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CONVENTION HEADQUARTERS HOTELS, LLC, Petitioner, v. MARION COUNTY ASSESSOR, Respondent.
ORDER ON PETITIONER'S MOTION TO STRIKE
In June of 2019, Convention Headquarters Hotels, LLC (“Convention HQ”) filed a direct appeal with this Court challenging the 2010 assessment of its real property. The parties concurrently filed counter motions for partial summary judgment and Convention HQ also filed a motion to strike. This Order resolves Convention HQ's motion to strike (“Motion”). Upon review, the Court grants Convention HQ's Motion in part and denies it in part.
Convention HQ owns real property located in downtown Indianapolis. (Pet'r Pet. Jud. Rev. (“Pet'r Pet.”) ¶ 6.) The property, comprised of the JW Marriott hotel and several other improvements, is situated on 4.382 acres of land. (Pet'r Pet. ¶¶ 6, 15.) During the 2010 tax year, the property was under construction; the hotel building was only partially-complete. (See Pet'r Pet. ¶¶ 16-18.) As a result, the Assessor used a “percentage complete” factor to assess the partially-complete improvements and assigned the property a total assessed value of $86,987,100. (See Pet'r Pet. ¶¶ 20-21.)
Convention HQ subsequently came to believe that its assessment violated the Equal Protection and Due Process Clauses of the U.S. Constitution, its civil rights pursuant to 42 U.S.C. § 1983 (the “1983 Claim”), the Property Taxation and Equal Privileges and Immunities Clauses of the Indiana Constitution, and Indiana's market value-in-use standard. (See Pet'r Pet. ¶¶ 44-96.) Upon exhausting all of its administrative remedies, Convention HQ filed a direct appeal with this Court in June of 2019 pursuant to Indiana Code § 6-1.1-15-5(g) because the maximum time for the Indiana Board to issue its final determination had elapsed. (See Pet'r Pet. ¶¶ 4, 7-13.) See also, e.g., Ind. Code § 6-1.1-15-5(g) (2021) (providing that the Tax Court hears direct appeals filed pursuant to Indiana Code § 6-1.1-15-5(g) de novo); Convention Headquarters Hotels, LLC v. Marion Cnty. Assessor (CHH III), 132 N.E.3d 77, 81, 84 (Ind. Tax Ct. 2019) (discussing the Tax Court's de novo standard of review for direct appeals filed under Indiana Code § 6-1.1-15-5(g)). Thereafter, the parties filed several procedural motions that the Court subsequently resolved.1
On June 17, 2020, Convention HQ moved for partial summary judgment on its equal protection, due process, property taxation, and equal privileges and immunities claims. (Pet'r Mot. Partial Summ. J.) In its motion, Convention HQ asserted that it was entitled to summary judgment because the Assessor violated its federal and state constitutional rights by failing to assess most of the other partially-complete commercial buildings within his jurisdiction between the 2006 and 2019 assessment dates. (See, e.g., Pet'r Br. Supp. Pet'r Mot. Partial Summ. J. (“Pet'r Br.”) at 1.)
That same day, the Assessor filed his own motion for partial summary judgment, asserting that he was entitled to judgment as a matter of law on the Indiana constitutional claims and the 1983 Claim. (See Resp't Br. Supp. Mot. Partial Summ. J. (“Resp't Br.”) at 5-16.) For purposes of the summary judgment motions, the Assessor's designations of evidence consisted of the following:
1. the first affidavit of Jeff Hill with attachments of Convention HQ's administrative appeal forms (Exhibit R-1), documents that were faxed to the Assessor's office (Exhibit R-2), emails concerning the subject property (Exhibit R-3), a memorandum prepared by Convention HQ's former tax representative (Exhibit R-4), and documents that the former tax representative provided to the Assessor's office (Exhibit R-5);
2. Convention HQ's responses to written discovery (Exhibit R-6), the deposition transcript of Convention HQ's 30(B)(6) witness Mark Jindra (Exhibit R-7), and the Assessor's responses to written discovery (Exhibit R-8);
3. the second affidavit of Jeff Hill with attachments of documents regarding Convention HQ's preliminary 2010 assessment (Exhibit R-9), exhibits from the administrative proceedings (Exhibit R-10), aerial photographs of various properties (Exhibit R-11), and documents relating to Parcel 1026770 (Exhibit R-12); and
4. documents relating to several other parcels (Exhibit R-13).
