Mary C. Anderson v. Town of Groton (2011)

MEMORANDUM OF DECISION

This is an appeal by plaintiff, Mary C. Anderson, the owner of real property at 52 Boardwalk, Groton Long Point in the Town of Groton, from the valuation of such property by the tax assessor of the Town of Groton in the grand list of October 1, 2006.

The assessor determined the fair market value of the subject property to be $154,200 and set forth the value of the property at 70 percent of this value or $107,940 in the grand list of October 1, 2006.   Plaintiff appealed this assessment to the Board of Assessment Appeals claiming the property to be overvalued and offered sworn to be and answer all questions concerning the property.   The Board denied plaintiffs' appeal and made no change in the amount of the assessment.

Claiming to be aggrieved by the determination of the assessor and the Board, plaintiff filed the present appeal on July 2, 2007.   The issues have been joined, the case was tried on September 15, 2010.   The evidence indicates that plaintiff acquired title to the subject property by the following deeds:

1. from Arthur Ashby Anderson, dated December 25, 1979, and recorded in the Groton Land Records at Volume 337, page 186;

2. from William G. Anderson, dated December 29, 1979, and recorded in said land records at Volume 337, page 187;

3. from Frederic P. Anderson, dated November 28, 1980, and recorded in said land records at Volume 347, page 303;

4. from Robert P. Anderson, Jr., dated November 28, 1980, and recorded in said land records at Volume 347, page 304.

The subject property is located in the prestigious waterfront community of Groton Long Point at 52 Boardwalk.   It consists of a strip of land approximately 20' wide by 87' long.   It is a rear parcel accessed only by a 5' wide passageway available for use by residents of Groton Long Point.   The property fronts on the association owned boardwalk and beach.   It does not include ownership of the beachfront or waterfront.

The property is improved by a 221 square foot wood framed bathhouse.   It includes a 97 square foot open porch and a 229 square foot wood deck.   It has no partitions, insulation, heat or hot water, but does include a toilet and sink.   The building cannot be used for sleeping.   The parcel has no on-site parking and no available street parking.   In 1989, the owners unsuccessfully appealed to the Superior Court a decision of the zoning authority denying residential use of the subject property.   Its only permitted use is as a bathhouse.   Enlargement of the building is not possible.

The complaint sets forth a claim of overvaluation pursuant to Connecticut General Statutes § 12–117a.

“Section 12–117a, which allows taxpayers to appeal the decisions of municipal boards of [assessment appeals] to the Superior Court, provide[s] a method by which an owner of property may directly call in question the valuation placed by assessors upon his property ․ In a Section 12–117a appeal, the trial court performs a two step function.   The burden, in the first instance, is upon the plaintiff to show that he has, in fact, been aggrieved by the action of the board in that his property has been over assessed ․ In this regard, [m]ere overvaluation is sufficient to justify redress under [Section 12–117a], and the court is not limited to a review of whether an assessment has been unreasonable or discriminatory or has resulted in substantial overvaluation ․ Whether a property has been overvalued for tax assessment purposes is a question of fact for the trier ․ The trier arrives at his own conclusions as to the value of land by weighing the opinion of the appraisers, the claims of the parties in light of all the circumstances in evidence bearing on value, and his own general knowledge of the elements going to establish value including his own view of the property ․”Only after the court determines that the taxpayer has met his burden of proving that the assessor's valuation was excessive and that the refusal of the board of [assessment appeals] to alter the assessment was improper, however, may the court then proceed to the second step in a Section 12–117a appeal and exercise its equitable power to grant such relief as to justice and equity appertains ․ If a taxpayer is found to be aggrieved by the decision of the board [assessment appeals], the court tries the matter de novo and the ultimate question is the ascertainment of the true and actual value of the applicant's property ․ If the court finds that the property has been in fact overvalued, it has the power to, and should, correct the valuation.”  (Citations omitted;  internal quotation marks omitted.  Konover v. West Hartford, 242 Conn. 727, 734–36 (1997).

The first step which the court must take in deciding this appeal therefor is to determine whether the plaintiff has been aggrieved by the decision of the Board of Assessment Appeals on the ground that her real property has been overassessed and that the Board improperly refused to reduce the assessment to a correct value.   In making this determination, it is necessary for the court to arrive at a preliminary conclusion concerning the fair market value of the subject property.

