[Cite as Worthington City Schools Bd. of Edn. v. Franklin Cty. Bd. of Revision, 129 Ohio St.3d
3, 2011-Ohio-2316.]




     WORTHINGTON CITY SCHOOLS BOARD OF EDUCATION, APPELLEE, v .
   FRANKLIN COUNTY BOARD OF REVISION ET AL., APPELLEES; BOB-O-LINK
    GOLF COURSE, LTD., N.K.A. WEBER SISTERS ENTERPRISES, APPELLANT.
[Cite as Worthington City Schools Bd. of Edn. v. Franklin Cty. Bd. of Revision,
                         129 Ohio St.3d 3, 2011-Ohio-2316.]
Taxation — Real property — Decision of Board of Tax Appeals on remand did
        not fail to follow remand instructions — Determination on remand that
        sale price represented value for taxation purposes properly considered all
        evidence in record to arrive at conclusion that sale was “recent” —
        Taxpayer failed to carry burden of showing that sale was not recent.
           (No. 2010-0900 — April 19, 2011 — Decided May 19, 2011.)
             APPEAL from the Board of Tax Appeals, No. 2006-V-381.
                                ____________________
        Per Curiam.
        {¶ 1} This is an appeal from a decision of the Board of Tax Appeals
(“BTA”) in a real property valuation case, and it comes before the court for a
second time. In Worthington City Schools Bd. of Edn. v. Franklin Cty. Bd. of
Revision, 124 Ohio St.3d 27, 2009-Ohio-5932, 918 N.E.2d 972 (“Worthington I”),
the property owner challenged the BTA’s use of the sale price as an indicator of
value on the basis that “market changes and other factors make the sale price
unreliable.” The BTA rejected that challenge and adopted the sale price as the
value of the property.
        {¶ 2} On appeal, we held that the BTA had failed to give full
consideration to whether the sale was “recent,” one of the criteria that must be
satisfied before a sale price may be used as a value for tax purposes. Id. at ¶ 34.
Instead, the BTA disposed of the issue of recency by relying solely on the
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temporal proximity of the sale to the tax-lien dates. Because proximity is not the
sole factor affecting recency and because the property owner argued that other
factors made the sale price an unreliable indicator of value, we vacated the BTA’s
decision and remanded for a proper determination of recency based on the entire
record. Id.
       {¶ 3} On April 20, 2010, the BTA issued its decision on remand. The
BTA analyzed the record and concluded that the evidence did not show a change
in the market between May 2003 and the tax-lien dates at issue, January 1, 2004,
and January 1, 2005. As a result, the BTA once again adopted the sale price as
the value of the property based on the conclusion that the presumption of recency
had not been rebutted.
       {¶ 4} The property owner has appealed, asserting that the BTA
“completely ignored the instructions of this court” in Worthington I, that the BTA
“ignored its own findings of fact and those of the Court,” and that the BTA erred
in imposing the burden of proof. We disagree, and we therefore affirm the
decision of the BTA.
                                       Facts
       {¶ 5} In Worthington I, 124 Ohio St.3d 27, 2009-Ohio-5932, 918 N.E.2d
972, we extensively discussed the evidence presented to the Franklin County
Board of Revision (“BOR”) in this case. We will not repeat that entire discussion
here, but refer instead to the most important evidence considered on remand: the
testimony of Sally Marrell, one of the principals of the property owner, Bob-O-
Link Golf Course Ltd., n.k.a. Weber Sisters Enterprises, Ltd. (“Weber Sisters”).
       {¶ 6} Weber Sisters purchased the property in May 2003 for $4,175,000,
by exchanging a golf course worth $2.4 million and by tendering the remainder of
the purchase price in cash. Marrell testified as follows:




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        {¶ 7} ● Weber Sisters’ purchase was predicated on the seller’s leasing
most of the space in the two buildings, each of which comprised 7,500 square feet
of commercial space.
        {¶ 8} ●     The price paid by Weber Sisters “was for totally occupied
units,” meaning in this case that the sale would occur with leases in place for
11,740 of the 15,000 total square feet.
        {¶ 9} ● Immediately after the May 2003 sale it became clear that two
tenants slated to occupy the largest portions of the buildings — Boston Market
and Fiesta Fresh — would not take possession. The former initially honored rent
obligations; the latter did not.
        {¶ 10} ● During 2004, tenant Cold Stone Creamery began paying less
and less and ultimately vacated its leased premises during 2005 and defaulted on
its lease obligations.
        {¶ 11} ● Another tenant, Mark Pi’s, experienced financial difficulty and
negotiated a rent reduction of approximately one-third. An Indian restaurant
stopped paying rent as of November 2005. Another tenant, Robeck’s Juice,
subleased to Quizno’s at a reduced rent while itself continuing to pay full rent.
Only one tenant, a Starbucks, retained possession at the stated rent.
        {¶ 12} ●    As of the February 2006 hearing date, Weber Sisters was
“operating at a total loss.”
        {¶ 13} In 2005, Weber Sisters undertook an ultimately abortive attempt to
sell the property at issue. It received an offer of $3.9 million, but after the
purchaser’s appraisal indicated a value of only $3 to $3.2 million, the purchaser
backed out of the deal. At that point, Weber Sisters obtained a written appraisal
from Koenig and Associates that opined a value of $3,200,000 as of September
12, 2005.
        {¶ 14} When the school board filed its complaint for tax year 2004
seeking an increase from the auditor’s valuation of $2,680,000 to the May 2003



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sale price of $4,175,000, the BOR held a hearing at which Marrell’s testimony
and other evidence was presented. The BOR rejected the use of the sale price,
stating that the principals of Weber Sisters were “not necessarily knowledgeable
buyers” and “not familiar with the Franklin County commercial market.”
Additionally, the BOR noted a “significant loss of tenants in calendar year 2003”
and the owner’s subsequent inability to sell the property. Based on these findings,
the BOR embraced the value of $2,680,000 that had been assigned by the auditor
rather than using the sale price to value the property for tax years 2004 and 2005.
       {¶ 15} The BTA, acting largely on the basis of the record developed
before the BOR, found that Weber Sisters had “presented no competent or
probative evidence challenging the arm’s-length nature of the May 2003 sale.”
Worthington City Schools Bd. of Edn. v. Franklin Cty. Bd. of Revision (Nov. 12,
2008), BTA No. 2006-H-381, 2008 WL 4917852, at * 3; Worthington I at ¶ 14.
As for the recency of the sale, the BTA confined itself to stating in a footnote that
the sale eight months before the 2004 tax-lien date qualified as recent. Id. at *4,
fn. 3. Accordingly, the BTA adopted the $4,175,000 sale price as the value of the
property. Id. at *6.
       {¶ 16} Weber Sisters appealed to this court. In Worthington I, we found
that Weber Sisters had demonstrated no error in the BTA’s determination with
regard to its finding that the May 2003 sale was at arm’s length. Worthington I, ¶
30. But we held that under the circumstances, the BTA’s discussion of the issue
of recency was inadequate, and we remanded for an evaluation and determination
whether the May 2003 sale was recent in light of the entire record. Id. at ¶ 34.
       {¶ 17} On April 20, 2010, the BTA issued its decision on remand
upholding the use of the sale price as the value of the property. Weber Sisters has
appealed, and we now affirm.
                                     Analysis




