# Herbert G. Bliss v. Lafayette Parish School Board Sales Tax Division

> Louisiana Court of Appeal · December 18, 2019

URL: https://www.frixlaw.com/law-library/cases/11294076

## Case

- **Court:** Louisiana Court of Appeal
- **Decided:** December 18, 2019
- **Opinion:** Opinion
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

STATE OF LOUISIANA
COURT OF APPEAL, THIRD CIRCUIT

19-186

HERBERT G. BLISS

VERSUS

LAFAYETTE PARISH SCHOOL BOARD

SALES TAX DIVISION, ET AL.

**********

APPEAL FROM THE
FIFTEENTH JUDICIAL DISTRICT COURT
PARISH OF LAFAYETTE, NO. 20175290
HONORABLE EDWARD D. RUBIN, DISTRICT JUDGE

**********

JOHN D. SAUNDERS
JUDGE

**********

Court composed of John D. Saunders, Phyllis M. Keaty, and Jonathan W. Perry,
Judges.

AFFIRMED.
Drew M. Talbot
Rainer Anding & Talbot
8480 Bluebonnet Boulevard, Suite D
Baton Rouge, LA 70810
(225) 766-0200
COUNSEL FOR DEFENDANT/APPELLEE:
Lafayette Parish School Board Sales Tax Division
Brent Hebert

Adam G. Young
Meade Young, LLC
556 Jefferson Street, Suite 200
Lafayette, LA 70501
(337) 534-0200
COUNSEL FOR PLAINTIFF/APPELLANT:
Herbert G. Bliss
SAUNDERS, Judge.

This is a tax collection case. Tax collector followed the procedure outlined in

La.R.S. 47:337.51 and issued a notice of assessment to Taxpayer. Taxpayer

attempted to challenge the assessment by filing a declaratory judgment suit in the

trial court without first paying the amount assessed under protest. The trial court

found that this challenge was not allowed under La.R.S. 47:337.51, as the

assessment was final. Taxpayer has appealed.

FACTUAL AND PROCEDURAL HISTORY:

During all relevant periods at issue, Herbert Bliss operated as a sole

proprietorship doing business under the trade name, “Cork’s Automotive”

(Taxpayer). Taxpayer makes repairs to automobiles for his customers in Lafayette

Parish. Repairs to articles of tangible personal property, such as automobiles, are

one of the specifically enumerated services subject to state and local taxes. As such,

Taxpayer is a “dealer” required to charge, collect, and remit Lafayette Parish sales

taxes to Collector on taxable sales made by him.

The Lafayette Parish School Board, a political subdivision of this state

authorized to collect local sales and use tax (Collector)1, conducted a sales and use

tax compliance audit of Taxpayer for the tax period beginning January 1, 2014

continuing through December 31, 2016. As part of the Collector’s audit, Collector

reviewed certain sales records in Taxpayer’s possession, care, custody and control.

The audit revealed a substantial sales and/or use deficiency. Collector, in conformity

with La.R.S. 47:337.48(B), issued to Taxpayer a thirty-day Notice of Intent to

Assess.

1
A “political subdivision” is any parish, municipality, special district, school board, sheriff,
public board, institution, department, commission, district, corporation, agency, authority or an
agency or subdivision of any of these, and other public or governmental body of any kind which
is not a state agency. La.R.S. 13:5102.
In response to the Notice of Intent to Assess, Taxpayer requested a hearing

pursuant to La.R.S. 47:337.49, to raise any factual or legal objections to the

assessment. Taxpayer’s protest alleged that certain taxable repair transactions were,

in fact, transactions related to work covered under a warranty, and thus, not taxable.

On August 2, 2017, pursuant to a previous scheduling agreement, Taxpayer’s

protest hearing was held at Taxpayer’s counsel’s office; Collector’s auditor, Brent

Hebert (Mr. Hebert), appeared in person on behalf of Collector; and Taxpayer’s

counsel advised Mr. Hebert that supplemental information regarding the underlying

substantive tax would be provided “in the next 5 business days.” Thereafter,

Collector twice extended Taxpayer’s deadline to produce the supplemental sales

records.

