ILNews

COA rules paying penalty doesn't nullify appeal

Back to TopCommentsE-mailPrintBookmark and Share

The Indiana Court of Appeals has ruled on an issue that has not directly been addressed by statute or caselaw, holding that paying a civil penalty to stop a tax sale of property doesn’t cancel out an appeal questioning that assessment’s validity.

A ruling came Tuesday in Gordon B. Dempsey v. Department of Metropolitan Development of City of Indianapolis, No. 49A02-1102-MI-165, reversing a judgment from Marion Superior Judge Robyn Moberly and Judge Pro Tempore Kim Mattingly.

The case involves a property on Berwick Avenue in Indianapolis. The owner died in 2004, and another person bought the property at a tax sale that same year but did not record a tax deed. The property remained vacant and, in May 2008, the Health and Hospital Corporation determined the building maintenance hadn’t been kept up in compliance with the city’s vacant building standards. Dempsey bought the property in June 2008 and made a down payment, and an inspector that summer visited the site and saw Dempsey doing work on the house.

An administrative hearing on the violations to the Vacant Building Standards and Unsafe Building Laws was held, and despite the inspector being present to testify about the work he saw Dempsey doing, the administrative law judge imposed a civil penalty of $2,500 against Dempsey, who was not present. Dempsey appeared at later hearings to demonstrate work was being done, and he was fined another $2,500. The ALJ waived the original fine at a subsequent hearing in June 2009 and reduced the second penalty to $1,500. That’s the assessment that remained in place and was certified as “final.”

Dempsey appealed the ALJ’s civil penalty to the Marion Superior Court, but the city department didn’t receive notice of that appeal and it certified the allegedly delinquent penalty to the county auditor and tacked the $1,500 penalty on to Dempsey’s fall 2009 tax bill as a special assessment. In October 2009, Dempsey paid the $1,500 civil penalty and additional fees despite the ongoing trial court appeal of the fine itself, and as a result the trial court in December 2010 granted a motion from the city to dismiss the appeal because it was moot.

On appeal, both parties disagree about whether Dempsey’s payment of that civil penalty to prevent a delinquent tax sale cancelled out the appeal he filed earlier that year disputing the fine itself.

The Court of Appeals found no statute or reported case directly on point, but relied on provisions of Indiana Code 6-1.1-15-10(a) applying to tax appeals, which says that taxpayers must pay their taxes on tangible property when the tax installments come due even if a petition for review or judicial review proceeding is pending.

“That said, it is apparent that the concept of mootness runs afoul of the circumstances here that involve the payment of the penalty that was imposed under the housing code that enabled Dempsey to avoid the sale of the property at a tax sale,” Judge John Baker wrote. “And there is no case, statute, or rule suggesting that Dempsey’s payment of the tax bill, which includes the penalty that was assessed under the building code, renders the appeal moot. Therefore, we reject the DMD’s assertion that Dempsey’s payment of the penalty ‘on his own volition’ removed the controversy by paying the civil penalty.”

The case is remanded to Marion Superior, with instructions to reinstate Dempsey’s appeal, decide the case on its merits, and determine whether the penalty was warranted. But the appellate court declined to allow for any attorney fees and costs to Dempsey because he doesn’t show the city department made arguments that were frivolous, unreasonable, groundless, or in bad faith.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. I have had an ongoing custody case for 6 yrs. I should have been the sole legal custodial parent but was a victim of a vindictive ex and the system biasedly supported him. He is an alcoholic and doesn't even have a license for two yrs now after his 2nd DUI. Fast frwd 6 yrs later my kids are suffering poor nutritional health, psychological issues, failing in school, have NO MD and the GAL could care less, DCS doesn't care. The child isn't getting his ADHD med he needs and will not succeed in life living this way. NO one will HELP our family.I tried for over 6 yrs. The judge called me an idiot for not knowing how to enter evidence and the last hearing was 8 mths ago. That in itself is unjust! The kids want to be with their Mother! They are being alienated from her and fed lies by their Father! I was hit in a car accident 3 yrs ago and am declared handicapped myself. Poor poor way to treat the indigent in Indiana!

  2. The Indiana DOE released the 2015-2016 school grades in Dec 2016 and my local elementary school is a "C" grade school. Look at the MCCSC boundary maps and how all of the most affluent neighborhoods have the best performance. It is no surprise that obtaining residency in the "A" school boundaries cost 1.5 to 3 times as much. As a parent I should have more options than my "C" school without needing to pay the premium to live in the affluent parts of town. If the charter were authorized by a non-religious school the plaintiffs would still be against it because it would still be taking per-pupil money from them. They are hiding behind the guise of religion as a basis for their argument when this is clearly all about money and nothing else.

  3. This is a horrible headline. The article is about challenging the ability of Grace College to serve as an authorizer. 7 Oaks is not a religiously affiliated school

  4. Congratulations to Judge Carmichael for making it to the final three! She is an outstanding Judge and the people of Indiana will benefit tremendously if/when she is chosen.

  5. The headline change to from "religious" to "religious-affiliated" is still inaccurate and terribly misleading.

ADVERTISEMENT