Fuller Mill Realty, LLC v. Rhode Island Department of Revenue Division of Taxation

Supreme Court

No. 2022-122-M.P.
(A.A. 22-4)

Fuller Mill Realty, LLC :

v. :

Rhode Island Department of :
Revenue Division of Taxation.

NOTICE: This opinion is subject to formal revision
before publication in the Rhode Island Reporter. Readers
are requested to notify the Opinion Analyst, Supreme
Court of Rhode Island, 250 Benefit Street, Providence,
Rhode Island 02903, at Telephone (401) 222-3258 or
Email opinionanalyst@courts.ri.gov, of any typographical
or other formal errors in order that corrections may be
made before the opinion is published.
Supreme Court

No. 2022-122-M.P.
(A.A. 22-4)

Fuller Mill Realty, LLC :

v. :

Rhode Island Department of :
Revenue Division of Taxation.

Present: Suttell, C.J., Goldberg, Robinson, Lynch Prata, and Long, JJ.

OPINION

Justice Robinson, for the Court. This case is before this Court pursuant to

the grant of a petition for certiorari which was filed on May 2, 2022 by the defendant,

the Rhode Island Department of Revenue Division of Taxation (the Division). The

Division sought review of the April 11, 2022 order of the District Court denying the

Division’s motion to dismiss the January 11, 2022 appeal filed by the plaintiff, Fuller

Mill Realty, LLC (Fuller Mill). The Division contended that the hearing judge erred

in denying its motion because, in its view, he (1) ignored the terms of the settlement

agreement and (2) “wrongfully found that [Fuller Mill] was entitled to an

administrative hearing” before the Division. This Court granted the petition for

certiorari on May 2, 2023.

The parties were directed to appear before the Supreme Court and show cause
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why the issues raised by the parties should not be summarily decided. After

considering the parties’ written and oral submissions, and after carefully reviewing

the record, we conclude that cause has not been shown and that this case may be

decided without further briefing or argument. For the reasons set forth in this

opinion, we quash the order of the District Court and remand for entry of an order

dismissing the case.

I

Facts and Travel

This case involves the Rhode Island Historic Preservation Tax Credits

Program, which program is administered by the Division. Under the program,

applicants which “incur qualified rehabilitation expenditures for the substantial

rehabilitation of certified historic structures” and which satisfy certain requirements

receive a tax credit for state income tax purposes. See G.L. 1956 § 44-33.6-4. Fuller

Mill, an applicant which satisfied the initial criteria, entered into an historic tax credit

agreement with the Division on June 9, 2016 (the original agreement) relative to a

project known as the George H. Fuller Building Project.

On July 10, 2018, the Division notified Fuller Mill that, because quarterly

reports “indicated that the project had remained idle for more than six (6) months,”

Fuller Mill had “forfeited its rights, claims, and entitlement to any historic tax credits

for its project.” Fuller Mill protested the forfeiture, and administrative proceedings

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commenced. Fuller Mill provided the Division with “supplemental documentation

indicating that the project did not remain idle,” and both parties then entered into a

“Stipulation of Settlement and Dismissal” on August 6, 2019, which reinstated

Fuller Mill’s historic tax credits.

Fuller Mill continued work on the project, but it “was further delayed due to

the impacts of the global COVID-19 pandemic.” On November 18, 2020, the

Division notified Fuller Mill that its “tax credits were being rescinded” because it

had failed to complete the project by the May 2018 completion date required by the

original agreement. Fuller Mill protested and requested an administrative hearing in

order to challenge the rescission.

In April 2021, the parties entered into another “Stipulation of Settlement and

Dismissal” (the April 2021 stipulation), which extended to November 9, 2021 the

date by which Fuller Mill would be required to complete substantial construction.

The April 2021 stipulation further stated that Fuller Mill’s failure to meet the

deadline would “result in the forfeiture of all rights, claims and entitlements to the

tax credits”—and, significantly, it also specifically stated that “[s]uch forfeiture will

not be subject to appeal.” Also included in the April 2021 stipulation was a provision

entitled “Waiver of Hearing,” which reads as follows:

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“By agreeing to resolve this matter through the execution
of this Stipulation, the Applicant knowingly and
voluntarily waives any right to an administrative hearing
on the underlying merits of the administrative action and
waives any right to pursue an appeal to the District
Court * * *.”

