October 15, 2010
BARBARA J. HERTZ, PLAINTIFF-APPELLANT,
LINCOLN PARK BOROUGH, DEFENDANT-RESPONDENT.
On appeal from the New Jersey Tax Court, Docket No. 010866-2007.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued September 21, 2010
Before Judges Carchman, Graves and Waugh.
In these consolidated appeals, plaintiff Barbara Hertz appeals from a June 5, 2009 corrected judgment of the Tax Court ordering that defendant Borough of Lincoln Park refund rollback taxes for the years 2007, 2006 and 2005. In addition, in a fee dispute with her attorney, Steven R. Irwin, by leave granted, plaintiff appeals from an order of the Tax Court ordering Irwin to pay plaintiff the undisputed portion of the refund and hold the remaining funds in escrow pending resolution of the fee dispute. Finally, plaintiff appeals from an order of the Tax Court requiring plaintiff to "file for fee arbitration within 30 days of the date of this order or [plaintiff] will be deemed to have waived any right to seek arbitration."
We conclude that plaintiff's appeal from the June 2009 corrected judgment of the Tax Court is without merit, and we affirm the judgment of the Tax Court. In regard to the issue of the fee dispute, at oral argument, plaintiff represented that she had filed for arbitration pursuant to Rule 1:20A-3. Irwin acknowledged that filing. He stipulated that he would waive any procedural defenses as to the timeliness of such filing and would agree to have the New Jersey District Fee Arbitration Committee for Essex County, District V-B (the Committee) resolve the merits of the fee dispute. Accordingly, we remand the matter to the Committee and dismiss the appeals addressing the fee issue.
We briefly set forth the relevant facts related to the issues remaining in dispute. Although the appeal of the fee issue is now moot by the parties agreement, we relate relevant facts regarding that dispute as it may bear on the hearing before the Committee.
Plaintiff owns a 15.45 acre parcel of land located primarily in Lincoln Park, a portion of which extends into Montville Township. The land has been dedicated to horticultural use, and the land was taxed as farmland in 2005, 2006 and 2007. In 2007, the Lincoln Park Tax Assessor denied plaintiff's application for farmland assessment and pursuant to N.J.S.A. 54:4-23.8, levied rollback taxes on the land for the three years prior. Plaintiff unsuccessfully challenged this decision in the Morris County Board of Taxation. She then filed a complaint in the Tax Court appealing the decision of the Board of Taxation.
During the pendency of that appeal, plaintiff executed a contingent fee agreement with Irwin for representation in the Tax Court. This agreement provided that "counsel fee will be thirty (30.00%) [sic] of any realized tax savings gained at the Tax Court." It further specified that "[t]his fee agreement applies to the 2007 rollback (2006 and 2005) only, and does not apply to further or additional tax appeal work, such as... appeal to the Appellate Division, which will require another specific agreement." Finally, it was agreed that if "the counselor's work requirement is fewer than 40 hours, the payment will be compensated at the customary hourly rate for the actual hours of work."
At the trial in the Tax Court, plaintiff prevailed but the judgment only included a reference to the 2007 tax refund, which totaled $14,618.88, and a check was issued in that amount payable to Irwin and appellant. Defendant appealed but then withdrew the appeal.
Since the rollback affected 2006 and 2005, Irwin sent a letter to Judge Kuskin, the trial judge, noting that the judgment incorrectly omitted the 2005 and 2006 tax years. Then, plaintiff, pro se, moved for and obtained an order from us directing the Tax Court to correct the mistake on May 26, 2009. A corrected judgment was issued on June 5, 2009, and a check for the corrected amount of $51,197.90 was issued, payable to Irwin and plaintiff.
At this point, a dispute developed between Irwin and plaintiff. Irwin claimed that his thirty-percent contingency fee would be applied against the corrected total refund amount representing all three years. Plaintiff disagreed. Following a hearing before Judge Bianco*fn1 on August 28, 2009 regarding the refund, plaintiff was directed to endorse the check, but did so with the words "under protest."
The result of the hearing was a September 2, 2009 order directing that a new check be issued solely to Irwin.*fn2 The order also directed Irwin to deposit the check and return the undisputed portion of the refund (totaling $38,646.22) to plaintiff. Both plaintiff and Irwin agree that this amount was properly paid to plaintiff. This amount was computed by applying a thirty-percent contingency fee to the three-year refund ($41,838.93), but not against the interest and penalty paid by the borough ($9,358.97). Plaintiff does not challenge Irwin's right to a fee for the 2007 refund.*fn3 The fee dispute involves Irwin's claim for thirty-percent of the 2005 and 2006 refund. The order noted that "[i]f a proceeding takes place to contest the amount of the legal fee... nothing in this Order... shall constitute a finding of the amount of money due to [Irwin]." In addition, the order provided notice to plaintiff of her right to seek arbitration and allowed her thirty days to initiate arbitration. If plaintiff failed to file for arbitration, Irwin would be entitled to withdraw the total fees in dispute.
