On appeal from the Superior Court, Appellate Division, whose opinion is reported at 263 N.J. Super. 567 (1993).
Chief Justice Wilentz and Justices Clifford, Handler, and O'hern join in Justice STEIN's opinion. Justice Garibaldi has filed a separate Dissenting opinion in which Justice Pollock joins.
The opinion of the Court was delivered by
This appeal requires that we consider the scope of the Correction of Errors statute, N.J.S.A. 54:51A-7. The specific error in issue arises from the misplacing by the Howell Township tax assessor's office of the farmland-assessment application filed by Hovbilt, Inc. (Hovbilt), resulting in a higher property tax
assessment than would have been imposed if the property had been assessed as farmland.
The Tax Court, in an unreported opinion, held that the error was not correctable under the statute. A divided panel of the Appellate Division affirmed. 263 N.J. Super. 567 (1993). Hovbilt appeals to this Court as of right. See R. 2:2-1(a)(2).
The essential facts are not in dispute. Since 1984, Hovbilt has been the owner of a thirty-five-acre parcel of land in the Township of Howell, known as Block 142, lots 16 and 24. Hovbilt purchased the property in anticipation of "potential development use," but in recent years the land has been farmed for soybeans.
From each of the tax years 1985 through 1990, Hovbilt submitted an application to the Township to have the property assessed as land in agricultural or horticultural use, pursuant to the Farmland Assessment Act of 1964, N.J.S.A. 54:4-23.1 to -23.23 (the Act). The Township granted the application each year.
For the 1991 tax year, Hovbilt prepared and timely filed on July 10, 1990, the application for farmland assessment, form FA-1, with the tax assessor's office in Howell Township. See N.J.S.A. 54:4-23.6(c); N.J.A.C. 18-15-2.4. However, the tax assessor did not see, and therefore did not consider, the application. The form apparently was misplaced or mishandled. In June or July 1991, Hovbilt received its 1991 tax bill. The property was assessed at full value, in the amount of $556,300. The assessment resulted in annual taxes of $9,368. When the property had been assessed as farmland in 1990, the assessment was $16,100, and annual taxes were $695.04.
Hovbilt did not appeal its assessment to the Monmouth County Board of Taxation. See N.J.S.A. 54:3-21. On December 11, 1991, Hovbilt filed a complaint with the Tax Court, alleging a correctable error under the Correction of Errors statute, N.J.S.A.
54:51A-7. That statute provides in part that the Tax Court may "upon the filing of a complaint at any time during the tax year or within the next 3 tax years thereafter, . . . enter judgment to correct typographical errors, errors in transposing, and mistakes in tax assessments."
The Tax Court dismissed the complaint, noting that the case law interpreting the Correction of Errors statute has construed the statute restrictively. The court held that the error complained of was not a typographical error, an error in transposing, or a mistake in tax assessment, and therefore could not be corrected pursuant to the statute.
In affirming, the Appellate Division majority reviewed the history of the Correction of Errors statute, describing the statute as "contrary to the other provisions of Title 54 regarding tax matters which require strict adherence to time limitations." 263 N.J. Super. at 570. Perceiving the statute as an exception to the regular tax-appeal process, the majority was "convinced that the Statute must be strictly construed." Ibid. The majority noted the "more than two million assessments each year, suggesting to us the system will collapse unless a strict interpretation is accorded exceptions to the general tax appeal scheme." Id. at 571. The majority considered whether the failure of the tax assessor to consider the application for farmland exemption was a "mistake in tax assessment" as described in the Correction of Errors statute. The court applied the principle of ejusdem generis to limit "mistakes in tax assessments" to "embrace only mistakes that are similar to typographical errors and errors in transposing." Ibid. The majority held that the failure to consider the application was not similar to "typographical errors or errors in transposing, which are mechanical in nature." Ibid.
The Dissenting member rejected the majority's concern over a "cascade of cases" that would overwhelm the courts. Id. at 573. The Dissent concluded that the interpretation
offered by the majority serves to strike any meaning from the phrase "mistakes in tax assessments." Id. at 574.
A taxpayer or a taxing district aggrieved or discriminated against because of the assessed valuation of property may file a petition of appeal with the county board of taxation (county board). N.J.S.A. 54:3-21. The county board can compel the attendance of witnesses and the production of books and papers, and can examine witnesses under oath. N.J.S.A. 54:3-22(a). If satisfied by the proofs that the assessment was incorrect, the county board can revise the taxable value of the property. See N.J.S.A. 54:3-22(c)-(e) (providing methods of computation of taxable value of property). Any determination by the county board may be reviewed by the Tax Court. See N.J.S.A. 54:48-1 to 54:53-16; N.J.S.A. 54:3-26a.
"The right to appeal a real property assessment is statutory, and the appellant is required to comply with all applicable statutory requirements." F.M.C. Stores Co. v. Borough of Morris Plains, 195 N.J. Super. 373, 381, 479 A.2d 435 (App. Div. 1984), aff'd, 100 N.J. 418, 495 A.2d 1313 (1985). The petition of appeal must be filed with the county board before April 1 of the tax year at issue. N.J.S.A. 54:3-21. (L. 1991, c. 75, changed the date for filing petitions of appeal from August 15 to April 1, effective January 1, 1992.) Failure to file a timely appeal of a tax assessment is a fatal jurisdictional defect. F.M.C. Stores Co., supra, 195 N.J. Super. at 382-83. "Tax laws generally require that tax determinations be subject to review in a mandatory manner in strict conformity with statutory time limitations." Little Egg Harbor Township v. American Tel. & Tel. Co., 9 N.J. Tax 314, 323 (Tax 1987), aff'd o.b., 10 N.J. Tax 236 (App. Div. 1988). Without timely filing of the review petition, a county board, Danis v. Middlesex County Bd. of Taxation, 113 N.J. Super. 6, 10, 272 A.2d 542 (App. Div. 1971), or the Tax Court, Exxon Corp. v. East Brunswick Township, 5 N.J. Tax 216, 222-23 (Tax
1982), aff'd in part and rev'd in part on other grounds, 192 N.J. Super. 329 (1983), certif. denied, 96 N.J. 312 (1984), is without jurisdiction to grant the relief sought. See also H.G.K.W. Corp. v. East Brunswick Township, 8 N.J. Tax 454, 464 (Tax) ("Plaintiff's uncontroverted failure to file a petition of appeal with the county board within the statutory limitation period pursuant to N.J.S.A. 54:3-21 also forecloses plaintiff's right of appeal to the Tax Court."), aff'd o.b., 9 N.J. Tax 91 (App. Div. 1986).
