ORDERS:
ORDER AND DECISION
STATEMENT OF THE CASE
This is a contested case brought by Bridge Creek Associates (ATaxpayer@) against
the Richland County Assessor (AAssessor@). This matter involves the denial of the Taxpayer's
application, as untimely, for a multiple lot discounted value for the 1996 tax year. The parties
exhausted all prehearing remedies with the Richland County Board of Assessment Appeals.
Jurisdiction is granted to the Administrative Law Judge Division by S.C. Code Ann.
§ 12-60-2540 (Supp. 1996).
ISSUE
A hearing was held in this matter on April 8, 1997 to determine whether the time for
filing an application for discounted value, pursuant to S.C. Code Ann. § 12-43-224, should be
extended, where the Assessor mailed the application for discounted value to the previous owner,
rather than to the Taxpayer, even after the Taxpayer supplied the Assessor's office with its new
address.
FINDINGS OF FACT
1. The Richland County Board of Assessment Appeals (ABoard@) issued a written
decision on December 16, 1996 denying Taxpayer's application, as untimely, for a multiple lot
discounted value for the 1996 tax year pursuant to S.C. Code Ann. § 12-43-224 (Supp. 1996).
2. The Taxpayer appealed the Board's decision to this tribunal on December 27,
1996.
3. The Taxpayer owns ten or more unsold lots, within a homogeneous area, the
Woodlake Subdivision, as specifically referenced in Petitioner's Exhibit #4. The Taxpayer
applied for the multiple lot discounted value pursuant to S.C. Code Ann. § 12-43-224 for these
lots on May 28, 1996.
4. In February of 1996, the Assessor mailed an application for multiple lot
discounted value to Bridge Creek Associates at 1 Smallwood Circle, Columbia, South Carolina
29223, which is the address of the previous owner of the lots.
The unsold lots in question Achanged hands@ in 1994 through a business transaction in
which the investment interests were sold to new investors, who now constitute the Taxpayer.
The Taxpayer, as new owner, bearing the same name as the previous owner, ABridge Creek
Associates," notified the Assessor of its new address shortly thereafter: 317 Bridge Creek Drive,
Columbia, South Carolina 29223.
5. The change of address for the Taxpayer was registered in the mainframe computer
of the Assessor, but was not registered in the B-20 system. As a result, the Taxpayer received
various correspondence from the Assessor and/or Richland County at its correct address.
Mailings which resulted from the mainframe computer were mailed to the correct address.
However, the B-20 system lists the addresses of developers to which the Assessor mailed the
applications for the discounted value. Since, the Taxpayer's address was not updated in the B-20
system, the Taxpayer did not receive an application by mail.
In the first few years after the enactment of S.C. Code Ann. § 12-43-224, and as a
courtesy since many developers were not taking advantage of the discount, the Assessor
developed a data base on the B-20 system of developers who previously qualified for the
discount. The Assessor also places a notice in the legal advertising section of The State five
times prior to the May 1st deadline of the tax year to remind taxpayers of the availability of
multiple lot discounts and the deadline for making application.
6. The discounted valuation had been applied to various unsold lots in the Woodlake
Subdivision, under the management and ownership of Bridge Creek Associates, from 1989
through 1995. During this time, B. Deas Manning, current manager and developer, was directly
or indirectly involved in securing the discount, as application had to be made each year.
7. Through his involvement with Bridge Creek Associates and other developments,
Mr. Manning was familiar with the process of applying for the discounted value.
8. In February of 1996, the Assessor mailed the application for the discounted value
to the previous owner of the development. Mr. Manning received the application from the
previous owner on May 8, 1996, which was after the May 1st deadline for 1996 tax year. On
May 8, 1996, Mr. Manning requested an extension and was subsequently denied. As previously
stated, Mr. Manning then applied for the discount on May 28, 1996.
CONCLUSIONS OF LAW AND ANALYSIS
1. AGenerally, the proper valuation of realty for taxation is a question of fact, to be
ascertained in each individual case in the manner prescribed by statute." 84 C.J.S. Taxation §
411 at 793 (1954).
