Garden Corp. v. Assessors of Boston, supra, quoting from Jaffe, Judicial Control of Administrative Action 598 (1965).
Graham bore the burden of proof on the issue of valuation. Foxboro Assocs. v. Assessors of Foxborough, 385 Mass. 679, 684 (1982). Western Mass. Lifecare Corp. v. Assessors of Springfield, 434 Mass. 96, 106 (2001). That burden could be met by presenting 'persuasive evidence of overvaluation either by exposing flaws or errors in the assessors' method of valuation, or by introducing affirmative evidence of value which undermines the assessors' valuation.' Donlon v. Assessors of Holliston, 389 Mass. 848, 855 (1983). General Elec. Co. v. Assessors of Lynn, 393 Mass. 591, 600 (1984). See Hampton Assocs. v. Assessors of Northampton, 52 Mass. App. Ct. 110, 116 n.13 (2001). Graham sought to prove that the assessors had overvalued his properties by challenging their methodology on several grounds. Graham also introduced evidence of what he claimed to be comparable assessments, though the board rejected Graham's analysis as affirmative evidence of value.
The board credited the assessors' explanations regarding the mass appraisal system it employed and the application of that system to the Graham properties and surrounding properties and neighborhoods. But the board particularly credited the testimony of the assessors' expert real estate appraiser, Kenneth Croft, who provided extensive evidence directly relating to the fair cash value of the Graham properties through comparable sales data, which further indicated that those properties had not been overvalued by the assessors.
On appeal, much of Graham's argument consists of pressing portions of the record favorable to his cause, but he fails to demonstrate that substantial evidence was lacking to support the board's conclusions in favor of the assessors. On our view of the record, we are satisfied that the board's findings were based on substantial evidence and that its reasons for rejecting much of Graham's proof were well-founded. [FN2]
We turn to Graham's specific contentions on appeal.
1. Valuation neighborhood 200. The board found that the assessors' creation of a new valuation neighborhood, referred to as neighborhood 200, was warranted in response to the 1999 sales of the Ziff and Roberts properties, both at prices exceeding ten million dollars. The testimony of June Perry, a senior appraiser for Vision Appraisal Technology, who assisted the assessors with the 2002 revaluation, set out in significant detail the method by which the assessors utilized the sales information from the Ziff and Roberts properties to develop an appropriate neighborhood factor that reflected the dramatic increase in property values. Perry explained that the process began with performing a residual analysis [FN3] on the Ziff property, and then, armed with the new neighborhood factor derived from that analysis, performing the residual analysis on the Roberts property. She further explained that creation of neighborhood 200, in light of those sales, was necessary for the methodology to function properly, as without the new neighborhood factor, the assessed values for the 2002 revaluation would not be consistent with the prices that were actually paid. Stephen Ferreira, Vision's district manager who was also qualified as an expert at the hearing, testified that in the revaluation process, new sales were evidence of value, and it was incumbent upon the assessors to make changes in their methodology to reflect that evidence, and then apply it in a consistent way to nonsales properties. He also pointed out that the Department of Revenue would not certify an appraisal if the assessments were not consistent with recent sales. The evidence also showed that a 1999 sale on the south shore of Martha's Vineyard, and three additional sales that took place in neighborhood 200 in 2002 and 2003, all exceeded ten million dollars, and confirmed the assessors' recognition that a new valuation neighborhood had emerged.
Additionally, as previously noted, the board credited the extensive testimony of the assessors' expert, Kenneth Croft, as providing confirmation, through comparable sales data, that the methodology employed in the 2002 revaluation produced assessments that were consistent with the fair cash value of the subject properties. The board acted within its discretion in relying on Croft's evidence of comparable sales, which it characterized as 'particularly instructive and compelling,' to confirm the assessors' valuations. See generally Assessors of Boston v. Ogden Suffolk Downs, Inc., 398 Mass. 604, 608 (1986). The board thus concluded that Graham failed to carry his burden of showing that the assessors' methodology resulted in the overvaluation of the Graham properties.
Graham directs our attention to irregularities in the assessors' treatment of the Roberts property as evidence of a flawed methodology in the creation of neighborhood 200. Graham insists that the assessors falsified the property record card and manipulated their calculations in order to reconcile the Roberts property value with the desired neighborhood factor for neighborhood 200. The board was entitled to credit the assessors' explanation regarding adjustments made in the property record card for the Roberts property. Moreover, the board's finding that the condition factor for the Roberts property was mathematically derived, and not influenced by the inaccurate 'no view' notation for excess acreage on the property card, was fully supported in the record, both by Perry's testimony, and by Ferreira's expert testimony. [FN4] See generally Cummington Sch. of the Arts, Inc. v. Assessors of Cummington, 373 Mass. 597, 605 (1977) ('The credibility of witnesses, the weight of the evidence, and the inferences to be drawn from the evidence are matters for the board'). The record did not necessitate the inference that the assessors improperly manipulated the condition factor by means of the 'no view' notation in order to fit the Roberts property into neighborhood 200. See, e.g., Kennametal, Inc. v. Commissioner of Rev., 26 Mass. at 46 (conclusion sought by taxpayer was not necessarily inferred from the facts).
