Property Owner Wins Opportunity to Present Appeal Based Upon Highlands Act Exemption Claim

by: Anthony F. Della Pelle
22 Jan 2010

In this recent opinion from the New Jersey Tax Court, the taxpayer, Princeton Alliance Church (PAC), survived a motion to dismiss its property tax appeal after Tax Court Judge Vito Bianco found that the Morris County Tax Board improperly dismissed its appeal for failing to present a witness at the county tax board hearing.  The undisputed facts of Princeton Alliance Church v. Mount Olive Township showed that PAC filed a brief with its appeal alleging that a portion of its property should be exempt as “taken by the State for conservation purposes” because it was located within the Highlands Preservation Area.  The Morris County Tax Board dismissed the matter for lack of prosecution after PAC’s attorney advised that he was not presenting witnesses, and would instead address only legal arguments raised in its appeal.

Judge Bianco denied Mount Olive’s motion to dismiss as being contrary to statutory and case law.  As was recognized in VSH Realty, Inc. v. Harding Twp., 291 N.J. Super. 295 (App. Div. 1996), dismissal for lack of prosecution is only appropriate where the taxpayer fails to appear.  The VSH Realty case does not impose a requirement on taxpayers to present witnesses at the county tax board hearings, although the taxpayer does bear the burden of proof to show it complies with the statutory requirements establishing an exemption.  However, the tax boards and parties may instead rely on “competent documentary evidence” to establish whether a taxpayer has submitted sufficient proofs to qualify for the requested exemption.  See Ganifas Trust v. City of Wildwood, 15 N.J. Tax 722, 726 (App. Div. 1996).

Judge Bianco also noted that a tax board has the authority to determine legal questions raised in exemption cases.  He highlighted that this power protects property owners like PAC who would not qualify for a direct appeal to the tax court because it does not meet the jurisdictional dollar limit.  Moreover, because the Tax Board must determine the appropriate level of taxation to determine if PAC’s property is exempt, the Tax Board here has the authority to determine the legal issues raised by PAC.

The full text of the Appellate Division’s opinion can be found here.  This case could present taxpayers with relief in the future in avoiding dismissals with prejudice by county tax boards.

The VSH Realty case, which was relied upon by the Tax Court in the PAC matter, was argued before the tax board and tax court by McKirdy & Riskin’s Anthony Della Pelle .  The author wishes to acknowledge the assistance of Cory Kestner of McKirdy & Riskin in the preparation of this article.