Abramson v. Montgomery County

⁷²³ CHASANOW, Judge. This case concerns the rights of a county to appeal an assessment of a taxpayer’s property to the Maryland Tax Court under § 14-512 of the Tax-Property Article. 1 It arises in the context of the 1988 property tax assessment for the White Flint Mall, a major shopping center in Montgomery County. Before turning to the facts of the case, we briefly review the relevant aspects of the current property tax assessment system. I. Real property is typically reassessed every three years, unless there are certain intervening circumstances such as zoning or use changes. § 8-104(b)-(c).

Each county’s Supervisor of Assessments has the responsibility of assessing all real property in the county subject to property tax. § 8-202. 2 Section 8-401(a) requires the Supervisor, an employee of the State Department of Assessments and Taxation, to provide the property owner with notice of any proposed change in the value or classification of real property. The notice must inform the owner of the right to appeal and must briefly describe the appeal process. § 8-401(c)(7). A person who receives notice under § 8-401 may protest the proposed assessment to the Supervisor within 45 days from the date of the notice. §§ 8-404 and 14-502(a). In addition, “any taxpayer, a county, a municipal corporation, or the Attorney General may submit a written appeal to the supervisor as to a value or classification in a notice of assessment on or before 45 days from the date of the notice.” § 14-502(a).

Once an appeal is filed, the Supervisor must hold a hearing. §§ 14-502(c) and 8-405. Section 14-510(b) provides that the hearings are informal, and that “any party in interest may submit to the ... supervisor ... any informa ⁷²⁴ tion that bears on the appeal without regard to the technical rules of evidence.” After the Supervisor holds the hearing and considers the evidence presented, the Supervisor issues a final notice of the assessed value of the property. § 8-407(a). 3 The final notice must notify the person who sought review of their right to appeal this final value or classification to the property tax assessment appeal board (PTAAB) where the property is located on or before 30 days from the date of the final notice. §§ 8-407(b) and 14-509(a). Any taxpayer, a county, a municipal corporation, or the Attorney General may also appeal an assessment to the PTAAB within the 30 day period. § 14-509(a). The final administrative level of property tax appeal is the Maryland Tax Court which, despite its name, is an independent administrative arm of the state government.

Maryland Code (1988), Tax-General Article, § 3-102. Section 14-512(f)(l) provides that any taxpayer, municipal corporation, the Attorney General, the Department, or the governing body of a county may appeal to the Tax Court within 30 days after the PTAAB issues its determination or provides appropriate notice as per the statute. Any party to a Maryland Tax Court proceeding may appeal a final decision of the Tax Court to the circuit court for the county in which the property is located. § 14-513. Any party to a proceeding in the circuit court under § 14-513 may appeal a final decision of the circuit court to the Court of Special Appeals. § 14-515.

Finally, this Court may issue a writ of certiorari to the Court of Special Appeals.

II

The facts in this case are straightforward. Taxpayers, the owners of the White Flint Shopping Mall in Montgom ⁷²⁵ ery County, received a proposed assessment for their property of $111,875,960 for the 1988 tax year. Pursuant to §§ 8-404 and 14-502, Taxpayers appealed to the Supervisor of Assessments for Montgomery County. 4 The Supervisor heard their appeal but affirmed the proposed assessment and issued a final notice pursuant to § 8-407. Within the 30-day statutory period, Taxpayers appealed to the Montgomery County PTAAB under § 14-509.

Montgomery County became aware of the scheduled PTAAB hearing and notified the PTAAB by letter that it was a party in interest in the proceedings and intended to participate in the hearing. At the PTAAB hearing, Taxpayers presented evidence that the proper value of the property was $109,000,000, while Montgomery County presented evidence that the property’s proper value was $152,381,800. The Supervisor defended its original assessment of $111,875,960. On March 9, 1989, the PTAAB affirmed the Supervisor’s original assessment.

Taxpayers elected to take no further appeal, but Montgomery County appealed the PTAAB’s decision to the Maryland Tax Court seeking an increase in the assessment. The County based its appeal on § 14-512(f)(1). Taxpayers filed three separate motions challenging Montgomery County’s standing to appeal to the Tax Court. All three motions were opposed by the County and denied by the Tax Court.

On September 27, 1990, the Tax Court held a full evidentiary hearing. Taxpayers, through their appraiser, presented evidence to support a reduction in the assessment to $104,286,100. Montgomery County presented evidence through its appraiser to support an increase in ⁷²⁶ the assessment to $130,000,000. The Supervisor presented evidence to support the original $111,875,960 assessment.

On March 27, 1991, the Tax Court issued an order increasing the property’s value for assessment purposes to $130,-000,000. From the decision of the Tax Court, Taxpayers appealed to the Circuit Court for Montgomery County pursuant to § 14-513, contesting only the County’s standing to appeal to the Tax Court. The Circuit Court (William C. Miller, J.) held that Montgomery County had standing to appeal and affirmed the judgment of the Tax Court. Taxpayers appealed from this decision to the Court of Special Appeals pursuant to § 14-515.

