ASH ASSOCIATES LLC v. JEFFERSON COUNTY BOARD OF EQUALIZATION (2022)

AFFIRMED. NO OPINION.

Ash Associates, LLC (“Ash”), appeals from an order of the Jefferson Circuit Court dismissing its appeal from the final decision of the Jefferson County Board of Equalization (“the Board”) denying Ash's challenge to the valuation of commercial property it owns in Jefferson County for the purpose of determining its ad valorem tax assessment. The circuit court dismissed the appeal on the basis that Ash had failed to comply with all the requirements for perfecting an appeal pursuant to § 40-3-25, Ala. Code 1975. That section provides, in pertinent part:

“All appeals from the rulings of the board of equalization fixing value of property shall be taken within 30 days after the final decision of said board fixing the assessed valuation as provided in this chapter [i.e., Ala. Code 1975, Title 40, Chapter 3]. The taxpayer shall file notice of said appeal with the secretary of the board of equalization and with the clerk of the circuit court and shall file bond to be filed with and approved by the clerk of the circuit court, conditioned to pay all costs, and the taxpayer or the state shall have the right to demand a trial by jury by filing a written demand therefor within 10 days after the appeal is taken. When an appeal is taken, the taxpayer shall pay the taxes due as fixed for assessment for the preceding tax year before the same becomes delinquent; and, upon failure to do so, the court upon motion ex mero motu must dismiss the appeal, unless at the time of taking the appeal the taxpayer has executed a supersedeas bond with sufficient sureties to be approved by the clerk of the circuit court in double the amount of taxes, payable to the State of Alabama, conditioned to pay all taxes, interest, and costs due the state, county, or any agency or subdivision thereof. Such appeals shall be preferred cases. ․”

(Emphasis added.)

The circuit court dismissed Ash's appeal because Ash failed to file a cost bond within 30 days after the Board's final decision. See Lumpkin v. State, 171 So. 3d 599, 601 (Ala. 2014) (“[A]ll the requirement[s] of § 40-3-25 had to be timely met in order to properly invoke the trial court's jurisdiction.”). Ash acknowledges this Court's holding in Lumpkin but invites this Court to revisit that holding. Today, this Court affirms, without an opinion, the circuit court's judgment dismissing Ash's appeal, finding it unnecessary to revisit Lumpkin. I respectfully dissent because I view the cost-bond requirement in § 40-3-25 as procedural rather than jurisdictional and, therefore, curable.

The cases holding that the filing of a cost bond is jurisdictional “perpetuate ‘a vestige from an earlier era of strict pleading and practice.’ ” Lumpkin, 171 So. 3d at 613 (Moore, C.J., dissenting) (quoting Luce v. Huddleston, 628 So. 2d 819, 820 (Ala. Civ. App. 1993)). The dissent in Lumpkin reasoned that the requirement that a taxpayer file a cost bond in order for a circuit court to acquire jurisdiction over the taxpayer's appeal was a holdover from before the 1975 adoption of the Alabama Rules of Appellate Procedure (“the ARAP”) and was contrary to the primary principle on which the ARAP are premised. Lumpkin, 171 So. 3d at 611; see also Rule 1, Ala. R. App. P. (“[The ARAP] shall be construed so as to assure the just, speedy, and inexpensive determination of every appellate proceeding on its merits.” (emphasis added)). The Committee Comments to Rule 7, Ala. R. App. P., pay tribute to that principle by stating that “the failure to file [security for costs on appeal] contemporaneously [with the notice of appeal] is not fatal to the jurisdiction of the appellate court.” Although the ARAP do not govern appeals brought pursuant to § 40-3-25, there is nothing in that statute that demonstrates the legislature's intent to depart from the principles on which the ARAP are premised.

