[Cite as OM Harikrushn, L.L.C. v. Summit Cty. Bd. of Revision, 2017-Ohio-1028.]


STATE OF OHIO                    )                        IN THE COURT OF APPEALS
                                 )ss:                     NINTH JUDICIAL DISTRICT
COUNTY OF SUMMIT                 )

OM HARIKRUSHN, LLC                                        C.A. No.         28234

        Appellant

        v.                                                APPEAL FROM JUDGMENT
                                                          ENTERED IN THE
COUNTY OF SUMMIT BOARD OF                                 COURT OF COMMON PLEAS
REVISION, et al.                                          COUNTY OF SUMMIT, OHIO
                                                          CASE No.   CV 2015-09-4616
        Appellees

                                DECISION AND JOURNAL ENTRY

Dated: March 22, 2017



        HENSAL, Presiding Judge.

        {¶1}    OM Harikrushn, LLC appeals from the judgment of the Summit County Court of

Common Pleas, which affirmed the Summit County Board of Revision’s valuation of certain

commercial property. For the reasons that follow, this Court reverses and remands the matter for

further proceedings consistent with this decision.

                                                     I.

        {¶2}    This case stems from a tax appeal relating to the valuation of certain commercial

property being used to operate a hotel. Relevant to this appeal, the Lorain National Bank filed a

foreclosure action relating to the property in April 2012, and moved to appoint a receiver. The

receiver took possession and control of the property a few months later. The Summit County

Court of Common Pleas granted a decree of foreclosure in May 2013, and ordered the property

to be sold at a Sheriff’s sale. The Summit County Sheriff obtained an appraisal of the property

in August 2013, which valued it at $2,700,000.00.
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       {¶3}    The Sheriff’s sale took place in February 2014 with a minimum requested bid of

$1,800,000.00. OM Harikrushn, LLC (“OMH”) made the minimum bid, and purchased the

property for same. OMH obtained its own appraisal in June 2014, which valued the property at

$1,840,000.00, with $100,000.00 of that amount being allocated as personal property.

       {¶4}    The Summit County Fiscal Officer valued the property at $2,647,300.00 during

the 2014 tax year. OMH filed a complaint with the Summit County Board of Revision (the

“Board”), seeking to have that value reduced to $1,840,000.00. At the hearing before the Board,

OMH orally moved to amend that figure to $1,740,000.00. It then presented testimony from its

agent/representative and submitted a copy of the appraisal it procured, among other evidence.

No evidence was presented at the hearing in support of the county’s valuation.

       {¶5}    The Board ultimately determined that a change in valuation was not warranted

and, thus, the valuation remained at $2,647,300.00. OMH appealed that decision to the Summit

County Court of Common Pleas, which deemed the matter submitted upon the record, the

evidence submitted, and the briefing of the parties.      The trial court affirmed the Board’s

valuation. OMH now appeals, raising two assignments of error for our review.

                                               II.

                                 ASSIGNMENT OF ERROR I

       THE LOWER COURT ERRED WHEN IT MADE A SWEEPING REJECTION
       OF THE REAL PROPERTY APPRAISAL, MR. LAVANI’S TESTIMONY
       AND THE RECEIVER’S AGGRESSIVE MARKETING HISTORY AND
       COMPREHENSIVE FINAL REPORT.

       {¶6}    In its first assignment of error, OMH argues, in part, that the trial court erred

when it rejected the appraisal it offered as evidence. In response, the appellee, the Revere Local

School District Board of Education (“Board of Education”), argues that the trial court did not err

by rejecting the appraisal because it did not contain the proper tax-lien date, and because the
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appraisal amounted to hearsay since its author did not testify at the hearing. The Board of

Education, however, did not object to the appraisal on the basis of hearsay at the hearing before

the Board. At most, it was simply noted that the appraiser was not present to answer questions.

We, therefore, need not address any argument with respect to hearsay, as the Board of Education

forfeited that issue on appeal. Emerson v. Erie Cty. Bd. of Revision, Slip Opinion No. 2017-

Ohio-865, ¶ 16 (declining to address the county’s argument that an appraisal was “inadmissible

hearsay” because the county did not raise a hearsay objection in the proceedings below).

       {¶7}    We will begin our analysis by addressing our standard of review and the

applicable law. This Court reviews a trial court’s decision from a tax appeal for an abuse of

discretion. Black v. Bd. of Revision of Cuyahoga Cty., 16 Ohio St.3d 11 (1985), paragraph one

of the syllabus. An abuse of discretion implies that the trial court’s attitude was unreasonable,

arbitrary, or unconscionable. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219 (1983).

