Transtechnology Corp. v. Board of Assesors, 2008 NY Slip Op 32484(U) (N.Y. Sup. Ct. 9/4/2008)
| Decision Date | 04 September 2008 |
| Docket Number | 2256-96.,Motion Sequence # 001. |
| Citation | 2008 NY Slip Op 32484 |
| Parties | TRANSTECHNOLOGY CORP., Petitioner, v. THE BOARD OF ASSESSORS and/or THE ASSESSOR OF THE COUNTY OF NASSAU and THE BOARD OF ASSESSMENT REVIEW, Respondents. |
| Court | New York Supreme Court |
The Petitioner moves for an order restoring the proceedings to the ready trial calendar of the tax certiorari part of the Supreme Court, and requests the scheduling of an appraisal exchange date. The Respondents oppose the application on the ground that the application is made more than three years from the August 25, 1999 date on which the matter was removed from the trial calendar, and that payments of refunds with interest as far back as 1996 would create fiscal chaos, and be prejudicial to the County.
In 1993, during the height of what could only be classified as a tax certiorari crisis in Nassau County, Hon. Leo F. McGinity, then the presiding Justice and Administrative Judge, sought to reduce the extraordinary backlog of such matters on the active trial calendar. The depth to which the system had descended was described in detail by now-deceased Hon. Frank Rossetti, J.C.C. in his decision in Boardwalk Condominium No. I v. Board of Assessors, et al., Index Nos. 18523/86, et al. and 17-8708/89, et al.
Following a highly critical National Center for State Courts analysis of tax certiorari calendar problems in Nassau County, a copy of which went to Hon. Leo Molinas, the then Chief Administrative Judge for the New York State Courts, Justice McGinity instituted monthly calendar calls of 500 tax certiorari cases. These calendar calls were to continue until all cases on the ready trial calendar were reached. Once called, the cases were removed from the ready calendar and transferred to a reserve calendar. Blanket orders exempting the cases from the impact of Civil Practice Law and Rules § 3404 were to issue, and no additional Notes of Issue were required for restoration. At a "report-back" date, six months thereafter, the cases would be marked either "settled" or "discontinued". Cases which were so marked, could be restored to the ready trial calendar upon the filing by the Petitioner of an appraisal.
This case is one of the thousands that were marked off the ready trial calendar in accordance with the foregoing procedure. A Note of Issue for tax year 1996/97 was filed on or about October 8, 1997. It appeared on the August 25, 1999 calendar at which time it, along with all other cases appearing on the calendar, were "marked off". The purpose was to allow the County to obtain limited appraisals for negotiation purposes. It was not until September, 2001 that the County advised Petitioner's counsel of the assigned appraiser, and, in January 2002 the requisite information was forwarded to him.
Upon being notified in mid-2005 that the Nassau County Assessment Review Commission (ARC) had scheduled a hearing for all tax years under review for September 28, 2005, counsel submitted updated and additional information to them, as well as to the County's designated appraiser. Upon receipt of a preliminary appraisal of his own, counsel forwarded the conclusions of overassessment to ARC, and, by letter dated October 6, 2005, requested a conference with the County Attorney's Office. It was not until May 6, 2006 that the County authorized their appraiser to prepare a preliminary appraisal for the years under review.
Conferences on September 27, 2006 and January 12, 2007 were not fruitful, after which counsel supplied ARC with additional financial information with respect to the cost to remediate the presence of volatile organic compounds, which were first discovered at the site in the mid-1990's. The New York State Department of Environmental Conservation (NYSDEC) classified the premises as a Class 2 Inactive Hazardous Waste Disposal Site in 2000.
After failing to resolve the matter through administrative efforts between 2001 and 2008, the Petitioner asks the Court to restore it to the active trial calendar, and set a date for the exchange of expert reports.
Tax certiorari proceedings have occupied an inordinately disproportionate amount of judicial resources in Nassau County for many years. Boardwalk Condominium I v. Board of Assessors, et al, (supra), notes that, as far back as 1990, tax certiorari matters occupied almost 40% of the ready trial calendar in Nassau. But major, and even landmark, decisions on tax assessment matters long predated 1990.
