UPDATE: For Updated Information, Click Here.
Like most areas of the law, court decisions and new legislation impact the rights of property owners as they navigate the tax appeal system. Among the more notable changes that occurred in the later part of 2012 which will have an impact on tax appeals filed for 2013 are the following:
- On January 17, 2013, the New Jersey Supreme Court ruled that naming the wrong plaintiff in a tax appeal complaint is not always a fatal flaw requiring the case to be dismissed. In Prime Accounting the property owner filed an appeal and attached the tax assessment card to the complaint (as required by the court rules). However, the tax assessment card had the wrong company listed as the property owner and when the tax complaint was filed, the name from the tax assessment card, not the current owner of the property, was identified as the plaintiff in the case. The tax court dismissed the complaint, and the Appellate Division affirmed the dismissal. When the case reached the New Jersey Supreme Court, the lower court decisions were reversed and the tax appeal was reinstated. In reviewing the facts, the New Jersey Supreme Court noted that the municipality was aware which property was under appeal since the tax card was attached to the complaint, and more important, the new owner asked to tax office to change the name of the owner on the tax records. As a result, the New Jersey Supreme Court held that the mistake did not deprive the Tax Court of subject-matter jurisdiction and the complaint could be amended to correct the mistake. In addition, the amendment would relate back to the original filing date. It is important to note that this case did not expand the definition of an "aggrieved taxpayer" or who has standing to appeal. Rather, the case makes it clear that certain types of errors can be corrected with relation back to the original filing date. To read the case, Click Here.
- On December 7, 2012, the Tax Court found that the dismissal of a tax appeal by the Morris County Tax Board fell short of providing the taxpayer with the “square deal” that the New Jersey legislature had hoped for. At the tax board hearing, the property owner’s appraiser testified based upon an appraisal that contained some boiler-plate language indicating that the report’s “intended use was for the lender/client to evaluate the property.” Despite the appearance by their appraiser and attorney, the Tax Board dismissed the appeal for lack of prosecution which, under New Jersey law, is a dismissal with prejudice. The Tax Court reversed the Tax Board noting that tax appeals are being dismissed for lack of prosecution far too often by local tax boards and the remedy should only be granted in the “most egregious circumstances”. It is important to note that this decision does not change the burden of proof in a tax appeal case, or change the requirement that a property produce some evidence at the tax board hearing. To view the case, Click Here.
- For Updated Information on this Case, Click Here. On November 15, 2012, the Tax Court once again held that a contract purchaser does not have standing to file a tax appeal. Prior to the April 1 tax appeal deadline, a contract purchaser filed a complaint to appeal the tax assessment of the property it was acquiring. The sale closed on May 30, 2012. The municipality filed a motion to dismiss the complaint since at the time of the appeal, the contract purchaser was not an “aggrieved taxpayer” since it had not paid any taxes on the property. The Tax Court agreed with the municipality and dismissed the appeal. Although this case did not change the law, it drives home the lesson that appealing parties must meet the definition of an aggrieved taxpayer to have standing to appeal. If a contract purchaser wants to have the tax assessment appealed, he or she must make certain the contract requires the seller to file an appeal and, once filed, expressly set forth each party’s rights and obligations (ie. who can settle the case). To view the case, Click Here.
- Hurricane Sandy visited New Jersey after the applicable valuation date of October 1, 2012. As a result, Hurricane Sandy will not be relevant in most tax appeals. However, if an owner complied with the requirements of N.J.S.A. 54:4-35.1 and sent a written notice to his or her tax assessor before January 10, 2013, he or she will be able to take advantage of a little know law which will make Sandy’s damage relevant to the 2013 tax appeal. Click here for more details on this statute. By moving the valuation date from October 1, 2012 to January 1, 2013, the damage from Sandy can be taken into account when valuing your property. The Tax Court has not issued many decisions interpreting this law, but Hurricane Sandy is likely to change that as cases progress through the court.
Tim Duggan and Marshall Kizner are members of Stark & Stark’s Eminent Domain and Real Estate Tax Group in our Lawrenceville, New Jersey office. For questions or additional information, please contact Mr. Duggan or Mr. Kizner.