In this case, the defendant chose not to employ the services of an independent appraiser to value the subject premises.   Rather, the defendant town offered the testimony of its tax assessor on his method and conclusions regarding how he valued the plaintiff's property.   On October 1, 2006, the tax assessor determined the fair market value of the subject property to be $154,200 and the assessed value to be $107,940.

Plaintiff's appraiser determined the fair market value of the subject property, on October 1, 2006 to be $40,000.

The highest and best use of the property is commonly accepted by real estate appraisers as the starting point for any analysis of the true and actual value of the property regardless of the method of valuation.  Commissioner of Transportation v. Bakery Place, 83 Conn.App. 343, 350 (2004).   In the present case, the plaintiff's appraiser and the defendant's assessor and the best evidence indicates that the highest and best use of the subject property would be its continued use as a bathhouse.   The defendant offered additional unconvincing evidence that the subject property might be combined with adjacent property to create a potential building lot.   The testimony, however, was speculative at best.   There was no evidence presented that the plaintiff or her neighbor had ever contemplated such a transaction or even entertained such a thought.

The court must arrive at its conclusion as to the value of the subject property by weighing the opinions of the appraiser and assessor and the claims of the parties in light of all of the circumstances in evidence bearing on value and the court's general knowledge of the elements going to establish value.  Konover v. West Hartford, supra, 242 Conn. 735;  Route 188, LLC v. Town of Middlebury, 93 Conn.App. 123 (2006).

In order to prove that the town over evaluated the subject premises, the plaintiff offered the testimony of Robert H. Silverstein, MIA, SRA. He is an experienced appraiser who has testified on many occasions.   In his appraisal report, which was admitted into evidence, he uses the sales comparison approach as the only reliable approach for the valuation of land with minimal improvements.   He offered that the subject property must be compared to the sale of other unbuildable strips of land that have some value, although relatively modest value.   It was Mr. Silverstein's opinion that the value of the plaintiff's property on October 1, 2006 was $40,000.

In researching comparable sales, Mr. Silverstein found no sales of comparable beach house use properties.   He then looked to sales of comparable nonbuildable lots in waterfront locations and found none in Groton.   He then sought data from surrounding waterfront towns, ultimately settling on six properties to compare to the subject premises.

Comparable No. 1 is located on Pequot Avenue, New London.   This property is a .22–acre private beach front lot purchased for $58,000 on September 28, 2006, by a neighbor who lived across the street.   Mr. Silverstein concludes that this parcel is superior to the subject premises because it includes private ownership of the beach and waterfront.   On cross examination, however, Mr. Silverstein acknowledged location wise, all things equal, Groton Long Point value exceeds Pequot Avenue value.

Sales comparisons Nos. 2 and 3 are located in Lord's Point in Stonington and were purchased together on August 29, 2006, for assemblage purposes.   The respective purchase prices of these parcels were $50,000 and $25,000.   A total of three lots were combined to create a .46–acre building lot with no water view.   The lots standing alone were not buildable, but because they were purchased by one person who assembled them to create a buildable lot, Mr. Silverstein adjusted the value of each according to their contribution to the whole.

Mr. Silverstein's comparable No. 4 is described as marshland in Lord's Point purchased on April 10, 2007 for $10,000, $5,000 for each of two lots which were joined but still unbuildable.   He adjusted it upwards by adding $30,000 additional value apparently because it affords the owner rights to a recreational association.

Comparable Nos. 5 and 6 are nonbuildable waterfront parcels located in Pawcatuck.   No. 5 was purchased for $16,000 on August 22, 2006;  No. 6 was purchased for $10,000 on August 7, 2006.   They were chosen by Mr. Silverstein because they were nonbuildable and had some sort of water access.

All of Mr. Silverstein's comparables were adjusted by $20,000 for the contributory value of the plaintiff's bathhouse.   He made various additional adjustments to the comparables for site/view which included differences in water frontage, view, topography and location.

If anything is clear, it is that Groton Long Point is an unusual and special neighborhood.   The plaintiff's parcel stands alone in this unique setting, rendering it difficult to be compared.   Of particular interest, however, was the evidence regarding the purchase of 0 West Shore Avenue.   On August 3, 2006, the owner of 218 West Shore Avenue purchased this adjacent undevelopable vacant parcel for $60,000.   Mr. Silverstein had overlooked this transaction during his investigation on behalf of the plaintiff's claim.

