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Volume 2 - Opinions of Counsel SBEA No. 12

Opinions of Counsel index

Taxes (cancellation) (refund) - Real Property Tax Law, § 556(3); Suffolk County Tax Act, § 30:

Neither the Suffolk County Tax Act nor the Real Property Tax Law authorize the cancellation of a tax unless such tax has been paid under protest. If payment is made under protest and an application for cancellation is filed with the county, then the county legislature may cancel the tax and refund the payment to the property owner. An alternative method of cancellation is by means of a collateral action at law pursuant to the Civil Practice Law and Rules or the Real Property Actions and Proceedings Law.

Our opinion has been requested as to whether 1971-72 taxes can be cancelled on property acquired by a church in December, 1970 which is currently and has always been used by the church as a parsonage.

Real property owned by a religious corporation and used as a residence by the officiating clergyman is exempt from taxation pursuant to section 462 of the Real Property Tax Law. Taxable status date in the town in which the property is located is June 1, and, therefore, the parcel in question was exempt from taxation on the assessment roll prepared in 1971. Any assessment of the parsonage as taxable real property in 1971 or thereafter (assuming the use as a parsonage continues) may be classified as illegal and, therefore, void.

          Certain types of errors are correctible by the assessors or by the county board of supervisors at specified times and in the manner set forth in Title 3 of Article 5 of the Real Property Tax Law. Pursuant to section 556(3) of such law an illegal assessment and tax may be cancelled and the tax refunded by the board of supervisors after the tax has been paid (Matter of Buffalo Mutual Gaslight Company, 144 N.Y. 228, 39 N.E. 86). This is the sole method available to correct an illegal assessment under the Real Property Tax Law when the owner of the property has failed to file a complaint at grievance day.

Section 30 of the Suffolk County Tax Act authorizes the county board of supervisors to accept a payment which is less than the full amount due in cases in which it is shown by the assessors that “such tax or assessment by reason of overvaluation, double assessment, erroneous area or other error, which has not been otherwise corrected without fault of the person or corporation assessed, is erroneously or illegally assessed or levied or is in fact unjust or inequitable.” This section appears to be limited to situations in which there is a dispute as to valuation or a duplicate assessment and in which a compromise of such dispute is the equitable and practical resolution. The section, which we believe is the exclusive correction remedy within the Suffolk County Tax Act, does not appear to authorize outright cancellation of a void tax. Absent any provision in the Real Property Tax Law or the County Act, there is no procedure for cancellation by the assessors or by the county board.

However, where the actions of the assessors are illegal and void because of lack of jurisdiction, a collateral action will lie, either for a refund of taxes as money had and received (Matter of New York Catholic Protectory, 77 N.Y. 342), or for cancellation of the tax lien as a cloud on title (where taxes have not been paid) (Van Voorhis v. Monroe County, 262 App. Div. 950, 29 N.Y.S.2d 418, aff’d 288 N.Y. 138, 42 N.E.2d 6). This, of course, requires the commencement of an independent legal proceeding.

January 13, 1972

NOTE:  Construes law prior to L.1974, c.177.