Appellate Division, 3rd Department Case Summaries: October 21, 2008

Daily Record (Rochester, NY), Oct 21, 2008

Appellate Division, 3rd Department

Tax Lien

In the Matter of the County of Sullivan

504532

Appealed from County Court, Sullivan County

Background: The appeal is from an order, in a proceeding pursuant to RPTL article 11, that granted petitioner's motion for summary judgment. From the 1970s onward, a now-defunct shopping plaza was owned by the Sullivan County Industrial Development Agency and was thus exempt from property taxes. It suffered a business decline over the years. In 2001, the respondent, ABC Pacific Realty, LLC, purchased the assignment of a mortgage on the property. Respondent then commenced a mortgage foreclosure proceeding against the IDA. While that was pending, on May 6, 2002, at 9:54 a.m., the IDA transferred title to the property to AP Equity, a taxable entity. At 9:59 a.m. that same day, AP Equity transferred the property to the Unkechaug Indian Nation, another taxable entity. As a result of the transfer from the IDA to AP Equity, the property's tax status changed from exempt to nonexempt and the Assessor for the Town of Thompson was required to reassess the property. Notice was sent only to the Indian Nation. Respondent contends that, when read literally, RPTL 520(2) mandates that AP Equity, as the "new owner" of the property after its change in tax status, was entitled to notice of the reassessment.

Ruling: Under the unusual circumstances here, it was not unreasonable for the assessor to provide notice of the reassessment only to the Unkechaug Indian Nation. Considering that respondent did not remit any tax payments to petitioner in an effort to redeem the property, supreme court did not err in granting petitioner's motion for summary judgment.

Marvin Newberg for the appellant and Cheryl A. McCausland, Assistant County Attorney for the respondent