J.A. Green Constr. Corp. v. Assessor of the City of New York, 56 N.Y.2d 370 (1982)
When statutory law is silent or has expired, common law principles dictate that State equalization rates are admissible as evidence in proceedings challenging property tax assessments, especially when the legislative history reveals a substantive differentiation based on economic impact.
Summary
J.A. Green Construction Corp. challenged the assessed valuation of its Brooklyn shopping center, claiming overvaluation and inequality compared to other properties. At trial, Green sought to introduce the State Board of Equalization and Assessment (SBEA) equalization rate to prove inequality. The City objected, citing a statute limiting admissible proof. The trial court initially deemed the amended statute unconstitutional and admitted the SBEA rate, ultimately reducing the assessments. The Appellate Division reversed, upholding the statute’s constitutionality and rejecting the SBEA rate. The Court of Appeals reversed the Appellate Division, holding that because the relevant statutes had expired, common law principles applied, under which the SBEA rates were admissible. The case was remitted to the Appellate Division to determine fair market value and proper assessments.
Facts
J.A. Green Construction Corp. owned a shopping center in Brooklyn and initiated a proceeding, along with several lessees, to challenge the property’s assessed valuation for tax years 1971-1972 through 1979-1980. The petitions claimed “overvaluation and inequality,” alleging the property was assessed at a higher rate than other properties in the borough. The challenge focused on whether the assessments were based on a proper valuation and whether the correct ratio between fair market value and assessed value was used.
Procedural History
The trial court initially found the amended version of Real Property Tax Law § 720(3) applicable but unconstitutional, allowing the State equalization rates as proof. It reduced the assessments based on those rates. The Appellate Division reversed, dismissing the petitions and sustaining the assessments, relying on its prior holding in Matter of Slewett & Farber v Board of Assessors of County of Nassau, which declared § 720(3) constitutional. The Court of Appeals reversed the Appellate Division’s order and remitted the case for further proceedings.
Issue(s)
Whether, in the absence of a controlling statute, state equalization rates are admissible as proof of unequal assessment in a proceeding challenging property tax assessments.
Holding
Yes, because when the relevant statutes have expired during the pendency of the appeal, common law principles apply, under which State equalization rates are proper proof of unequal assessment.
Court’s Reasoning
The Court of Appeals reasoned that because the amended statute (Real Property Tax Law § 720(3)) barring the use of equalization rates had expired during the appeal, it was no longer applicable. The court noted that the newly enacted version of § 720(3) was explicitly prospective and therefore also inapplicable. With no statutory guidance, the court turned to common law principles, citing Guth Realty v Gingold and 860 Executive Towers v Board of Assessors of County of Nassau. These cases established that State equalization rates are generally admissible as evidence. The court emphasized that the legislative history revealed a substantive differentiation between New York City/Nassau and the rest of the state, based on the economic impact of re-evaluation. The Court stated: “Though the kind of proof admissible to establish value is normally a procedural question to be determined by the law in effect at the time of trial…we think the history of legislation on this issue…so imbues this normally procedural issue with substantive effect that we should not apply the usual rule.” Because the Appellate Division had only ruled on the constitutionality of the statute, the Court remitted the case to that court to determine the fair market value of the property and calculate the proper assessments, based on the State equalization rates.