Justia Civil Procedure Opinion Summaries

In filing mortgage foreclosure cases, the plaintiffs each paid a $50 “add on” filing fee under section 15-1504.1 of the Code of Civil Procedure. The plaintiffs challenged the constitutionality of section 15-1504.1 and of sections 7.30 and 7.31 of the Illinois Housing Development Act, 20 ILCS 3805/7.30, 7.31, which created foreclosure prevention and property rehabilitation programs funded by the fee.The trial court, following a remand, held that the fee violated the equal protection, due process, and uniformity clauses of the Illinois Constitution of 1970. The Illinois Supreme Court affirmed, finding that the fee violates the constitutional right to obtain justice freely. The $50 filing charge established under section 15-1504.1, although called a “fee,” is, in fact, a litigation tax; it has no direct relation to expenses of a petitioner’s litigation and no relation to the services rendered. The court determined that the plaintiffs paid the fee under duress; the voluntary payment doctrine did not apply. View "Walker v. Chasteen" on Justia Law

An oil producer challenged an Alaska Department of Revenue advisory bulletin interpreting the oil tax code, arguing that the bulletin violated the Alaska Administrative Procedure Act (APA) and seeking a declaratory judgment that the interpretation was contrary to law. The Alaska Supreme Court determined the advisory bulletin could not be challenged under the APA because it was not a regulation, and that a declaratory judgment was not available because the tax dispute between the parties was not ripe. View "Exxon Mobil Corporation v. Alaska, Department of Revenue" on Justia Law

Plaintiff filed suit seeking a declaratory judgment that an IRS transfer certificate is not necessary to transfer ownership of her account with Fidelity. The district court sua sponte dismissed the action for lack of subject matter jurisdiction, concluding that such a declaration would necessarily involve a determination with respect to federal taxes.The Fifth Circuit affirmed, concluding that the Declaratory Judgment Act's federal-tax exception is a jurisdictional condition, requiring dismissal, rather than a nonjurisdictional condition, which may be waived. In this case, because the requested relief—declaring that plaintiff was not required to provide a transfer certificate to Fidelity—necessarily involves a determination with respect to federal taxes, the district court properly dismissed her action for lack of jurisdiction. View "Rivero v. Fidelity Investments, Inc." on Justia Law

This case arose from a taxpayer grievance concerning whether the Fulton County Board of Tax Assessors (the “Board”) had been diligent in determining that the Atlanta Falcons Stadium Company LLC (“StadCo”) had a usufruct interest in the Mercedez-Benz Stadium that was not subject to ad valorem taxation. In 2017, Albert Love and other Fulton County taxpayers (collectively, Appellants) sued the Board, the individual members of the Board, and the Board’s Chief Appraiser, seeking mandamus and other relief. Since then, the suit was dismissed, appealed to the Court of Appeals, remanded, amended to add claims and intervenors, then dismissed again. At issue in this appeal was whether the trial court properly dismissed Appellants’ fourth amended petition, which asserted claims for mandamus, declaratory and injunctive relief, and a refund of taxes paid. Appellants contended the trial court erred in dismissing the petition, allegedly sua sponte, arguing primarily that the trial court had applied an incorrect standard of review. They also contended the trial court erred in declining to find OCGA 10-9-10 unconstitutional. Finding no reversible error, the Georgia Supreme Court affirmed the trial court’s dismissal. View "Love et al. v. Fulton Cty. Bd. of Tax Assessors et al." on Justia Law

Shamblin Hamilton appealed a circuit court judgment concluding he had no interest in a Birmingham property, and ejected him from the property. In 1992, the property was conveyed to Shamblin and Carol Hamilton by general warranty deed. The Hamiltons owned the property in fee simple subject to a mortgage to Compass Bank recorded in 2003. In 2004, Shambin and Carol divorced, and pursuant to that divorce judgment, Shamblin was awarded sole ownership of the property. In 2009, the divorce judgment was modified by an agreement of the parties, and a court order adopting that agreement declared that Shamblin had assumed sole responsibility of a home-equity line of credit that Shamblin and Carol had jointly executed with Compass Bank. In his filings in the circuit court in this case, Shamblin asserted that he was still making payments on the home-equity line of credit as the litigation ensued. The Hamiltons failed to pay the ad valorem real-property taxes on the property, and in 2014, the State sold the property at auction to Mercury Funding, LLC ("Mercury"). Mercury conveyed its interested to Guardian Tax AL, LLC (“Guardian”) by quitclaim deed. In 2018, Guardian filed a complaint for ejectment and to quiet title to the property against the Hamiltons and Compass Bank. Shamblin denied not paying the ad valorem property taxes on the property, and he asserted that he had no notice of delinquency even though he had retained physical ownership of the property since 1992. Shamblin asserted a counterclaim for judicial redemption of the property, arguing he, not Carol as part title-holder, had a right to redeem. The Alabama Supreme Court determined the trial court erred in holding Carol had a right to redeem, and reversed. View "Hamilton v. Guardian Tax AL, LLC, et al." on Justia Law

