In Re: Board of Tax Appeals, Appeal No. 16-A-1079.
SSI FOOD SERVICES, INC., Respondent-Appellant-Cross Respondent. BRIAN STENDER, Canyon County Assessor, Petitioner-Respondent-Cross Appellant,
from the District Court of the Third Judicial District of the
State of Idaho, Canyon County. Gene A. Petty, District Judge.
order of the district court is affirmed.
Pickens, Cozakos, PA, Boise, for Appellant-Cross Respondent.
Terri Pickens Manweiler argued.
County Prosecutor's Office, Caldwell, for
Respondent-Cross Appellant. Bradford D. Goodsell argued.
NATURE OF THE CASE
Food Services Inc. (SSI) appeals from the district
court's decision rejecting the Board of Tax Appeal's
(BTA) 2016 assessed value of SSI's food processing
facility in favor of the Canyon County Assessor's (Canyon
County) significantly higher valuation. On appeal, SSI
contends that the district court erred when it modified the
BTA's valuation because: (1) Canyon County did not meet
its burden of proving that the BTA's valuation was
erroneous; (2) the modified valuation is not supported by
substantial and competent evidence; and (3) the conclusions
of law contained in the district court's findings of fact
and conclusions of law are inadequate. SSI also appeals from
the district court's decision to allow Canyon
County's expert to testify on rebuttal. Canyon County
cross-appeals the district court's decision that SSI was
not obligated to pay penalties and interest on the unpaid
amount of property taxes. For the reasons stated below, we
affirm the district court's decision in all respects.
FACTS AND PROCEDURAL BACKGROUND
2013, SSI purchased a food processing plant in Wilder, Idaho,
which continues to operate as a meat processing facility. The
plant is located on three contiguous parcels of land in
Canyon County. The subject parcel (the property) consists of
24.69 acres of land and contains several large commercial
2016, Canyon County assessed the property for tax purposes at
$18, 286, 630, consisting of $538, 830 for the land and $17,
747, 800 for the improvements. SSI appealed the decision to the
Canyon County Board of Equalization (BOE). SSI initially
claimed the property had a market value of $11, 000, 000. The
BOE upheld Canyon County's valuation of $18, 286, 630.
SSI appealed the decision to the BTA.
meantime, both Canyon County and SSI hired experts to
appraise the property. Michael Cowan appraised the property
for Canyon County and Paul Hyde appraised the property for
SSI. Cowan initially claimed the property had a market value
of $23, 000, 000 and Hyde claimed the property had a market
value of $6, 500, 000.
hearing, the BTA held that SSI satisfied its burden of
proving that the assessed value of $18, 286, 630 was
erroneous; however, the BTA did not find adequate support for
Hyde's claimed value of only $6, 500, 000. The BTA then
reduced the value to $10, 000, 000 without further
explanation. Canyon County filed a petition for
reconsideration and rehearing. The BTA summarily denied the
petition. As a result of the reduced valuation, the Canyon
County Treasurer adjusted the amount of taxes owed to reflect
the $10, 000, 000 valuation.
25, 2017, Canyon County filed a petition for judicial review
of the BTA's decision. Trial was set to commence on March
20, 2018. Prior to trial, Cowan revised his appraisal report
twice. Hyde reviewed Cowan's first revised
appraisal. In response, Canyon County hired J. Philip Cook to
review Hyde's appraisal report, to bolster Cowan's
appraisal report, and to provide his own opinion of value if
necessary. In his initial appraisal review, Cook
reserved the "[r]ight to supplement [his] report after
inspection and to address any 'additional relevant
information' that comes to light prior to trial." On
January 15, 2018, Cook was granted access to inspect the
property and later revised his appraisal accordingly.
parties stipulated to a discovery schedule, agreeing that the
disclosure deadline for rebuttal experts was ninety days
prior to trial, or December 20, 2017. Canyon County disclosed
Cook as a rebuttal expert on December 20, 2017. SSI sought to
exclude the testimony and report of Cook, arguing that
"[t]he testimony and opinions were not timely disclosed
pursuant to the Court's Scheduling Order and the
Stipulation." The district court denied SSI's
trial, Canyon County called Cowan during its case-in-chief,
while SSI called three witnesses: Hyde, Dave Kubosumi
(SSI's engineering manager), and David Smith (SSI's
tax expert). During its rebuttal, Canyon County called Cook.
