Verizon New England Inc. v. Savage

• Decision Date: 09 February 2022
• Docket Number: A.A. 18-187,No. 2020-40-M.P.,2020-40-M.P.
• Citation: 267 A.3d 647
• Parties: VERIZON NEW ENGLAND INC. v. Neena S. SAVAGE, in her capacity as Tax Administrator for the State of Rhode Island.
• Court: Rhode Island Supreme Court

267 A.3d 647

VERIZON NEW ENGLAND INC.

v.Neena S. SAVAGE, in her capacity as Tax Administrator for the State of Rhode Island.

No. 2020-40-M.P.

A.A. 18-187

Supreme Court of Rhode Island.

February 9, 2022

Thomas P. Quinn, Esq., Matthew R. Joyce, Esq., William A. Hazel, Esq., Pro Hac Vice, for Plaintiff

Robert K. Taylor, Esq., Frank J. Milos, Jr., Esq., for Defendant

Present: Suttell, C.J., Goldberg, Robinson, Lynch Prata, and Long, JJ.

Justice Goldberg, for the Court.

This case came before the Supreme Court on November 4, 2021, pursuant to a writ of certiorari issued upon petition by the City of Pawtucket (Pawtucket) and the City of Cranston (Cranston) (collectively movants).¹ The movants seek review of a decision by the Sixth Division District Court denying their motions to intervene in an action commenced by the plaintiff, Verizon New England Inc. (Verizon), by way of appeal from a decision of the defendant, the Tax Administrator for the State of Rhode Island.² According to the movants, the trial judge erred in determining that those cities’ interests in this controversy would be adequately represented by the City of Providence (Providence), an intervenor in this case. For the reasons set forth in this opinion, we affirm the order of the District Court denying the motions to intervene.

Facts and Travel

This controversy arose from Verizon's challenge to a 2018 final decision of the tax administrator that upheld an assessment of Verizon's tangible personal property (TPP) tax and denied Verizon's request for a lower assessment and a partial refund for TPP taxes paid from 2010 through 2014. On December 21, 2018, Verizon filed an administrative appeal in the District Court in accordance with G.L. 1956 § 8-8-24, seeking to set aside the tax administrator's final decision, alleging that the tax administrator failed to apply the proper depreciation approach, which, according to Verizon, resulted in excessive assessments and overpayments totaling approximately $21,358,152.

Initially, on February 27, 2019, the District Court heard and denied motions filed by the tax administrator to dismiss this case for failure to join indispensable parties and, alternatively, to join indispensable parties—the state's thirty-nine cities and towns and the Department of Revenue Division of Municipal Finance.

In October 2019, Providence moved to intervene as of right, followed by Pawtucket and Cranston. In its memorandum in support of its motion, Providence claimed an interest in the TPP tax and contended that, under G.L. 1956 § 44-13-13, most of the TPP tax is "apportioned to the cities and towns[,]" and, thus, Providence's interests could be substantially impacted by the outcome of the action.³ Significantly, in their motions to intervene, movants merely adopted Providence's memorandum of law and the arguments therein and presented no additional contentions separate from those offered by Providence.

On January 14, 2020, the District Court held a hearing on the motions to intervene. The trial judge granted Providence's motion and denied movants’ motions. The trial judge carefully reviewed the four requisites necessary for intervention⁴ —namely that (1) the applicant files a timely application, which was not at issue in this case; (2) the applicant claims an interest relating to the property or transaction; (3) the disposition of the action may, as a practical matter, impair or impede the applicant's ability to protect that interest; and (4) the applicant's interest is not adequately represented by the current parties to the action.

The trial judge determined that all three cities satisfied the second and third requirements, but further found that Providence adequately represented the interests of both Pawtucket and Cranston. Specifically, with respect to the second requirement, the trial judge found that, because the three cities are direct beneficiaries of the TPP tax, and thus have an economic interest that is intertwined with the tax revenue at issue and any future distributions, they have an interest relating to the property or transaction in dispute—namely, Verizon's request for a lower tax assessment. With respect to the third requisite, the trial judge found that the cities had no other avenue to protect their interests in the event of an adverse ruling. Finally, while acknowledging that the fourth requirement generally involved a minimal threshold, the trial judge found that the cities’ interests were not adequately represented by the state agency and that intervention was appropriate. Apparently concerned with an influx of motions to intervene from multiple municipalities in the state, and because movants had simply relied upon Providence's memorandum and arguments in support of their own motions to intervene, the trial judge found that the interests of Pawtucket and Cranston would be adequately represented by Providence, which was allowed to intervene as of right. An order entered in the District Court on January 16, 2020, memorializing the trial judge's decision.

