The opinion
Filed 3/17/25 Polk v. Franchise Tax Board CA2/8
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION EIGHT
JANELLE R. POLK, B331399
Los Angeles County
Plaintiff and Appellant,
Super. Ct. No. 22BBCV00511
v.
FRANCHISE TAX BOARD,
Defendant and Respondent.
APPEAL from a judgment of the Superior Court of Los
Angeles County. Margaret L. Oldendorf, Judge. Affirmed.
Janelle R. Polk, in pro. per., for Plaintiff and Appellant.
Rob Bonta, Attorney General, Tamar Pachter, Assistant
Attorney General, Lisa W. Chao and Douglas J. Beteta, Deputy
Attorneys General, for Defendant and Respondent.
___________________________
Plaintiff Janelle R. Polk appeals summary judgment
entered in favor of defendant Franchise Tax Board (FTB) in this
action for a tax refund for the years 2015, 2016, and 2018
(together, the relevant tax years). We affirm.
BACKGROUND
In each of the relevant tax years, plaintiff lived and was
employed in California. In 2015, she earned a combined $105,430
from Warner Bros. Entertainment, Inc. and New Line
Productions, Inc. In 2016, she earned about $110,000 from New
Line Productions, Inc. She also received distributions reported
on Internal Revenue Service forms 1099-R exceeding $20,000. In
2018, she earned about $215,245 from WB Studio Enterprises,
Inc. Each of her employers withheld state taxes from her
paychecks, and all these income sources reported her income to
the state.
Despite receiving this income, plaintiff failed to fully report
it on her state income tax returns. She reported no tax liability
for any of the relevant tax years and claimed a refund for all
amounts of state income tax withheld.
FTB disagreed with plaintiff’s calculation of her income tax
liability for each of the relevant tax years. In April 2022, it
mailed a notice of proposed assessment (NPA) to plaintiff
proposing a $10,846.41 additional tax, penalty and interest
assessment for the 2015 tax year. Plaintiff did not protest the
assessment. Accordingly, in August 2022 FTB mailed a state
income tax balance due notice (tax due notice) adopting the tax
and penalty amounts stated in the NPA and reflecting a balance
due of $1,151.21 in taxes, including a delinquency penalty, and
interest owed for the 2015 tax year.
2
In January 2021, FTB mailed an NPA to plaintiff proposing
a $6,558.38 additional tax, penalty and interest assessment for
the 2016 tax year. Plaintiff responded to this one. Following a
protest and appeal process, FTB issued a tax due notice in May
2022 adopting the tax and penalty amounts stated in the NPA
and reflecting a balance due of $6,823.39 in taxes, including a
delinquency penalty, and interest owed for the 2016 tax year.
In June 2022, FTB mailed an NPA to plaintiff proposing a
$28,137.98 additional tax, penalty and interest assessment for
the 2018 tax year. Plaintiff did not protest the assessment by the
deadline stated in the NPA. Accordingly, in September 2022 FTB
mailed a tax due notice adopting the tax and penalty amounts
stated in the NPA and reflecting a balance due of $28,441.56 in
taxes, including a delinquency penalty, and interest owed for the
2018 tax year.
Each NPA and tax due notice was mailed to plaintiff at an
address on Screenland Drive in Burbank, which was plaintiff’s
address last known to FTB.
In July 2022, plaintiff filed a complaint to recover the
amounts withheld from her wages for the relevant tax years.
FTB filed a motion for summary judgment on a single ground:
that plaintiff’s causes of action were barred by article XIII,
section 32 of the California Constitution (section 32). Section 32,
known as the “pay first, litigate later” rule, provides that an
action challenging the legality of a tax may be maintained only
after payment of the tax amount due. Thus, to prevail, FTB had
to establish that there were outstanding tax amounts due for the
relevant tax years.
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FTB’s motion was supported by two declarations, one by an
FTB employee, Jarrod Reiser, and the other by FTB’s counsel,
Douglas Beteta.