2. The statute dispositive of the issue in this case, S.C. Code Ann. § 12-43-224,
provides:
Notwithstanding the requirement that real property is required by
law to be appraised at fair market value for ad valorem tax
purposes, when undeveloped acreage is surveyed into subdivision
lots and the conditional or final plat is recorded with the
appropriate county official, the county assessor shall appraise each
lot as an individual property and then discount his gross actual
market value estimate of the developer's lot holdings under the
following conditions:
1. The discount rate shall include only:
(a) typical interest rate as charged by developers
within the county to purchasers of lots when the purchase is financed by the developer or,
in the absence of financing by the developer,
the typical interest rate charged by local savings and loan institutions for mortgages on new homes.
(b) the effective tax rate for the tax district that the lots are located in.
2. The developer has ten or more unsold lots within the homogeneous area on the December 31 tax control date.
3. The assessor shall determine a reasonable number of years for the developer to sell the platted lots, however the estimate shall not exceed seven years.
Each of these components shall be based on identifiable factors in
determining AThe Present Worth of Future Benefits@ based on the
discounting process.
Platted lots shall not come within the provisions of this section
unless the owners of such real property or their agents make
written application therefor on or before May 1st of the tax year in
which the multiple lot ownership discounted value is claimed.
The application for the discounted value shall be made to the
assessor of the county in which the real property is located, upon
forms provided by the county and approved by the commission and
a failure to so apply shall constitute a waiver of the discounted
value for that year. (emphasis added.)
3. ABy express provision, application of S.C. Code Ann. § 12-43-224 hinges on
the Taxpayer's application for a discount.@ Lindsey v. S.C. Tax Comm'n, 302 S.C. 274, 275,
395 S.E.2d 184, 185 (1990).
In the case at hand, clearly the Taxpayer did not make application for the discounted
value within the time period required by S.C. Code Ann. § 12-43-224. However, the
Taxpayer contends that the Assessor assumed a legal duty in mailing out the forms for
discounted value even though that statute does not mandate such mailings. The Taxpayer
further contends that since the Assessor erroneously mailed the form to the previous owner of
Taxpayer's property, rather than to Taxpayer, the Assessor is guilty of negligence. Because
the Taxpayer relied on receiving the form from the Assessor in the mail, the Taxpayer
contends that it should be granted an extension. Under the circumstances of this case, three
underlying questions arise: (1) Did the Assessor provide the forms or applications for the
discounted value as required by S.C. Code Ann. § 12-43-224 and (2) Did the Taxpayer's
filing of its application for the discounted value after the deadline of May 1st constitute a
waiver of the discounted value for the 1996 year or (3) Did the Assessor assume a legal duty
to mail out forms for discounted value, thus, excusing Taxpayer's untimely filing for
discounted value?
In addressing the first question, it is necessary to ascertain what the legislature
intended by the language of Section 12-43-224 which states that application for discounted
value must be made Aupon forms provided by the county." In construing this provision, the
language should be given its plain and ordinary meaning without resort to subtle or forced
construction to limit or expand the statute's operation. See Bryant v. City of Charleston, 295
S.C. 408, 368 S.E.2d 899 (1988); Home Health Service v. S.C. Tax Comm'n, 312 S.C. 324,
440 S.E.2d 375 (1994). Further, where terms of a statute are clear and unambiguous, they
must be applied according to their literal meaning. Medlock v. 1985 Ford F-150 Pick Up, et
al., 308 S.C. 68, 417 S.E.2d 85 (1992); Green v. Zimmerman, 269 S.C. 535, 238 S.E.2d 323
(1977).
According to Black's, Aprovide@ is defined as Ato furnish for future use . . . and to
supply." Black's Law Dictionary 1224 (6th ed. 1990). It is clear within the context of this
statute that the legislature intended only that a county be responsible for supplying or making
available the forms or applications for discounted value. Section 12-43-224 does not
mandate that counties mail out applications for discounted value to taxpayers. The Assessor
in this case mailed out applications as a courtesy. The responsibility for securing the form
and making application rests exclusively with the Taxpayer.