The movants filed a petition for writ of certiorari pursuant to § 8-8-32, which this Court granted on June 25, 2020.⁵ The movants had argued in support of their petition that the trial judge erred in concluding that Providence adequately represented their interests when Providence was not yet a party—a finding to which movants were not afforded an opportunity to respond—and that the proper inquiry was whether the parties to the action at the time of the hearing on their motions, which did not then include Providence, adequately represented movants’ interests. Accordingly, in granting certiorari we remanded the record to the District Court with direction to "allow [p]etitioners the opportunity to set forth, with particularity, what their individual interests in the matter are and why those interests cannot be adequately represented by the City of Providence" and to issue a decision on the motions to intervene setting forth the court's findings and reasoning therefore.

On remand, the trial judge again determined that movants’ interests were adequately represented by Providence, and he denied their motions to intervene. The trial judge concluded that the ultimate issue in the case was the "statutory interpretation of accumulated depreciation" and that, except for the varying distribution to each municipality under the law, movants’ interests and arguments were identical to those of Providence—being that the proper calculations were performed by the tax administrator and the taxes were correctly paid and distributed. As a result, an order on remand entered on September 10, 2020, denying movants’ request to intervene, and the case was returned to this Court.⁶

Standard of Review

"Our review of a case on certiorari is limited to an examination of the record to determine if an error of law has been committed." State v. Poulin , 66 A.3d 419, 423 (R.I. 2013) (quoting State v. Greenberg , 951 A.2d 481, 489 (R.I. 2008) ). "In addition to examining the record for judicial error, ‘we inspect the record to discern if there is any legally competent evidence to support the findings of the hearing justice below.’ " Id. (quoting Brown v. State , 841 A.2d 1116, 1121 (R.I. 2004) ). "We shall not disturb the findings of the trial justice unless it is established that he or she misconceived or overlooked relevant and material evidence or was otherwise clearly wrong." WMS Gaming, Inc. v. Sullivan , 6 A.3d 1104, 1111 (R.I. 2010) (quoting New England Telephone and Telegraph Co. v. Clark , 624 A.2d 298, 300 (R.I. 1993) ).

Additionally, "[t]his Court reviews a trial justice's [decision on] a motion to intervene for abuse of discretion, reversing only if the justice failed to apply the standards set forth in Rule 24(a)(2), or otherwise committed clear error." Town of Coventry v. Baird Properties, LLC , 13 A.3d 614, 619 (R.I. 2011).

Discussion

Rule 24(a)(2) of the District Court Civil Rules provides for intervention as of right when "[u]pon timely application * * * the representation of the applicant's interest by existing parties is or may be inadequate and the applicant is or may be bound by a judgment in the action[.]"⁷ The relevant language of that rule and Rule 24 of the Superior Court Rules of Civil Procedure were identical prior to a 1995 amendment to the Superior Court rule for intervention as of right, which was enacted in order to align with its federal counterpart.⁸ See Reporter's Notes to Dist. Ct. Civ. R. 24 ; Super. R. Civ. P. 24(a). Notably, in Marteg Corporation v. Zoning Board of Review of City of Warwick , 425 A.2d 1240 (R.I. 1981), which was decided prior to the amendment, this Court analyzed one's right to intervene in a Superior Court action according to the four elements that now comprise Superior Court Rule 24(a).⁹ See Marteg Corporation , 425 A.2d at 1242. Because we have held that the language of District Court Rule 24(a)(2)—albeit in the context of the pre-amendment Superior Court rule—is applicable by way of the test set forth in Marteg , it was appropriate for the trial judge in the present case to follow that test in evaluating whether an applicant should be allowed to intervene as of right in a District Court proceeding. See id.

To establish a right to intervene, movants were required:

"(1) to file timely application for intervention, (2) to show an interest in the subject matter of that action in that the disposition of the action without intervention would as a practical matter impair or impede their ability to protect that interest, and (3) to establish that their interest was not adequately represented by the existing parties." Marteg Corporation , 425 A.2d at 1242.

On review, movants do not challenge the trial judge's findings with respect to the first two components¹⁰ of this rule; rather, they contend that the trial judge erred in finding that Providence would adequately represent their interests because, they contend, he focused too narrowly on the parties’...