Opinion
DOCKET NO. A-2590-11T1
05-09-2013
BEACH CREEK MARINA, INC., Plaintiff-Appellant, v. CITY OF NORTH WILDWOOD and TAX ASSESSOR FOR THE CITY OF NORTH WILDWOOD, Defendants-Respondents.
Flavio L. Komuves argued the cause for appellant (Zazzali, Fagella, Nowak, Kleinbaum & Friedman, attorneys; Robert A. Fagella, of counsel; Mr. Komuves, on the briefs). William J. Kaufmann argued the cause for respondent (Cafiero & Balliette, attorneys; Mr. Kaufmann, on the brief).
NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
Before Judges Grall and Simonelli.
On appeal from Superior Court of New Jersey, Law Division, Cape May County, Docket No. L-629-10.
Flavio L. Komuves argued the cause for appellant (Zazzali, Fagella, Nowak, Kleinbaum & Friedman, attorneys; Robert A. Fagella, of counsel; Mr. Komuves, on the briefs).
William J. Kaufmann argued the cause for respondent (Cafiero & Balliette, attorneys; Mr. Kaufmann, on the brief). PER CURIAM
Plaintiff Beach Creek Marina, Inc. owns real property in City of North Wildwood (City). In September 2010, Beach Creek filed an action in lieu of prerogative writs alleging that defendants, the City and its tax assessor, arbitrarily denied Beach Creek's July 28, 2010 demand for a reduction of its property's assessed value for 2006. Beach Creek now appeals the dismissal of that prerogative writ action on defendants' motion for summary judgment. We affirm substantially for the reasons stated by Judge Mendez as supplemented here.
The material facts are undisputed. Following a re-evaluation of all of the property within its boundaries, the City increased the assessed value of Beach Creek's property from $1,526,200 for 2005 to $14,612,900 for 2006. Pursuant to N.J.S.A. 54:3-21a(1), Beach Creek initially challenged its 2006 assessment in the Tax Court. But the Tax Court dismissed Beach Creek's complaint as untimely filed, and we affirmed that dismissal. Beach Creek Marina v. City of N. Wildwood, No. A-3986-07 (App. Div. May 18, 2009).
While this appeal was pending, the Tax Court denied Beach Creek's motion for relief from the judgment dismissing its 2006 challenge. The Tax Court concluded that Beach Creek had not established a basis for a grant of relief pursuant to Rule 4:50-1. Beach Creek Marina, Inc. v. City of N. Wildwood, No. 000081-2007 (Tax Nov. 26, 2012). Beach Creek's appeal from that order is not before us.
Beach Creek subsequently filed timely complaints in the Tax Court challenging its 2007 and 2008 assessments, which were both fixed at $14,288,900. In connection with those challenges, the City obtained an appraisal of Beach Creek's property from J. Paul Bainbridge, MAI, in March 2009. The Bainbridge appraisal states that the "retrospective market value of [Beach Creek's] property for 2006-2009 tax years" is $4,600,000. Thus, by March 2009 the City had information indicating that the 2006 assessment exceeded the property's 2006 value by about $10 million.
In a separate opinion we consolidate and address Beach Creek's appeals from the Tax Court's dismissal of its challenges to the 2007 and 2008 assessments. Beach Creek Marina v. N. Wildwood City, Nos. A-3081-11 & A-3082-11 (App. Div. May 9, 2013).
Defendants promptly disclosed the Bainbridge appraisal. It was part of the discovery the City provided to Beach Creek preparatory to the trial in the Tax Court on the challenges to the 2007 and 2008 assessments.
Following receipt of the Bainbridge appraisal, Beach Creek made the July 28, 2010 demand, at issue here, for a reduction of its 2006 assessment. That demand, and the prerogative writ action based on its denial, argued that the Bainbridge appraisal revealed that the tax assessor had failed to meet his statutory obligation to annually review all assessments to ensure those assessments are based on the "full and fair value of each parcel of real property situate in the taxing district." N.J.S.A. 54:4-23; Tri-Terminal Corp. v. Borough of Edgewater, 68 N.J. 405, 414 (1975), cert. denied, 425 U.S. 958, 96 S. Ct. 1739, 48 L. Ed. 2d 203 (1976). Beach Creek does not point to any statute other than N.J.S.A. 54:4-23 to support its claim of entitlement to a modification of the assessed value of its property outside the statutory appeal process.
This prerogative writ action was Beach Creek's second attempt to obtain a reduction in its 2006 assessment after its untimely appeal. The first was a challenge Beach Creek raised in an action to foreclose a tax sale certificate on its property. On February 3, 2011, Judge Todd dismissed that challenge and returned the case to the Office of Foreclosure with direction for the plaintiff to withhold its application for an order fixing the amount due and the date and time for redemption until such times as Beach Creek's tax appeals for 2007, 2008 and 2009 are resolved.
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After considering the undisputed facts and Beach Creek's untimely appeal of its 2006 assessment, Judge Mendez concluded that a tax assessor's obligation to review and revise assessments does not authorize revision of assessments for prior tax years. He reasoned that permitting adjustment of the 2006 assessment in this prerogative writ action would "flout the statutorily mandated [appeal] procedure of N.J.S.A. 54:3-21" and "contravene the policy behind it." We agree.