On December 1, 2021, the Division informed Fuller Mill by letter that, as a

result of its failure to abide by the terms of the April 2021 stipulation by the

November 9, 2021 deadline, Fuller Mill “no longer has tax credits available * * *.”

On December 7, 2021, Fuller Mill requested a hearing before the tax administrator

to establish that it should be excused from timely performance due to force majeure.1

It contended that, although it had “waived its right to appeal whether or not it ha[d]

spent [the required amount] by November 9, 2021, it ha[d] not waived its right to a

hearing to determine if the Division of Taxation was correct to revoke the * * * tax

credits.” The Division denied the request for a hearing on December 22, 2021.

On January 11, 2022, Fuller Mill filed an appeal in the District Court,

contending that it had not requested a hearing for the purpose of appealing the

Division’s decision that Fuller Mill had not met the terms of the April 2021

stipulation, but rather “to determine whether the performance * * * was excused by

1
Force majeure has been defined as “[a]n event or effect that can be neither
anticipated nor controlled; esp., an unexpected event that prevents someone from
doing or completing something that he or she had agreed or officially planned to
do.” Black’s Law Dictionary 788 (11th ed. 2019).

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force majeure.” Fuller Mill further asserted that the “Division does not have the

discretion to deny the request for a hearing pursuant to [G.L. 1956] § 44-1-32.”2

On February 2, 2022, the Division filed in the District Court a motion to

dismiss the appeal pursuant to Rule 12(b)(6) of the District Court Civil Rules. The

Division argued that, according to the “clear and unambiguous” terms of the April

2021 stipulation, Fuller Mill had “expressly waived its right to appeal the forfeiture

of its tax credits, and waived its right to an administrative hearing and administrative

appeal in District Court.”

On April 5, 2022, a hearing on the Division’s motion to dismiss was held, at

the conclusion of which the hearing judge denied said motion. He concluded,

somewhat opaquely, that § 44-1-32 did not allow the Division to “ex parte make a

decision * * * that the requirements were not fulfilled as to the stipulation and that

2
General Laws 1956 § 44-1-32 states:

“Any taxpayer aggrieved by the action of the tax
administrator in determining the amount of any tax, any
surcharge that is required to be remitted to the tax division
pursuant to § 39-21.1-14 or penalty for which a hearing is
not provided may apply to the tax administrator, in
writing, within thirty (30) days after notice of the
assessment is mailed to the taxpayer, for a hearing relative
to the tax or penalty. The tax administrator shall, as soon
as practicable, fix a time and place for the hearing and
shall, after the hearing, determine the correct amount of
the tax, interest, and penalty.”

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there was not potentially a justifiable reason.” An order denying the Division’s

motion to dismiss was entered on April 11, 2022. The Division thereafter filed a

petition for writ of certiorari, which this Court granted on May 2, 2023.

II

Standard of Review

On the relatively rare occasions when we review by certiorari interlocutory

decisions regarding the denial of a Rule 12(b)(6) motion to dismiss, we apply the

same standards that we apply when reviewing the grant of such a motion.3 Imperial

Casualty and Indemnity Company v. Bellini, 746 A.2d 130, 132 (R.I. 2000)

(“Generally, we decline to review on certiorari interlocutory decisions such as the

denial of a motion to dismiss * * *. In those limited circumstances in which we issue

the writ, we apply on review the same standard as that applied in reviewing the grant

of such a motion.”) (citation omitted). In conducting our review pursuant to the

provisions of Rule 12(b)(6), we apply the same standards applied by the hearing

justice. See Rein v. ESS Group, Inc., 184 A.3d 695, 699 (R.I. 2018); Goddard v. APG

Security-RI, LLC, 134 A.3d 173, 175 (R.I. 2016). In doing so, we limit our review

to the complaint, assume that the facts and allegations in the complaint are true, and

