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Kerr v. Commonwealth

Commonwealth Court of Pennsylvania

May 7, 2018

Robert M. Kerr, Petitioner
v.
Commonwealth of Pennsylvania, Respondent

          Submitted: April 11, 2018

          BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge HONORABLE ROBERT SIMPSON, Judge HONORABLE PATRICIA A. McCULLOUGH, Judge HONORABLE ANNE E. COVEY, Judge HONORABLE MICHAEL H. WOJCIK, Judge HONORABLE CHRISTINE FIZZANO CANNON, Judge HONORABLE ELLEN CEISLER, Judge

          OPINION

          ANNE E. COVEY, Judge

         Robert M. Kerr (Kerr) filed exceptions pursuant to Pennsylvania Rule of Appellate Procedure (Rule) 1571(i)[1] to this Court's July 6, 2017 order affirming the Board of Finance and Revenue's (Board) January 25, 2012 order sustaining the Board of Appeals' (Appeals Board) dismissal of Kerr's Petition for Reassessment (Petition) (Exceptions). The sole issue before the Court is whether the Court erred by concluding that Kerr's Petition was untimely filed.[2] After review, we overrule Kerr's Exceptions.

         The procedural posture of this case is undisputed. See Stipulation of Facts (Stipulation).[3] By April 7, 2009 notice, the Commonwealth of Pennsylvania Department of Revenue (Department) assessed taxes, penalties and interest on income Kerr, a Georgia resident, derived from his investment in PSMK Associates, a Pennsylvania limited partnership (Assessment Notice).[4] See Stip. ¶ 3; see also Stip. Ex. H. The Department sent the Assessment Notice to Kerr by certified mail at 1126 Shoreline Drive, Jefferson, Georgia. See Stip. Ex. H. A bar code and certified mailing number 7179 0771 4430 9024 3503 appear at the top of the Assessment Notice and next to the number are the words "Certified Mail Number." See Stip. Ex. H. The Assessment Notice contained the following instructions:

YOU HAVE THE RIGHT TO APPEAL FOR A REASSESSMENT OR REFUND. DETAILS OF YOUR APPEAL RIGHTS ARE ENCLOSED (SEE REV-554). . . . A TAXPAYER DISAGREEING WITH THE ASSESSMENT OF TAX MUST FILE A PETITION FOR REASSESSMENT OR REFUND. APPEALS MUST BE FILED BY THE FOLLOWING DATE: 1) ON OR BEFORE JULY 06 2009 A PETITION FOR REASSESSMENT MUST BE FILED OR 2) ON OR BEFORE OCT 07 2009 REMIT THE BALANCE DUE TO THE [DEPARTMENT] AND FILE A PETITION FOR REFUND. APPEALS ARE CONSIDERED TIMELY IF POSTMARKED BY THE U.S. POSTAL SERVICE ON OR BEFORE THE LAST DAY FOR PETITIONING FOR REASSESSMENT OR REFUND OR IF RECEIVED AT THE ADDRESS BELOW ON OR BEFORE THE LAST DAY FOR PETITIONING FOR REASSESSMENT OR REFUND.

Stip. Ex. H. at 3 (emphasis added).

         Kerr filed the Petition with the Appeals Board on March 25, 2011. See Stip. ¶ 6. The Appeals Board dismissed the Petition because it was not timely filed. Kerr appealed from that decision to the Board. By January 25, 2012 order, the Board sustained the Appeals Board's decision. Kerr appealed to this Court.[5] On July 6, 2017, this Court affirmed the Board's order. Kerr timely filed the Exceptions which are now before this Court en banc.[6]

         Kerr argues in his brief in support of his Exceptions (Exceptions Brief) that Section 338(a) of the Tax Reform Code of 1971 (Code), [7] requires that the Assessment Notice be sent by certified mail and, since the Assessment Notice was not stamped with a certified mail tracking number, "[i]f the Commonwealth cannot produce this number, then the [Assessment Notice] is void and . . . should be set aside" because it "may never have been mailed." Exceptions ¶ 11(j); see also Kerr Exceptions Br. at 10, 13; Kerr Original Br. at 10, 13. In support of his position, Kerr stated that "he never received the [A]ssessment [Notice], " and "he did not learn of [it] until liens were filed." Stip. ¶ 4. This position is the identical argument Kerr made in his original appeal to this Court.

         In concluding that Kerr's Petition was late-filed, this Court observed that the Assessment Notice was sent to Kerr's record address in Georgia and, despite that the Commonwealth did not produce a stamped post office receipt, the Assessment Notice clearly contains a certified mailing number. See Stip. Ex. H. Moreover, shortly after the Assessment Notice was mailed, the Department received an April 30, 2009 letter from certified public accountant, Paul Frederick Kelly (Kelly), wherein Kelly stated: "[Kerr] is not aware of any taxable issues that would create [the Assessment Notice] and believes this [Assessment Notice] is in error. Please provide [Kerr] a copy of the document you used to prepare [the Assessment Notice]." Stip. Ex. I; see also Stip. ¶ 5. Kelly's letter reflects that it was copied to Kerr. See Stip. Ex. I. By June 10, 2009 letter, sent by certified mail to Kerr at 1126 Shoreline Drive, Jefferson, Georgia, the Department's Pass Through Business Office explained its assessment. See Stip. Ex. J; see also Stip. ¶ 5. The Department's June 10, 2009 letter further specified:

If you should disagree with the adjusted tax liability, you must file a petition for reassessment or refund. The specific filing deadlines are printed on the assessment.
Please review the attached Preservation of Appeal Rights[8]that explains that even if you contact the [Department] after you receive the assessment your time to appeal to the [Appeals Board] is still running. More information on filing an appeal can be found at www.boardofappeals.state.pa.us[.]

See Stip. Ex. J (emphasis added). The return receipt reflects that Kerr received the Department's June 10, 2009 letter on June 12, 2009, at the same address where the Department's April 2009 Assessment Notice was mailed. See Stip. Ex. J at 4. Kerr filed the Petition on March 25, 2011. See Stip. ¶ 6.

[Kerr] contacted the Department on August 19, 2009 and October 21, 2009 regarding the assessment of 2006 tax due. Department records show that a member of the Pass-Through Business Office spoke to [Kerr] on October 22, 2009, during which [Kerr] indicated that he did not receive the Department's [A]ssessment [N]otice. The Department then informed [Kerr] of his right[] to appeal the assessment to the [Appeals Board] and resent ...

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