(See Resp't Mot. Partial Summ. J. & Des'g Evid. Supp. Mot. and Resp't Des'g Evid. Supp. Resp. (hereinafter and collectively, “Designations”).)
On July 17, 2020, Convention HQ filed its Motion, claiming that most of the Assessor's designated evidence did not comply with all the requirements of Indiana Trial Rule 56. (See Pet'r Resp. Resp't Mot. Partial Summ. J. (“Pet'r Resp. Br.”) at 4 n.2, 21-23.) (See also Pet'r Reply Br. Supp. Pet'r Mot. Partial Summ. J. (“Pet'r Reply Br.”) at 2-12.) The Court held a hearing on the Motion remotely on September 10, 2020. Additional facts will be supplied when necessary.
Indiana's summary judgment process is a desirable tool that allows the Tax Court, when functioning as a trial court, to dispose of cases where only legal issues exist. See Hughley v. State, 15 N.E.3d 1000, 1003 (Ind. 2014). Indiana Trial Rule 56 permits a party to designate affidavits and other forms of evidence on which it relies upon to support its motion for summary judgment. Ind. Trial Rule 56(C), (E). If a party's designated evidence contains statements or matters that are inadequate under Trial Rule 56, the complaining party has a duty to direct the Court to the defective evidence by filing an objection or a motion to strike. See Avco Fin. Servs. of Indianapolis, Inc. v. Metro Holding Co., 563 N.E.2d 1323, 1327 (Ind. Ct. App. 1990).
Convention HQ claims that “most of the Assessor's [designated] evidence should be disregarded or stricken entirely” because it fails to comply with Indiana Trial Rule 56(C) and (E). (See Pet'r Reply Br. 3-12; Pet'r Resp. Br. at 4 n.2.) Specifically, Convention HQ claims that the Assessor's designations of Exhibits R-5 and R-7 through R-13 as evidence do not satisfy the requirements of Trial Rule 56(C). (See Pet'r Reply Br. at 7-12.) In addition, Convention HQ claims that the Assessor's designations of the two affidavits of Jeff Hill are at odds with the requirements of Trial Rule 56(E). (See Pet'r Reply Br. at 4-7.)
I. Trial Rule 56(C)
When filing or responding to a motion for partial summary judgment, a party must “designate to the court all parts of pleadings, depositions, answers to interrogatories, admissions, matters of judicial notice, and any other matters on which it relies for purposes of the motion” or response. T.R. 56(C). Because Trial Rule 56(C) compels a party to identify the “parts” of any document upon which it relies, a party may not designate various pleadings, discovery materials, affidavits, or other documents in their entirety. See Filip v. Block, 879 N.E.2d 1076, 1081 (Ind. 2008). A party's designation, however, does not need to take a particular form; “[i]t is sufficient so long as it informs the court regarding the specific material upon which the party relies in support of or in opposition to a summary judgment motion.” Nyby v. Waste Mgmt., Inc., 725 N.E.2d 905, 910 (Ind. Ct. App. 2000) (citation omitted), trans. denied.
Furthermore, “when ruling on a motion for summary judgment, this Court will only consider properly designated evidence that would be admissible at trial.” Miller Pipeline Corp. v. Indiana Dep't of State Revenue, 995 N.E.2d 733, 735 (Ind. Tax Ct. 2013) (citation omitted). Thus, by way of example, the Court would not consider unsworn statements and unverified exhibits because that evidence would not qualify as proper Rule 56 evidence. Smith v. Delta Tau Delta, Inc., 9 N.E.3d 154, 159 (Ind. 2014); Markley Enters., Inc. v. Grover, 716 N.E.2d 559, 565 (Ind. Ct. App. 1999) (providing that courts should disregard inadmissible hearsay evidence when ruling on motions for summary judgment).
In its brief, Convention HQ asks the Court to strike or disregard Exhibits R-5 and R-7 through R-13. (See Pet'r Reply Br. at 10.) Convention HQ explains that the Assessor's designations of these exhibits are “problematic” because the Assessor has not provided the specificity required by Trial Rule 56(C) given that, in most instances, he did not identify the specific portions of the exhibits that supported his arguments. (See Pet'r Reply Br. at 7-10.)
