Justia Civil Procedure Opinion Summaries

Defendant Darren Rose, a member of the Alturas Indian Rancheria, ran two smoke shops located in Indian country but far from any lands governed by the Alturas Indian Rancheria. In those smoke shops, Rose sold illegal cigarettes and failed to collect state taxes. California brought an enforcement action to stop illegal sales and collect civil penalties. Rose appealed, arguing: (1) California and its courts did not have jurisdiction to enforce California’s civil/regulatory laws for his actions in Indian country; and (2) the amount of civil penalties imposed was inequitable and erroneous. The Court of Appeal concluded: (1) federal law and tribal sovereignty did not preempt California’s regulation and enforcement of its laws concerning sales of cigarettes; and (2) the superior court’s imposition of civil penalties was proper. View "California v. Rose" on Justia Law

In May 2007, the Medical Center Hospital Authority (“Hospital Authority”) filed an action against the Columbus Board of Tax Assessors and related parties (together, “the Tax Board”) in which it sought a declaration that its leasehold interest in a building located on real property owned by a private entity constituted public property exempt from ad valorem taxation under OCGA 48-5-41 (a) (1). The superior court granted summary judgment to the Hospital Authority, finding that the Hospital Authority’s leasehold interest qualified as “public property,” and was thus exempt from ad valorem property taxation. The Tax Board appealed this decision to the Court of Appeals, which affirmed the trial court’s grant of summary judgment. The Georgia Supreme Court granted certiorari to decide whether the Court of Appeals erred in determining that two prior bond validation orders conclusively determined, for purposes of OCGA 48-5-41 (a) (1) (A), that the property at issue was “public property” exempt from ad valorem taxation. The Court held that these orders did not conclusively establish that the Hospital Authority’s leasehold interest was “public property” exempt from ad valorem taxes and therefore reversed the Court of Appeals and remanded this case for further proceedings. View "Columbus Board of Tax Assessors v. Medical Center Hospital Authority" on Justia Law

Petitioner Ann Hardegger filed a complaint in the district court seeking contribution from respondents Daniel and Cheryl Clark, for their proportionate share of a payment she made to the Internal Revenue Service (“IRS”) in full satisfaction of the parties’ joint and several tax liabilities. In October 2010, the Clarks filed a joint voluntary Chapter 7 bankruptcy petition and gave notice to their creditors, including the Hardeggers. The Hardeggers did not file a proof of claim in the bankruptcy proceeding, and the bankruptcy court granted the Clarks a discharge. In Hardegger’s case, the district court found the Clarks responsible for one-half of the IRS indebtedness and entered summary judgment in Hardegger’s favor. A division of the court of appeals reversed, however, concluding that Hardegger’s contribution claim constituted a pre-petition debt that had been discharged in the Clarks’ bankruptcy case. Applying the “conduct test,” under which a claim arises for bankruptcy purposes at the time the debtor committed the conduct on which the claim is based, the Colorado Supreme Court concluded that Hardegger’s claim for contribution arose when the parties’ jointly owned company incurred federal tax withholding liability between 2007 and 2009, rendering Hardegger and Clark potentially responsible for that debt. Because this conduct occurred before the Clarks filed their bankruptcy petition in 2010, Hardegger’s claim constituted a pre-petition debt that was subject to discharge. View "Hardegger v. Clark" on Justia Law

Linda Dunn appealed a district court’s judgment affirming the Idaho State Tax Commission’s deficiency determination. The Commission issued a deficiency against Linda after determining that her one-half community interest in her husband’s, Barry Dunn (“Husband”), out-of-state earnings should have been included as Idaho taxable income for 2000–01, 2003–05, and 2007–10 (the “Taxable Years”). Linda was married to Husband during the Taxable Years. During the Taxable Years, Husband lived primarily in Texas, employed by a Texas offshore drilling company. All of the earnings at issue were earned by Husband personally as a wage earner in Texas, Alaska, or Washington and were directly deposited into his bank account in Tomball, Texas. Husband never worked or was domiciled in Idaho during the Taxable Years. Throughout the Taxable Years, Linda temporarily lived with Husband at his work location, but always returned to Idaho to operate a horse farm. She was a resident of Idaho for all of the Taxable Years. Linda and Husband’s tax filing status was “married filing jointly.” Linda relied on Texas law for her argument that her interest in Husband’s earnings were immune from Idaho income tax. The Commission maintained Linda, as an Idaho resident, was taxed on all income she received during the Taxable Years while domiciled in Idaho, even if that income was derived from Texas. Finding no reversible error in the district court’s affirmance of the Commission’s decision, the Idaho Supreme Court affirmed. View "Dunn v. Idaho Tax Commission" on Justia Law

