2020-0358, Merrimack Premium Outlets, LLC & a. v. Town of Merrimack

contents of documents contained in the record. Merrimack Premium Outlets, The following facts were recited in the trial court’s orders or relate the

reverse and remand. this action challenging the Town’s reassessment of taxable property. We Merrimack (Town), cross - appeals, orders of the Superior Court (Colburn, J.) in Merrimack Premium Outlets Center, LLC, appeal, and the defendant, Town of HICKS, J. The plaintiffs, Merrimack Premium Outlets, LLC and

defendant. and Demetrio F. Aspiras on the brief, and Demetrio F. Aspiras orally), for the Drummond Woodsum & MacMahon, of Manchester (Matthew R. Serge

Ambriano on the brief and orally), for the plaintiff s. Sassoon Cymrot Law, LLC, of Hingham, Massachusetts (Anthony M.

MERRIMACK PREMIUM OU TLETS, LLC & a.

No. 2020 - 0358 Hillsborough - s outhern judicial district

http://www.courts.state.nh.us/supreme. release. The direct address of the court ’ s home page is: Opinions are available on the Internet by 9:00 a.m. on the morning of their reported by e mail at the following address: reporter@courts.state.nh.u s. corrections may be made before the opinion goes to press. Errors may be Doe Drive, Concor d, New Hampshire 03301, of any editorial errors in order that requested to notify the Reporter, Supreme Court of New Hampshire, One Charles as formal revision before publication in the New Hampshire Reports. Readers are NOTICE: This opinion is subject to motions for rehearing under Rule p. 2 22 as well 2

reconsideration. answer certain interrogatori es. It subsequently denied the plaintiffs’ motion for second motion for sanctions based upon the plaintiffs’ repeated failure to the trial court dismissed th at claim with prejudice when it granted the Town’s challenge for failure to state a claim, which the trial court denied. Thereafter, The Town also initially sought to dismiss the plai ntiffs’ constitutional

of the Property. “on the basis that the Town lacked the authority to change the assessed value” of the complaint for failure to stat e a claim, to the extent that it sought relief revaluation.” Based on that ruling, the court subsequently dismissed count II ownership change[s] to the [P]roperty following the p. 2 2016 town - wide t he 2017 tax year despite the fact that there were no physical, zoning, or Town had the legal authority to adjust the appraised value of the [Property] for statutory authority to make the 2017 reassessment. The court rul ed that “the court issued an order addressing, among other issues, whether the Town had pleadings to narrow the issues for trial. Accordingly, o n June 14, 2019, t he The parties requested that the court resolve certain legal issues on the

assessment.” “reassessment is an unauthorized, illegal and unconstitutional ‘spot’ other shopping center and retail out lets in the Town” and asserts that the belief,” that “the Town did not increase the tax year p. 2 2017 assessments of the it was “void and illegal.” The complaint also alleges, “[o]n information and that because “[t]he Town had no legal authority to make such a reassessment,” assessment methodology applied to all Town properties. The complaint asserts and (3) the increase in the assessment did not result from changes in did not correct any clerical or mathematical errors in the 2016 assessment; that: (1) the Property was not sold during that timeframe; (2) the reassessment Property or the market that justify the 2017 reassessment. It further alleges The plaintiffs’ complaint alleges that there were no changes in either the

and injunct ive relief. reassessment). The plaintiffs then brought this action for declaratory judgment reassessed the Property for the p. 2 2017 tax year at $154,149,500 (the 2017 believed that it had severe ly undervalued the Property. Accordingly, the Town valued for that purpose at $220,000,000. Based on this informati on, the Town Property had been used in or about 201 p. 3 3 as collateral for a loan and had been assessed at $86,549,400. Later that year, the Town became aware that the within the municipality. See RSA 75:8 - a (2012). A s a result, the Property was Property. In 2016, the Town conducted a revaluation of all taxable property outlet shopping mall, known as the Merrimack Premium Outlets, on the Merrima ck Premium Outlets Center, LLC. The latter entity operates a retail LLC owns a large property in Merrimack (the Property) that it leases to 3

contend that no such change occurred here. has been a change in a property within the express terms of RSA 75:8.” They town - wide reappraisal, that proportionality can only be modified when there The plaintiffs argue that “[o]nce proportion ality is achieved by the ‘ 5 - year ’