SSI renewed its motion to exclude Cook as an expert. The
court denied SSI's motion, but limited Cook's
testimony "to why he believes the opinion of Mr. Hyde is
incorrect." Cook was not allowed to "[g]o into
Hyde's criticism of Cook's report" or bolster
Cowan's report. The court also allowed Cook to express
his own opinion of value. On May 2, 2018, the district court
entered its Findings of Fact and Conclusions of Law, holding
that Canyon County "[m]et its burden to show that the
value of the property exceeds $10, 000, 000. The conclusion
of the Board of Tax Appeals was erroneous. The market value
of the property on January 1, 2016 was, for ad
valorem purposes, $17, 000, 000."
result of the district court's increased valuation,
Canyon County sought additional taxes in the amount of $97,
770.12 and interest and penalties in the amount of $18,
119.27. SSI objected to the penalties and interest. At the
hearing on the matter, Canyon County argued that it should be
entitled to interest on the underpayment of taxes during the
pendency of the appeal to the district court. SSI argued that
it did not owe interest and penalties because "[it] paid
all taxes when due." The district court entered its
Judgment on June 21, 2018, ordering SSI to pay additional
property taxes totaling $97, 770.12, with no added interest
STANDARD OF REVIEW
any taxpayer, assessor, the state tax commission or any other
party appearing before the board of tax appeals is aggrieved
by a decision of the board of tax appeals or a decision on a
motion for rehearing, an appeal may be taken to the district
court . . . ." I.C. § 63-3812. "In a challenge
to the assessor's valuation of the property, 'the
value of property for purposes of taxation as determined by
the assessor is presumed to be correct . . . .'"
Merris v. Ada Cty., 100 Idaho 59, 64, 593
P.2d 394, 399 (1979) (quoting Appeals of Sears, Roebuck
& Co., 74 Idaho 39, 46, 256 P.2d 526, 530 (1953)).
"shall be heard and determined by the court without a
jury in a trial de novo on the issues in the same manner as
though it were an original proceeding in that court."
I.C. § 63-3812(c). We have defined trial de novo to mean
"a trying of the matter anew-the same as if it had never
been heard before." Canyon Cty. Bd. of Equalization
v. Amalgamated Sugar Co., LLC, 143 Idaho 58, 61, 137
P.3d 445, 448 (2006) (quoting Gilbert v. Moore, 108
Idaho 165, 168, 697 P.2d 1179, 1182 (1985)).
burden of proof shall fall upon the party seeking affirmative
relief to establish that the decision made by the board of
tax appeals is erroneous. A preponderance of the evidence
shall suffice to sustain the burden of proof." I.C.
§ 63-3812(c). "Factual determinations are not
erroneous when they are supported by competent and
substantial evidence even though conflicting evidence
exists." Greenfield Village Apartments, L.P. v. Ada
Cty., 130 Idaho 207, 209, 938 P.2d 1245, 1247 (1997).
"Evidence is regarded as substantial if a reasonable
trier of fact would accept it and rely upon it in determining
whether a disputed point of fact has been proven."
The Senator, Inc. v. Ada Cty., Bd. of Equalization,
138 Idaho 566, 574, 67 P.3d 45, 53 (2003). "Therefore,
this Court's inquiry is limited to whether the district
court's decision, based on the testimony and evidence
received and not objected to [as incompetent], was clearly
erroneous." PacifiCorp v. Idaho State Tax
Comm'n, 153 Idaho 759, 768, 291 P.3d 442, 451
Court exercises free review over the district court's
conclusions of law to determine whether the court correctly
stated the applicable law and whether the legal conclusions
are sustained by the facts found." Id. at 767,
291 P.3d at 450 (quoting Kennedy v. Schneider, 151
Idaho 440, 442, 259 P.3d 586, 588 (2011)). This Court also
exercises free review over the construction and application
of a statute. Amalgamated Sugar Co., LLC, 143 Idaho
at 60, 137 P.3d at 447.
standard of review of a trial court's decision regarding
the admission of evidence in rebuttal is one of deference to
the trial court." Van Brunt v. Stoddard, 136
Idaho 681, 686, 39 P.3d 621, 626 (2001). "Decisions
regarding the admission of evidence are revised only upon a
showing of an abuse of discretion." Id. When
this Court reviews an alleged abuse of discretion by a trial
court, this Court must consider four essential questions:
"Whether the trial court: (1) correctly perceived the
issue as one of discretion; (2) acted within the outer
boundaries of its discretion; (3) acted consistently with the
legal standards applicable to the specific choices available
to it; and (4) reached its decision by the exercise of
reason." Lunneborg v. My Fun Life, 163 Idaho
856, 863, 421 P.3d 187, 194 (2018).
The district court did not err in modifying the BTA's
valuation of the property.
contends that the district court erred when it modified the
BTA's valuation because Canyon County did not satisfy its
burden of proof and the court's opinion of value is not
supported by substantial and competent evidence. SSI also
argues that the district court's conclusions of law are