In 860 Executive Towers, Inc. v. Board of Assessors of the County of Nassau, (53 A.D.2d 463, 2nd Dept., 1976), the Court was called upon to review a decision of Hon. Howard T. Hogan, J.S.C., in which he granted motions by the Petitioners in 20 consolidated actions for partial summary judgment on the issue of inequality of assessment and determined ratios for each of the actions for the years 1966 — 1973. The County sought to limit a decision of the Court of Appeals, Guth v. Gingold, (34 N.Y.2d 440, 1974), which approved the use of the State equalization rate as the sole determinant of ratio in tax certiorari proceedings from 1970 forward, in keeping with the 1969 amendment of Real Property Tax Law § 720. That amendment was specifically enacted to overcome the decision of the Court of Appeals in Matter of O'Brien v. Assessor of the Town of Mamaroneck, (20 N.Y.2d 587, 596), which determined that the State rate was entitled to "little weight", because those rates were derived at by processes foreign to those employed in juridical proceedings.
As noted in 860 Executive Towers (at 469), the County's rejection of Guth required proceedings which . . . consumed many months, cost the petitioners over $400,000 in expenses, fees and disbursements, and resulted in a 14-volume record on appeal, plus numerous cartons of exhibits. The trial was not merely a replay of the Guth trial but, in point of fact, an intensive and exacting examination of the SBEA's methodology applied to Nassau County, despite the fact that the Guth decision predated this ratio trial by several months.
In affirming the judgment, interlocutory judgment and orders of the Supreme Court, the Court made it clear that all of the effort and expense generated by the Board of Assessors and other appellants was essentially a waste, in that Guth was directly on point, and indistinguishable from the appellants' claims.
Nevertheless, the Appellate Division granted leave to appeal and certified the following question to the Court of Appeals: "(w)as the order of this court dated July 12, 1976 properly made?" The Court of Appeals responded in the affirmative and affirmed on the decision of the Appellate Division sub nom. (Matter or Pierre Pellaton Apts. v. Board of Assessors of the County of Nassau, 43 N.Y.2d 769, 1977).
Commercial properties have not been the sole source of the inordinate backlog of tax certiorari matters in the County. In Chasalow v. Board of Assessors of County of Nassau, (202 A.D.2d 499, 2nd Dept., 1994), the Court reviewed a determination of Hon. Leo F. McGinity, J.S.C., that the methodology used by Nassau County Department of Assessment to assess Class I properties (one, two and three-family homes) produced such wide disparities in similarly situated homes so as to constitute a violation of the equal protection clause of the constitution. The proceedings pursuant to Article 78 were to review 10 separate determinations.
Until the relatively recent revaluation and reassessment of all property in Nassau County, assessments for Class I property was based on 1938 construction costs, to which was added the 1938 land value, updated to 1964. Utilizing a coefficient of dispersion, the petitioners claimed, through expert testimony, that this measurement showed a wider variance among ratios under consideration than the State Board of Equalization and Assessment recommended. In fact, the State showed that only about 7% of taxing authorities met the standards for 1986 data, and that the proper coefficient of diversion for Nassau was 15%.
In reversing the decision of Supreme Court, the Appellate Division noted that in the area of real property taxes, "rough equality, not complete uniformity, is all that is required". (Id at 501). Leave to appeal to the Court of Appeals was denied. (Chasalow v. Board of Assessors of County of Nassau, 83 N.Y.2d 759).
The claimed "fiscal chaos" which will attend the restoration to the calendar of this action is not an unfamiliar refrain. In a matter presently sub judice before Hon. Edward G. McCabe, the County argued this position in the Court of Appeals, which remitted the matter to Supreme Court for a hearing on the issue of the fiscal impact upon the County. (New York Telephone v. Nassau County, et al., 1 N.Y.3d 485, 491). Upon remittitur, the County has taken the position that there is no economic impact upon the County, because, despite the determination of the Court of Appeals, the burden for tax refunds is upon the special districts, not on the County. This would restore the interpretation by the Appellate Division, which the Court of Appeals reversed.
As the Court in New York Telephone pointed out, there have been cases in which the Court has refused to grant the relief requested based on the effect it would have on the municipality, but such relief is not available in the absence of a determination of the amount of the refund and the impact on the County. (Id). In the matter before this Court, there has not even been a determination of liability for overassessment, much less evidence of its impact upon the County.
The present matter is part of what is likely the most onerous burden that the Court has been asked to shoulder in many years. The simple fact is that because of the inability of the Respondents to administratively resolve a significant number of the assessment...
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