       {¶8}    As the Ohio Supreme Court has stated, “the party challenging the board of

revision’s decision * * * has the burden of proof to establish its proposed value as the value of

the property.” Colonial Village Ltd. v. Washington Cty. Bd. of Revision, 123 Ohio St.3d 268,

2009-Ohio-4975, ¶ 23. Conversely, “the board of revision (or auditor) bears no burden to offer

proof of the accuracy of the appraisal on which the county initially relies, with the result that the

BTA [i.e., the board of tax appeals] [or court] is justified in retaining the county’s valuation of

the property when an appellant fails to sustain its burden of proof at the BTA [or court].” Id.

       {¶9}    A narrow exception to these general principles applies, however, when “the

developed record before the BTA [or court] affirmatively negate[s] the validity of the county’s

valuation of the property.” Id. at ¶ 24. In this regard, “when the evidence presented to the board

of revision or the BTA [or court] contradicts the auditor’s determination in whole or in part, and
                                                   4


when no evidence has been adduced to support the auditor’s valuation, the BTA [or court] may

not simply revert to the auditor’s determination.”         Dayton-Montgomery Cty. Port Auth. v.

Montgomery Cty. Bd. of Revision, 113 Ohio St.3d 281, 2007-Ohio-1948, ¶ 27. Instead, this

“trigger[s] the legal duty of the BTA [or court] to determine whether the record as developed by

the parties contained sufficient evidence to permit an independent valuation of the property.”

Colonial Village at ¶ 25.

       {¶10} Here, no evidence was adduced in support of the county’s valuation. The trial

court acknowledged this, stating that “[t]he Appellees presented no testimony at [the] hearing to

support the claim that the value of the property should be maintained at the current value.”

OMH, on the other hand, presented testimony from its agent/representative and submitted the

appraisal it procured, among other evidence, in support of its position.

       {¶11} In affirming the Board’s decision, the trial court noted that “[t]he record is devoid

of any indication of how the [Board] arrived at that figure [i.e., $2,647,300.00].” It then made

two pertinent findings: (1) the appraisal offered by OMH was not competent evidence as to the

value of the property because it bore the date of May 29, 2014, not the relevant tax-lien date of

January 1, 2014;1 and (2) the sale price could not be used as evidence of the property’s value

because OMH did not overcome the presumption that the sale was a forced sale. We will

address the former finding first, as it is dispositive for purposes of this appeal.

       {¶12} Revised Code Section 5715.19(D) provides that the determination for a complaint

against the valuation of real property “shall relate back to the date when the lien for taxes or

recoupment charges for the current year attached[,]” which is the first day of January. R.C.

323.11. Thus, as the Ohio Supreme Court has stated, “the first day of January of the tax year in


       1
           The trial court also noted that the appraisal contained valuations for multiple dates.
                                                   5


question is the crucial valuation date for tax assessment purposes.” Freshwater v. Belmont Cty.

Bd. of Revision, 80 Ohio St.3d 26, 29-30 (1997).

        {¶13} In Freshwater v. Belmont County Board of Revision, the appellant offered two

appraisals, neither of which bore the proper tax-lien date. Id. at 30. The Court explained that

“[t]he essence of an assessment is that it fixes the value based upon facts as they exist at a certain

point in time[,]” and that “[t]he real estate market may rise, fall, or stay constant between any

two dates[.]” Id. It, therefore, determined that the BTA did not err by rejecting the appraisals

because “[e]vidence of the valuation as of th[o]se two dates [wa]s not evidence of the valuation

as of [the tax-lien date].” As explained below, however, the Ohio Supreme Court has also

indicated that an appraisal that does not bear the proper tax-lien date is not necessarily rendered

incompetent for all purposes.

        {¶14} In Copley-Fairlawn City School District Board of Education v. Summit County

Board of Revision, the Ohio Supreme Court addressed a situation wherein an appraisal bore the

date of June 14, 2011, yet the relevant tax-lien date was January 1, 2012. 147 Ohio St.3d 503,

2016-Ohio-1485, ¶ 2. At the proceedings below, the BTA determined, in part, that the appraisal

was not competent evidence because it valued the property as of six months prior to the tax-lien

date. Id. It, therefore, reinstated the auditor’s initial valuation. Id.

