c) The Trust relies mainly on the fact that it
purchased the subject property for $10,000, plus $2,000 in expenses, on
December 8, 2006. True, a property’s sale price can be compelling evidence of
its market value-in-use. The Assessor argues, and the Trust admits, the
property was purchased from Wells Fargo Bank, out of foreclosure.
d) The Manual provides the following definition of
“market value”:
The most probable price (in terms of money) which a
property should bring in a competitive and open market under all conditions
requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably,
and assuming the price is not affected by undue stimulus. Implicit in this
definition is the consummation of a sale as of a specified date and the passing
of title from seller to buyer under conditions whereby:
ii. Both parties are well informed and advised and
act in what they consider their best interests;
iii. A reasonable time is allowed for exposure in
the open market;
iv. Payment is made in terms of cash or in terms of
financial arrangements comparable thereto;
v. The price is unaffected by special financing or
concessions.
MANUAL at 10.
e) It is apparent from the Manual’s definition that
a property purchased out of foreclosure may not reflect its market value for
reasons such as a lack of exposure to the open market or the seller (i.e., the
bank) not being typically motivated. Therefore, it is incumbent upon the party
relying upon that sale to offer specific evidence to allay these concerns. See
Lake County Assessor v. U.S. Steel Corp, 901 N.E.2d 85, 91-92 (Ind. Tax Ct.
2009) review denied (approving of the use of bankruptcy sales when taxpayer
established that such sales were a market norm).
f) The Petitioner offered nothing to show that the
property was listed on the market and nothing to establish that foreclosure
sales were the market norm for the subject property’s neighborhood on January
1, 2007, and January 1, 2008.
g) However, the Assessor did not simply rest on an
assertion that foreclosure-related sales can never be used to show market
value-in-use; she offered specific evidence to support the inference that the
particular transaction at issue was not a market-value sale. Specifically, the
Assessor pointed out that prior to the foreclosure action, the subject property
sold for $59,000. The Assessor, however, offered no details about this sale.
Nonetheless, when taken as a whole, this fact raises questions about the reliability
of the December 2006 sale price as a reflection of the property’s market value.
In fact, Mr. Kollar requested that the property be assessed at a value greater than
the December 2006 purchase price. Under these circumstances, the price that the
Trust paid for the property is not probative of its market value-in-use.
h) Consequently, the Board finds that the Petitioner
failed to make a prima facie case that the 2008 and 2009 assessments are
incorrect. Where a Petitioner has not supported its claim with probative
evidence, the Respondent’s duty to support the assessment with substantial
evidence is not triggered. Lacy Diversified Indus. LTD v. Dep’t of Local Gov’t
Fin., 799 N.E.2d 1215, 1221-22 (Ind. Tax Ct. 2003).
