Various Issues of Interest

Various Issues of Interest

Relevant time for comparable sales • What is the relevant time frame for comparable sales?

Relevant time for comparable sales • What is the relevant time frame for comparable sales? • Generally accepted that for 2019 tax year, would be October 1, 2017 through October 1, 2018.

Relevant time for comparable sales • What is the relevant time frame for comparable sales? • Generally accepted that for 2019 tax year, would be October 1, 2017 through October 1, 2018. • However, this is a general rule of thumb, and not set in stone.

Relevant time for comparable sales • What is the relevant time frame for comparable sales? • Generally accepted that for 2019 tax year, would be October 1, 2017 through October 1, 2018. • However, this is a general rule of thumb, and not set in stone. • Question is more nuanced, involving remoteness and relevancy of the sale.

Relevant time for comparable sales • What is the relevant time frame for comparable sales? • Generally accepted that for 2019 tax year, would be October 1, 2017 through October 1, 2018. • However, this is a general rule of thumb, and not set in stone. • Question is more nuanced, involving remoteness and relevancy of the sale. • Glen Wall Assoc. v. Wall Twp., 99 N.J. 265 (1985)

Glen Wall Associates v. Wall Twp., 99 N.J. 265, 283, (1985) “Implicit in our holding that a sale of the subject property be considered as an indicator of market value is the requirement that the sale be not remote. The benefit of the comparison is lost if the effects of time have altered the factors which result in a determination of value. Our courts have considered the issue of remoteness. See Rek Investment Co. v. Newark, supra, 80 N.J.Super. at 560, 194 A.2d 368 (sale of subject property 2 months after assessment date “entitled to great weight”); Samuel Hird & Sons, Inc., supra, 87 N.J.Super. at 70-71, 208 A.2d 153 (sale 8 ½ months after assessing date considered); Almax Builders, Inc. v. Perth Amboy, supra, 1 N.J.Tax at 37 (sale 7 months after assessing date “admitted for its rational probative valuation inference”). Accordingly, we hold that the court should have considered the sale of the property, less than three months after the assessment date, as an indicator of value.”

Reliability of Comparable Sales • Considerations when determining whether comparable sale is reliable:

Reliability of Comparable Sales • Considerations when determining whether comparable sale is reliable: • Whether the buyer or the seller were unusually motivated

Reliability of Comparable Sales Considerations when determining whether comparable sale is reliable: • Whether the buyer or the seller were unusually motivated • Whether the buyer and seller were well-advised and acting prudently

Reliability of Comparable Sales Considerations when determining whether comparable sale is reliable: • Whether the buyer or the seller were unusually motivated • Whether the buyer and seller were well-advised and acting prudently • The length of time that the property was exposed to an open and competitive marketplace

Reliability of Comparable Sales Considerations when determining whether comparable sale is reliable: • Whether the buyer or the seller were unusually motivated • Whether the buyer and seller were well-advised and acting prudently • The length of time that the property was exposed to an open and competitive marketplace • Whether the purchase price was paid in cash

Reliability of Comparable Sales Considerations when determining whether comparable sale is reliable: • Whether the buyer or the seller were unusually motivated • Whether the buyer and seller were well-advised and acting prudently • The length of time that the property was exposed to an open and competitive marketplace • Whether the purchase price was paid in cash • Whether the purchase price was affected by special or creative financing

Reliability of Comparable Sales Considerations when determining whether comparable sale is reliable: • Whether the buyer or the seller were unusually motivated • Whether the buyer and seller were well-advised and acting prudently • The length of time that the property was exposed to an open and competitive marketplace • Whether the purchase price was paid in cash • Whether the purchase price was affected by special or creative financing • VBV Realty, LLC v. Scotch Plains Twp., 29 N.J.Tax 548, 562 (2017)

Hearsay • “A statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.” N.J.R.E. 801(c).

Hearsay • “A statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.” N.J.R.E. 801(c). • “Hearsay is not admissible except as provided by [the New Jersey rules of evidence] or by other law.” N.J.R.E. 802.

Hearsay • “A statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.” N.J.R.E. 801(c). • “Hearsay is not admissible except as provided by [the New Jersey rules of evidence] or by other law.” N.J.R.E. 802. • But in tax court, we regularly permit hearsay testimony. Why?