3
Rule 12(b)(6) of the District Court Civil Rules is identical to Rule 12(b)(6) of
the Superior Court Rules of Civil Procedure; we may look to cases interpreting one
when interpreting the other. See Apex Oil Company, Inc. v. State, 297 A.3d 96, 107
n.9 (R.I. 2023).
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view them in the light most favorable to the plaintiff. Pontarelli v. Rhode Island

Department of Elementary and Secondary Education, 176 A.3d 472, 476

(R.I. 2018). However, the rule that we limit our review to the allegations in the

complaint is not absolute. We have recognized “a narrow exception for documents

the authenticity of which are not disputed by the parties; for official public records;

for documents central to plaintiffs’ claim; or for documents sufficiently referred to

in the complaint.” EDC Investment, LLC v. UTGR, Inc., 275 A.3d 537, 542-43

(R.I. 2022) (internal quotation marks omitted). A motion to dismiss may be granted

only “if it appears beyond a reasonable doubt that a plaintiff would not be entitled

to relief under any conceivable set of facts.” Pontarelli, 176 A.3d at 476 (deletion

omitted) (quoting Multi-State Restoration, Inc. v. DWS Properties, LLC, 61 A.3d

414, 416 (R.I. 2013)).

III

The Contentions of the Parties

The Division argues that the terms of the April 2021 stipulation “are valid and

binding, and [Fuller Mill’s] Complaint is barred as a result.” It emphasizes that

“[t]he plain, unambiguous, and unmistakable language of the waivers states that

Fuller [Mill] waived its right to an administrative hearing on the merits of the

administrative action and any right to appeal to District Court.” The Division further

contends that, in holding that Fuller Mill was entitled to an administrative hearing,

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the hearing judge ignored the impact of both the April 2021 stipulation and “the

relevant statutes and regulations.”4 The Division also contends that the original

agreement’s force majeure exception “was not intended to apply to [Fuller Mill’s]

forfeiture of the tax credits for its failure to meet the Substantial Construction

deadline.”5 It is the Division’s position that “[t]he clear intent of the mandatory

terms used by the parties demonstrates that the forfeiture for failing to meet the

Substantial Construction deadline is final, not subject to excusal by a reason of a

force majeure and, most importantly, not subject to appeal.”

4
The controlling statute is § 44-1-32. See footnote 2, supra. The controlling
regulation is 280 RICR 20-20-6.18, which reads in pertinent part as follows:

“Any Person aggrieved by the Division of Taxation’s
denial of a tax credit or tax benefit under this program shall
notify the Division of Taxation in writing, within thirty
(30) days from the date of mailing of the notice of denial
of the tax credit, and request a hearing relative to the denial
of the tax credit. The Division of Taxation shall, as soon
as is practicable, set a time and place for hearing, and shall
render a final decision.”
5
The force majeure clause in the original agreement reads as follows:

“To be deemed an event of force majeure, the cause of the
event must be (i) reasonably unforeseen, (ii) outside the
control of the Applicant and (iii) could not be avoided by
the Applicant’s exercise of due care. By way of example,
and not in limitation, any delays, work stoppages, or work
force reductions caused by financial difficulties, labor
disputes or violation of the law shall be deemed to cause
the Project to Remain Idle.”
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Fuller Mill contends that the April 2021 stipulation did not contain “a global

waiver” of its right to a hearing; it argues that conferring an “unfettered discretion”

on the Division to revoke tax credits “was outside of the parties’ contemplations

* * *.” Fuller Mill further contends that the hearing judge “properly held that [the

Division] lacked any discretion to refuse [Fuller Mill’s] timely request for a hearing

* * *.” Fuller Mill asserts that “the applicable statutory and regulatory provisions”

(viz., § 44-1-32 and 280 RICR 20-20-6.18) are “unambiguous and must be applied

literally.” Fuller Mill contends that, in light of these provisions, the Division “lacks

the authority to deny a request for a hearing” because they “clearly compel the

[Division] to provide that hearing and do not afford the [Division] with any

discretion to refuse the request.” In addition, Fuller Mill states that the April 2021

stipulation “does not contain an express waiver or modification which would have

limited the applicability of [the force majeure clause] to only the Project Completion

date and not to Substantial Completion.” Fuller Mill states that “the provisions in

the [original agreement] that are consistent with the [April 2021 stipulation] were

not modified” and that, therefore, the force majeure clause is not inconsistent with

the terms of the April 2021 stipulation because it “does not state that [Fuller Mill] is

precluded from invoking [the force majeure clause] as to Substantial Completion.”