We granted certiorari to consider the appropriateness of Montgomery County’s appeal to the Tax Court before the intermediate appellate court could consider the issue. Md.Code (1974, 1989 Repl.Vol., 1992 Cum.Supp.), Courts & Judicial Proceedings Art., § 12-201.

III

The changing role of the counties in property tax assessment and appeals does not lend itself to concise description. It is fair to say, however, that the counties’ power to determine assessments has progressively decreased over time, while their right to appeal assessments set by others has progressively increased. In 1951, all real property in a county was assessed by the county commissioners, and in Baltimore City by an Appeal Tax Court. Former Md.Code (1951), Art. 81, §§ 12 and 28.

The Supervisor of Assessments was responsible for conducting assessments and recommending assessment values to the county commissioners for their approval. Id. § 232. The county commissioners were also charged with hearing protests of these decisions, id. § 242, although they were empowered to appoint a county Appeal Tax Court to hear such protests. Id. § 243.

Any taxpayer, city or the Attorney General could appeal an assessment to the county commissioners, or to the Appeal Tax Court where one was ⁷²⁷ created. Id. § 251. Any taxpayer, city, the Attorney General, or a Supervisor of Assessments “claiming to be aggrieved” by a decision of the county commissioners or Appeal Tax Court could appeal to the State Tax Commission. Id. § 252.

The counties had no right of appeal at these levels because they themselves were establishing the assessments. As for appeals from the decisions of the State Tax Commission, which the counties did not control, any taxpayer, city, the Attorney General, as well as the county commissioners could appeal from a State Tax Commission decision to the Circuit Court or to the “Baltimore City Court of Baltimore City.” Id. § 255. Thus, the counties’ interests were fully represented at all levels of the assessment and appeals process. In 1959, the General Assembly replaced the State Tax Commission with the State Department of Assessments and Taxation (SDAT) and the Maryland Tax Court.

Chapter 757 of the Acts of 1959, § 247A. The powers of the county commissioners over initial assessments were transferred to the Supervisors of Assessments in the counties and the Department of Assessments in Baltimore City, under the supervision of the SDAT. Former Md.Code (1957, 1960 Cum.Supp.), Art. 81, §§ 13 and 232. The county commissioners, or their duly created Appeal Tax Courts, and the Board of Municipal and Zoning Appeals in Baltimore City still heard assessment appeals.

Id. § 255(b). Any taxpayer, any city, the State, or Supervisors of Assessments could appeal from a decision of these local “final assessing authorities” to the Maryland Tax Court. Id. § 256(a). County commissioners also were given the right to appeal to the Maryland Tax Court from any decision of a local Appeal Tax Court.

Id. § 256(a). In 1973, the General Assembly created Property Tax Assessment Appeal Boards (PTAABs) in each county. It removed the jurisdiction of the county commissioners over appeals and gave the power to hear appeals from Supervisors’ assessments to the newly-created PTAABs. Ch. 784 of the Acts of 1973, § 255(b).

Apparently realizing that the ⁷²⁸ combined effect of its 1959 and 1973 actions was to completely shut the counties out of the initial assessment process and the first two levels of appeal (to the Supervisor and the PTAAB) the General Assembly in 1976 gave the counties the right to appeal both to the local Supervisor and to the PTAAB. Ch. 495 of the Acts of 1976, § 255(a)-(b). Although counties no longer had authority to set assessments, their interests were adequately protected by their right to appeal to all three administrative levels of the assessment process — the Supervisor, the PTAAB, and the Tax Court. 5 In 1985, the General Assembly recodified these provisions in the new Tax-Property Article, which controls the case now before us.

IV

Section 14-512(f)(1) of the Tax-Property Article addresses appeals to the Maryland Tax Court from PTAAB decisions. It provides: “(f) Appeals from, property tax assessment appeal board; exhaustion of administrative remedies. — (1) Any taxpayer, a municipal corporation, the Attorney General, the Department, or the governing body of a county may appeal a determination made by a property tax assessment appeal board under § 14-509(a) or (b) of this subtitle to the Maryland Tax Court.” In this language, Taxpayers perceive that Montgomery County’s right to appeal to the Tax Court is conditioned on its being “aggrieved” by the decision of the PTAAB. Although the statute makes no reference to whether a party must be “aggrieved,” Taxpayers find this requirement in ⁷²⁹ the predecessor statute to § 14-512(f)(1), former Article 81, § 256, which provided: “§ 256. Appeals to Maryland Tax Court from property tax assessment appeal board.

(a) In general. — Any taxpayer, any city, or the Attorney General or Department on behalf of the State, or a supervisor of assessments ... or the county commissioners of any county, or on behalf of any chartered county, by either the county council or, if the office exists, by the county executive, claiming to be aggrieved because of any assessment or classification, or because of any [enumerated actions of the PTAAB], may by petition appeal to the Maryland Tax Court____” (Emphasis added). Because the Revisor’s Note to current § 14-512(f) provides that it is derived “without substantive change” from former § 256, Taxpayers claim that the requirement that a party must be “aggrieved” by the PTAAB's decision should be read into current § 14-512(f)(1). Although we have not previously addressed whether a party need be “aggrieved” under § 14-512(f)(l), we have addressed the aggrievement requirement in another statutory context. In Boulden v. Mayor, 311 Md. 411 , 535 A.2d 477 (1988), we construed Md.Code (1957, 1983 Repl.Vol.), Art. 66B, § 4.08(a) dealing with who may appeal to the circuit court from a local board of zoning appeals decision.

