Citation Numbers： 101 Misc. 2d 910
Judges： Koreman
Filed Date： 11/23/1979
Status： Precedential
Modified Date： 2/5/2022
OPINION OF THE COURT
In proceedings to review assessments of petitioner’s special franchise properties, intervenor-respondent City of White Plains moves for an order granting summary judgment dismissing the petitions or in the alternative granting partial summary judgment precluding the petitioner from offering any affirmative proof with respect to value of these properties. The respondent State Board of Equalization and Assessment (State Board) similarly moves for -summary judgment, and other intervenors-respondents referred to as the "Westchester Municipalities”, move jointly for partial summary judgment on the issue of overvaluation of the special franchise properties. Several other intervenors-respondents have joined in the motion brought by the City of White Plains.
The petitioner cross-moves for an order denying said motions, or, in the alternative, for leave to file new appraisals based upon those theories of valuation which the court may hold are permissible herein as a matter of law.
Petitioner has filed appraisal reports to support its claim of overvaluation as required by the rules of the Third Judicial Department (22 NYCRR 839.3 [a]); appraisal reports have also been submitted by the respondent State Board and by intervenor-respondent City of New York, and these appraisals have been exchanged (22 NYCRR 839.3 [b]). Under the departmental rules, on the trial of the proceedings, the parties are "limited in their affirmative proof of value to matters set forth in their respective appraisal reports.” (22 NYCRR 839.3 [d].)
For each of the years in dispute in these proceedings pe
Initially, the court finds no merit to petitioner’s argument that the instant motions are barred by a prior order of the Supreme Court, dated October 28, 1976, made in these same proceedings wherein it was stated "that the proper approach to valuing the special franchise property is a question for the trial.” There was no question before the court on that motion as to whether petitioner’s appraisals could be used to prove overvaluation, and, in any event, the order cannot reasonably be construed as barring any further motions addressed to the legal sufficiency or appropriateness of petitioner’s theories of valuation.
For purposes of assessment and taxation petitioner’s special franchise property consists not only of its intangible property or right to the use of the public streets and highways in the conduct of its business, but also includes "the value of the tangible property situated in, under, above, upon or through any public street, highway, water or other public place” which it uses to carry on its business as a public utility. (Real Property Tax Law, § 102, subd 17.) The appraisals filed and exchanged by petitioner and the State Board purport to value the special franchises by including both the tangible and intangible property in accordance with the above-cited statute. However, petitioner’s apparaisals arrive at a unit value of the special franchise property by using capitalization of income and original cost approaches, while the State Board’s appraisals are based on valuations of the tangible property separately
An extensive discussion of the relative merits of the various approaches to real property valuations is unnecessary to the disposition of these motions. It is clear that the burden of overcoming the presumption of the validity of the assessments as fixed by the State Board rests with the petitioner (People ex rel. Jamaica Water Supply Co. v State Bd. of Tax Comrs., 196 NY 39, 53; Matter of Metropolitan Life Ins. Co. v Tax Comm. of City of N. Y., 22 AD2d 870, affd 16 NY2d 935; Matter of Peterson v Board of Assessors of Town of Westport, 25 AD2d 797). The underlying issue to be determined here is whether in the light of the theories of valuation relied on by petitioner in the appraisals as filed, and based upon the exhibits and affidavits submitted to the court, it must be concluded as a matter of law that petitioner cannot meet its burden of proving on the trial of these proceedings that the special franchise assessments in question are in error by reason of overvaluation.
