Poddar v. Dept. of Rev.

• Decision Date: 27 May 1999
• Citation: Poddar v. Dept. of Rev., 328 Or 552, 983 P.2d 527, 328 Ore. 552 (Or. 1999)
• Parties: Bhagwati P. PODDAR, Appellant, v. DEPARTMENT OF REVENUE, State of Oregon, Respondent, and Clatsop County, Intervenor-Respondent.
• Court: Oregon Supreme Court

983 P.2d 527

328 Or. 552

328 Ore. 552

Bhagwati P. PODDAR, Appellant, v. DEPARTMENT OF REVENUE, State of Oregon, Respondent, and Clatsop County, Intervenor-Respondent.

(OTC 3773; SC S44343)

Supreme Court of Oregon.

Submitted on the Record June 19, 1998.

Decided May 27, 1999.

Bhagwati P. Poddar, petitioner pro se, filed the brief.

Rochelle Nedeau, Assistant Attorney General, Salem, filed the brief for respondent. With her on the brief was Hardy Myers, Attorney General.

Blair J. Henningsgaard, Astoria, waived appearance for intervenor-respondent Clatsop County.

Before CARSON, Chief Justice, and GILLETTE, VAN HOOMISSEN, DURHAM, and LEESON, Justices.¹

DURHAM, J.

Taxpayer appeals a judgment entered after the Oregon Tax Court dismissed his amended complaint for failure to state a claim. Taxpayer contends that, although his amended complaint challenged the assessed value of only some of the improvements on his property, his amended complaint is sufficient. Taxpayer further challenges discovery orders issued by the Tax Court. We review for errors of law. ORS 305.445.² We conclude that taxpayer's amended complaint states a claim. We also conclude that the Tax Court committed no error regarding the discovery orders. Accordingly, we reverse the judgment and remand the case to the Tax Court for further proceedings.

Taxpayer seeks relief from alleged assessment errors made by the Clatsop County Assessor in tax year 1993-94. Taxpayer sought review of the assessments from the county board of equalization³ and the Department of Revenue (department), both of which affirmed the assessor's action.

In January 1995, taxpayer filed a complaint in the Tax Court against the department.⁴ Taxpayer alleged that the assessor erred in assigning valuations to several structures on one piece of property: a partially completed residence, an older residence, a machine shed, a greenhouse, and a barn/garage. According to taxpayer, the assessor overvalued his property by $103,872. In January 1996, the department requested inspection of taxpayer's property. At that time, taxpayer had completed his residence. Taxpayer objected on relevancy grounds to an inspection of his completed residence, arguing that the sole issue was the percentage of completion at the time of the 1993-94 assessment. He maintained that the department could not determine the value of the partially completed residence by inspecting the completed residence. He also asserted a constitutional right to privacy. The department moved to compel inspection, and the Tax Court allowed the motion.

On April 8, 1996, taxpayer filed a notice of appeal with this court, seeking to challenge the constitutionality of the order compelling inspection. Two days later, representatives from the assessor's office attempted to inspect the property, but taxpayer's wife denied them access. In June 1996, this court dismissed taxpayer's appeal for lack of jurisdiction.

On January 6, 1997, the Tax Court issued a second order allowing inspection. According to taxpayer, in an effort to protect the privacy of his residence from an inspection under that discovery order, taxpayer, on January 16, 1997, moved for leave to file an amended complaint that taxpayer asserted would remove from controversy the percentage of completion and valuation of the new residence as of July 1, 1993, and accept the assessor's valuation. On January 22, 1997, representatives of the assessor's office again tried to inspect the property. Taxpayer provided access to the interior of the old residence and the machine shed, but taxpayer's wife denied access to the interior of the new residence, the greenhouse, and the barn/garage.

On February 6, 1997, the Tax Court, over the department's objection, allowed taxpayer's motion to amend his complaint. Taxpayer's amended complaint alleged that the assessor erred in valuing only the old residence, the machine shed, and the greenhouse. The total overvaluation, according to the amended complaint, was $30,370. The department moved to dismiss or, alternatively, to strike the amended complaint under Tax Court Rule (TCR) 21 A(8) and TCR 21 E(1).⁵ The department contended that taxpayer's amended complaint failed to state a claim, because a complaint that challenges the valuation of only some improvements to real property fails to allege all the ultimate facts needed for an appeal of the "roll value" of the improvements, i.e., the assessed value of the improvements that ORS 308.215(1)(f) requires the assessor to place on the assessment roll.