Mr. Reiser’s declaration attached the NPA and tax due
notice as to each of the relevant tax years, along with records
relating to plaintiff’s protest and appeal of the 2016 tax year
assessment, and Mr. Reiser offered testimony to authenticate
them. Mr. Reiser further attested that plaintiff owed $1,169.71
for the 2015 tax year; $6,990.27 for the 2016 tax year; and, in
paragraph 16 of his declaration, $27,444.76 “for the 2016 tax
year.” As discussed further below, Mr. Reiser meant to have said
the $27,444.76 was owed “for the 2018 tax year.”
Mr. Beteta’s declaration attached excerpts of responses
plaintiff had provided to FTB’s requests for admissions on
February 6, 2023, and Mr. Beteta offered testimony to
authenticate them. The excerpts show FTB requested that
plaintiff admit, among other things, that she “ha[d] not paid . . .
$13,495 in California income taxes and penalties for the 2015 tax
year” (request No. 5); “ha[d] not paid . . . $10,216 in California
income taxes and penalties . . . for the 2016 tax year” (request
No. 7); and “ha[d] not paid . . . $25,116 in California income taxes
and penalties for the 2018 tax year” (request No. 9). For each of
the relevant tax years, FTB also asked plaintiff to admit she had
not paid a delinquent return penalty (requests Nos. 6, 8 & 10).
Plaintiff responded to all of the foregoing requests for admission,
in relevant part, as follows: “[Plaintiff] has not paid any amounts
referenced in requests #5-11, but objects to any implication that
[plaintiff] concedes that any such amounts of tax or penalties are
(or ever were) due and payable.”
4
Plaintiff opposed FTB’s motion for summary judgment on
the sole ground that FTB failed to meet its evidentiary burden as
the moving party. Plaintiff asserted she “disputed” FTB’s facts,
but she did not submit any evidence in opposition to FTB’s
motion. Notably, plaintiff did not submit evidence she had made
any payment pursuant to the tax due notices; that she did not
receive the notices; that the address to which the notices were
sent was not her address at the time of sending; or that she had
provided FTB an updated address prior to when the notices were
sent.
Plaintiff mostly opposed FTB’s motion by objecting to FTB’s
evidence. Among other things, she objected to the relevance of
the various notices attached to Mr. Reiser’s declaration, including
the NPA’s and tax due notices, and to Mr. Reiser’s testimony
about the mailing of those notices. She made no objection to
Mr. Beteta’s declaration or the attached documents he
authenticated.
Plaintiff also argued there was no factual support for FTB’s
claimed undisputed material fact that she owed $27,444.76 for
the 2018 tax year. She noted that, even though the statement
referred to the 2018 tax year, paragraph 16 of Mr. Reiser’s
declaration cited in the statement referred to a balance for the
2016 tax year.
Six days before the hearing date, FTB submitted a
supplemental declaration of Mr. Reiser. In it, he explained the
paragraph 16 reference to the “2016 tax year” was intended to
say “ ‘the 2018 tax year.’ ” This was already apparent from the
context of the February 2023 declaration, as the stated amount
due roughly corresponded to the amount shown on the attached
tax due notice for the 2018 tax year described in the sentence
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immediately preceding, and Mr. Reiser had already attested to
the amount due for the 2016 tax year. Moreover, FTB’s separate
statement filed with its summary judgment motion recited that
plaintiff owed $27,444.76 for the 2018 tax year based on
paragraph 16 of Mr. Reiser’s declaration.
At the hearing on the motion, plaintiff attempted to object
to Mr. Reiser’s reply declaration on the grounds that it was
untimely. The trial court did not rule on her objection, explaining
it was “not considering” the reply declaration. In the trial court’s
order granting FTB summary judgment, however, the trial court
cited the reply declaration’s correction to establish plaintiff’s
outstanding balance for the 2018 tax year. As to the other two
tax years, the trial court found plaintiff had admitted “she ha[d]
not fully paid the balance due.”
