Wickes Asset Management, Inc. v. Dupuis

• Decision Date: 21 June 1996
• Docket Number: No. 94-82-A,94-82-A
• Citation: 679 A.2d 314
• Parties: WICKES ASSET MANAGEMENT, INC. v. Neil DUPUIS, in His Capacity as Tax Assessor of the Town of Lincoln, Rhode Island. ppeal.
• Court: Rhode Island Supreme Court

Page 314

679 A.2d 314

WICKES ASSET MANAGEMENT, INC. v. Neil DUPUIS, in His Capacity as Tax Assessor of the Town of Lincoln, Rhode Island.

No. 94-82-Appeal.

Supreme Court of Rhode Island.

June 21, 1996.

Mark A. Pogue, Providence, and George M. Prescott, Lincoln, for Plaintiff.

James P. Marusak, Providence, for Defendant.

OPINION

MURRAY, Justice.

This matter is before the court on appeal by the plaintiff, Wickes Asset Management, Inc. (Wickes), and on cross-appeal by the defendant, Neil Dupuis, in his capacity as tax assessor of the town of Lincoln (tax assessor or Lincoln), from a Superior Court judgment in respect to seven consolidated tax-abatement cases challenging allegedly excessive tax assessments of Wickes's property by Lincoln. For the reasons stated below, we sustain the appeal of Wickes in part and deny it in part; we sustain the appeal of Lincoln and remand the case to the Superior Court. The following facts are gleaned from the trial justice's decision and other portions of the extensive record in the case, which encompasses approximately 2,000 pages of testimony.

The property at issue is located at 400 Higginson Avenue in the town of Lincoln and consists of a 29.5-acre parcel of land, which was improved by a 481,000-square-foot structure. The structure consists of approximately 443,272 square feet of manufacturing space and 36,000 square feet of office space. Wickes Companies, Inc., a parent company of Wickes, is a Delaware corporation which originally acquired the property, known as the Collyer Wire facility, in 1985. As of May 1987 the property was held by Wickes Foundation, a nonprofit entity. In December 1987 Wickes purchased the property from the Wickes Foundation for $6.3 million. By November 1988 the Collyer Wire facility had ceased its wire-manufacturing operations, and in January 1989 the property was placed on the market for sale.

In May 1987 Wickes filed the first of seven tax-abatement petitions in the Superior Court, seeking judicial review of Lincoln's assessments for the years 1985 through 1991 ¹ on the basis that its property was overassessed. The property was assessed at $7,419,490 as of December 31 during the years 1981 through 1985 and was assessed at $7,373,490 as of December 31 during the years 1986 through 1991.

The cases were consolidated and tried before a Superior Court justice sitting without intervention of a jury. In the first part of a bifurcated trial, the parties addressed the issue of compliance with the statutory requirements of G.L.1956 § 44-5-15 and other threshold issues. In the second part of the trial, the parties presented evidence regarding the value of the property during the seven-year period at issue.

Following the first part of the trial, the trial justice rendered a bench decision in which she found that Wickes had failed to comply with the account-filing requirements of § 44-5-15. The trial justice specifically rejected Wickes's contention that Lincoln had failed to give proper notice to taxpayers as stautorily required and its contention that it had substantially complied with the statute. Moreover, she rejected Wickes's constitutional challenge of the statute.

The trial justice concluded that Wickes was barred from challenging the assessments under § 44-5-26(a) by demonstrating that the assessments exceeded the value of the property because the Superior Court lacked subject-matter jurisdiction as a consequence of Wickes's failure to file annual accounts. However, the trial justice permitted Wickes to present "evidence [in the second phase of the trial] which relates to the fact that the [assessments are] so excessive as to amount to an illegal tax" pursuant to § 44-5-26(b) in regard to all seven actions.

Additionally, in respect to case Nos. PC 87-4753, PC 89-5493, and PC 92-1671, for the tax-assessment dates of December 31, 1986, December 31, 1988, and December 31, 1991, respectively, the trial justice later ruled that she would permit Wickes to invoke the equity jurisdiction of the court pursuant to § 44-5-27. For those cases the trial justice was of the opinion that Wickes had filed the actions timely as provided for in § 44-5-27.

