5K Farms, Inc. v. Mississippi Dep't of Revenue
| Decision Date | 10 May 2012 |
| Docket Number | NO. 2009-CT-01787-SCT,2009-CT-01787-SCT |
| Parties | 5K FARMS, INC. v. MISSISSIPPI DEPARTMENT OF RE VENUE f/k/a MISSISSIPPI STATE TAX COMMISSION |
| Court | Mississippi Supreme Court |
EN BANC.
¶1. We granted certiorari in this matter to address the specific question of whether the requirement to post a pretrial bond set out in Mississippi Code Sections 27-77-5 and 27-77-7 (Rev. 2005) is procedural or jurisdictional. If procedural, it would constitute an intrusion by the Legislature into the assigned powers of this Court and of the judicial branch of government, and a violation of Article 6, Sections 144 and 146 of the Mississippi Constitution. Having considered the issue, we find that this Court's precedent is clear. Therequirement of a pretrial bond relates to appellate jurisdiction and is within the powers of the Legislature. Accordingly, we affirm the judgments of the Court of Appeals and of the Chancery Court for the First Judicial District of Hinds County.
¶2. 5K Farms, Inc. (5K Farms) is a newly formed blueberry farm, which produced its first saleable crop in 2009. On October 5, 2005, following Hurricane Katrina, the Mississippi Department of Environmental Quality (MDEQ) granted emergency authorization to 5K Farms to accept and dispose of vegetative debris generated as a result of that storm. 5K Farms used this vegetative debris for agricultural development.
¶3. On February 8, 2006, the MDEQ notified 5K Farms by means of a memorandum that all sites for which emergency authorization was granted for the disposal of vegetative debris would be considered commercial disposal sites subject to reporting requirements on solid-waste-disposal activities. In the same memorandum, 5K Farms was notified that it was required to file a report with the Mississippi State Tax Commission (MSTC), now known as the Mississippi Department of Revenue (MDR), showing the total amount of vegetative debris it had received. 5K Farms was ordered to pay a fee on the debris in the amount of one dollar per ton.
¶4. 5K Farms sought further instruction from the MSTC, which determined that 5K Farms was a commercial disposal site and, as a result, found it to be subject to the fee. In June, 2007, 5K Farms filed a solid-waste-fee annual report for the period between February 10, 2006, and May 4, 2006. 5K Farms reported, in total, the disposal of 133,133 tons of solid waste.
¶5. In March 2008, the MSTC notified 5K Farms that it had been assessed $157,096.94, a sum which included the fee of one dollar per ton on 133,133 tons of waste, as well as interest and penalties. 5K Farms appealed this assessment to the MSTC Board of Review. 5K Farms argued in its appeal that it did not operate a disposal site, but rather, only used the debris to develop the land for the planting of blueberries. The Board of Review found that 5K Farms was notified in February 2006 of its potential liability and upheld the MSTC's assessment. 5K Farms then appealed this ruling to the full Commission.
¶6. The Commission determined that 5K Farms was indeed a commercial nonhazardous solid-waste-management facility, and that it was thus subject to the fee of one dollar per ton. 5K Farms had argued that the land used to develop the farm was part of a land-reclamation project. Although 5K Farms argued that its use of the land was beneficial, the Commission found no exemption in the law on that basis. The Commission upheld the assessment of fees incurred during 2006. But the assessment was reduced to $133,133, equivalent to the rate of one dollar per ton of waste used, without an assessment for interest or penalties.
¶7. 5K Farms filed an appeal in the Chancery Court for the First Judicial District of Hinds County. At the same time, 5K Farms filed a motion for supersedeas, requesting that the chancery court enter an order allowing 5K Farms to proceed without posting a bond as required under Mississippi Code Sections 27-77-5 and 27-77-7 (Rev. 2005). These statutes have since been revised. Section 27-77-5 (7), as it appeared in 2005, stated:
If in its order the commission orders a taxpayer to pay a tax assessment, the taxpayer shall, within thirty (30) days from the date of the order, pay the amount ordered to be paid or properly appeal said order of the commission to chancery court as provided in Section 27-77-7. After the thirty day period, if the tax determined by the commission to be due is not paid and an appeal fromthe commission order has not been properly filed, the agency shall proceed to collect the tax assessment as affirmed by the commission. . . .
