RUCKSAPOL JIWUNGKUL, ETC. VS. DIRECTOR, DIVISION OF TAXATION (TAX COURT OF NEW JERSEY) ( 2017 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-4089-15T2
RUCKSAPOL JIWUNGKUL,
AS EXECUTOR OF THE
ESTATE OF MAURICE R.
CONNOLLY, JR., APPROVED FOR PUBLICATION
May 30, 2017
Plaintiff-Appellant,
APPELLATE DIVISION
v.
DIRECTOR, DIVISION OF
TAXATION,
Defendant-Respondent.
_______________________________________
Argued May 9, 2017 – Decided May 30, 2017
Before Judges Messano, Espinosa and Grall.
On appeal from the Tax Court of New Jersey,
Docket No. 9346-2015.
Robyne D. LaGrotta argued the cause for
appellant.
Heather Lynn Anderson, Deputy Attorney
General, argued the cause for respondent
(Christopher S. Porrino, Attorney General,
attorney; Melissa H. Raksa, Assistant
Attorney General, of counsel; Ms. Anderson,
on the brief).
The opinion of the court was delivered by
ESPINOSA, J.A.D.
Plaintiff Rucksapol Jiwungkul and Maurice R. Connolly, Jr.
registered as domestic partners pursuant to the Domestic
Partnership Act (DPA), N.J.S.A. 26:8A-2(d) on July 10, 2004.
They chose not to enter into a civil union and, sadly, Connolly
died shortly before they were to marry.
Plaintiff appeals from a decision of the Tax Court that
affirmed the denial of his request for a refund of inheritance
tax paid on behalf of Connolly's estate. Plaintiff argues the
trial court erred because the DPA violates the equal protection
guarantee of the New Jersey Constitution, Art. I, Para. 1, and
there is no rational basis for the marital deduction to be
different under the New Jersey Inheritance Tax Law and the New
Jersey Estate Law. We affirm, substantially for the reasons set
forth in the cogent and comprehensive written opinion of Judge
Patrick DeAlmeida, P.J.T.C., Jiwungkul, as Executor of the
Estate of Michael R. Connolly, Jr. v. Director, Division of
Taxation, Docket No. 009346-2015 (May 11, 2016).
In enacting the DPA, the Legislature expressed its intent
"that certain rights and benefits should be made available to
individuals participating in [domestic partnerships], including:
. . . certain tax-related benefits." N.J.S.A. 26:8A-2(c). The
tax-related benefits the Legislature stated domestic partners
"should be entitled to" were identified as "an additional
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exemption from the personal income tax and the transfer
inheritance tax on the same basis as a spouse." N.J.S.A. 26:8A-
2(d).
In Lewis v. Harris, 188 N.J. 415 (2006), the Court stated:
To comply with the equal protection
guarantee of Article I, Paragraph 1 of the
New Jersey Constitution, the State must
provide to committed same-sex couples, on
equal terms, the full rights and benefits
enjoyed by heterosexual married couples. The
State can fulfill that constitutional
requirement in one of two ways. It can
either amend the marriage statutes to
include same-sex couples or enact a parallel
statutory structure by another name, in
which same-sex couples would not only enjoy
the rights and benefits, but also bear the
burdens and obligations of civil marriage.
If the State proceeds with a parallel
scheme, it cannot make entry into a same-sex
civil union any more difficult than it is
for heterosexual couples to enter the state
of marriage.
[Id. at 463.]
The legislative response was to enact the Civil Union Act,
N.J.S.A. 37:1-28 to -36, which established "civil unions" that
were "meant to guarantee the rights and benefits of marriage,
but [did] not allow same-sex partners to 'marry.'" Garden State
Equality v. Dow, 216 N.J. 314, 318 (2013) (citing N.J.S.A. 37:1-
28, -33). After establishing civil unions, the Legislature
effectively terminated the registration of new domestic
partnerships and stated the new statute "shall not alter the
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rights and responsibilities of domestic partnerships existing
before the effective date of this act." N.J.S.A. 26:8A-4.1.
Plaintiff filed New Jersey tax returns on behalf of
Connolly's estate that were consistent with their status as
domestic partners. He claimed the spousal exemption allowed for
domestic partners under the New Jersey Inheritance Tax, N.J.S.A.
54:34-2(a)(1), and paid $6,000 in inheritance tax. Because no
spousal deduction was permitted for domestic partners under the
New Jersey Estate Tax, N.J.S.A. 54:38-1 to -16, he did not claim
such a deduction and paid $101,040.72 in estate tax.
Approximately two months later, plaintiff filed an amended
estate tax return in which he claimed a marital deduction for
all property passing to him from Connolly and a concomitant
refund of $101,040.72. Although the marital deduction he sought
was not authorized under the DPA, it was available prior to
Connolly's death to members of a civil union. N.J.S.A. 37:1-
32(n); N.J.A.C. 18:26-3A.8(e). Plaintiff's request for a refund
was denied by the Division of Taxation with the explanation,
"Please be advised that a Domestic Partner receives the Class A
exemption for Inheritance Tax purposes however, a Domestic
Partner does not receive the Marital Deduction for Estate Tax
purposes."
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Plaintiff then filed a complaint in the Tax Court,
contending the denial of his request violated the DPA and the
Supreme Court's holding in Lewis, and moved for summary
judgment. The Division of Taxation cross-moved for summary
judgment. Judge DeAlmeida affirmed the denial of refund,
granting the Division's cross-motion and denying plaintiff's
motion.
In his opinion, Judge DeAlmeida identified the "central
question" as "whether the [DPA] provides that a surviving same-
sex registered domestic partner is to be treated as a surviving
spouse for purposes of calculating the New Jersey estate tax."
Jiwungkul, supra, slip op. at 1-2. He reviewed the evolution in
recognizing the rights of same-sex couples in the courts and in
legislation, the differences in the transfer inheritance tax and
the estate tax and the fact that, after passage of the DPA, the
Legislature amended four specific statutory provisions to apply
certain tax benefits – not including the estate tax -- to same-
sex registered domestic partners. Id. at 4-10, 14. Judge
DeAlmeida stated, "Only extraordinary circumstances would
warrant a court engrafting into the DPA a tax benefit not
mentioned in the statute." Id. at 18. Such circumstances would
exist when a couple was "unable to enter into a marriage or
other State-sanctioned relationship affording them a tax benefit
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available to married couples." Id. at 19. Judge DeAlmeida
noted that "crucial fact" was absent here. Ibid. He observed
further that in deciding Lewis, the Supreme Court identified a
remedy to satisfy the constitutional infirmity rather than hold
the DPA should be construed to afford all the rights of marriage
to registered domestic partners. Ibid. We agree with Judge
DeAlmeida that the DPA should be applied as written and that,
because same-sex couples can access all the rights and benefits
of marriage through marriage or civil unions, there is no
constitutional violation.
Affirmed.
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