Paul C. Bergman, Trustee of the Bergman Family Trust v. Board of Assessors of the Town of Wilmington (September 28, 2015)

COMMONWEALTH OF MASSACHUSETTS
APPELLATE TAX BOARD

PAUL C. BERGMAN, TRUSTEE OF     v.      BOARD OF ASSESSORS OF 
THE BERGMAN FAMILY TRUST 			THE TOWN OF WILMINGTON

Docket No. F322860					Promulgated: 						 					September 28, 2015

This is an appeal filed under the formal procedure pursuant to G.L. c. 58A, § 7 and G.L. c. 59, §§ 64 and 65 from the refusal of the Board of Assessors of the Town of Wilmington ("assessors" or "appellee"), to grant an application for property tax deferral relating to certain real estate located in Wilmington owned by Paul C. Bergman, trustee of the Bergman Family Trust ("appellant" and "Trust," respectively) for fiscal year 2014. 
	Chairman Hammond heard the appellee's Motion to Dismiss the appeal for lack of jurisdiction. Commissioners Scharaffa, Rose, Chmielinski and Good joined him in the decision for the appellee. These findings of fact and report are made pursuant to a request by the appellant under G.L. c. 58A, § 13 and 831 CMR 1.32.
Brian T. Corrigan, Esq. for the appellant.
John Richard Hucksam, Jr., Esq. for the appellee.

FINDINGS OF FACT AND REPORT
On the basis of testimony and exhibits offered into evidence at the hearing of the appellee's Motion to Dismiss, the Appellate Tax Board ("Board") made the following findings of fact. 
On January 1, 2013, the relevant assessment date for fiscal year 2014, the appellant was the owner of 21 Shady Lane Drive in Wilmington, a parcel of land improved with a single-family residence ("subject property"). The assessors valued the subject property at $310,700 for fiscal year 2014 and assessed a tax in the amount of $4,424.37. The appellant did not timely pay the tax and consequently incurred interest.  
The appellant has resided at the subject property since 1958 and his mother, Helen Bergman, resided there with him until 2010, when she moved into a nursing home. In 1995, Ms. Bergman conveyed the subject property by deed to the Trust, of which Ms. Bergman was the sole trustee and in which Ms. Bergman and the appellant held equal fifty percent beneficial interests. During June of 2010, Mrs. Bergman resigned as trustee of the Trust and appointed the appellant sole successor trustee. 
During March of 2012, the appellant, as trustee of the Trust, executed a Tax Deferral and Recovery Agreement with respect to the subject property under G.L. c. 59, § 5, Clause Forty-first A ("Clause Forty-first A"). Pursuant to the terms of Clause Forty-first A, the appellant filed an application for property tax deferral for fiscal year 2013, which the assessors granted. The assessors, however, denied the fiscal year 2014 application on February 14, 2014, having concluded that the appellant had not owned the subject property for five years as required by Clause Forty-first A. The appellant timely appealed the denial to the Board.  
Based on the preceding facts, and for the reasons stated in the following Opinion, the Board found and ruled that it did not have jurisdiction to hear and decide this appeal. Accordingly, the Board issued a decision for the appellee.

OPINION
The principal issue presented for consideration in this appeal is whether the Board has jurisdiction to hear and decide the appeal where there is no dispute that the appellant failed to pay his tax bill timely and incurred interest. 
Generally, a taxpayer aggrieved by assessors' refusal to abate a tax on real property may file an appeal with the Board, provided that:
[I]f the tax due for the full fiscal year on a parcel of real estate is more than $3,000, said tax shall not be abated unless the full amount of said tax due has been paid without the incurring of any interest charges on any part of said tax pursuant to section fifty-seven of chapter fifty-nine of the General Laws.  

G.L. c. 59, § 64 (emphasis added). The tax on the subject property exceeded the $3,000 threshold and, as noted, the tax due was not paid without incurring interest. Alternatively, a taxpayer may appeal to the Board if he has made a timely payment of tax which is at least equal to the average tax for the three preceding years. Assessors of New Braintree v. Pioneer Valley Academy, Inc., 355 Mass. 610, 617 (1969); see also G.L. c. 59, § 64. The appellant did not dispute that he failed to satisfy the three year average payment requirement.
	"The Board is a creature of statute and, therefore has no jurisdiction to entertain any proceeding for relief other than in a manner prescribed by statute." Pepperell Power Assoc. v. Assessors of Pepperell, Mass. ATB Findings of Fact and Reports 1996-503, 507.  "Adherence to the statutory prerequisites is essential 'to prosecution of appeal from refusals to abate taxes.'"  Id. (quoting New Bedford Gas & Edison Light Co. v. Assessors of Dartmouth, 368 Mass. 745, 747 (1975)). Given that the appellant failed to satisfy the statutory prerequisites to filing an appeal, the Board is deprived of jurisdiction to hear and decide his appeal. See also Columbia Pontiac Co. v. Assessors of Boston, 395 Mass. 1010, 1011 (1985); Fillipone v. Assessors of Newton, Mass. ATB Findings of Fact and Reports 1995-216.
Finally, even assuming for the sake of argument that the Board were to have had jurisdiction in the present appeal, the appellant would not have prevailed on the merits of the case. Specifically, the appellant became trustee of the Trust during June of 2010, prior to which he held only a beneficial interest in the subject property. Clause Forty-first A, in pertinent part, requires that a person seeking to defer taxes on real property "has so owned and occupied as his domicile such real property . . . for five years." Id.  There is ample precedent to support the conclusion that a mere beneficial interest in property will not satisfy ownership requirements for purposes of Clause Forty-first A. In Kirby v. Assessors of Medford, 350 Mass. 386 (1966), an individual unsuccessfully sought a property exemption under G.L. c. 59, § 5, Clause Forty-first, which affords tax benefits to individuals over 70 years of age and imposes domicile and ownership constraints similar to those of Clause Forty-first A.  The Supreme Judicial Court held that the taxpayer's beneficial ownership interest in the property at issue, which he had placed in a trust for which another individual served as trustee, did not satisfy the statute's five-year ownership requirement.  Id. at 391.  
In particular, the Court stated that Clause Forty-first mandated "not only ownership of a sufficient beneficial property interest, but also ownership of a record legal interest, as a condition of obtaining the exemption." Id.  
The Board also recently held that a veteran's exemption under G.L. c. 59, § 5 Clause Twenty-second had been properly denied where a veteran who otherwise qualified for the exemption failed to meet the exemption's ownership requirement because he held only a beneficial interest in the property for which the exemption was sought while his mother, as trustee, held legal title to the property. See Rheault v. Assessors of Oxford, Mass. ATB Findings of Fact and Reports 2014-245 247,248. In reaching its conclusion in Rheault, the Board relied, in large measure, on the holding in Kirby. Given the cited precedent and that the appellant held only a beneficial interest in the subject property until June of 2010, the Board was compelled to conclude that the appellant would not satisfy the five-year property ownership requirement provided by Clause Forty-first A.  




In sum, the Board found and ruled that it did not have jurisdiction to hear and decide the present appeal and regardless, the appellant would not have qualified for tax deferral under Clause Forty-first A.  Accordingly, the Board issued a decision for the appellee.
	
					       THE APPELLATE TAX BOARD


					   By: ________________________________			                      Thomas W. Hammond, Jr., Chairman

A true copy,

Attest: _________________________
	   Clerk of the Board

ATB 2015-543