(discussing prior version of statute). are at full and true value.” RSA 75:8 - a; cf. LLK Trust, 159 N.H. at 7 p. 3 36 shall reappraise all real estate within the municipality so that the assessments (2012). In addition, at least every five years, “[t]he assessors and/or selectmen municipality.” LLK Trust, 159 N.H. at 736 (quotation omitted); see RSA 75:8, I annually so that all assessments are reasonably proportional within that RSA 76:2 (Supp. 20 2 0); RSA 74:1 (2012). “The Town must adjust assessments of property located in a town as of April 1.” LLK Tr ust, 159 N.H. at 736; see runs from April 1 to March 31” and “[t] axes are assessed based upon the value LLK Tr ust v. Town of Wolfeboro, 159 N.H. 734 (2010). Specifically, “a tax year We described New Hampshire’s statutory property tax scheme in

omitted). but rather within the context of the statute as a whole.” Id. at 486 - 87 (citation or unjust result. Moreover, we do not consider words and phrases in isolation, parts of a statute together to effectuate its overall purpose and avoid an absurd language that the legislature did not see fit to include.” Id. “We construe all as written and will not consider what the legislature might have said or add ordinary meaning.” Id. at 486. “We interpret legislative intent from the statute itself, and, if possible, construe that language according to its plain and When interpretin g statutes, “[w] e first look to the language of the statute

Virgin v. Fireworks of Tilton, 172 N.H. 484, 486 (2019) (quotation omitted). eng age in statutory interpretation, and, therefore, our review is de novo.” authorized remedies.” Id. Accordingly, “[r] esolving this issue requires us to mistaken property tax valuations can be corrected only through legislatively Nashua, 14 p. 3 3 N.H. 140, 143 (1998) (quotation and citations omitt ed). “A s such, is not to be extended by implication.” Pheasant Lane Realty Tr ust v. City of solely by statute, the right to tax must be found within the letter of the law and in order to correct a prior undervaluation. “Because the power to tax arises that the Town had the authority t o reassess the Property for the 2017 tax year We begin with the plaintiffs’ argument that the trial court erred in ruling

spot assessment claim. erred in denying the Town’s motion to dismiss the pla intiffs’ unconstitutional a discovery sanction. The Town cross - appeals, arguing that the trial court to the Property; and (2) dismissing their constitutional claim with prejudice as re assessment when there had b een no physical, zoning, or ownership changes erred in: (1) ruling that the Town had statutory authority to make the 2017 The plaintiffs now appeal, arguing, in pertinent part, that the trial court p. 4 4

disagree. of the Property here satisfies any ‘change’ requirement in the statute.” We manifestations.” It argues that “the discovery of the extreme underassessment requirement in RSA 75:8, I, “[n]othing limits such ‘changes’ to physical The Town nevertheless contends th at even if there is a “change”

property’s assessment under RSA 75:8, I. “change” is a prerequisite to a municipality’s legal authority to adjust a added). Based on that plain language, w e agree with the plaintiffs that some annually “adjust assessments to reflect changes.” RSA 75:8, I (emphasis r ather, the y rely on paragraph I, which directs assessors and selectmen to rely on paragraph II of the statute, a nd the changes explicitly listed therein; The Town misconstrues the plaintiffs’ argumen t. The plaintiffs do not

a djust ment under other conditions.” present. It neither mandates such an adjustment, nor does it preclude an ‘consider’ adjusting assessments if one of the enumerated conditions is the Town, the statute is not mandatory, but “merely d irect s the municipality to on why the Selectmen may consider adjusting an assessment.” According to contends, because “[t]he plain language of RSA 75:8, II contains no limitation of the conditions listed in RS A 75:8, II.” That reading is erroneous, the Town 75:8 under which “no change in assessment may occur unless it satisfies one The Town argues that the p l aintiffs urge a “restrictive reading” of RSA

(f) Have undergone other changes affecting value. mergers; or (e) Have undergone subdivision, boundary line adjustments, or (d) Have undergone changes to exemptions, credits or abatements; (c) Have undergone zoning changes; (b) Changed in ownership; (a) They know or believe have had a material physical change;

properties that: II. Assessors and selectmen shall consider adjusting assessments for any

RSA 75:7. inventory of that municipality and shall be sworn to in accordance with municipality. All adjusted assessments shall be included in the that all assessments are reasonably proportion al within that assessors and selectmen shall adjust assessments to reflect changes so I. Annually, and in accordance with state assessing guidelines, the