        {¶15} On appeal, the Ohio Supreme Court reversed the BTA’s decision. Id. at ¶ 32. In

doing so, the Court stated that “the attempt to use the opinion of value expressed in [an] appraisal

report as an opinion of value for a different date does not render the appraisal incompetent as

evidence for any purpose at all.” (Emphasis added.) Id. at ¶ 22. The Court went on to

determine that “the analysis of sale and rent comparables in the appraisal report [was] usable for

purposes of determining the property’s 2012 valuation[.]” Id. at ¶ 25.
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       {¶16} In reaching the above conclusion, the Ohio Supreme Court cited its prior decision

in AP Hotels of Illinois, Inc. v. Franklin County Board of Revision, which addressed a similar

situation wherein an appraisal did not bear the appropriate tax-lien date. 118 Ohio St.3d 343,

2008-Ohio-2565, ¶ 16. There, the Court noted that “[t]o rely on the appraisal report [for January

1, 2003] as constituting an expert opinion of value for the 2002 tax year would constitute error.”

Id. at ¶ 13. Notwithstanding, the Court determined that the appraisal contained pertinent factual

information, including an extensive discussion regarding comparable sales, the property’s

income and expenses, and the nature of the motel market during the relevant time. Id. ¶ 16. It

concluded that “[a]lthough the appraiser did not certify his ultimate opinion of value as of the * *

* tax lien date, his certification that the ‘statements of fact contained in this report are true and

accurate’ did permit the BTA to use the factual information set forth in the report.” Id.

       {¶17} Here, the trial court discussed the information contained in the appraisal, but

determined that the appraisal’s failure to contain the appropriate tax-lien date rendered it

incompetent for purposes of establishing the value of the property. Its order contains no analysis

as to whether the appraisal – while incompetent as to the value of the property – otherwise

contained competent evidence that negated the county’s valuation. Additionally, aside from

determining that OMH could not use the sale price of the property as evidence of value, the trial

court’s order similarly does not indicate whether other evidence in the record negated the

county’s valuation in whole or in part. If it did, then the trial court had no authority to simply

affirm to the county’s valuation, and was instead required to determine whether the record

contained sufficient evidence to permit an independent valuation of the property. Dayton-

Montgomery Cty. Port Auth., 113 Ohio St.3d 281, 2007-Ohio-1948, at ¶ 27; Colonial Village

Ltd., 123 Ohio St.3d 268, 2009-Ohio-4975, at ¶ 25. This Court will not make that determination
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(i.e., whether the appraisal and/or other evidence in the record negated the county’s valuation in

whole or in part) in the first instance. Skidmore v. Natl. Bronze & Metals (Ohio), Inc., 9th Dist.

Lorain No. 12CA010328, 2014-Ohio-4423, ¶ 16 (“this Court generally will not decide issues in

the first instance[.]”). Accordingly, OMH’s first assignment of error is sustained.

                                 ASSIGNMENT OF ERROR II

       THE LOWER COURT FAILED TO RECOGNIZE THAT THE EVIDENCE
       BEFORE THE BOR AND THE LOWER COURT NEGATED THE VALIDITY
       OF THE AUDITOR’S VALUATION.

       {¶18} In light of this Court’s resolution of the preceding assignment of error, we decline

to address OMH’s second assignment of error.

                                                {¶19} III.

       {¶20} OM Harikrushn, LLC’s first assignment of error is sustained. We decline to

address OM Harikrushn, LLC’s second assignment of error. The judgment of the Summit

County Court of Common Pleas is reversed, and the cause is remanded for further proceedings

consistent with this decision.

                                                                              Judgment reversed,
                                                                             and cause remanded.




       There were reasonable grounds for this appeal.

       We order that a special mandate issue out of this Court, directing the Court of Common

Pleas, County of Summit, State of Ohio, to carry this judgment into execution. A certified copy

of this journal entry shall constitute the mandate, pursuant to App.R. 27.

       Immediately upon the filing hereof, this document shall constitute the journal entry of

judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the
                                                8


period for review shall begin to run. App.R. 22(C). The Clerk of the Court of Appeals is

instructed to mail a notice of entry of this judgment to the parties and to make a notation of the

mailing in the docket, pursuant to App.R. 30.

       Costs taxed to Appellees.




                                                    JENNIFER HENSAL
                                                    FOR THE COURT



SCHAFER, J.
CALLAHAN, J.
CONCUR.


APPEARANCES:

THOMAS A. SKIDMORE, Attorney at Law, for Appellant.

SEAN KORAN, Attorney at Law, for Appellee.

SHERRI BEVAN WALSH, Prosecuting Attorney, and TIMOTHY J. WALSH, Assistant
Prosecuting Attorney, for Appellees.
