WALTER LINN V TOWNSHIP OF ALAIEDON
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STATE OF MICHIGAN
COURT OF APPEALS
WALTER LINN and RHEA LINN,
UNPUBLISHED
September 29, 2000
Plaintiffs-Appellants,
v
No. 218359
Tax Tribunal
LC No. 0-234944
TOWNSHIP OF ALAIEDON,
Defendant-Appellee.
Before: Kelly, P.J., and Whitbeck and Collins, JJ.
PER CURIAM.
Plaintiffs appeal as of right from the rehearing decision of the Michigan Tax Tribunal. We affirm.
Plaintiffs are the owners of a four-bedroom home located on five acres in Ingham County’s
Alaiedon Township. The home was constructed in 1995 and was assessed for the first time in 1996.
Plaintiffs protested the assessment amount at both the local board of review and the Small Claims
Division of the Michigan Tax Tribunal. Neither the small claims referee nor the Tax Tribunal judge on
rehearing adopted the parties’ proposed true cash values, but instead made their own determinations of
true cash value. The Tax Tribunal ruled that the township had overvalued the true cash value of
plaintiffs’ home and property for the purpose of real property taxation; however, the tribunal judge did
not accept plaintiffs’ proposed valuation.
Initially, plaintiffs argue that the Tax Tribunal’s finding of the property’s true cash value as of
December 1995 was in error. “In the absence of f
raud, review of a decision by the Tax Tribunal is
limited to determining whether the tribunal erred in applying the law or adopted a wrong legal principle;
its factual findings are conclusive if supported by competent, material, and substantial evidence on the
whole record.” Michigan Bell Telephone Co v Dep’t of Treasury, 445 Mich 470, 476; 518 NW2d
808 (1994). “Substantial evidence must be more than a scintilla of evidence, although it may be
substantially less than a preponderance of the evidence.” Jones & Laughlin Steel Corp v City of
Warren, 193 Mich App 348, 352-353; 483 NW2d 416 (1992). Failure to base a decision on
competent, material, and substantial evidence constitutes an error of law requiring reversal. Oldenburg
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v Dryden Twp, 198 Mich App 696, 698; 499 NW2d 416 (1993). We conclude that the Tribunal did
not err in using the market approach to assessment or finding that plaintiffs had failed to establish that the
properties in the area were not uniformly assessed.
The Michigan Constitution provides for the collection of ad valorem taxation of real property at
a rate of no more than fifty percent of the property’s assessed true cash value. Const 1963, art 9, § 3.
Additionally, the taxing unit must take location and other factors into account when assessing the
property. MCL 211.27; MSA 7.27. Real property is assessed every year for the purposes of
taxation. MCL 211.24; MSA 7.24. A property owner who disagrees with the assessment on a parcel
may seek review with the Tax Tribunal after having a request for reduction denied by a local board of
review. MCL 205.735(1); MSA 7.650(35)(1).
At both the small claims referee and tribunal judge levels of review, the burden of proof is on the
taxpayer to establish the true cash value of the property. MCL 205.737(3); MSA 7.650(37)(3);
Oldenburg, supra at 698-699. The burden of proof in a tax matter encompasses two concepts: “(1)
the burden of persuasion, that does not shift during the course of the hearing, and (2) the burden of
going forward with t e evidence, that may shift to the opposing party.” Great Lakes Division of
h
National Steel Corp v Ecorse, 227 Mich App 379, 408-409; 576 NW2d 667 (1998). While the
property tax act imposes a burden on the plaintiff to establish a true cash value, it also imposes a duty
on the Tax Tribunal to make an independent determination of such value. Id. At 410. However, the
Tax Tribunal’s duty to make its own independent determination of true cash value arises only when the
plaintiff has met its burden of going forward with evidence. Id. at 410.
Here, the Tribunal did not err in applying the law or adopt a wrong legal principle and its factual
findings are supported by competent, material, and substantial evidence on the whole record. Michigan
Bell Telephone Co, supra at 476. The Tribunal found that plaintiffs had failed to carry their burden of
proof to establish the market value of the property. At the Tribunal, defendant presented evidence of
three comparable properties within the township, while plaintiffs presented comparables from a
subdivision in Delhi Township, in another school district, without making any adjustment for these
differences. Further, the township’s assessment of the land value was similar to that of plaintiffs’
appraiser, whose appraisal greatly exceeded the substitution value plaintiffs placed on their property.