Irwin received the new check, returned the undisputed portion of the refund to plaintiff and moved before the Tax Court for his fees. The judge stayed the matter of the turnover pending this appeal. The order also indicated that plaintiff must "file for fee arbitration within 30 days of the date of this order or will be deemed to have waived any right to seek for arbitration."
These appeals followed.
As we noted at the outset, at oral argument, the parties agreed that the fee dispute should be resolved at the Committee and to facilitate the hearing, Irwin agreed that he would waive any defenses as to timeliness of the filing of plaintiff's fee dispute before the Committee. In that portion of her brief related to the fee dispute, plaintiff raises a number of issues related to her relationship with Irwin, his representation and conduct related to the case. Specifically, she asserts:
ARGUMENT POINT III
DID MR. IRWIN VIOLATE THE RPC 1.3, RPC 1.5 DUTY OWED TO THE CLIENT/FORMER CLIENT?
A. DID COUNSELOR IRWIN VIOLATE DUE DILIGENCE WHEN HE CAUSED THE CASE TO BE NEEDLESSLY PROTRACTED?
B. DID COUNSELOR IRWIN VIOLATE DUTY TO CARE WHEN HE RETAINS DOCUMENTS AND FAILS TO ABIDE BY THE TERMS OF THE RETAINER AGREEMENT?
C. WERE MR. IRWIN'S ACTIONS OF WITHHOLDING MISDIRECTED PAPERS INDICATIVE OF A PATTERN OF NEGLIGENCE AND FAILING THE DUTY TOWARDS THE FORMER CLIENT AS VIOLATION OF RPC 1.3?
D. WERE MR. IRWIN'S CONTINUING COMMUNICATIONS IMPROPER - MISREPRESENTING HIMSELF AS COUNSELOR?
E. DID MR. IRWIN IMPROPERLY INFLATE HIS FEE AWARD BEYOND THE 2007 TAX COURT APPEAL?
F. DID MR. IRWIN MISREPRESENT TO HONORABLE JUDGE VITO I. BIANCO, J.T.C. THAT STATUTORY NOTICE HAD BEEN SATISFIED?
ARGUMENT POINT IV
THE CASE AS FILED MUST BE THE BASIS OF A FEE AGREEMENT.
A. WHAT COMPRISED THE CONTINGENCY FEE?
B. ADHESION AND TERMS OF THE CONTRACT, AS REASONABLY SUPPORTED BY THE FILED APPEAL SHOULD BE APPLIED TO LIMIT CONTINGENCY TO THE 2007 TAX YEAR APPEAL.
In addition, plaintiff is critical of the motion judge's findings and determinations relative to the fee dispute. Any challenge to the judge's order regarding the timeliness of plaintiff's filing as well as the judge's findings is now moot as a result of the stipulation between the parties to resolve the fee issue before the Committee.
As to the issues raised in Points III A. to E., those issues will be addressed by the Committee in determining the bona fides of Irwin's claim. As to Point III F., regarding notice of arbitration, that issue is moot as the arbitration will be resolved before the committee. In reference to Point IV A. and B., the issues raised go to interpretation of the agreement and will be resolved in the arbitration. Accordingly, we dismiss the appeals in A-1919-09T2 and A-6288-08T2.
In reference to the first appeal (A-1924-09T2), the essence of plaintiff's argument is that Judge Kuskin failed to identify and resolve the issue of the location of the municipal boundary of Lincoln Park and Montville that "dissects" plaintiff's property. In addition, plaintiff asserts that Irwin failed to press the issue before the judge. As plaintiff notes in her brief, "The Tax Court could have resolve [sic] the question and directed locating the Municipal Boundary Line."
In her Case Information Statement filed in the Tax Court action, plaintiff first sets forth the relevant claim as to a "Farm Tax Assessment Rollback." She then describes in detail her purported dispute regarding the municipal boundary. We quote the relevant portion of her statement:
Apart from the improper Farm Tax Rollback Complaint, there are problems with the acreage, property conditions, municipal location designations and taxing method.
