SOUTHERN BELL TELEPHONE & T. CO. v. County of Dade
275 So. 2d 4 (1973)
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Rule of Law:
A taxpayer may use professionally conducted assessment-sales ratio studies to provide prima facie evidence of the general level of property assessment in a jurisdiction, thereby proving a claim of discriminatory over-assessment.
Facts:
- For the 1967 tax year, Southern Bell Telephone and Telegraph Company's tangible personal property in Dade County was assessed at its full market value.
- Southern Bell alleged that the Dade County tax assessor systematically assessed real property at a lower percentage, approximately 80% of its market value.
- To support its claim, Southern Bell commissioned an assessment-sales ratio study by experts Weil and Ekeblad, which analyzed 2,845 arm's-length property sales.
- This study used sales prices inferred from documentary stamps on recorded deeds and concluded that the median assessment level for real property was 81.37% of its market value.
- Southern Bell presented a second study based on sales data from the Keyes Company, a large real estate firm, which showed a median assessment ratio of 82.01%.
- A third study by the U.S. Bureau of Census for non-farm residential properties showed a median ratio of 83.2%.
- Southern Bell also argued its personal property was assessed at a higher level than other businesses' personal property due to differing accounting regulations but could not prove the extent to which other businesses utilized more favorable accounting options.
Procedural Posture:
- Southern Bell Telephone and Telegraph Company filed a lawsuit in the Florida Circuit Court against Dade County, seeking relief from its 1967 tangible personal property tax assessment.
- The trial court (Circuit Court) denied Southern Bell's requested relief.
- Southern Bell, as appellant, appealed the decision to the District Court of Appeal, Third District.
- The District Court of Appeal affirmed the trial court's judgment, siding with Dade County, the appellee.
- Southern Bell, as petitioner, sought a writ of certiorari from the Supreme Court of Florida, which was granted.
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Issue:
Do professionally conducted assessment-sales ratio studies, which use sales prices derived from documentary stamps as evidence of market value, constitute a valid method for a taxpayer to prove that their property was assessed at a substantially higher percentage of its value than other properties in the county?
Opinions:
Majority - Per Curiam
Yes. A taxpayer is entitled to a practical means of obtaining relief from discriminatory taxation, and professionally conducted assessment-sales ratio studies are a reliable method to establish the general level of assessment. The price at which property is sold is prima facie evidence of its market value, and documentary stamps are prima facie evidence of that price. While an individual sale price is not conclusive, a large number of sales in a statistical study provides a highly dependable overall result. Denying relief because other taxpayers are also not assessed uniformly would immunize the assessor's discriminatory conduct and deprive the taxpayer of any effective remedy, violating the principle of equal taxation.
Dissenting - Ervin, J.
No. The majority uses an improper yardstick by allowing sales ratio statistics of real property transactions to determine whether there was discriminatory overassessment of tangible personal property. The valuation factors for real property under statute are different from those for tangible personal property, making the comparison inapplicable and the resulting conclusion flawed. The majority improperly substituted its own evidentiary findings for those of the trial and appellate courts, which should have been upheld.
Analysis:
This decision is significant for establishing the validity of statistical evidence, specifically assessment-sales ratio studies, in property tax litigation. It provides taxpayers with a practical and scientifically accepted method to prove systemic under-assessment of other properties, which is crucial for equal protection claims in taxation. The ruling lowers the evidentiary burden for taxpayers, who no longer need to prove the value and assessment of a vast number of individual properties. This precedent empowers taxpayers to challenge discriminatory assessment schemes by relying on accepted statistical methodologies to demonstrate a lack of uniformity.