The board expressly rejected the proposed alternative to the assessors' method of valuation offered by Graham's expert, Jay Closser. The board declined to rely on significant portions of Closser's testimony, citing his lack of expertise in valuing waterfront properties, lack of independent research, and lack of reliable analysis to opine meaningfully on the properties at issue. It was for the board to decide the weight to be given to the opinion evidence; its stated reasons for rejecting portions of Closser's testimony supplied an adequate basis for doing so. See Donlon v. Assessors of Holliston, 389 Mass. at 856. 'As may any trier of fact, the board could accept or reject and pick and choose from the evidence the parties present to it,' so long as it articulated its rationale for any rejection. Turners Falls Ltd. Partnership, v. Assessors of Montague, 54 Mass. App. Ct. 732, 736 (2002). [FN5]
Graham next argues that the board erred in finding that the assessors' inclusion of the Graham properties in neighborhood 200 was appropriate. According to Graham, the sole reason offered by the assessors for including his properties in neighborhood 200 was because they had been grouped with the Ziff and Roberts properties for fifteen years. He points out that other properties formerly grouped together with properties now part of neighborhood 200 were placed in different neighborhoods in the 2002 revaluation.
But the evidence showed that the determination of boundaries for neighborhood 200 depended on several variables and was, to a certain extent, a subjective judgment to be made by the assessors. In this regard, the record revealed that, in addition to the proximity of recent sales and the historical placement of the neighborhoods, the assessors also considered the size of the lots, the density of development, the type of housing, the type of access to the properties, and the physical characteristics of the land, in determining whether certain properties belonged to neighborhood 200. Additional testimony addressed specific characteristics of the neighborhood 200 properties, and the Graham properties in particular, in comparison to the smaller, less private lots, some further from the water, some in subdivision settings, that had previously been grouped with the former in a single neighborhood. Again, Graham did not meet his burden of showing that the evidence necessitated a finding that the assessors' methodology and judgment in creating neighborhood 200 caused the Graham properties to be overvalued.
'The taxpayer bears the burden of showing the property is overvalued, and the board may presume the validity of the valuation unless the taxpayer has sustained the burden of proving the contrary.' Western Mass. Lifecare Corp. v. Assessors of Springfield, 434 Mass. at 106. The board noted that, while there may have been errors in the 2002 revaluation, proof was lacking that any such errors resulted in overvaluation of the Graham properties, particularly where the assessors presented evidence of the properties' fair cash value that confirmed the accuracy of the assessors' valuation. The board acted within its discretion in relying on the extensive evidence from the assessors' expert, deemed credible and compelling by the board, regarding the fair cash value of each of the Graham properties based on comparable sales. Graham having failed to sustain his burden of proof on the issue of overvaluation, the board properly concluded that the assessors' method of valuation was valid. Donlon v. Assessors of Holliston, 389 Mass. at 861.
2. Treatment of wetlands. Graham next argues that the assessors treated the wetlands on the Graham properties inconsistently, resulting in overvaluation. The board found that the manner in which the assessor valued the wetlands in the revaluation process, whereby some were valued at $500 per acre, while others were valued by adjusting a property's condition factor, was acceptable under the circumstances of a mass appraisal. The record shows that when Graham provided the assessors with plans showing the wetlands on four of his properties, the assessors granted abatements for three of the four parcels, by treating the wetlands as excess acreage and reducing the condition factor for the excess land accordingly. Graham now argues that, once the wetlands on four of his properties were identified, the $500 per acre method should have been used to reduce his assessment. Yet Graham, while arguing that the assessors' treatment of wetlands rendered the valuation unreliable, failed to meet his burden of showing that the alleged errors in methodology resulted in overvaluation of the Graham properties.
Again, the record confirms that Croft, the assessors' expert whom the board credited, adjusted his estimated values of the Graham properties to take into account the wetlands delineated on the updated plans to arrive at their respective fair cash value. Where Croft's adjusted figures differed from those of the assessors, the board ordered abatements based on Croft's testimony. We are satisfied that, with the abatements ordered by the board, the board's conclusion, that the Graham properties had not been overvalued because of the treatment of the wetlands, was supported by substantial evidence.
