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R value for the design of braced frame in a plywood shear wall building

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Hi,
 
Should I be using R of 4.4 for an X- braced frame at the first story and for all of the plywood shear walls in the direction of the braced frame including the ply shear wall above the braced frame?
 
I originally used R=5.6 (item 2.4.a of table 16N of the UBC) because braces are not designed to support gravity loads.  The plan checker commented that the use of R=4.4 is appropriate per item 1.4.a because this is a bearing wall building.  In fact I believe that this is a dual system building where part of it is a bearing wall and other part is a building frame system (steel columns and beams at the line where the brace frame occurs).
 
Any thoughts?
 
Regards,

Alexander (Sasha) Itsekson, SE
Enginious Structures
Oakland, CA
tel. 510.601.1646
fax  510.420.8110