Kartiganer v. Koenig

• Decision Date: 10 June 1993
• Citation: 599 N.Y.S.2d 312,194 A.D.2d 879
• Parties: In the Matter of Herbert L. KARTIGANER et al., Petitioners, v. Francis R. KOENIG, as Commissioner of the Tax Appeals Tribunal of the State of New York, et al., Respondents.
• Court: New York Supreme Court — Appellate Division

Page 312

599 N.Y.S.2d 312

194 A.D.2d 879

In the Matter of Herbert L. KARTIGANER et al., Petitioners, v. Francis R. KOENIG, as Commissioner of the Tax Appeals Tribunal of the State of New York, et al., Respondents.

Supreme Court, Appellate Division,

Third Department.

June 10, 1993.

Drake, Sommers, Loeb, Tarshis & Catania, P.C. (Stephen J. Gaba, of counsel), Newburgh, for petitioners.

Robert Abrams, Atty. Gen. (Lew A. Millenbach, of counsel), Albany, for Commissioner of Taxation and Finance of the State of New York, respondent.

Before MIKOLL, J.P., and YESAWICH, CREW, MAHONEY and HARVEY, JJ.

CREW, Justice.

Proceeding pursuant to CPLR article 78 (initiated in this court pursuant to Tax Law § 2016) to review a determination of the Tax Appeals Tribunal which sustained a personal income tax assessment imposed under Tax Law article 22.

Petitioner Herbert L. Kartiganer (hereinafter Kartiganer) is the founder and president of a consulting engineering firm presently known as Kartiganer Associates P.C. (hereinafter the firm) located in Orange County. In 1977 or 1978, Kartiganer announced his intention to gradually "phase out" his involvement in the firm over the next 10 years. The record indicates that during this time period, the firm cut back on the services it performed and Kartiganer, inter alia, actively sought to sell the firm to various individuals. In late 1981, Kartiganer and his spouse, petitioner Marjorie N. Kartiganer, purchased a condominium in Boca Raton, Florida, and began residing there.

For the year 1982, petitioners filed State resident and nonresident income tax returns for the periods January 1, 1982 to March 1, 1982 and March 1, 1982 to December 31, 1982, respectively; petitioners also filed State nonresident income tax returns for the years 1983 and 1984. The State Department of Taxation and Finance ultimately issued three notices of deficiency showing additional income tax due by petitioners for the years 1982 through 1984 and, further, denied petitioners' application for a refund based upon their 1982 income tax return. The dispute as to petitioners' tax liability centered upon whether petitioners were domiciled in this State during the relevant time periods.

Following an unsuccessful conciliation conference, a hearing was held before an Administrative Law Judge (hereinafter ALJ), at which Kartiganer was the only witness. The ALJ concluded, inter alia, that petitioners had failed to establish by clear and convincing evidence that they were in fact domiciled in Florida during the relevant time periods and, accordingly, sustained the notices of deficiency issued for 1984 taxes due and the disallowance of petitioners' claim for a refund for 1982. As to the notice of deficiency issued for 1983 taxes due, the ALJ concluded that petitioners' challenge in that regard was untimely. Petitioners filed exceptions to the ALJ's decision. The Tax Appeals Tribunal thereafter denied petitioners' exceptions and affirmed the ALJ's decision. This CPLR article 78 proceeding followed.

The primary issue on review is whether the record supports the determination that petitioners were domiciled in this State during the period 1982 through 1984 (see generally, Matter of Bodfish v. Gallman, 50 A.D.2d 457, 378 N.Y.S.2d 138). During the relevant time period, a "resident" was defined under the Tax Law as an individual "who is domiciled in this state" (Tax Law former § 605[a][1]. "Domicile", in turn, was defined under the pertinent regulations as "the place which an individual intends to be his permanent home--the place to which he intends to return whenever he may be absent" (20 NYCRR former 102.2[d][1].

It is well settled that domicile is established by physical presence in a particular locality coupled with the intent to remain (see, Matter of Newcomb, 192 N.Y. 238, 250, 84 N.E. 950; Matter of Larkin v Herbert, 185 A.D.2d 607, 608, 586 N.Y.S.2d 679; Matter of McKone v. State Tax Commn. of State of N.Y., 111 A.D.2d 1051, 1053, 490 N.Y.S.2d 628, affd 68 N.Y.2d 638, 505 N.Y.S.2d 71, 496 N.E.2d 230). "The test of intent with respect to a purported new domicile has been stated as 'whether the place of habitation is the permanent home of a person, with the range of sentiment, feeling and permanent association with it' " (Matter of Bodfish v. Gallman, supra, 50 A.D.2d at 458, 378 N.Y.S.2d 138, quoting Matter of Bourne, 181 Misc. 238, 246, 41 N.Y.S.2d 336 affd 267 App.Div. 876, 47 N.Y.S.2d 134 affd 293 N.Y. 785, 58 N.E.2d 729; see, Laufer v. Hauge, 140 A.D.2d 671, 672, 528 N.Y.S.2d 878 lv dismissed 72 N.Y.2d 1041, 534 N.Y.S.2d 939, 531 N.E.2d 659 [domicile defined as "one's principal and permanent place of residence where one always intends to return to from wherever one may be temporarily located"]. In determining whether a change in domicile has occurred, no single factor is deemed controlling (see, Matter of Gadway, 123 A.D.2d 83, 85, 510 N.Y.S.2d 737), and the party seeking to establish a change in domicile must do so by clear and convincing evidence (see, Matter of Larkin v. Herbert, supra, 185 A.D.2d at 608, 586 N.Y.S.2d 679; Matter of Gadway, supra, 123 A.D.2d at 85, 510 N.Y.S.2d 737; Matter of Bodfish v. Gallman, supra, 50 A.D.2d at 458, 378 N.Y.S.2d 138).

Here, the record...