Mr. Silverstein testified on cross and redirect examinations that 0 West Shore Avenue was significant and if he had been aware of this sale he would have used it as a comparable in his appraisal report.

0 West Shore Avenue is .03 acres;  the subject parcel is .04 acres.   0 Shore Avenue has frontage which provides for parking.   The acquisition of 0 West Shore Avenue by its neighbor added to the setback requirements of that lot which allows for an expansion of the house at 218 West Shore Avenue.   Mr. Silverstein agreed further that the $60,000 sales price for 0 West Shore Avenue should be adjusted by $20,000 for the contributory value of the bathhouse on the subject property.   He then emphasized the parking differences between the plaintiff's parcel and 0 West Shore Avenue.   He suggested an adjustment of $50,000 off the sale price for parking.   From the evidence it appears that 0 West Shore Avenue may have a limited view of the water, but it clearly is an internal lot and not “on the water,” as is the subject property.

As noted, the defendant chose to use the town's appraiser, John Philip, as its expert in defense of the plaintiff's claim.   Mr. Philip has been the town's assessor since 1999.   He explained that Groton Long Point is considered a neighborhood within the Town of Groton and that within Groton Long Point there are five or six broad categories of land.

Mr. Philip attempted to explain the difference between a primary lot, with little or no water influences;  waterfront lots, in general;  secondary sites;  and waste, typically march land or ledge.   Within each of these categories, he makes adjustments for size differences and a better type of waterfront or a worse type of waterfront than the neighborhood average.

The subject property he called a secondary site, unbuildable, but of some value.   Mr. Philip testified that for each of the five or six categories of land, he assigns a model value.   A primary building site with no water influence is valued at $337,500.   The waterfront in general is valued at $1,100,000.   On the boardwalk there is a ten percent deduction because there is no frontage on the public right-of-way.   That would be $990,000 for .14 hundredths of an acre which is sufficient under the zoning requirements to build, apparently.   For that size, the assessor adds $185,000.   As an undersized secondary site, however, the subject premises was reduced to $154,000.   Given the additional limitations, a further ten percent was deducted for a total reduction of twenty-five percent.   On cross examination, Mr. Philip explained that his appreciation of the subject premises' deficiencies led to an arbitrary additional reduction.  “We took twenty-five percent off.   We could have taken ten percent off.   We could have taken 35 percent off.   It was something that we thought was a reasonable adjustment in addition to the fact that we already considered it unbuildable.”  (Transcript p.40.)

On cross examination, Mr. Philip acknowledged that due to the uniqueness of Groton Long Point he does not use a comparable sales approach to establish the fair market value of real estate.   In fact, the August 3, 2006 sale of 0 West Shore Avenue is the only known comparable sale in Groton Long Point through the date of the hearing, on September 15, 2010.

Accordingly, Mr. Philip uses the market adjusted cost value, which is the value of the land plus the replacement cost of the building minus depreciation.   Comparable sales are developed as models, but the town does not develop comparable sales valuation estimates for vacant land.   A multiple regression analysis is used to develop adjustments for deviations in the subject and the sale.   It is here, while explaining his methodology, however, that the deficiencies in the town's explanation are highlighted.  “But to be perfectly honest with you, it's a good second method in the context of a mass appraisal, but to administer it through time and to explain multiple regression analysis, it's just not something I choose to do.   This is a traditional way and it's worked for decades.”  (Transcript, p.38.) Mr. Philip's opinion may be accurate, clear and obvious to him, but his “explanation” left the court confused and unconvinced.   The town's decision to use its employee instead of an independent appraiser proved to be an ill advised trial tactic.

The defendant next called Gordon Lange, Groton Long Point Zoning Enforcement Officer for the last ten years.   Mr. Gordon testified briefly regarding whether the subject property if combined with its neighbor's parcel would constitute a buildable lot.   His opinion was that the abutter and the subject property, if joined, would revert to its original buildable size and shape.   Mr. Lange acknowledged, however, that he was aware of no such interest by the owners of either parcel.   His testimony was supposition, speculation and not useful to the resolution of this appeal.