Prior to its dissolution, Culver City’s former redevelopment agency made an unauthorized transfer to the City of about $12.5 million. The Department of Finance (DOF) discovered the unauthorized transfer after the former redevelopment agency was dissolved and the City took over as the successor agency. Based on that discovery, DOF authorized the county auditor-controller to reduce by about $12.5 million the tax increment revenue made available to the successor agency to pay the successor agency’s enforceable obligations. In a prior action, the Sacramento Superior Court held that the former redevelopment agency should have retained the $12.5 million to pay its bills rather than transferring it to the City. DOF did not seek an order requiring the City to repay the $12.5 million. And neither party appealed the superior court’s judgment. Since judgment was entered in “Culver City I”, the City has not repaid the $12.5 million to the successor agency, and DOF has continued to authorize successive reductions to the allotment of tax increment revenue to the successor agency to pay its enforceable obligations. DOF asserts that those funds held by the City are available to the successor agency for payment of its enforceable obligations, but the City maintains that it has no duty to pay the money back. In this action, the City, both in its municipal capacity and as the successor agency of the former redevelopment agency, sought mandamus relief to stop DOF’s successive reductions of tax increment revenue to pay the successor agency’s enforceable obligations. DOF sought an order reversing the former redevelopment agency’s transfer of $12.5 million to the City and requiring the City to return the money. The superior court in this action held that DOF’s successive reductions were not authorized by the Dissolution Law. Based on this holding, the superior court granted the City’s petition for writ of mandate. While recognizing Culver City I’s holding that the former redevelopment agency’ss transfer to the City was unauthorized, the superior court denied DOF’s petition for an equitable writ of mandate requiring the return of the money because there was a statutory remedy for this situation. The State Controller conducted a review and ordered the City to return the $12.5 million to the successor agency. DOF appealed, asserting that the superior court erred by: (1) denying DOF’s petition for writ of mandate directing the City to return the money and (2) finding that successive reductions to the tax increment revenue provided to the successor agency for the same $12.5 million held by the City was not authorized by the Dissolution Law. The Court of Appeal affirmed. View "City of Culver City v. Cohen" on Justia Law

Baruch SLS, Inc., a Michigan nonprofit corporation, sought exemptions from real and personal property taxes as a charitable institution under MCL 211.7o and MCL 211.9 for tax years 2010–2012. Petitioner based its request on the fact that it offered an income-based subsidy to qualifying residents of Stone Crest Assisted Living, one of its adult foster care facilities, provided those residents had made at least 24 monthly payments to petitioner. The Tax Tribunal ruled that Stone Crest was not eligible for the exemptions because petitioner did not qualify as a charitable institution under three of the six factors set forth in Wexford Med Group v City of Cadillac, 474 Mich 192 (2006). The Court of Appeals reversed with respect to two of the Wexford factors, but affirmed the denial of the exemptions on the ground that petitioner had failed to satisfy the third Wexford factor because, by limiting the availability of its income-based subsidy, petitioner offered its services on a discriminatory basis. The Michigan Supreme Court found the third factor in the Wexford test excluded only restrictions or conditions on charity that bore no reasonable relationship to a permissible charitable goal. Because the lower courts did not consider Baruch’s policies under the proper understanding of this factor, the Court vacated the Court of Appeals’ and Tax Tribunal’s opinions in part and remanded this case to the Tax Tribunal for further proceedings. View "Baruch SLS, Inc. v. Twp of Tittabawassee" on Justia Law

The Virgin Islands Bureau of Internal Revenue (BIR) sent the Hassens a final notice of intent to levy their property to satisfy an outstanding tax debt of $5,778.32 for the 2004 tax year and subsequently issued a levy against the Hassens’ bank account. In June and December 2013, the Hassens submitted letters requesting an installment agreement. The December letter reflects that the Hassens and the BIR engaged in discussions and that the BIR directed the Hassens to submit IRS Form 9465 to request an installment agreement. The Hassens failed to do so. Thereafter, the BIR issued four additional levies against the Hassens’ accounts. Rather than file an administrative claim as required by 26 U.S.C. 7433(d), the Hassens filed suit under section 7433(a), alleging that the additional levies violated 26 U.S.C. 6331(k)(2), which prohibits the issuance of any levy while a proposed installment agreement is pending. The district court determined that exhaustion of administrative remedies was not a jurisdictional prerequisite, but was a condition to obtain relief, and dismissed their complaint. The Third Circuit affirmed. To bring a claim under section 7433(a), a taxpayer must exhaust the administrative remedies under section 7433(d). While such exhaustion is not a jurisdictional requirement, it is mandatory. View "Hassen v. Government of the Virgin Islands" on Justia Law