Section 4.08(a) provides: “Any person or persons, jointly or severally, aggrieved by any decision of the board of appeals, or by a zoning action by the local legislative body, or any taxpayer, or any officer, department, board, bureau of the jurisdiction, may appeal the same to the circuit court of the county____” (Emphasis added). Chief Judge Murphy, writing for the Court, concluded that although the statute required “any person or persons” to be “aggrieved,” the location of the disjunctive “or” in the statute meant that taxpayers and other parties following the word “or” were not subject to the requirement. Id. at 414, 535 A.2d at 479 . We thus refused in Boulden to read ⁷³⁰ in the word “aggrieved” where it did not exist, and Montgomery County encourages us to refuse to do so in the similar circumstances of the instant case.

See id. at 415 n. 3, 535 A.2d at 479 n. 3. The presence of the Revisor’s Note, though, indeed creates some ambiguity. Nonetheless, we need not resolve this ambiguity today, because even if the statute is read to require that an appellant be “aggrieved,” we believe Montgomery County met the requirement in this case. Y. On the question of who is “aggrieved,” Taxpayers contend that the county may become “aggrieved” by a PTAAB decision in one of only two ways.

First, if a county timely appeals a Supervisor’s final assessment to the PTAAB and asks for an increase, which request the PTAAB rejects, the county is “aggrieved” by the rejection. Second, Taxpayers contend a county may be “aggrieved” without timely appealing to the PTAAB only if the PTAAB reduces a Supervisor’s assessment after a taxpayer’s timely appeal. Taxpayers argué that where a county fails to file a timely appeal and the PTAAB merely affirms the Supervisor’s decision, as is the case here, the PTAAB’s action cannot “aggrieve” the County because it is left in no worse position than when the hearing began. Because the Montgomery County PTAAB merely affirmed the Supervisor’s assessment of $111,875,960, rejecting Taxpayers’ request for a decrease, Taxpayers claim Montgomery County cannot be “aggrieved” by the PTAAB’s decision.

Montgomery County makes three alternative arguments as to why it is entitled to appeal to the Tax Court. First, it contends that the plain language of § 14-512(f)(1), which makes no explicit reference to an “aggrieved” status, renders it a so-called “super-plaintiff” able to appeal to the Tax Court regardless of who appeared or what transpired before the PTAAB. Second, Montgomery County argues that even though it did not file its own timely appeal, it was an “intervenor” in the PTAAB proceeding and, as such, ac ⁷³¹ quired the full rights of a party including the right to appeal, regardless of whether it was “aggrieved.” The County bases this view principally on Montgomery County v. Supervisor, 275 Md. 58, 337 A.2d 679 (1975), where we affirmed the Tax Court’s grant of the county’s motion to intervene in a property tax appeal which made the County “a party ... with all rights incident thereto.” Id. at 62 , 337 A.2d at 681 . Finally, Montgomery County argues that even if the key to a party’s right to appeal is whether it is “aggrieved” by the PTAAB’s decision, the fact that it submitted evidence to the PTAAB supporting a higher assessment, and the fact that the PTAAB ultimately rejected this evidence and affirmed the Supervisor’s proposed assessment, rendered it sufficiently “aggrieved” to appeal to the Tax Court.

Because of our conclusion below that Montgomery County was sufficiently “aggrieved” by the PTAAB decision to enable it to appeal to the Tax Court, we need not reach the County’s first argument, whether a county is a “super-plaintiff” able to appeal to the Tax Court without regard to the earlier proceedings. We also need not determine whether Montgomery County’s participation in the PTAAB hearing gave it “intervenor” status which would allow it to appeal regardless of whether it was “aggrieved.” We might note that Montgomery County could have “intervened” in the more formal proceedings of the Tax Court and circuit court regardless of what happened at the PTAAB had the taxpayer appealed to the Tax Court or circuit court, Montgomery County v. Supervisor, 275 Md. 58, 62 , 337 A.2d 679, 681 (1975) (Tax Court properly permitted county to intervene in tax appeal); Maryland Nat’l Capital Park & Planning Comm’n v. Washington Nat’l Arena, 30 Md.App. 712 , 718, 354 A.2d 459 , 462 (1976) (State as well as county should have been permitted to intervene in property tax dispute in circuit court), rev’d on other grounds, 282 Md. 588 , 386 A.2d 1216 (1978) (reversing on issue of enforceability of contract clause waiving right to challenge future tax assessments). A PTAAB hearing is, ⁷³² however, “informal.” § 14-510(b); see also COMAR 14.10.-01.05(E)(1) (“The [PTAAB] Board shall conduct the hearing in an informal manner.”); § 14-510(b) (“[a]ny