On appeal from the Tax Court of New Jersey.
Before Judges Scalera and Keefe.
Plaintiff, Mort Jablin, appeals from a Tax Court decision to affirm real property tax assessments for the 1988 and 1989 tax years on his industrial property. Plaintiff argues on appeal that the Tax Court erred when it: (1) permitted the municipality's expert to testify, although the expert had not inspected the subject property; (2) failed to dismiss that expert's opinion as a net opinion; (3) rejected plaintiff's expert's inclusion of an ECRA reserve operating expense as part of his income calculations; and, (4) rejected that expert's "paired analysis" rental rates as part of his income calculations.
The trial was held before the Hon. John J. Hopkins, J.T.C., who issued a twelve-page letter opinion in which he affirmed the real property tax assessments for both tax years. We affirm substantially for the reasons stated by Judge Hopkins and add the following comments in further response to the issues raised by plaintiff.
In his appellate brief, plaintiff contends that the Tax Court judge erred when he permitted the municipality's appraisal expert to testify, and when he failed to dismiss that expert's opinion as a net opinion. Primarily, plaintiff argues that Mason, the municipality's expert, should not have been permitted to testify because he had not personally inspected the property at issue. In support of his argument, he maintains that the Uniform Standards of Professional Appraisal Practice require that a real property appraisal report must include a certification specifying that the signator had personally inspected the property. Here, the appraisal report was signed by both Mason and Kirk, a staff appraiser in Mason's office. However, only Kirk certified that he had personally inspected the subject property.
Additionally, plaintiff offers further support for his contention by pointing out that a person is precluded from testifying before a county board of taxation regarding an assessment unless he has inspected the property at issue. N.J.A.C. 18:12A-1.9(k). However, that regulation only applies to matters before a county board of assessment and is not applicable to matters before the Tax Court. Although plaintiff cites F.M.C. Stores Co. v. Boro. of Morris Plains, 195 N.J. Super. 373, 383, 479 A.2d 435 (App. Div. 1984), aff'd, 100 N.J. 418, 431, 495 A.2d 1313 (1985), in support of his contention, that case merely held that the choice of forum as between the county board of taxation and the Tax Court should not affect the substantial rights of the parties.
Mason candidly admitted that, although he had not inspected the interior of the subject building, he had inspected the site and was familiar with and had reviewed the data gathered by Kirk. Thus, Mason did not mislead the court regarding his inspection of the property and had sufficiently reviewed the data gathered by Kirk in order to offer an informed appraisal opinion.
Judge Hopkins found, relying on Evid. R. 56(2), that Mason was permitted to rely upon "facts or data . . . made known to him at or before the hearing." The judge also found that Evid. R. 56(2) supplemented N.J.S.A. 2A:83-1. That statute permits a witness in any Tax Court proceeding to testify regarding information of comparable land sales obtained from the owner, seller, purchaser, lessee, or occupant of such property or the broker or attorney who "negotiated . . . or [was] cognizant of such sales. . ." See, N.J. Sports & Exposition Auth. v. Cariddi, 84 N.J. 102, 105-06, 417 A.2d 529 (1980). The judge's conclusion that Mason was qualified to testify was a sound interpretation of the rule. We agree with the tax judge's view that the issue really speaks to the weight to be accorded Mason's testimony as opposed to its admissibility.
Moreover, we reject plaintiff's assertion that Mason's testimony amounted to nothing more than a net opinion, and, for that reason, that it should have been rejected by the Tax Court. A net opinion is one that is unsupported by factual evidence and is based only upon an expert's bare conclusions. Buckelew v. Grossbard, 87 N.J. 512, 524, 435 A.2d 1150 (1981). Here, contrary to plaintiff's contention that Mason was "hardly familiar with any of his so-called comparable data," Mason plainly documented his opinion and was well versed in the information upon which his opinion was based.
Plaintiff also maintains that Judge Hopkins erred when he rejected plaintiff's expert's inclusion of an ECRA reserve as an operating expense in his income approach calculations, and his paired rental analysis to assign different rental rates to the first and second-floor industrial spaces of the subject property.
It is recognized that judges presiding in the Tax Court have special expertise, and for that reason, their findings will not be disturbed unless they are plainly arbitrary or there is a lack of substantial evidence to support them. Southbridge Park, Inc. v. Borough of Fort Lee, 201 N.J. Super. 91, 94, 492 A.2d 1026 (App. Div. 1985); accord, Glenpointe Assoc. v. Tp. of Teaneck, 241 N.J. Super. 37, 46, 574 A.2d 459 (App. Div. 1990), certif. denied, 122 N.J. 391 (1990); see, N.J.S.A. 2A:3A-13 (judges of the Tax Court shall be chosen for their special qualifications, knowledge and experience in matters of taxation). However, although the Tax Court is charged with applying its own judgment to valuation data submitted by experts in order to determine a property's true value, its right to make such an independent assessment is not "boundless". Its determination must be based on the evidence before it and the data at its disposal. F.M.C. Stores Co. v. Bor. of Morris Plains, supra, 100 N.J. at 430. The scope of appellate review of the Tax Court's decision is ...