The purpose of the specificity requirement in Trial Rule 56(C) is to decrease the amount of evidentiary material a court must sift through when ruling on a summary judgment motion. O'Connor by O'Connor v. Stewart, 668 N.E.2d 720, 721-22 (Ind. Ct. App. 1996); see also Kissell v. Vanes, 629 N.E.2d 878, 880 (Ind. Ct. App. 1994) (explaining that it is not a court's responsibility to search the record and piece together a party's summary judgment argument for it). The Assessor's designations of Exhibits R-5 and R-7 through R-13 contravene that purpose for two reasons.
First, Exhibits R-5, R-7 through R-11, and R-13, which consist of an attachment to Hill's first affidavit, a deposition transcript, the Assessor's written discovery responses, all of the attachments to Hill's second affidavit, and documents regarding other parcels, total 2,751 pages. (See Resp't Exs. R-5, R-7 to R-11, R-13.) Even though the Assessor listed these exhibits in his Designations, his briefs do not refer to most of them at all. (See Resp't Br. at 1-16 (failing to refer to Exhibits R-5, R-7, R-9 to R-11, R-13); Resp't Resp. Pet'r Br. (“Resp't Resp. Br.”) at 1-15 (failing to refer to Exhibits R-7, R-9 to R-11); Resp't Reply Pet'r Resp. (“Resp't Reply Br.”) at 1-6 (failing to refer to Exhibits R-5, R-7, R-9 to R-11).) Moreover, in nearly every instance where the Assessor has referred to these exhibits in support of his summary judgment arguments, he designates the entirety of the exhibit without any corresponding or subsequent explanation why all the information is required. (See Resp't Br. at 5, 7 (citing Resp't Ex. R-8); Resp't Resp. Br. at 3-4, 6 (citing Resp't Exs. R-5, R-8, R-13); Resp't Reply Br. at 5 (citing Resp't Exs. R-8, R-13).) There is, however, one exception where the Assessor provided some specificity. Specifically, in his reply brief the Assessor identified the specific page of Exhibit R-13 that supports his argument. (Resp't Reply Br. at 6 (citing Resp't Ex. R-13 at 1372).) Accordingly, while the Court will consider the specifically designated part of Exhibit R-13 in ruling on the parties’ counter motions for partial summary judgment, it must disregard the remainder of that exhibit along with all the information set forth in Exhibits R-5 and R-7 through R-11. See Miller Pipeline, 995 N.E.2d at 735-36 (explaining that to comply with the specificity requirement, a party must make specific reference to the relevant part of the document regardless of how concise or short the document is).
Second, the Assessor's designation of Exhibit R-12, which contains 39 pages of information about Parcel 1026770, has many of the same problems. (See Resp't Ex. R-39.) Indeed, the Assessor again generally invites the Court to scour every page of the exhibit to find the relevant parts because the few times he referred to the exhibit, he designated it in its entirety. (See Resp't Br. at 1-16 (failing to refer to Exhibit R-12); Resp't Resp. Br. at (citing Ex. R-12); Resp't Reply Br. at 1-6 (failing to refer to Exhibit R-12).) Nonetheless, as was the case with Exhibit R-13, the Assessor did specifically designate information on a single page of Exhibit R-12 to support his arguments. (See Resp't Resp. Br. at 3 (citing Resp't Ex. R-12 at 275).)
The specifically designated portion of Exhibit R-12 is an article from the Indianapolis Business Journal weekly newspaper that states: “While under construction, Parcel 1026770, at 733 N. Capitol Ave. was referred to by the IBJ as a ‘hulking pile of code violations’ before it was sold for less than the assessed value of the land alone.” (Ex. R-12 at 275.) Convention HQ asserts that the Court cannot consider this statement because it constitutes hearsay. (See Pet'r Reply Br. at 10-12.)
Hearsay is a statement, other than one made by a declarant while testifying at trial or hearing, offered in evidence to prove the truth of the matter asserted. Ind. Evidence Rule 801(C). Here, the Assessor offers this information as evidence of the truth of the matter asserted (i.e., that Parcel 1026770 was a “hulking pile of code violations” before it was sold). (See Resp't Resp. Br. at 3.) Because the designated article's author/source (i.e., the declarant) has not testified to the asserted fact, the Court finds this designated information is inadmissible hearsay evidence. See Evid. R. 801(C). See also, e.g., Feliciano v. State, 467 N.E.2d 748, 749 (Ind. 1984) (providing that “[n]ewspaper articles are, of course, by their very nature, hearsay and for that reason are seldom proper evidence to prove any fact, except the bare fact of their publication”). Therefore, the Court will not consider any portion of Exhibit R-12 when ruling on the counter motions for partial summary judgment.