Hearsay • “A statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.” N.J.R.E. 801(c). • “Hearsay is not admissible except as provided by [the New Jersey rules of evidence] or by other law.” N.J.R.E. 802. • But in tax court, we regularly permit hearsay testimony. Why? • 2 reasons: One by rule, one by statute

Hearsay • Small claims cases.

Hearsay • Small claims cases. • N.J.R.E. 101 - Scope, Definitions; (a) Applicability; exceptions:

Hearsay • Small claims cases. • N.J.R.E. 101 - Scope, Definitions; (a) Applicability; exceptions: • 101(a)(2) Court proceedings; relaxation - [T]hese rules may be relaxed in the following instances to admit relevant and trustworthy evidence in the interest of justice:

Hearsay • Small claims cases. • N.J.R.E. 101 - Scope, Definitions; (a) Applicability; exceptions: • 101(a)(2) Court proceedings; relaxation - [T]hese rules may be relaxed in the following instances to admit relevant and trustworthy evidence in the interest of justice: • 101(a)(2)(A) actions within the cognizance of the Small Claims Section of the Special Civil Part of the Superior Court . . . and the Small Claims Division of the Tax Court . . . .

Hearsay • N.J.S.A. 2A:83-1 Value of real estate

Hearsay • N.J.S.A. 2A:83-1 Value of real estate • In any action or proceeding for the acquisition or sale of land . . . or on review of the assessment for taxes of any real property, or in any action or proceeding in the Tax Court, any person offered as a witness in any such action or proceeding shall be competent to testify as to sales of comparable land, including any improvements thereon . . . from information or knowledge of such sales, obtained from the owner, seller, purchaser, lessee or occupant of such comparable land, or from information obtained from the broker or brokers or attorney or attorneys who negotiated or who are familiar with or cognizant of such sales, which testimony when so offered, shall be competent and admissible evidence in any such action or proceeding.

Hearsay • N.J.S.A. 2A:83-1 Value of real estate • In any action or proceeding for the acquisition or sale of land . . . or on review of the assessment for taxes of any real property, or in any action or proceeding in the Tax Court, any person offered as a witness in any such action or proceeding shall be competent to testify as to sales of comparable land, including any improvements thereon . . . from information or knowledge of such sales, obtained from the owner, seller, purchaser, lessee or occupant of such comparable land, or from information obtained from the broker or brokers or attorney or attorneys who negotiated or who are familiar with or cognizant of such sales, which testimony when so offered, shall be competent and admissible evidence in any such action or proceeding. • This statute essentially abolishes the hearsay rule for testimony of valuation expert. NJ Sports & Exposition Auth. v. Cariddi, 84 N.J. 102 (1980).

Hearsay • But, this creates an issue - what if the information relied upon by the expert is incorrect?

Hearsay • But, this creates an issue - what if the information relied upon by the expert is incorrect? • How can the Assessor, Appraiser, or Attorney for the Municipality make that determination, and present it to the Court (or County Board)?

Hearsay • But, this creates an issue - what if the information relied upon by the expert is incorrect? • How can the Assessor, Appraiser, or Attorney for the Municipality make that determination, and present it to the Court (or County Board)? • Inconsistencies in the report itself; Inconsistencies between discovery and other documents or information available to the Municipality - Income and Expense Information, Certifications of Rent in Rent Stabilized or Rent Controlled Municipalities.

Deeds • Every form County Board of Taxation Petition requires listing the Book and Page number for the deeds of all comparables.

Deeds • Every form County Board of Taxation Petition requires listing the Book and Page number for the deeds of all comparables. • Tax Court - R. 8:6-1(b)(2): A party intending to rely upon sales . . . of comparable properties shall furnish each opposing party with a list of comparable sales . . . which list shall set forth as to each sale . . . [the] book and page number of the recording of the deed . . . .

Deeds • Every form County Board of Taxation Petition requires listing the Book and Page number for the deeds of all comparables. • Tax Court - R. 8:6-1(b)(2): A party intending to rely upon sales . . . of comparable properties shall furnish each opposing party with a list of comparable sales . . . which list shall set forth as to each sale . . . [the] book and page number of the recording of the deed . . . . • Allows direct indication of where opposing party can find confirmation of the sale through the actual deed.

