Castellano v. Kosydar

• Decision Date: 16 April 1975
• Docket Number: No. 74-370,74-370
• Citation: 326 N.E.2d 686,71 O.O.2d 77,42 Ohio St.2d 107
• Parties: , 71 O.O.2d 77 CASTELLANO et al., Appellants, v. KOSYDAR, Tax Commr., Appellee.
• Court: Ohio Supreme Court

Page 107

42 Ohio St.2d 107

326 N.E.2d 686, 71 O.O.2d 77

CASTELLANO et al., Appellants, v. KOSYDAR, Tax Commr., Appellee.

No. 74-370.

Supreme Court of Ohio.

April 16, 1975.

Syllabus by the court

Where an assessment for sales taxes is made pursuant to R.C. 5739.13, and notice of such assessment is served on the vendor or consumer by registered or certified mail, service is effective when the notice is delivered and properly receipted for by an appropriate person at the vendor or consumer's residence, and the 30-day period within which the vendor or consumer must file a petition objecting to such assessment begins to run from that date. (Paragraph one of the syllabus in State, ex rel. Sherrick, v. Peck, 158 Ohio St. 122, 107 N.E.2d 145, overruled.)

On April 5, 1973, the Tax Commissioner issued an assessment for sales taxes against appellants, Earl and Clarence J. Castellano. On the same day, individual copies of the assessments were sent by certified mail to the home addresses of the appellants. The certified return receipt indicated the copy of the assessment sent to Earl Castellano was received and signed for by his wife on April 6, 1973. A similar receipt also showed that the copy of the assessment mailed to Clarence Castellano was received on April 6, 1973, by his father, who resided at the same address.

The taxpayers, appellants herein, filed a petition for reassessment on May 11, 1973. On May 31, 1973, the Tax Commissioner. appellee herein, dismissed the petition due to taxpayers' failure to file within 30 days after service of the notice of assessment as required by R.C. 5739.13. Appellants then perfected a timely appeal to the Board of Tax Appeals. At a hearing before the board, Earl Castellano stated that he left for New York on March 31, 1973, and did not receive the notice of assessment until his return on April 16, 1973. Clarence testified that his father never gave him the notice, and thus he was unaware of the pending assessment. However, the Board of Tax Appeals determined that the commissioner was correct in dismissing the petition for reassessment, and affirmed that decision.

The cause is now before this court upon appeal as a matter of right.

Mancino, Mancino & Mancino and Paul Mancino, Jr., Cleveland, for appellants.

William J. Brown, Atty. Gen., and John C. Duffy, Jr., Columbus, for appellee.

HERBERT, Justice.

This appeal presents the question of whether the period of time for filing a petition for reassessment, pursuant to R.C. 5739.13, begins to run when service of the notice of assessment is effectuated, or from the date the taxpayer receives actual notice of such assessment.

R.C. 5739.13 provides, in pertinent part:

'In each case the commissioner shall give to the person assessed written notice of such assessment. Such notice may be served upon the person assessed personally or by registered or certified mail. * * *

'* * *

'Unless the vendor or consumer, to whom said notice of assessment is directed, files within thirty days after service thereof * * * said assessment shall become conclusive and the amount thereof shall be due and payable, from the vendor or consumer so assessed, to the treasurer of the state. * * *'

Appellants contend that the issue herein should be resolved consistent with the rationable of the Court of Appeals in Fell v. Bur. of Motor Vehicles (1972), 30 Ohio App.2d 151, 283 N.E.2d 825, where actual notice to the licensee was found to be a condition precedent to suspension of a driver's license under R.C. 4511.191(E). ¹ To reach that conclusion, the Court of Appeals relied upon the mandate of this court in Moore v. Given (1884), 39 Ohio St. 661, in which the second paragraph of the syllabus states '(w)here a statute requires notice of a proceeding, but is silent concerning its form of service, actual notice will alone satisfy such requirement.' In the case at bar, R.C. 5739.13 is not silent concerning the manner of service, but specifically designates registered or certified mail as a means of notifying the taxpayer. ²