On August 17, 2017, after receipt and review of the additional records

provided by Taxpayer, Collector made its final determination and issued a “Notice

of Assessment and Right to Appeal” to Taxpayer notifying Taxpayer that “he has

thirty calendar days from the date of the notice to do any of the following: (a) Pay

the amount of the assessment; (b) Appeal to the Board of Tax Appeals for

redetermination of the assessment; or (c) Pay under protest in accordance with

La.R.S. 47:337.63, and then either file suit or file a petition with the Board of Tax

Appeals, all as provided for in that Section.” The Assessment was received by

Taxpayer.

On September 14, 2017, in response to Collector’s Notice of Assessment,

Taxpayer filed suit in the Fifteenth Judicial District Court, Parish of Lafayette,

seeking a judgment declaring that the Assessment is “null and void.” Alternatively,

Taxpayer’s suit seeks a declaration that the Assessment is inaccurate and improperly

calculated. Taxpayer’s suit also seeks a money judgment for alleged “damages”

against Collector’s auditor, Brent Hebert (Mr. Hebert), personally.
2
Collector responded to Taxpayer’s Petition by filing the Peremptory

Exceptions of Peremption, No Cause of Action and No Right of Action, and the

Declinatory Exception of Lack of Jurisdiction over the Subject Matter (collectively

referred to hereafter as the “Exceptions”). Mr. Hebert responded to the Petition by

filing the Peremptory Exception of No Cause of Action.

The trial court heard and sustained Collector’s Exceptions and dismissed

Taxpayer’s Petition with prejudice. As part of the trial court’s analysis and based

upon the representations and arguments of Taxpayer, the trial court found that there

was no possible way for Taxpayer to cure any pleading defects given Taxpayer’s

admission that he did not respond to the Assessment within thirty calendar days to

protest or appeal the Assessment in any of the manners specifically enumerated by

law. Similarly, based upon its reasoning and rationale for granting Collector’s

Exceptions, the trial court also granted Mr. Hebert’s Peremptory Exception of No

Cause of Action and dismissed Taxpayer’s Petition, with prejudice, as to Taxpayer’s

claims made against him personally.

The trial court signed a judgment in accordance with its ruling granting

Collector’s Exceptions. In response to the judgment, Taxpayer filed a Motion

requesting a New Trial. Taxpayer’s Motion was set for hearing, and the trial court

heard Taxpayer re-argue his previously rejected arguments. Thereafter, the trial

court denied Taxpayer’s Motion for New Trial and rendered judgment accordingly.

Taxpayer appeals this judgment, alleging four assignments of error.

ASSIGNMENTS OF ERROR

1. The trial court erred in finding the Plaintiff failed to state a cause of
action for declaratory judgment because the Plaintiff did not allege
he paid assessed taxes in protest before filing suit for a declaratory
judgment on the validity of the assessment itself.

3
2. The trial court erred in finding the Petition failed to state facts
supporting an exception to the qualified immunity provisions of
La.R.S. 9:2798.1.

3. The trial court erred [sic] applying the incorrect legal standards to
the exception of no cause of action.

4. The trial court erred by failing to grant Plaintiff leave to file an
amended petition.

ASSIGNMENT OF ERROR NUMBER ONE:

Taxpayer’s first assignment of error is that the trial court erred in finding that

he failed to state a cause of action for declaratory judgment. We find no merit to

this assignment of error.

This court reviews legal conclusions of the trial court using a de novo standard

of review. “The interpretation of the statutory law presents us with a question of law

which is reviewed under a de novo standard of review.” State v. McKinnies, 13-

1412, p. 7 (La. 10/15/14), 171 So.3d 861, 867.