There are three accepted methods of valuation which may be used for the assessment of real property.   They are the comparable sales approach, income capitalization approach and cost approach.  Sun Valley Camping Cooperative, Inc. v. Stafford, 94 Conn.App. 696, 702–03 (2006).   No one method of valuation is controlling and the court may select the one most appropriate to the case before it.  Sheridan v. Killingly, 278 Conn. 252, 259 (2006).   In this case, the plaintiff's appraiser relied on the comparable sales approach to arrive at his determination of the fair market value of the subject property.   This was entirely appropriate given the nature of the subject property.   While Mr. Silverstein's approach was appropriate, his thoroughness was suspect.   On the other hand, Mr. Philip's approach appeared arbitrary and was confusing and also suspect.   Regardless of the shortcomings of both parties' experts, there was agreement that the transaction concerning 0 West Shore Avenue, on August 3, 2006, provides significant and useful information.

Given the uniqueness of Groton Long Point, its limited vacant parcels and rare sales, Mr. Silverstein attempted to logically measure other area waterfront parcels against the Anderson property.   His opinions are far from overpowering, but they are credible.   His omission of 0 West Shore Avenue is glaring.   When the evidence is taken as a whole, the plaintiff has tipped the scales not far, but sufficiently to meet her burden.   The premises in issue has been overvalued by the defendant and the plaintiff has thus proven aggrievement.

The court must now arrive at its own conclusions as to the value of the Anderson property by weighing the opinions of the experts, the claims of the parties in light of all circumstances in evidence bearing on value, and its own general knowledge of the elements going to establish value.   See Cadlerock Properties Joint Venture, L.P. v. Ashford, 98 Conn.App. 556, 560 (2006).

Property in Groton Long Point is in the upper end of the value range for Southeastern Connecticut waterfront properties.   Groton Long Point is an area of well-maintained homes enjoying frontage on beautiful Long Island Sound.   The area where the plaintiff's property is located is ideal for swimming, boating, fishing and general enjoyment of the beach community.   By reputation, it is a wonderful place to live.   When measuring the parcel in question against the “norm,” however, 52 Boardwalk has significant limitations.   In short, the owner cannot live there, she can enjoy visits.   Despite the shortcomings of the subject premises, its value exceeds the opinion of the plaintiff's expert.   While the issue of plaintiff's aggrievement has been resolved, plaintiff's proof that her property is worth $40,000 is unconvincing.

Looking at the most relevant information, the owner of 218 West Shore Avenue purchased 0 West Shore Avenue for $60,000 on August 3, 2006.   0 West Shore Avenue is twenty-five percent larger than the subject premises mandating an upward adjustment.   Both parcels standing alone are undersized and unbuildable.   Unlike the speculative testimony regarding Mrs. Anderson and her neighbor, however, 0 West Shore Avenue was actually purchased by its abutter.   There is frontage and parking and the possibility of an expansion of the improvement on 218 West Shore Avenue.   On the other hand, 52 Boardwalk has a structure, while 0 West Shore Avenue is vacant land.   Mr. Silverstein made a $20,000 adjustment to his comparables taking into account the Anderson bathhouse.   The town assigned a value of $27,600 to the bathhouse.   The bathhouse may be basic, but it appears well-maintained, useful and clearly charming.   Its location is prime and takes in a full spectacular view of Long Island Sound.   0 West Shore Avenue is not “on the waterfront” and appears to be an internal lot with obstructed views of the water, given the maps in evidence.

The Anderson property derives its enhanced value from its location within the Groton Long Point neighborhood.   Direct access to Long Island Sound adds to its worth.   It has a magnificent view of open water.   It has a modest, but quaint, improvement which allows for enhanced enjoyment of the parcel.

Considering all of the evidence, it is found that the fair market value of the subject property on the assessment date of October 1, 2006, was $110,000.   Since this figure is less than the amount determined by the assessor and the Board of Assessment Appeals, it is found that 52 Boardwalk has been overvalued and, therefore, the plaintiff is found to be aggrieved.   The fair market value on the assessment date having been determined to be $110,000, justice and equity require that the value of 52 Boardwalk on the assessment list of October 1, 2006 be reduced.

Accordingly, judgment may enter in favor of the plaintiff, without costs to either party, and it is ordered that the tax assessor adjust the value of the subject property on the grand list of October 1, 2006 to $110,000.

Martin, J.

Martin, Robert A., J.