The Correction of Errors statute is an exception to the standard tax-appeal process authorized by N.J.S.A. 54:3-21. The statute provides an extended period of relief after the deadline for appeal to the county board or to the Tax Court has passed. "The correction of certain types of assessor's errors requires a longer statute of limitations." Van Winkle v. Borough of Rutherford, 12 N.J. Tax 290, 293 (Tax 1992).
The Legislature first enacted the Correction of Errors statute in 1905. Section 5 of Chapter 67, P.L. 1905, allowed the State Board of Tax Appeals to correct errors at any time. The only requirement was consent of the mayor or assessor of the municipality affected. L. 1905, c. 67. In 1946, the Legislature amended the statute, L. 1946, c. 161, requiring that verifiable facts be set forth in the application to support the correction, but permitting the error to be corrected only if the majority of the governing body of the affected municipality gave its consent.
The Legislature amended the statute again in 1979. L. 1979, c. 44, § 1; L. 1979, c. 114, § 8. Those amendments incorporated a number of substantive requirements that remain in effect. The aggrieved party could no longer seek relief at any time, and the taxpayer had to file an application for relief during the tax year or within the ensuing three years. Consent was no longer required to authorize correction of an error. The statute also extended the right of appeal to municipalities and county boards, and conferred jurisdiction in the Tax Court with respect to suits instituted under the statute. L. 1979, c. 114, § 8. The statute was more specific
about the type of errors that could be corrected, limiting the statutory relief only to "typographical errors, errors in transposing, and mistakes in tax assessments." L. 1979, c. 44, § 1. Taxpayers could not challenge valuations that involved the opinion or judgment of the assessor. See L. 1979, c. 114, § 8; see also State Revenue, Finance and Appropriations Committee, Statement to Senate Bill No. 1103, at 1-2 (Sept. 18, 1978) (listing "several substantive changes made in [the correction-of-errors] procedure").
The legislative history indicates that the 1979 amendments were intended to limit the application of the Correction of Errors statute:
The changes in the process provided in this bill represent a more carefully defined and limited procedure consistent with the intent of the Legislature in originally establishing the process in law. The process was established to permit a timely correction of administrative errors, avoiding the need for a formal appeal to be processed. It is not intended that this process be used for settlement of challenges of an assessors [sic] opinion as to value of a parcel of real property or the assessment of property as real property.
[Senate Revenue, Finance and Appropriations Committee, Statement to Senate Bill No. 1103, at 2 (Sept. 18, 1978) (emphasis added).]
The Correction of Errors statute currently reads:
The tax court may, upon the filing of a complaint at any time during the tax year or within the next 3 tax years thereafter, by a property owner, a municipality or a county board of taxation, enter judgment to correct typographical errors, errors in transposing, and mistakes in tax assessments, provided that such complaint shall set forth the facts causing and constituting the error or errors and mistake or mistakes, or either thereof sought to be corrected and that such facts be verified by affidavits submitted by the plaintiff. The tax court shall not consider under this section any complaint relating to matters of valuation involving an assessor's opinion or judgment. Any complaint so submitted shall contain a certification that a copy of the complaint and all exhibits thereto have been filed with the county board, and served upon the property owner or the municipality, or both, as may be appropriate in the case of each plaintiff. Any party required to receive a copy of the complaint pursuant to this section may file an answer to the complaint with the tax court pursuant to rules of court. The tax court may require further proof and grant or deny the complaint as it may deem necessary or proper.
Most of the cases that have considered the Correction of Errors statute have construed it restrictively. In defining the "types of
assessor's errors requiring a longer statute of limitations," courts have sharply limited the meaning of the phrase "mistakes in tax assessments." Van Winkle, supra, 12 N.J. Tax at 293.
Our inquiry concerning the proper interpretation of the Correction of Errors statute gains perspective from a detailed examination of the cases that have considered various applications of the statute. The first case that considered the current formulation of the statute was Manczak v. Township of Dover, 2 N.J. Tax 529 (Tax 1981). In Manczak, the assessor, over a period of years, valued a residence based on the incorrect assumption that the dwelling contained a basement. The taxpayers never appealed from any of the erroneous assessments. They filed a complaint seeking relief under the statute, and the attorney for the municipality provided the court with a proposed order for correction by consent. The Tax Court denied relief, holding that the use of incorrect data by the assessor cannot be remedied pursuant to the Correction of Errors statute. The court noted that the alleged mistake involved the opinion or judgment of the assessor. Id. at 535. Because the Correction of Errors statute was a "deviation from this appeal procedure [N.J.S.A. 54:3-21], which is the method established by the Legislature for reviewing assessments, [it was] analogous to an exemption and must be strictly construed." Id. at 534. Applying the ejusdem ...