American Martial Arts Found. v. City of Portland

STATE OF MAINE Jo oe SUPERIOR COURT

CUMBERLAND, ss. aoe CIVIL ACTION

~ DOCKET NO. AP-99-86

TER- CUR af jv0e

ry

AMERICAN MARTIAL ARTS FOUNDATION,

Plaintiff

Vv. DECISION AND ORDER

CITY OF PORTLAND, BOARD OF

ASSESSMENT REVIEW, ET AL, SONALD L. GASBARCH

LAW Wibkare’

Defendants AWE id

FIUNIS 2h.

This matter is before the court on the Rule 80B appeal of the plaintiff

American Martial Arts Foundation ("Foundation") from the adverse decisions

of the defendants Richard Blackburn in his capacity as the Tax Assessor for

the City of Portland ("Assessor") and the City's Board of Assessment Review

("Board"). The Foundation challenges the Assessor's findings and decision

that it is not entitled to a property tax exemption as a "literary" organization

within the meaning of 36 M.R.S.A. § 652(1)(B)! and further challenges the

Board's jurisdiction to hear and decide tax exemption issues.

I. BACKGROUND

On February 1, 1999, the Foundation applied to the Assessor for

exemption from local taxes for the 1999-2000 tax year. Plaintiff's Exhibit

("Ex.") 1. On May 7, 1999, the Assessor denied the Application. Ex. 3. On

June 2, 1999, the Foundation appealed that decision to the Board.

1The statute provides that real and personal property "owned and occupied or

used solely for their own purposes by literary and scientific institutions” is exempt

from taxation. 36 M.R.S.A. § 652(1)(B) (1990).

At the hearing before the Board on September 14, 1999, the parties

agreed that the sole issue was "whether as of April 1, 1999 the Foundation

qualified as a ‘literary institution’ for purposes of 36 M.R.S.A. § 652." Exs. 34

& 35. The Board concluded that the Foundation did not qualify for tax

exempt status because its “literary pursuits were not of a primary or

substantial character.” Id.

I. DISCUSSION

A. Jurisdiction of the Board

The court disagrees with the Foundation's argument that the Board's

authority, which is limited to tax abatement issues pursuant to 36 M.R.S.A. §

843, does not empower it to review the exemption decision by the Assessor.

Berry v. Daigle, 322 A.2d 320, 324 (Me. 1974) ("The failure of an assessor to

grant an exemption is properly included within that category of over-

taxation subject to review by a proceeding for abatement"); Maine Cent. R.R.

Co. v. Town of Dexter, 588 A.2d 289, 292 (Me. 1991) ("An abatement

proceeding is a proper vehicle in which to challenge the taxation of

property claimed to be exempt"). In this 80B appeal, the court is more

properly called upon to review the determinations of the Board and does not

reach the plaintiffs arguments concerning the sufficiency or legality of the

Assessor's decision.

B. Constitutional Challenge

Preliminarily, the Foundation argued that the method and manner by

which the Assessor determined and denied its exemption application

constituted a violation of its rights of due process. However, this appeal

deals with the actions of the Board, not the Assessor, and the court need not

consider this argument. The Foundation has made no such claim regarding

the proceedings and actions by the Board and the court cannot conclude

that any such constitutional infirmities exist.

Cc. Decision of the Board

When reviewing an agency's decision, the court must uphold the

agency's findings of fact if supported by substantial evidence on the record

as a whole. MacDougall v. Dep’t of Human Servs., 2001 ME 64, 2 6, 769

A.2d 829, 831. Even if there is evidence that would support a contrary

result, the findings should be upheld if not clearly erroneous. Harold D.

Smith & Sons, Inc. v. Fin. Auth. of Maine, 543 A:2d 814, 816-17 (Me. 1988).

In its review process, the Board begins with the presumption that the

Assessor's determination is valid and "[t]he taxpayer has the burden of

overcoming that presumption." Town of Southwest Harbor v. Harwood,

2000 ME 213, I 7, 763 A.2d 115, 117. The Foundation did not meet its

burden. At the hearing before the Board, the Foundation presented

evidence of its nature, mission, the number of volumes in its library, its

course offerings, and the type of work performed by its teachers and

students. It also produced evidence that it uses the subject property for its

own purposes, and that its activities and purposes are educational in nature.

However, none of this is sufficient to compel a conclusion that the

Foundation is a literary institution.

