Maryland-Nat. Capital Park and Planning Commission v. Washington Nat. Arena

Decision Date14 September 1977
Docket NumberMARYLAND-NATIONAL,No. 1278,1278
Citation37 Md.App. 346,377 A.2d 545
CourtCourt of Special Appeals of Maryland

Sanford E. Wool, Silver Spring, for appellant Maryland-National Capital Park and Planning Commission.

Edward G. Neal, Associate County Atty., with whom were James C. Chapin, County Atty., for Prince George's County, Michael O. Connaughton, Deputy County Atty. and David S. Bliden, Associate County Atty., on the brief, for appellant Prince George's County, Maryland.

Francis B. Burch, Atty. Gen. and Ward B. Coe, III, Asst. Atty. Gen., for appellant State of Maryland.

Peter F. O'Malley, Upper Marlboro, with whom were Glenn T. Harrell, Jr. and O'Malley, Miles, Farrington & McCarthy, Upper Marlboro, on the brief, for appellee.

Argued before MORTON, THOMPSON and LISS, JJ.

LISS, Judge.

On August 11, 1971, the Maryland-National Capital Park and Planning Commission (hereafter, "Commission"), as lessor, entered into a lease agreement with Potomac Sports Limited, Lessee, for a parcel of land of approximately fifty acres, known as a part of the "Kuenne tract," located near the interchange of Central Avenue (Maryland Route 214) and the Capital Beltway (Interstate Route 495). On August 1, 1972, Potomac Sports Limited assigned its interest in the lease to the Washington National Arena Limited Partnership (hereafter, "WNA"), the assignment having been approved by the Commission. On August 23, 1972, the Commission and WNA executed an agreement (hereafter, "Shared Park Agreement") for the joint use of an additional ten acres of the Kuenne tract. Title to all the land remained in the name of the Commission.

The stated purpose of the original lease agreement subsequently assigned to WNA was to provide for the construction of a sports arena to furnish major recreational attractions for the citizens of Maryland in particular those residing in Prince George's and Montgomery Counties consistent with the extensive park development program of the Commission. The subsequent Shared Park Agreement gave WNA the right to park automobiles on the ten acre parcel in return for which WNA was required to either pay a sum of money to the Commission for use in a recreational program in the area or, in the alternative, construct certain recreational equipment on the ten acre tract for use when no parking was in progress. WNA met its obligation under this agreement by payment of an agreed sum of money to the Commission.

Pursuant to the lease agreement, WNA erected an arena containing approximately 18,000 seats, which has been in operation since December of 1973 as the Capital Centre. The lease contained a tax clause in Paragraph 6(c) which required the lessee to pay all taxes, including ad valorem real estate taxes, as additional rent. Paragraph 6(c) further provided:

"Lessee shall have the unrestricted right in its name to pursue such administrative and judicial procedures as may be necessary to contest and appeal from the amount of any assessment or valuation, and pay under protest any billing of real estate taxes or assessments, all or part of which are to be borne by the lessee under the terms of this Lease. Lessee further agrees that it will not contest or challenge any determination by the State Assessor that the real estate improvements are subject to real estate taxes; however, in the event that said real estate improvements are determined by the State Assessor not to be subject to real estate taxes, the lessee agrees to pay to lessor an additional annual rental over and above that provided in paragraph 5 of this Lease Agreement in the sum of $325,000.00."

On January 9, 1974, the Supervisor of Assessments for Prince George's County sent to the Commission a notice of assessment of the value of the 50 acre tract (land only ), the subject of the lease, and the 10 acre tract (land only ), the subject of the Shared Park Agreement both tracts being considered together in the notice. The notice of assessment was forwarded to WNA, and on January 28, 1974, a formal letter of protest of the assessment was sent to the Supervisor of Assessments (hereafter, "Supervisor") in which WNA contended that it did not believe that the land was taxable; that there had been improper notification and service of the notice; and further protested the assessed valuation of the land. On February 22, 1974, another notice of assessment was mailed to the Commission, care of Abe Pollin (general partner in WNA), assessing the improvements constructed by WNA on the 50 acre tract. A formal protest of this notice was sent by WNA to the Supervisor arguing that the notice was improper, that the improvements were not taxable, and that the assessed valuation placed upon the improvements was excessive. On November 21, 1974, final notices of assessment were sent by the Supervisor to the Commission, care of Abe Pollin.

Pursuant to Maryland Code (1957, 1975 Repl. Vol.) Art. 81, § 255, WNA filed a timely appeal to the Property Tax Assessment Appeal Board for Prince George's County (hereafter "the Board") in which WNA raised the issues of the taxability of the land and improvements and the accuracy of the valuation of the improvements as determined by the State Assessor. That appeal had been before the Board for more than six months when the Commission filed its bill for declaratory judgment and injunction, which is the subject matter of this appeal. The bill in equity was filed nine days prior to a scheduled hearing before the Board on the issues raised by WNA.

In its bill, the Commission contended that Paragraph 6(c) of the lease between the parties amounted to a waiver and/or estoppel by and against WNA which precluded it from prosecuting an appeal of the Supervisor's determination that the real property improvements known as the Capital Centre were taxable. The Commission did not contend that WNA was not entitled to contest the Supervisor's conclusion that the land was taxable. By the time that the Commission's bill for declaratory relief and injunction came on for hearing in the Circuit Court for Prince George's County (Judge Samuel Meloy, presiding), the Board had already considered the appeal of WNA from the decision of the Supervisor and had reversed his decision, concluding that neither the land nor the improvements were taxable but rather that under the provisions of Art. 81, they were specifically exempt from taxation. The State of Maryland and Prince George's County entered an appeal from that decision which is now pending in the Maryland Tax Court.