Tillman filed a petition for leave to file a taxpayer action under 735 ILCS 5/11-303, to enjoin the disbursement of public funds, alleging that certain general obligation bonds issued by the state in 2003 and 2017 were unconstitutional. He claimed the bonds violated article IX, section 9(b), of the Illinois Constitution on the ground that they were not issued for qualifying “specific purposes,” which, he argued, refers exclusively to “specific projects in the nature of capital improvements, such as roads, buildings, and bridges.” The 2003 “State pension funding” law authorized $10 billion in bonds to be issued “for the purpose of making contributions to the designated retirement systems.” The 2017 law authorized “Income Tax Proceed Bonds,” ($6 billion) “for the purpose of paying vouchers incurred by the State prior to July 1, 2017.”The circuit court denied the petition. The appellate court reversed. The Illinois Supreme Court reinstated the judgment of the circuit court. the necessary elements for laches have been met in this case: “lack of due diligence by the party asserting the claim” and “prejudice to the opposing party.” There is no reasonable ground under section 11-303 of the Code for filing the petitioner’s proposed complaint View "Tillman v. Pritzker" on Justia Law

IRS Notice 2016–66 requires taxpayers and “material advisors” to report information about "micro-captive" insurance agreements. The consequences for non-compliance include civil tax penalties and criminal prosecution. Before the first reporting deadline, CIC challenged the Notice as invalid under the Administrative Procedure Act and sought injunctive relief. The Sixth Circuit affirmed the dismissal of the action, citing the Anti-Injunction Act, 26 U.S.C. 7421(a), which generally requires those contesting a tax’s validity to pay the tax before filing a legal challenge.A unanimous Supreme Court reversed. A suit to enjoin Notice 2016–66 does not trigger the Anti-Injunction Act even though a violation may result in a tax penalty; it is not an action to restrain the “assessment or collection” of a tax, even if the information will help the IRS collect future tax revenue. CIC seeks to set aside the Notice itself, not the tax penalty that may follow its breach. CIC stands nowhere near the cusp of tax liability. The presence of criminal penalties forces CIC to bring an action in this form, with the requested relief framed in this manner. To disobey the Notice and pay the resulting penalty before suing for a refund would risk criminal punishment. Allowing CIC’s suit to proceed will not open the floodgates to pre-enforcement tax litigation. Because the IRS chose to address its concern about micro-captive agreements by imposing a reporting requirement rather than a tax, suits to enjoin that requirement are outside the Anti-Injunction Act. View "CIC Services., LLC v. Internal Revenue Service" on Justia Law

Jefferson County ("the county") filed a complaint against Wilbert of Birmingham, LLC ("Wilbert"), Lisa D. Turner, and Marvin Lands ("the taxpayers") seeking an order requiring the taxpayers to pay various taxes and license fees they allegedly owed to the county. The circuit court ruled in favor of the county and ordered the taxpayers to pay to the county $112,728.96 plus accrued interest and court costs. The taxpayers appealed. The merits of the circuit court's ruling were not actually before the Alabama Supreme Court in this appeal. Instead, the issue raised in the taxpayers' brief was whether the circuit court obtained jurisdiction over the matter pursuant to the Alabama Taxpayers' Bill of Rights and Uniform Revenue Procedures Act, 40-2A-1 et seq., Ala. Code 1975 ("the TBOR"). The Supreme Court found the taxpayers demonstrated that, by failing to schedule a conference with the taxpayers concerning the preliminary assessments, the county's department of revenue did not strictly comply with the procedural requirements of the TBOR. That failure to strictly comply with the procedural requirements of the TBOR deprived the circuit court of jurisdiction over the county's action against the taxpayers, and, thus, the order entered in favor of the county was void. Therefore, the Supreme Court dismissed the taxpayers' appeal and instructed the circuit court to vacate its judgment in favor of the county and to dismiss the case. View "Wilbert of Birmingham, LLC, et al. v. Jefferson County" on Justia Law

Pro se petitioner-appellant John Minemyer appealed two orders from the United States Tax Court. The first order granted the Commissioner of Internal Revenue’s (“Commissioner’s”) Motion for Partial Summary Judgment and denied Minemyer’s Motion for Summary Judgment. The second order denied Minemyer’s Motion for Reconsideration. Neither order, however, was a final decision by the Tax Court. Further, Minemyer’s appeal of those orders did not ripen after the Tax Court issued an opinion, without a “decision,” addressing the only remaining claim. Accordingly, the Tenth Circuit dismissed Minemyer’s appeal for lack of appellate jurisdiction. View "Minemyer v. CIR" on Justia Law

Plaintiff-appellee Warehouse Market subleased a commercial building from defendant Pinnacle Management, Inc. The building was on federally restricted Indian land. Subsequently, defendant-appellant, Oklahoma Tax Commission (OTC) and the Muscogee (Creek) Nation Office of Tax Commission (Tribe) both sought to collect sales tax from Warehouse Market. Warehouse Market filed an interpleader action in an attempt to have the court determine which entity to pay. However, the trial court dismissed the Tribe because it had no jurisdiction over it because of the Tribe's sovereign immunity. The trial court then determined that the OTC could not be entitled to the sales tax unless and until the dispute between the OTC and the Tribe was resolved in another forum or tribunal. The Oklahoma Supreme Court held that because the substance of Warehouse Market's action/request for relief was a tax protest, exhaustion of administrative remedies was a jurisdictional prerequisite to seeking relief in the trial court. View "Warehouse Market v. Oklahoma ex rel. Ok. Tax Comm." on Justia Law