R.C. 5739.13 provides for appeal from the notice of assessment, if the taxpayer 'files within thirty days after service thereof.' In deciding whether that time period is to be construed as running from the date when the taxpayer receives actual notice of the assessment, guidance is available from a perusal of how mail service is employed pursuant to the Rules of Civil Procedure, Civ.R. 4.1(1) provides, in part: 'Service of any process shall be by certified mail unless otherwise permitted by these rules.' Service by mail is therefore encouraged and preferred under the Civil Rules, as a party cannot invoke personal or residence service unless he specifically files a written request for such process. ³

The use of mail service, under R.C. 5739.13, is not only preferred under the Civil Rules, it also is consistent with due process and modern service requirements. Such service is reasonably calculated to give notice of the assessment and allow the taxpayer to present his objections. See Mullane v. Central Hanover Bank & Trust Co. (1950), 339 U.S. 306, 314, 70 S.Ct. 652, 94 L.Ed. 865.

It should also be noted that certified mail, under the Rules of Civil Procedure, no longer requires actual service upon the party receiving the notice, but is effective upon certified delivery. Prior to its amendment in 1971, Civ.R. 4.1(1) stated that '* * * if the return receipt shows failure of delivery to the addressee the clerk shall forthwith notify, by mail, the attorney of record * * *.' (Emphasis added.) However, the above-italicized words were subsequently deleted, ⁴ evidencing an intent to avoid the impression that certified mail, to be effective, had to be delivered to and signed by the addressee only. The above considerations, and the recognition that a need for actual notice would be contradictory to modern service requirements, represent persuasive arguments for the rejection of appellants' position.

Finally, there are significant practical problems inherent in the taxpayers' contentions. As pointed out heretofore, R.C. 5739.13 allows for a 30-day period for appeal before the tax assessment becomes conclusive and payable to the state. A requirement of actual notice would permit a taxpayer to evade service and not be liable upon the assessment until such time as the Tax Commissioner could show the requisite notice and passage of the 30-day period. In that situation, the ability of the commissioner to prove actual receipt on a particular day would be elusive at best.

It is our conclusion that where an assessment for sales taxes is made pursuant to R.C. 5739.13, and notice of such assessment is served upon the vendor or consumer by registered or certified mail, service is effective when the notice is delivered and properly receipted for by an appropriate person at the vendor or consumer's residence, and the 30-day period within which the vendor or consumer must file a petition objecting to such assessment begins to run from that date. ⁵ Any language to the contrary in State, ex rel. Sherrick, v. Peck (1952), 158 Ohio St. 122, 107 N.E.2d 145, is disapproved, and the first paragraph of the syllabus of that case is overruled.

The decision of the Board of Tax Appeals is affirmed.

Decision affirmed.

C. WILLIAM O'NEILL, C. J., and CORRIGAN and STERN, JJ., concur.

CELEBREZZE, WILLIAM B. BROWN and PAUL W. BROWN, JJ., dissent.

WILLIAM B. BROWN, Justice (dissenting).

In State, ex rel. Sherrick, v. Peck (1952), 158 Ohio St. 122, 107 N.E.2d 145, this court construed G.C. 5546-9a as requiring actual receipt of notice of assessment by a taxpayer before the 30-day period, in which the taxpayer could file objections to the assessment, began to run. G.C. 5546-9a is, where pertinent, identical ⁶ to R.C. 5739.13.

The rationale requiring actual receipt of notice of a taxation assessment is expressed by the unanimous court in Sherrick, at page 125, 107 N.E.2d at page 147, as follows:

'The problem of construing this statute with respect to the time and manner of serving the notice and filing the petition must be approached realistically. The statute from which the above portion is quoted authorizes the Tax Commissioner to make an assessment against the vendor or consumer 'based upon any information within his possession, or that shall come into his possession.' The notice of...