Judge Meloy, after hearing argument and considering the memoranda filed by all the parties, reached the conclusion that Paragraph 6(c) of the lease was against public policy in that it would prevent access to the courts by the lessee and would thereby preclude judicial review of an arbitrary, capricious or illegal imposition of tax liability by the Supervisor of Assessments. It is from that conclusion that this appeal was taken. Antagonists in the appeal are the State of Maryland, 1 the Commission, and Prince George's County as appellants and WNA as appellee.

All of the parties have filed excellent briefs and presented cogent arguments concerning the legal effect of Paragraph 6(c) of the lease agreement, but none of them have raised the basic question which must be determined before the substantive issues in this matter may be reached, i. e., the question of the jurisdiction of the Circuit Court of Prince George's County.

Rule 1085 provides, "Where jurisdiction cannot be conferred on the Court by waiver or consent of the parties, a question as to the jurisdiction of the lower court may be raised and decided in this Court whether or not raised or decided in the lower court." Therefore, even though the issue of jurisdiction was not raised or decided below nor briefed and argued before us that issue may be raised sua sponte by this Court under Rule 1085. Wilson v. State, 21 Md.App. 557, 321 A.2d 549 (1974); Moore v. State, 15 Md.App. 396, 291 A.2d 73 (1972). We believe it is necessary for us to raise and determine the issue of jurisdiction in order for this case to be considered in an orderly fashion and to avoid unnecessary and duplicative litigation.

Pursuant to the recommendations of the Tax Revision Commission established under Ch. 687, Acts 1927, the Legislature, by Ch. 226, Acts 1929, made a general revision of the tax laws of Maryland. In so doing, it repealed former Art. 81 and enacted a new Art. 81 of the Maryland Code. The newly adopted article re-enacted substantial portions of the existing laws on taxation and enacted additions and clarifications of that law. The principal purpose of the revision, however, was to "codify and clarify." Meade Heights, Inc. v. State Tax Commission of Maryland, 202 Md. 20, 95 A.2d 280 (1953).

The Article as adopted provided for a series of elaborate hearing and appellate procedures which are available to anyone aggrieved by a tax assessment levied against real and personal property owned in the State of Maryland. Subsection (a) of Art. 81, § 255, Code (1957, 1975 Repl. Vol., 1976 Cum.Supp.) provides:

"With respect to any property assessed locally, any taxpayer, county, or city, or the Attorney General or the State Department of Assessments and Taxation may demand a hearing before the supervisor of assessments or their respectively designated representatives, as to the assessment of any property or any unit of tax value, or as to the increase, reduction, or abatement of any such assessment, or as to the classification, for the next year."

Subsection (b) grants to any taxpayer, county or city, or the Attorney General, or the State Department of Assessments and Taxation on behalf of the State the right to demand a further hearing before the property tax assessment appeal board and a review of the initial determination by the assessing authority and the supervisor of assessments....

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5 cases
  • Maryland-National Capital Park and Planning Commission v. Washington Nat. Arena
    • United States
    • Maryland Court of Appeals
    • May 23, 1978
    ...should have refused to assume jurisdiction to award declaratory relief under the Uniform Declaratory Judgments Act. Md.-Nat'l C.P. & P. Com. v. Wash. Nat'l Arena, 37 Md.App. 346, 360-61, 377 A.2d 545 (1977). We granted certiorari to review the decisions of both courts, and for reasons that ......
  • Steuart Inv. Co. v. Board of Com'rs, St. Mary's County
    • United States
    • Court of Special Appeals of Maryland
    • January 10, 1978
    ...on Medical Discipline v. Bendler, 280 Md. 326, 327 & n. 1, 373 A.2d 1232, 1232 & n. 1 (1977); Md.-Nat'l C. P. & P. Comm'n v. Washington Nat'l Arena, 37 Md.App. 346, 350, 377 A.2d 545, 547, cert. granted, (C.A., 22 November 1977); Waller v. Montgomery County, 36 Md.App. 326, 334, 373 A.2d 97......
  • Supervisor of Assessments of Prince George's County v. Washington Nat. Arena Ltd. Partnership
    • United States
    • Court of Special Appeals of Maryland
    • June 12, 1979
    ...Planning Commission v. Washington National Arena, 282 Md. 588, 386 A.2d 1216 (1978); Maryland-National Capital Park and Planning Commission v. Washington National Arena, 37 Md.App. 346, 377 A.2d 545 (1977) Rev'd 282 Md. 588, 386 A.2d 1216 (1978); Maryland-National Capital Park and Planning ......
  • Breedon v. Maryland State Dept. of Ed.
    • United States
    • Court of Special Appeals of Maryland
    • March 5, 1980
    ...of jurisdiction which may be raised at any time, or by this Court sua sponte. Maryland National Capital Park & Planning Commission v. Washington National Arena, 37 Md.App. 346, 377 A.2d 545 (1977), rev'd on other grounds, 282 Md. 588, 386 A.2d 1216 (1978); see Mayor of Annapolis v. Hartge, ......
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