|Legal Opinion: |
Text of Document: You have asked MTAS to advise you on a matter relating to property tax collection. Two lots were assessed that were owned by the same person. The lots were sold to two different buyers, and at the time of the sale, there were city taxes owed on both lots. The owner of Lot 1 paid the taxes due, but by error the money was credited to Lot 2. You advised the City Recorder to credit the paid taxes to the correct lot, but the Recorder maintained that could not be done. You have asked how this situation should be handled.
The Code of your City adopts the assessment methods set forth in Title 67, Tennessee Code Annotated .(Section 6-110 of your City’s Code). Your city charter has some provisions relating to the Recorder = s duty to collect taxes:
As soon as practicable in each year after the assessment books are complete (which shall be after Equalization Boards provided for by general laws or this Act shall have finished their work), it shall be the duty of the Recorder to prepare or cause to be prepared from the said assessment books a tax book similar in form to that required by the laws of the State to be made out for County Trustee, embracing, however, only such property and persons as are liable for taxes within the City. Such tax books, when certified to be true, correct, and complete by the Recorder, shall be the assessment for taxes in said City for all municipal purposes; provided, that there may be an assessment by the Recorder, at any time, of any property, subject to taxation found to have been omitted, and such assessment shall be duly noted and entered on the assessment books of the City, or on the consolidated assessment books of the County. ( Section 11.04, Charter).
This section raises a couple of useful points: 1. Where property has escaped taxation, as would be the case of the lot which received the erroneous credit, the Recorder may, at any time, assess that property (or more simply, re-issue the tax bill based on the original assessment) and enter it on the assessment book and send it to the property owner. That seems to me to allow the Recorder the flexibility of correcting the mistake made earlier, that is, the erroneous credit of paid taxes which were actually paid for the adjacent lot. 2. The Recorder is required to certify the accuracy and completeness of the tax records. If the mistake is not corrected by appropriate entry, the records will not be able to be certified.
There is also a statute dealing with the assessment of property that has been A omitted from or totally escaped taxation. @ See ' 67-1-1001, Tennessee Code Annotated . ' 67-1-1003 sets out a procedure to follow to re-issue the assessment. It provides a way for the owner to appeal the assessment to the municipal board of equalization. I recommend including a statement concerning this right to appeal on the corrected tax bill to be sent to the owner of the lot upon which the taxes have not been paid. I doubt that any appeal would be successful, as the owner can hardly rely on a clerical mistake which results in a discriminatory effect that inures to his benefit.
Section 11.06 of your city’s charter further explains that A the tax books in the hands of the Recorder shall have the same force and effect of a judgment of a Court of Record . . . @ That being the case, we get guidance on how to deal with mistakes from Rule 60 of the Tennessee Rules of Civil Procedure which states:
Clerical mistakes in judgments, orders or other parts of the record, and errors therein arising from oversight or omissions, may be corrected by the court at any time on its own initiative or on motion of any party . . . Rule 60.01.
Since your charter states that the tax books have the same force and effect as a judgment in a Court of Record, Rule 60.01 may be used by the Recorder to justify the correction of the mistake made by her office in crediting the paid taxes to the wrong lot. She could do a A corrected entry @ in the appropriate places, supported by an Affidavit from herself or the city employee who handled the tax transaction to track through how the payment was credited to the wrong lot.
The steps I= ve outlined in this letter should help your Recorder to make an accurate record of the corrections on the tax records. Let me know if I can help further.