Richard D. Foster v. Indiana Department of State Revenue (mem. dec.)

MEMORANDUM DECISION
Pursuant to Indiana Tax Court Rule 17, this
Memorandum Decision shall not be regarded
as precedent or cited before any court except Jul 17 2015, 1:11 pm
for the purpose of establishing the defense of
res judicata, collateral estoppel, or the law of
the case.

______________________________________________________________________

PETITIONER APPEARING PRO SE: ATTORNEYS FOR RESPONDENT:
RICHARD D. FOSTER GREGORY F. ZOELLER
Branchville, IN ATTORNEY GENERAL OF INDIANA
KENNETH E. BIGGINS
JOHN P. LOWERY
DEPUTY ATTORNEYS GENERAL
Indianapolis, IN
_____________________________________________________________________

IN THE
INDIANA TAX COURT
_____________________________________________________________________

RICHARD D. FOSTER, )
)
Petitioner, )
)
v. ) Cause No. 49T10-1504-TA-00017
)
INDIANA DEPARTMENT OF STATE )
REVENUE, )
)
Respondent. )
______________________________________________________________________

ORDER ON RESPONDENT’S MOTION TO DISMISS

July 17, 2015

WENTWORTH, J.

Richard D. Foster filed an appeal with this Court, claiming that as a result of his

pleading guilty to possession of marijuana, the Indiana Department of State Revenue
illegally assessed Controlled Substance Excise Tax (CSET) and seized the titles to his

vehicles. The Department has moved to dismiss Foster’s appeal alleging that the Court

lacks subject matter jurisdiction. The Court grants the Department’s motion.

FACTS & PROCEDURAL BACKGROUND

On July 20, 1993, Foster was charged with possession of marijuana with intent to

deliver and with violating the controlled substance excise tax provision, Indiana Code §

6-7-3-11. (See Resp’t Mot. Dismiss, Ex 1.) On July 22, 1993, the Department issued

Foster an assessment of CSET, penalties, and interest. (Resp’t Mot. Dismiss, Ex 2. at

5-6.) In accordance with a plea negotiation agreement, Foster pled guilty and was

sentenced on July 25, 1994.

On April 22, 2015, Foster filed an appeal with this Court. In his Complaint, Foster

1) requested that the Department refund all of his tax refunds that had been applied

toward the CSET assessment; 2) sought payment for all of his vehicles that he lost due

to the Department’s seizure of their titles; and 3) sought compensatory and punitive

damages in the amount of $100,000. (Pet’r Prisoner Civil Compl. at 2.) Foster’s

request for relief was based on, among other things, the fact that his plea agreement did

not include the assessment of CSET. (See Pet’r Letter Supp. Mot. J. at 1.)

On June 25, 2015, the Department filed a Motion to Dismiss, asserting the Court

lacked subject matter jurisdiction to hear Foster’s appeal. Additional facts will be

supplied as necessary.

STANDARD OF REVIEW

When this Court rules on a motion to dismiss for lack of subject matter

jurisdiction, it may consider the petition, the motion, and any supporting affidavits or

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evidence. Garwood v. Indiana Dep’t of State Revenue, 998 N.E.2d 314, 317 (Ind. Tax

Ct. 2013) (citations omitted). Furthermore, the Court may weigh the evidence to

determine the existence of requisite jurisdictional facts, resolve factual disputes, and

devise procedures to ferret out the facts pertinent to jurisdiction. Id.

LAW & ANALYSIS

Subject matter jurisdiction, the power of a court to hear and determine a

particular class of cases, can be conferred upon a court only by the Indiana Constitution

or by statute. See K.S. v. State, 849 N.E.2d 538, 540 (Ind. 2006); State v. Sproles, 672

N.E.2d 1353, 1356 (Ind. 1996). The Indiana Tax Court has the power to hear and

determine only those cases that are “original tax appeals,” i.e., appeals that both arise

under the tax laws of Indiana and are initial appeals of a final determination of the

Department. See IND. CODE §§ 33-26-3-1, -3 (2015).

A case arises under Indiana’s tax laws “if (1) ‘an Indiana tax statute creates the

right of action,’ or (2) ‘the case principally involves collection of a tax or defenses to that

collection.’” State ex rel. Zoeller v. Aisin USA Mfg., Inc., 946 N.E.2d 1148, 1152 (Ind.

2011) (quoting Sproles, 672 N.E.2d at 1357). Here, Foster’s claim is that the

Department improperly collected CSET; accordingly, the case arises under the tax laws

of Indiana.

For the Court to have subject matter jurisdiction, the case must also be an initial

appeal from a final determination of the Department. I.C. § 33-26-3-1(1). A final

determination “is an order that determines the rights of, or imposes obligations on, the

parties as a consummation of the administrative process.” See State Bd. of Tax

Comm’rs v. Ispat Inland, Inc., 784 N.E.2d 477, 481 (Ind. 2003). As the Indiana

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Supreme Court has explained,

[a] taxpayer receives a final determination in one of two ways. The
taxpayer can pay the tax, request a refund, and sue in the Tax Court
if the request is denied. Alternatively, the taxpayer can protest the
listed tax at the assessment stage and appeal to the Tax Court from
a letter of findings denying the protest.

Sproles, 672 N.E.2d at 1357 (citations omitted).

The evidence presented in both Foster’s Complaint and the Department’s Motion

to Dismiss with supporting exhibits establishes that Foster neither timely filed a protest

with the Department after it issued the CSET assessment, penalties, and interest on

July 22, 1993, nor timely filed a Claim for Refund with the Department of the money it

applied to his liabilities. See 45 IND. ADMIN. CODE 15-5-8 (2015) (see

http://www.in.gov/legislative/iac/) (requiring a taxpayer to file a written protest 20 days

from the date a CSET assessment or jeopardy assessment is made); IND. CODE § 6-8.1-

9-1(a) (2015) (requiring a taxpayer to file a claim for refund with the Department within 3

years after the latter of the due date of the return or the date of payment).

Consequently, there is no evidence that the Department issued a Letter of Findings, a

Memorandum of Decision, or an Order denying a refund. Accordingly, Foster does not

appeal from a final determination and the Court lacks subject matter jurisdiction to hear

and determine his appeal.

ORDER

The Court, having found that Foster has not taken his appeal from a final

determination of the Department, hereby GRANTS the Department’s Motion to Dismiss.

SO ORDERED this 17th day of July, 2015.

__________________________
Martha Blood Wentworth, Judge
Indiana Tax Court
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Distribution:

Richard D. Foster, Kenneth E. Biggins, John P. Lowrey

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