In this case nobody disputed the fact that from 2008 to 2009 the assessed value increase is more than 5% and according to Ind. Code § 6-1.1-15-17.2 the Respondent had the burden of proof.
The Respondent, however, did not even attempt to prove the existing 2009 assessment is correct. The Respondent conceded that the current assessed value for 2009 must be changed.
Significantly, the statute is silent about what happens when an assessor has the burden and fails to prove the assessment is correct. In similar cases, the Board returned the disputed assessment to the value determined by the county assessor for the immediately preceding assessment date. See Kaehr v. Steuben Co. Assessor, pet. no. 76-011-07-1-5-00235 (Ind. Bd. Tax Rev. March 13, 2012); Stout v. Orange Co. Assessor, pet. no. 59-007-09-1-5-00001 (Ind. Bd. Tax Rev. Nov. 7, 2011).
The Respondent offered to reduce the 2009 assessment to the figure he originally had determined for the 2008 assessment, which was $824,800. But according to the Petitioner their agreement to change the 2008 assessment to $455,400 establishes that same value for 2009, even though nothing in the terms of the agreement itself supports using the agreed value for a subsequent assessment year. In addition to silence in the statute and the settlement agreement, there are other reasons the Board will not use the 2008 settlement number for the revised 2009 assessment.
Judicial policy strongly favors settlement agreements. They allow courts to operate more efficiently and allow parties to fashion the outcome of their disputes through mutual agreement. Our Supreme Court has held that “[t]he law encourages parties to engage in settlement negotiations in several ways. It prohibits the use of settlement terms or even settlement negotiations to prove liability for or invalidity of a claim or its amount. Dep’t of Local Gov’t Fin. v. Commonwealth Edison Co., 820 N.E.2d 1222, 1227 (Ind. 2005). The strong policy justification for denying settlements precedential effect in a property tax case is that allowing parties to use the settlement would have a chilling effect on the incentive of the parties to resolve cases. Id. at 1228.
Coupled with Ind. Code § 6-1.1-15-17.2, this case presents an unusual scenario. Nevertheless, general principles about the limitations of settlements still are persuasive. There are many reasons for parties to make such agreements. We will not speculate what those reasons might have been and we will not apply the settlement to other matters. This agreement is merely a settlement whereby the 2008 appeal was withdrawn in exchanged for a specified adjustment. It does not dictate what the 2009 will be.