Plaintiff timely appealed the judgment against her.
DISCUSSION
1. Summary Judgment Law and Standard of Review
On a motion for summary judgment, a defendant must
show “that one or more elements of the cause of action . . . cannot
be established, or that there is a complete defense to the cause of
action.” (Code Civ. Proc., § 437c, subd. (p)(2).) Summary
judgment is appropriate only “if all the papers submitted show
that there is no triable issue as to any material fact and that the
moving party is entitled to a judgment as a matter of law.” (Id.,
subd. (c).) A triable issue of material fact exists if the evidence
and inferences therefrom would allow a reasonable juror to find
the underlying fact in favor of the party opposing summary
judgment. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th
826, 850.)
Our Supreme Court has made clear that the purpose of the
1992 and 1993 amendments to the summary judgment statute
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was “ ‘to liberalize the granting of [summary judgment]
motions.’ ” (Perry v. Bakewell Hawthorne, LLC (2017) 2 Cal.5th
536, 542.) It is no longer called a “disfavored” remedy. (Ibid.)
“Summary judgment is now seen as ‘a particularly suitable
means to test the sufficiency’ of the plaintiff’s or defendant’s
case.” (Ibid.)
“ ‘We independently review an order granting summary
judgment. [Citation.] We determine whether the court’s ruling
was correct, not its reasons or rationale. [Citation.] “In practical
effect, we assume the role of a trial court and apply the same
rules and standards which govern a trial court’s determination of
a motion for summary judgment.” [Citation.]’ [Citation.] In
performing our de novo review, we view the evidence in the light
most favorable to . . . the party opposing summary judgment.”
(Scheer v. Regents of University of California (2022)
76 Cal.App.5th 904, 913.)
“ ‘We examine the evidence and independently determine
its effect. [Citation.] We must uphold the judgment if it is
correct on any ground, regardless of the reasons the trial court
gave.’ ” (Windsor Food Quality Co., Ltd. v. Underwriters of
Lloyds of London (2015) 234 Cal.App.4th 1178, 1184.)
2. Analysis
“ ‘A taxpayer ordinarily must pay a tax before commencing
a court action to challenge the collection of the tax. This rule,
commonly known as “pay first, litigate later,” is well established
and is based on a public policy reflected in the state Constitution,
several statutes, and numerous court opinions.’ [Citation.]
Section 32 provides: ‘No legal or equitable process shall issue in
any proceeding in any court against this State or any officer
thereof to prevent or enjoin the collection of any tax. After
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payment of a tax claimed to be illegal, an action may be
maintained to recover the tax paid, with interest, in such manner
as may be provided by the Legislature.’ This constitutional
provision establishes that ‘the sole legal avenue for resolving tax
disputes is a postpayment refund action. A taxpayer may not go
into court and obtain adjudication of the validity of a tax which is
due but not yet paid.’ ” (California Logistics, Inc. v. State of
California (2008) 161 Cal.App.4th 242, 247.)
A defendant in a tax refund action is entitled to summary
judgment where the undisputed material facts show the plaintiff
has not fully satisfied the tax obligations she challenges. (Rickley
v. County of Los Angeles (2004) 114 Cal.App.4th 1002, 1015
(Rickley).) The only question we must resolve on this appeal is,
therefore, whether FTB’s properly admitted evidence was
sufficient to show plaintiff had not paid all amounts FTB
asserted she owed for each of the relevant tax years before
attempting to obtain a refund for amounts her employers
withheld for those tax years. We conclude it was.
As detailed below, FTB’s evidence showed it mailed the tax
due notices, which included assessments for delinquency
penalties, to plaintiff’s last known address, thereby causing the
assessments to become due and payable 15 days later. (Rev. &
Tax. Code, § 19049, subd. (a).) Plaintiff admitted not having paid
any amount on account of delinquency penalties for any of the
relevant tax years. Accordingly, her action is barred by the pay
first, litigate later rule. (Rickley, supra, 114 Cal.App.4th at
pp. 1012-1014.)
