Opinion
Docket No. A-3516-13 Tax Court Docket No. 012506-2013
04-29-2014
Re: Smart Publications, LLC et al. v. Director, Division of Taxation
VITO L. BIANCO
JUDGE
Via Fax and Regular Mail:
Joseph H. Orlando, Clerk
Superior Court of New Jersey
Appellate Division
25 Market Street
Trenton, NJ 08625-0006
Harold P. Cook, III, Esq.
886 Belmont Avenue, Suite B
North Haledon, NJ 07508
Michelline Capistrano Foster, DAG
Division of Law
25 Market Street
Trenton, NJ 08625-0106
Mr. Orlando and counsel:
This revised letter is issued pursuant to Rule 2:5-1(b) to amplify the court's November 8, 2013 and February 28, 2014 bench opinions, which were memorialized in orders of the same dates, and sets forth the court's findings of facts and conclusions of law relating to the Director's Motion to Dismiss for Lack of Jurisdiction as well as Smart Publications, LLC's and Anthony Lombardo's (collectively "the taxpayer") Motion for Reconsideration.
Mr. Lombardo is the sole member of Smart Publications, LLC.
There is no dispute regarding the relevant facts. After a hearing with the taxpayer, who was represented by counsel, the Director issued a Final Determination on Monday, May 6, 2013, with respect to Smart Publications, LLC's Sales and Use Tax liability from October 2009 through June 2012, finding that the amount due was $144,000. The Director mailed the Final Determination to the taxpayer via certified mail, return receipt requested, and also mailed a copy to the taxpayer's attorney via ordinary mail. On Wednesday, May 8, 2013, the certified mail was accepted by Mr. Lombardo's mother at the registered address of Smart Publications, LLC, which was also Mr. Lombardo's primary residence. On Friday, May 10, 2013, the taxpayer's attorney received a copy of the Final Determination at his office. The next day, Saturday, May 11, 2013, Mr. Lombardo became aware of the certified letter when he went to his residence. On Tuesday, August 6, 2013, the taxpayer's attorney mailed the complaint at issue to the Tax Court of New Jersey via certified mail. The complaint was received by the Tax Court on Friday, August 9, 2013.
N.J.S.A. 54:49-18 allows an initial administrative hearing in response to a finding or assessment by the director.
On October 9, 2013, the Director filed a Notice of Motion to Dismiss for Lack of Jurisdiction, which was subsequently heard on November 8, 2013 and granted. The taxpayer filed a Motion for Reconsideration on November 26, 2013, arguing for the first time that there is a "timely mailed, timely filed" rule for the Tax Court. The court granted the Motion for Reconsideration but ultimately affirmed the Motion to Dismiss for Lack of Jurisdiction for the reasons set forth herein.
"[W]hen a complaint may be filed is a matter of jurisdiction." Heico Corp. v. Dir., Div. of Taxation, 20 N.J. Tax 106, 125 (Tax 2002) (emphasis omitted). To commence an action, original papers must be filed with the Clerk of the Tax Court. See R. 8:3-1(a); 1:5-6(b)(7). New Jersey does not have a "timely mailed, timely filed" rule with respect to Tax Court complaints—complaints are filed when received. See Dougan v. Dir., Div. of Taxation, 17 N.J. Tax 110 (App. Div. 1997). Although N.J.S.A. 54:51A-14 establishes that a "complaint[] shall be filed within 90 days after the date of the action sought to be reviewed," court rules determine the manner in which the limitations period is calculated. See, e.g., Liapakis v. State Dept. of the Treasury, Div. of Taxation, 363 N.J. Super. 96, 104 (App. Div. 2003); Estate of Pelligra v. Dir., Div. of Taxation, 23 N.J. Tax 658, 662 (Tax 2008).
Rule 8:4-1(b) provides that complaints seeking to review the Director's actions "with respect to a tax matter . . . shall be filed within 90 days after the date of the action to be reviewed," mirroring the language of N.J.S.A. 54:51A-14. With respect to the calculation of the ninety days, Rule 8:4-2(a) provides: "[t]he time period shall be calculated from the date of service of the decision or notice of the action taken."If service is made by both certified mail and ordinary mail but is not "made simultaneously and the addressee accepts the certified ... mail, [then] service shall be deemed complete on the date of acceptance." Rule 1:5-4(b). However, "[i]f the addressee fails to claim or refuses to accept delivery of certified ... mail, service shall be deemed complete on mailing of the ordinary mail." Rule 1:5-4(b). "When service of a notice or paper is made by ordinary mail, and a rule . allows the party served a period of time after the service thereof within which to take some action, 3 days shall be added to the period." Rule 1:3-3 (emphasis added).
[Liapakis, supra, 363 N.J. Super. 96 at 106-107 (emphasis omitted).]
There is no plausible scenario in which the taxpayer's complaint was timely filed. Because there is no "timely mailed, timely filed" rule in New Jersey, the complaint was filed when received and stamped by the Tax Court on Friday, August 9, 2013. If the filing deadline is counted from the date of receipt of the certified mail, i.e. Wednesday, May 8, 2013, 90 days from that date would be Tuesday, August 6, 2013. Assuming arguendo that service via certified mail was ineffective, then the filing deadline would be calculated using the ordinary mail rules: the limitation period would be counted from the date of the notice, Monday, May 6, 2013, plus three additional days as allowed by Rule 1:3-3; therefore, the final date for filing the complaint would be Wednesday, August 7, 2013. Although not set forth in any court rule, even if the 90 day period were to begin on Friday, May 10, 2013, which was the date the taxpayer's attorney received a copy of the Final Determination, the court only gets to Thursday, August 8, 2013. In any event, the taxpayer's complaint is untimely.
The taxpayer argued that only Mr. Lombardo was authorized to accept the certified letter. Certified mail, particularly in a business context, is often accepted and signed for by an individual other than the addressee. If the letter had been sent restricted delivery, then only the addressee or an agent could have accepted the letter. See United States Postal Service, Domestic Mail Manual § 503.8.3.1 (Mar. 3, 2014). However, given that the Final Determination was not sent restricted delivery and was sent to an address where Mr. Lombardo's mother was living, it appears that she was authorized to accept mail at that address. The taxpayer also argued the limitation period should begin when Mr. Lombardo was in actual possession of the Final Determination. That scenario is not contemplated by any statute or court rule.
The taxpayer's principal argument at the November 8 hearing was that Rule 1:3-3 added three days to the limitation period upon the receipt of either certified mail or ordinary mail. As indicated above, Rule 1:3-3 only applies to ordinary mail, and service via ordinary mail is deemed complete on mailing, not receipt.
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Although this court may toll jurisdictional statutes in limited circumstances, particularly "if the legislative purpose underlying the statutory scheme will thereby be effectuated," see, e.g., Prospect Hill Apartments v. Borough of Flemington, 1 N.J. Tax 224, 227 (Tax 1979) (quoting White v. Violent Crimes Comp. Bd., 76 N.J. 368, 379 (1978)), those circumstances are not present here. The taxpayer was in physical possession of the Final Determination for most if not all of the limitation period and yet waited until the last moment to file a complaint. Although the delay was related, in part, to ongoing settlement negotiations in an attempt to resolve this matter, that is not a sufficient reason to toll the statute of limitations.
Accordingly, because the taxpayer's complaint was filed out of time, this court lacks jurisdiction to hear the case. The case is DISMISSED.
Very truly yours,
Hon. Vito L. Bianco, J.T.C. VLB/WIO:tms