The Case of the Forbidden Expert

Most New Jersey tax appeals boil down to a classic battle of the experts. The taxpayer's appraiser squares off against the municipal appraiser, and the Tax Court decides who has the better part of the argument. While that's something of an oversimplification, it catches the essence of the trial. It also tends to some measure of predictability in the process, and facilitates settlement of many appeals. 

Still, there are cases that can't be settled for one reason or another. If that's the case, one of the most important decisions a tax appeal litigant will make is the choice of appraisal expert. If you hire someone unfamiliar with the dynamics of appraising for Tax Court or inexperienced as a testifying witness, you run the risk of putting your claim in serious jeopardy. Even if the assessment is patently wrong, the appraiser has to show it, and then go on to prove the true value of the real estate. 

What does all this have to do with the case recently decided by New Jersey's Appellate Division? Plenty. In VNO 1105 State Hwy 36, LLC %Stop & Shop v. Township of Hazlet, a property owner retained an expert who also happened to become the tax assessor for a nearby municipality. Shortly before the trial, the township moved to bar the taxpayer's expert on the grounds that tax assessors should be categorically barred from testifying in opposition to another tax assessor. The Tax Court agreed with the municipality and barred the expert from testifying.

The Appellate Division disagreed, and reversed the Tax Court's order. The appellate judge writing for the panel noted that there was no indication that there was any side-switching or breach of confidentiality that would require disqualifying the expert, and found that the public interest did not automatically require the disqualification of a sitting tax assessor from testifying as an expert on behalf of a taxpayer. 

This is definitely good news for taxpayers, because the number of truly capable appraisal experts well versed in New Jersey property taxation is small; and the loss of even one well known and respected appraiser to property owners is significant. Practically speaking as well, the outcome makes sense; absent some genuine breach of confidence, there is no real reason to bar such individuals from testifying for property owners in other municipalities.

The full opinion can be accessed at the Tax Court's website here.