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a. FTB’s properly admitted evidence established
asserted tax liabilities, including delinquency
penalties, for the relevant tax years.
Every person who meets the minimum filing requirements
is required to file a state income tax return, report income, and
pay any tax due to FTB. (Rev. & Tax. Code, § 18501.) FTB then
examines the return to determine the correct amount of the tax.
(§ 19032.) If FTB “determines that the tax disclosed by the
taxpayer . . . is less than the tax disclosed by its examination, it
shall mail notice to the taxpayer of the deficiency proposed to be
assessed.” (§ 19033, subd. (a).)
A taxpayer can protest the proposed deficiency assessment
within 60 days after it is mailed. (Rev. & Tax. Code, § 19041.) “If
no protest is filed, the amount of the proposed deficiency
assessment becomes final” after 60 days. (§ 19042.) If a protest
is filed, finality is delayed until the protest is resolved. (See
§§ 19044, 19045, 19047, 19048.) After the assessment becomes
final, FTB must mail notice and demand payment for the
assessment to become due and payable. (§ 19049, subd. (a).) The
assessment becomes due and payable 15 days from the date of
notice and demand. (Ibid.)
For these reasons, notwithstanding plaintiff’s contentions
to the contrary, the NPA’s and tax due notices FTB put into
evidence were plainly relevant to establishing plaintiff had
unpaid asserted tax liabilities for the relevant tax years. When
mailed, the tax due notices made the asserted amounts due and
payable 15 days thereafter. This is true whether or not plaintiff
agreed with the assessments.
Plaintiff concedes Mr. Reiser properly authenticated the
tax due notices. But she argues his declaration is inadequate to
9
establish they were mailed to her last known address. We
disagree.
Preliminarily, we find frivolous any suggestion the record
fails to show the Screenland Drive in Burbank address to which
all notices were sent was plaintiff’s address last known to FTB.
In addition to Mr. Reiser’s testimony, other documents in the
record show plaintiff received notices at the Screenland Drive
address. She attached notices mailed there in relation to her
July 2021 administrative appeal relating to the 2016 tax year,
she used the address in communicating with FTB regarding the
same July 2021 administrative appeal1, and it is the same
address plaintiff used in this lawsuit, beginning with her
complaint.
Mr. Reiser testified that notices addressed to the
Screenland Drive address were actually mailed there, after
verification that it was her last known address, based upon his
knowledge of FTB’s mailing practices. Evidence of customary
mailing practices is admissible to prove mailing on a specific
instance. For example, in Kiernan v. Union Bank (1976) 55
Cal.App.3d 111 (Kiernan), testimony of a bank officer that “it was
the unvarying practice of [the bank] to mail to each customer
with a commercial checking account a monthly statement listing
all checks paid on that account since the previous statement,
together with all cancelled checks, by the third business day of
each month” was sufficient to support summary judgment in the
bank’s favor where mailing was a material fact. (Id. at p. 116.)
1 Plaintiff objected to admission of this document on
relevance grounds only and the trial court overruled her
objection. We find the document relevant.
10
Here, Mr. Reiser’s testimony was akin to the bank officer’s
testimony in Kiernan. Mr. Reiser testified that he located the tax
due notices in FTB’s archives. He further testified that notices
are placed in FTB archives only after they are mailed, and the
mailing process for notices is as follows: “FTB staff first verifies
a taxpayer’s last known address, prints the notice, places it in a
sealed envelope, and then places the envelope in an outgoing mail
bin. The bin is taken to a mail room from where a post office
employee picks it up.” We reject plaintiff’s attempts to
distinguish Kiernan, including on “the most crucial difference . . .
that the Kiernan case did not involve a motion for summary
judgment.” In fact, it did. (Kiernan, supra, 55 Cal.App.3d at
p. 114.)
