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Volume 5 - Opinions of Counsel SBEA No. 117

Opinions of Counsel index

Correction of errors (error in essential fact) (erroneous assessment of non-existent improvement to real property) - Real Property Tax Law, §§ 550, 556-a:

The assessment of buildings against lots upon which they were not located is an “error in essential fact” to which section 556-a of the Real Property Tax Law is applicable. Such assessment errors may also be reviewed at the grievance day proceedings, and by the courts pursuant to Article 7 of the Real Property Tax Law. Section 556-a is applicable even when there is an Article 7 proceeding pending. Administrative correction of an “error in essential fact,” which is a partial basis of a pending Article 7 proceeding, would not dispose of a companion charge of overvaluation.

An inquiry has been received regarding the assessment of buildings against lots upon which they were not located. “Error in essential fact” is defined in section 550 of the Real Property Tax Law. Paragraph (b) of subdivision 3 of that section provides that such an error includes “an incorrect entry on the taxable portion of the assessment roll, or the tax roll, or both, of the assessed valuation of an improvement to real property which was not in existence or which was present on a different parcel.” Thus, the erroneous assessment in this case is an “error in essential fact.”

In the event an “error in essential fact” is established, section 556-a of the Real Property Tax Law becomes applicable. That section provides that the appropriate board of assessment review or tax levying body may administratively correct an “error in essential fact.” The error is correctable when it is discovered on the final assessment roll (by the board of assessment review upon the application of the assessor with notice to the taxpayer) or on the tax roll (by the tax levying body upon the recommendation of the county director of real property tax services to whom application is made by the taxpayer). In addition, if the error is discovered within one year from the date of the annexation of the warrant to the tax roll, and the tax was paid, the taxpayer may apply for a refund of that portion of the tax attributable to the “error in essential fact” (§ 556-a(4)(a)).

It must be noted that the administrative correction of errors outlined above in no way precludes the correction of assessment errors at the grievance day proceedings. A taxpayer, who is not satisfied with the decision of the board of assessment review at grievance day, has the right to initiate a subsequent action for judicial review pursuant to Article 7 of the Real Property Tax Law. This is the course which was adopted by the taxpayer in question. This office is unaware of the current status of the taxpayer’s petition. If his case has been decided in his favor, the question posed here is moot. If it has not, however, or if it is pending, the correction of errors law may still be applicable. There would not appear to be any reason for excluding application of section 556-a because a judicial proceeding under Article 7 has been commenced, though such a course would raise a question as to why the error was not corrected at grievance day.

It is also asked “what further legal appeals the taxpayer would have if the values of the improvements were transferred to the proper lots,” presumably by utilization of section 556-a. The taxpayer’s petition in Supreme Court pursuant to Article 7 of the Real Property Tax Law is apparently only partially based on the contention that his assessment included nonexistent improvements. It is also based upon a charge of overvaluation. Administrative correction of the “error in essential fact” would not dispose of this latter claim, and the taxpayer’s legal remedies would remain unimpaired.

February 24, 1977