The Tribunal’s finding of true cash value is supported by the evidence, and the Tribunal did not simply
rubber stamp the assessment of the township.
Next, plaintiffs argue that the Tribunal erred in finding that in 1996 the township’s average level
of assessment was fifty percent of true cash value and that assessments were uniform. Plaintiffs’
evidence did not meet their burden of showing a lack of uniformity in the township assessment rates.
The constitutional requirement of uniformity of taxation is concerned with uniformity of rates and
assessment. Harper Creek School Dist v LeRoy Twp Supervisor, 146 Mich App 515, 532-533;
382 NW2d 172 (1985). Uniformity simply guarantees equality of the tax burden. Plymouth Twp v
Wayne Co Bd of Comm’rs, 137 Mich App 738, 749; 359 NW2d 547 (1984). “The process of
equalization is one by which the county, and then the state, seeks to enforce uniform assessment levels .
. . .” Port Sheldon Twp v Ottawa Co Bd of Comm’rs, 80 Mich App 91, 94-95; 263 NW2d 299
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(1977). Intracounty equalization requires that the county determine whether taxing units within the
county have equally and uniformly assessed property at fifty percent of true cash value. Fairplains
Twp v Montcalm Co Bd of Comm’rs, 214 Mich App 365, 369; 542 NW2d 897 (1995).
Equalization is not an exact science. Great Lakes, supra at 427.
“The General Property Tax Act, MCL 211.1 et seq.; MSA 7.1 et seq., provides for the yearly
assessment and equalization of property for ad valorem tax purposes.” Fairplains Twp, supra at 367.
The burden is on the plaintiff to show that the equalization was inequitable or discriminatory. Id. at
372. Here, while plaintiffs presented tables purporting to be an equalization study, they did not provide
any information about the equalization study or the properties sampled; therefore, they failed to meet
their burden of proof.
Further, the Tribunal did not err in failing to find that the township supervisor’s property was
assessed at a lower rate than plaintiffs’ property. The township presented evidence that plaintiffs were
incorrect about the amount the parcel was valued at, and noted that, unlike plaintiffs’ property, the
township supervisor’s property was enrolled in a farmlands program that gave the land a lower tax rate.
Plaintiffs presented no evidence that contradicted this explanation.
Finally, plaintiffs argue that the Tribunal erred in failing to rule that defendant committed fraud by
intentionally assessing some properties at below fifty percent of true cash value. However, plaintiffs did
not specifically argue that the township committed fraud in assessing their property and the Tribunal did
not directly address any fraud claim. Therefore, this issue is not preserved for review. In any event, it
appears that the Tribunal did not err by failing to find that the township fraudulently assessed township
properties.
Intentional overassessment is fraud. Sloman-Polk Co v Detroit, 261 Mich 689, 691; 247
NW 95 (1933). A valuation is fraudulent “where it is so unreasonable that the assessor must have
known that it was wrong.” Helin v Grosse Pointe Twp, 329 Mich 396, 406; 45 NW2d 338 (1951);
Turner v Lansing Twp, 108 Mich App 103, 111; 310 NW2d 287 (1981), quoting 4 Cooley,
Taxation (4th ed), § 1645. A fraudulent valuation may be proven with facts showing that valuation was
purposely made too high through prejudice, through the assessor’s reckless disregard of duty, or
through the adoption of rules that are designed to operate unequally. Helin, supra at 406-407.
Here, plaintiffs presented no evidence to support an allegation of fraud other than the
assessment card of the township supervisor. On its face, this document merely shows the valuation of
this official’s land. Plaintiffs presented nothing to show that the township assessor was biased in valuing
the properties, that the assessor recklessly disregarded his duties, or that the township adopted
inequitable rules. The sum total of plaintiffs’ evidence was proof that the
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township supervisor pays less taxes. This is insufficient under the doctrine of constructive fraud as set
forth in Helin, supra.
Affirmed.
/s/ Michael J. Kelly
/s/ William C. Whitbeck
/s/ Jeffrey G. Collins
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