Aida Renta Trust v. Department of Revenue
| Decision Date | 01 February 2000 |
| Docket Number | No. 1 CA-CV 98-0389, No. 1 CA-CV 98-0390. |
| Citation | 3 P.3d 1142,197 Ariz. 222 |
| Parties | AIDA RENTA TRUST: AKT Joint Venture; Alchemedes Boulder Creek Limited Partnership; Alta Place Arizona Limited Partnership; Alta Vista Apartments; American First Tax Exempt Mortgage Fund 2 L.P.; Amigon Strategic Investments; Anancosta Apartments, Inc.; Anasazi Terrace Condominiums, U.S. Limited Partnership; Arabian Trails Development Partners; Aram II Investment Company; Arboleda Investment, L.L.C.; Arthur G. Grandlich; Autumn Creek Property Associates, Limited Partnership; AZ Development Partners, a Massachusetts limited partnership; Barnar Associates; Bethany Apartments Limited Partnership; Bigelow Arizona Casa Carranza Limited Liability Company; Bigelow Arizona Corporation; Bigelow Arizona Limited Liability Company; Bigelow Arizona Limited Liability Company II; Bigelow Arizona Limited Liability Company III; BLM LLC; BRE Properties, Inc.; Bruce J. & Shelagh M. Cann Trust; C & LI, L.C.; Canbrook Limited Partnership; Casa Bonita Investments Limited Liability Company; Casabella Associates, an Arizona joint venture partnership; Cedar Meadows, Inc.; Christian Relief Services, an Arizona affordable housing corporation; Cigna Income Realty-I Limited Partnership; Cluster Housing Properties, a California limited partnership; Concord Equities Limited Liability Company; Contessa Investments Limited Liability Company; Country Villas Limited Partnership; CPW Properties Limited Partnership; Creekwood Summit Lake Limited Partners; CS Apartments, L.L.C.; David A. and Patricia M. Alderdice; Del Mar Terrace Apartments; Desert Pines Investment Associates; Dozier, Preissman; El Dorado Arms, Inc.; Empire Partners, L.L.C.; EQR Arizona, L.L.C.; EQR-Bethany Village Vistas, Inc.; EQR-Camellero Vistas, Inc.; ERP Operating Limited Partnership; Evans Withycombe Finance Partnership; Farmstead Mesa Property, L.P.; First Interstate Bank of Arizona Trust; Foothills Shadows Associates Limited Partnership; Frank Lane Italiane; FSA II Hacienda Verde Associates; FSF Quail Point Associates; Gasser Revocable Living Trust & Maxine Gasser Decendent Trust; Good Fellow, Inc.; H & H Enterprises; Hacienda Properties, L.P.; Hamilton Agnew Mather Trust; Hayden Place, L.L.C.; HEF Development, Inc.; Jacques H. and Frances M. Robinson; James T. Szymanski and Mary Ann Szymanski; James Eugene Albert; James G. Boswell Living Trust; JMB Institutional Apartment Limited Partnership; John Henry and Brigid R. Ragland, Co-trustees of The Ragland Revocable Trust; Josam Investment Company; Joshua Tree, a Washington limited partnership; JPI Partners Limited Partnership; La Corrida Apartments Limited Partnership; La Serena Partners I Limited Partnership; Lakeside Village Apartments, L.P.; Lakme Partnership; Las Brisas Associates; Lawrence B. and Geraldine S. Miller; Lincoln Arizona Associates; Lincoln Broadway Village Limited; Los Verdes, L.L.C.; Luke Park Development; Luke Park Development Phase II; Magellan Dobson Springs Limited Partnership; Magellan Emparrado Limited Partnership; Magellan Las Palmas Limited Partnership; Marques Properties, L.L.C.; Maurice Teitelbaum; Meadow Glen Limited Partnership; Melvyn L. & Laraine S. Marcus; Mesa Hidden Village; Mirada Development Corp.; Mountain Vista Partnership; Northern Green Associates; Olive Square Limited Partnership; Orangetree, Inc.; Osage, L.L.C.; Papago Vista Apartments Limited Partnership; Paradise Trails Associates; Parklane Associates, L.P.; Paul V. and Angeline A. Baker; Pebble Creek/Mesa Limited Liability Company; Phoenix Crossroads Apartments Limited; Pimesa Property, L.P.; Pinnacle Holdings, Inc.; Place II Properties; Presidio Joint Venture; Property Trust of America; Quail Holdings, L.L.C.; Residential Property Investors, L.P.; Richard B. and Susan M. Darby; Richard N. Mills; Robert S. and Karen Walker Trust/Gerald R. Neva; Ronald Tate Trust; Roscrea Associates Limited Partnership; Salado Springs Association Limited Partnership; Santa Fe & El Segundo; Scottsdale Foothills Limited Partnership; Scottsdale Park Terrace; Security Capital Pacific Trust Shadow Creek Limited Partnership; Shadow Run Apartments, Inc.; Siegfried C. Ringwald or Mesa Summit, Inc.; Sofistar Limited Partnership; Sun Lakes Marketing Limited Partnership; Sunscape Apartments, a California limited partnership; Sunset Shadows Apartments Limited Partnership; Sycamore Properties, L.L.C.; The Al Angelo Co.; The Damm Partnership; The Nadler Company; Theodore T. and Marie Smith; Thunderbird Gardens Resort, L.L.C.; Toltec Apartments; Towne Center Limited Partnership, a Washington limited partnership; Unum Life Insurance Company of America; Vecwest Tatum Limited Partnership; Village at North Park Associates; Villages Apartments, Inc.; Vista Del Lagos Joint Venture; Wellsford Residential Property Trust; Westside Apartments Limited Partnership; William A. Mead Trust; YF Partners Eastridge Limited Partners; YF Partners La Estancia Limited Partnership; YF Partners, Rancho Sierra Limited Partnership; 324 South Horne Street Associates, L.P.; 777 Investments, Inc., Plaintiffs-Appellees, v. The DEPARTMENT OF REVENUE OF the STATE OF ARIZONA and Maricopa County, Defendants-Appellants. |
