Gilday & Assocs. v. Marion Cnty. Assessor, 21T-TA-00002

Citation21T-TA-00002
Case DateSeptember 15, 2021
CourtTax Court of Indiana

GILDAY & ASSOCIATES, P.C., Petitioner,
v.

MARION COUNTY ASSESSOR, Respondent.

No. 21T-TA-00002

Tax Court of Indiana

September 15, 2021


ON APPEAL FROM A FINAL DETERMINATION OF THE INDIANA BOARD OF TAX REVIEW

ATTORNEY FOR PETITIONER: JAMES K. GILDAY GILDAY & ASSOCIATES, P.C.

ATTORNEY FOR RESPONDENT: JESSICA R. GASTINEAU

WENTWORTH, J.

Gilday & Associates, P.C. ("Gilday") challenges the Indiana Board of Tax Review's final determination that dismissed its administrative appeals for lack of standing to claim a property tax refund for the 2014 through 2017 tax years. Upon review, the Court reverses the Indiana Board's final determination.

FACTS AND PROCEDURAL HISTORY

The subject property is a single-family residence located on Coral Reef Way in Lawrence Township, Marion County, Indiana. (See Cert. Admin. R. at 1-5.) During the years at issue, the property was owned by Paul Terry Batties, who used it exclusively as his personal residence. (See Cert. Admin. R. at 3-4.) At some point, Batties entered into a residential mortgage loan transaction with Green Tree Servicing, LLC, and an escrow account was established from which the property taxes were to be paid. (See Cert. Admin. R. at 4, 10.)

Batties became delinquent on the loan during the years at issue. (See Cert. Admin. R. at 4.) Green Tree, however, advanced the payment of the property taxes on Batties' property throughout the delinquency period. (See Cert. Admin. R. at 4, 10.) During that period, the property's Homestead Deduction was "inexplicably" removed even though the property had received the Homestead Deduction for the preceding years. (See Cert. Admin. R. at 4, 10.) See also, e.g., Ind. Code § 6-1.1-12-37(b)-(c) (2021) (providing that an eligible homestead may receive a standard deduction annually up to $45, 000 from the assessed value of the homestead).

In the meantime, Green Tree filed a complaint for foreclosure on the property in the Marion County Superior Court and eventually "obtained a mortgage foreclosure judgment that included all of the [property] taxes that it had advanced on behalf of [] Batties." (See Cert. Admin. R. at 4.) Thereafter, in July of 2018, Gilday purchased the subject property at a sheriff's sale for $375, 000. (See Cert. Admin. R. at 4, 10.) The purchase price included the amount of Green Tree's mortgage foreclosure judgment (i.e., $280, 467.86). (See Cert. Admin. R. at 4, 10.)

Believing that it had paid all the property taxes for the years at issue by virtue of its payment to the Marion County Sheriff, Gilday filed four "Notice[s] to Initiate an Appeal" ("Form 130s") with the Marion County Assessor on November 13, 2018. (See, e.g., Cert. Admin. R. at 6-16.) In the Form 130s, Gilday claimed it was entitled to a partial refund of its property tax payments because the property should have received Homestead Deductions during the years at issue. (See, e.g., Cert. Admin. R. at 10.) On December 14, 2018, the Marion County Property Tax Assessment Board of Appeals (the "PTABOA") denied all of the Form 130s. (See, e.g., Cert. Admin. R. at 17-18.)

On January 28, 2019, Gilday sought review with the Indiana Board by filing four "Petition[s] for Review of Assessment" ("Form 131s"). (See, e.g., Cert. Admin. R. 1-5.) Several months later, Gilday filed a "Motion for Leave to Propound, to the Extent Necessary, More Than Twenty-five (25) Interrogatories" and the Assessor moved to quash two non-party subpoenas duces tecum. (See Cert. Admin. R. at 81-88, 93-163.)

