In Re Appeal of McLean Trucking Co.

Chief Justice Bobbitt

dissenting in part.

I dissent from that portion of the Court’s decision which holds that the valuations placed on McLean’s tractors and trailers by the State Board of Assessment were not supported by competent evidence.

*395The opinion states: “There was no competent evidence before the State Board of Assessment as to the ‘true value in money’ of the McLean trailers, except for testimony of Messrs. Harrison and Millikin, witnesses for McLean, each of whom valued McLean’s entire fleet of 2,918 trailers far below the book value thereof, which the board found to be the entire fleet’s true value in money.”

Elsewhere, the opinion states: “[W]e interpret [the statement of the Board of Assessment] concerning book value as a finding that such fair market value of the 635 tractors was $5,161,199. We hold that such finding is ‘unsupported by competent, material, and substantial evidence in view of the entire record as submitted.’ ” In the last sentence, the opinion was quoting G.S. 143-315(5), the general provision describing the various circumstances under which an administrative decision may be reversed.

These conclusions, standing alone, might indicate that the evidence of book value in this case was “incompetent” due to a failure in the manner of presentation. However, when considered in context, the term “incompetent” is used to mean legally impermissible. The reasoning of the opinion is this: McLean’s “book value” reflected substantial quantity discounts that McLean was able to get from time to time in the purchase of its tractors and trailers. Such discounts do not bear on what each individual tractor or trailer might sell for on the market. “[T]he principle of equality of appraisal which is fundamental in the Machinery Act” would require that each tractor and trailer be valued from the standpoint of what each item— each tractor and trailer — might sell for on the market. Therefore, the opinion concludes, book value is an improper test and the State Board may not even consider it.

Seemingly, this position puts this Court in the position of making appraisals and usurps the discretion of the duly constituted appraisal boards. Nowhere does it appear that the State Board held that McLean’s book value afforded the only proper evidence to be considered in determining the trucks’ true value in money. After considering several types of evidence, the State Board came to the conclusion that the book value more nearly approximated true value under the circumstances of this case.

*396Of course, book value is not necessarily an accurate indicator of true market value. If McLean’s discounts represented “bargains” which McLean would not have to pass on to another buyer, then book value, to the extent it recognized such “bargains,” would not have been properly relied upon. However, there is no evidence to indicate that a competitor of McLean who makes volume purchases from the manufacturers of tractors and trailers would be unable to obtain similar volume discounts.

McLean is not in the business of selling used tractors and trailers. As of January 1, 1970, McLean had a large inventory of tractors and trailers for use in its business. It was the function of the State Board to determine the market value of this inventory in its entirety on that date. Obviously, the willing buyers of large numbers of tractors and trailers would be limited; and any prospective buyer could reasonably expect a volume discount in its purchase of used tractors and trailers at least equal to the volume discount it could obtain in the purchase of new tractors and trailers. It is for the State Board of Assessment to exercise its judgment as to valuations based on the realities of each case.

In In re Block Co., 270 N.C. 765, 155 S.E. 2d 263 (1967), the Court approved the use of the Truck Blue Book in the assessment of the value of trucks (there, only six trucks). In Block, the Court found support for its approval for the use of the Truck Blue Book in Article 35A of Chapter 105 (Vol. 2D, Replacement 1965), entitled “Listing of Automobiles in Certain Counties,” and specifically in G.S. 105-428. Article 35A, according to G.S. 105-429 thereof, did apply to Guilford County (involved in Block) but not to Forsyth County (involved here). Article 35A has been repealed.

Since G.S. 105-429 authorized the use of the Truck Blue Book in Guilford County, the Court did not consider whether the Truck Blue Book would otherwise have been competent under “[t]he rules of evidence as applied in the superior and district court divisions of the General Court of Justice . ” G.S. 143-318(1). I share the view that the State Board of Assessment should be permitted to consider the Truck Blue Book along with other sources of information which competent appraisers would deem appropriate. Whether there was evidence sufficient to establish that the particular Blue Book *397here considered complies with “[t]he rules of evidence as applied in the superior and district court divisions of the General Court of Justice” is not presented on this appeal.

The valuation of McLean’s tractors and trailers for the purpose of taxation was a matter for determination by the State Board of Assessment. We are not to determine whether it should have reached a different conclusion. In my opinion, it did not overstep its authority or the limits of its discretion in the valuations it placed upon McLean’s tractors and trailers as of January 1, 1970.

Justice Sharp joins in this opinion.