The case doesn't say what year was being examined but wouldn't it have to be pre-MACRS if they're depreciating cabinets, benches and shelves over 15 years?  If it was in Tax Court in early 1989 I'm guessing a 1985 tax return?  It's slightly before my time but I think MACRS was invented with TRA-86.

The only thing I could find from IRS that mentions "Septic" is Pub 527 which lists it as a "Plumbing Improvement" in the table on page 5.  My inclination would be 27.5/39 year property.  I would have trouble making the argument that a Septic System "increases the value of the land".  IMO it increases the value of the building that's attached to it.

I'm not saying you're wrong, just that I couldn't find any good sources to support this as a land improvement.

Rick