Michael A. Balmuth v. David E. Dolce, in his capacity as Tax Assessor for the Town of Portsmouth John Qua v. David E. Dolce William Antle v. David E. Dolce , 182 A.3d 576 ( 2018 )

May 2, 2018
May 2, 2018
Supreme Court
Michael A. Balmuth et al. :
v. : No. 2017-6-Appeal.
(NC 10-296)
David E. Dolce, in his capacity as Tax Assessor :
for the Town of Portsmouth.
John Qua et al. :
v. : No. 2017-8-Appeal.
(NC 10-298)
No. 2017-9 Appeal.
(NC 11-127)
David E. Dolce, in his capacity as Tax Assessor :
for the Town of Portsmouth.
William Antle :
v. : No. 2017-11-Appeal.
(NC 10-299)
No. 2017-12-Appeal.
(NC 11-131)
David E. Dolce, in his capacity as Tax Assessor :
for the Town of Portsmouth.
NOTICE: This opinion is subject to formal revision before publication in
the Rhode Island Reporter. Readers are requested to notify the Opinion
Analyst, Supreme Court of Rhode Island, 250 Benefit Street, Providence,
Rhode Island 02903, at Tel. 222-3258 of any typographical or other
formal errors in order that corrections may be made before the opinion is
published.
Supreme Court
(dissenting opinion
begins on page 18)
Michael A. Balmuth et al. :
v. : No. 2017-6-Appeal.
(NC 10-296)
David E. Dolce, in his capacity as Tax Assessor :
for the Town of Portsmouth.
John Qua et al. :
v. : No. 2017-8-Appeal.
(NC 10-298)
No. 2017-9 Appeal.
(NC 11-127)
David E. Dolce, in his capacity as Tax Assessor :
for the Town of Portsmouth.
William Antle :
v. : No. 2017-11-Appeal.
(NC 10-299)
No. 2017-12-Appeal.
(NC 11-131)
David E. Dolce, in his capacity as Tax Assessor :
for the Town of Portsmouth.
Present: Suttell, C.J., Goldberg, Flaherty, Robinson, and Indeglia, JJ.
OPINION
Justice Flaherty, for the Court.
-1-
“Don’t tax you,
Don’t tax me,
Tax that fellow behind the tree.” 1
The defendant, who is the tax assessor for the Town of Portsmouth,2 appeals from a
judgment of the Superior Court in favor of the plaintiffs, a group of Portsmouth taxpayers who
had challenged the defendant’s tax assessments on their properties for tax years 2009 and 2010.
These cases come to us in the wake of what is considered generally to be the worst economic
downturn since the Great Depression. It is common knowledge that in 2008 the stock market
plummeted, and with it the value of real estate throughout the country tumbled as well. It also is
well known that Rhode Island was not immune from the effects of that economic collapse.
Indeed, as both the plaintiffs and the defendant agree, the value of the plaintiffs’ properties
decreased in 2008 and 2009. This appeal, though, is not a contest about the value of the
plaintiffs’ properties. Rather, this appeal is about whether certain sections of G.L. 1956 chapter
5 of title 44 require the plaintiffs to base their tax appeals on the fair market value of their
properties “as of December 31 in the year of the last update or revaluation * * *.”
When the plaintiffs appealed their assessments for tax years 2009 and 2010, the
defendant maintained that they were locked in to the value of their properties as of December 31,
2007, the year of Portsmouth’s last revaluation. The plaintiffs, whose properties had experienced
a substantial decline in value after December 31, 2007, disagree. After a nonjury trial based on
an agreed statement of facts, the trial justice concluded that, based on the language set forth in
the pertinent sections of chapter 5 of title 44, the plaintiffs were not “locked in” to the values of
1
Attributed to Senator Russell B. Long. See William B. Mead, Congress Tackles the Income
Tax, MONEY, July 1973, at 55 (“‘Most people have the same philosophy about taxes,’ says
Senator Russell B. Long * * *: Don’t tax you, Don’t tax me, Tax that fellow behind the tree.”).
2
During the pendency of these consolidated appeals, Matthew Helfand replaced David E. Dolce
as the tax assessor for the Town of Portsmouth.
-2-
their properties as of December 31, 2007. 3 Put another way, the trial justice decided that the
plaintiffs were authorized under the law to challenge the defendant’s assessments for tax years
2009 and 2010 by employing the fair market values of their properties as of December 31, 2008
and December 31, 2009, respectively. We agree. Accordingly, for the reasons set forth in this
opinion, we affirm the judgment of the Superior Court.
I
Facts and Travel
The facts here are undisputed and straightforward. The plaintiffs all own property in the
Town of Portsmouth. More specifically, each of the plaintiffs owns a condominium in the same
development. In 2007, consistent with his statutory duties as the tax assessor for Portsmouth,
defendant conducted a full-scale revaluation of all real estate in the town, including plaintiffs’
properties. 4 The defendant determined that, as of December 31, 2007, the full and fair cash
values 5 of plaintiffs’ properties were as follows: the Balmuth Property, $4,430,200; the Qua
Property, $5,320,800; and the Antle Property, $4,076,500.
Then, in 2008, the economy cratered. There is no question that real estate values were
adversely affected by the downturn. Nevertheless, as he was permitted to do, for his assessment
for tax year 2009, defendant carried forward the December 31, 2007 valuations of plaintiffs’
3
The parties agreed that the assessor’s valuations for December 31, 2007, were correct and that
the values claimed by plaintiffs for December 31, 2008, and December 31, 2009, were also
correct. We appreciate the level of cooperation exhibited by the parties in reaching agreement on
several factual issues, especially in that it has allowed us to focus on the issue before the Court.
4
Pursuant to G.L. 1956 § 44-5-11.6(a)(2)(i), defendant was required to conduct a revaluation in
2007. Section 44-5-11.6(a)(2)(ii) requires local tax assessors to “conduct a revaluation within
nine (9) years of the date of the prior revaluation and * * * conduct an update of real property
every three (3) years from the last revaluation.”
5
As used in chapter 5 of title 44, the terms “full and fair cash value” and “fair market value” are
synonymous. See Harvard Pilgrim Health Care of New England, Inc. v. Gelati, 865 A.2d 1028,
1035 (R.I. 2004) (“We have defined ‘full and fair cash value’ as fair market value.” (quoting Nos
Limited Partnership v. Booth, 654 A.2d 308, 310 (R.I. 1995))). Accordingly, throughout this
opinion, we use them interchangeably.
-3-
properties. For tax year 2010, he did the same. Thus, for tax years 2009 and 2010, defendant
assessed plaintiffs’ property taxes based on the fair market values of those properties as of
December 31, 2007.
However, as of December 31, 2008—the date of assessment for tax year 2009—and
December 31, 2009—the date of assessment for tax year 2010—the fair market values of
plaintiffs’ properties had decreased. As of December 31, 2008, the parties stipulate that the fair
market values of plaintiffs’ properties were as follows: the Balmuth Property, $4,107,333; the
Qua Property, $4,788,720; and the Antle Property, $3,668,850. As of December 31, 2009, the
fair market values of plaintiffs’ properties were as follows: the Qua Property, $4,256,640; and
the Antle Property, $3,261,200. 6
The plaintiffs sought review of those assessments on the ground that they had been
overtaxed for tax years 2009 and 2010. 7 Following the procedure set forth in § 44-5-26(a),
plaintiffs first appealed to defendant. He denied their appeals, informing plaintiffs that, under
chapter 5 of title 44, he had properly carried forward the December 31, 2007 valuations for use
in determining his assessments for tax years 2009 and 2010. The plaintiffs then appealed to the
Portsmouth Tax Assessment Board of Review, where they were again denied relief. Still
unsatisfied, plaintiffs then petitioned for relief in the Superior Court.
Over the course of several years, plaintiffs’ tax appeal cases were consolidated as they
wound their way through the normal course of litigation. Ultimately, after the parties submitted
an agreed statement of facts, a justice of the Superior Court granted plaintiffs the relief for which
6
Because the Balmuths did not submit an annual account specifying the fair market value of
their property as of December 31, 2009, with respect to tax year 2010, only the taxes assessed on
the Qua Property and the Antle Property are before this Court.
7
Notwithstanding the Balmuths’ lack of an annual account for tax year 2010, plaintiffs complied
with all the procedural and timing requirements necessary to perfect a tax appeal under chapter 5
of title 44. For example, plaintiffs timely paid the taxes due on their properties for tax years
2009 and 2010.
-4-
they had petitioned. The trial justice found that plaintiffs could challenge defendant’s tax
assessments for tax years 2009 and 2010 using the fair market values of their properties as of
December 31, 2008 and December 31, 2009, respectively. He concluded that, contrary to
defendant’s interpretation of the language set forth in §§ 44-5-15 and 44-5-26 (language we will
discuss infra), plaintiffs were not confined to the December 31, 2007 valuations. The trial justice
reasoned that, under § 44-5-30, plaintiffs had satisfied the preconditions necessary to prevail on
their tax appeals. Citing § 44-5-30, he wrote:
“For judgment to enter in favor of the taxpayer challenging [a]
property tax assessment, the taxpayer must demonstrate: (1) that an
account has been given; (2) that the tax has been assessed in excess
of the property’s full and fair cash value; and (3) that the taxes on
the property have been paid prior to judgment entering.”
Section 44-5-30 provides, in pertinent part, that:
“If the taxpayer has given in an account, and if on the trial of the
petition, either with or without a jury, it appears that the taxpayer’s
real estate * * * has been assessed * * * at a value in excess of its
full and fair cash value, * * * the court shall give judgment that the
sum by which the taxpayer has been so overtaxed, * * * with his or
her costs, be deducted from his or her tax * * *.”
Seizing on the use of “shall” in that statute, the trial justice determined that he was bound to
enter judgment in plaintiffs’ favor because they had satisfied their burden under § 44-5-30. He
explained that defendant had even conceded as much, in that there was no dispute that plaintiffs
had (1) given an account; (2) been assessed taxes in excess of their properties’ full and fair cash
value for tax years 2009 and 2010; and (3) timely paid their taxes for tax years 2009 and 2010.
Accordingly, a judgment entered in plaintiffs’ favor.
The defendant timely appealed, posing to this Court a single question of statutory
interpretation: whether, pursuant to chapter 5 of title 44, plaintiffs were locked in to the fair
-5-
market valuations of their properties as of December 31, 2007, when they appealed defendant’s
assessments for tax years 2009 and 2010.
II
Standard of Review
This Court reviews questions of statutory interpretation de novo. Whittemore v.
Thompson, 139 A.3d 530, 540 (R.I. 2016). When we are confronted with a statute that is clear
and unambiguous, we “must interpret the statute literally and must give the words of the statute
their plain and ordinary meanings.” Id. (quoting Cummings v. Shorey, 761 A.2d 680, 684 (R.I.
2000)). If, however, we are presented with an ambiguous statute—one that contains “a word or
phrase * * * susceptible of more than one reasonable meaning[,]” Drs. Pass and Bertherman,
Inc. v. Neighborhood Health Plan of Rhode Island, 31 A.3d 1263, 1269 (R.I. 2011)—then “this
Court will ‘employ our well-established maxims of statutory construction in an effort to glean
the intent of the Legislature.’” In re Proposed Town of New Shoreham Project, 25 A.3d 482,
505 (R.I. 2011) (quoting Town of Burrillville v. Pascoag Apartment Associates, LLC, 950 A.2d
435, 445 (R.I. 2008)).
III
Discussion
Our state’s statutory scheme for local taxation begins with § 44-5-1, which vests in cities
and towns the power to tax. Under § 44-5-1, “[t]he tax is apportioned upon the assessed
valuations as determined by the assessors of the city or town as of December 31 in each year at
12:00 A.M. midnight, the date being known as the date of assessment of city or town
valuations.” Pursuant to § 44-5-13, “[t]he assessors shall assess all valuation and apportion any
tax levy on the inhabitants of the city or town and the ratable property in the city or town
-6-
according to law, and the assessed valuation of the ratable property is made as of the date of
assessment provided in § 44-5-1[.]” 8 “All real property subject to taxation shall be assessed at
its full and fair cash value, or at a uniform percentage of its value, not to exceed one hundred
percent (100%), to be determined by the assessors in each town or city * * *.” Section 44-5-
12(a). With respect to real estate in particular, “[t]he assessors shall make a list containing the
true, full, and fair cash value * * * as defined in []§ 44-5-12 * * * of the ratable estate in the city
or town, placing the real estate [and other assets] in separate columns * * *.” Section 44-5-20.
Before assessing any valuations, though, the tax assessors of all the cities and towns must
comply with the notice provisions set forth in § 44-5-15. 9 Section 44-5-15 also requires the
annual filing of an account by a taxpayer:
“The notices require every person and body corporate liable to
taxation to bring in to the assessors at the time they may prescribe
a true and exact account of all the ratable estate owned or
possessed by that person or body, describing and specifying the
value of every parcel of the real estate as of December 31 in the
year of the last update or revaluation and personal estate as of
December 31 of the tax year * * *.” (Emphasis added.)
8
Certain personal property, however, is
“estimated at the average of the personalty kept on hand or located
in the taxing district during the twelve (12) months ending with the
date of assessment, or the average of any portion of the twelve (12)
months when the business has not been carried on or located in the
taxing district for a year.” Section 44-5-13.
9
More broadly, § 44-5-15 states, in pertinent part, that:
“Before assessing any valuations, the assessors of all the cities and
towns shall cause printed notices of the time and place of their
respective meetings to be posted in four (4) public places in their
respective city or town, for three (3) weeks next preceding the time
of their meeting, and shall advertise in a newspaper with a
statewide circulation jointly, at least once a week for the same
space of time.”
-7-
The account required under § 44-5-15 is a pillar of our local taxation structure; it must be made
under oath, and it serves as a condition precedent to appealing a tax assessment. Section 44-5-
16(a); Whittemore, 139 A.3d at 547. Furthermore, as prescribed by § 44-5-17, “[i]f any person
brings in an account as provided in § 44-5-15, the assessors shall nevertheless assess the person’s
ratable estate at what they deem its full and fair cash value * * *.”
Generally, a taxpayer seeking to appeal a tax assessment with which he or she is
dissatisfied has an exclusive statutory remedy to do so. As § 44-5-27 instructs, that remedy is
provided in § 44-5-26. 10 Under § 44-5-26(a), “[a]ny person aggrieved on any ground whatsoever
by any assessment of taxes against him or her in any city or town * * * may within ninety (90)
days from the date the first tax payment is due, file an appeal in the local office of tax assessment
* * *.” From the local office of tax assessment, the aggrieved taxpayer may appeal to the local
tax board of review and then, if still dissatisfied, file a petition for review in the Superior Court.
Sections 44-5-26(a) and (b). In addition to setting forth the procedural and timing requirements
required to perfect a tax appeal, § 44-5-26 further directs that “[a]ppeals to the local office of tax
assessment are to be on an application[,]” and that “[t]he application shall be in” a particular
form. Section 44-5-26(b); see Appendix. Contained in that form are two provisions that are of
significance to defendant’s position in this appeal. See § 44-5-26(b).
10
In full, § 44-5-27 provides that:
“The remedy provided in § 44-5-26 is exclusive if the taxpayer
owned or possessed any ratable estate at all, except that, in a
proper case, the taxpayer may invoke the equity jurisdiction of the
superior court; provided, that the complaint is filed within three (3)
months after the last day appointed for the payment, without
penalty, of the tax, or the first installment of the tax, if it is payable
in installments. A taxpayer alleging an illegal or void tax
assessment against him or her is confined to the remedies provided
by § 44-5-26, except that the taxpayer is not required to file an
appeal with the local assessor.”
-8-
First, included in the form under the heading “REASON(S) REDUCTION SOUGHT” is
a space in which an aggrieved taxpayer can list his or her property’s “Fair Market Value (as of
December 31 in the year of the last update or revaluation for real estate and as of December 31
of the tax year for personal estate * * *)[.]” (Emphasis added.) Next, below the form’s signature
block and under the heading “TAXPAYER INFORMATION ABOUT APPEAL
PROCEDURE[,]” the form informs the taxpayer, in pertinent part, that:
“You may appeal your assessment if your property is: (1)
OVERVALUED (assessed value is more than the fair market
value as of December 31 in the year of the last update or
revaluation for real estate and as of December 31 of the tax year
for personal estate for any reason, including clerical and data
processing errors * * *).” (Emphasis added.)
Finally, rounding out the maze of local taxation statutes is § 44-5-30, entitled “Judgment
on petition where taxpayer has filed account.” Section 44-5-30 provides, in pertinent part, that:
“If the taxpayer has given in an account, and if on the trial of the
petition, either with or without a jury, it appears that the taxpayer’s
real estate * * * has been assessed * * * at a value in excess of its
full and fair cash value, * * * the court shall give judgment that the
sum by which the taxpayer has been so overtaxed, * * * with his or
her costs, be deducted from his or her tax * * *.”
Turning to the merits of this appeal, defendant and plaintiffs offer differing
interpretations of the above-quoted sections contained within chapter 5 of title 44. Stressing the
language of those statutes and of the form required by § 44-5-26(b), defendant argues that, when
plaintiffs appealed his assessments for tax years 2009 and 2010, they were restricted to the
valuations of their properties as of December 31, 2007, the date of Portsmouth’s last revaluation.
In support of that interpretation, defendant focuses on two statutory provisions, both of which
refer to the fair market value of property “as of December 31 in the year of the last update or
revaluation.” Specifically, defendant directs us to § 44-5-15, which requires the annual filing of
-9-
an account stating the value of “real estate as of December 31 in the year of the last update or
revaluation[,]” and the form required by § 44-5-26(b), which refers twice to the fair market value
of real estate “as of December 31 in the year of the last update or revaluation[.]” According to
defendant, those provisions, when read together with the other sections of chapter 5 of title 44,
mandate that plaintiffs must base their tax appeals on the valuations of their properties as of
December 31, 2007.
The plaintiffs disagree. To support their position that the law permits a challenge to
defendant’s tax assessments using annual valuations, they first point to this Court’s opinion in
Wickes Asset Management, Inc. v. Dupuis, 679 A.2d 314 (R.I. 1996). It is true that, in Wickes,
we held that “a property owner disputing an assessment carried over from a prior year is not
precluded from challenging the assessment and is therefore not necessarily ‘locked into’ that
value until the next decennial revaluation * * *.” Wickes, 679 A.2d at 320. Indeed, the guiding
principle of Wickes was that, under the statutory scheme in place at that time, “the Legislature
ha[d] provided interim remedies for a person aggrieved by an annual tax assessment.” Id. As
the Court noted, those interim remedies were set forth in §§ 44-5-26 and 44-5-27. Id.
However, it is significant that, at the time Wickes was decided, revaluations of real
property were conducted every ten years. See Wickes, 679 A.2d at 320. As defendant correctly
points out, that has since changed. In 1997, a year after Wickes, the General Assembly
overhauled the revaluation process, enacting P.L. 1997, ch. 179, § 1 (later codified as §§ 44-5-
11.5, 44-5-11.6, and 44-5-11.7). Under the new revaluation statute, rather than requiring cities
and towns to conduct revaluations every ten years, the General Assembly mandated that “each
city and town shall conduct a revaluation within nine (9) years of the date of the prior revaluation
- 10 -
and shall conduct an update of real property every three (3) years from the last revaluation.” P.L.
1997, ch. 179, § 1; see § 44-5-11.6(a)(2)(i)-(ii).
The transition to a more frequent revaluation-and-update schedule was based on a
detailed list of legislative findings. Among other things, the General Assembly recognized that
the old ten-year revaluation led to inequitable results for taxpayers. As the General Assembly
explained,
“The state’s ten year property revaluation cycle is the longest
revaluation cycle in the country. Infrequent revaluations translate
into disparities in property tax burden between types and classes of
property within and among cities and towns. In addition, because
each city and town represents multiple systems and procedures for
administering the property tax, there is an inconsistent
administration of property tax law and regulations.” P.L. 1997, ch.
179, § 1; see § 44-5-11.5(2).
In the view of the General Assembly, the shift to a more frequent revaluation-and-update
schedule struck a balance between “ensur[ing] that all taxpayers in Rhode Island are treated
equitably” and minimizing the administrative burden placed on cities and towns tasked with
conducting more frequent valuations. P.L. 1997, ch. 179, § 1; see § 44-5-11.5(3). According to
the General Assembly, “[e]nsuring that taxpayers are treated fairly begins with modernizing the
administration of the property tax that ensures:
“(a) Up-to-date property values are maintained through more
frequent property revaluations;
“(b) Cities and towns meet defined standards related to performing
updates of property values;
“(c) The state shares in the cost of performing updates of property
values in the cities and towns;
“(d) A meaningful and effective method of ensuring that cities and
towns comply with the nine year revaluation cycle and the updates
of property values are developed;
“(e) Procedures for administering the property tax are standardized
— such as general reporting and classification systems;
“(f) Assessors and contracted property revaluation companies meet
appropriate qualifications and standards; and
- 11 -
“(g) Intergovernmental cooperation in the administration of the
property tax is maximized.” P.L. 1997, ch. 179, § 1; see § 44-5-
11.5(3). 11
Since that overhaul in 1997, the nine-year revaluation schedule and the three-year update
schedule have largely remained the same.
Another change in the law further impacts reliance on our holding in Wickes. In 2001,
the General Assembly amended both § 44-5-15 and the language in the form required by § 44-5-
26(b). See P.L. 2001, ch. 365, § 1. Those amendments added the phrase “as of December 31 in
the year of the last update or revaluation” for real estate to portions of § 44-5-15 and the form
required by § 44-5-26(b). 12 Id. In light of the 1997 overhaul and the 2001 amendments,
plaintiffs’ reliance on Wickes as binding authority in this case is considerably weakened. On this
point, we agree with defendant that perhaps the trial justice should not have relied on Wickes to
the extent he did. However, that does not resolve the question of statutory interpretation at hand.
Even with this Court’s holding in Wickes being of doubtful value here, what remains unclear is
whether plaintiffs are, as defendant argues, confined to the values of their properties as of
December 31, 2007. Based on our thorough review of the language contained in chapter 5 of
title 44, the only thing that appears clear to us now is just how unclear the conflicting statutory
language is.
11
The subsections’ labels have since changed. As currently constituted, § 44-5-11.5, which
contains the list of legislative findings, labels the subsections of § 44-5-11.5(3) with roman
numerals in place of alphabetical letters. See §§ 44-5-11.5(3)(i)–(vii).
12
Prior to 2001, the language of § 44-5-15 and the form required by § 44-5-26(b) made no
mention of the value of real estate as of December 31 “in the year of the last update or
revaluation.” See P.L. 2001, ch. 365, § 1 (adding to § 44-5-15 the phrase “as of December 31 in
the year of the last update or revaluation” after the language “describing and specifying the value
of every parcel of the real estate” and adding to a parenthetical of one provision of the form
required by § 44-5-26(b) that the taxpayer state the fair market value “as of December 31 in the
year of the last update or revaluation for real estate” and adding that same phrase—“in the year
of the last update or revaluation for real estate”—to another parenthetical).
- 12 -
For example, § 44-5-1—the statute that empowers cities and towns to tax—provides in
succinct and unambiguous language that “[t]he tax is apportioned upon the assessed valuations
as determined by the assessors of the city or town as of December 31 in each year at 12:00 A.M.
midnight, the date being known as the date of assessment of city or town valuations.” (Emphasis
added.) A plain reading of that language would suggest that plaintiffs’ position is correct: they
may challenge the valuations of their properties “as of December 31 in each year[,]” freeing
them from the bonds of the December 31, 2007 valuations. On the other hand, we are confronted
with the language of § 44-5-15 and that in the form required by § 44-5-26(b). In each of those
places there is language providing that taxpayers state the value of their real estate “as of
December 31 in the year of the last update or revaluation * * *.”
Also, it does not escape our notice that, in accordance with the 2001 amendments to § 44-
5-15 and to the form required by § 44-5-26(b), taxpayers must state the value of their personal
estate “as of December 31 of the tax year,” providing fertile ground for an argument that the
General Assembly intended to treat the valuation of real estate and personal estate differently.
See §§ 44-5-15 and 44-5-26(b); see also P.L. 2001, ch. 365, § 1. A plain reading of those
amendments lends support to defendant’s argument that plaintiffs are able to challenge their tax
assessments only by using the fair market value as of December 31, 2007, the date of the last
revaluation before their challenges. Unfortunately, the conflict between the language of § 44-5-1
and that of § 44-5-15 and the statutory form required by § 44-5-26(b) is only the most glaring,
but not the sole, ambiguity lurking in chapter 5 of title 44.
To cloud matters further, there is also the language of § 44-5-12(a), which states that
“[a]ll real property subject to taxation shall be assessed at its full and fair cash value, * * * to be
determined by the assessors in each town or city[.]” And, lest we forget, the language of § 44-5-
- 13 -
13—that “[t]he assessors shall assess all valuation and apportion any tax levy on the inhabitants
of the city or town and the ratable property in the city or town according to law, and the assessed
valuation of the ratable property is made as of the date of assessment provided in § 44-5-1”—and
the language of § 44-5-30—which instructs that “the court shall give judgment” in favor of the
taxpayer
“[i]f the taxpayer has given in an account, and if on the trial of the
petition [filed pursuant to § 44-5-26], * * * it appears that the
taxpayer’s real estate * * * has been assessed, if assessment has
been made at full and fair cash value, at a value in excess of its full
and fair cash value * * *.”
Those provisions add further uncertainty to the resolution of the issue at hand; that is, whether
the General Assembly intended that plaintiffs be locked in to the December 31, 2007 valuations
per chapter 5 of title 44.
Therefore, it is readily apparent that we are faced with ambiguous statutory language.
We can reach no other conclusion than that the inartful drafting of the pertinent statutory
language here renders it plainly “susceptible of more than one reasonable meaning.” See Drs.
Pass and Bertherman, Inc., 31 A.3d at 1269. As explained above, because we are confronted
with a genuine ambiguity, and not one divined by crafty lawyering, 13 we “will ‘employ our well-
established maxims of statutory construction in an effort to glean the intent of the Legislature.’”
In re Proposed Town of New Shoreham Project, 25 A.3d at 505 (quoting Pascoag Apartment
13
As this Court previously has observed,
“Because ambiguity lurks in every word, sentence, and paragraph
in the eyes of a skilled advocate * * * the question is not whether
there is an ambiguity in the metaphysical sense, but whether the
language has only one reasonable meaning when construed, not in
a hypertechnical fashion, but in an ordinary, common sense
manner.” In re Proposed Town of New Shoreham Project, 25 A.3d
482, 505 n.30 (R.I. 2011) (quoting Lazarus v. Sherman, 10 A.3d
456, 464 (R.I. 2011)).
- 14 -
Associates, LLC, 950 A.2d at 445). One such rule is of particular relevance here: “‘taxing
statutes are to be strictly construed’ with doubts resolved in favor of the taxpayer.” Maggiacomo
v. DiVincenzo, 122 R.I. 615, 618, 410 A.2d 1332, 1333 (1980) (quoting Van Alen v. Stein, 119
R.I. 347, 359, 376 A.2d 1383, 1389 (1977)); see also Inn Group Associates v. Booth, 593 A.2d
49, 55 (R.I. 1991) (explaining that “[d]oubts as to the construction of [taxing] laws * * * are to
be resolved in favor of the taxpayer” (quoting Potowomut Golf Club, Inc. v. Norberg, 114 R.I.
589, 592, 337 A.2d 226, 227 (1975))).
As belabored above, there is no shortage of doubt about whether the General Assembly
intended to restrict plaintiffs to the values of their properties as of December 31, 2007, the year
of the revaluation at issue. Unfortunately, neither the 2001 amendments to § 44-5-15 and the
form required by § 44-5-26(b), adding the phrase “in the year of the last update or revaluation[,]”
nor the legislative findings contained in § 44-5-11.5 are determinative in discerning legislative
intent. On one hand, as defendant argues, perhaps by virtue of the 2001 amendments, the
General Assembly intended to lock in taxpayers like plaintiffs to the December 31, 2007
valuations. But, on the other hand, perhaps, as plaintiffs argue, in enacting those amendments,
the General Assembly simply intended for tax assessors such as defendant to be allowed to use
those valuations as a carry-forward, easing the administrative burden of conducting yearly
valuations while still affording taxpayers with the opportunity to pursue tax appeals on an annual
basis using annual valuations. The language of the pertinent statutes does not resolve our
linguistic dilemma.
Accordingly, based on the ambiguities created by the conflicting statutory provisions
quoted above and the lack of clear legislative intent to the contrary, we hold that plaintiffs had
the right to appeal the yearly tax assessments for tax years 2009 and 2010 based on the fair
- 15 -
market valuations of their properties as of December 31, 2008 and December 31, 2009. See Inn
Group Associates, 593 A.2d at 55; Maggiacomo, 122 R.I. at 618, 410 A.2d at 1333. In other
words, when plaintiffs appealed defendant’s assessments for tax years 2009 and 2010, they were
not locked in to the December 31, 2007 valuations of their properties.
In so holding, we are cognizant of defendant’s reliance on alternative canons of statutory
construction to support his position. He argues first that the specific provisions of § 44-5-15 and
the form required by § 44-5-26(b) should control over the general provisions of §§ 44-5-1 and
44-5-12. See, e.g., Whitehouse v. Moran, 808 A.2d 626, 629-30 (R.I. 2002) (explaining that “the
general rule of statutory construction clearly provides that when a statute of general application
conflicts with a statute that specifically deals with a special subject matter, and when the two
statutes cannot be construed harmoniously together, the special statute prevails over the statute of
general application”). In the alternative, defendant maintains that, because the language in § 44-
5-15 and § 44-5-26(b)’s form was added after the language in § 44-5-1 and § 44-5-12, the later
provisions should govern here. See, e.g., State v. Souza, 456 A.2d 775, 781 (R.I. 1983) (stating
that “[o]nly when two statutory provisions are irreconcilably repugnant will a repeal be implied
and the last enacted statute preferred”). As a general matter, we do not disagree that those
canons of statutory construction may prove useful in resolving statutory ambiguities. But, here,
because we are confronted with a tax statute so plainly afflicted with significant ambiguity, we
are firm in our view that we are best guided by the maxim which directs that “‘taxing statutes are
to be strictly construed’ with doubts resolved in favor of the taxpayer.” Maggiacomo, 122 R.I. at
618, 410 A.2d at 1333 (quoting Van Alen, 119 R.I. at 359, 376 A.2d at 1389). 14
14
As amicus curiae, the Rhode Island League of Cities and Towns weighed in on the issue
presented by this appeal. It argued in defendant’s favor, predicting that an interpretation in
plaintiffs’ favor would ensure a slippery slope into perilous terrain, where local town and city
halls would be inundated with tax appeals. The dissent too cautions of such a descent into fiscal
- 16 -
Moreover, we “presume[] that the General Assembly knows the state of existing relevant
law when it enacts or amends a statute.” Power Test Realty Company Limited Partnership v.