In his motion to quash, the Assessor explained that he intended to file a motion to dismiss because Gilday had failed to state a claim upon which relief may be granted. (See Cert. Admin. R. at 131-32.) Given the Assessor's representations, the Indiana Board ordered the Assessor to file a motion to dismiss, and advised the parties that their discovery motions would be held under advisement. (See Cert. Admin. R. at 221.) On November 1, 2019, the Assessor filed his motion to dismiss, asserting that Gilday's appeals should be dismissed because 1) the removal of the Homestead Deductions was correct as a matter of law, 2) Gilday failed to apply for a Homestead Deduction within the statutorily prescribed period, and 3) Gilday had used the wrong appeal procedure to challenge the removal of the Homestead Deductions. (See Cert. Admin. R. at 222-32.)

Approximately three months later, after Gilday filed a brief in response to the Assessor's motion to dismiss, the Indiana Board issued a "Sua Sponte Motion and Order for Rule to Show Cause" ("Sua Sponte Motion"). (Cert. Admin. R. at 368-69.) In its Sua Sponte Motion, the Indiana Board explained that because Gilday's response brief indicated it neither owned nor had paid the property taxes on the subject property during the years at issue, Gilday needed to establish that it had the statutory right to appeal or its Form 131s would be dismissed. (See Cert. Admin. R. at 368-69.) See also 52 Ind. Admin. Code 2-10-2(b) (2020) (authorizing the Indiana Board to issue an order of dismissal on its own motion) (repealed 2020). In addition, the Indiana Board advised the parties that it would rule on the Assessor's motion to dismiss after resolving the standing issue. (See Cert. Admin. R. at 369.)

In response to the Sua Sponte Motion, Gilday asserted that because the Indiana Board was bound by the Indiana Trial Rule 12(B)(6) standard, it must accept as true the factual allegations in its Form 131s that it was the taxpayer that paid the property taxes for the years at issue by virtue of paying Green Tree's judgment at the sheriff's sale. (See Cert. Admin. R. at 379-84.) As such, Gilday claimed that its appeals were authorized by Indiana Code § 6-1.1-15-1.1 ("Section 15-1.1") and Indiana Code § 6-1.1-26-1.1 ("Section 26-1.1"), which expressly allowed "taxpayers" to appeal to the Indiana Board. (See Cert. Admin. R. at 379, 384-88.)

The Assessor, on the other hand, maintained that the Indiana Board did not need to accept as true Gilday's factual allegations that it was the taxpayer that paid the property taxes on the subject property because those statements were "legal conclusions, requiring an application of law to the facts." (See Cert. Admin. R. at 402-03.) As a result, the Assessor claimed that Gilday's appeals should be dismissed because the facts in its Form 131s showed that Green Tree was the taxpayer, not Gilday. (See Cert. Admin. R. at 403.)

On December 4, 2020, the Indiana Board issued its final determination in the matter. (See Cert. Admin. R. at 449-61.) In that final determination, the Indiana Board explained that it did not need to accept as true the factual allegation that Gilday was the taxpayer that paid the property taxes on the subject property because "[t]he question of whether Gilday [was] a taxpayer within the meaning of the appeal statutes [was] a mixed question of fact and law." (See Cert. Admin. R. at 455 ¶ 15.) Upon interpreting the word "taxpayer" as used in Section 15-1.1 and examining the language in the sheriff's deed in relation to Section 26-1.1, [1] the Indiana Board further found that neither statute authorized Gilday's appeals to the Indiana Board. (See Cert. Admin. R. at 454-57 ¶¶ 14-22.) Accordingly, the Indiana Board dismissed Gilday's appeals for lack of standing. (See Cert. Admin. R. at 460 ¶ 30.)

On January 18, 2021, Gilday initiated this original tax appeal. The Court heard the parties' oral arguments on June 10, 2021. Additional facts will be supplied when necessary.

STANDARD OF REVIEW

The party seeking to reverse an Indiana Board final determination bears the burden of demonstrating its invalidity. Osolo Twp. Assessor v. Elkhart Maple Lane...

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