Tax Court Emphasizes Need to Follow Timing Rules in Bringing Chapter 91 MotionsDecember 3, 2015

A recent New Jersey Tax Court opinion again establishes that the Court is continuing to scrutinize attempts by municipalities to dismiss taxpayer’s complaints for failure to comply with an assessor’s request for financial information pursuant to N.J.S.A. 54:4-34, otherwise known as Chapter 91. The Chapter 91 statute requires that owners of income producing properties served with such a request are to respond within 45 days or risk dismissal of a tax appeal filed in the subsequent tax year. Given this severe sanction, municipalities have long utilized this statute to dismiss otherwise meritorious property tax appeals.

Our firm recently defeated such an attempt. Judge Nugent’s opinion in Villager Realty Associates v. Irvington Township emphasized the need for municipalities to strictly follow the guidelines set forth in the statute as well as the Court Rules. Here, we argued that the motion was filed too late, as the Court Rules required any Chapter 91 motion to be filed within 180 days following the filing of the complaint. In this case the motion was filed 184 days following the filing of the complaint, thus taxpayer’s argument was that the clear language of the rules must be followed and the motion denied on this basis. The municipality argued that the 180 day time limit should be counted from the date of service, rather than the date of filing. Under such a scheme, the motion would be considered timely.

Judge Nugent agreed with taxpayer’s position that there was no basis in law to support Irvington’s position and denied the motion. The Court emphasized the need for strict adherence to the statutory timelines and refused to relax the rule for the municipality here, even though they were merely four days late in filing the motion. This harkens back to the decision our firm obtained in another Chapter 91 motion last year, this time before Judge Andresini. In 440 Rt 17 Ptrns, LLC v. Hasbrouck Heights we successfully argued against dismissal by asserting that our client’s failure to respond to the Chapter 91 request was excused by the failure of the municipality to issue the request 45 days before the January 10 deadline to submit its assessment list. In a case of first impression, Judge Andresini agreed with our position that this deficiency on the part of the municipality remains even where a municipality is granted an informal extension of this deadline beyond January 10th.

Thus while a Chapter 91 Motion often results in the loss of a taxpayer’s ability to appeal, it does appear via these recent opinions that the Tax Court will not grant such a motion without clear adherence to the letter of the statute and rules. It remains vital that timely response to Chapter 91 demands be provided to the tax assessor and that any Chapter 91 motion is inspected closely to determine whether or not the municipality has strictly adhered to statutory requirements.

Related Practices: Real Estate and Real Estate Tax Appeals

Attorney: Daniel Pollak

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