Opinion
Index No. 70367
09-11-2023
In the Matter of the Application of Peaceful Valley Housing Development Fund Corp. and PEACEFUL VALLEY TOWNHOUSES, L.P., Petitioners, v. Town of Johnsburg and ANDREA HOGAN, AS TOWN SUPERVISOR, Respondents.
Mazzotta & Vagianelis, P.C., Albany (John N. Vagianelis of counsel), for petitioners Miller, Mannix, Schachner & Hafner, LLC, Glens Falls (Jacquelyn P. White of counsel), for respondents.
Unpublished Opinion
Mazzotta & Vagianelis, P.C., Albany (John N. Vagianelis of counsel), for petitioners
Miller, Mannix, Schachner & Hafner, LLC, Glens Falls (Jacquelyn P. White of counsel), for respondents.
Robert J. Muller, J.
Petitioners are the owners of an 18-acre parcel of real property located at 18 Peaceful Valley Ridge in the Town of Johnsburg, Warren County. On March 4, 2004, the Town Board for respondent Town of Johnsburg (hereinafter the Town) adopted a resolution whereby petitioners were granted a real property tax exemption for the property under Private Housing Finance Law § 577, which authorizes exemptions for low-income housing. At that time the property was undeveloped, with petitioners planning to build five 4-unit apartment buildings and a community building. In accordance with this resolution, petitioners and the Town signed a Payment-in-Lieu-of-Tax Agreement (hereinafter PILOT Agreement) on October 24, 2005, which required annual payments of $6,000.00 for years one through five, $6,600.00 for years six through ten, and $7,260.00 for years eleven through fifteen. This PILOT Agreement stated, in pertinent part:
"The Town hereby grants to [petitioners] an exemption from local and municipal taxes, including school taxes, other than assessments for local improvements, under the provisions of [Private Housing Finance Law § 577] and pursuant to the terms set forth in this Agreement for a period of fifteen (15) years commencing with the first tax year following completion of the [p]roject....
"This Agreement shall become effective on the first tax status date following completion of the [p]roject,and continue for a term of fifteen (15) years thereafter"].
The first taxable status date following their issuance was March 1, 2007, with petitioner making its first payment under the PILOT Agreement on June 4, 2007. Petitioner continued making these payments annually, with the last payment made on June 11, 2021. In August 2021, the Town's assessor notified petitioners that its exemption was being removed for the upcoming 2022 assessment roll and, on or about May 1, 2022, the assessor advised petitioners that the property was assessed at $2,977,400.00 for 2022 with $48,162.00 due in taxes.
Meanwhile, petitioners contacted the Town and proposed a new 15-year PILOT Agreement, with several emails exchanged between the parties in May and June of 2022. The Town Board thereafter considered the proposal and decided not to approve it, with counsel for the Town advising counsel for petitioners of this determination on June 23, 2022. Counsel for petitioners then sent an email to counsel for the Town on June 27, 2022 contending that the PILOT Agreement in fact entitled petitioners to an exemption until December 31, 2022. According to petitioners, the exemption commenced "the first tax year following completion of the [p]roject" and, because the project was completed in 2007, the exemption was effective from 2008 through 2022.
Respondents rejected this interpretation and, on July 22, 2022, petitioners commenced this CPLR article 78 proceeding seeking an Order declaring the property exempt from taxation for 2022 under the terms of the PILOT Agreement and, further, directing the Town to list the property as exempt on the 2022 tax assessment roll. Presently before the Court is (1) respondents' motion to dismiss the petition based upon documentary evidence (see CPLR 3211 [a] [1]); and (2) petitioners' cross motion for summary judgment granting the relief requested in the petition (see CPLR 3212). The motion and cross motion will be addressed ad seriatim. Turning first to respondents' motion to dismiss, "'[a] motion pursuant to CPLR 3211 (a) (1)... may be properly granted only if the documentary evidence utterly refutes [petitioners'] factual allegations, conclusively establishing a defense as a matter of law. To qualify as documentary evidence, the evidence must be unambiguous and of undisputed authenticity'" (Koziatek v SJB Dev. Inc., 172 A.D.3d 1486, 1486 [3d Dept 2019], quoting Calhoun v Midrox Ins. Co., 165 A.D.3d 1450, 1450 [3d Dept 2018] [internal quotation marks, brackets and citations omitted]; see Doller v Prescott, 167 A.D.3d 1298, 1299 [3d Dept 2018]). "'Materials that clearly qualify as documentary evidence include documents reflecting out-of-court transactions such as mortgages, deeds, contracts, and any other papers, the contents of which are essentially undeniable'" (Koziatek v SJB Dev. Inc., 172 A.D.3d at 1487, quoting Ganje v Yusuf, 133 A.D.3d 954, 956-957 [3d Dept 2015] [citations omitted]; see Midorimatsu, Inc. v Hui Fat Co., 99 A.D.3d 680, 682 [2d Dept 2012], lv dismissed 22 N.Y.3d 1036 [2013]).
