Millard v. Dept. of Rev.

DECISION OF DISMISSAL TC-MD 250440R 1
IN THE OREGON TAX COURT
MAGISTRATE DIVISION
Income Tax
ADAM MILLARD, )
)
)
)
)
)
)
)
)
)
Plaintiff, TC-MD 250440R
v.
DEPARTMENT OF REVENUE,
State of Oregon,
DECISION OF DISMISSAL	Defendant.
Plaintiff appealed Defendant’s refusal to take corrective action after a 2023 personal
income tax refund was electronically deposited to a third-party bank account. The misdelivery
occurred because the bank information provided with Plaintiff’s return contained the incorrect
account number. Plaintiff seeks recovery of his refund and the court costs he incurred in small
claims matters he brought to recover the funds.
At a case management conference on October 16, 2025, the parties agreed to submit
briefing limited to the issue of whether this court has subject matter jurisdiction to grant the
requested relief. Plaintiff filed his motion for determination of subject matter jurisdiction on
November 17, 2025. Defendant filed its motion to dismiss for lack of subject matter jurisdiction
on December 11, 2025.
On December 20, 2025, Plaintiff submitted an ex parte request for additional time to
reply, asserting that Defendant captioned its submission on the subject matter jurisdiction issue
as a “Motion to Dismiss” rather than a “Response.” Because Tax Court Rule – Magistrate
Division (TCR-MD) 3 A prohibits a document from being filed and considered by the court “if a
certificate of service or other evidence of service is not included with [the] filing[,]” Plaintiff’s
motion is denied. The matter is ready for a decision.

DECISION OF DISMISSAL TC-MD 250440R 2
I. STATEMENT OF FACTS
The material facts of the case are not disputed. Plaintiff engaged Frome & Associates to
prepare and e-file his 2023 Oregon personal income tax return. (Comp at 1.) The return
reflected an overpayment of $2,582, and Plaintiff elected to receive his refund by direct deposit.
(Id.) Due to erroneous account/routing information on the tax return, the refund was deposited
into a Wells Fargo account belonging to someone other than Plaintiff. (Id. at 1-2.) Plaintiff
discovered the error, and Wells Fargo reportedly advised Plaintiff that funds were recoverable if
Defendant issued a recall notice. (Id. at 2) In response to Plaintiff’s request to issue a recall
notice, Defendant declined to do so, citing agency policy. (Id.)
Plaintiff pursued a small claims action in Los Angeles County, California, against Frome
& Associates resulting in a stipulated payment of fifty percent of the refund amount and the
preparer’s cooperation in seeking further recovery from Defendant. (Id. at 3.) Plaintiff then filed
a small claims action in Marion County, Oregon, (Case 25SC04694) seeking damages against
Defendant. (Ptf mot at 2.) Defendant moved to dismiss based on “lack of jurisdiction over the
subject matter[,]” stating the claim must be brough in the Oregon Tax Court. (Id. at 3; Ex 2.)
The small claims case was dismissed for lack of jurisdiction. (Compl at 3.)
II. ANALYSIS
The issues in this case are whether the court has subject matter jurisdiction over a refund
claim, and if so, whether Plaintiff has adequately stated ultimate facts sufficient to constitute a
claim for the court to adjudicate. In reviewing a motion to dismiss, the court must view all
allegations in a plaintiff's complaint as true. See Lourim v. Swensen, 328 Or 380, 383, 977 P2d
1157 (1999).

DECISION OF DISMISSAL TC-MD 250440R 3
A. Tax Court’s Statutory Jurisdiction
The Tax Court’s jurisdiction is purely statutory and limited to questions “arising under
the tax laws of this state.” ORS 305.410(1). The Oregon Supreme Court interpreted that statute
in Sanok v. Grimes, 294 Or 684, 662 P2d 693 (1983). The court in Sanok set out the challenge of
determining whether a claim is properly within the Tax Court’s subject matter jurisdiction as
follows:
“On the one hand, questions which must be resolved in order to decide taxability
or the amount of tax do arise under the tax laws. On the other hand, a precondition
to taxation does not arise under the tax laws if jurisdiction to decide that
precondition has been affirmatively located in another court or if a decision on the
precondition has substantial non-tax consequences.”
Id., at 697. The Supreme Court went on to conclude that the plaintiff’s tort claims were outside
the jurisdiction of the Tax Court, but his claim “for refund of excess taxes, [was] within the
express jurisdiction of the tax court.” Id. at 698-99, (citing ORS 305.440(2), 311.806(2)). The
Supreme Court summarized its holding as “a claim is not one ‘arising under the tax laws’ unless
it has some bearing on tax liability.” Id. at 701.
As this court has subsequently noted, there have been many instances where the court has
considered claims brought under the personal income tax refund statute,1 ORS 314.415, as a tax
law of this state, “including [cases] where the tax liability was not at issue.” Smith v. Dept. of
Rev., TC-MD 160196N, 2017 WL 728738 at *4 (Or Tax M Div, Feb 24, 2017). Aside from
circumstances where the taxpayer’s claim centers on Defendant’s downstream exercise of its
1 The court in Smith helpfully referenced a slew of cases where the Regular Division of the court
considered claims brought under ORS 314.415. See Day v. Dept. of Rev., 20 OTR 220 (2010) and Vieceli v. Dept. of
Rev., 20 OTR 212 (2010) (“each considering whether the taxpayers’ refund claim was timely under ORS
314.415(2)”); Lucas v. Dept. of Rev., 17 OTR 9 (2003) (“considering whether the defendant erred in applying
refunds to deficiencies under ORS 314.415(1)”). The court in Smith further noted that in at least one instance, the
Oregon Supreme Court reviewed such a case. See generally DeArmand v. Dept. of Rev., 328 Or 60, 968 P2d 1280
(1998).

