Fraughton v. Utah State Tax Comm'n

2019 UT App 6THE UTAH COURT OF APPEALS
EDWARD J. FRAUGHTON,
Petitioner,
v.
UTAH STATE TAX COMMISSION AND BOARD OF
EQUALIZATION OF SALT LAKE COUNTY,
Respondents.
Opinion
No. 20170430-CA
Filed January 10, 2019
Original Proceeding in this Court
Edwin S. Wall, Attorney for Petitioner
Bradley C. Johnson, Attorney for Respondent Board
of Equalization of Salt Lake County
JUDGE DAVID N. MORTENSEN authored this Opinion, in which
JUDGES KATE APPLEBY and RYAN M. HARRIS concurred.
MORTENSEN, Judge:
¶1 In 2015, Edward J. Fraughton challenged the assessed
value on his residence, claiming that promises made in 1973 by
unidentified persons from South Jordan City (the City) were key
to determining the correct value. Fraughton’s challenge was, in
large part, successful, resulting in just a three percent difference
in the assessed value from Fraughton’s claimed value. But
Fraughton refused to stipulate to the new assessed value and
appealed to the Utah State Tax Commission (the Commission).
Fraughton now seeks review of the Commission’s final decision
that Fraughton had neither shown an error in the assessment nor
provided a sound evidentiary basis for a lower residential
property value. We are unpersuaded by Fraughton’s arguments
and decline to disturb the decision of the Commission.
Fraughton v. Tax Commission
BACKGROUND
¶2 Edward Fraughton purchased an abandoned brick church
in the City in 1973. Fraughton, an artist, planned to preserve the
historic building and the 2.41 acres of land on which it sat (the
Property) for use as his workshop and as a residence for his
family.
¶3 For the 2015 tax year, the Property was assessed at
$1,163,780. In September 2015, Fraughton appealed that
assessment to the Salt Lake County Board of Equalization (the
Board), arguing that the fair market value of the Property was
$704,480. In a March 2016 hearing, the Board reduced the
assessed value to $947,000 based on evidence submitted by the
Salt Lake County Assessor. The Board noted that Fraughton had
not “provided evidence to establish a value.” Fraughton then
appealed the Board’s decision to the Commission.
¶4 At the Commission hearing in April 2017, Fraughton did
not provide comparable sales values, an appraisal, or any other
evidence of the Property’s value. Instead, he argued that the fair
market value of the Property should be based on a “reasonable
adjustment” to the purchase price instead of “speculative”
market value. In contrast, the Commission based its conclusion
on a report submitted by an appraiser for Salt Lake County. The
appraiser, relying primarily on comparable land sales, valued
1.48 acres of the Property at $8.65 per square foot and .93 acres of
the Property at $4.11 per square-foot, for a total value of $724,155
in land. The appraiser noted that nearly all of the value consisted
of the land, with the building valued at only $1,500, for a total
rounded value of $725,700 for the Property.
¶5 The Salt Lake County appraiser also stated that the
county assessor’s office contacted Fraughton and offered to
stipulate to a value of $725,700 for the Property. Fraughton had
requested an assessed value of $704,480 from the Board in
August 2015, but in October 2015, he declined to stipulate to Salt
Lake County’s adjusted lower value. These two values differ by
$21,200, or about three percent.
20170430-CA 2 2019 UT App 6Fraughton v. Tax Commission
¶6 The Commission also received evidence at the hearing, in
the form of a letter from the City, that the Property was zoned—
current as of October 2015—as RM or “Residential
Multi-Family” by the City, and it had been in that zoning
category since at least 1987. Allowed uses in RM zoning include
various residential dwellings, community and public safety
services, worship, public utilities, and daycare. Fraughton
testified that the Property was indeed zoned RM, but he
contended that this designation meant “Rural Mix,” which
allowed “a mix of agricultural and residential uses as well as an
art studio.” He further contended that the City had agreed to
this special zoning designation when he purchased the property
in 1973. 1
¶7 After considering the evidence presented, the
Commission set the fair market value of the Property at $725,700.
