Appeal of Township of Monroe from Determination of Local Finance Bd.

Decision Date19 December 1995
Citation673 A.2d 279,289 N.J.Super. 138
PartiesIn re Appeal of TOWNSHIP OF MONROE FROM DETERMINATION OF LOCAL FINANCE BOARD.
CourtNew Jersey Superior Court — Appellate Division

Joel L. Shain, Bernardsville, for appellant Township of Monroe (Shain, Schaffer & Rafanello, attorneys; Mr. Shain, on the briefs; Joyce Wilkins-Pollison, also on the brief; F. Clifford Gibbons, on the reply brief).

Daniel P. Reynolds, Deputy Attorney General, for respondent Local Finance Board (Deborah T. Poritz, Attorney General, attorney; Joseph L. Yannotti, Assistant Attorney General, of counsel; Mr. Reynolds, on the brief).

Before Judges PETRELLA, SKILLMAN 1 and P.G. LEVY.

The opinion of the court was delivered by

PETRELLA, P.J.A.D.

The Township of Monroe appeals from the decision of the Local Finance Board, Division of Local Finance in the Department of Community Affairs (Board), upholding an August 23, 1994 joint letter order of the Director of the Division of Local Government Services and the Assistant Director of the Division of Taxation. The order directed Monroe Township "to take no action to issue checks or other credits to property owners affected by" Monroe Township's July 6, 1994 tax abatement resolution. That resolution provided certain homeowners in Monroe Township with a partial abatement on their 1994 real estate taxes. 2 The resolution purportedly was adopted by Monroe Township pursuant to the authority in N.J.S.A. 54:4-99 and 100.

The owners of certain types of condominium units in a planned retirement community located in Monroe Township had objected to their 1994 property tax assessments as discriminatory. They informed Monroe Township that prior to April 1, 1994, their representatives had discussed their concerns with Monroe Township's tax assessor, who assertedly had assured them that their property tax assessments for 1994 would be reduced. Apparently relying on that assurance, the property owners did not file tax appeals for 1994. Monroe Township's tax assessor denied that she had made such an assurance.

Monroe Township responded to the taxpayers' pleas by adopting a July 6, 1994 resolution approving a property tax abatement program 3 for those taxpayers under N.J.S.A. 54:4-99 and 100. The resolution recited in part WHEREAS, the Assessor, although denying she agreed to reduce the assessments of the Lexington and Laurel units for the tax year 1994, recognizes that if she had reconsidered the full and fair value of the Lexington and Laurel units prior to the April 1st filing deadline she would have reduced the 1994 assessments as reflected on exhibit A attached hereto and made a part hereof....

In the joint letter order from the Division of Local Government Services and the Division of Taxation, the State took the position that N.J.S.A. 54:4-99 and 100 only applied in instances where there were illegal assessments or where "past due taxes" were due and owing and that neither situation existed here. Accordingly, the abatements were ordered to be withheld.

Monroe Township then appealed the joint order to the Board. In reaching its decision to uphold the order, the Board relied on its statutory authority to supervise and regulate the financial activities of local governments. It concluded that the Director's order was proper because Monroe Township had circumvented the statutory procedures for challenging property tax assessments by unlawfully using the cited statutory sections.

Monroe Township argues that the Board lacked jurisdiction over local government tax abatement matters. It also argues that it had authority under N.J.S.A. 54:4-99 and 100 to adopt the tax abatement resolution because the assessor's failure to reduce the 1994 assessments rendered them "illegal," and therefore, it was refunding "past due," "illegal" taxes.

I.

When an agency interprets a statute, the appellate court is in no way bound by the agency's interpretation. Greenwood v. State Police Training Ctr., 127 N.J. 500, 513, 606 A.2d 336 (1992). Monroe Township, through its own action, attempted to cure what it considered an improper act of the tax assessor, and in so doing, Monroe Township effectively circumvented the tax appeal process and overstepped its statutory authority. Hence, the Board acted within its statutory authority and responsibility to supervise and regulate the financial affairs of local governments when it affirmed the joint order directing Monroe Township not to execute the resolution. See N.J.S.A. 52:27BB-6, -8 and -10.

Monroe Township's actions effectively circumvented the tax appeal process. The usual chain of authority and appeal from the tax assessor's action is not through the local governing body, but rather through the county tax board, the state Division of Taxation, and through the court system, starting with the Tax Court. 4 See West Milford Tp. v. Van Decker, 235 N.J.Super. 1, 7, 561 A.2d 607 (App.Div.1989), aff'd, 120 N.J. 354, 576 A.2d 881 (1990); Arace v. Irvington, 75 N.J.Super. 258, 268, 183 A.2d 104 (Law Div.1962); see also Jeffers v. City of Jersey City, 8 N.J.Tax 313 (Law Div.1986), aff'd, 214 N.J.Super. 584, 520 A.2d 797 (App.Div.1987).