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IV

Analysis

In determining whether contract terms, such as those in the April 2021

stipulation, are ambiguous, “we give words their plain, ordinary, and usual

meaning.” Chariho Regional School District, by and through Chariho Regional

School Committee v. State, 207 A.3d 1007, 1015 (R.I. 2019) (quoting Botelho v. City

of Pawtucket School Department, 130 A.3d 172, 176 (R.I. 2016)). If we do not

discern any contractual ambiguity, “our judicial role becomes quite straightforward:

the plain language * * * is to be applied.” Papudesu v. Medical Malpractice Joint

Underwriting Association of Rhode Island, 18 A.3d 495, 498 (R.I. 2011). Moreover,

“[t]he subjective intent of the parties may not properly be considered by the Court;

rather, we consider the intent expressed by the language of the contract.” Derderian

v. Essex Insurance Co., 44 A.3d 122, 128 (R.I. 2012) (internal quotation marks

omitted). When a contract is unambiguous, “we simply consider the dictates of the

plain language in the contract.” Papudesu, 18 A.3d at 498.

We have carefully examined the language in the April 2021 stipulation at issue

in this case, which states that Fuller Mill “knowingly and voluntarily waives any

right to an administrative hearing on the underlying merits of the administrative

action and waives any right to pursue an appeal to the District Court * * *.”

(Emphasis added.) We consider the meaning of those words to be unambiguous,

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straightforward, and readily understandable. The incontestable fact is that Fuller

Mill “knowingly and voluntarily” waived its right to both an administrative hearing

and to a District Court appeal with respect to the Division’s determination that Fuller

Mill’s tax credit rights had been forfeited. Although that language clearly waives

certain rights of which Fuller Mill otherwise could have availed itself, that is

precisely what the April 2021 stipulation provides. See Papudesu, 18 A.3d at 498

(“[W]e do not actually construe an unambiguous contract; we simply consider the

dictates of the plain language in the contract.”); see also F.D. McKendall Lumber

Co. v. Kalian, 425 A.2d 515, 518 (R.I. 1981). In our judgment, the terms of the

April 2021 stipulation are clear, and they must be applied as they are written. See

Young v. Warwick Rollermagic Skating Center, Inc., 973 A.2d 553, 560 (R.I. 2009)

(“When * * * we are confronted with unambiguous contractual words, what is

claimed to have been the subjective intent of the parties is of no moment.”); Gorman

v. Gorman, 883 A.2d 732, 739 n.11 (R.I. 2005) (“Under established contract law

principles, when there is an unambiguous contract and no proof of duress or the like,

the terms of the contract are to be applied as written.”); W.P. Associates v. Forcier,

Inc., 637 A.2d 353, 356 (R.I. 1994). Accordingly, it is our view that the hearing

judge erred in denying the Division’s motion to dismiss.

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V

Conclusion

For the reasons set forth in this opinion, we quash the order of the District

Court denying the Division’s motion to dismiss, and we remand the case to the

District Court with directions that it enter an order dismissing the case.

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STATE OF RHODE ISLAND
SUPREME COURT – CLERK’S OFFICE
Licht Judicial Complex
250 Benefit Street
Providence, RI 02903

OPINION COVER SHEET

Fuller Mill Realty, LLC v. Rhode Island Department
Title of Case
of Revenue Division of Taxation.
No. 2022-122-M.P.
Case Number
(A.A. 22-4)

Date Opinion Filed May 2, 2024

Suttell, C.J., Goldberg, Robinson, Lynch Prata, and
Justices
Long, JJ.

Written By Associate Justice William P. Robinson III

Source of Appeal Sixth Division District Court

Judicial Officer from Lower Court Associate Justice Christopher Smith

For Plaintiff:

Marc DeSisto, Esq.
Attorney(s) on Appeal
For Defendant:

Nicholas J. Hemond, Esq.

SU-CMS-02A (revised November 2022)