Omimex Canada, Ltd. v. State
2015 MT 102
Mont.2015Background
- Omimex Canada, Ltd. operates oil and gas production property in Montana and was centrally assessed by the Department of Revenue (DOR) for tax years including 2004 and 2011.
- Central assessment under § 15-23-101(2), MCA, applies to property operated as a “single and continuous property”; centrally assessed property can be classed as class nine (higher tax rate) vs. class eight for locally assessed oil/gas equipment.
- In 2007 Omimex litigated the 2004 central assessment; Judge Sherlock found Omimex operated a single and continuous property and classified it as class nine, but on appeal this Court (Omimex I) held Omimex lacked a ‘‘major distribution system’’ and reversed as to classification, remanding for entry of an amended judgment; the Court did not decide the central-assessment (single-and-continuous) question.
- Legislature amended classification and central-assessment statutes in 2009 (adding pipelines/pipeline carriers to class nine and to central assessment), but § 15-23-101(2)’s single-and-continuous requirement remained.
- For tax year 2011 DOR again centrally assessed and classed Omimex as class nine; Omimex sued, arguing it is not a pipeline carrier and does not operate a single and continuous property. DOR moved for partial summary judgment asserting issue preclusion based on the 2007 findings.
- The District Court granted partial summary judgment for DOR; the Montana Supreme Court reversed, holding issue preclusion did not bar Omimex from litigating the single-and-continuous question for 2011.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a 2007 finding that Omimex operated a "single and continuous property" precludes relitigation for 2011 | 2007 judgment was vacated on remand and this Court did not decide central-assessment issue; no final judgment on the merits | 2007 findings and judgment establish the issue; collateral estoppel bars relitigation | Reversed: issue preclusion inapplicable — no final, preclusive resolution of the single-and-continuous issue for 2011 |
| Whether Omimex had a full and fair opportunity to litigate the issue previously | Omimex appealed and sought review; the appellate court did not reach the issue, so Omimex lacked appellate review on that ground | Appellate consideration is not required for preclusion where prior litigation afforded full opportunity | Held that opportunity to pursue appeal is part of full and fair opportunity; Omimex did pursue appeal but the appellate court declined to decide the issue, so preclusion is improper |
| Whether the issue in 2011 is identical to the 2004 issue | The assessed property changed (new wells, rerouted flow, acquisitions); annual assessments make each tax year distinct | The prior factual findings remain applicable; identity should be found | Held the 2011 property differed materially; identity of issues not established, so preclusion fails |
| Whether changed statutes (2009 amendments) affect preclusion analysis | Omimex noted statutory changes and different classification framework since 2004 | DOR emphasized statutory changes do not negate 2007 factual finding about operations | Court treated statutory changes as background but focused on issue preclusion and factual differences; preclusion denied due to lack of identical issue and changed facts |
Key Cases Cited
- Omimex Canada, Ltd. v. State, 347 Mont. 176, 201 P.3d 3 (2008) (Omimex I) (appellate decision that reversed class-nine classification and did not reach central-assessment question)
- Baltrusch v. Baltrusch, 331 Mont. 281, 130 P.3d 1267 (2006) (discusses relaxed finality in issue preclusion but explains limits)
- McDaniel v. State, 350 Mont. 422, 208 P.3d 817 (2009) (sets four-element test for issue preclusion)
- Planned Parenthood v. State, 378 Mont. 151, 342 P.3d 684 (2015) (explains identity-of-issues requirement when underlying law or facts change)
- Eagle Commc’ns v. Treasurer of Flathead Cnty., 211 Mont. 195, 685 P.2d 912 (1984) (each tax year is singular and self-contained for assessment)
- Cal. Dep’t of Soc. Servs. v. Thompson, 321 F.3d 835 (9th Cir.) (reversed-vacated judgments cannot serve as basis for collateral estoppel)