June 29, 1992
Ron Schreiner, Secretary
Department of Revenue
700 Governors Drive
Pierre, SD 57501
OFFICIAL OPINION NO. 92-07
State Board of Equalization appeals procedure
Dear Mr. Schreiner:
You have requested an official opinion of this office in regard to the following factual situation:
FACTS:
The South Dakota State Board of Equalization meets yearly to consider appeals regarding the assessment and equalization of real property within the state. SDCL 10-11-46. Other than the assessment and equalization of centrally assessed property, appeals to the South Dakota State Board of Equalization are from the various County Boards of Equalization throughout the state. Questions have arisen concerning the interpretation of SDCL 10-11-42, which allows for appeal from the County Board of Equalization to the State Board of Equalization upon oral announcement by the aggrieved property owner, or by written notification.
Some property owners have orally announced to the County Board of Equalization after a decision on their property was made, and appear to have complied with the statute. However, other property owners have announced prior to any decision of the County Board of Equalization, and still others have made no oral announcement at all.
This third group merely marks a blank on the appeal form which indicates that they are orally announcing their decision to appeal to the State Board of Equalization. The blank may be checked at any time from the initial local Board of Equalization hearing all through the County Board of Equalization. The form was designed for the county auditor to check that blank if, indeed, the individual orally gave notice of his intention to appeal to the State Board of Equalization.
Regarding written notice of intent to appeal to the State Board of Equalization, some property owners have properly complied by filing notice with the county auditor and sending a copy to my office. There have been other instances when the notice was given, in writing, to the county auditor, but the property owner did not send a copy or notify the Revenue Department. There have been other instances when the Revenue Department was notified in writing, but the county auditor did not receive notification. Further, there seems to be a question as to who is to give the written notice to my office, the county auditor or the property owner.
Based upon the above factual situation, you have asked the following questions:
1. What is the proper method of orally appealing a decision of the County Board of Equalization to the State Board of Equalization?
2. What is the proper way to take a written appeal from a decision of the County Board of Equalization to the State Board of Equalization?
3. What is the result if the property owner does not properly comply with either the oral or written notice of appeal?
GENERAL DISCUSSION:
Prior to addressing each question individually, it is helpful to generally discuss the subject of appeals to the State Board of Equalization.
As you have indicated, the State Board of Equalization meets yearly to consider assessment and equalization appeals. SDCL 10-11-46. The method of appealing from a County Board of Equalization is delineated in SDCL 10-11-42, which reads in full as follows:
Any person, firm or corporation, public or private, feeling aggrieved by the action of the county board of equalization relative to the assessment of its property or any taxing district or governmental subdivision or agency in which such property is located, feeling aggrieved by the action of the county board of equalization may appeal to the state board of equalization for a determination of such grievance. The county board of equalization shall notify in writing by certified or registered mail each person owning property on which action was taken of the decision within five days of such decision. Such appeal may be taken by oral announcement thereof at the session of the county board in which case it shall be noted in the abstract to be prepared by the county auditor as provided in 10-11-41, or it may be taken by written notice filed with the county auditor and a copy thereof mailed to the secretary of revenue, Pierre, South Dakota, no later than the third Friday in June. The notice shall state informally the substance of the decision appealed from and the grounds upon which appeal is taken. The county board of equalization or any person pecuniarily interested in sustaining its decision, as well as the appellant, may be heard in person or by attorney upon appeals to the state board of equalization. Nothing herein prevents an appeal to the circuit court as provided in 10-11-44, but an appeal to either tribunal shall exclude an appeal to the other.
With the appropriate statute in mind, I will now turn to the questions presented.
IN RE QUESTION NO. 1:
Your first question asks the proper way of orally appealing to the State Board of Equalization. The pertinent portion of SDCL 10-11-42 states that "[s]uch appeal may be taken by oral announcement thereof at the session of the county board in which case it shall be noted in the abstract to be prepared by the county auditor as provided in 10-11-41 . . .." The statute indicates that several things must happen for a proper oral appeal from a County Board to the State Board. To begin, the County Board of Equalization must have made its decision regarding the individual's property. It is impossible to appeal a decision of the County Board of Equalization before the County Board has made its decision.