Coit, 134 A.3d 1213, 1222 (R.I. 2016) (quoting Retirement Board of Employees’ Retirement
System of Rhode Island v. DiPrete, 845 A.2d 270, 287 (R.I. 2004)). Further, we have held that
the law disfavors repeal by implication. See In re Request for Advisory Opinion from House of
Representatives (Coastal Resources Management Council), 961 A.2d 930, 935-36 n.7 (R.I.
2008). Clearly, when the General Assembly amended § 44-5-15 and the statutory form
contained in § 44-5-26(b), it could have repealed or amended any statute that was contradictory
or conflicting. It chose not to do so.
IV
Conclusion
Because we hold that the plaintiffs were permitted to appeal the yearly tax assessments
for tax years 2009 and 2010 based on the fair market valuations of their properties as of
December 31, 2008 and December 31, 2009, we affirm the judgment of the Superior Court. The
papers shall be returned to that court.
disarray. Besides noting that appealing a tax assessment is in and of itself rather cost-
prohibitive, we nonetheless conclude that such a policy concern is best addressed by the General
Assembly, not this Court. Here, the concern with a hypothetically possible flood of tax appeals
does not overcome our view that the ambiguities lurking in the statutes must be resolved in the
taxpayers’ favor. See Inn Group Associates v. Booth, 593 A.2d 49, 55 (R.I. 1991); Maggiacomo
v. DiVincenzo, 122 R.I. 615, 618, 410 A.2d 1332, 1333 (1980). In any event, we pause to thank
the Rhode Island League of Cities and Towns for their thoughtful arguments on the interpretation
of the pertinent provisions of chapter 5 of title 44.
- 17 -
Justice Indeglia, with whom Chief Justice Suttell joins, dissenting. Our review of the
relevant tax statutes leads us to conclude that real estate property taxpayers are not entitled to
appeal the valuation of their property each year, but may only challenge it “in the year of the last
update or revaluation * * *.” General Laws 1956 § 44-5-15. Therefore, we respectfully dissent.
We do agree with the majority that the conflicting statutory language in §§ 44-5-1, 44-5-12(a),
44-5-13, and 44-5-15, and the form required by § 44-5-26(b), is inarticulately drafted and
ambiguous, requiring us to employ our maxims of statutory construction. What we disagree with
is the construction tool used by the majority in its attempt to solve this problem.
In 1997, the General Assembly changed the property tax value scheme from the
requirement that the revaluation of real property occur every ten years to requiring that it be
updated every three years. 1 See P.L. 1997, ch. 179, § 1. As outlined in the legislative findings
cited by the majority, one of the purposes of the statutory amendments was to prevent a drastic
change in taxpayers’ property values at the time of revaluation. See § 44-5-11.5(3)(i) (“Ensuring
that taxpayers are treated fairly begins with modernizing the administration of the property tax
that ensures * * * [u]p-to-date property values are maintained through more frequent property
revaluations * * *.”).
Then in 2001, the General Assembly amended both § 44-5-15 and the language in the
form required by § 44-5-26(b). 2 Section 44-5-15 now reads, in pertinent part:
“The notices require every person * * * liable to taxation to bring
in to the assessors at the time they may prescribe a true and exact
account of all the ratable estate owned * * * describing and
specifying the value of every parcel of the real estate as of
December 31 in the year of the last update or revaluation and
1
More specifically, municipalities must conduct a full revaluation every nine years and conduct
an update every three years. See § 44-5-11.5(4); P.L. 1997, ch. 179, § 1.
2
We acknowledge that the language in § 44-5-15 and the form required by § 44-5-26(b) is
slightly different.
- 18 -
personal estate as of December 31 of the tax year * * *.”
(Emphasis added.)
The form required by § 44-5-26(b) now reads, in pertinent part:
“[The taxpayer] may appeal [their] assessment if [their] property
is: (1) OVERVALUED (assessed value is more than the fair
market value as of December 31 in the year of the last update or
revaluation for real estate and as of December 31 of the tax year
for personal estate * * *) * * *.” (Emphasis added); see P.L. 2001,
ch. 365, § 1.
The confusion in this legislation was caused by the combining of two distinct functions into one
chapter of the general laws. Sections 44-5-1, 44-5-12(a), and 44-5-13 give the local tax assessor
the authority to value all property in the community, while §§ 44-5-15, 44-5-26(b), and 44-5-27
give individual property owners the right to challenge those valuations.