| Court | Arizona Court of Appeals |
Helm & Kyle, Ltd. by John D. Helm, Roberta S. Livesay, Thomas A. Walcott, Special Counsel, Tempe, for Defendant-Appellant, Maricopa County.
Janet A. Napolitano, Arizona Attorney General by Frank Boucek, III, Assistant Attorney General, Phoenix, for Defendants-Appellants.
Nearhood Law Offices, PLC by Richard D. Nearhood, James R. Nearhood, Scottsdale, for Plaintiffs-Appellees.
¶ 1 This appeal addresses two issues:
1. Whether Arizona law imposes a "jurisdictional" requirement that a taxpayer pay "under protest" a tax alleged to have been illegally collected before the taxpayer may maintain an action under Arizona Revised Statutes Annotated (A.R.S.) sections 42-11004 and 42-11005 (1998 Special Pamphlet)1 to recover the tax, and
2. Whether a taxing authority violates the Equal Protection Clause2 of the United States Constitution or the Uniformity Clause3 of the Arizona Constitution by making full and unconditional payment of one taxpayer group's refund claims in settlement of a refund action while at the same time contesting the refund claims of a similarly situated taxpayer group in a separate action based on the same legal theory.
We present only as much detail about the facts of these three consolidated cases as is necessary to understand the legal issues.
¶ 2 The taxpayers are apartment building owners and managers who brought three actions for refunds of ad valorem taxes they alleged were imposed and collected on illegally determined real property valuations. In an earlier action, Maricopa County Superior Court Cause No. CV 95-12688, the (Evans-Withycombe case), three other apartment building owners also represented by the taxpayer-appellees' counsel sought refunds of ad valorem taxes for the same tax year on a theory of recovery identical to that asserted by the taxpayer-appellees here. In the Evans-Withycombe case, Maricopa County (the County) settled with the three plaintiffs through an agreement that granted all the relief they had requested, including revaluation of their properties in accordance with their theory of recovery and refunds of the taxes they claimed to have overpaid.
¶ 3 By contrast, the County and the Arizona Department of Revenue (ADOR) actively opposed the taxpayers' claims for relief in the instant litigation. The County moved for summary judgment on the theory that the trial court lacked "jurisdiction" to entertain the taxpayers' refund action under A.R.S. sections 42-11004 and 42-11005. The taxpayers moved for summary judgment on the theory that the doctrine of virtual representation precluded the County and ADOR from opposing their refund claims after having entered into a consent judgment granting other taxpayers relief on legally identical claims. The taxpayers' motion also contended that in view of the earlier settlement agreement, the County's and ADOR's refusal to accede to the taxpayers' demands for relief in this case constituted discrimination in violation of the taxpayers' rights under the Equal Protection Clause of the United States Constitution and the Uniformity Clause of the Arizona Constitution. See U.S. Const. amend. XIV, § 1; see also Ariz. Const. art. 9, § 1.
¶ 4 The trial court granted the taxpayers' motion for summary judgment and denied the County's. Concerning the County's motion for summary judgment, the trial court reasoned:
There is no statutory authority to support the County's position that Plaintiffs' failed to preserve their claim by paying their taxes under protest. Neither A.R.S. § 42-204 nor any other section of the Tax Code requires that property taxes must be paid "under protest" in order to preserve a claim of an illegal assessment. There is no Arizona opinion which has held that a taxpayer's claims under A.R.S. § 42-204 should be dismissed under a common law theory for failure to pay property taxes under protest.
In granting the taxpayers' motion for summary judgment, the trial court reasoned:
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