        IN THE COURT OF APPEALS OF THE STATE OF MISSISSIPPI

                              NO. 2017-CA-00574-COA

TNHYIF REIV GOLF LLC                                                    APPELLANT

v.

FORREST COUNTY, MISSISSIPPI                                               APPELLEE

DATE OF JUDGMENT:                        04/03/2017
TRIAL JUDGE:                             HON. JON MARK WEATHERS
COURT FROM WHICH APPEALED:               FORREST COUNTY CIRCUIT COURT
ATTORNEYS FOR APPELLANT:                 MICHAEL J. BENTLEY
                                         SIMON T. BAILEY
ATTORNEY FOR APPELLEE:                   DAVID B. MILLER
NATURE OF THE CASE:                      CIVIL - OTHER
DISPOSITION:                             REVERSED AND RENDERED: 11/06/2018
MOTION FOR REHEARING FILED:
MANDATE ISSUED:

      EN BANC.

      GRIFFIS, P.J., FOR THE COURT:

¶1.   TNHYIF REIV GOLF LLC (True North) appeals the circuit court’s entry of summary

judgment in favor of Forrest County regarding the County’s tax assessments of a student-

housing complex for tax years 2014, 2015, and 2016. We reverse and render.

                       FACTS AND PROCEDURAL HISTORY

¶2.   True North owns the Boardwalk at Dewberry Landing (Dewberry), a 150-unit student-

housing complex located in Hattiesburg. The Dewberry operates as an offsite college

dormitory for students attending the University of Southern Mississippi and Pearl River

Community College.

¶3.   In 2014, the County appraised the Dewberry at $13,230,640. It then assessed the
Dewberry at 15% of this appraised value, yielding an assessed value of $1,984,597 that,

when multiplied by the total millage of .17349, resulted in a total tax liability of $344,307.73.

¶4.    In 2015, the County appraised the Dewberry at $13,757,980. It then assessed the

Dewberry at 15% of this appraised value, yielding an assessed value of $2,063,698 that,

when multiplied by the total millage of .17758, resulted in a total tax liability of $366,471.48.

¶5.    In 2016, the County appraised the Dewberry at $13,784,110. It then assessed the

Dewberry at 15% of this appraised value, yielding an assessed value of $2,067,617 that,

when multiplied by the total millage of .18041, resulted in a total tax liability of $373,018.80.

¶6.    True North objected to the County’s tax assessments each year. However, the Board

of Supervisors rejected each objection and gave its final approval to the Forrest County tax

rolls for the applicable tax years. The tax rolls were submitted to and approved by the

Mississippi Department of Revenue.

¶7.    True North filed a timely appeal of the decisions of the Board of Supervisors to the

Forrest County Circuit Court, which consolidated the appeals.

¶8.    True North and the County filed cross-motions for summary judgment on the issue

of the true value of the Dewberry. True North claimed that the true value of the Dewberry

was $6,700,000, based on the property’s actual data and income. The County claimed that

“[t]he challenged assessments [we]re properly based on the subject property’s income as

modeled with reference to typical market properties.” Both parties relied on the testimony

and analysis of their respective expert appraisers: Tracy Wofford for True North and Bruce

Templeton for the County.



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¶9.    After a hearing, the circuit court issued a memorandum opinion and found “that the

law allow[ed] the County tax assessor to use market[-]typical properties for valuation.” The

circuit court concluded that “the County’s assessments of the Dewberry for tax years 2014,

2015[,] and 2016 reflect the true value of the Dewberry.” As a result, the circuit court

entered a judgment that granted the County’s motion for summary judgment and denied True

North’s motion for summary judgment. It is from this judgment that True North now

appeals.

                               STANDARD OF REVIEW

¶10.   “[W]e review the circuit court’s decision to grant summary judgment de novo.”

Bennett v. Highland Park Apartments, LLC, 170 So. 3d 450, 452 (¶4) (Miss. 2015).

“[S]ummary judgment is proper only where there exists no genuine issue of material fact and

the moving party is entitled to a judgment as a matter of law.” Id. “Because the movant must

be entitled to a judgment as a matter of law, a summary-judgment motion is usually limited

to questions of law, which this Court reviews de novo.”1 Id.

                                       ANALYSIS

¶11.   “Taxation shall be uniform and equal throughout the State.” Miss. Const. Art. 4,

§ 112. “Property shall be assessed for taxes under general laws, and by uniform rules, and

in proportion to its true value . . . .” Id. Mississippi Code Annotated section 27-35-50(1)

(Rev. 2005) defines “[t]rue value” as “market value, cash value, actual cash value, proper

value and value for the purposes of appraisal for ad valorem taxation.” In ascertaining true

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        The parties agree that “[t]heir dispute over the true value of the [Dewberry] is a
question of law; there are no disputes of fact to be resolved by the Court.”

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value, the county tax assessor shall consider the income capitalization approach, the cost

approach, and the market data approach.2 Miss. Code Ann. § 27-35-50(2). “For differing

types of categories of property, differing approaches may be appropriate.” Id. “The choice

of the particular valuation approach or approaches to be used should be made by the assessor

upon a consideration of the category or nature of the property, the approaches to value for

which the highest quality data is available, and the current use of the property.” Id.

¶12.   Here, the County offered a valuation of the Dewberry based on the modified cost

approach, while True North offered a valuation based on the income capitalization approach.

