What standard of assessment is to be applied?
The Supreme Court of the Russian Federation has indicated that an appraiser shall not apply a Federal standard of assessment #4 for determination of market price.
Closed joint stock company "I." appealed to the Cadastral chamber on the establishment of cadastral value of the property equal to its market value as of 01.01.13. According to the plaintiff, the cadastral value of the property is almost three times higher than the market. He enclosed the report of an independent appraiser to the suit that received a positive expert opinion of the SRO of appraisers.
The courts of three instances dismissed the claim, indicating the report of an independent appraiser to be unreliable. The appraiser has not applied during the preparation of the report the Federal valuation standard "Definition of cadastral value" (FVS No. 4), approved by the order of Ministry of economic development dated 22.10.10 No. 508.
The Supreme court sent the case back for retrial. The lower courts hadn’t considered that "cadastral and market values are different values". The plaintiff had requested the establishment of cadastral value in the amount of market value. The appraiser, following the task, had determined market value and not the cadastral value. He was guided by the Law No. 135-FZ, FSO № 1, 2 and 3.
FSO No. 4 contains requirements for the determination of cadastral value of real estate obtained by the methods of mass appraisal and without considering the unique characteristics of a particular property. Therefore, it is applicable when determining the cadastral value of the property and is optional when establishing a market value.
The Supreme court also referred to paragraph 11 of the resolution of Plenum of the Russian Federation dated 30.06.15. № 28 "On some questions arising by consideration by courts of cases on challenging the results of cadastral valuation of real estate". According to the explanation there is a need to attach to the application of definition of market value the following documents:
– report on the date of determination of cadastral value;
– prepared expert opinion.
The plaintiff has complied with those requirements.