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Volume 9 - Opinions of Counsel SBEA No. 87

Opinions of Counsel index

Assessments, generally (selective reassessment) (personal liability of assessor) - Real Property Tax Law, § 305; 42 U.S.C. § 1983:

An assessor who engages in the process of selective reassessment is acting contrary to law. Such illegal activity may also violate the civil rights of taxpayers. Under certain circumstances, if an assessor has been found to have violated a taxpayer’s civil rights, the assessor may be held personally liable for compensatory and punitive damages.

We have been asked for our comments as to the effect on assessors of recent court decisions affecting inequitable assessments and violations of civil rights.

Assessors who reassess property selectively may be faced with an additional problem beyond reduced assessments and refunds on unfairly assessed property. The practice of reassessing properties only upon sale has been held unconstitutional (Allegheny Pittsburgh Coal Co. v. County Commission of Webster County, West Virginia, 488 U.S. 336, 109 S.Ct. 633, 102 L.Ed.2d 688 (1989); Krugman v. Board of Assessors of Village of Atlantic Beach, 141 A.D.2d 175, 533 N.Y.S.2d 495 (2d Dept. 1988); see also, 9 Op.Counsel SBEA No. 18). The constitutional objective may be mitigated if a state specifically adopts such a system of assessment (see, Nordlinger v. Hahn, __ U.S. __, 112 S.Ct. 2326, 120 L.Ed.2d 1 (1992), upholding California’s Proposition 13), but New York State has not done so.

Thus, taxpayers may allege that by engaging in the practice of selective reassessment, assessors have deprived them of their rights secured by the United States Constitution. In addition to the remedies available under State law, {*} the owner of a property that has been selectively reassessed may seek compensatory and punitive damages against the assessors personally pursuant to section 1983 of Title 42 of the United States Code. That section, which shall be referred to for the remainder of this Opinion as “section 1983,” states:

Every person who, under color of any statute . . . of any State . . . subjects, or causes to be subjected, any citizen of the United States . . . to the deprivation of any rights, privileges or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.

Lawsuits may be brought under this statute against local government officials acting in their official capacities (Monell v. Dept. of Social Services, 436 U.S. 658, 98 S.Ct. 2018, 56 L.Ed.2d 611 (1978)), including assessment officials (see, e.g., Matter of Xerox Corp. v. Town of Webster, N.O.R., (Sup. Ct., Monroe Co., 1993), aff’d, 204 A.D.2d 990,612 N.Y.S.2d 734 (4th Dept. 1994)).

Although a section 1983 action may be brought in either Federal or state court, it is very difficult to reach Federal court with respect to state tax matters. In Rosewell v. LaSalle National Bank, 450 U.S. 503, 101 S.Ct. 1221, 67 L.Ed.2d 464 (1981), the United States Supreme Court held that the Tax Injunction Act (28 U.S.C. § 1341) requires that Federal courts “not enjoin, suspend or restrain the assessment, levy or collection of any tax under State Law, where a plain, speedy and efficient remedy may be had in the courts of such State.” The Court found that the State remedy imposed no unusual hardship on the taxpayer requiring ineffectual activity or an unnecessary expenditure of time or energy.

In Fair Assessment in Real Estate Ass’n v. McNary, 454 U.S. 100, 102 S.Ct. 177, 70 L.Ed.2d 271 (1981), the United States Supreme Court again addressed the issue of a possible Federal court action by a taxpayer based upon section 1983. The Court ruled that a determination that a state taxpayer may recover damages under civil rights provisions because of unconstitutional administration of a state tax system would be fully as intrusive upon state administration of tax laws as equitable actions which are barred by principles of comity. The Court held that state taxpayers alleging unconstitutional administration of a state tax system “must seek protection of their Federal rights by state remedies, provided of course that those remedies are plain, adequate and complete and may ultimately seek review of state decisions in the United States Supreme Court.” Therefore, it appears that taxpayers bringing a section 1983 action may find it very difficult to reach Federal court.

This difficulty would not apply to section 1983 actions brought in State court. In 423 South Salina Street, Inc. v. City of Syracuse, 68 N.Y.2d 474, 503 N.E.2d 63, 510 N.Y.S.2d 507 (1986), cert. denied, 481 U.S. 1008, 107 S.Ct. 1880, 95 L.Ed.2d 488 (1987), the Court of Appeals found that a taxpayer had standing to maintain a section 1983 action for damages resulting from the City’s alleged misuse of its taxing power, even if the taxpayer had not pursued the remedies available under State law. The Court did, however, dismiss the action due to the property owner’s failure to file a notice-of-claim as required by the General Municipal Law.

More recently, the United States Supreme Court addressed the issue of the applicability of a state notice-of-claim requirement with respect to a section 1983 action. In Felder v. Casey, 487 U.S. 131, 108 S.Ct. 2302, 101 L.Ed.2d 123 (1988), the Supreme Court concluded that in a Federal civil rights action brought against a municipality in state court under section 1983, a state notice-of-claim requirement is preempted as inconsistent with Federal law. This decision, then, increases the importance of the Salina Street decision; a civil rights suit may be pursued in the New York State courts by a taxpayer without need of filing a notice-of-claim.

In conclusion, assessors who continue the practice of selective reassessment should be concerned with possible taxpayer actions in State court under section 1983, which may result in the award of compensatory and punitive damages against them personally.

August 18, 1989
Revised May 1993

{*}  In addition to seeking an assessment reduction pursuant to Article 7 of the RPTL, section 722(2) of the RPTL allows taxpayers to recover up to $2,500 where the court finds that an assessment was increased after a court order “without adequate cause” or was “grossly discriminatory.” Such an award was granted in W.T. Grant Company v. Srogi, 52 N.Y.2d 496, 420 N.E.2d 953, 438 N.Y.S.2d 761 (1981).