Interestingly, both parties agree that the cost approach was not the best approach to use. In

fact, the County conceded that the income capitalization approach, used by True North, is

appropriate for an income-producing property such as the Dewberry and is the method for

which the most data is available. Yet, despite this concession, the circuit court adopted the

County’s valuation based on the modified cost approach.

¶13.   When a taxpayer appeals a county’s ad valorem assessment of its property, the circuit

court must make a de novo determination of the property’s true value. Miss. Code Ann.

§ 11-51-77 (Rev. 2012) (providing that when a taxpayer appeals the assessment of taxes, the

“controversy shall be tried anew in the circuit court”). Here, the record reflects that the

circuit court deferred to the County’s valuation since the circuit court was “not convinced the

County acted outside of the Constitutional mandate, or violated a statute, in using market

typical property in its analysis.” However, such deference to the County’s appraisal is not



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           The market data approach is also referred to as the sales comparison approach.

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permitted when an individual taxpayer takes a de novo appeal challenging the assessment of

the property.

¶14.   In such an appeal, “it [i]s not the duty of the [court] to expressly find either for the

City or the taxpayer;” instead, the circuit court’s role is “to determine the taxable value of the

property” at issue in the appeal. Lavecchia v. Mayor & Alderman of Vicksburg, 20 So. 2d

831, 833 (Miss. 1945). Thus, the issue is not whether the County’s valuation techniques

were permissible simply because they did not violate a particular constitutional or statutory

provision. Instead, the issue is to determine the true value of the Dewberry. In other words,

as noted by True North, “the stage is cleared[,] and both parties—the taxpayer and the

county—must present evidence to support their proposed fair market value.”

¶15.   True North offered Wofford as its expert appraiser. Wofford relied primarily on the

income capitalization approach, but also considered the sales comparison approach. Both

approaches confirmed that $6.7 million was an appropriate true value for the Dewberry.

Importantly, in reaching the true value, Wofford considered and used the Dewberry’s

individual characteristics and actual income.

¶16.   The County offered Templeton as its expert appraiser. Templeton acknowledged that

Wofford’s “appraisal practice [wa]s fine,” but disagreed with her use of actual income.

While Templeton agreed there were differences in the various similarly-situated student-

housing properties, including operating expenses, vacancy rates, and gross income, he opined

that the Dewberry’s actual income should not be used unless it is typical to the market.

Because Templeton found that the Dewberry’s actual data (i.e., expenses, vacancy rates, and



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income) was not market typical, he did not consider it in his valuation of the property.

Instead, Templeton used modeled, market typical data to ascertain the property’s true value.

¶17.   Miss. Code Ann. § 27-35-50(3) calls for the valuation of individual properties, not for

the valuation of a hypothetical property that represents the “typical” characteristics of all

properties in the same class.3 Indeed, “[o]ur public assessors are directed to consider certain

specific factors affecting value of subject property and are then told to consider ‘any other

circumstances that tend to affect its value.’” Rebelwood, Ltd. v. Hinds County, 544 So. 2d

1356, 1363 (Miss. 1989) (quoting Miss. Code Ann. § 27-35-50(3)), superseded on other

grounds by statute as stated in Willow Bend Estates LLC and Woodyard Gardens LLC v.

Humphreys Cty. Bd. of Supervisors, 166 So. 3d 494, 498-99 (¶¶13-15) (Miss. 2013). After

all, a willing buyer would not pay the same price for all properties in the same class,

irrespective of their individual characteristics, nor would a willing seller accept the same

price for every property without regard for its individual characteristics. In other words, not

all properties in the same class face identical circumstances that would tend to affect value.

Accordingly, the individual property characteristics, including actual income, must be

included in any reasoned determination of fair market value. We find the circuit court erred

in disregarding the Dewberry’s individual characteristics.

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         Specifically, section 27-35-50(3) states that in determining the true value of
property, factors to be taken into consideration are:

       the proximity to navigation; to a highway; to a railroad; to a city, town, village
       or road; and any other circumstances that tend to affect its value, and not what
       it might bring at a forced sale but what the owner would be willing to accept
       and would expect to receive for it if he were disposed to sell it to another able
       and willing to buy.

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                                       CONCLUSION

¶18.   We find the circuit court erroneously adopted the County’s true value determination

of the Dewberry based on an admittedly inappropriate approach. The record clearly indicated

that True North demonstrated that the County’s valuation was inadequate and overvalued the

Dewberry by roughly double its actual worth.

¶19.   Conversely, True North’s true value determination was based on the income

capitalization approach, which both parties agreed was the best approach for the property.

Moreover, True North’s valuation included the Dewberry’s individual property

characteristics and actual income, which we find should have been considered and used in

ascertaining the true value of the property.

¶20.   For these reasons, we find the circuit court erred in its true value determination of the

Dewberry and reverse and render judgment in favor of True North, ascertaining the true

value of the Dewberry to be $6,700,000.

¶21.   REVERSED AND RENDERED.

     LEE, C.J., IRVING, P.J., BARNES, CARLTON, FAIR, GREENLEE AND
WESTBROOKS, JJ., CONCUR. TINDELL, J., CONCURS IN PART AND
DISSENTS IN PART WITHOUT SEPARATE WRITTEN OPINION. WILSON, J.,
NOT PARTICIPATING.




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