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Legal Update: Supreme Court Clarifies Signature Requirements for Property Tax Abatement Applications
The New Hampshire Supreme Court recently affirmed a decision by the Board of Tax and Land Appeals (the “BTLA”), and in doing so provided further insights on the BTLA requirement that taxpayers personally sign real property tax abatement applications. See, Appeal of Keith R. Mader 2000 Revocable Trust, et al., Docket No. 2020-053, 2021 N.H. LEXIS 153 (Oct. 8, 2021).
In February 2018, a group of eighteen taxpayers (the “Taxpayers”), owners of a condominium development, engaged counsel to represent them in filing real property tax abatement applications with the Town of Bartlett. The Town denied their abatement requests and the Taxpayers then appealed to the BTLA.
Under the BTLA Rules, a taxpayer is required to sign the local abatement application. N.H. Admin. R., Tax 203.02. In this case, the Taxpayers acknowledged to the BTLA that they had not personally signed the applications – rather, their attorney had signed them. The Taxpayers argued, however, that the omissions were “due to reasonable cause and not willful neglect,” and thus could proceed, noting that counsel was not formally retained until close to the filing deadline and all but one of the Taxpayers lived out-of-state. The BTLA declined to grant an exception to the signature requirement and dismissed the appeals, finding that the petitioners failed to comply with Rule 203.02, and had not shown the failure was “due to reasonable cause and not willful neglect.” The Taxpayers appealed the BTLA’s dismissal to the New Hampshire Supreme Court.
In Appeal of Keith R. Mader 2000 Revocable Trust, et al., 173 N.H. 362 (2020), the Supreme Court held that the “reasonable cause and not willful neglect” exception to the BTLA’s signature requirement permitted abatement appeals to be filed with the BTLA despite the lack of a taxpayer’s signature and certification, if the taxpayer can show that it was not reasonably possible to submit the application with the taxpayer’s signature despite “exercising ordinary business care and prudence” and that the taxpayer “was not recklessly indifferent to the signature and certification requirement in preparing the application.” The Supreme Court vacated the BTLA’s dismissal of the Taxpayers’ appeals and remanded for further proceedings consistent with their construction of Rule 203.02(d).
On remand, the BTLA found that the Taxpayers did not exercise “ordinary business care and prudence” in filing their applications. Noting that the Taxpayers knew of their property assessments no later than December 1, 2017, the BTLA concluded they “took no discernible steps” to challenge the assessments until February 7, 2018 – shortly before the March 1 filing deadline – and at that point made the decision to engage counsel who they knew would be unavailable until February 26, 2018. Among other points, the BTLA noted that the Taxpayer’s counsel signed and certified the abatement applications without consulting “anyone, including the Taxpayers,” and that there was “no evidence” that the Taxpayers reviewed the abatement applications prior to filing. Consequently, the BTLA held that based on “a review of the entire record and the relevant timeline that neither the Taxpayers nor their agent… made any attempt to comply with the taxpayer signature and certification requirements at all, in a timely manner.”
On appeal to the Supreme Court, the Taxpayers first argued that the BTLA was compelled to find that they exercised “ordinary business care and prudence,” arguing, among other points, that “most of them live out of state, the tax bills were received right before ‘the Holiday season,’ and they did not know that they were required to sign the abatement applications personally.”
The Supreme Court rejected this argument, noting that it failed to demonstrate, by a clear preponderance of the evidence, that the BTLA’s decision was unjust or unreasonable. Notably, the Taxpayers did not challenge the BTLA’s finding that they could have signed the abatement applications by fax or email, nor did they challenge the BTLA’s determination that neither the Taxpayers nor their counsel attempted to comply with the BTLA’s signature requirements. Furthermore, the Court stated that both Taxpayers and their counsel are presumed to know the law and their lack of actual knowledge did not excuse their failure to comply with the relevant rule. Accordingly, the Court upheld the BTLA’s determination that the Taxpayers failed to prove that the omission of their signatures and certifications was due to “reasonable cause and not willful neglect.”
The Court similarly rejected the Taxpayers’ suggestion that the BTLA exceeded its authority by adopting Rule 203.02(d), requiring the taxpayer to personally sign the property tax abatement application. Citing the Appeal of Wilson, 161 N.H. 659 (2011), the Supreme Court noted that had the legislature intended to allow a taxpayer’s agent to sign on their behalf, then they could have so stated. Given the plain language of the BTLA Rules and the statute, however, the Court rejected the Taxpayers’ suggestion that because their agent was an attorney (unlike the agent in Appeal of Wilson, who was a non-attorney) that the application could be considered. The Court found that the BTLA’s rule was consistent with RSA 76:16, both of which require the taxpayer – not their agent – to sign the application.
Taken together, while the Supreme Court’s decisions in the Appeal of Keith R. Mader 2000 Revocable Trust, et al. cases illustrate that while a taxpayer can seek to show reasonable cause to excuse the failure to sign a local abatement application, the bar will be set high to do so. These decisions highlight the importance of adhering to the procedural requirements of New Hampshire’s tax abatement scheme to allow appeals to be fully adjudicated on the merits.
Trevor J. Brown, Derek D. Lick and Margaret H. Nelson are attorneys with Sulloway & Hollis in Concord, practicing in the Firm’s State Taxation Group.