The Uniform Local Sales Tax Code found at La.R.S. 47:337.1 through 337.64

(the “ULSTC”) is the body of law that governs the “assessment, collection,

administration and enforcement” of local sales and use taxes. See La.R.S.

47:337.2A(1)(b). The Supreme Court has stated, “It is well settled that laws

regulating the collection of taxes,” such as the ULSTC, “are sui generis and

constitute a system to which the general provisions of the Civil Code have little, if

any application.” Church Point Wholesale Beverage Co., Inc. v. Tarver,

(La.2/22/93), 614 So.2d 697, 708.

Guided by this principle of law, we review the unique sue generis substantive

and procedural statutes found in the ULSTC at La.R.S. 47:337.48 through La.R.S.

47:337.64.

4
Louisiana Revised Statutes 47:337.48(A)(1) provides, in pertinent part:

If a taxpayer fails to make and file any return or report required
by the provisions of the local ordinance . . . the collector shall determine
the tax, penalty, and interest due by estimate or otherwise. Having
determined the amount of tax, penalty, and interest due, the collector
shall send by mail a notice to the taxpayer . . . setting out his
determination and informing the person of his purpose to assess the
amount so determined against him after fifteen calendar days from the
date of the notice.

Louisiana Revised Statutes 47:337.49(A) provides, in pertinent part:

The taxpayer, within fifteen calendar days from the date of the
notice provided in R.S. 47:337.48(A) or within thirty calendar days
from the date of the notice provided in R.S. 47:337.48(B), may
protest . . . in writing and should fully disclose the reasons, together
with facts and figures in substantiation thereof, for objecting to the
collector's determination. The collector shall consider the protest, and
shall grant a hearing thereon, before making a final determination of
tax, penalty, and interest due.

Louisiana Revised Statutes 47:337.51(A)(1) provides that a tax collector shall

send a notice of the assessment to the taxpayer and shall inform the taxpayer that he

has “thirty calendar days from the date of the notice” to do any of the following:

(a) Pay the amount of the assessment.

(b) Appeal to the Board of Tax Appeals for redetermination or
assessment.

(c) Pay under protest in accordance with R.S. 47:337.63, and then
either filed suit or file a petition with the Board of Tax Appeals, all
as provided for in that Section.

As provided in La.R.S. 47:337.51(B), a dealer who disputes “any findings or

assessment of the collector” may, “within thirty days of the receipt of notice of the

assessment or finding,” do any of the following:

(1)(a) File an appeal from the decision of the collector directed to the
Board of Tax Appeals.

(b) Pay under protest in accordance with R.S. 47:337.63, and either file
suit as provided for in that Section, or file a petition with the Board of
Tax Appeals, as provided in that Section.

5
In Jefferson Davis Parish School Board, ex rel v. Louisiana Machinery

Rentals, LLC., 11-510, 11-512, pp. 4-5 (La.App. 3 Cir. 10/5/11), 74 So.3d 1272,

1275-76, writ denied, 11-2437 (La. 1/13/12), 77 So.3d 972, this Court noted:

“When a law is clear and unambiguous and its application does not lead
to absurd consequences, the law shall be applied as written and no
further interpretation may be made in search of the intent of the
legislature.” La.Civ.Code art. 9. We find the language of La.R.S.
47:337.51(B) to be clear. A [Taxpayer], has three avenues it could take
once it receives an assessment: file an appeal to the assessment, pay the
assessment under protest, or simply pay the assessment. Each avenue
requires the dealer to take action once it receives an assessment. If no
action is taken by the [Taxpayer], the assessment becomes final. This
interpretation is consistent with this court’s finding in Lafayette Parish
School Board v. Simmons, 09-926, p. 1 (La.App. 3 Cir. 3/17/10), 33
So.3d 973, 974, wherein it stated, “the School Board’s Sales and Use
Tax Collection Division issued a Notice of Assessment in accordance
with La. R.S. 47:337.51, which required action on the part of the
defendants within sixty days. A failure to act within the sixty-day
period results in a final enforceable assessment.”