II. Trial Rule 56(E)
As previously stated, Trial Rule 56 authorizes a party to designate affidavits or other types of evidence in support of or in opposition to a motion for summary judgment. T.R. 56(C), (E). Specifically, subsection (E) of the rule provides:
Supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein. Sworn or certified copies not previously self-authenticated of all papers or parts thereof referred to in an affidavit shall be attached thereto or served therewith.
Ind. Trial Rule 56(E). The requirements of this rule are mandatory; consequently, when a court considers a motion for summary judgment, it should disregard any inadmissible information contained in supporting or opposing affidavits. Estate of Neterer v. Indiana Dep't of State Revenue, 956 N.E.2d 1214, 1219 (Ind. Tax Ct. 2011), review denied.
In its brief, Convention HQ asks the Court to disregard either all or a portion of the two designated Hill affidavits, claiming that neither complies with the mandates of Trial Rule 56(E). (See, e.g., Pet'r Reply Br. at 3-7.) Convention HQ explains that these affidavits are flawed for purposes of Rule 56(E) because they are not based on Hill's personal knowledge, contain statements that are inadmissible hearsay, and contain other unreliable, inadmissible statements. (See Pet'r Resp. Br. at 21-23; Pet'r Reply Br. at 4-7.)
A. Personal Knowledge
Convention HQ argues that Hill's affidavits “are not consistent with the requirements or Trial Rule 56(E)” because their affirmation clauses simply provide that his “ ‘representations were true to the best of his knowledge and belief.’ ” (Pet'r Reply Br. at 5 (quoting, e.g., Hill Aff. at 3 (emphasis added)).) Convention HQ explains that this language makes it impossible to discern exactly which of Hill's statements are based on his belief and which, if any, are based on his personal knowledge. (See Pet'r Reply Br. at 4-5.) (See also Hr'g Tr. at 124 (arguing that nothing in Hill's affidavits establishes that they are based on “his personal perceptions”).) Convention HQ therefore asks the Court to strike the affidavits outright because they appear to be based on Hill's belief rather than his personal knowledge. (Pet'r Reply Br. at 5.)
Convention HQ's argument, however, focuses solely on the language used in the affirmation clauses at the end of the affidavits, ignoring the second paragraph of each affidavit where Hill averred that he had “personal knowledge of the facts in [each] affidavit.” (Hill Aff. ¶ 2; Second Hill Aff. ¶ 2.) There is no evidence to refute or question Hill's sworn testimony. Additionally, both affirmation clauses use the word “and” rather than the word “or” to link Hill's knowledge and Hill's belief, indicating that Hill's statements are made on both his personal knowledge and his belief, not one over the other. See Webster's Third New Int'l Dictionary 80 (defining the word “and” as “along with or together with”), 1585 (defining the word “or” as “a function word to indicate (1) an alternative between different or unlike things, states, or actions[;] ․ (2) [a] choice between alternate things, states, or courses”) (2002 ed.).
Moreover, a summary judgment affidavit does not need to “ ‘contain an explicit recital of personal knowledge when it can be reasonably inferred from its contents that the material parts thereof are within the affiant's personal knowledge.’ ” DeLage Landen Fin. Servs., Inc. v. Cmty. Mental Health Ctr., Inc., 965 N.E.2d 693, 701 (Ind. Ct. App. 2012) (citation omitted), trans. denied. In this case, Hill established both his personal knowledge of the underlying facts and his competency to testify to those facts by stating that as a Commercial and Industrial Valuation Analyst for the Marion County Assessor's Office, he was familiar with a variety of property data, including aerial photographs, building permits, and even certain litigation-related materials. (See, e.g., Hill Aff. ¶¶ 3-4, 10-13; Second Hill Aff. ¶¶ 3-4, 9-10.) Based on his personal knowledge and competency, Hill set forth a variety of facts in his affidavit, including the fact that he was involved with the 2010 assessment of the JW Marriott. (See, e.g., Hill Aff. ¶ 5.) Consequently, the Court will not strike or disregard any portion of Hill's affidavits on the basis that they were not based on Hill's personal knowledge.