Even if the governing body in this case attempted to do what it perceived to have been equity, it cannot reduce taxes for certain taxpayers on an ad hoc basis through the application of the abatement procedures in N.J.S.A. 54:4-99 and 100. The assessment procedure and the appeal mechanism clearly is defined under the statute. The governing body has no direct role in that procedure, except in certain cases to approve a settlement of a tax appeal. Monroe Township's reliance on concepts of tax abatement cannot be used to subvert the normal tax assessment appeals. The improper nature of the abatements is particularly clear when it is considered that the individual amounts of the abatements for each unit were fixed on projected reduced assessment values.

N.J.S.A. 54:3-21 provides the process by which appeals of tax assessments are to be taken. That section also provides a filing deadline, and any extensions thereof are very limited. N.J.S.A. 54:3-21, 54:3-21.4, 54:3-21.5; Lawrenceville Garden Apt. v. Lawrence Tp., 14 N.J.Tax 285 (App.Div.1994). Filing deadlines for tax appeals have been strictly construed. See Lawrenceville, supra; St. Michael's Passionist Monastery v. Union City, 5 N.J.Tax 415 (Tax 1983), remanded on other grounds, 195 N.J.Super. 608, 481 A.2d 304 (App.Div.1984). Meeting the statutory filing requirements is considered an "unqualified jurisdictional imperative...." St. Michael's Passionist Monastery v. Union City, supra, 5 N.J.Tax at 418 (citations omitted). Failure to meet these filing deadlines is a "fatal jurisdictional defect." Ibid.

Under N.J.S.A. 54:4-64, "every taxpayer is put on notice to ascertain from the proper official of the taxing district the amount which may be due for taxes or assessments against him or his property." Although the property owners in this case allegedly were "assured" by the assessor that their taxes would be reduced, they did not follow-up or determine whether such a reduction had been made prior to the filing deadline for tax appeals. The property owners are charged with an affirmative duty by the cited statute to seek out their tax assessments. See St. Michael's Passionist Monastery v. Union City, supra, 5 N.J.Tax at 418-419. Their failure to do so by the filing deadline must be considered a result of their own inaction. Missing the filing date under these circumstances would not justify extending the deadline under N.J.S.A. 54:3-21, 54:3-21.4, and 54:3-21.5. Hence, Monroe Township's abatement resolution, effectively providing certain property owners with relief when the ordinary statutory appeals method would not have done so because it was not timely used, circumvents the statutory scheme for obtaining tax relief and the Legislature's intent to have appeals governed under the specified procedure.

Even assuming that the tax assessor undertook to reduce the assessments of certain taxpayers, a disputed fact, the taxpayers are not relieved of their obligation to make sure that appropriate action was taken or that an order for a corrective assessment was issued by the assessor and filed with the county tax board. Nor did it relieve the condominium owners from filing a timely- appeal if the assessor had not taken any action. 5 See St. Michael's Passionist Monastery v. Union City, supra, 5 N.J.Tax at 418-419.

If it were shown that the taxpayer had legal justification for relying on statements made by the assessor, then failing to meet a statutory filing deadline might not be an absolute bar. Id. at 418. In essence, such a taxpayer would be arguing that the local governing body would be "estopped, on equitable grounds, from asserting a jurisdictional bar" to the right to have assessments reviewed by the court. Ibid. The doctrine of estoppel, however, is not readily employed, particularly in matters of taxation, where the public interest is affected so vitally. To successfully employ estoppel against a taxing authority "the circumstances must be extreme." Ibid. However, a "taxing authority is not bound or estopped by the unauthorized acts of its officers." Id. at 419 (citing Bayonne v. Murphy & Perrett Co., 7 N.J. 298, 81 A.2d 485 (1951); Airwork Serv. Div. v. Taxation Div. Director, 2 N.J.Tax 329 (Tax 1981), aff'd, 4 N.J.Tax 532 (App.Div.1982), aff'd, 97 N.J. 290, 478 A.2d 729 (1984), cert. denied, 471 U.S. 1127, 105 S.Ct. 2662, 86 L.Ed.2d 278 (1985)).

The property owners affected by Monroe Township's resolution in this case had convinced the governing body that they failed to meet the deadline because they justly relied upon the assessor's alleged "assurance" that their assessments would be adjusted. Reliance under such a situation does not meet the requirements for allowing a late filing under the doctrine of estoppel. See St. Michael's Passionist Monastery v....

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