N.J.S.A. 54:4-23 addresses a tax assessor's statutory duty to annually value property in the taxing district. It provides procedures for revaluing multiple properties in the taxing district when there is reason to believe that all or a portion of the district property is assigned a value higher or lower than its full and fair value. In addition, N.J.S.A. 54:4-23 authorizes and requires "assessment maintenance" — a "practice by which an assessor changes some assessments in a year when a district-wide revaluation or reassessment is not performed." Regent Care Ctr., Inc. v. Hackensack City, 362 N.J. Super. 403, 411-12 (App. Div.), certif. denied, 178 N.J. 373 (2003); see also BASF Corp. Coating & Ink Div. v. Town of Belvidere, 22 N.J. Tax 550, 564-65 (Tax 2005), aff'd, 24 N.J. Tax 416 (App. Div. 2009) (discussing the purpose and scope of the statute).
Beach Creek has not referred us to any case approving "assessment maintenance" that includes an adjustment of an assessment for a prior tax year. More importantly, the plain meaning of the statute does not support retroactive adjustments.
N.J.S.A. 54:4-23 plainly states that it applies to assessments on "October 1 in each year." Nothing in the language of this statute suggests the Legislature intended to authorize tax assessors to rectify mistaken assessments in prior years. Its purpose, as the language the Legislature chose suggests, is prospective — an assessment for the next tax year consistent with fair and full value. See generally F.M.C. Stores Co. v. Borough of Morris Plains, 100 N.J. 418, 425-28 (1985) (holding that a municipality seeking to adjust an assessment must file a timely appeal and discussing an exception to strict compliance with the filing deadline that applies when adjustment is necessary to address discriminatory assessments).
The statutes governing a taxing district's obligation to assess real property at its full and fair value and statutes governing challenges to assessments are part of a comprehensive scheme and must be read together. The Supreme Court has explained the relationship between assessments and challenges that requires such a reading as follows.
"The policy of applying strict time limitations to tax matters is based upon the very nature of our administrative tax structure. Municipal budgets must be finalized no later than the 90th day after the beginning of the budget year. Real estate assessments, which constitute the bulk of a municipality's income are established as of October 1 of the pretax year. Throughout our tax legislation, it is clear that our legislature has attempted to set out a well organized time-table for the purpose of enabling a municipality to ascertain the amount of taxable ratables within the jurisdiction in order that it might adopt a responsible and fairly accurate budget."
[Id. at 425 (quoting Galloway Twp. v. Petkevis, 2 N.J. Tax 85 (Tax 1980)) (statutory citations omitted).]
As previously noted, N.J.S.A. 54:4-23 is the only statute Beach Creek cited in the trial court and cites on appeal. Beach Creek's demand was not a request for a tax abatement pursuant to N.J.S.A. 54:4-99, -100, but even if it had been, this court has held that the abatement statutes "do not authorize [a municipality] to use the authority contained therein to circumvent the statutory appeal process that must be used by taxpayers when challenging their tax assessments." Appeal of Twp. of Monroe from Determination of Local Fin. Bd., 289 N.J. Super. 138, 148 (App. Div. 1995), certif. denied, 144 N.J. 172 (1996).
The trial court's decision to dismiss the prerogative writ action as conflicting with and undermining the purposes of the statutorily mandated appeal procedure of N.J.S.A. 54:3-21 is consistent with this court's decision in Appeal of Township of Monroe from Determination of Local Finance Board. In that case, we held that a municipality lacked the authority to correct an assessment that it later deemed erroneously high by abating the tax in the interest of equity. Id. at 145. Owners of condominiums objected to their 1994 assessments as discriminatory and informed the governing body that they had not filed timely tax appeals because the tax assessor had assured them their assessments for 1994 would be reduced. Id. at 143. Whether to accommodate the taxpayers or correct a mistake, the township's governing body passed a resolution abating their taxes for the year in question. Id. at 143-44. The board of local finance, however, directed the municipality to refrain from issuing the checks. Id. at 144.
On the township's appeal, we upheld the board's ruling. The panel reasoned that N.J.S.A. 54:3-21 controls tax appeals and that its time limits are "jurisdictional." Id. at 145-46. Further determining that circumstances justifying a tax abatement pursuant to N.J.S.A. 54:4-99, -100, had not been shown, the panel held that Monroe Township's effort to provide redress for an erroneous assessment improperly circumvented the statutory scheme. Id. at 146. The panel noted that abatements were not intended to provide an alternate means of redress for taxpayers who had not filed timely appeals. Id. at 148.
The trial judge's dismissal of this prerogative writ action is also consistent with decisions of this court recognizing the primacy of the statutory appeal process over actions in lieu of prerogative writs. We have done that by affirming the dismissal of such actions challenging property taxes that were filed before exhaustion of the statutory appeals process. See, e.g., J.H. Becker, Inc. v. Twp. of Marlboro, 82 N.J. Super. 519, 529-30 (App. Div. 1964) (affirming the dismissal of prerogative writ actions seeking, among other things, adjustment of assessments that were filed without exhausting administrative remedies).
Affirmed.
I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION