PETITIONER APPEARING PRO SE: ATTORNEYS FOR RESPONDENT:
BRADLEY J. WHETZEL STEVE CARTER
Lanesville, IN ATTORNEY GENERAL OF INDIANA
DEPUTY ATTORNEY GENERAL
INDIANA TAX COURT
BRADLEY J. WHETZEL, )
v. ) Cause No. 39T10-0008-SC-96
DEPARTMENT OF LOCAL )
See footnote )
ON APPEAL FROM A FINAL DETERMINATION
OF THE STATE BOARD OF TAX COMMISSIONERS
January 17, 2002
Bradley J. Whetzel appeals the State Board of Tax Commissioners (State Board) final
determination that it did not have the authority to hear or decide whether
Whetzel owed a penalty for the late payment of his property taxes for
the 1996 tax year. Whetzel presents the following issues for this Courts
review on appeal, which the Court restates as:
whether the State Board made a final determination as required for this Court
to have subject matter jurisdiction over Whetzels appeal; and
whether the State Board was statutorily empowered to determine whether the County properly
assessed Whetzel the ten percent penalty for the late payment of his property
For the reasons stated below, the Court finds for Whetzel on the first
issue and for the State Board on second issue.
FACTS AND PROCEDURAL HISTORY
In September 1995, Whetzel purchased property located in Harrison County, Indiana. In
September 1997, Whetzel received a notice of assessment. In March 1998, Whetzel
received a property tax bill for the 1996 tax year, which included a
late payment penalty of $110.06. Whetzel paid the tax and penalty but
filed a 133 Petition for Correction of an Error (133 Petition) disputing that
he owed the penalty. He claimed that he never had the opportunity
to pay this bill in a timely manner because the first bill that
he received for the tax included the penalty. The Harrison County Board
of Review issued its final determination affirming the imposition of the penalty.
Thereafter, Whetzel appealed his 133 Petition to the State Board. On June
6, 2000, the State Board issued its final determination that it did not
have the authority to hear and decide Whetzels appeal. On August 10,
2000, Whetzel filed his original tax appeal in this Court. On September
27, 2000, the State Board filed a motion to dismiss pursuant to Indiana
Trial Rules 12(B)(1) & (6). Additional facts will be provided as necessary.
ANALYSIS AND OPINION
Standard of Review
This Court gives final determinations of the State Board great deference when the
State Board acts within the scope of its authority. Freudenberg-NOK General Partnership
v. State Bd. of Tax Commrs, 715 N.E.2d 1026, 1028-29 (Ind. Tax Ct.
1999), review denied. Accordingly, this Court reverses final determinations of the State
Board only when they are unsupported by substantial evidence, are arbitrary or capricious,
constitute an abuse of discretion, or exceed statutory authority. Id. at 1029.
I. Subject Matter Jurisdiction
The first issue is whether the State Board made a final determination as
required for this Court to have subject matter jurisdiction over Whetzels appeal.
The State Board argued that this Court does not have subject matter jurisdiction
because the State Board did not have the statutory authority to decide the
issue raised in Whetzels case, and therefore, no final determination was ever issued.
Consequently, the State Board asked that this case be dismissed pursuant to
Indiana Trial Rule 12(B)(1).
Subject matter jurisdiction is the power of a court to hear and determine
the general class of cases to which the proceedings before it belong.
Musgrave v. State Bd. of Tax Commrs, 658 N.E.2d 135, 138 (Ind. Tax
Ct. 1995). Whether a court has subject matter jurisdiction depends on whether
the type of claim advanced by the petitioner falls within the general scope
of authority conferred upon the court by constitution or statute. Id.
Indiana Code Section 33-3-5-2(a) set forth the general scope of authority conferred upon
the Tax Court. Ind. Code § 33-3-5-2(a) (West 1996). This section
of the Indiana Code stated that the Tax Court is a court of
limited jurisdiction having exclusive jurisdiction over any case that arises under the tax
laws of [Indiana] and that is an initial appeal of a final determination
made by the State Board. I.C. § 33-3-5-2(a)(2); see also Scheub v.
State Bd. of Tax Commrs, 716 N.E.2d 638, 642 (Ind. Tax Ct. 1999).
A final determination is an order that determine[s] the rights of, or
impose[s] obligations on, the parties as a consummation of the administrative process.
Ispat Inland Inc. v. State Bd. of Tax Commrs, 757 N.E.2d 1078, 1083
(Ind. Tax Ct. 2001) (quoting Mills v. State Bd. of Tax Commrs, 639
N.E.2d 698, 701 (Ind. Tax Ct. 1994)).
The parties did not dispute that the case arises under the Indiana tax
laws. Therefore, the Court will look only to whether the State Board
issued a final determination in Whetzels case. The State Boards written decision
on Whetzels case was titled Final Determination. (R. of Administrative Proceedings at
10.) In that document and the attached findings of fact and conclusions
of law, the State Board found that it did not have the statutory
authority to decide whether Whetzel was properly assessed the late penalty
See footnote on his
property taxes. (R. of Administrative Proceedings at 10.) Because that decision
concluded that Whetzel did not have the right to have the penalty at
issue reviewed by the State Board, the State Boards decision was a final
See Ispat Inland Inc., 757 N.E.2d at 1083; I.C. § 33-3-5-2(a)(2).
The fact that the State Boards final determination did not decide the
substantive issue does not make it any less of a final determination regarding
its procedural authority to decide the case. See Infra Part II.
Consequently, this Court has subject matter jurisdiction to decide the narrow issue of
whether the State Board had the procedural authority to decide whether Whetzel owes
the penalty at issue.
See footnote Therefore, the State Boards motion to dismiss for
lack of subject matter jurisdiction is DENIED.
II. State Boards Statutory Authority
The next issue is whether the State Board was statutorily empowered to determine
whether the County properly assessed Whetzel the ten percent penalty for the late
payment of his property taxes. The State Board argued that it did
not have the statutory power to decide whether the penalty was properly imposed
on Whetzels property. Therefore, the State Board argued that this case should
be dismissed pursuant to Indiana Trial Rule 12(B)(6), for failure to state a
claim upon which relief can be granted. However, the Court will treat
this motion as a motion for summary judgment because the State Board filed
an exhibit at the oral argument on the motion to dismiss.See footnote (Oral Argument
Tr. at 5.) (Respt Ex. A.)
Summary judgment is only appropriate where no genuine issues of material fact exist
and the moving party is entitled to judgment as a matter of law.
Ind. Trial Rule 56(C);
Matonovich v. State Bd. of Tax Commrs, 705
N.E.2d 1093, 1096 (Ind. Tax Ct. 1999), review denied.; Snyder v. Indiana Dept
of State Revenue, 723 N.E.2d 487, 488 (Ind. Tax Ct. 2000), review denied.
The summary judgment procedure is designed to terminate cases in which there
can be no factual dispute and which may be decided as a matter
of law. Matonovich, 705 N.E.2d at 1096. Questions of statutory construction
are particularly amenable to resolution by summary judgment. Id.
The State Board was a creation of the Legislature and therefore only had
those powers conferred by statute. Matonovich, 705 N.E.2d at 1096; Hoogenboom-Nofziger v.
State Bd. of Tax Commrs, 715 N.E.2d 1018, 1021 (Ind. Tax Ct. 1999).
When construing a statute, it is equally as important to recognize what
the statute does not say as it is to recognize what it does
say. City of Evansville v. Zirkelbach, 662 N.E.2d 651, 654 (Ind. Ct.
App. 1996), trans. denied. Therefore, the State Board could only decide whether
Whetzel owed the penalty if it was statutorily empowered to do so.
The appeals division of the State Board was empowered to review appeals concerning
(1) the assessed valuation of tangible property;
(2) property tax deductions;
(3) property tax exemptions; or
(4) property tax credits;
that [were] made from a determination by an assessing official or a county
property tax assessment board of appeals to the state board of tax commissioners
under any law.
Ind. Code § 6-1.1-30-11(c) (West 2000). This statute granted power to the
State Board to review only appeals concerning matters enumerated therein. The statute
did not grant any power to the State Board to review penalties imposed
by the County for the late payment of property taxes.
See footnote Therefore, the
State Board did not have any authority to decide Whetzels appeal of the
penalty imposed for late payment of his property taxes. Consequently, this court
GRANTS the State Boards motion for summary judgment on this issue.
For the foregoing reasons, the Court hereby DENIES the State Boards motion to
dismiss for lack of subject matter jurisdiction because the State Board did make
a final determination. However, the Court GRANTS summary judgment in favor of
the State Board because the State Board did not have the authority to
decide whether the County properly assessed Whetzel with a penalty for late payment
of his property taxes.