DECISION OF DISMISSAL TC-MD 250440R 4
common-law authority of a creditor, “[t]axability and a bearing on tax liability are equally
relevant in “actions to collect tax amounts due, which arise after a tax liability is determined.”
Hefflinger v. Dept. of Rev., TC 5466, 2025 WL 2886054 at *9 (2025) (quoting Perkins v. Dept.
of Rev., 22 OTR 370, 374-75 (2017) (emphasis in the original)).
Plaintiff’s claim in the present case concerns Defendant’s payment handling after the
refund amount was determined—specifically, the refusal to recall a misdirected direct deposit.
This court has held that where the department has applied one taxpayer’s unadjusted refund to
the liability of another, that act is adverse to the taxpayer and affects their property, aggrieving
the taxpayer for the purpose of ORS 305.275(1)(a). Fackler v. Dept. of Rev., 18 OTR 67, 73
(2004). Further, that scenario arises under the tax laws of this state pursuant to ORS 305.410(1).
Smith, 2017 WL 728738 at *4. It is therefore enough that Plaintiff’s Complaint alleges that
Defendant mishandled his refund and no dispute exists that the refund was not the subject of a
collection action for the court to have subject matter jurisdiction over this case.
B. Direct-Deposit Statute Does Not Create a Recall Remedy
With the question of court’s jurisdiction resolved, the court turns to the substance of
Plaintiff’s claim. At base, Plaintiff alleges that Defendant had an obligation to recall the direct
deposit of Plaintiff’s refund resulting from an error in the bank account information
accompanying his return filing. ORS 305.762(1) indeed permits taxpayers to elect direct deposit
of personal income tax refunds “into an account designated by the taxpayer.” However, contrary
to Plaintiff’s reading, no provision in ORS 305.762 imposes an obligation on Defendant to recall
funds or create a recall remedy in the event of misdirection (nor is such a duty known by this
court to exist elsewhere in Oregon law). Oregon law does, however, contain clear directions on
how statues are to be interpreted. See generally ORS Chapter 174. A foundational principle in

DECISION OF DISMISSAL TC-MD 250440R 5
this interpretative methodology is that the role of the court “is simply to ascertain and declare
what is, in terms or in substance, contained therein, not to insert what has been omitted, or to
omit what has been inserted[.]” ORS 174.010. In observance of this statutory restriction, the
court lacks the authority to add the remedy envisioned by Plaintiff’s reading of ORS 305.762. In
the absence of such a provision’s existence, Plaintiff is unable to allege ultimate facts sufficient
to constitute a claim. Tax Court Rule 21 A(8). To the extent that Plaintiff’s other articulations
of this claim sound in tort law, those articulations are unambiguously beyond the jurisdiction of
this court. Sanok, 294 Or at 698-99.
C. The Constitutional “Remedy Clause” Does Not Expand Jurisdiction
As an alternative argument, Plaintiff invokes Article I, section 10 of the Oregon
Constitution (otherwise known as the “Remedy Clause”), contending that dismissal in circuit
court requires this court to provide a remedy. The Remedy Clause does not create a damages
action against the State of Oregon or expand the Tax Court’s jurisdiction. The Oregon Supreme
Court has emphasized that legislative remedial schemes—including the Oregon Tort Claims Act
(OTCA)—satisfy the Remedy Clause without creating new causes of action. See Horton v.
OHSU, 359 Or 168, 190–250, 376 P3d 998 (2016) (concluding Article I, section 10 does not
guarantee a remedy, only that courts be accessible “for such remedies as the law may provide.”).
Plaintiff’s reliance on Article I, section 10 is therefore misplaced and does not create a viable
cause of action that would allow Plaintiff’s case to proceed in this court.
D. Estoppel and Prior Litigation
Plaintiff also argues that Defendant should be estopped from asserting lack of Tax Court
jurisdiction because it previously argued in small claims that jurisdiction was proper here. This
court understands how Plaintiff feels wronged by the sequence of events in the small claims

DECISION OF DISMISSAL TC-MD 250440R 6
court. However, this court’s inquiry is limited to determining whether the claims alleged fall
within the statutory jurisdiction conferred on this court by the legislature, and its jurisdiction
cannot be expanded by party conduct or equitable doctrines. See ORS 305.410(1); Sanok, 294
Or at 697–701.
III. CONCLUSION
The court concludes that Plaintiff’s claim for relief attributable to ORS 305.762 is not a
viable basis to support the relief he seeks, nor is his reliance on Article I, section 10 of the
Oregon Constitution. As such, dismissal is required. Now, therefore,
IT IS THE DECISION OF THIS COURT that Plaintiff’s appeal is dismissed for failure
to state a claim upon which relief may be granted.
To appeal this Decision, file a complaint in the Regular Division of the Oregon
Tax Court. Appeals are accepted by electronic filing; by mail at 1163 State
Street, Salem, OR 97301-2563; and by hand delivery to 1241 State Street, Salem,
OR, Floor 4R.
Your complaint must be submitted within 60 days after the date of this Decision
or this Decision cannot be changed. TCR-MD 19 B.
This document was signed by Magistrate Richard Davis and entered on May 18,
2026.