Taxpayer argues that as a result of Collector’s audit he received a Notice of

Intent to Assess which he timely protested. Taxpayer asserts that due to Collector’s

failure to conduct a hearing on his tax protest, he is entitled to a declaration that the

assessment is “null and void.” Alternatively, Taxpayer contends that he is entitled

to a declaration that the Assessment is inaccurate and improperly calculated.

Taxpayer concedes that Collector’s auditor, Mr. Hebert, met with Taxpayer’s

counsel in person on behalf of Collector to discuss what accounting methods and

other sources of proof would be needed to resolve the issue raised. However,

Taxpayer avers that because no examinations were made, no testimony was offered,

and no record was created, Taxpayer was not afforded a fair hearing. Taxpayer

maintains that because the requirements of La.R.S. 47:337.49 were not met before

Collector issued the final assessment, La.R.S. 47:337.51(B)(1) cannot apply to

require a Taxpayer to pay in protest before bringing a declaratory judgment action.

6
Collector argues that its pre-assessment procedure was proper. Collector

maintains that although “hearing” is not defined in the ULSTC, Taxpayer offered a

definition of “hearing” in his original brief, which he cites from Black’s Law

Dictionary as “Any setting in which an affected person presents arguments to a

decision-maker.” Collector contends that accepting all allegations set forth in

Taxpayer’s Petition and the documents annexed thereto as true, Taxpayer received

a “hearing” by his own proposed definition.

We find that the pre-assessment procedure was proper. “Hearings” are not

defined within the ULSTC, and as such no specific format is sacrosanct. What is

required is that the taxpayer be given an opportunity to present his position and that

the collector is able to hear and consider this contention. We find that Taxpayer

received a fair hearing pursuant to La.R.S. 47:337.49. First, the “hearing” took

place in person at Taxpayer’s counsel’s offices pursuant to scheduling between

Collector and Taxpayer’s counsel. Second, Taxpayer’s counsel made arguments on

behalf of Taxpayer, the affected person. Third, Taxpayer admits that there was a

discussion between Collector’s auditor, Mr. Hebert, and Taxpayer’s counsel

regarding submitting additional records to Collector. Finally, the “hearing” was

with Collector’s auditor, Mr. Hebert. Mr. Hebert was the person in charge of

holding the hearing, receiving supplemental documentation, and rendering a final

determination. In addition, Collector twice extended Taxpayer’s deadline to

produce the supplemental records. Thereafter, Collector reviewed the supplemental

records prior to rendering its decision. Taxpayer has not and cannot point to any

authority that supports the proposition that the legislature intended for individuals

in local governments to follow a specific format in order to meet the definition of a

“hearing” pursuant to the ULSTC. Our reasons for finding that Taxpayer received

a fair hearing are that the record shows that Taxpayer was given an opportunity to
7
present his position and Collector was able to hear and consider this contention.

There has been no claim that Collector’s Assessment notice failed to adequately

and properly advise Taxpayer of his administrative rights in accordance with La.R.S.

47:337.51(A). Under this statute, the only forum which Taxpayer can protest the

Notice of Assessment and seek judicial review and potential redetermination

without first paying the tax under protest is in the Louisiana Board of Tax Appeals.

The suit record clearly shows that Taxpayer failed to timely act to properly appeal

or protest Collector’s Assessment in any of the manners specifically enumerated by

law. Accordingly, we find no error in the trial court’s ruling that in order for

Taxpayer to pursue his action in the trial court, Taxpayer was first required to pay

the amounts assessed under protest, which he failed to do.

ASSIGNMENT OF ERROR NUMBER TWO:

Taxpayer’s second assignment of error is that the trial court erred in finding

that the Petition failed to state facts supporting an exception to the qualified

immunity provisions of La.R.S. 9:2798.1. We find no merit to this assignment of

error.

Louisiana Revised Statutes 9:2798.1 2 exempts public entities and their

employees from liability for their “discretionary or policy-making acts.” Hardy v.

