IN RE: UNITED REALTY FIVE (2026)

DECISION & ORDER

In a proceeding pursuant to CPLR article 78 to review a determination of the New York City Department of Finance dated April 7, 2023, which denied the petitioner's application for tax reassessment and reclassification of certain real property, the appeal is from a judgment of the Supreme Court, Queens County (Kevin J. Kerrigan, J.), entered January 2, 2024.  The judgment, inter alia, granted the petition, annulled the determination, and directed that the subject property be reassessed and reclassified as tax class one.

ORDERED that the judgment is affirmed, with costs.

In November 2022, the petitioner (hereinafter the taxpayer) submitted an application to the New York City Department of Finance (hereinafter the DOF) for tax reassessment and reclassification of a vacant lot located in Queens (hereinafter the parcel) from tax class four to tax class one for, inter alia, fiscal years 2018, 2019, 2020, 2021, 2022, and 2023.  By determination dated April 7, 2023, the DOF denied the application.  Thereafter, the taxpayer commenced this CPLR article 78 proceeding against Preston Niblack, the Commissioner of the DOF, and the City of New York (hereinafter together the appellants) to annul the determination.  By judgment entered January 2, 2024, the Supreme Court, among other things, granted the petition, annulled the determination, and directed that the parcel be reassessed and reclassified as tax class one.  This appeal ensued.

Administrative Code of the City of New York § 11–206 provides that “[t]he commissioner of finance may correct any assessment or tax which is erroneous due to a clerical error or to an error of description contained in the several books of annual record of assessed valuations, or in the assessments-rolls.”  Pursuant to the Rules of the City of New York Department of Finance in effect at the time of the subject determination (see 19 RCNY former §§ 53–01, 53–02 [hereinafter together the clerical error rules] ), an “[i]naccurate building class that affected assessed value” constitutes a clerical error or error of description (id. former § 53–02[b][10] ).  The clerical error rules provide that such errors of description may be corrected by application to the City within six years of the error (see id. former §§ 53–01, 53–02).  Contrary to the appellants' contention, the Supreme Court did not err by reaching the merits of the petition in this CPLR article 78 proceeding (see Matter of 232 Smith St., LLC v Soliman, 235 AD3d 967, 968;  Matter of Better World Real Estate Group v New York City Dept. of Fin., 122 AD3d 27, 33).

“Judicial review of an administrative determination not made after a quasi-judicial hearing is limited to whether the determination was made in violation of lawful procedure, was affected by an error of law, or was arbitrary and capricious or an abuse of discretion” (Matter of 232 Smith St., LLC v. Soliman, 235 AD3d at 968 [internal quotation marks omitted];  see CPLR 7803).  In the City, tax class one property includes “all vacant land located within a special assessing unit which is a city” that is either zoned residential or situated immediately adjacent to qualifying residential property, “other than such land in the borough of Manhattan” (RPTL 1802[1][d];  see 1801[a];  Matter of Emmons Realty, LLC v. Soliman, 247 AD3d 891).  Tax class four property consists of “all other real property which is not designated as class one, class two, or class three” (RPTL 1802[1] ).  Accordingly, vacant land that is zoned residential and located within the City but outside of the borough of Manhattan is properly classified as tax class one, regardless of a commercial overlay (see Matter of Wavebrook Assoc. v Niblack, 243 AD3d 669, 671;  Matter of 232 Smith St., LLC v. Soliman, 235 AD3d at 968).

Here, the parcel was a vacant lot located in Queens and was zoned R6 residential.  The appellants should have classified the parcel as tax class one regardless of any commercial overlay, and their failure to do so was an error of law (see RPTL 1802[1];  Matter of 232 Smith St., LLC v. Soliman, 235 AD3d at 968;  Matter of Shore Dev. Partners v Board of Assessors, 82 AD3d 988, 990).

Accordingly, the Supreme Court properly, inter alia, granted the petition, annulled the determination, and directed that the parcel be reassessed and reclassified as tax class one.

IANNACCI, J.P., BRATHWAITE NELSON, LANDICINO and GOLDBERG VELAZQUEZ, JJ., concur.