specially concurring:
In rejecting the valuations of the Board, the circuit court, under the motion pursuant to section 12(3) of the Administrative Review Act (Ill. Rev. Stat, ch. 110, .§ 275(3)), made findings in respect to the eleven items of personalty substantially as follows:
(1) that the applicable statutory and case law requires that valuations for assessment be made on the basis of fair cash market value;
(2) that evidence adduced against taxpayer from the Jacobs Company, through Mr. Miller, constituted opinions of value based upon a rigidly applied and arbitrary formula wholly unrelated to the condition, situation, obsolescence, inherent usefulness, or marketability of each specific item of equipment and which measured the value of each by its assumed contribution to use in taxpayer’s operation by a method of “trending” its original acquisition cost in place (i.e., including transportation and installation costs) to current 1970 dollars and substracting for depreciation on the basis of “effective age” which is always less than calendar age because it arbitrarily assumes constant renovation and replacement to keep the item in operating order and gives no consideration to the actual fact as to functional obsolescence or need of repairs;
(3) that such appraisal testimony of Jacobs Company did not purport to represent “fair cash value” of the property in the classic sense of that phrase in terms of the amount a willing buyer would pay a willing seller;
(4) that where there was considerable evidence in the record from other witnesses, including American Appraisal Company, of opinions of value based upon consideration of factors peculiar and relevant to the specific machinery and equipment in question, and as to “fair market value in the traditional sense,” the Property Tax Appeal Board erred in accepting completely and exclusively the opinion testimony of Jacobs Company, Inc., only, and in rejecting consideration of and in giving no weight whatever-to all other testimony;
(5) the result is that the valuations found by the Property Tax Appeal Board do not reflect “fair cash value” of the personal property in the traditional sense established by the cases and are contrary to the manifest weight of the evidence and the law.
At another place in the memorandum opinion, the circuit court stated that the court does not say that the Jacobs Company testimony was wholly wrong but only that the Board erred in accepting all of it to the exclusion of all other evidence.
In explaining the "value in use” approach applied exclusively by the Property Tax Appeal Board to all items of personalty, Mr. Miller of Jacobs Company testified that the concept does not purport to represent the price a willing buyer would pay a willing seller; it ignores completely all considerations of functional obsolescence or changes in technology, and arbitrarily assumes the value of each piece of equipment to be its original acquisition cost in place (i.e., including any transportation and erection costs), “trended” to current dollars, from which there is then subtracted some arbitrary allowance for “effective age.” “Effective age,” he explained, is always less than calendar age because it is always assumed, arbitrarily, by this formula, that the equipment has been kept renovated and in full repair “because prudent management would do that,” and that no matter how aged, or in what foreign country the item was originally and exclusively made, that parts are readily available so that value would not be adversely affected in that respect,— again “because prudent management in making a determination (albeit, many years ago) to buy a foreign piece of equipment (in Germany, for example, where one of plaintiffs wheels was acquired) would have anticipated the need for parts and made arrangements to get them when and where necessary.” The “value in use” approach also excludes consideration of what a comparable machine would sell for on the market, or availability on the market, or resale value, since this is considered always less than value on the site in use, in the pit, erected and operating.
In Illinois, personal property is to be assessed according to “fair cash value” (Ill. Rev. Stat., ch. 120, §502) which has been interpreted to mean “fair market value,” or the price each specific item would bring at a sale where both parties are willing, ready and able to do business and are under no duress to do so. (People ex rel. Rhodes v. Turk, 391 Ill. 424, 63 N.E.2d 334 (1945).) In State of Illinois v. Illinois Central R.R. Co., 27 Ill. 64, 68 (1861), however, the supreme court stated of this standard that:
“Where property has a known and determinate value ascertained by commerce in it, as in most kinds of personal property, or fixed by law as money, there can be no difficulty [in fixing valuation]. But there are many kinds of property, as to which the. assessor has no such satisfactory guide. Such is peculiarly the case with railroad property, and other similar property, constructed not only for the profit of the owners, but for the accommodation of the public, under the sanction and by the exercise of the sovereign power of the State. In such cases, the inquiry should be, what is the property worth to be used for the purposes for which it is constructed, and not for any other purpose to which it might be applied or converted, or for which it might be used. In such cases, if the property is devoted to the use for which it was designed, and is [in fact] in a condition to produce its maximum income, one very important element for ascertaining its present value is discovered, and that is its net profits.” (Emphasis added.)