3. Graham's evidence of comparable assessments. The board found that Graham presented little by way of credible evidence to prove the fair cash value of his properties. Rather, he testified to what he considered to be the correct assessment for his properties by applying a significantly lower neighborhood factor to the assessors' mass appraisal methodology, and then compared his proposed assessments to the assessments of 'purportedly comparable' properties, as the board characterized them. The board rejected Graham's approach on several grounds, not the least of which was Graham's lack of expertise to testify to mass appraisal methodology. The board observed that while Graham might have testified to his opinion, as the property owner, of the fair market values of his properties, he failed to do so.
On appeal, Graham fails to cite authority to support his position that the board was required to accept his proposed changes in the assessors' methodology as proof of overvaluation. On the contrary, the board was not 'bound to adopt any particular method of valuation' that the appellant's witnesses put forth. Assessors of Newton v. Iodice, 29 Mass. App. Ct. at 1016 (board's decision to discard a particular approach to valuation as too speculative was 'within its purview'). Furthermore, it was for the board, as the fact finder, to determine the weight and credibility of Graham's testimony concerning comparable properties, and whether differences between the comparable properties and the Graham properties required adjustments. [FN6] The board 'was free to accept or reject any of the conflicting evidence presented to it.' Ibid. The board was justified in concluding that Graham's attempts to alter the mass appraisal methodology to his liking did not produce credible evidence of property values.
4. Disproportionate assessment claim. Graham maintains that the evidence he presented indicating that the assessors overvalued the Graham properties supported an inference, as well, that they engaged in an intentional scheme of disproportionate assessment. Substantially for the reasons stated by the board in
its findings of fact, we agree that Graham failed to meet his burden of proving disproportionate assessment.
Decisions of the Appellate Tax Board affirmed.
By the Court (Grasso, Trainor & Wolohojian, JJ.),
| FN1. The companion cases were brought by various individuals and entities in relation to seven properties located in West Tisbury. |
| FN2. Graham suggests, without relevant authority, that we give little or no deference to the board's findings because the board member who presided over the hearing did not participate in issuing the findings of fact and report. The report stated at the outset that the board chairman who heard the appeals was joined in the decisions by the board, and her participation in that regard sufficed. See Stilson v. Assessors of Gloucester, 385 Mass. 724, 731 (1982); Rabinovitz v. Commissioner of Rev., 396 Mass. 133, 136 (1985). Compare Bayer Corp. v. Commissioner of Rev., 436 Mass. 302, 308 n.8 (2002). |
| FN3. Perry described a residual analysis as subtracting the building values from the sales price of the property, to reach the residual land price for the property. The assessors then used the value they had assigned per acre for the primary site, multiplied by the property's condition factor, added to the value per acre of the excess acres multiplied by the excess acres' condition factor, which was divided by the residual land price; the result for the Ziff property was 10.06. By means of that calculation, which we have dramatically oversimplified here, the assessors determined an approximation for what the neighborhood factor would be; in the case of neighborhood 200, they settled on a neighborhood factor of 9.50. When this analysis was performed on the Ziff and Roberts properties, the assessors determined that a new neighborhood 200 was appropriate, based on the new neighborhood factor derived from the property characteristics and the ten million dollars plus sales price. |
| FN4. The board could have found from Perry's testimony that the 'no view' notation did not determine the condition factor for the Roberts property, that the condition factor for a sales property was determined from the price actually paid. Perry testified that because the Roberts property was waterfront, a water view was presumed, and that the condition factor would have been the same regardless of whether the 'no view' notation for the excess acreage was written on the property card. Ferreira, who was qualified as an expert during the hearing, testified at length about the manner in which the condition factor was derived from the sales data, and stated his opinion that the inaccurate 'no view' notation on the Roberts property card did not affect the calculation that determined the condition factor for the excess |
| acreage, nor would the correct notation on the Roberts property card have changed the condition factor used by the assessors. |
| FN5. Graham cites to no authority to support his contention that because the presiding officer qualified Closser as an expert at the hearing, the board could not thereafter reject the substance of his testimony, or portions thereof, for the reasons stated. The board did rely on other portions of Closser's testimony. |
| FN6. Graham conceded that he made no adjustments for the differences in any of the comparable properties, but on appeal attempts to convince us of their similarities to the Graham properties. As the assessors demonstrate in their brief in response, it was a question of fact for the board whether Graham's evidence of comparable properties, without adjustments made for the differences between those properties and the Graham properties, satisfied his burden of proof. Contrast New Boston Garden Corp. v. Assessors of Boston, 383 Mass. at 470-471 (unrebutted evidence of comparable properties, with adjustments made for their differences, was not properly rejected by the board without stating its reasons). |
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