Williams & Fickett v. Cnty. of Fresno
218 Cal. Rptr. 3d 362
| Cal. | 2017Background
- Williams & Fickett (taxpayer partnership) was assessed escape and regular personal-property taxes by Fresno County for multiple years based on alleged ownership of farm equipment; taxpayer denied ownership for the relevant lien dates.
- County notified taxpayer in 1997 of the escape assessments and the 60-day right to apply to the county assessment appeals board under Revenue & Taxation Code §1603; taxpayer did not timely file §1603 appeals and did not pay the assessed taxes then.
- County later recorded certificates of delinquency (liens). After audits in 2003 and 2006 produced some refunds, taxpayer sought to clear liens; its 2007 submissions seeking cancellation under §4986 were returned unfiled by the County as untimely §1603 applications.
- Taxpayer paid the disputed taxes in 2012, filed administrative refund claims under §5097 (denied), and then sued under §5140 in 2013 to recover the payments, asserting it did not own the assessed property.
- The trial court sustained the County’s demurrer for failure to exhaust assessment-appeal remedies; the Court of Appeal reversed; the Supreme Court granted review to decide whether the nullity exception excused exhaustion when taxpayer claims nonownership of nonexempt property.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a taxpayer who asserts it did not own assessed (nonexempt) property may bypass timely §1603 assessment appeals and proceed to a §5140 refund action after filing a §5097 refund claim | Parr‑Richmond allows bypassing assessment appeals when taxpayer alleges nonownership; no valuation issue for county board | Statutory scheme and exhaustion principles require initial presentation to county board (§1603) or a §5142(b) stipulation; nullity exception limited to property truly beyond tax authority | Court overruled Parr‑Richmond to the extent it allowed bypass for naked nonownership claims of nonexempt property; taxpayer must pursue §1603 appeal (or obtain §5142(b) stipulation) before a postpayment §5140 action; decision prospective only |
| Whether the nullity exception to exhaustion (allowing immediate judicial review) applies when taxpayer asserts nonownership of nonexempt property | Nonownership is a nullity that removes valuation questions; administrative proceedings add nothing and can be unnecessary | Nullity exception applies only where property is nontaxable, nonexistent, or outside jurisdiction; if property remains taxable, administrative appeal can identify correct owner and avoid duplicate litigation or stale claims | Nullity exception does not extend to simple denials of ownership of property that remains taxable; exception limited to cases where assessment is legally void (e.g., tax‑exempt property or outside jurisdiction) |
| Whether §5142(b) stipulation and other statutory developments mean §1603 exhaustion must apply to nonvaluation nonownership disputes | §5142(b) was not meant to convert nonownership claims into §1603 matters; refund (§5097) and cancellation (§4986) processes suffice | §5142(b) and later statutes show legislative intent to have county boards address nonvaluation issues first or to allow stipulation to substitute for §1603 filing | Majority: §5142(b) and statutory changes support requiring county board review (or stipulation) before court; concurrence dissented on statutory/constitutional grounds but concurred in judgment prospectively |
| Whether the decision should be applied retroactively to Williams & Fickett | Parr‑Richmond was a binding precedent on which taxpayers reasonably relied | Overruling Parr‑Richmond retroactively would unfairly strip parties of reliance‑based expectations | Court applies the new rule prospectively only; Williams & Fickett may proceed consistent with prospective application |
Key Cases Cited
- Steinhart v. County of Los Angeles, 47 Cal.4th 1298 (2010) (exhaustion requirement in property tax refund cases and assessment appeal framework)
- Stenocord v. San Francisco, 2 Cal.3d 984 (1970) (nullity exception to exhaustion for tax assessments that are legally void)
- Parr‑Richmond Industrial Corp. v. Boyd, 43 Cal.2d 157 (1954) (previously allowed bypassing assessment appeal when taxpayer claimed nonownership; overruled insofar as it applied to nonexempt property)
- Brenner v. Los Angeles, 160 Cal. 72 (1911) (nullity doctrine applied where property was plainly nontaxable and taxpayer lacked notice)
- Security‑First National Bank v. County of Los Angeles, 35 Cal.2d 319 (1950) (limits on nullity exception where property is of a taxable nature)
- Star‑Kist Foods, Inc. v. Quinn, 54 Cal.2d 507 (1960) (narrow application of nullity exception when facts undisputed and no valuation issues exist)