The opinion of the court was delivered by: Hamill
This is a motion by defendant, Director, Division of Taxation, to dismiss a state tax complaint for untimely filing.
On the return date of the motion, I ruled from the bench that, for the tax years at issue, the time for filing a state tax complaint commences to run on the date the Division of Taxation mails its notice to the taxpayer, not on the date shown on the Division's letter. I then gave the Director a period of time in which to advise whether he wished to pursue a proof of mailing hearing. The Director subsequently advised that he would not submit proof of mailing. Instead, the Director filed a letter brief arguing as a matter of law that the period for filing a complaint commences on the date of the Director's action, (in this case the date of the Director's letter) rather than on the date of mailing.
In view of the Director's determination not to pursue a proof of mailing hearing, I am denying the Director's motion to dismiss the complaint for untimely filing. As I stated on the record, without proof as to when the Division of Taxation's notice denying plaintiff's refund claim was mailed, the Director has not established that plaintiff's complaint was filed beyond the 90 days allowed by N.J.S.A. 54:51A-14 plus three days for mailing as allowed by R. 1:3-3.
To briefly summarize the pertinent facts, the Director issued a letter on January 22, 1993 denying plaintiff's claim for refund of corporation business tax. Plaintiff's complaint challenging the refund denial was stamped received by the Tax Court clerk's office on April 27, 1993, 95 days after the date on the Director's letter. As the ninety-third day following January 22 was Sunday April 25, the statute of limitations (including three days for mailing) expired on Monday April 26 assuming that the 90 days began to run on the date of the Director's letter. Thus, according to the Director, the complaint was filed one day late.
Plaintiff argues, and I agree, that, under the statute then in force and the pertinent court rules, the 90-day period did not commence to run on the date of the Director's letter but rather on the date the letter was mailed.
Although the applicable statutes and regulation, in particular N.J.S.A. 54:51A-14, N.J.S.A. 54:10A-19.2, and N.J.A.C. 18:1-1.8(a), all suggest that the 90-day period commences to run on the date of the Director's action, N.J.S.A. 54:10A-19.2 makes clear that an appeal to the Tax Court is to be taken in accordance with the State Tax Uniform Procedure Law. That law, in particular N.J.S.A. 54:51A-18, provides in pertinent part that, "service and all other matters with respect to the complaint ... shall be as prescribed by rules of court." The rules of court, specifically R. 8:4-2(a), provide that, "the time period [for filing a complaint] shall be calculated from the date of service of the decision or notice of the action taken." In Holmdel Tp. v. Director, Division of Taxation, 12 L. Ed. 2d 112, 115-17 (App. Div. 1991), aff'd o.b., 130 N.J. 522 (1992), the Appellate Division concluded that in calculating the 90-day statute of limitations prescribed by N.J.S.A. 54:51A-14, three extra days for mailing should be allowed pursuant to R. 1:3-3 because N.J.S.A. 54:51A-18 mandates application of the court rules to service of the complaint. If R. 1:3-3 applies in calculating the 90-day statute of limitations, so too does R. 8:4-2(a).
Under R. 1:5-4(b) service is complete on mailing. The common law rule is to the same effect. See Borgia v. Board of Review, 21 N.J. Super. 462, 467 (App. Div. 1952) ("'service of process by mail, when authorized, is deemed complete when the writ is deposited in the post office, properly addressed and with the proper amount of postage,'" (quoting 42 Am. Jur., "Process," § 60, p.48)). See also Amodio v. Civil Service Comm'n, 81 N.J. Super. 22, 27 (App. Div. 1963); 62B Am. Jur. 2d., "Process," § 228, p. 926.
The evidence does not establish that the Director's letter was mailed on the same day it was dated, viz. January 22, 1993. If mailed on the next business day, which was January 25, the ninety-third day would have been April 28, and plaintiff's complaint, received by the clerk on April 27, would have been timely. As the Director has not proved that his letter was mailed on January 22, he has not established that the complaint was filed beyond the 90-day statute of limitations augmented by three extra days for mailing.
In his post-argument letter brief, the Director takes the position that the time to appeal to the Tax Court in a state tax case runs from the date of the action to be reviewed, not from service of the Director's action.
The Director argues that R. 8:4-1 pertaining to the time for filing a complaint is divided into two subsections, subsection (a) pertaining to local property tax appeals and subsection (b) pertaining to state tax appeals. According to the Director, subsection (a) is clear that the time for appealing a judgment of a county board of taxation in a local property tax matter runs from the date the judgment is mailed. On the other hand, according to the Director, subsection (b) pertaining to state tax appeals is clear that the 90 days run from the "date of the action to be reviewed," and that date was the date of the Director's letter. The argument continues that this dichotomy between local property tax and state tax procedure is carried over to R. 8:4-2(a). Rule 8:4-2 pertains to the calculation of the time for filing a complaint, and subsection (a) of the rule states: "General. The time period shall be calculated from the date of service of the decision or notice of the action taken." According to the Director, "the date of service of the decision" starts the period for appealing a local property tax matter, while "notice of the action taken" starts the period for appealing a state tax matter.
If defendant were correct, the time to appeal in a state tax matter would run, not from the date of the Director's action but rather from the date when notice of the action was actually received because only at that point would a taxpayer have "notice of the action taken." It seems highly unlikely that the drafters of R. 8:4-2(a) intended that the 90-day appeal period for state tax matters should commence to run only when a taxpayer receives a determination letter from the Director because the date of receipt would be unknown to the Director and susceptible to manipulation.
There are two more plausible constructions of R. 8:4- 2(a). The first is that the rule is intended to cover two situations -- (1) service of the taxing authority's determination by mail, whether a county board judgment or a determination of the Director, and (2) actual notice of the taxing authority's action, e.g., hand delivery of a county board judgment or a determination of the Director. The difficulty with this first construction is that under the court rules, "service" may include both service by mail and personal service, R. 1:5-2, and personal service would provide actual notice, such that the phrase "notice of the action taken" would be redundant. Additionally, had the drafters of the rule intended that "service" and "notice" refer to two types of notification, they presumably would have inserted the word "of" before the word "notice" so that the sentence would have read, "The time period shall be calculated from the date of service of the decision or of notice of the action taken." Moreover, as plaintiff points out, N.J.S.A. 54:50-6 specifies that any notice required to be given by the Director pursuant to the State Tax Uniform Procedure Law "may be served personally or by mailing the same to the person for whom it is intended .... " (Emphasis added). As service under the court rules may be by mail or in person, the second and preferable construction of R. 8:4-2(a) is that the word "service" in the sentence "The time period shall be calculated from the date of service of the decision or notice of the action taken" modifies both "decision" and "notice." Such service may be personal or by mail. Under R. 1:5-4(b) service by mail, as was the case here, is complete on mailing.
In further support of his position that R. 8:4-2(a) differentiates the starting point for appealing a county board judgment and an action of the Director, defendant points to the rule's use of the word "decision" when the time is to be calculated from service and use of the word "action" when service is to be computed from notice of the action taken. Plaintiff responds, and I agree, that the terms "decision" and "action" are not limited to local property tax appeals in the case of "decisions" and state tax appeals in the case of "actions". Either term may apply to either type of tax as made clear by R. 8:2(a), which provides in part:
(a) General Jurisdiction. The Tax Court shall have initial review jurisdiction of all final decisions including any act, action, proceeding, ruling, decision, order or judgment including the promulgation of any rule or regulation of a County Board of Taxation, the Director of the Division of Taxation, any other state agency or officer (including the Director of the Division of Motor Vehicles) ...