The Commission limited its decision to determining the
Property’s value and did not address the zoning issue.
Fraughton petitions for judicial review.
ISSUES AND STANDARDS OF REVIEW
¶8 Fraughton brings two claims. First, he contends the
Commission erred in its determination of the fair market value
of the Property. When reviewing proceedings before the
Commission, this court “grant[s] the Commission deference
concerning its written findings of fact, applying a substantial
evidence standard on review,” and grants “no deference
concerning its conclusions of law, applying a correction of error
standard, unless there is an explicit grant of discretion contained
1. No exhibit or other evidence corroborates that zone RM means
anything other than “Residential Multi-Family.” Moreover, there
is no documentary or testimonial evidence, other than
Fraughton’s recollection, that the City changed any zoning
designation of the Property.
20170430-CA 3 2019 UT App 6Fraughton v. Tax Commission
in a statute at issue before the appellate court.” Utah Code Ann.
§ 59-1-610(1) (LexisNexis 2015); see also Atlas Steel, Inc. v. Utah
State Tax Comm'n, 2002 UT 112, ¶ 14, 61 P.3d 1053 (stating that
the Commission’s findings of fact receive a substantial evidence
standard of review, but its conclusions of law receive no
deference).
¶9 Second, Fraughton argues that the Commission violated
the federal and state constitutions by basing the fair market
value of the Property on comparable property values without
taking into consideration “non-intrinsic human values,” such as
open space, history, and aesthetics. This court reviews
constitutional questions for correctness. State v. Van Dyke, 2009
UT App 369, ¶ 18, 223 P.3d 465.
ANALYSIS
I. The Commission Correctly Determined the Fair Market Value
of the Property
¶10 When challenging an assessment made on property by
the Commission, the “protesting taxpayer is required not only to
show substantial error or impropriety in the assessment, but also
to provide a sound evidentiary basis upon which the
Commission could adopt a lower valuation.” Utah Ry. Co. v. Utah
State Tax Comm’n, 2000 UT 49, ¶ 6, 5 P.3d 652 (cleaned up). Thus,
Fraughton, as the protesting taxpayer, has a two-pronged
burden. He must (1) show that the Commission made a
substantial error in arriving at the Property’s current value and
(2) provide a sound evidentiary basis for the Commission to
change the valuation. See id. 2 We address each prong in turn.
2. We note that although Fraughton recognizes the existence of
both prongs in his brief, he conflates them in his analysis by
stating that he has “provided evidence that the current value
contains error.”
20170430-CA 4 2019 UT App 6Fraughton v. Tax Commission
A. Fraughton Fails to Show That the Commission Erred in
Arriving at the Property’s Current Value
¶11 On review, Fraughton does not challenge the actual dollar
value the Commission placed on the Property; rather, he
challenges the zoning designation. Fraughton contends that the
City, in an effort to encourage completion of the purchase of the
Property, agreed in 1973 to rezone, or spot zone, 3 the Property as
“Rural Mix.” Fraughton argues that his testimony of what
happened in 1973 shows that there has been an error in the
zoning designation of the Property. He further argues that the
Commission should have obtained from the City evidence of the
Property being zoned Residential Multi-Family in 1973 if the
Property had, in fact, been zoned Residential Multi-Family at
that time. Because the City failed to provide such evidence to the
Commission, Fraughton argues that the Rural Mix zoning
designation should be grandfathered to the present. He asserts,
“The zoning as of and from 1973 should not merely be presumed
based on the [City planner’s] evidence as to the zoning . . . at
least of 1987.” In a nutshell, Fraughton’s argument is that (1) he
was told by an unidentified City official that the Property would
be spot-zoned as Rural Mix in 1973 when he purchased it and (2)
the Commission has not provided evidence that this putative
Rural Mix zoning was ever changed.