2
Louisiana Revised Statutes 9:2798.1 states reads:

A. As used in this Section, “public entity” means and includes the state and any of
its branches, departments, offices, agencies, boards, commissions,
instrumentalities, officers, officials, employees, and political subdivisions and
the departments, offices, agencies, boards, commissions, instrumentalities,
officers, officials, and employees of such political subdivisions.

B. Liability shall not be imposed on public entities or their officers or employees
based upon the exercise or performance or the failure to exercise or perform
their policymaking or discretionary acts when such acts are within the course
and scope of their lawful powers and duties.

8
Bowie, 98-2821, p. 9 (La. 9/8/99), 744 So.2d 606, 613. ‘“Under [the discretionary

function] doctrine, governmental decision makers exercising discretionary functions

are immune from suit, because the courts should not chill legislative discretion in

policy formation by imposing tort liability for discretionary decision.’” Id. (quoting

Ferdinand F. Stone and Andrew Rinker, Jr., Governmental Liability for Negligent

Inspections, 57 Tul.L.Rev. 328, 346 (1982)) (alteration in original).

Taxpayer argues that he is entitled to a money judgment for alleged “damages”

against Collector’s auditor, Mr. Hebert. Taxpayer’s complaints against Mr. Hebert

center around the challenge to a sales tax assessment, and allegations regarding pre-

assessment procedures carried out by Mr. Hebert on Collector’s behalf, which

allegedly deprived Taxpayer of a hearing and caused him to pay more in sales taxes

than he lawfully should be made to pay. Specifically, Taxpayer asserts that Mr.

Hebert: (1) made misstatements that a hearing had taken place instead of a

“meeting”; (2) arbitrarily denied a request to continue a re-scheduled hearing; (3)

created the impression that Taxpayer could submit more information relating to the

Assessment that would be considered at a hearing; and (4) ignored evidence

submitted by Taxpayer and caused the Assessment to be wrongfully issued.

C. The provisions of Subsection B of this Section are not applicable:

(1) To acts or omissions which are not reasonably related to the
legitimate governmental objective for which the policymaking or
discretionary power exists; or

(2) To acts or omissions which constitute criminal, fraudulent,
malicious, intentional, willful, outrageous, reckless, or flagrant
misconduct.

D. The legislature finds and states that the purpose of this Section is not to
reestablish any immunity based on the status of sovereignty but rather to clarify
the substantive content and parameters of application of such legislatively
created codal articles and laws and also to assist in the implementation of
Article II of the Constitution of Louisiana.

9
Collector argues that where, as here, Appellees are political subdivisions and

employees thereof, they are exempt from liability for any negligence, if it is a duty

owed to the general public as opposed to a duty owed to an individual plaintiff. See

Dufrene v. Guarino, 343 So.2d 1097 (La.App. 4 Cir.), writ denied, 343 So.2d 1069

(La.1977). Collector asserts that it, through its employee, Mr. Hebert, was

performing a discretionary act—determining when, where, and in what format to hold

an administrative hearing—as contemplated by La. R.S. 9:2798.1. Collector

contends that Mr. Hebert’s holding of the hearing and determination of the tax due

after consideration of Taxpayer’s protest is a duty owed to the general public that

falls within the Collector’s discretion. Collector maintains that specifically, La.R.S.

47:337.50(B) provides, in pertinent part:

At the expiration of thirty calendar days from the date of the
collector’s notice provided in R.S. 47:337.48(B), or at the expiration of
such time as may be necessary for the collector to consider any protest
filed to such notice, the collector shall proceed to assess the tax, penalty,
and interest that he determines to be due under the provisions of the
local ordinance and this Chapter.