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       {¶ 18} “ ‘The fair market value of property for tax purposes is a question
of fact, the determination of which is primarily within the province of the taxing
authorities, and this court will not disturb a decision of the Board of Tax Appeals
with respect to such valuation unless it affirmatively appears from the record that
such decision is unreasonable or unlawful.’ ”         EOP-BP Tower, L.L.C. v.
Cuyahoga Cty. Bd. of Revision, 106 Ohio St.3d 1, 2005-Ohio-3096, 829 N.E.2d
686, ¶ 17, quoting Cuyahoga Cty. Bd. of Revision v. Fodor (1968), 15 Ohio St.2d
52, 44 O.O.2d 30, 239 N.E.2d 25, syllabus. The BTA’s findings of fact are to be
affirmed if supported by reliable and probative evidence, and the BTA’s
determination of the credibility of witnesses and its weighing of the evidence are
subject to a highly deferential abuse-of-discretion review on appeal. Olentangy
Local Schools Bd. of Edn. v. Delaware Cty. Bd. of Revision, 125 Ohio St.3d 103,
2010-Ohio-1040, 926 N.E.2d 302, ¶ 15; Satullo v. Wilkins, 111 Ohio St.3d 399,
2006-Ohio-5856, 856 N.E.2d 954, ¶ 14, citing Am. Natl. Can Co. v. Tracy (1995),
72 Ohio St.3d 150, 152, 648 N.E.2d 483.
       {¶ 19} Moreover, “the uniform rule [in real property taxation] is that
property should be valued in accordance with an actual sale price where the
criteria of the recency and the arm’s-length character of the sale are satisfied.’ ”
Woda Ivy Glen Ltd. Partnership v. Fayette Cty. Bd. of Revision, 121 Ohio St.3d
175, 2009-Ohio-762, 902 N.E.2d 984, ¶ 21, quoting Cummins Property Servs.,
L.L.C. v. Franklin Cty. Bd. of Revision, 117 Ohio St.3d 516, 2008-Ohio-1473, 885
N.E.2d 222, ¶ 25.
       {¶ 20} At the outset, we address Weber Sisters’ contentions regarding the
burden of proof. As we stated in Worthington I, 124 Ohio St.3d 27, 2009-Ohio-
5932, 918 N.E.2d 972, the “troika of deed, conveyance-fee statement, and
purchase agreement formed an adequate basis for the BTA to find a recent arm’s-
length sale, subject to rebuttal by the Weber Sisters.” Id. at ¶ 28. As a result, on




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remand it was Weber Sisters’ burden to prove that the May 2003 sale did not
qualify as a recent one with respect to the 2004 and 2005 tax-lien dates.
         {¶ 21} In Worthington I, we stated that “if the evidence that Weber Sisters
presented to the BOR did tend to negate recency, then the school board acquired
the burden of rebutting the probative force of that evidence.” (Emphasis added.)
Id. at ¶ 33. On remand, the BTA found no such evidence. Specifically, the BTA
stated that the record contained no evidence of any change in the market between
the May 2003 purchase and the January 1, 2004 tax-lien date. Worthington City
Schools Bd. of Edn. v. Franklin Cty. Bd. of Revision (Apr. 20, 2010), BTA No.
2006-V-381, at 9. Given that the burden lay on Weber Sisters to show the
existence of market change (or other factor negating recency of the sale), the
absence of evidence means that Weber Sisters has failed to prove the sale was not
recent.1
         {¶ 22} As evidence of market change, Weber Sisters points to the tenancy
problems that plagued the property through 2003, 2004, and 2005, and to the
difficulty selling the property in 2005. In a proper case, a loss of tenants that
results in reduced occupancy could constitute evidence of a declining market for
commercial space that would reduce the value of the property. But the mere fact
that tenants depart and are not replaced does not establish a change in market
conditions, because increased vacancies may result from a number of factors,
                                                                      2
including the current owner’s management practices.                       See Olentangy Local

1. In its BTA brief in Worthington I, Weber Sisters mentioned not only change in market, but
“change in the property” as a reason to find that a sale price should not be used. Such changes
include improvements that may increase the property’s value or casualty that may decrease the
property’s value, as well as changes in zoning or other regulatory restrictions. See Cummins
Property Servs., L.L.C. v. Franklin Cty. Bd. of Revision, 117 Ohio St.3d 516, 2008-Ohio-1473,
885 N.E.2d 222, ¶ 35. But aside from the completion of construction during 2003 discussed in
Worthington I at ¶ 20, the record shows no change in the property, and Weber Sisters has never
argued that the completion of construction made the sale price an unreliable indicator of value.

2. As for the relevance of a loss of tenants to the arm’s-length character of the sale, the BTA’s
earlier decision stated that Weber Sisters’ “lack of knowledge of the local market,” its “inability to