Consolidated appeals arose out of a complaint filed by four Georgia taxpayers in which they challenged the constitutionality of Georgia’s Qualified Education Tax Credit, Ga. L. 2008, p. 1108, as amended (“HB 1133” or the “Bill”). HB 1133 set up a tax credit program that allows individuals and businesses to receive a Georgia income tax credit for donations made to approved not-for-profit student scholarship organizations (“SSOs”). The Bill created a new tax credit statute for that purpose. Generally speaking, the SSO is required to distribute the donated funds as scholarships or tuition grants for the benefit of students who meet certain eligibility requirements, and the parent or guardian of each recipient must endorse the award to the accredited private school of the parents’ choice for deposit into the school’s account. Plaintiffs alleged: (1) the Program was educational assistance program, and the scheme of the Program violated the Constitution; (2) the Program provided unconstitutional gratuities to students who receive scholarship funds under the Program by allowing tax revenue to be directed to private school students without recompense, and also that the tax credits authorized by HB 1133 resulted in unauthorized state expenditures for gratuities; (3) the Program took money from the state treasury in the form of dollar-for-dollar tax credits that would otherwise be paid to the State in taxes, and since a significant portion of the scholarships awarded by the SSOs goes to religious-based schools, the Program takes funds from the State treasury to aid religious schools in violation of the Establishment Clause; and (4) the Department of Revenue violated the statute that authorized tax credits for contributions to SSOs by granting tax credits to taxpayers who have designated that their contribution is to be awarded to the benefit of a particular individual, and by failing to revoke the status of SSOs that have represented to taxpayers that their contribution will fund a scholarship that may be directed to a particular individual. Plaintiffs sought mandamus relief to compel the Commissioner of Revenue to revoke the status of SSOs, and injunctive relief against the defendants to require them to comply with the constitutional provisions and statutory laws set forth in the complaint. In addition to mandamus relief and injunctive relief, plaintiffs sought a declaratory judgment that the Program was unconstitutional. The Georgia Supreme Court found no error in the trial court’s finding plaintiffs lacked standing to pursue their constitutional claims, or their prayer for declaratory relief with respect to those claims, either by virtue of their status as taxpayers or by operation of OCGA 9-6-24. Consequently plaintiffs failed to allege any clear legal right to mandamus relief. View "Gaddy v. Georgia Dept. of Revenue" on Justia Law

An individual’s standing to sue under Cal. Code Civ. Proc. 526a does not require the payment of a property tax, as an allegation that the plaintiff has paid an assessed tax to the defendant locality is sufficient under section 526a.The trial court filed a stipulated order and judgment of dismissal dismissing for lack of standing Plaintiff’s complaint for declaratory and injunctive relief challenging the manner in which the City of San Rafael and County of Marin enforced Cal. Veh. Code 14602.6. The court of appeal affirmed, concluding that an individual plaintiff must be liable to pay a property tax within the relevant locality, or have paid a property tax during the previous year, to have standing. The Supreme Court reversed, holding that the court of appeal erred when it held that payment of a property tax was required under section 526a. View "Weatherford v. City of San Rafael" on Justia Law

New Hampshire Electric Cooperative, Inc. (NHEC) filed tax abatement appeals to the Board of Tax and Land Appeals (BTLA) for 23 municipal assessments of its property that occurred in 2011 and 2012. The BTLA held a consolidated hearing over nine days between January and February 2015 regarding NHEC’s tax abatement appeals. During the hearing, NHEC presented expert witness testimony and an appraisal of NHEC’s property from George Lagassa, a certified general real estate appraiser and the owner of Mainstream Appraisal Associates, LLC. In his appraisals, Lagassa estimated the market value of NHEC’s property by reconciling the results of four valuation approaches: a sales comparison approach; an income approach, which estimated the value of NHEC’s property by capitalizing the company’s net operating income; a cost approach, which estimated the net book value (NBV) of NHEC’s property by calculating the original cost less book depreciation (OCLBD) of NHEC’s property; and a second cost approach, which estimated the value of NHEC’s property by calculating the reproduction cost new less depreciation (RCNLD) of NHEC’s property. NHEC appeals the BTLA order denying 16 of NHEC’s 23 individual tax abatement appeals regarding its property. The New Hampshire Supreme Court found no reversible error in the BTLA’s order and affirmed it. View "Appeal of New Hampshire Electric Cooperative, Inc." on Justia Law