We find that Taxpayer’s counsel participated in the hearing with Collector,

including the submission of arguments and documents purporting to support those

arguments, and that Mr. Hebert heard those arguments and reviewed those documents

prior to making a determination of the tax to be due, and issuing the Assessment. To

state a cause of action that overcomes discretionary immunity under La.R.S. 9:2798.1,

a Taxpayer must allege facts sufficient to show a causal link between the alleged

misconduct and the damages suffered. See Cochran v. Caruso, 15-413 (La.App. 5

Cir. 12/3/15), 182 So.3d 1173. Here, Taxpayer was afforded a fair hearing within

the meaning of the ULSTC and the pre-assessment procedure was correct. As such,

the record suggests that there is no factual basis to be found in Taxpayer’s allegations

against Mr. Hebert sufficient to trigger the exception to immunity found in La.R.S.

10
9:2798.1. Accordingly, we find no error in the trial court’s ruling that Taxpayer’s

Petition failed to state facts supporting an exception to the qualified immunity

provisions of La.R.S. 9:2798.1.

ASSIGNMENT OF ERROR NUMBER THREE:

Taxpayer’s third assignment of error is that the trial court erred in applying the

incorrect legal standards to the exception of no cause of action. Our finding in

assignment of error number one, that Taxpayer failed to timely act to properly appeal

or protest Collector’s Assessment in any of the manners specifically enumerated by

law, and in assignment of error number two, that Taxpayer’s Petition failed to state

facts supporting an exception to the qualified immunity provisions of La.R.S.

9:2798.1, pretermits a finding in this assignment of error.

ASSIGNMENT OF ERROR NUMBER FOUR:

Taxpayer’s fourth assignment of error is that the trial court erred by failing to

grant Plaintiff leave to file an amended petition.

“Amendment of pleadings should be liberally allowed, provided that the

movant is acting in good faith, amendment is not sought as delaying tactic, opponent

will not be unduly prejudiced, and the trial of issues will not be unduly delayed.”

Kold, Inc. v. H&A Gas Purchasing, Inc., 609 So.2d 328, 329-30 (La.App. 3 Cir.

1992). “[L]eave to amend should always be given ‘[i]n the absence of futility of . . .

amendment.’” Farmers–Merchants Bank & Trust Co. v. St. Katherine Ins., 93–552

(La.App. 3 Cir. 3/9/94), 640 So.2d 353, 356, writ denied, 94-841 (La. 5/13/94), 641

So.2d 204. The record reflects that based upon representations and arguments of

Taxpayer, the trial court found no possible way for Taxpayer to cure any pleading

defects given Taxpayer’s admission that he did not respond to the Assessment within

thirty calendar days to protest or appeal the Assessment in any of the manners

specifically enumerated by law. Further, Taxpayer failed to state facts supporting
11
an exception to the qualified immunity provisions of La.R.S. 9:2798.1. Accordingly,

we find no error in the trial court’s ruling on this issue.

CONCLUSION:

Taxpayer, Herbert Bliss, asserts four assignments of error as to why the trial

court erred in granting Collector, Lafayette Parish School Board’s, Exceptions and

dismissing Taxpayer’s declaratory judgment suit with prejudice. Finding no merit

to Mr. Bliss’ first assignment of error, that the trial court erred in finding Taxpayer

failed to state a cause of action for declaratory judgment because Taxpayer did not

allege that he paid assessed taxes in protest before filing a declaratory judgment on

the validity of the assessment itself, we affirm the trial court’s ruling on this issue.

Finding no merit to Mr. Bliss’ second assignment of error, that the trial court erred

in finding that the petition failed to state facts supporting an exception to the

qualified immunity provisions of La.R.S. 9:2798.1, we affirm the trial court’s ruling

on this issue. Our findings in assignment of errors number one and two pretermits a

finding in assignment of error number three. Finding no merit to Mr. Bliss’ fourth

assignment of error, that the trial court erred by failing to grant Plaintiff leave to file

an amended petition, we affirm the trial court’s ruling on this issue.

Cost of these proceedings are assessed to Taxpayer, Herbert G. Bliss.

AFFIRMED.

12

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/11294076. Public record. Not legal advice.