The second issue is whether the Taxpayer waived the discounted value for the 1996
tax year by failing to meet the May 1st deadline. Unfortunately, the Taxpayer depended on
receiving the application for discounted value in the mail, as it had in the past. As the
Assessor mailed the application to the wrong address, the Taxpayer did not receive an
application until after the deadline. The Taxpayer and its agent, Mr. Manning, are
sophisticated and familiar with the filing requirements of Section 12-43-224. While Mr.
Manning testified that he was not aware of the May 1st deadline and relied solely on
receiving the application from the Assessor, the error of the Assessor did not preclude the
Taxpayer from securing an application on its own or absolve the Taxpayer of the
responsibility of filing before the deadline. Furthermore, "everyone is presumed to have
knowledge of the law and must exercise reasonable care to protect his interests." Smothers v.
U.S. Fidelity and Guar. Co., __ S.C. __, 470 S.E.2d 858 (Ct. App. 1996). It is very evident
from Section 12-43-224 that the responsibility for filing is squarely on the Taxpayer. See
also Lindsey, supra.
However, the Taxpayer contends that since the Assessor undertook the responsibility
of mailing out the forms, the Assessor thereby assumed a legal duty. Furthermore, it is
contended because the Assessor erroneously mailed an application to the previous owner of
the Taxpayer's property, the Assessor acted negligently. In support of this contention, the
Taxpayer cited, inter alia, Rogers v. United States, 397 F.2d 12 (4th Cir. 1968 ). In Rogers,
the Court stated: "Where an agency of the United States voluntarily undertakes a task, it can
be held to have accepted the duty of performing that task with due care." Id. at 14. On the
other hand, the Court further stated: "Just when the duty is undertaken, when it ends and
what conduct is required, are no where clearly defined, and perhaps cannot be. " Id. at 14,
citing Prosser, Torts § 54 at 340 (3d ed. 1964); see also, 38 Am. Jur. Negligence § 17 (1941).
"Generally, 'duty' is the obligation to conform to a particular standard of conduct
toward another." Shipes v. Piggly Wiggly St. Andrews, Inc., 269 S.C. 479, 482, 238 S.E.2d
167, 168 (1977).
The determination of any question of duty--that is, whether the
defendant stands in such relation to the plaintiff that the law will
impose upon him an obligation of reasonable conduct for the
benefit of the plaintiff-- has been held to be an issue of law for the
court rather than for the jury, to be determined by reference to the
body of statutes, rules, principles and precedents which make up
the law. The court determines, as a matter of law, the existence
and scope or range of the duty--that is, whether the plaintiff's
interest that has been infringed by the conduct of the defendant is
entitled to legal protection.
57 Am. Jur. 2d Negligence § 86 (2d ed. 1989) (emphasis added). Further, "[a]n affirmative
legal duty exists only if created by statute, contract, relationship, status, property interest, or
some other special circumstances." Russell v. City of Columbia, 301 S.C. 117, 119, 390
S.E.2d 463, 465 (1989).
After a review of South Carolina case law, this tribunal is unaware of any precedent
which would impose a duty upon the Assessor under the circumstances of this case. While
the Assessor undertook to mail applications for discounted value to various developers, such
an act does not rise to the level of an assumption of a legal duty. Because the Assessor did
not have a statutory duty to mail out forms, it follows that the Assessor did not breach a duty
by erroneously mailing a form intended for Taxpayer to an incorrect address. See McCall v.
Dept. of Health and Envtl. Control, 315 S.C. 205, 432 S.E.2d 503 (Ct. App. 1993). In the
present case, the Taxpayer is not excused of its responsibility to know the deadline for
claiming the tax benefit and making proper application therefor. Section 12-43-224 does not
authorize the Assessor to grant extensions. Hence, the Taxpayer's application for discounted
value was untimely filed and constitutes a waiver of the discounted value for the 1996 tax
year.
IT IS HEREBY ORDERED that the Taxpayer's application for a multiple lot
discounted value for the unsold lots in the Woodlake Subdivision, identified herein, was
untimely filed and constitutes a waiver for the 1996 tax year.
AND IT IS SO ORDERED.
________________________________
JOHN D. GEATHERS
Administrative Law Judge
Post Office Box 11667
Columbia, South Carolina 29211-1667
May 5, 1997
Columbia, South Carolina |