In People ex rel. Wangelin v. St. Louis Bridge Co., 357 Ill. 245, 191 N.E. 300 (1934), the property in question was a privately owned Illinois portion of the Eads bridge across the Mississippi River at East St. Louis. Again in this instance, the supreme court observed that a bridge (like the railroad in the preceding case) is a type of property in a class by itself (i.e., sui generis), in the sense that as a completed structure and unit, there is practically no market by which fair cash value can be ascertained so that testimony as to reproduction costs and earnings could both be considered in determining value. More recently, in Chicago & North Western Ry. Co. v. Department of Revenue, 6 Ill.2d 278, 128 N.E.2d 722 (1955), the supreme court said that capitalization of earnings and reproduction costs depreciated are factors which may be considered in determitiing fair cash value of railroad properties for assessment purposes, but it stated also that such evidence is properly considered in such cases, not because of its intrinsic reliability, but out of necessity, and that in the case of ordinary property, the income which a particular owner is able to realize from such property is not relevant in determining value for tax assessment purposes. In so holding, it made specific reference to methods of valuation applied in eminent domain proceedings to ascertain market value, citing Forest Preserve District v. Hahn, 341 Ill. 599, 173 N.E. 763 (1930). In that case, it was emphasized that “market value” does not mean value to the owner, but value on the market for its highest and best use, unless the property is of such special nature and applied to such special use (i.e., is sui generis or unique), that it is shown to have no market value.
As to the latter kinds of unique or special properties, it is said at 72 Am. Jur. 2d State and Local Taxation §756, (1974), that reproduction costs, while not a final test, are or may be a criteria of present value when allowances are made for depreciation and obsolescence, but that valuation being a quasi-judicial function, the exercise of judgment is required so that any arbitrary valuation of property made without taking into consideration the actual facts and circumstances of each piece of property (at least where practicable) is void. At section 753 of the same volume at page 79, it is stated:
“Actual value has been defined by statute as the value of property in the market in the ordinary course of trade °
And later, in the same place, it is said of real property what also appears true of personal property:
“[It] seems * * * the general practice, * * * where there is no satisfactory evidence of market value, * * * to admit all reasonable evidence throwing light on the true value, including testimony and data to show particular modes of arriving at valuation, and to give such weight to the same as the trier of facts in the exercise of a reasonable discretion finds proper under the circumstances.”
In an annotation at 152 A.L.R. 611, 613 (1944), the author in summarizing the cases, writes:
“If property assessed has a market value and there is satisfactory evidence as to what its value is, other evidence of value may become at best merely corroborative. But if the property has no market value special means of measuring its true value must of necessity be relied on.
* * * The proposition that a court or referee has discretion as to the mode of arriving at true value apparently means no more than that greatest weight, and sometimes controlling weight, should be given to that mode which under the circumstances of the case appears most reasonable and sound, and that, the question being one of fact, the choice made is not to be overthrown on review, except in case of an abuse of discretion or a departure from the statutes.” (Emphasis added.)
I conclude from these authorities that where, because of the special or unique nature of the property, no market exists so that many elements bearing upon value are authorized, out of mere necessity, to be considered, they may nonetheless be used only as aids in arriving at “fair cash value” in the traditional sense contemplated by the statute. That no one of these other authorized approaches to valuation may ever be accorded conclusive validity to the exclusion of other available evidence so as to establish a new and different standard of valuation. I conclude also from these authorities that even in the case of ordinary property for which evidence of market value may exist, that other approaches to valuation may still be considered as aids in corroboration of “fair cash value,” again in the traditional sense contemplated by the statute, but not for the different purpose of creating a new standard of “value in use to the owner.”
There was considerable evidence in the record here in respect to all or most of the 11 items of personalty as to the fair cash value of each in the traditional sense, including opinion evidence as to what a willing buyer would pay a willing seller for each, and the specific condition of repair and obsolescence of each. Without passing any judgment as to whether any of it v/as more or less satisfactory evidence, or the weight that should be given any of it, it must at the same time be noted that the record is devoid of proof that the six shovels, three wheels, and two drag lines are constructed as a composite unit like a bridge, or in any manner sui generis, or special, merely because they are located and operating in plaintiff’s pit. Where there was evidence of market value, and nothing unique shown in respect to the items, the Board might properly consider elements of the Jacobs Company’s appraisal, such as opinions of reproduction costs, as a means of corroborating the validity of other opinion testimony as to market value, in order to make a considered judgment of time fair cash value according to the statutory standard.
The fact that the circuit court did not find the Jacobs Company’s appraisal testimony to be wholly incompetent proof, did not preclude that court, as the Board argues, from validly making the further determination that tire Board manifestly erred in adopting Jacobs Company’s valuations to the exclusion of all other evidence. The circuit court’s determination is legally consistent and correct. The record here shows that the Board did not use the Jacobs Company formula and testimony for purposes of arriving at valuation according to the statutory standard. Instead the record shows that the Board excluded consideration of all evidence of value related to the statutory standard and abandoned inquiiy as to value under that standard altogether. It substituted exclusively, in lieu thereof, the entire Jacobs Company formula, which is based on many arbitrary assumptions, to arrive at “value in use to the owner in the pit.” For this reason, I agree with the determination of the circuit court and the majority of this court, that the valuations of the Board must be reversed. I agree that the circuit court erred in making its own independent valuations and that the cause must be remanded to the Property Tax Appeal Board to make proper valuations consistent with the law.