Delaney v. Testa

• Decision Date: 15 February 2011
• Docket Number: No. 2010–0653.,2010–0653.
• Citation: 943 N.E.2d 546,128 Ohio St.3d 248
• Parties: DELANEY, Aud., Appellant,v.TESTA, Tax Commr., et al., Appellees.
• Court: Ohio Supreme Court

128 Ohio St.3d 248

943 N.E.2d 546

2011 -Ohio- 550

DELANEY, Aud., Appellant,

v.TESTA, Tax Commr., et al., Appellees.

No. 2010–0653.

Supreme Court of Ohio.

Submitted Feb. 2, 2011.Decided Feb. 15, 2011.

Stephen K. Haller, Greene County Prosecuting Attorney, and Elizabeth Ellis and Susan L. Goldie, Assistant Prosecuting Attorneys, Xenia, OH, for appellant.Michael DeWine, Attorney General, and Barton A. Hubbard, Assistant Attorney General, for appellee Joseph W. Testa.Vorys, Sater, Seymour & Pease, L.L.P., Raymond D. Anderson, and Hilary J. Houston, Columbus, OH, for appellee Waste Management of Ohio, Inc.PER CURIAM.

Per Curiam.

[Ohio St.3d 248] {¶ 1} In this personal-property-tax case, Greene County Auditor Luwanna Delaney appealed to the Board of Tax Appeals (“BTA”) from final assessment certificates issued by the tax commissioner against Waste Management of Ohio, [Ohio St.3d 249] Inc., pertaining to tax years 1998 and 1999. The BTA dismissed the appeal for want of jurisdiction because it found that Delaney had not set forth any error in the notice of appeal with the specificity required by R.C. 5717.02.

{¶ 2} On appeal to this court, Delaney does not contest the BTA's determination that the notice of appeal lacked specificity under the usual standard derived from R.C. 5717.02 and articulated by the case law. Instead, Delaney contends that in this situation, the usual specification requirement is either modified or superseded by the Due Process Clause of the Fourteenth Amendment to the United States Constitution and the due-course-of-law provision at Section 16, Article I of the Ohio Constitution. The auditor argues that because she was not a participant in the proceedings initiated by the taxpayer's petition for reassessment, she had insufficient knowledge about the commissioner's final determination to assign error with specificity. Enforcing the specification requirement with ordinary stringency, Delaney argues, would effectively deprive her of the right to appeal, a due-process violation.

{¶ 3} As an initial matter, we hold that under the ordinary statutory standard, the BTA acted reasonably and lawfully in finding that Delaney's notice of appeal failed to set forth any error of the commissioner with sufficient specificity. It follows that unless Delaney can establish a constitutional basis for avoiding or relaxing the specification requirement, we must affirm the BTA's decision dismissing the appeal.

{¶ 4} As for Delaney's primary contention that the specification requirement violates her right to due process, we note that a public official's right to participate in tax-assessment proceedings exists not by constitutional right but by legislative grant. As a result, Delaney is bound by the conditions that the statutes impose on that grant—in this case, the specification requirement of R.C. 5717.02. Although the statutes prescribe complementary duties for the commissioner and the county auditors, and thereby contemplate a cooperative relationship between those officials, Delaney does not allege that she attempted to participate in the assessment at issue but was denied an opportunity to do so. Absent a thwarted attempt, Delaney lacks any substantive basis for claiming a violation of due process.

{¶ 5} Delaney also argues that the assessment certificates constitute a taking of property of the citizens of Greene County without due process. Because this alleged unconstitutional taking was not specified as error in the notice of appeal to the BTA, we have no jurisdiction over this claim.

{¶ 6} Because we hold that the cited constitutional provisions did not release Delaney from the obligation to specify error in the notice of appeal to the BTA, and because the BTA's decision is otherwise reasonable and lawful, we affirm the BTA's dismissal of the auditor's appeal.

[Ohio St.3d 250] I. Facts

{¶ 7} Underlying the present appeal are final assessment certificates issued by the tax commissioner against Waste Management of Ohio, Inc., for the 1998 and 1999 tax years. Waste Management filed intercounty property tax returns for those years, and for each of those years, Waste Management reported ownership of personal property that it used in its business in several taxing districts of Greene County. The tax commissioner amended the assessment and issued correction notices. For both tax years 1998 and 1999, the commissioner added to the assessed value for taxing districts in Greene County. In particular, the commissioner increased the value listed on Schedule 4 for the Bath Township/Fairborn City School District by $714,190 (1998) and $702,150 (1999).¹

{¶ 8} On September 15, 2000, Waste Management filed its petition for reassessment contesting the tax commissioner's amendments for tax year 1998, and subsequently filed its petition for reassessment for the 1999 tax year on October 12, 2001. One of Waste Management's two principal objections concerned the taxation of “vehicle add-on equipment.” After further proceedings, the commissioner issued his final determinations in the cases on January 9, 2004.