Plaintiff responds that Mr. Reiser’s testimony does not
amount to personal knowledge of mailing and leaves unanswered
the questions of who followed FTB’s mailing procedures and who
actually mailed the letter. “Testimony that an act occurred,
based on the witness’ knowledge that the performance of that act
is part of an invariable and long-continued business custom or
habit, is treated as though the performance of the act itself is
within the personal knowledge of the witness.” (Kiernan, supra,
55 Cal.App.3d at p. 116.) There is no requirement that mailing
may be proved only by testimony of those persons who actually
effected it. (Jenkins v. Tuneup Masters (1987) 190 Cal.App.3d 1,
11 [rejecting contention that “evidence of mailing based upon
habit and custom must be supported by testimony from all of the
employees in the chain of custody coupled with proof of
compliance with that custom on the occasion in question”].)
The trial court did not err in admitting the tax due notices
and admitting Mr. Reiser’s testimony that they were mailed to
11
plaintiff’s address on Screenland Drive in Burbank after
confirmation that such address was the address for plaintiff last
known to FTB.
Plaintiff attempts to show that the tax due notice for the
2015 tax year cannot subject her to tax liability because it was
untimely under Revenue and Taxation Code section 13516 and
reflects that it was determined without reviewing her return in
violation of Wertin v. Franchise Tax Bd. (1998) 68 Cal.App.4th
961. However, she relies solely on her own allegations as the
factual predicates for these arguments. “A party opposing
summary judgment may not ‘rely upon the allegations or denials
of its pleadings’ but must set forth ‘specific facts’ beyond the
pleadings to show the existence of a triable issue of material fact.
([Code Civ. Proc.,] § 437c, subd. (p)(2).)” (Choi v. Sagemark
Consulting (2017) 18 Cal.App.5th 308, 318.) Moreover, plaintiff’s
arguments, like her entire refund action claiming no state tax
liability for any of the relevant tax years, go to the validity of the
assessment, and she fails to explain how such arguments are
exempt from the pay first, litigate later rule.
b. FTB’s properly admitted evidence established
plaintiff had not fully satisfied the assessments
against her, including delinquency penalties,
before bringing her refund action.
Plaintiff’s responses to FTB’s requests for admissions
establish she filed this lawsuit without having satisfied all
asserted liabilities for taxes and associated penalties.
Plaintiff argues that when she acknowledged in response to
FTB’s requests for admissions that she did not pay “any amounts
referenced in requests #5-11,” she was admitting only that she
did not pay the specific dollar amounts in the requests for
admissions Nos. 5, 7 and 9. However, plaintiff did not offer any
12
evidence that she had paid the full amount of the assessments
FTB made against her. The exact amounts of her payments and
the exact amounts of the asserted tax balance are immaterial.
FTB was entitled to summary judgment because plaintiff did not
dispute there was some outstanding asserted balance.
In the same responses to requests for admissions Nos. 5
through 11, plaintiff also admitted she “ha[d] not paid any
amounts” for “a delinquent return penalty for the 2015 tax year”
(request No. 6); for “a delinquent return penalty for the 2016 tax
year” (request No. 8); or for “a delinquent return penalty for the
2018 tax year” (request No. 10). A delinquent return penalty was
asserted as due in the tax due notice for each of the relevant tax
years, and plaintiff’s admission that she did not pay any
delinquent return penalties is an admission she had not satisfied
all asserted amounts and therefore did not comply with the pay
first, litigate later rule. (See Rickley, supra, 114 Cal.App.4th at
pp. 1012-1014 [unpaid tax delinquency penalty sufficient to
support application of § 32].)
DISPOSITION
The judgment of the trial court is affirmed. FTB is to
recover its costs on appeal.
GRIMES, Acting P. J.
WE CONCUR:
WILEY, J.
VIRAMONTES, J.
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