J.C. PENNEY CORPORATION et al. v. TOWN OF MANCHESTER, SC 18141

Judicial District of New Britain

     Taxation; Whether the Plaintiff was Aggrieved for Purposes of Bringing Tax Appeal; Whether the Failure to File a Timely Declaration of Personal Property Precludes the Plaintiff from Challenging the Assessor's Valuation; Whether the Modified Cost Approach is an Appropriate Method for Valuing Personal Property.  General Statutes § 12-41 (d) requires that all persons in a town file "a declaration of personal property" on or before the "first day of November. . . . "   The plaintiff corporation, before filing a declaration on November 1, 2005, obtained permission from the Manchester tax assessor to file an amended declaration regarding its warehouse assets.  On December 5, 2005, the plaintiff filed its amended declaration in which it indicated that it was unsure about what personal property was present at the warehouse, that many of the assets at the warehouse were worth far less than reported, that it was intending to conduct an inventory in the next two to three months and that it was reserving all of its rights for appealing the assessor's decision.  On June 30, 2006, the plaintiff completed its inventory of the warehouse assets and valued them at $1,219,000 as of October 1, 2005.  For the grand list of October 1, 2005, however, the tax assessor valued the warehouse property at $21,114,786.  The town's board of assessment appeals upheld the tax assessor's valuation, and the plaintiff appealed to the Superior Court.  The court observed that although plaintiff had a statutory obligation to advise the town by November 1, 2005, of all the taxable personal property in its possession, it failed to do so until almost eight months after the reporting deadline.  Thereafter, relying on Xerox Corp. v. Board of Tax Review, 240 Conn. 192 (1997), it denied the plaintiff's appeal, ruling that the plaintiff, having failed to comply with the statutes pertaining to the annual valuation of personal property, as well as acting contrary to the understanding it had with the assessor regarding the filing of the declaration and the amended declaration, was in no position to contest the valuation placed on its personal property.  Although this ruling was dispositive, the court nevertheless addressed and rejected the plaintiff's argument that the assessor improperly used a mass appraisal process to value its property that did not comply with General Statutes § 12-63 (a), which, according to the plaintiff, requires that the valuation be based on market value.  The court ruled that the assessor's modified cost approach, which takes into consideration the actual cost of the assets and the depreciation value, implicates the cost approach that is universally accepted as a reliable method of valuation.  Subsequently, in an articulation of its decision, the trial court, citing United Technologies Corp. v. East Windsor, 262 Conn. 11, 22-23 (2002), concluded that, given its rejection of the plaintiff's appraiser's late and indecisive valuation - which ranged between $1,219,000 and $10,778,000 - for the subject property, the plaintiff failed to prove that the assessor had overvalued its property and, therefore, was not aggrieved for purposes of bringing this tax appeal.  The plaintiff challenges the trial court's decision in this appeal.