¶12 Fraughton’s argument is a classic red herring in that he is
attempting to bring the Commission into a dispute that
essentially involves a disagreement that he has with the City. 4
3. “Under Utah’s jurisprudence, spot zoning occurs when a
municipality either grants a special privilege or imposes a
restriction on a particular small property that is not otherwise
granted or imposed on surrounding properties in the larger
area.” Tolman v. Logan City, 2007 UT App 260, ¶ 15, 167 P.3d 489.
4. City records show that the Property was zoned Residential
Multi-Family from at least 1987. The Commission relied on the
(continued…)
20170430-CA 5 2019 UT App 6Fraughton v. Tax Commission
Therefore, Fraughton’s evidence about an oral pledge given in
1973 is largely irrelevant to the issue before this court. To
persuade this court, Fraughton needed to provide material
evidence that a pledge allegedly made in 1973 was acted upon
and, therefore, that the Commission made a substantial error in
arriving at the Property’s current value. See Utah Ry., 2000 UT 49,
¶ 6. Fraughton has failed to do so, and, more importantly, he has
(…continued)
City’s zoning designation to establish the assessment value of
the Property. Fraughton argues that the Commission should
investigate whether “RM” means “Rural Mix,” as Fraughton
contends, or “Residential Multi-Family,” as the City indicated in
its letter. The essence of Fraughton’s argument is that the City
has applied the incorrect zoning designation to the Property. But
the Commission’s task is to determine the fair market value of
the Property, see Utah Code Ann. § 59-2-103 (LexisNexis 2015),
not to resolve zoning disputes between residents and
municipalities. Although the zoning designation is a factor in
determining fair market value, see Palazzolo v. Rhode Island, 533
U.S. 606, 625 (2001) (stating that fair market value depends on
“restrictions on use imposed by legitimate zoning or other
regulatory limitations”), the Commission’s task is limited to
assessing and taxing property on the basis of its fair market
value as of the beginning of the calendar year. See University
Heights, Inc. v. State Tax Comm'n, 364 P.2d 661, 662 (Utah 1961)
(“[T]he authority of the Commission over local assessments is a
general supervisory one to enable it to assist in keeping the
values for property tax purposes in counties and localities on a
fair and equitable basis in relation to each other, rather than to
suppose it was intended that the Commission would maintain
active detailed supervision of the appraisals of all of the
individual properties in the state.”). Fraughton appears to
assume, but offers no support for his assumption, that the
Commission has the authority to revise the zoning designations
made by municipalities.
20170430-CA 6 2019 UT App 6Fraughton v. Tax Commission
failed to provide evidence that the Property ever was zoned
otherwise than as identified by the City in 2015.
¶13 In contrast, the Commission acted on evidence that the
Property was zoned as Residential Multi-Family in October 2015
and that it has been so zoned since at least 1987. If the Property
was zoned Residential Multi-Family in 1987, the presumption, in
the absence of evidence of a pre-1987 change to the contrary, is
that it was zoned Residential Multi-Family in the years before.
Fraughton fails to explain why his assertion regarding how the
Property was zoned in 1973 is any more credible than the
Commission’s evidence of the Property’s 2015 and 1987 zoning
designation. And as a protesting taxpayer, the evidentiary
burden is on Fraughton. Id.¶14 Fraughton admits that no change in zoning status can
occur in the absence of notice and a hearing, implying that the
Property must currently be zoned Rural Mix because there was
no notice or hearing regarding a change in the zoning to
Residential Multi-Family. Yet this is exactly what Fraughton
infers happened between 1973 and 1987 when he contends that
the Property’s zoning was improperly changed from Rural Mix
to Residential Multi-Family. One possible explanation for the
lack of evidence about notice and a hearing is that the zoning
change was done illicitly. Yet Fraughton offers no evidence of
such an illicit change other than his personal, uncorroborated
contention. A more likely and simpler explanation is that there is
no evidence of a change in zoning because the zoning
designation was never changed. In any event, even if the
Property is not currently zoned correctly, that fact does not
change the current market value. Ultimately, zoning is a point of
contention between Fraughton and the City having nothing to
do with the original assessing authority, the County. Moreover,
these facts do not inform the question on review, which is
whether an evidentiary basis exists for the Commission’s
determination.