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Schools Bd. of Edn. v. Delaware Cty. Bd. of Revision (Jan. 13, 2009), BTA No.
2006-H-1361, 2009 WL 110177, at *4 (“While the subject may have experienced
increased vacancies during 2004, the information before us is inadequate to tie
any occupancy rate to a change in the market, since other factors, such as
management practices, may also impact a vacancy rate”), affirmed, 125 Ohio
St.3d 103, 2010-Ohio-1040, 926 N.E.2d 302; accord Higbee Co. v. Cuyahoga
Cty. Bd. of Revision, 107 Ohio St.3d 325, 2006-Ohio-2, 839 N.E.2d 385, ¶ 44
(failure to meet sales targets does not necessarily justify reducing the value of
retail property given that “the merchant’s business practices may also influence
sales”). Moreover, as for the 2005 appraisal, the BTA found that because the
appraisal report “fails to express an opinion of value for any tax lien date at issue
and its author was not present at hearing before the BOR to testify as to his expert
opinion,” the BTA was “unable to rely upon the appraiser’s conclusions.” 2010
WL 1652970, at *5. Given the record, the BTA could reasonably and lawfully
conclude that Weber Sisters failed to show a change in the market between May
2003 and the tax-lien dates for 2004 and 2005.
        {¶ 23} Weber Sisters argues that the BTA “completely ignored the
instructions of this court” and “ignored its own findings of fact and those of the
Court.” Even a cursory reading of the 12-page BTA decision shows that neither



resell the [property] based on the September 2005 appraised value,” and “the [property’s] loss of
tenants after the 2003 purchase” did “not rebut the arm’s-length nature of the sale.” Worthington
City Schools Bd. of Edn. (Nov. 12, 2008), BTA No. 2006-H-381, 2008 WL 4917852, at *3. On
appeal, we noted that “Weber Sisters has not pointed to any distinctly legal error in the BTA’s
discussion of the arm’s-length character” of the transaction. Worthington I, 124 Ohio St.3d 27,
2009-Ohio-5932, 918 N.E.2d 972, ¶ 30. In particular, Weber Sisters has never specifically argued
to the BTA or to the court that the buyer’s lack of knowledge is relevant to the arm’s-length
character of the transaction. See Appraisal Institute, The Appraisal of Real Estate (13th Ed.2008),
23 (“market value” usually predicated on buyer and seller acting “knowledgably”); Ohio
Adm.Code 5703-25-05(A)(1) and (2) (defining “true value” in terms of various factors, including
the parties’ “having a knowledge of all the relevant facts”). Jurisdictional and prudential grounds
typically prevent us from addressing substantive arguments that the appellant has not advanced
and, in any event, we regard any consideration of the arm’s-length character of the sale as




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is true. To the contrary: the BTA discussed the evidence, quoted Weber Sisters’
brief on the subject of recency, and made its finding based on what Weber Sisters
had argued. It thereby fulfilled the instruction of the court.
                                         Conclusion
        {¶ 24} For the reasons set forth, the decision of the BTA is reasonable and
lawful. We therefore affirm it.
                                                                          Decision affirmed.
        O’CONNOR, C.J., and O’DONNELL, LANZINGER, CUPP, and MCGEE
BROWN, JJ., concur.
        PFEIFER and LUNDBERG STRATTON, JJ., dissent.
                                  __________________
        PFEIFER, J., dissenting.
        {¶ 25} The court in this case places undue reliance on a speculative
possibility while ignoring a harsh economic reality.                 The court is unduly
impressed with the possibility that the difficulties encountered by Weber Sisters
may be its “management practices.” At the same time, the court accords little
value to evidence that “[i]mmediately after the May 2003 sale it became clear that
two tenants slated to occupy the largest portions of the building — Boston Market
and Fiesta Fresh — would not take possession.” I am willing to believe that this
problem had more to do with market weakness than with Weber Sisters’
management practices. Weber Sisters has presented enough evidence for us to
conclude that there has been a change in the market. The property is virtually
empty; it doesn’t make sense to value it as if it were fully leased. I would reverse
the decision of the BTA and reinstate the sound conclusion of the BOR. I dissent.
        LUNDBERG STRATTON, J., concurs in the foregoing opinion.
                                  __________________

foreclosed at this juncture by the law-of-the-case doctrine. Colonial Village Ltd. v. Washington
Cty. Bd. of Revision, 123 Ohio St.3d 268, 2009-Ohio-4975, 915 N.E.2d 1196, ¶ 12–13.




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       Rich & Gillis Law Group, L.L.C., Mark A. Gillis, Jeffrey A. Rich, and
Alison J. Crites, for appellee Worthington City Schools Board of Education.
       Wayne E. Petkovic, for appellant.
                           ______________________




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