28 N.J. Tax 408
N.J. Tax Ct.2015Background
- For tax year 2014 the City of Elizabeth assessor raised assessments on 212 Class 4C apartment properties (out of ~608 Class 4C in the city); defendants own 52 of those 212 and appealed to the County Board of Taxation.
- The County Board voided the 2014 increases for failure to file a compliance plan under N.J.S.A. 54:4-23 (Chapter 101); the city appealed to Tax Court and moved for partial summary judgment to reinstate assessments.
- The assessor did not provide the written pre-notice or submit an approved compliance plan before altering the Class 4C assessments; the assessor used an income-capitalization approach and adjusted ~35% of Class 4C units.
- Defendants moved to dismiss the city’s complaints (seeking to affirm the Board); they argued Chapter 101 procedures were required and also asserted Equal Protection/Due Process/spot-assessment claims (the latter later called premature).
- The Tax Court concluded (1) the 212 properties constituted a "part/portion" of the taxing district and the assessor performed a "reassessment" under N.J.S.A. 54:4-23; (2) assessment-maintenance practice does not automatically excuse Chapter 101 procedural requirements; (3) the assessor violated Chapter 101 by not giving notice and not submitting a compliance plan; (4) the city may still pursue discrimination claims de novo in Tax Court; and (5) the record was insufficient to resolve whether the changes were unconstitutional spot assessments.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the 212 Class 4C changes are a "part of" / "portion of" the taxing district requiring Chapter 101 procedures | The changes were scattered citywide and reflect routine assessment maintenance, not a reassessment of a neighborhood or portion | The changes affected a substantial share of a specific property class (212 of 608 Class 4C ≈ 35%) and thus trigger Chapter 101 notice/compliance-plan requirements | Held: The set of 212 Class 4C properties constituted a "part/portion" (including a substantial number of a property class) and Chapter 101 procedures apply |
| Whether the assessor’s actions constituted a "reassessment" under N.J.S.A. 54:4-23 | Not a reassessment—only assessment maintenance updating values under yearly duties | It was a reassessment: class-wide review, parcel-by-parcel analysis, income-cap approach, and revised taxable values carried to 2014 roll | Held: The assessor performed a reassessment as defined by precedent and practice, so Chapter 101’s reassessment rules apply |
| Whether assessment-maintenance practice excuses prior notice and submission/approval of a compliance plan | Assessment maintenance is part of N.J.S.A. 54:4-23 duties and does not relieve assessor of other statutory obligations; compliance-plan requirement applies only when reassessment affects a neighborhood or substantial class? | City urged maintenance excuse where changes are not geographically concentrated; defendants said any multi-parcel change can trigger Chapter 101 | Held: Assessment maintenance does not automatically excuse the Chapter 101 procedures; where changes affect a neighborhood or a substantial number of properties in a classification, notice and a compliance plan are required; assessor violated Chapter 101 here |
| Whether the city may raise discrimination claims (N.J.S.A. 54:51A-6) in Tax Court despite not having raised them before the County Board | City: Tax Court conducts de novo review; affirmative discrimination claims can be raised there even if not presented to the Board | Defendants: City should be barred for failing to present claims to the Board and equity ("square corners") should preclude permitting claims when assessor failed to follow Chapter 101 | Held: City may pursue discrimination claims de novo in Tax Court; failure to present before the Board does not preclude Tax Court claims; square-corners equitable bar not applied here |
| Whether the increased assessments are unconstitutional spot assessments (Equal Protection / Due Process) | City denied spot-assessment claim; argued assessment maintenance legitimate | Defendants alleged spot-assessing and constitutional violations | Held: Record insufficient; summary judgment denied on constitutional spot-assessment claims—factfinding required |
Key Cases Cited
- Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520 (1995) (summary-judgment standard adopted and explained)
- Tri-Terminal Corp. v. Borough of Edgewater, 68 N.J. 405 (1975) (assessor duty to keep tax rolls current; assessment maintenance principles)
- F.M.C. Stores Co. v. Borough of Morris Plains, 100 N.J. 418 (1985) (discrimination in taxation not tolerated; Chapter 123/constitutional equality principles)
- Van Decker v. Township of West Milford, 120 N.J. 354 (1990) (constitutional right to equality in property taxation; uniformity principles)
- J.C. Chap. Prop. Owners Ass'n v. City Council, 55 N.J. 86 (1969) (statutory construction should effectuate legislative objectives and common sense)