Deeds • N.J.S.A. 2A:83-1: In any action or proceeding in the Tax Court, the realty transfer fee, if any, paid upon the recording of any deed or other instrument of conveyance as well as the consideration or sales price stated therein or in the affidavit of consideration attached to and filed with any such deed or instrument shall be admitted as prima facie evidence of the true consideration or sales price of the said property.

Payment of Taxes • 2 separate statutes with technical differences govern the requirement for payment of taxes in order to proceed with a tax appeal.

Payment of Taxes • 2 separate statutes with technical differences govern the requirement for payment of taxes in order to proceed with a tax appeal. • Appeal to the Tax Court from a judgment from the County Board - no ability to “cure”

Payment of Taxes • 2 separate statutes with technical differences govern the requirement for payment of taxes in order to proceed with a tax appeal. • Appeal to the Tax Court from a judgment from the County Board - no ability to “cure” • Direct appeals to the Tax Court or County Board - petitioner has ability to “cure”

Payment of Taxes • N.J.S.A. 54:51A-1(b) At the time that a complaint has been filed with the Tax Court seeking review of judgment of county tax boards, all taxes or any installments thereof then due and payable for the year for which review is sought must have been paid.Notwithstanding the foregoing, the Tax Court may relax the tax payment requirement and fix such terms of payments as the interests of justice may require.

Payment of Taxes • Exception for “interests of justice”:

Payment of Taxes • Exception for “interests of justice”: • Beyond the control of the property owner and not self-imposed

Payment of Taxes • Exception for “interests of justice”: • Beyond the control of the property owner and not self-imposed • Unattributed to poor judgment ,a bad investment or failed business venture, and

Payment of Taxes • Exception for “interests of justice”: • Beyond the control of the property owner and not self-imposed • Unattributed to poor judgment ,a bad investment or failed business venture, and • Reasonably unforeseeable.

Payment of Taxes • N.J.S.A. 54:3-27 (appeals of > $1M)

Payment of Taxes • N.J.S.A. 54:3-27 (appeals of > $1M) • A taxpayer who shall file an appeal from an assessment against him shall pay to the collector of the taxing district no less than the total of all taxes and municipal charges due, up to and including the first quarter of the taxes and municipal charges assessed against him for the current tax year in the manner prescribed in R.S.54:4-66

Payment of Taxes • N.J.S.A. 54:3-27 (appeals of > $1M) • A taxpayer who shall file an appeal from an assessment against him shall pay to the collector of the taxing district no less than the total of all taxes and municipal charges due, up to and including the first quarter of the taxes and municipal charges assessed against him for the current tax year in the manner prescribed in R.S.54:4-66. • Choice to appeal directly to Tax Court, or with the County Board.

Payment of Taxes • N.J.S.A. 54:3-27 (appeals of > $1M) • A taxpayer who shall file an appeal from an assessment against him shall pay to the collector of the taxing district no less than the total of all taxes and municipal charges due, up to and including the first quarter of the taxes and municipal charges assessed against him for the current tax year in the manner prescribed in R.S.54:4-66. • Choice to appeal directly to Tax Court, or with the County Board. • Since statute is silent as to when to pay, County Board or Tax Court still have jurisdiction to hear the appeal.

Payment of Taxes • N.J.S.A. 54:3-27 (appeals of > $1M) • A taxpayer who shall file an appeal from an assessment against him shall pay to the collector of the taxing district no less than the total of all taxes and municipal charges due, up to and including the first quarter of the taxes and municipal charges assessed against him for the current tax year in the manner prescribed in R.S.54:4-66. • Choice to appeal directly to Tax Court, or with the County Board. • Since statute is silent as to when to pay, County Board or Tax Court still have jurisdiction to hear the appeal. • Municipality must make motion to dismiss for failure to pay taxes, taxpayer must pay before motion is heard, or will be dismissed with prejudice.

Chapter 91 Motions • R. 8:7(e) - Chapter 91 motions must be filed within 180 days of the filing of the complaint - NOT within 180 days of the deadline for filing of the complaint.

Various Issues of Interest