After hearing extensive evidence in respect to the second phase of the trial, which addressed the legality of the tax assessments, the trial justice rendered a written decision in which she concluded that Wickes had failed to demonstrate that the tax assessments for the years 1985 through 1989 were illegal. In reaching this conclusion, the trial justice thoroughly and meticulously evaluated the numerous appraisals obtained by the parties and determined that "the appraisals relied upon by Wickes [did] not support a finding [of] palpably excessive assessments which amount to illegal taxation." In fact she determined that Wickes had not proven that it was overassessed during these years. Moreover, she determined that Wickes was not entitled to any relief in equity for the December 31, 1986, and the December 31, 1988 dates of assessment because Wickes had not presented reliable evidence which demonstrated that the property was overassessed.

In respect to the 1990 assessment, the trial justice found that the "overassessment was the direct result of the closing of the [Collyer Wire facility by Wickes, which] allowed the building to deteriorate and through no action on the part of the tax assessor." She therefore determined that Wickes had failed to meet its burden of proving the assessment was illegal and concluded that it was not entitled to relief for the 1990 assessment.

Finally, in respect to the assessment dated December 31, 1991, the trial justice opined that sufficient grounds existed upon which to invoke the court's equity jurisdiction pursuant to § 44-5-27. She premised this determination upon Lincoln's delay in conducting its townwide property revaluation for 1991. The trial justice accepted Wickes's argument that the December 31, 1991 assessment would have been lower than the assessment which was subsequently issued two years later, on December 31, 1993, if Lincoln had conducted its revaluation at the time it should have. The trial justice concluded that the equities of the case entitled Wickes to a new tax assessment notwithstanding Wickes's failure to file an account for that year. The trial justice found that the property had a fair-market value which was lower than the value assessed by Lincoln. She determined that the total assessed value of Wickes's property, including the structure and the land, was $5,376,280 as of December 31, 1991. This sum was $1,997,210 less than Lincoln's assessment. Judgment subsequently entered from which both parties have appealed.

We begin our analysis of the instant appeals with a reiteration of the established principles of appellate review. "[T]he standard of review of the findings of a trial justice sitting without the intervention of a jury is extremely deferential." Clark-Fitzpatrick, Inc./Franki Foundation Co. v. Gill et al, 652 A.2d 440, 443 (R.I.1994). "[The] resolution of mixed questions of law and fact, as well as the inferences and conclusions drawn from the testimony and evidence, are entitled to the same deference." Warwick Musical Theatre, Inc. v. State, 525 A.2d 905, 909-10 (R.I.1987). We shall not disturb the findings of the trial justice on appeal unless he or she overlooked or misconceived material evidence or was otherwise clearly wrong. Clark-Fitzpatrick, 652 A.2d at 443 (citing Cerilli v. Newport Offshore Ltd., 612 A.2d 35 (R.I.1992)). With these principles firmly in mind, we turn first to the numerous issues raised by Wickes's appeal and then to the claim of error alleged by Lincoln.

Wickes raises numerous arguments in respect to the rulings made by the trial justice relating to the account-filing law, § 44-5-15. At the outset Wickes contends that the trial justice erred in determining that its failure to comply with § 44-5-15 deprived the Superior Court of subject-matter jurisdiction. Wickes alleges further that as a result of the trial justice's conclusion that it had failed to comply with § 44-5-15, it was required to satisfy a higher burden of proof in obtaining relief from the assessments under § 44-5-26(b), as opposed to the lower burden of proof required under § 44-5-26(a). Wickes argues that it substantially complied with § 44-5-15 by filing documents with the tax assessor which were the functional equivalent of an accounting, even though it did not specifically file annual accounts. Moreover, Wickes asserts that even if it did not substantially comply with the statute, Lincoln waived this affirmative defense by failing to assert timely such defense in its pleadings. Wickes also contends that the trial justice erred in rejecting its argument that § 44-5-15 is unconstitutional both on due-process and equal-protection grounds.

As an initial matter we first address Wickes's contention that the trial justice erred in finding that it had failed to comply with § 44-5-15. The trial justice rejected Wickes's argument that it had filed the functional equivalent of an account and concluded that "[t]here is no such thing as substantial compliance in the statute." Wickes asserts that it filed the functional equivalent of an accounting by virtue of numerous letters and statements it forwarded to the Lincoln Board of Tax Assessment Review (the board) during the years 1986 through 1992. The documents, although not sent within the strict filing deadlines delineated in the statute, essentially protested Lincoln's assessment values and, according to Wickes, "conveyed everything that a formal account was supposed to convey." As a result, Wickes argues, Lincoln unquestionably understood that it was Wickes's position that the assessments were excessive. Consequently Wickes argues that it satisfied the requirements of the statute; hence the trial justice should have permitted it to proceed under § 44-5-26(a).

We are persuaded that the trial justice...