Next, Convention HQ asks the Court to strike paragraphs 13 through 15 of Hill's second affidavit. (See Hr'g Tr. at 48-54.) In summary, these paragraphs state that aerial photographs, publicly available records, and taxpayer provided data show that the uses of certain parcels as well as the framing types and wall types of certain partially-complete buildings could not be determined on the relevant assessment dates. (See Second Hill Aff. ¶¶ 13-15.) Convention HQ maintains that these statements constitute inadmissible hearsay because they were offered to prove the facts asserted and are based on what a particular document indicated, not Hill's perceptions. (See Hr'g Tr. at 48-54.)
As previously explained, hearsay is an out of court statement offered into evidence to prove the truth of the matter asserted. Evid. R. 801(C). The declarative statements in paragraphs 13 to 15 of Hill's second affidavit, that certain features of the properties were not discernible on various assessment dates, were not offered to prove the facts asserted. Rather, they were offered to establish that certain properties were assessed on the relevant assessment dates and to explain why certain partially-complete buildings were assigned assessed values of zero dollars. (See, e.g., Resp't Br. at 6-7.) Accordingly, the Court, finding these statements are not hearsay, will not strike or disregard paragraphs 13 through 15 of Hill's second affidavit on this basis.
C. Inadmissible Statements
Finally, Convention HQ asks the Court to disregard paragraph 11 of Hill's first affidavit and paragraphs 13 through 15 of Hill's second affidavit, claiming that the facts stated in those paragraphs are based on nothing more than Hill's “conclusory, speculative, unsupported, and incredible assertions[.]” (See Pet'r Reply Br. at 3-7.) Moreover, Convention HQ argues that Hill's statements are also potentially inadmissible legal conclusions. (See also Pet'r Resp. Br. at 21-23.)
In its brief, Convention HQ explained that the resolution of its motion for partial summary judgment depends on whether it can establish that the Assessor failed to regularly assess all of the partially-complete commercial buildings in Marion County since the 2006 general reassessment. (See Pet'r Br. at 1.) In response to Convention HQ's assertion that he failed to assess certain properties, the Assessor designated Hill's affidavits in which Hill stated that all of the properties had been assessed based on their market values-in-use on each relevant assessment date. (See Hill Aff. ¶ 11; Second Hill Aff. ¶¶ 13-15.) The mere fact that the statements in Hill's affidavits are self-serving and provide few details about the assessments, however, does not compel the Court to find that either affidavit is inadmissible. See, e.g., Hughley, 15 N.E.3d at 1004-06 (explaining that a defendant's perfunctory and self-serving affidavit, which ultimately established material facts were in dispute, was competent evidence for purposes of the summary judgment procedure). Indeed, the statements in paragraph 11 of Hill's first affidavit and those in paragraphs 13 through 15 of Hill's second affidavit, do not dispute the legal issues in this case; rather, they appear to address the factual issues in this case, i.e., whether the Assessor assessed certain partially-complete buildings within his jurisdiction since the 2006 general reassessment. Consequently, the Court will not strike or disregard any portion of Hill's affidavits on this basis either. See AM Gen. LLC v. Armour, 46 N.E.3d 436, 441-42 (Ind. 2015) (indicating that under Hughley, the propriety of an affidavit depends on whether the statement disputes legal issues as opposed to material facts).
For the above-stated reasons, the Court GRANTS Convention HQ's Motion in its entirety with respect to Exhibits R-5 and R-7 through R-12. With respect to Exhibit R-13, however, the Court GRANTS Convention HQ's Motion in part and DENIES it in part, and with respect to Hill's first and second affidavits, the Court DENIES Convention HQ's Motion in its entirety.
SO ORDERED this 21st day of May 2021.
1. See generally, e.g., Convention Headquarters Hotels, LLC v. Marion Cnty. Assessor (CHH III), 132 N.E.3d 77 (Ind. Tax Ct. 2019) (order denying the Assessor's motion to dismiss for lack of subject matter jurisdiction and failure to state a claim upon which relief can be granted); (Order Dec. 3, 2019) (order granting Convention HQ's motion to bifurcate trial and stay valuation proceedings).
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Docket No: Cause No. 19T-TA-00021
Decided: May 21, 2021
Court: Tax Court of Indiana.
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