The Tax Court granted the motion to dismiss. The order of dismissal stated that taxpayer acknowledged that his amended complaint was intended to avoid inspection of his residence. The Tax Court also concluded that the department's right to defend against taxpayer's action outweighed taxpayer's constitutional right of privacy. The court gave taxpayer 30 days to amend his complaint. Taxpayer did not file a second amended complaint, but instead informed the court that he intended to appeal the dismissal to this court. On June 6, 1997, the Tax Court issued a judgment of dismissal, and this appeal followed.

Taxpayer raises three assignments of error. We first address his third assignment of error, in which taxpayer challenges the dismissal of his amended complaint. The department argued, and the Tax Court agreed, that the complaint failed to state a claim based on ORS 308.215(1), which provides, in part:

"The assessor shall prepare the assessment roll in the following form:

"* * * * *

"(1) * * * For each parcel of real property, the assessor shall set down in the assessment roll according to the best information the assessor can obtain:

"* * * * * * "(e) The assessed value, maximum assessed value and real market value of the land, excluding all buildings, structures, improvements and timber thereon.

"(f) The assessed value, maximum assessed value and real market value of all buildings, structures and improvements thereon."

(Emphasis added.) The Tax Court interpreted the emphasized wording as follows:

"Where there are multiple buildings, structures, and improvements for a single account, the statute requires the assessor to enter a single improvement value on the roll. The assessor may, as he has done here for administrative purposes, assign a value to each of the improvements. However, the only assessed value for tax purposes is the value placed on the assessment roll.

"Because the statutes require land and improvements to be separately addressed, a taxpayer may elect to appeal either or both. Nepom v. Dept. of Revenue, 272 Or. 249, 536 P.2d 496 (1975). However, the statutes do not contemplate or allow a taxpayer to appeal only part of an assessed value. To appeal the assessed value of any improvements within a single account, the taxpayer must allege that the assessed value is in error and a lesser value is correct. Plaintiff's Amended Complaint fails to do this and therefore fails to state a claim."

Taxpayer argues that ORS 308.215 is silent about the issues that a taxpayer may appeal and that the Tax Court misinterpreted that statute. He also points to TCR 12, which provides:

"A. All pleadings shall be liberally construed with a view of substantial justice between the parties.

"B. The court shall, in every stage of an action, disregard any error or defect in the pleadings or proceedings which does not affect the substantial rights of the adverse party."

He notes that his amended complaint alleged the total assessed value, the assessed value with respect to each improvement, the contested improvements, and their correct values. Taxpayer argues that, liberally construed, those allegations are sufficient to state a claim.

Taxpayer's claim is based on ORS 309.100 (1993), which provided, in part:

"(1) The owner or an owner of any taxable property * * * may petition to the board of equalization for reduction of the real market or assessed value placed upon the property by the county assessor. Petitions filed under this subsection shall be for the reduction of the real market or assessed value of property as of July 1 * * *.

"* * * * *

"(3) Each petition for the reduction of the real market or assessed value of a particular property shall:

"* * * * *

"(b) State the facts and the grounds upon which the petition is made."

According to the department, ORS 309.100 allows a taxpayer to petition for reduction in the real market or assessed values "placed on the roll." The department observes that, under ORS 308.215(1)(f), the valuation that the assessor must "place on the roll" for improvements is that of "all buildings, structures and improvements." The department argues that that phrase means a single number that represents the value of the total of all improvements. The department contends that, because taxpayers may challenge the assessed values "placed on the roll" and because what must be "placed on the roll" is a total valuation of improvements, a complaint that challenges the valuation of improvements fails to state a claim, unless it challenges the total valuation of all improvements together.

The department's argument is not well taken. Because the task at hand requires us to construe a statute, we are guided by the principles set out in PGE v. Bureau of Labor and Industries, 317 Or. 606, 610-12, 859 P.2d 1143 (1993) (articulating methodology for statutory construction).

In this instance, the context of the statute—specifically its earlier formulation—proves particularly instructive. ORS 309.100(1) (1989) provided:

"The owner or an owner of any taxable property or the person in whose name the property is assessed, may petition to the board for reduction and equalization of the true cash value placed upon the property by the county assessor on the roll submitted to the board in accordance with ORS 309.060."

That version of the statute afforded at least some support for the department's argument that the objective of any taxpayer's petition was...