Another criterion for a valid oral appeal is that the appeal must be made orally by the person aggrieved or legal representative thereof to the County Board of Equalization while the County Board is in session. A telephone call to the Board of Equalization will not be sufficient. Oral announcement will not be sufficient if it is to any other county body, governmental official, or to individual Board of Equalization members. Finally, the announcement must be made to the County Board of Equalization when it is sitting as a board of equalization within the required time limits. SDCL 10-11-25.
Once an oral appeal is made, the county auditor is required to note the appeal in the abstract prepared in accordance with SDCL 10-11-41. Such abstract note, however, may only be completed after a valid oral appeal is made.
To summarize, an oral appeal to the State Board of Equalization must be made after the County Board of Equalization has made its decision; it must be personally (orally) made to the County Board of Equalization when the Board is sitting as the County Board of Equalization; and it must be made within the required time period.
IN RE QUESTION NO. 2:
Your second question asks how a written appeal is properly made to the State Board of Equalization. SDCL 10-11-42 indicates that an appeal "may be taken by written notice filed with the county auditor and a copy thereof mailed to the secretary of revenue, Pierre, South Dakota, no later than the third Friday in June."
The first requirement of the written appeal process is that a written notice be filed with the county auditor. Such filing must take place "no later than the third Friday in June." SDCL 10-11-42. Mailing the notice of appeal to the county auditor does not comply with the statute. The document must be received and filed in the county auditor's office within the time period.
A second part of the written appeal requirements is that a copy be mailed to the Secretary of Revenue in Pierre. The copy that is referred to in SDCL 10-11-42 is a copy of the written notice filed with the county auditor. It is the aggrieved party's obligation to mail a copy of the notice of appeal to the Secretary of Revenue. Further, it is only necessary that the copy be mailed "no later than the third Friday in June." Reference must then be made to the postmark on the envelope containing the photocopy of the written notice to determine if it was timely mailed to the Secretary of Revenue.
SDCL 10-11-42 goes on to discuss the contents of the written notice of appeal. Section 10-11-42 generally states that the notice shall informally state the decision of the County Board of Equalization and the grounds upon which the person is appealing. The notice should, at the very least, contain a legal description of the property, the action taken by the County Board of Equalization, and why the aggrieved party feels that the County Board's action is incorrect.
To summarize, a written appeal to the State Board of Equalization must be filed with the county auditor, and a copy mailed to the Secretary of Revenue (both by the property owner) "no later than the third Friday in June." SDCL 10-11-42.
IN RE QUESTION NO. 3:
Your third question asks the result of a failure to properly appeal to the State Board, either orally or in writing.
I am of the opinion that failure to follow the procedures of oral announcement, or written notice, as I have set forth in questions 1 and 2 above, are jurisdictional defects. Since the errors are jurisdictional defects, the State Board of Equalization is deprived of authority to hear the appeal. Any party that does not comply with the oral announcement or written notice requirements must have his appeal dismissed for lack of jurisdiction over the subject matter.
The South Dakota Supreme Court has addressed subject matter jurisdiction requirements of notices of appeal. The Supreme Court has held that failure to perfect an appeal consistent with the statutory guidelines will render the appeal without jurisdiction, and subject to dismissal. See Morrell Livestock Co. v. Stockman's Commission Co., 77 S.D. 114, 86 N.W.2d 533 (1957); Lyndoe v. American Standard Insurance Co., 245 N.W.2d 273 (S.D. 1976); Stark v. Munce Bros. Tranf. & Storage, 461 N.W.2d 587 (S.D. 1990); Local 49 v. Aberdeen School District 6-1, 463 N.W.2d 843 (S.D. 1990). Our Supreme Court has also held that "subject matter jurisdiction cannot be acquired by estoppel." Honomichl v. State, 333 N.W.2d 797, 799 (S.D. 1983).
To summarize, failure to perfect an appeal from the County Board of Equalization to the State Board of Equalization, either orally or in writing, pursuant to SDCL 10-11-42 results in a jurisdictional defect depriving the State Board of Equalization the authority to hear the appeal. The State Board of Equalization is required to dismiss appeals that do not comply with SDCL 10-11-42. As we previously have informed every county auditor in the state, these are the rules that must be followed when appealing to the State Board of Equalization.
Respectfully submitted,
MARK BARNETT
ATTORNEY GENERAL
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