ASSESSOR OF ROGER MILLS COUNTY v. UNIT DRILLING COMPANY

ASSESSOR OF ROGER MILLS COUNTY v. UNIT DRILLING COMPANY
2011 OK 4
Case Number: 107699
Decided: 01/25/2011

THE SUPREME COURT OF THE STATE OF OKLAHOMA

NOTICE: THIS OPINION HAS NOT BEEN RELEASED FOR PUBLICATION IN THE PERMANENT LAW REPORTS. UNTIL RELEASED, IT IS SUBJECT TO REVISION OR WITHDRAWAL.

ASSESSOR OF ROGER MILLS COUNTY, Teresa Morris, Plaintiff/Appellee,
v.
UNIT DRILLING COMPANY, Defendant/Appellant.

APPEAL FROM THE DISTRICT COURT OF ROGER MILLS COUNTY
HONORABLE CHARLES L. GOODWIN

¶0 The assessor of Roger Mills County brought a declaratory judgement action to determine the constitutionality of

DECLARATORY JUDGMENT AFFIRMED.

Mart Tisdal, Patrick O'Hara, Jr., Luke Adams, Tisdal & O'Hara, PLLC, Clinton, Oklahoma, Attorneys for Plaintiff, Assessor of Roger Mills County,Teresa Morris
Richard P. Hix, Lincoln C. McElroy, McAFEE & TAFT, Tulsa, Oklahoma, Attorneys for Defendant, Unit Drilling Company

REIF, J.:

¶1 This appeal was retained by this Court because it presents an issue of statewide public concern: whether the method of valuing personal property used in the exploration of oil, natural gas, and other minerals set forth in

¶2 In support of the constitutionality of § 2817(L), the oil rig owner has stressed that Article 10, § 22 of the Oklahoma Constitution allows the Legislature to classify property for purposes of taxation and to provide for the valuation of different classes by different means or methods. Oil rig owner has maintained that § 2817(L) reflects such special classification of personal property used in the exploration of oil, natural gas, and other minerals as well as the provision of a recognized industry method or means of valuing property in this class. Oil rig owner has also asserted that the Hadco International bulletin provides a uniform standard for determining fair cash value of personal property used in the exploration of oil, natural gas, and other minerals. While we agree that these are important considerations in determining the constitutionality of a statute like § 2817(L), they are not alone determinative.

¶3 In Liddell v. Heavner,

¶4 Since 1963, this Court has said the constitutional requirement to assess property for ad valorem taxation at its fair cash value means the property's fair market value and that fair market value, in turn, means the amount of money which a purchaser willing but not obliged to buy the property would pay to an owner willing but not obliged to sell it. Bliss Hotel Co. v. Thompson,

¶5 Significantly, the Bliss Hotel Co. case stressed that fair market value, as based on a bona fide, arms-length sale "controls assessments," even if there is "other evidence tending to show what market value might be . . . in the absence of such a sale [including evidence of intrinsic value]." Bliss Hotel Co.,

¶6 A statute prescribing a method of valuation will be upheld unless it is clearly, palpably and plainly inconsistent with the fair cash value requirement of Article 10, § 8 of the Oklahoma Constitution, see Liddell,

¶7 In reaching this conclusion, we are not saying that assessments must be based on a sale of the property itself or specific sales information of comparable property. We are likewise not saying that the Legislature cannot prescribe use of the Hadco International bulletin in making assessments or that the valuation information contained therein cannot support an assessment. What we are saying is that the Legislature cannot make the Hadco International bulletin the sole and conclusive factor for valuing property for tax purposes, nor give the Hadco valuation preference over relevant and reliable market data concerning property of the same kind that has been obtained by the assessor.

¶8 Based on the foregoing considerations, we hold the trial court correctly determined that

¶9 DECLARATORY JUDGMENT AFFIRMED.

¶10 TAYLOR, C.J., COLBERT, V.C.J., WATT, WINCHESTER, EDMONDSON, REIF and COMBS, JJ., concur.

¶11 KAUGER, J., concurs in result.