The majority acknowledges that there are at least three rules of construction that could be
utilized: (1) taxing statutes should be strictly construed in favor of the taxpayer; (2) specific
statutes should control over general statutes if they cannot be construed harmoniously together;
and (3) legislation enacted later in time should prevail over earlier inconsistent language. While
the majority relies solely on the first rule, we respectfully suggest that, in this case, the last two
are more appropriate in solving our dilemma and in gleaning the General Assembly’s intent. See
Retirement Board of Employees’ Retirement System of Rhode Island v. DiPrete, 845 A.2d 270,
279 (R.I. 2004) (“When [a] statute is susceptible to more than one plausible interpretation,
however, this Court will endeavor by every rule of statutory construction to ascertain the intent
of the General Assembly.”); State v. Dearmas, 841 A.2d 659, 666-67 (R.I. 2004) (employing
multiple maxims of statutory construction in interpreting a statute). 3
3
The statutory maxim that taxing statutes should be construed in favor of the taxpayer was first
introduced in Manning v. Board of Tax Commissioners of Rhode Island, 46 R.I. 400, 127 A. 865
(1925). This Court stated:
- 19 -
With its 2001 amendments to §§ 44-5-15 and 44-5-26(b) adding the following: “[real]
estate as of December 31 in the year of the last update or revaluation [and personal estate] as of
December 31 of the tax year[,]” the General Assembly made clear when property owners can
appeal a real estate valuation, but left intact the timing of personal property appeals and the
overall authority of the assessor in valuing all property in the community. See P.L. 2001, ch.
365, § 1. This is specific legislation directed at only those choosing to appeal their real estate
valuations and, as such, must be considered as controlling the remaining valuation provisions of
the statute. Likewise, the fact that the 2001 amendment was adopted later than the overall taxing
change of 1997 gives insight to the General Assembly’s attempt to clarify when an appeal can be
taken. Using these two rules of construction convinces us that the General Assembly limited
taxpayer appeals to the year of the last update or revaluation.
We gain comfort in this view when considering the possible ramifications of the
majority’s interpretation. 4 Some taxpayers could seek a revaluation every year, requiring
“Doubts as to the construction of laws of this character are to be
resolved in favor of the taxpayer. The legislative intent to impose
the burden of a tax is not to be found by implication nor
conjecture. Before approving an assessment a court may well
require that its authorization be clearly and explicitly expressed in
the law.” Manning, 46 R.I. at 410, 127 A. at 870.
Similar language has been quoted in Van Alen v. Stein, 119 R.I. 347, 359, 376 A.2d 1383, 1389
(1977), Potowomut Golf Club, Inc. v. Norberg, 114 R.I. 589, 592, 337 A.2d 226, 227 (1975), and
United Transit Company v. Hawksley, 86 R.I. 53, 61, 133 A.2d 132, 136 (1957). This language
seems to suggest that this maxim was meant to be controlling with regard to statutes that impose
a tax. While it is a fine distinction, we note that the present case deals with the procedure of a
tax appeal, rather than the imposition of a tax.
4
In a case with a similar fact pattern to the one before us, another Superior Court justice
addressed this added burden on municipalities and taxpayers, concluding that it would create an
“absurd” result. Transcript of Record at 34-44, Prices Neck LLC v. Booth, Nos. NC-2010-189,
NC-2011-128, NC-2012-120 (R.I. Super. Ct. Feb. 14, 2013). In addition, the justice pointed out
that an interpretation in favor of yearly appeals would solely benefit owners of higher-valued
homes because the potential savings in their situations would make an appeal worthwhile. Id.
- 20 -
municipalities, such as defendant, to expend funds in justifying them. Interpreting the statute in
that manner would unnecessarily burden already strained municipal budgets, ultimately passing
the costs on to taxpayers. Likewise, the loss of revenue, which occurred in this case, would
leave cities and towns attempting to recoup their losses by, again, looking to remaining property
owners. In these times when most owners do not have expendable income, we cannot fathom the
General Assembly wanting to do that.
For these reasons, we must respectfully voice our dissent.
- 21 -
Appendix
STATE OF RHODE ISLAND AND PROVIDENCE PLANTATIONS
SUPREME COURT – CLERK’S OFFICE
OPINION COVER SHEET
Michael A. Balmuth et al. v. David E. Dolce, in his
capacity as Tax Assessor for the Town of Portsmouth.
John Qua et al. v. David E. Dolce, in his capacity as
Title of Case Tax Assessor for the Town of Portsmouth.
William Antle v. David E. Dolce, in his capacity as
Tax Assessor for the Town of Portsmouth.
No. 2017-6-Appeal.
(NC 10-296)
No. 2017-8-Appeal.
(NC 10-298)
No. 2017-9-Appeal.
Case Number
(NC 11-127)
No. 2017-11-Appeal.
(NC 10-299)
No. 2017-12-Appeal.
(NC 11-131)
Date Opinion Filed May 2, 2018
Suttell, C.J., Goldberg, Flaherty, Robinson, and
Justices
Indeglia, JJ.
Written By Associate Justice Francis X. Flaherty
Source of Appeal Newport County Superior Court
Judicial Officer From Lower Court Associate Justice Walter R. Stone
For Plaintiffs:
Michael J. Richards, Esq.
Brian G. Bardorf, Esq.
Attorney(s) on Appeal
Mark B. Bardorf, Esq.
For Defendant:
Kevin P. Gavin, Esq.
SU-CMS-02A (revised June 2016)
SU-CMS-02A (revised June 2016)