Under the provisions of subdivision 1 of section 606 of the Real Property Tax Law, in arriving at a special franchise assessment the State Board must first determine the full value of the special franchise property and then apply the latest State equalization rate to it to compute the amount of the assessment. As to any portion of special franchise property that was on the assessment rolls for the year 1953, the State equalization rate for the year 1953 must be applied. The Legislature has not mandated nor prescribed any exclusive method for the valuation of special franchises. However, where property is designed for "unique” purposes or is "uniquely adapted” to the business conducted upon it or use made of it, for which there is no market, and which cannot be converted to other uses without the expenditure of substantial sums of money, such property has been classified as a "specialty” and regarded as such in determining its sound value. Applying these criteria to petitioner’s special franchises impels the conclusion that we are dealing here with the valuation of "specialty” property (Matter of County of Suffolk [C. J. Van Bourgondien, Inc.], 47 NY2d 507; Matter of Great Atlantic & Pacific Tea Co. v Kiernan, 42 NY2d 236). It has consistently been held that the proper and accepted method for the
"To obtain summary judgment it is necessary that the movant establish his cause of action or defense 'sufficiently to warrant the court as a matter of law in directing judgment’ in his favor (CPLR 3212, subd [b]), and he must do so by tender of evidentiary proof in admissible form. On the other hand, to defeat a motion for summary judgment the opposing party must 'show facts sufficient to require a trial of any issue of fact’ (CPLR 3212, subd [b]). Normally if the opponent is to succeed in defeating a summary judgment motion he, too, must make his showing by producing evidentiary proof in admissible form. The rule with respect to defeating a motion for summary judgment, however, is more flexible, for the
In applying the general principles set forth above to the proof presented in opposition to these motions, the court is not persuaded that petitioner does not "show facts sufficient to require a trial of any issue of fact (CPLR 3212, subd [b])”. Rather, the factual statements contained in the opposing affidavits indicate that by filing additional data concerning reproduction cost new less depreciation, petitioner may be able to substantiate its contention of overvaluation at the. trial of these proceedings. The affidavits and exhibits submitted to the court disclose that petitioner filed its appraisals based upon its interpretation of the legal precedents permitting the use of income and original cost data; that the State Board has already filed appraisal reports relying upon the reproduction cost new less depreciation method; and that petitioner has indicated throughout these proceedings that it disagrees both with the use of reproduction cost new less depreciation approach to valuation and with the manner in which the State Board has calculated such cost and depreciation. Furthermore, petitioner proposes to show that even under the reproduction cost new less depreciation method the State Board’s appraisals overstate the value of the special franchise property. It also appears that the intervenor-respondent City of New York, the
It should also be noted that this court has already granted partial summary judgment with respect to one aspect of these proceedings (98 Misc 2d 491). By order dated March 23, 1979, from which an appeal to the Appellate Division, Third Department, is now pending, this court dismissed the portions of the petitions filed herein which sought to annul the assessments on the basis of inequality by challenging the equalization rate arrived at and applied by the State Board for the various taxing jurisdictions in arriving at the assessments of the special franchises located therein. In my opinion, the interests of justice would not be served by granting the instant motions and thereby effectively foreclosing the petitioner from litigating issues of great complexity and of far-reaching consequence and importance. Since petitioner has made a sufficient showing that a genuine factual issue exists as to whether the assessments under review are in error by reason of overvaluation, that issue requires a plenary trial affording petitioner an opportunity to fully develop all relevant factors bearing on the question of value of its special franchises for purposes of assessment. "Admittedly, a trial would seem unnecessary if it were certain, in an absolute rather than a pragmatic sense of the term * * * that all the proof would be excludable. This is not a case, however, where all the evidence might be excluded, nor does such a case occur often, if ever.” (Phillips v Kantor & Co., 31 NY2d 307, 314, supra.)
Under all of the facts and circumstances alluded to herein, petitioner is entitled to a trial on the issue of overvaluation.
Accordingly, the motions for summary judgment are denied. While the cross motion seeks leave to file supplemental appraisals as alternative relief in the event summary judgment were granted, nevertheless, in these circumstances good cause has been shown to allow petitioner to file such appraisals (22 NYCRR 839.3 [e]) and the parties will not be prejudiced thereby. Petitioner, therefore, is permitted to file supplemen