¶15 Therefore, we conclude that Fraughton’s assertions
regarding the 1973 zoning status of the Property fail to show that
20170430-CA 7 2019 UT App 6Fraughton v. Tax Commission
the Commission erred when it relied on evidence of the
Residential Multi-Family zoning status produced by the City.
B. Fraughton Fails to Provide a Sound Evidentiary Basis to
Support Adopting a Lower Valuation
¶16 In addition to showing that the Commission made an
error in arriving at the value of the Property, Fraughton must
also provide a sound evidentiary basis for the Commission to
adopt a lower value. Utah Ry. Co. v. Utah State Tax Comm’n, 2000
UT 49, ¶ 6, 5 P.3d 652. Fraughton has not satisfied this prong
either.
¶17 At the hearing before the Commission, Fraughton did not
put forward any evidence regarding the value of the Property.
He did not provide comparable sales for the Property, nor did he
provide an appraisal or any other evidence of its value. Indeed,
Fraughton explicitly concedes that he “did not submit any
valuation evidence.” 5
¶18 In this regard, Fraughton’s case bears striking similarity
to Utah Power & Light Co. v. Utah State Tax Commission, 590 P.2d
332 (Utah 1979). There, a utility company protested the
assessment placed on one of its properties following a hearing
before the Commission. Id. at 333. After the court determined
that there had been no error in the method of assessment, it also
stated that the utility appeared to argue “that it is entitled to a
reduction of its assessment if it shows any error to its
disadvantage in the method of evaluation or the computation of
5. Fraughton may have decided not to press this point before the
Commission because the value he requested before the Board
and the value arrived at by Salt Lake County were already very
close, at least for the purpose of imposing a property tax. Rather,
Fraughton’s arguments on review center on changing the zoning
status of the Property to a more restrictive category—a change
that presumably would have resulted in a lower assessed value.
20170430-CA 8 2019 UT App 6Fraughton v. Tax Commission
the Commission’s original assessment.” Id. at 335. Because the
purpose of a proceeding before the Commission is to “determine
what should be the fair, reasonable and proper valuation and
assessment, . . . where the taxpayer claims error, [the taxpayer]
has an obligation . . . to provide a sound evidentiary basis upon
which the Commission could adopt a lower valuation.” Id. The
court noted it was “significant here that [the utility company] . . .
presented no alternative evaluation or appraisal which could be
subject to critical scrutiny by the Commission.” Id. Likewise,
here it is not enough for Fraughton to show that there has been
an error. See Utah Ry., 2000 UT 49, ¶ 6. He must also provide an
“alternative evaluation or appraisal” by which the Commission
could determine “fair, reasonable and proper valuation and
assessment” of the Property. See Utah Power & Light, 590 P.2d at
335; see also Utah Ry., 2000 UT 49, ¶ 6.
¶19 Thus, we conclude that Fraughton also failed to meet the
second prong of his burden: showing a sound evidentiary basis
to the Commission for arriving at a lower value for the Property.
II. Fraughton’s Constitutional Claim Was Inadequately Briefed
¶20 We do not reach the substance of Fraughton’s
constitutional claim because this issue has not been properly
briefed. “We have long held that we have discretion to not
address an inadequately briefed argument. Rather, a party must
plead his claims with sufficient specificity for this court to make
a ruling on the merits. We will not assume a party’s burden of
argument and research.” Angel Inv'rs, LLC v. Garrity, 2009 UT 40,
¶ 35, 216 P.3d 944 (cleaned up). “We accordingly decline to
address [an] inadequately briefed issue.” ASC Utah, Inc. v. Wolf
Mountain Resorts, LC, 2013 UT 24, ¶ 16, 309 P.3d 201.
