On appeal from Tax Court of New Jersey.
Approved for Publication March 24, 1995.
Before Judges Brody, Long and A.m. Stein.
Pursuant to a judgment of the Tax Court, plaintiff, New York Life Insurance Company, was entitled to a refund of taxes paid to the Township of Lyndhurst. The refund was not paid until 153 days after the entry of judgment. This delay gave rise to the question of the period and rate at which interest on the belated refund would be imposed.
N.J.S.A. 54:3-27.2 provides:
In the event that a taxpayer is successful in an appeal from an assessment on real property, the respective taxing district shall refund any excess taxes paid, together with interest thereon from the date of payment at a rate of 5% per annum, less any amount of taxes, interest, or both, which may be applied against delinquencies pursuant to P.L. 1983, c. 137 (C. 54:4-134), within 60 days of the date of final judgment.
Plaintiff argued that the 5% interest rate applied only to the sixty-day period after judgment and that thereafter a greater than 5% rate could be imposed. Defendant urged a construction of the statute which would hold that the sixty-day period was a moratorium on the calculation of interest on refunds. Judge Small rejected both of these contentions and held that N.J.S.A. 54:3-27.2 is the sole source of authority for the imposition of interest in a tax refund case and that interest on a local property tax refund is to be paid from the date of payment to the date of refund at 5% per annum.
We affirm substantially for the reasons expressed by Judge Small in his opinion of February 4, 1994, the relevant details of which are set forth below:
R. 4:42-11(a) (emphasis added) provides that:
Except as otherwise ordered by the court or provided by law, judgments, awards and orders for the payment of money, taxed costs and counsel fees shall bear simple interest as follows: . . . .
Thus, by its own language, R. 4:42-11(a) does not apply to local property tax refunds because
(1) the law provides otherwise. N.J.S.A. 54:3-27.2 quoted in full above and
(2) judgments reducing tax assessments are not judgments for the payment of money - they are ...