"Literary"” has a meaning separate and distinct from that of

"educational," and while a literary institution is exempt under 36 M.R.S.A. §

652(1)(B), an educational institution? is not. See Hurricane Island Outward

Bound v Town of Vinalhaven, 372 A.2d 1043, 1047 (Me. 1977). Ascribing a

common and plain meaning to the term “literary institution,” the Board was

justified on this record in concluding "that the Foundation's literary pursuits

were not ofa primary or substantial character." See Ex. 34; Hurricane

Island, 372 A.2d at 1046. Accordingly, the court concludes that the

Foundation has not brought its case “unmistakably within the spirit and

intent of the act creating the exemption." Hurricane Island, 372 A.2d at

1046 (citataions omitted).

Based on this record, the court cannot conclude that the Board's

findings and conclusions (1) violated any constitutional or statutory

provisions; (2) exceeded the agency's statutory authority; (3) were based

upon any unlawful procedure; (4) were affected by bias or error of law; (5)

were unsupported by substantial evidence on the whole record; or (6) were

arbitrary or capricious or characterized by abuse of discretion. Munjoy

Sporting & Athletic Club v. Dow, 2000 ME 141, 9 6, 755 A.2d 531, 536

(citation omitted). In sum, the Foundation did not present "credible,

affirmative evidence" to meet its burden of persuading the Board that the

2"Literary” means "[plertaining to literature: connected with authors and the

study or use of books and writings." Buack’s Law Dictionary 841 (5th ed. 1979).

3"Educational institution" has been defined as "la] school, seminary, college.

university, or other educational establishment, not necessarily a chartered

institution.” BLack’s LAw DICTIONARY 461 (5th ed. 1979).

4

Assessor's decision was wrong. Town of Southwest Harbor, 2000 ME 213, 2

9, 763 A.2d at 118 (citation and internal quotation omitted).

lll. DECISION

Based upon all of the foregoing, and pursuant to MLR. Civ. P. 79(a), the

Clerk is directed to enter this Decision and Order on the Civil Docket by a

notation incorporating it by reference and the entry is

The decision of Defendant City of Portland, Board of Assessment

Review, is AFFIRMED.

Dated: May 31, 2002 ~ hy /

—= ustice, Hol ( Court

Date Filed __ 10-14-99 CUMBERLAND Docket No. __AP_ 99-86 _

County

Action APPEAL ~ 80(B)

: AMERICAN MARTIAL ARTS FOUNDATION CITY OF PORTLAND

A NON-PROFIT ORGANIZATION PRIMARILY THE BOARD OF ASSESSMENT REVIEW

DOING BUSINESS IN PORTLAND RICHARD BLACKBURN AS ASSESSOR OF THE

CITY OF PORTLAND

VS.

Plaintiff’s Attorney Defendant’s Attorney

PETER EVANS, ESQ 775-3101 CHARLES LANE, ESQ. -

PO BOX 427, PORTLAND ME 04112 PHOBAY 3909 oT

PORILAND, MAINE O41d2- 04101-3509

874-8459

Date of

Entry

1999

Oct. 14 Received 10-14-99:

Complaint summary sheet filed.

" " Complaint filed.

" " Jury Fee $300.00 PAID.

Oct. 15 On 10-15-99.

Breifing schedule mailed. Plaintiff's brief due 11-23-99.

Oct. 25 Received 10/21 ‘90:

Plaintiff's Motion to Specify the Future Course of Proceadings, Including Timing of Briefs

and Argiuments/Scope of Discovery and Other Pre-Trial Procesdirgs, Including Pre-Trial

Conferences, Pursuant to M.R.Civ.P. SOB(i) filed.

Nov. 19 Received 1118 /99:

Entry of Appearance of Charles Lane, Esq. on behalf of Defendants filed.

oom Acknowledgment of Receipt of Summons and Complaint filed.

- Charles Lane, Fsq. accepts service on behalf of Defendants on November 15, 1999.

Dec. 02 Received 12/02/99:

Motion to Dismiss filed on behalf of the Board of Assessment Review of the City of Portland

filed.

‘roam Defendant's Motion to Dismiss Count IT filed.

‘room Request for a Hearing on Defendant's Motion to Dismiss Count IT filed.

Dec. 03 Received 12/02/99:

Answer and Appearance of Comsel of the City of Portland and Richard W. Blackbum as Assessor

of the City of Portland filed.