In 1922 (and 1925), the lawfully recorded metes and bounds description of the 1867 Montville Township Charter was adopted in the Lincoln Park Charter acknowledging the boundary by abbreviated terms: "along the various courses" in Montville. Engineer-Surveyor Arthur E. Hanson, Jr., P.E., L.S., P.P. (Hanson Engineering, Wayne, New Jersey) recently located the 1867 boundary, utilizing state of the art satellite imaging, radio telemetry etc. and shared those determinations with the planning boards on behalf of the Rosner Trust in that subdivision of Montville property. Assignment of municipal services to be provided by inter-municipal "agreement" does not change the municipal boundary location. (N.J.S.A. 40A:13-19.) From the time the plaintiff's property began to receive qualified farmland assessment, the tax assessor for both Lincoln Park and Montville (Tom Lenhardt) awarded the combined tax obligation to Lincoln Park. Without authorization, a tax assessor may not designate rights or obligation against another municipality.
"When the line between taxing districts divides a tract of land, each part shall be assessed in the taxing district where located, unless the governing body of one of the taxing districts shall by resolution request that the entire tract be assessed by the adjoining taxing district in which a portion of the tract is located." N.J.S.A. 54:4-25. (Emphasis added).
The decision to permit Lincoln Park to assess Montville property does not change the municipal boundary line. A portion of the farm (Glenview Rear, Block 31.1 lot 3), has "0" valuation, annotated "taxed in L(incoln) P(ark)." The tax obligation in Montville is assessed "0."
The Lincoln Park tax assessor may not assert Rollback taxes also against the Plaintiff's farmland in Montville. There was no Rollback Complaint filed by Montville against that land also continues in active horticultural use beyond Lincoln Park's boundary. [sic]
Without an agreement by mutual resolution, municipal boundary lines are not created by tax maps. Likewise, property tax obligations cannot be asserted from a line on a tax map. [See Courter v. Lincoln Park, 101 N.J. Eq. 572 (Ch. Ct. 1927), holding that even when the river was diverted (by placing logs and rock), the "re-located" property was not permitted to be assessed and taxed based on Lincoln Park's newly drafted map.]
Lincoln Park's only officially recorded tax map now on file with the New Jersey Department of the Treasury, Division of Taxation (dated October 2, 1972 Serial No. 513) annotates 11.86 acres of the plaintiff's property in Lincoln Park. If the 11.86 acres shown on that filed tax map represented the Charter boundary line, then only 11.86 acres could be taxed in Lincoln Park. However Mr. Hanson's survey appears to designate less than 3/4 of the Plaintiff's farm is located within Lincoln Park's boundary. (Lincoln Park's Rollback Complaint assesses 13.5 acres.)
Access by a 50 foot wide road from the public highway as designated on the above tax map, would cause the Plaintiff's property to be far more valuable than its mere "footpath" that may be enlarged to only a 14 foot wide "driveway." Therefore the assessed valuation in Lincoln Park is excessive.
From the time Lincoln Park began to incorporate in 1922, no statutory agreement established a mutually acceptable (shared) municipal boundary line with Montville, pursuant to N.J.S.A. 40A:13-22. Therefore, the Montville Township Charter (adopted by Lincoln park's Charter) continues to represent the limits of municipal authority. Statute N.J.S.A. 40A:13-16 designated the mutual municipal obligation to determine the boundary located. Whether it is agreed to adopt the Charter line offered by Engineer-Surveyor Arthur Hanson or to engage another surveyor, may be left to municipal discretion or the Court's declaration. (N.J.S.A. 40A:13-10.)
The entire controversy doctrine necessitates that the Charter line be enforced, to establish and restore appropriate municipal tax obligations and area services.
Therefore joinder of Montville Township is necessary for proper resolution of all issues.
Plaintiff's argument that Lincoln Park and Montville have no established boundary or recorded tax agreement is inapposite. N.J.S.A. 54:4-25 provides that "[w]hen the line between taxing districts divides a tract of land, each part shall be assessed in the taxing district where located, unless the governing body of one of the taxing districts shall by resolution request that the entire tract be assessed by the adjoining taxing district...." Plaintiff argues that no resolution exists between Lincoln Park and Montville. In her view, this gives Montville claim to tax the land located in their taxing district. However, even assuming that Montville had some claim to a portion of the tax obligation, plaintiff, as a third party, cannot vindicate those rights in a tax appeal addressing the issue of rollback taxes.
In addition, the Tax Court's jurisdiction is limited to "initial review jurisdiction of... a tax matter." R. 8:2(a).*fn4 A court may properly disregard a collateral argument if the judgment disposes of all material issues and claims. The rollback dispute before the Tax Court was settled in plaintiff's favor without any need to address plaintiff's alternative arguments.
We conclude that as to the issue of the rollback, the judge granted plaintiff appropriate relief and there was no necessity or mandate to decide the issue of the property line or the respective rights of the municipalities.
As to appeal A-1924-09T2, we affirm; as to appeals A-1919-09T2 and A-6288-08T2, in accordance with the agreement of the parties, we remand the fee issues to the fee dispute committee for resolution of the fee dispute. We do not retain jurisdiction.