RSA 7 p. 5 5:8 provides: 5

standards. belief at its full value, in accordance with state appraisal taxable property was appraised to the best of our knowledge and inventory for the purpose of assessing the foregoing taxes all __________, certify under the penalty of perjury that in making the peace or notary public: We, the selec tmen and assessors of following oath, which may be subscribed before any justice of the their respective tow ns, to be recorded in the clerk’ s records, the and nonresident taxes, furnished by them to the town clerks in the copies or original inventories and assess ments of both resident The selectmen and assessors shall take and subscribe upon

consider RSA 7 p. 5 5:7, which provides: The Town next argues that when interpreting RSA 75:8, we must

the Town itself acknowledges, it “severely undervalued the [P] roperty in 2016.” value for the Property in 2016 — the Property’s value did not change; rather, as $1 p. 5 54,149,500 i s the correct value for the Property in 2017, it is also the correct assuming, under the facts of this case, that the adjusted assessment of change in what the acquirer knows about the property’s value. In other words, bearing on a property’s value is not a change in value itself; it is merely a purposes of R SA 75:8, II(f). Again, we disagree. Acquisition of information value,” that discovery constituted “an actionable change ‘affecting value’” for Assessor became aware of new information bearing directly on the Property’s by personal examination.” RSA 75:1. The Town reasons that when “the them relative to the value of property, the value of which cann ot be determined selectmen shall receive and consider all evidence that may be submitted to satisfied here, relying also on the portion of RSA 75:1 that provides: “The T he T own contends that th e catchall provision in RSA 75:8, II(f) is

change in the property’s market value. that adjustment to an assessment pursuant to RSA 7 p. 5 5:8, I, requires a n actual Reading RSA 75:8 as a whole and in conjunction with RSA 75:1, we conclude payment of a just debt due from a solvent d ebtor.” RSA 75:1 (Supp. 2020). mean[ing] the property’s full and true value as the same would be appraised in than certain types of property specifically excepted, “at its market value[,] . . . at 73 p. 6 6. RSA 75:1 requires the selectmen to appraise all taxable property, other “[t]axes are assessed based upon the value of property.” LLK Trust, 159 N.H. value.” RSA 75:8, II(f). Also informing our interpretation is recognition th at the final, cat chall phrase, the listed events are all changes that may “affect[] assessors and selectmen to adjust a property’s assessment. As evidenced by paragraph II of that statute, which lists a number of events that might prompt To discern the meaning of “changes” in RSA 75:8, I, we first look to 6

reassessment was necessary to ensure the proportionality required under RSA For similar reasons, we reject the Town’s arguments that the 2017

was made. RSA 75:7 (emphasis added). accuracy of the last legally - authorized appraisal or adjustment at the time it of our knowledge and be lief at its full value” must be read as certify ing the that the oath in RSA 75:7 that “all taxable property was appraised to the best Compare RSA 75:8 (2012), with RSA 75:8 (1991). Accordingly, we conclude know n errors in valuation prior to the next municipality - wide reappraisal. That statutory scheme, in its current form, does not allow for correction of even statutes in the context of the overall statutory scheme and not in isolation”). v. Town of Acworth, 173 N.H. p. 6 660, 667 (2020) (noting that “we interpret reflect changes in value. See RSA 75:8, :8 - a; N. New England Tel. Operations every five years and a limited authority to adjust assessments annually to scheme, which sets forth a system of municipality - wide reappraisals at least that the former statute mus t be read in the context of the overall statutory To the extent that RSA 75:7 may seem to conflict with RSA 75:8, we note

143. erroneous property tax valuations. Pheasant Lane Realty Tr ust, 143 N.H. at include.”). Moreover, we will not extend by implication the authority to correct might have said or add language that the legislature did not see fit to intent from the statute as written and will not consider what the legislature language into the statute. See Virgin, 172 N.H. at 48 p. 6 6 (“We interpret legislative and we will not, under the guise of statutory interpretation, reinsert that RSA 75:8 no longer contains the language mandating the correction of errors, (1991)). Following its repeal and reenactm ent in 2001, see Laws 2001, 158:53, appraisal.’” Tennessee Gas Pipeline, 145 N.H. a t 605 (quoting RSA 75:8 April in each year, ... correct all errors that they find in the then existing RSA 75:8, which provide d that “‘ assessors and selectmen shall, in the month of Tennessee Gas Pipeline, however, was decided under a prior version of

including if a property is mistakenly undervalued in a prior tax year.” adjustments to assessed values may be made for any number of reasons, Town of Hudson, 145 N.H. 598 (2000), to conclude that the “annual construed RSA 75:8, relying on our decision in Tennessee Gas Pipeline C o. v. RSA 75:8 the ability to correct an undervaluation. The trial court similarly do more than read RSA 75:7 and RSA 75:8 harmoniously; it seeks to read into statutes.” In re A.D., 172 N.H. 438, 441 (2019). The Town, however, seeks to will lead to reasonable results and effectuate the legislative purpose of the we construe them so that they do not contradict each other, and so that they “When interpreting t wo statutes that deal with a similar subject matter,

the oath taken in RSA p. 7 75:7.” RSA 75:8, II would significantly curtail an official’s ability to faithfully carry out RSA 75:7 (2012). The Town argues that “[t] o accept the [plaintiffs’] reading of 7

M AC DONALD, C.J.