The legislature has created bond requirements that are expressly jurisdictional. See § 40-2A-7(b)(5)c.1, Ala. Code 1975 (stating that the filing of a supersedeas bond and other requirements necessary for perfecting an appeal from a final tax assessment “are jurisdictional”). Given the legislature's proven capacity to expressly create jurisdictional requirements for perfecting an appeal, this Court should not needlessly infer that a statutory requirement -- like the cost-bond requirement in § 40-3-25 -- is jurisdictional to dismiss an appeal. Before the 1992 enactment of the Alabama Taxpayers’ Bill of Rights and Uniform Revenue Procedures Act, § 40-2A-1 et seq., Ala. Code 1975, the filing of a cost bond was required to perfect certain tax appeals to a circuit court: “If any taxpayer ․ is dissatisfied with the final assessment as fixed ․, he may appeal [to circuit court] ․ by filing notice of appeal with the secretary of the department of revenue and with the clerk or register of the circuit court ․ within 30 days from the date of said final assessment ․ and, in addition thereto, by giving bond ․ to be filed with and approved by the clerk or register of the court ․” Former § 40-2-22, Ala. Code 1975 (repealed effective October 1, 1992). Our appellate courts’ interpretation of this provision, holding that the “giving bond” requirement was jurisdictional, see, e.g., the cases cited in note 2, infra, conflicted with the Alabama Rules of Civil Procedure (“the ARCP”), which, like the ARAP, are premised on the principle that they should be “construed and administered to secure the just, speedy, and inexpensive determination of every action,” Rule 1(c), Ala. R. Civ. P., and the ARAP, which, as noted, provide that the failure to file a cost bond with a notice of appeal is not a jurisdictional defect, see Rule 7, Ala. R. App. P., and Committee Comments thereto.¹ Resolving this conflict and implicitly abrogating several cases,² the legislature removed the cost-bond requirement as to certain tax appeals by initially enacting former § 40-2A-9(g)(1), Ala. Code 1975, which has been repealed and replaced with § 40-2B-2(m).

For these reasons, I view the cost-bond requirement of § 40-3-25 and any interpretation that it is jurisdictional as antiquated. That provision was enacted before the creation of the Unified Judicial System and the adoption of the ARCP and the ARAP, and it has not been substantially changed since 1958. Based on the considerable changes that have occurred since then, both to the judicial system and in the law regarding appeals of tax assessments, it seems clear that any requirement to file a cost bond is merely procedural. Accordingly, I would reverse the judgment of the circuit court dismissing Ash's appeal and entertain Ash's request to revisit this Court's decision in Lumpkin.³

FOOTNOTES

1.   Traditionally, the legislature has provided administrative remedies that a taxpayer must pursue before seeking court review of a tax determination. Code sections like § 40-3-25 contained procedures for appealing such tax determinations to circuit court so that, when all administrative remedies had been exhausted, there was a set procedure for appeals to circuit court. But, with the creation of the Unified Judicial System and the adoption of the ARCP and the ARAP, a hybrid system evolved relating to appeals from tax determinations. Because a tax appeal was filed in circuit court, the ARCP applied, but there was some debate that the ARAP might also apply because the circuit court was acting much like an appellate court in reviewing the tax determinations of an administrative agency. Regrettably, the courts created an exception to Rule 2, Ala. R. Civ. P. Instead of there being “one form of action,” as described in Rule 2, courts carved out tax appeals, adding the requirement that filing a cost bond was a jurisdictional prerequisite for pursuing a tax appeal and making the failure to file a cost bond with the notice of appeal fatal to proceeding further in circuit court.

2.   See Frozen Yogurt Shop v. State, 595 So. 2d 893 (Ala. Civ. App. 1992); Baird v. State Dep't of Revenue, 545 So. 2d 804 (Ala. Civ. App. 1989); and Tuscaloosa Cnty. Special Tax Bd. v. Tuscaloosa Vending Co., 480 So. 2d 1223 (Ala. Civ. App. 1985).

3.   A property valuation for the assessment of ad valorem taxes is an annual, recurring event. Absent a significant change in value, the dispute of an assessment in one year would be similar to a dispute in a subsequent year. Dismissing this action flies in the face of judicial economy, because it only postpones a determination of value for another year. I am unsure what purpose this serves, because a taxpayer like Ash can always petition for a refund of taxes paid in prior years under § 40-10-160 et seq., Ala. Code 1975.

WISE, Justice.

Parker, C.J., and Shaw, Bryan, Mendheim, and Mitchell, JJ., concur. Sellers, J., dissents, with opinion, which Bolin, J., joins. Stewart, J., dissents.