Joseph DiCato v. Commissioner of Revenue (January 17, 2007)

COMMONWEALTH OF MASSACHUSETTS

APPELLATE TAX BOARD


JOSEPH DICATO    	        v.	 COMMISSIONER OF REVENUE
	   
Docket No. C282731				 Promulgated:
							 January 17, 2007


This is an appeal under the formal procedure pursuant to G.L. c. 58A, § 7 and G.L. c. 62C, § 39(c) from the refusal of the appellee to grant an abatement of personal income taxes assessed against Joseph DiCato ("appellant") for the period beginning with the tax year ended December 31, 2001, through and including the tax year ended December 31, 2004 ("tax years at issue").     
Commissioner Rose heard the appellee's Motion to Dismiss and was joined in the decision for the appellee by Commissioners Scharaffa, Gorton, and Egan.    
These findings of fact and report are made at the request of the appellant pursuant to G.L. c. 58A, § 13 and 831 CMR 1.32.

Timothy J. Burke, Esq. and Melissa L. Halbig, Esq. for the appellant.

Andrew M. Zaikis, Esq. for the appellee.




FINDINGS OF FACT AND REPORT
On the basis of pleadings and attached affidavits and exhibits offered at the hearing of a Motion to Dismiss filed by the Commissioner of Revenue ("Commissioner"), the Appellate Tax Board ("Board") made the following findings of fact.
The appellant, a resident of Massachusetts, filed a personal income tax return for each of the tax years at issue.  In October of 2003, the Department of Revenue ("DOR") notified the appellant by letter that it was conducting an audit of his personal income tax returns.  According to an affidavit of appellant's attorney, Timothy Burke, Attorney Burke provided the DOR, on October 25, 2003, with a power of attorney form signed by the appellant naming Attorney Burke as his attorney in connection with the audit.  Attorney Burke also stated in this affidavit that he had received communications from the DOR subsequent to the filing of the power of attorney, including a Notice of Intention to Assess, issued on February 18, 2004, and a copy of the notice changing the proposed assessment for tax year 2003. 
According to his affidavit, Attorney Burke communicated with the DOR on several occasions during the next few months and attended two conferences at the DOR.  The Commissioner issued to the appellant a Notice of Assessment on May 18, 2004.  On October 27, 2004, the appellant filed abatement applications with the Commissioner.  The abatement applications were not submitted into evidence, but according to Attorney Burke's affidavit, they were filed by the appellant, and there is no evidence indicating that Attorney Burke was involved in the filing of these abatement applications.  On July 25, 2005, the Commissioner issued to the appellant two denials of the appellant's abatement applications, the first denial covering tax years 2001, 2002, and 2004, and the second denial covering tax year 2003.  The DOR did not send copies of the denials to Attorney Burke.  
In October 2005, DOR's Collections Bureau began making collection efforts against the appellant for the unpaid assessment of personal income taxes.  According to an affidavit submitted by the Commissioner from Larry Russett, a Tax Examiner with the Collections Bureau, and Attorney Burke's affidavit, Attorney Burke contacted Mr. Russett on either November 3, 2005 or November 14, 2005, complaining that he had never received any notice that the appellant's abatement applications had been denied.  Mr. Russett had sent the collection notices and demands to the appellant at his address in Everett, and "[t]hose notices and demands would have contained my name and phone number and this would probably explain why Attorney Burke was calling me."    