Footnote: The State Board of Tax Commissioners (State Board) was originally the
Respondent in this appeal. However, the legislature abolished the State Board as
of December 31, 2001. P.L. 198-2001, § 119(b)(2). Effective January 1,
2002, the legislature created the Department of Local Government Finance (DLGF),
§ 6-1.1-30-1.1 (West Supp. 2001)(eff. 1-1-02); P.L. 198-2001, § 66, and the Indiana
Board of Tax Review (Indiana Board). Ind. Code § 6-1.5-1-3 (West Supp.
2001)(eff. 1-1-02); P.L. 198-2001, § 95. Pursuant to Indiana Code Section 6-1.5-5-8,
the DLGF is substituted for the State Board in appeals from final determinations
of the State Board that were issued before January 1, 2002. Ind.
Code § 6-1.5-5-8 (West Supp. 2001)(eff. 1-1-02); P.L. 198-2001, § 95. Moreover,
the law in effect prior to January 1, 2002 applies to these appeals.
Ind. Code § 6-1.5-5-8 (West Supp. 2001)(eff. 1-1-02); P.L. 198-2001, §§ 95,
117. Although the DLGF has been substituted as the Respondent, this Court
will still reference the State Board throughout this opinion.
Indiana Code Section 6-1.1-37-10(a) provides in relevant part: If an installment
of property taxes is not completely paid on or before the due date,
a penalty equal to ten percent (10%) of the amount of delinquent taxes
shall be added to the unpaid portion in the year of the initial
Ind. Code § 6-1.1-37-10(a). The prosecuting attorneys of this state
are specifically charged with the duty of enforcing this penalty. Ind. Code
§ 6-1.1-37-13 (providing that the prosecuting attorneys of this state shall enforce the
penalties prescribed in Chapter 37 of Article 1.1 of Title 6 of the
Indiana Code). Cf. Ind. Code § 6-1.1-30-14 (providing that the State Board
is generally charged with enforcing penalties under Article 1.1 of Title 6 of
the Indiana Code).
This Court, however, does not have jurisdiction to decide the issue
of whether the County properly imposed the late penalty because the State Board
did not make a final determination with regard to that issue.
Ind. Code § 33-3-5-2(a)(2). The Court notes that in other cases where
this Court did not have jurisdiction to decide a case because there was
no final determination by the State Board, the Supreme Court directed the taxpayer
to file its case in a court of general jurisdiction naming the county
officials as the defendant. See, e.g., State Bd. of Tax Commrs v.
L.H. Carbide Corp., 702 N.E.2d 706, 706-07 (Ind. 1998) (holding that taxpayer may
bring mandamus action in court of general jurisdiction against county officials where Tax
Court did not have jurisdiction because State Board did not make a final
determination because that County Board of Review never acted on or forwarded the
Form 133 Petition for Correction of Errors to the State Board); State Bd.
of Tax Commrs v. Mixmill Mfg., 702 N.E.2d 701, 704-05, 706 (Ind. 1998)
(holding that taxpayer may bring mandamus action in court of general jurisdiction against
county officials where the Tax Court did not have jurisdiction because State Board
did not make a final determination because that County Board of Review never
acted on or forwarded the Form 131 Petition for Review of Assessment to
the State Board); cf. Indiana Dept of Revenue v. Deaton, 755 N.E.2d 568,
571-72 (Ind. 2001) (holding that the Department may collect a tax judgment lien
by filing a proceeding supplemental in a court of general jurisdiction).
If on a motion to dismiss for failure of the pleading
to state a claim upon which relief can be granted,
matters outside the
pleading are presented to and not excluded by the court, the motion shall
be treated as one for summary judgment and disposed of as provided in
Rule 56. Ind. Trial Rule 12(B) (emphasis added); see also Williams v.
Indiana Dept. of State Revenue, 742 N.E.2d 562, 563 n.1 (Ind. Tax Ct.
2001). Because this Court has not excluded the exhibit, this 12(B)(6) motion
will be treated as a motion for summary judgment. See T.R. 12(B).
Whetzel filed a 133 Petition for Correction of Error (133 Petition)
with the County Auditor in this case. The Court notes that the
statute governing 133 Petitions does reference penalties.
See Ind. Code § 6-1.1-15-12(4).
The statute states that the auditor is required to correct mathematical errors
in computing penalties on taxes. See id. However, there is nothing
in the statute that provides for the determination of whether a penalty was