Here, respondents have submitted a copy of the PILOT Agreement, contending that the terms thereof clearly refute petitioners' factual allegations. More specifically, respondents contend that the PILOT Agreement expressly applies to tax years - which do not run concurrently with calendar years.
Indeed, while a calendar year begins on January 1, a tax year begins on March 1 - the taxable status date (see RPTL 302 [1]). Pursuant to the PILOT Agreement, petitioners were to receive a tax exemption "for a period of fifteen (15) years commencing with the first tax year following completion of the [p]roject." The Agreement likewise provided that it would "become effective on the first tax status date following completion of the [p]roject, and continue for a term of fifteen (15) years thereafter." The project was completed in February 2007, with the first tax year then commencing on March 1, 2007. Petitioners in fact recognized this point, making their first payment on June 4, 2007. The exemption then continued for a term of 15 years, expiring on March 1, 2022.
Although petitioners now contend that the 2007 payment was made in error, this contention is wholly without merit. Petitioners made 15 payments to the Town in lieu of tax, as provided under the PILOT Agreement - there is nothing in the Agreement entitling them to make a sixteenth payment. The Court finds that the PILOT Agreement utterly refutes petitioners' factual allegations, conclusively establishing respondents' defense as a matter of law (see Zeppieri v Vinson, 190 A.D.3d 1173, 1175 [3d Dept 2021]; Calhoun v Midrox Ins. Co., 165 A.D.3d at 1452). Respondents' motion to dismiss is therefore granted in its entirety based upon documentary evidence, and petitioners' cross motion for summary judgment is necessarily denied.
To the extent that respondents also moved to dismiss the petition based upon the failure to state a cause of action and the absence of subject matter jurisdiction (see CPLR 3211 [a] [1], [2]), the Court notes that the failure to state a cause of action likely provides another basis for dismissal. The lack of subject matter jurisdiction is more questionable. This argument is premised upon petitioners' failure to exhaust administrative remedies - namely, the grievance procedure for assessments outlined in RPTL article 7 - but the applicability of this procedure is questionable given petitioners' breach of contract allegations. Respondents further argue that - because the petition alleges breach of contract and seeks a declaratory judgment - petitioners should have commenced a plenary action, as opposed to a CPLR article 78 proceeding. This issue is now moot, however, given the foregoing analysis.
Therefore, having considered the Petition with exhibits attached thereto, verified July 13, 2022; Affidavit of Jacquelyn P. White, Esq. with exhibits attached thereto, sworn to September 19, 2022, submitted in support of the motion; Affidavit of Letitia Williams with exhibits attached thereto, sworn to September 19, 2022, submitted in support of the motion; Memorandum of Law of Jacquelyn P. White, Esq., dated September 20, 2022, submitted in support of the motion, Affidavit of Randell J. Denton with exhibits attached thereto, sworn to September 23, 2022, submitted in opposition to the motion and in support of the cross motion; Memorandum of Law of John N. Vagianelis, Esq., dated September 27, 2022, submitted in opposition to the motion and in support of the cross motion; Reply Memorandum of Law of Jacquelyn P. White, Esq., dated October 14, 2022, submitted in further support of the motion and in opposition to the cross motion; and correspondence of John N. Vagianelis, Esq., dated October 20, 2022, submitted in further support of the cross motion; and oral argument having been heard on August 22, 2023 with John N. Vagianelis, Esq. appearing on behalf of petitioners and Jacquelyn P. White, Esq. appearing on behalf of respondents, it is hereby
ORDERED AND ADJUDGED that respondents' motion to dismiss is granted and the petition is dismissed in its entirety; and it is further
ORDERED AND ADJUDGED that petitioners' cross motion for summary judgment is denied.
The above constitutes the Decision and Order of this Court.
The original of this Decision and Order has been filed by the Court together with the Notice of Petition dated July 20, 2022, the Notice of Motion dated September 20, 2022, the Notice of Cross Motion dated September 27, 2022, and the submissions enumerated above. Counsel for respondents is hereby directed to serve a copy of the Decision and Order on petitioners with notice of entry.