Okon v. Dept. of Rev.

422 	October 19, 2023 	No. 26
IN THE OREGON TAX COURT
REGULAR DIVISION
Efion E. OKON and
Helen J. Ekpo,
Plaintiffs,
v.
DEPARTMENT OF REVENUE,
State of Oregon,
Defendant.
(TC 5454)
In this personal income tax case, Plaintiffs initially filed their complaint
without paying the assessment or moving for a stay of payment. After the court
issued a notice of their right to do so, Plaintiffs submitted the motion with
the required affidavit under ORS 305.419(3). When Defendant objected that
Plaintiffs’ affidavit showed that they had sufficient home equity to obtain a loan
to pay the tax, the court directed Plaintiffs to submit additional documents and
a statement, under penalty of perjury, addressing their ability to borrow funds.
Plaintiffs responded with a letter, not under penalty of perjury and without sup-
porting documents, stating that federal and Oregon tax liens prevented them
from obtaining a loan. The court convened a case management conference, at
which Plaintiffs described the Oregon and federal tax liens. The court then
directed Plaintiffs to submit documentation of the liens, which Plaintiffs timely
did. The court then made three procedural observations. First, the court recog-
nized that its form of affidavit should be modified to specifically address any liens
against a taxpayer or the taxpayer’s property. Second, before objecting on the
grounds of a taxpayer’s ability to borrow funds to pay an assessment, Defendant
should take the existence of any type of lien into account. Finally, the court put
future parties on notice that it will use its ability to convene a hearing, including
the taking of sworn testimony and authentication of exhibits, under Tax Court
Rule 18 C(3)(b), when its instructions are not closely followed.
Submitted on Plaintiffs’ Motion for Stay of Payment of
Income Tax.
Efion E. Okon, Plaintiff, filed the motion pro se.
Belle Na, Assistant Attorney General, Department of
Justice, Salem, filed the response (objection) for Defendant.
Decision rendered October 19, 2023.
ROBERT T. MANICKE, Judge.
This 	matter 	again 	comes 	before 	the 	court 	on
Plaintiffs’ allegation that immediate payment of the amounts
assessed would constitute an undue hardship under ORS

Cite as 25 OTR 422 (2023) 	423
305.419(3). Plaintiffs, not represented by counsel, filed their
complaint in this division on May 8, 2023, without paying
the assessment and without moving for a stay or filing the
affidavit allowed under ORS 305.419(3). On May 24, 2023,
Defendant moved to dismiss. On May 25, 2023, the court
issued its Order on Defendant’s Motion to Dismiss; Notice
to Plaintiffs of Lack of Affidavit Alleging Hardship, inform-
ing Plaintiffs of their right to move for a stay, supported by
an affidavit, and directing them to so move or to otherwise
respond to Defendant’s motion within 30 days.
On June 20, 2023, Plaintiffs filed a Motion for Stay
of Payment of Income Tax, accompanied by a completed and
notarized affidavit on the form available on the court’s website.
The form asks an affiant to disclose income and expense data
and includes a line item for “Rent/Mortgage,” but the form
does not specifically ask about tax liens. Defendant objected
on July 18, 2023, asserting that the data in Plaintiffs’ affida-
vit indicated an ability to pay the assessment, without undue
hardship, by obtaining a loan secured by their equity in their
home. The objection states that, apart from their mortgage,
Plaintiffs “do not list any other liens against their home.”
Neither Defendant’s objection nor the supporting auditor dec-
laration otherwise indicated whether any federal or Oregon
tax liens applied against Plaintiffs. The declaration did state
that Plaintiffs are on a payment plan with Defendant for
their tax liabilities for tax years not at issue in this case.
In an order dated July 20, 2023, the court directed
Plaintiffs to submit additional documents and a narrative
statement, under penalty of perjury, to address whether
they are able to borrow the funds to pay the assessed
amounts in this case without undue hardship. In response,
Plaintiffs submitted a one-page letter on August 15, 2023,
without any supporting documents, and not under penalty
of perjury. The August 15 letter did, however, state: “[W]e
are unable to get the loan or a second mortgage against our
property due to existing lien on the property by the IRS as
well as Oregon Department of Revenue (ODR).”
The court convened a case management conference
to clarify the quoted statement, informing the parties that
the court “may require Plaintiffs to testify under oath and/

424 	Okon v. Dept. of Rev.
or submit additional information as to their efforts to borrow
the funds needed to pay the assessment.” At the case man-
agement conference, held October 10, 2023, Plaintiff Okon
described the Oregon and federal liens and said that they
have adversely affected his credit rating. Defendant’s coun-
sel acknowledged the existence of an Oregon lien but stated
that it had been released in mid-September 2023. The court
did not put Okon under oath. Defendant requested further
proof of the amount of the federal lien, including the total
amount, proof of monthly payments, and proof of Okon’s
statement at the conference that the monthly payment on
the federal lien would substantially increase in amount
in early 2024. The court directed Plaintiffs to submit the
requested information to Defendant and to the court within
one week. The court also directed Defendant to submit proof
of the release of the Oregon lien.
On October 16, 2023, Plaintiffs submitted docu-
ments addressing each of the points requested by Defendant
and directed by the court. In addition, Plaintiffs submitted
copies of two documents entitled “Notice of Lien Release”
dated September 14, 2023, each with a unique lien number
indicating that the lien had been recorded in Washington
County on March 30, 2018, and released on September
14, 2023. Defendant has not submitted a filing regarding
release of the Oregon lien or liens.
The court makes the following procedural observa-
tions. First, the court recognizes that its form of affidavit
should be modified to specifically address any liens against
a taxpayer or against property of a taxpayer. Second,
Defendant should take the existence of any type of lien into
account before objecting on the grounds of a taxpayer’s ability
to borrow funds to pay the assessment. Third, taxpayers are
well served to closely follow the court’s instructions. Parties
in future cases should expect the court to make greater use
of its ability to convene a hearing under Tax Court Rule 18
C(3)(b), which may include the taking of sworn testimony
and the authentication of exhibits.
In light of Plaintiff’s submission of documents on
October 16, 2023, the court directs Defendant to inform
the court on or before October 27, 2023, whether Defendant

Cite as 25 OTR 422 (2023) 	425
continues to object to Plaintiffs’ Motion for Stay of Payment
of Income Tax. Now, therefore,
IT IS ORDERED that Defendant inform the court
on or before October 27, 2023, whether Defendant continues
to object to Plaintiffs’ Motion for Stay of Payment of Income
Tax.
IT IS FURTHER ORDERED that the court’s order
of July 20, 2023, is superseded by this order.