According to his affidavit, Mr. Russett informed Attorney Burke that no power of attorney for the appellant was on file with the DOR, but he did confirm to Attorney  Burke that the applications had been denied.  Mr. Russett offered to mail a copy of the denial to Attorney Burke if Attorney Burke sent him a copy of the power of attorney.  The affidavit then states that Mr. Russett received the copy of the power of attorney on November 14, 2005, and that he noticed that Attorney Burke "had not checked the box that requested that copies of all notices to the taxpayer also be sent to him."  The appellant did not dispute this allegation.  Moreover, DOR's Form M-2848 Power of Attorney and Declaration of Representative clearly states that "[o]riginals of notices and other written communications go to the taxpayer(s)."  Mr. Russett subsequently mailed Attorney Burke a copy of the denial.  The envelope containing the copy of the original denial notice reveals a postmark date of December 8, 2005.
The Commissioner also submitted an affidavit by Robert O'Neill, Chief of the Customer Service Bureau of the Department.  Mr. O'Neill explained that at all material times, the DOR's regular course of business was to enter a denial of an abatement application into DOR's computerized MASSTAX system, and then the MASSTAX system would generate a denial letter to the taxpayer as part of "an automated process."  The DOR would then mail these notices through the Commonwealth's Information Technology Division on the date that the notice was generated.  Any generated notice would be sent by first-class mail to the taxpayer at the address listed on the notice.  The notice sent to the appellant lists the appellant's address correctly.  According to Mr. O'Neill's affidavit, "[t]here is no indication or note in the MASSTAX system indicating that this notice was ever returned to the [DOR] for incorrect or insufficient address."  
The appellant filed a complaint in Suffolk County Superior Court on January 3, 2006 challenging the disputed assessment.  He filed his petition with the Board on January 12, 2006, raising essentially the same grounds as raised in the complaint in Suffolk County Superior Court.
The Board found that the Commissioner's regular course of business at all relevant times was that notices of abatement denial were mailed to applicants on the date of the notice.  The Board further found that the notice of denial in the present appeal was properly addressed to the appellant and that the notice was mailed to the appellant pursuant to the Commissioner's regular course of business.  Finally, the Board finds no indication that the notice was ever returned to the DOR as undeliverable.  
To prove he never received the notice, the appellant offered only an unsupported, self-serving affidavit in which he claimed to have "reviewed all of my records to the best of my ability" and he "d[id] not have any record of receiving a Notice of Abatement Determination."  
On the basis of the foregoing, the Board found and ruled that the appellant failed to meet his burden of establishing that he did not receive the notice of denial and further ruled that the due date for filing his appeal with the Board had expired on September 23, 2005, long before the January 12, 2006 date of appellant's filing of this appeal.
The Board further finds that under the circumstances of this appeal, Attorney Burke was not entitled to notice of the Commissioner's decision on the abatement application.  First, there is no evidence that Attorney Burke's name appears on the abatement application, which, according to Attorney Burke's affidavit, was filed by the appellant himself.  Further, the power of attorney authorized Attorney Burke to represent the appellant at the DOR but not to receive notices from the DOR.  
On the basis of the foregoing, and for the reasons stated in the following Opinion, the Board ruled that the Board lacked jurisdiction over the instant appeal.  Accordingly, the Board issued a decision for the appellee. 