{¶ 9} The determinations reveal that the major source of dispute between the taxpayer and the commissioner lay in the applicability of the general personal property tax to certain equipment mounted on waste-disposal trucks owned and operated by Waste Management. Registered motor vehicles are exempt from personal property tax, see R.C. 5701.03(A), and Waste Management apparently contended that the equipment was integrated with the trucks and was therefore exempt as part of a registered motor vehicle. The commissioner opined that the equipment, although mounted on trucks, was taxable personal property used in business that was not part of the trucks themselves.

{¶ 10} On January 14, 2005, the BTA granted an unopposed motion filed by Waste Management and entered an order staying the proceedings pending the BTA's decision in Rumpke Waste, Inc. v. Wilkins, BTA No. 2004–P–477, and Rumpke Recycling, Inc. v. Wilkins, BTA Nos. 2004–P–478 and 2004–P–479. Waste Mgt. of Ohio, Inc. v. Wilkins (Jan. 14 2005), BTA Nos. 2004–V–252 and 2004–V–253, 2005 WL 176630. Grounds for the stay lay in the representation that the Rumpke cases “involve[d] the same principal issue regarding waste [Ohio St.3d 251] hauling trucks and whether said equipment [was] excluded from the definition of personal property under R.C. 5701.03(A).” Id. at *1.

{¶ 11} On March 30, 2007, the BTA issued a decision in one of the Rumpke cases. Rumpke Waste, Inc. v. Wilkins (Mar. 30, 2007), BTA Nos. 2004–K–477 and 2004–K–479, 2007 WL 1028518. In that decision, the BTA held that the test articulated by the court in Parisi Transp. Co. v. Wilkins, 102 Ohio St.3d 278, 2004-Ohio-2952, 809 N.E.2d 1126, dictated that in the context of Rumpke, the front forks and arms, along with the hoist systems, did not constitute part of the trucks, because they were used to load waste material onto the trucks. Rumpke at *7. By contrast, the packing blades, slide panels, and tailgate units were necessary in transporting the waste material and therefore qualified for exemption because they were components of the trucks under the Parisi test as applied by the BTA. Id.

{¶ 12} On June 15, 2007, the BTA issued an order lifting the stay in the Waste Management cases and setting them for hearing. Waste Mgt., Inc. v. Wilkins (June 15, 2007), BTA Nos. 2004–V–252 and 2004–V–253, 2007 WL 1814352. On April 1, 2008, the BTA issued an order granting the joint motion of the parties to remand the cases to the commissioner for further consideration.

{¶ 13} On October 9, 2009, the commissioner issued the final assessment certificates for 1998 and 1999.² Delaney's notice of appeal includes two pages showing a reduction of the assessed value in the Bath Township/Fairborn City Schools taxing district of $89,660 (1998) and $289,800 (1999). Postulating that the final assessment entitles Waste Management to refunds, the notice characterizes any refunds as “unreasonable and unwarranted” and states that “the business is closed and nonexistent.” The BTA found that these assertions did not specify error under R.C. 5717.02 and dismissed the auditor's appeal. Delaney timely appealed to this court.

II. Analysis

A. The auditor's notice of appeal to the BTA failed to set forth error with the specificity required by R.C. 5717.02

{¶ 14} In DeWeese v. Zaino, 100 Ohio St.3d 324, 2003-Ohio-6502, 800 N.E.2d 1, we held that “[i]n order to invoke the jurisdiction of the BTA, the [county] [Ohio St.3d 252] auditors must comply with the requirements of R.C. 5717.02.” Id., ¶ 19. Subsequently, in Brown v. Levin, 119 Ohio St.3d 335, 2008-Ohio-4081, 894 N.E.2d 35, we canvassed the case law concerning R.C. 5717.02's requirement that a taxpayer who appeals a final determination of the tax commissioner to the BTA “specify the errors therein complained of.” Id. ¶ 17–19. One principle established by the cases was that “the failure to set forth any error in the notice of appeal with the requisite specificity justifies the dismissal of the appeal by the BTA for want of jurisdiction.” (Emphasis sic.) Id. at ¶ 17. Under that precept, the BTA ruled in the present case that the Greene County auditor had failed to specify any error and that her attempted appeal should therefore be dismissed.

{¶ 15} In reviewing the BTA's decision, we note the relevance of another principle established by the case law, as explained in Brown at ¶ 18: the specification requirement is “stringent.” ³ In the present case, the Greene County auditor faulted the final assessments issued by the tax commissioner by stating that “the refunders [sic] are unreasonable and unwarranted, and furthermore * * * the business is closed and nonexistent.” We will analyze this statement as consisting of two separate, though not necessarily unrelated, assertions. See Ohio Bell Tel. Co. v. Levin, 124 Ohio St.3d 211, 2009-Ohio-6189, 921 N.E.2d 212, ¶ 21.

{¶ 16} First, the assertion...