Section 27-77-7, as it appeared at the time, stated, in pertinent part, that:
Miss. Code Ann. § 27-77-7 (1) and (3) (Rev. 2005). The motion also requested that the chancellor prevent any collection proceedings against 5K Farms during the pendency of the case. 5K Farms attached to its motion a pauper's affidavit signed by its vice president, David Kittrell. This affidavit asserted that 5K Farms, as a new farming operation, did not have the money to pay the required bond or the assessment.
¶8. The MSTC filed a motion to dismiss the appeal and objected to 5K Farms' motion for supersedeas. After a hearing on the matter, the chancellor determined that 5K Farms could not proceed with the appeal as an indigent party. 5K Farms was granted no relief from the requirement to post the proper bond. The chancellor entered an order dismissing the case for lack of subject-matter jurisdiction. 5K Farms then appealed the issue to this Court and we assigned the case to the Court of Appeals.
¶9. On appeal, 5K Farms asserted the following issues: (1) whether the chancery court had jurisdiction to hear the appeal; (2) whether 5K Farms was entitled to appeal as a pauper;(3) whether 5K Farms' failure to post a bond or pay the tax as required by law was a defect of form such that it was curable; and (4) whether the Legislature's statutory imposition of a bond or prepayment of a contested tax assessment violated 5K Farms' due-process rights. 5K Farms, Inc. v. Miss. State Tax Comm'n, 2011 WL 880401, *1 (¶7) (Miss. Ct. App. March 15, 2011). Finding no merit in any of these issues, the Court of Appeals affirmed the judgment of the chancery court. Id. at **2-4 (¶¶9-15).
¶10. This Court granted certiorari solely to review whether the pretrial bond requirement found in Mississippi Code Sections 27-77-5 and 27-77-7 (Rev. 2005) relates to appellate jurisdiction and is constitutional, or is procedural and unconstitutional. Arcadia Farms Partnership v. Audubon Ins. Co., 77 So. 3d 100, 104 (Miss. 2012) (). 5K Farms challenged the constitutionality of these statutes before the Court of Appeals in its due-process claim. However, that Court determined that the matter had not been ruled upon by the chancery court, and therefore was beyond the review of an appellate court. 5K Farms, Inc. v. Miss. State Tax Comm'n, 2011 WL 880401, *3 (¶14) (Miss. Ct. App. March 15, 2011) (citing Barnes v. Singing River Hosp. Sys., 733 So. 2d 199, 202-03 (Miss. 1999)).
¶11. Furthermore, the Court of Appeals' majority noted that Mississippi Rule of Appellate Procedure 44(a) required service of any appellate brief challenging the validity of a statute 5K Farms, 2011 WL 880401, at *3 (¶14). The exceptionis that "by special order of the court to which the case is assigned, in the absence of such notice neither the Supreme Court nor the Court of Appeals will decide the question until the notice and right to respond contemplated by this rule has been given to the appropriate governmental body." M.R.A.P. 44(c).
¶12. Since 5K Farms did not provide notice to the Attorney General that it was challenging the constitutionality of the statute, as required under Mississippi Rule of Appellate Procedure 44(a), the Court of Appeals took an appropriate course of action in not addressing the issue, and this Court could well have done the same. The general rule is that we will not address issues raised for the first time on appeal, particularly where constitutional questions are concerned. See, e.g., Mabus v. Mabus, 890 So. 2d 806, 811 (Miss. 2003); Stockstill v. State, 854 So. 2d 1017, 1023 (Miss. 2003).
¶13. Instead, viewing this jurisdictional issue as worthy of consideration, we proceeded by issuing a special order as allowed under Mississippi Rule of Appellate Procedure 44(c). See Patterson v. State, 594 So. 2d 606, 609 (Miss. 1992) (quoting Colburn v. State, 431 So. 2d 1111, 1114 (Miss. 1983)) ("matters of jurisdiction may be raised for the first time on appeal."). By order entered on November 28, 2011, this Court provided notice to the Attorney General and requested supplemental...
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