APPEALS from a judgment of the Superior Court of Los Angeles County. James R. Dunn, Judge. Affirmed. (Los Angeles County Super. Ct. No. BS110800).
The opinion of the court was delivered by: Boren, P.J.
pub. order 12/3/09 (see end of opn.)
This appeal involves the efforts by plaintiff E. Randol Schoenberg to reduce the tax assessment of his residential real property. The issues concern the proper scope of a proceeding by defendant, the Assessment Appeals Board of Los Angeles County (the Appeals Board), and the required procedure for a taxpayer to obtain judicial review of a valuation determination by the Appeals Board.
We find that Schoenberg's claim that the Appeals Board failed to assess land and improvements separately is without factual foundation, as revealed by the Appeals Board's written decision denying his application. Also, Schoenberg had no authority to limit the jurisdiction of the Appeals Board to a reassessment of only the value of the land (a valuation he disputed). The Appeals Board was permitted on its own initiative to reassess the value of the improvements on the land (though Schoenberg and the assessor had previously agreed on a lower assessment figure for improvements). Such a total reappraisal was necessary to fulfill the Appeals Board's mandate to equalize property values. Finally, Schoenberg's exclusive remedy was not a petition for a writ of mandate against the Appeals Board, but rather a complaint seeking a refund of taxes-a remedy he belatedly pursued against a second defendant, the County of Los Angeles (the County), after it was barred by the statute of limitations.
FACTUAL AND PROCEDURAL SUMMARY
Between 2004 and 2005, Schoenberg built a single-family residence on land owned by his parents. His parents transferred the property to him in October of 2005, triggering a Proposition 13 reassessment because of the change in ownership. Ultimately, in light of the change in ownership the assessor reassessed the property's base year value to a total of $2,150,000, allocating $1,400,000 to the land and $750,000 to the improvements.
Schoenberg appealed to the Appeals Board and applied for a changed assessment, urging that the actual total value of the property was $1,750,000. Schoenberg's written application for a changed assessment complained that the "[b]ase year value for the change of ownership established on the date of October 6, 2005 is incorrect." Schoenberg's application to the Appeals Board contained his statement of opinion of value, which indicated that the difference of opinion was over the value of the land. In his application, Schoenberg valued the land at only $1,000,000, but agreed that the improvements were valued at $750,000.
At the outset of the equalization hearing before the Appeals Board, the appraiser from the assessor's office stated: "The assessor's recommendation, based, in part, on evidence presented by the applicant, and the applicant's witness, is a total value of $2,150,000, still. $1,040,000 allocated to the land and $1,110,000 allocated to the improvement." Schoenberg agreed with the land assessment of $1,040,000 (a $360,000 reduction), but argued that the assessment of improvements should remain unchanged at $750,000 because he had only appealed the assessment of land value.
On June 7, 2007, after witnesses and documentary evidence were presented at the equalization hearing, the Appeals Board denied Schoenberg's application for a reduction in the property's assessed value. The Appeals Board stated in its written decision, in pertinent part, that Schoenberg's estimate of $750,000 for improvements was "deficient because his value for the improvements failed to include the majority of indirect construction costs and entrepreneurial profit." The Appeals Board considered the total value of the property, land, and improvements-including the assessor's use of three recent comparable sales-and determined that the property's overall enrolled value was $2,165,000. As the Appeals Board explained, "The Applicant's opinion of land value of $1,040,000, along with an adjusted improvement value of $1,125,000, yields a total value of $2,165,000, which exceeds the existing assessment of $2,150,000. . . . [¶] . . . . [¶] The Board finds that when the Applicant's cost approach is properly adjusted to include all costs, it actually supports the existing assessment enrolled by the Assessor. Furthermore, the assessment is also well supported by the sales comparison approach submitted by the Assessor. Therefore, the Board hereby denies this Application."
On August 29, 2007, Schoenberg filed a petition for a writ of mandate (Code Civ. Proc., § 1085), with the Appeals Board designated as the defendant and the Los Angeles County Assessor as the real party in interest. In his petition, Schoenberg argued that he had accepted the enrolled value of the improvements on the property ($750,000), and that only the property's land value had been before the Appeals Board. Schoenberg further alleged that at the hearing before the Appeals Board the assessor had agreed with Schoenberg's contention regarding the value of the land, and that Schoenberg and the assessor had stipulated that the true value of the land was $1,040,000, not the enrolled value of $1,400,000. He thus sought to restrict review by the Appeals Board to only the value of the land, and to reduce the value of the land by $360,000.
On November 1, 2007, Schoenberg filed an amended petition for a writ of mandate, which added to the pleading a complaint for a refund of taxes. At an initial case management conference, the trial court issued an order to show cause as to why Schoenberg's mandate claim should not be struck. The court relied on Little v. Los Angeles County Assessment Appeals Bds. (2007) 155 Cal.App.4th 915, which explained in pertinent part that a tax refund action, rather than a mandate petition, is the exclusive remedy for challenging on the merits a property tax assessment. (Id. at pp. 922-926.) The court ruled that Schoenberg's petition for a writ of mandamus was not an available remedy.
Thereafter, the real party in interest, the Los Angeles County Assessor (the Assessor), filed an answer to Schoenberg's amended complaint for refund of taxes. On June 4, 2008, Schoenberg then filed a second amended petition for writ of mandate and complaint for refund of taxes. The pleading added the County as a second defendant.
The County demurred, challenging both the timeliness of the action and its viability on the merits. The trial court rejected the County's statute of limitations argument on the ground that it was barred by estoppel, but sustained the demurrer without leave to amend on the alternative ground that Schoenberg's second amended pleading failed to state a cause of action. The trial court reasoned, in pertinent part, that the requirement that the "[l]and and improvements shall be separately assessed" (Cal. Const., art. XIII, § 13) is in the context of an assessor's creation of an assessment roll for property tax purposes, while the Appeals Board is a board of equalization that reviews assessments to ensure they comply with the constitutional standard of "fair market value." (Cal. Const. art. XIII, § 1, subd. (a).) The court thus rejected Schoenberg's theory that he should be entitled to equalization of the land value, independent of a review of the value of the entire appraisal unit which would include the value of the improvements. The court sustained the demurrer without leave to amend and dismissed the action.
Schoenberg appeals, and the County cross-appeals urging that Schoenberg's belated tax refund action is barred ...