¶21 An adequate brief provides “meaningful legal analysis”
and “fully identifies and analyzes the issues with citation to
relevant legal authority.” State v. Hawkins, 2016 UT App 9, ¶ 60,
366 P.3d 884; see also Utah R. App. P. 24(a)(8) (“The argument
must explain, with reasoned analysis supported by citations to
legal authority and the record, why the party should prevail on
20170430-CA 9 2019 UT App 6Fraughton v. Tax Commission
appeal.”). “A brief is inadequate when it merely contains bald
citations to authority without development of that authority and
reasoned analysis based on that authority.” Smith v. Four Corners
Mental Health Center, Inc., 2003 UT 23, ¶ 46, 70 P.3d 904 (cleaned
up). “Under this standard, [Fraughton] inadequately briefed this
claim. Accordingly, he fails to carry his burden of persuasion on
[judicial review].” See Hawkins, 2016 UT App 9, ¶ 60.
¶22 Fraughton argues in his brief that taxing the Property
based on its fair market value is “neither fair, equitable, or just.”
Instead of a fair market value approach, he argues that “both
state and federal constitutional principles” require the
“consideration of ‘non-intrinsic human values’” in determining a
property’s value. In support of this proposition, Fraughton
claims that the “Declaration of Independence and the United
States Constitution were written to establish a possible means for
achieving humanity’s highest form for civil human
engagement.” “[T]hese meaningful, lofty, fair and noble
principles,” Fraughton asserts, require the State of Utah to honor
the individual’s right to possess and protect property. Therefore,
Fraughton concludes, “Utah’s method of taxing real estate based
solely on ‘fair market value,’ is neither fair, equitable or just. It
entirely discriminates against any ‘non-intrinsic human values.’
As such, the tax law as applied is unconstitutional.”
¶23 In his brief, Fraughton cites only one constitutional
provision—Article 1, Section 1 of the Utah Constitution—as he
makes his argument, and this he does in passing. 6 He fails to
explain how the Commission’s fair market valuation method
6. This Article states: “All men have the inherent and inalienable
right to enjoy and defend their lives and liberties; to acquire,
possess and protect property; to worship according to the
dictates of their consciences; to assemble peaceably, protest
against wrongs, and petition for redress of grievances; to
communicate freely their thoughts and opinions, being
responsible for the abuse of that right.” Utah Const. art. I, § 1.
20170430-CA 10 2019 UT App 6Fraughton v. Tax Commission
violates this provision. He cites no case law supporting his
position that fair market valuation is unconstitutional. Nor does
he attempt to explain why the fair market value standard is
unconstitutional when the Utah Constitution itself states that
“all tangible property in the State . . . shall be . . . assessed at a
uniform and equal rate in proportion to its fair market value.”
Utah Const. art. XIII, § 2.
¶24 Fraughton’s broad statements are simply not enough to
make a cogent argument concerning the constitutional fairness,
equity, and justness of the fair market value standard. And “we
will not exercise appellate review based on our best guess as to
the subject of the appeal.” ASC Utah, 2013 UT 24, ¶ 15. As our
supreme court has “repeatedly noted, we are not a depository in
which a party may dump the burden of argument and research.”
Four Corners Mental Health, 2003 UT 23, ¶ 46 (cleaned up).
¶25 Therefore, we decline to further address Fraughton’s
constitutional arguments concerning the fair market value
standard for property tax determinations because this issue has
been inadequately briefed.
CONCLUSION
¶26 Fraughton’s arguments are unpersuasive. Fraughton has
not shown that there was an error in the assessment of the
Property, nor has he presented a sound evidentiary basis for a
lower value on the Property. Finally, we decline to address
Fraughton’s constitutional arguments concerning fair market
value because they are inadequately briefed. For the foregoing
reasons, we decline to disturb the decision of the Commission.
20170430-CA 11 2019 UT App 6