OPINION
Appeals to the Board from the Commissioner's denials of applications for abatement are governed by G.L. c. 62C, § 39, which provides in pertinent part:
Any person aggrieved by the refusal of the commissioner to abate a tax, in whole or in part, may appeal therefrom, within sixty days after the date of notice of the decision of the commissioner . . .

The date of notice of the Commissioner's decision was July 25, 2005; sixty days from that date was September 23, 2005.  The petition, filed on January 12, 2006, was thus filed more than three months after the expiration of the § 39 appeal period.  "Since the remedy by abatement is created by statute, the [board] has no jurisdiction to entertain proceedings for relief by abatement begun at a later time or prosecuted in a different manner than is prescribed by the statute."  Commissioner of Revenue v. A.W. Chesterton Co., 406 Mass. 466, 467-68 (1990) (quoting Assessors of Boston v. Suffolk Law School, 295 Mass. 489, 492 (1936)).  "The Board has consistently held that it has no jurisdiction to consider an appeal filed later than prescribed by statute."  Watjus Electric, Inc. v. Commissioner of Revenue, ATB Findings of Fact and Reports 1993-139, 142 (citing Perry v. Commissioner of Revenue, ATB Findings of Fact and Reports 1990-262, 263-64).  Neither the courts nor the Board has the authority to create an exception to the time limit prescribed by G.L. c. 62C,     § 39.  Sears Roebuck & Co. v. State Tax Comm'n, 370 Mass. 127, 130 (1976).
Pursuant to G.L. c. 62C, § 71, a notice of denial may be mailed to the taxpayer "addressed to such person at his address as it appears in the records of the Commissioner."  In this appeal, the Commissioner's computerized records and business practice establish that a notice of denial was generated and mailed to the appellant at the same address which was provided on his petition to the Board.  There is no evidence that this address was not the correct address during the time that the notice was mailed, nor that the notice was returned as undeliverable.  Where, as here, the Commissioner complied with the statutory requirements related to mailing a notice of denial, the burden of proving that a notice was not received lies with the appellant.  SCA Disposal Serv's v. State Tax Comm'n, 375 Mass. 338, 341-42 (1977)("[P]roof that the statutory requirements as to mailing have been met places on the taxpayer the burden of proving that the notice was never received."). 
In the instant appeal, no evidence was offered that the appellant himself did not receive the notice beyond the appellant's bare assertion of non-receipt, contained in a self-serving affidavit carefully couched in such phrases as "I do not have any record."  The Board has previously rejected a similar attempt by a taxpayer to establish non-receipt of a notice.  In Morrill Equipment Sales v. Comm'r of Revenue, ATB Findings of Fact and Reports 1996-181, the appellants submitted an affidavit in which they claimed that they did not receive a notice of denial until over eighteen months after the DOR actually issued its denial.  They claimed they had had numerous conversations and correspondences with DOR employees since the denial, and that none of them mentioned the denial; however, the appellants "provided no details of any conversations, no names of people spoken to, no dates of the alleged conversations nor any copies of the alleged correspondence."  Id. at 183.  Moreover, the appellants never produced the original notice of denial, which they claimed contained a date stamp that was not legible.  Id.  The Board "[wa]s not persuaded by Mr. Morrill's bare assertions of fact and [found] that the appellants' petition was filed more than eighteen months beyond the sixty-day period allowed under G.L. c. 62C, § 39.  See also Watjus Electric, Inc. v. Commissioner of Revenue, ATB Findings of Fact and Reports 1993-139, 143 (Because the appellant submitted no documentary evidence supporting its claim of when the DOR mailed the notice of denial, "the board rule[d] that the appellant ha[d] not sustained its burden of proof of demonstrating that the notice of denial was mailed and received excessively late  . . . so as to justify taking additional time to file its appeal."). 
The appellant focuses much of his argument on the failure of the Commissioner to send notice of the denial to his counsel.  However, the appellant offers no legal basis for his claim that his counsel was entitled to notice.  The abatement application, which the Commissioner denied by the disputed notice, was not submitted into evidence, but according to Attorney Burke's affidavit, the appellant filed the abatement application, and there is no evidence that Attorney Burke was involved in its preparation.
Further, the power of attorney did not authorize Attorney Burke to receive notices or other communications from the Commissioner.  There is simply nothing to support a finding that the Commissioner was under an obligation to send notice of the denial to Attorney Burke or that the appellant's time for appealing the denial was somehow expanded because his lawyer received no timely notice of the denial.  
It may well be that the appellant and Attorney Burke each thought the other was handling the filing of the appeal.  However, any miscommunication or misunderstanding between the appellant and his counsel does not serve to extend the deadline for filing an appeal with the Board.  See Peterson v. Commissioner of Revenue, ATB Findings of Fact and Reports 1994-305 (Board found that, even though appellant's attorney had received copies of correspondence from the DOR pursuant to a power of attorney, the appellant was ultimately responsible for timely filing of the appeal with the Board). 
On the basis of the foregoing, the Board ruled that the appellant failed to prove that he did not receive the July 25, 2005 denials and he did not otherwise establish that the sixty-day deadline for filing his appeal should be
extended beyond September 23, 2006.  Accordingly, the Board ruled that it had no jurisdiction over this appeal and issued a decision for the appellee. 

					THE APPELLATE TAX BOARD



By:____________________________________
    Thomas W. Hammond, Jr., Chairman




A true copy,


Attest:_____________________________
  	     Assistant Clerk of the Board 

 Mr. Russet's affidavit states that his conversation with Attorney Burke occurred on November 3, while Attorney Burke claims that the conversation occurred on November 14. 

ATB 2007-47