Justia Maryland Court of Appeals Opinion Summaries

Articles Posted in Tax Law
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In these actions brought by tax sale buyers for declaratory and injunctive relief alleging that Maryland sheriffs exceeded their express and implied authority by adopting policies concerning how to execute writs of possession in tax sale foreclosure cases the Court of Appeals held that the sheriffs had the implied authority to adopt policies for how to serve writs of possession in such cases.This case involved a challenge to two policies used by sheriffs in evicting people from their homes when a tax sale buyer obtains a judgment foreclosing the right of reception with respect to a property and the homeowner does not redeem the property. Under the "mover policy," sheriffs require tax sale buyers to provide movers to remove personal property from the premises when serving writs of possession. Under the "weather policy," sheriffs postpone the service of writs of possession during bad whether conditions. The Supreme Court affirmed the lower courts' judgments in favor of the sheriffs, holding that, in the execution of writs of possession, both the mover policy and the weather policy constituted a valid exercise of powers daily implied by the sheriffs' expressly given duties and authority. View "Thornton Mellon LLC v. Frederick County Sheriff" on Justia Law

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The Court of Appeals held that a determination of whether to order reimbursement of attorney's fees under Md. Code Ann., Tax-Property (TP) 14-843(a)(4)(i) after a complaint has been filed is discretionary and that a circuit court may consider whether the tax sale certificate holder (TSCH) impeded the property owner's exercise of the right of redemption in making a determination as to reimbursement.After a tax sale at which the TSCH purchased property, the TSCH billed the owner for attorney's fees and expenses for a complaint that had not yet been filed and did not promptly notify the owner that an expired release could be used to redeem the property. The owner reimbursed the TSCH for the attorney's fees owed at the time, but before the redemption process was completed the TSCH filed a complaint to foreclose the owner's right of redemption. The owner later paid all amounts necessary to redeem the property. At issue was whether the owner was required to reimburse the TSCH for attorney's fees incurred after the complaint was filed. The Court of Appeals held that the circuit court did not abuse its discretion in declining to order reimbursement of the TSCH's attorney's fees under TP 14-843(a)(4)(i) or in declining reimbursement of attorney's fees in exceptional circumstances under TP 14-843(a)(4)(iii). View "Thornton Mellon LLC v. Adrianne Dennis Exempt Trust" on Justia Law

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The Court of Appeals reversed the judgment of the tax court reversing the decision of the Comptroller of Maryland denying Broadway Services Inc.'s request for an offset and refund of the taxes it paid to cleaning supply vendors, holding that the tax court erred.Under contracts between three non-profit tax-exempt hospitals of the Johns Hopkins Health System and Broadway, a for-profit business, Broadway provided management services to the hospitals, including purchasing and providing cleaning supplies for the use of he hospitals' janitorial staff. Broadway filed a request for an offset and refund of the taxes it paid to cleaning supply vendors, asserting that Broadway was tax exempt because it was reselling the cleaning supplies. The Comptroller denied the refund. The tax court reversed, concluding that because Broadway acted as the hospitals' agent it should not have been charged sales tax. The Court of Appeals reversed, holding that the tax court erroneously conducted its agency analysis as a matter of law. View "Broadway Services v. Comptroller" on Justia Law

Posted in: Tax Law
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In this dispute between a municipality seeking tax setoffs and a county that refused to grant them, the Court of Appeals affirmed the conclusion of the court of special appeals that Md. Code Tax-Prop. ** 6-305 and 6-306 do not fall within a category of constitutionally prohibited legislation, holding that the provisions are permissible within the scope of article XI-E, 1 of the Maryland Constitution.Ocean City, the second largest municipality in Worcester County, repeatedly requested tax setoffs for the money that the city spent on governmental services, such as fire, police, and ambulance services. In lieu of granting Ocean City's requested tax setoffs, Worcester County provided discretionary funding to the city in the form of annual grants. Ocean City then filed this action seeking a declaratory judgment that TP 6-305 and 6-305, which granted the county the ability to deny municipal tax setoff requests, were unconstitutional as violating Md. Const. Art. XI-E, 1. The circuit court granted summary judgment in favor of Worcester County. The court of special appeals affirmed. The Court of Appeals affirmed, holding that TP 6-305 and 6-306 are constitutional within the language of Article XI-E, Section 1. View "Ocean City v. Worcester County" on Justia Law

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The Court of Appeals affirmed the decision of the tax court determining that, between 2003 and 2011, Travelocity.com LP was liable for sums due under the sales and use tax pursuant to Md. Code Tax-Gen. 11-102(a), holding that Travelocity was not liable to pay the sales and use tax during the relevant audit period.The Comptroller of Maryland issued a tax assessment of almost $6.5 million. The tax court upheld the assessment, concluding that Travelocity's business of facilitating vehicle rentals and hotel room reservations was included in the sale of tangible personal property in Maryland, rendering Travelocity liable for the tax during the audit period at issue. The circuit court affirmed. The court of special appeals reversed. The court of appeals reversed, holding that Travelocity was not liable for the tax during the audit period at issue. View "Travelocity.com v. Comptroller" on Justia Law

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The Court of Appeals affirmed the denial of Clear Channel Outdoor, Inc.'s request for a refund of the taxes that it paid pursuant to a Baltimore City ordinance for the privilege of selling advertising on billboards that are not located on the premises where the goods or services being advertised were offered or sold, holding that the ordinance is constitutional.Clear Channel, which was in the business of selling advertising on its billboards in Baltimore City, sought a refund from the City Director of Finances of the taxes it paid pursuant to the city ordinance at issue. Clear Channel claimed that the ordinance was unconstitutional under the First and Fourteenth Amendments and Article 40 of the Maryland Declaration of Rights. The City denied a refund, and the Maryland Tax Court affirmed. The circuit court and court of appeals affirmed. The Supreme Court affirmed, holding that the ordinance survives the application of a rational basis test and, accordingly, is constitutional. View "Clear Channel Outdoor, Inc. v. Department of Finance of Baltimore City" on Justia Law

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The Court of Appeals affirmed the decision of the circuit court holding that the General Assembly's amendment of the Maryland tax code authorizing the State Comptroller to pay refunds to taxpayers affected by a provision held to be invalid and providing for the State to pay interest on those refunds at a certain rate did not violate the dormant Commerce Clause of the federal Constitution.This litigation arose when Appellants challenged the credit allowed by State law against a Maryland resident's income tax liability based on taxes the resident paid to other states on income derived from those states. The Court of Appeals and the Supreme Court agreed with Appellants' argument that the tax scheme violated the dormant Commerce Clause. In response, the General Assembly amended the tax code. After the Comptroller issued Appellants a refund in compliance with the new legislation, Appellants appealed, seeking a higher rate of interest on the refunds. Following an administrative ruling in Appellants' favor, the circuit court held that the interest rate did not violate the dormant Commerce Clause. The Court of Appeals affirmed, holding that Appellants failed to meet their burden of showing discrimination in effect. View "Wynne v. Comptroller of Maryland" on Justia Law

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Petitioner, the assignee of an entity that paid certain sewer connection charges, sought a refund of the charges, asserting that they were improperly charged by the Town of Bel Air. The Town’s Director of Finance denied Petitioner’s refund application. On appeal, the Tax Court granted the Town’s motion to dismiss, concluding (1) it lacked jurisdiction to consider Petitioner’s refund claim because it did not come within the purview of the refund statute, and (2) even if the sewer connection charges were miscalculated or illegally imposed the common law voluntary payment doctrine precluded Petitioner from obtaining a refund. The Supreme Court reversed, holding (1) Petitioner may pursue its refund claim under the refund statute; (2) Petitioner’s claim is not barred by the voluntary payment doctrine; and (3) the Tax Court has jurisdiction to consider the appeal. View "Brutus 630, LLC v. Town of Bel Air" on Justia Law

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The assessment of real property in the State for property tax purposes is calculated by reference to the value on the “date of finality,” which is defined as “January 1, immediately before the 1st taxable year to which the assessment based on the new value is applicable.” Petitioner appealed her 2011 tax assessment of a condominium she owned and occupied. The Tax Court concluded that the Tax Property Article did not prohibit the court from taking into account sales of comparable properties that occur after the date of finality in determining the value of a property on the date of finality and, thus, relied on sales of comparable properties that occurred several months after the date of finality. The Circuit Court ruled that the Tax Court erred in considering evidence of post-date of finality sales of comparable properties. The Court of Special Appeals reversed. The Court of Appeals affirmed, holding (1) the Tax Court may consider the sale of comparable properties occurring within a reasonable time after the date of finality to assess the value of the property; and (2) substantial evidence in the record supported the Tax Court’s assessment of Petitioner’s property, relying on the post-date of finality sales. View "Lane v. Supervisor of Assessments of Montgomery County" on Justia Law

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Appellees’ farm was condemned by the Board of Education for the purpose of building a school. On Appellees’ behalf, the Board paid the State agricultural land transfer tax and the County farmland transfer tax. Appellees requested from the County a refund of a portion of the County farmland transfer tax, arguing that the County, in calculating the County farmland transfer tax, was incorrect in concluding that the twenty-five percent State surcharge was not part of the combined transfer tax. The County denied the request for a refund. The Tax Court affirmed, concluding that the State surcharge was to be collected in addition to the State agricultural land transfer tax and the County farmland transfer tax. The circuit court reversed. The Court of Special Appeals certified the case to the Court of Appeals to answer a question of law. The Court of Appeals answered (1) the agricultural land transfer tax, as set forth in Md. Code Ann. Tax-Prop. 13-407(a)(2) and (3), includes the State surcharge imposed under Md. Code Ann. Tax-Prop. 13-303(d), and the State surcharge must be calculated into the tax ceiling on a county’s agricultural land transfer tax; and (2) therefore, Appellees were entitled to a refund in the amount of the overcharge of the County farmland transfer tax. View "Montgomery County v. Phillips" on Justia Law