Kilkenny, Sullivan and Leonard. The opinion of the court was delivered by Kilkenny, J.A.D.
The Director of the State Division of Taxation compiled a "Table of Equalized Valuations," pursuant to N.J.S.A. 54:1-35.1, which showed that as of October 1, 1963 the ratio between the sales prices paid for real estate sold in the City of Bayonne and the assessed valuation of that real estate was 36.20%. The table was prepared for school aid purposes.
Bayonne challenged the correctness of the ratio before the State Division of Tax Appeals, particularly claiming prejudice in the exclusion by the Director of two sales of real estate. One was a sale by Samuel Feldman and Rose Feldman, his wife, to Eldorado Terminals Corporation, by deed recorded on April 23, 1963. At the hearing before the State Division, the Director conceded that this sale should not have been excluded from consideration and modified the table accordingly. We are not concerned herein with the correctness of that modification.
The other sale, with which we are concerned, was a conveyance of 13.0551 acres from Humble Oil & Refining Company to Hunt Foods and Industries, Inc., for a price of $70,000, by deed dated July 9, 1962 and recorded August 24, 1962. Since this sale occurred beyond June 30, 1962, it was
not considered by the Director in preparing the 1962 tax equalization table, but was considered in computing the table for 1963. This sale was declared by the Director to be nonusable because the parcel sold was only a part of a much larger tract of land, had not been separately assessed, and constituted a so-called "split-off" which, under the Director's rules, made the sale nonusable.
There had been improvements on this 13-acre tract, but they had been demolished prior to the conveyance to Hunt Foods in 1962, so that the land was vacant and unimproved at the time of the conveyance. Humble owned 325 acres more or less, in addition to the parcel sold, which were adjacent to this parcel bought by Hunt Foods. Until January 8, 1963, when an apportionment was made of Humble's holdings to show the separation of the 13.0551 acres sold to Hunt Foods, the Bayonne tax list showed that the subject property was not separately assessed, but was included as part of a single assessment against the entire Humble tract.
Bayonne contended before the State Division, and the proofs support this contention, that the Humble tract had been assessed for many years as a unit on the tax list of Bayonne, but there was a firmly established policy, because of litigation and negotiation between the city and Humble, by which the land in this area was assessed at $25,000 an acre if it lay south of the Central Railroad tracks, and at $20,000 an acre if it lay north of the tracks. This valuation persisted after the sale to Hunt Foods, so that after the apportionment of the 13.0551-acre tract, it was separately assessed at $261,100, being $20,000 an acre, because this parcel was north of the railroad tracks. Humble's tax assessment on the remainder of the property retained by it was then reduced by the same amount.
The State Division of Tax Appeals ruled on January 10, 1964 that the sale of the 13.0551-acre parcel was a usable sale in preparing the table of equalized valuations and belonged in classification number I, set up by the Director, as a sale of "vacant land."
The Director of the Division of Taxation appealed from that part of the determination of the Division of Tax Appeals, which held that the sale from Humble to Hunt Foods was a usable sale in the preparation of the "Table of Equalized Valuations." Bayonne cross-appealed from that part of the Division's decision, which classified the sale as one involving vacant land.
On March 24, 1964 the Hudson County Board of Taxation, in computing the percentage of Bayonne's contribution to the cost of the county government, adopted, over the city's objection, the Director's table, as revised by the Division of Tax Appeals. Thereupon, Bayonne appealed to the Division of Tax Appeals this ruling by the county tax board, claiming that there was an erroneous classification of the sale under the Director's classification No. I as one of vacant land. The city contended that the 13.0551 acres sold had been used for heavy industrial purposes prior to the demolition of the structures thereon and sale to Hunt Foods, the property was zoned for a heavy industrial use, and, therefore, should have been treated as a sale of industrial property under classification No. IV. Bayonne maintains that such an erroneous classification would substantially increase its contribution to the cost of the county government to the extent of approximately $435,446 for the fiscal year 1964.
The Division of Tax Appeals, in deciding Bayonne's appeal from the ruling of the Hudson County Board of Taxation, reaffirmed the position taken by it in reviewing the propriety of the Director's table, that the Humble sale to Hunt Foods was a sale of vacant land and not industrial property, as claimed by the city. Thereupon, Bayonne filed a separate appeal from this further judgment of the Division of Tax Appeals.
Because common questions of law and fact are involved, the Director's appeal and the city's cross-appeal in that action, as well as the city's appeal from the Division's determination as to the action of the Hudson County Board of Taxation, were ordered consolidated and were argued at the same time. Accordingly,
we treat the issues as jointly applicable to ...