CHOCKALINGAM S. PALANIAPPAN, Appellant
HARRIS COUNTY APPRAISAL DISTRICT, Appellee
On Appeal from the 11th District Court Harris County, Texas Trial Court Case No. 2008-61882
Panel consists of Justices Keyes, Bland, and Sharp.
MEMORANDUM OPINIONON REHEARING 
Jim Sharp, Justice
Chockalingam S. Palaniappan filed a suit for judicial review in district court, pursuant to Tax Code Chapter 42, challenging the Harris County Appraisal District's (HCAD) appraised value of his property for the 2008 tax year. HCAD moved to dismiss for lack of subject-matter jurisdiction alleging that Palaniappan had failed to comply with Tax Code section 42.08. The trial court granted the motion and dismissed Palaniappan's suit. In eight issues, Palaniappan argues that the trial court erred by granting HCAD's motion to dismiss and denying his motion for substantial compliance. We affirm the trial court's judgment.
Palaniappan owns real property in Houston, Harris County, Texas that HCAD appraised at $960, 401 in 2008. Based on this appraised value, Palaniappan owed approximately $13, 000 in ad valorem taxes on the property for tax year 2008. Palaniappan protested the appraisal value to HCAD's Appraisal Review Board (ARB). After the ARB denied Palaniappan's protest, Palaniappan filed suit against HCAD in district court on October 16, 2008.
In his petition, Palaniappan stated, "Pursuant to Section 42.08, Plaintiff intends on timely paying all taxes due on the property, or the taxes due on the undisputed portion of the value of the property, or, if unable to timely pay the lesser of these amounts, Plaintiff requests relief from the Court." Palaniappan's 2008 taxes were due before February 1, 2009. On January 23, 2009, Palaniappan paid $1, 800 in property taxes. Palaniappan continued to make periodic payments after the February 1, 2009 delinquency date and, by June 30, 2009, Palaniappan had paid off the entire balance due for tax year 2008.
Prior to trial on Palaniappan's suit for judicial review in 2011, HCAD moved to dismiss the suit for lack of subject-matter jurisdiction based on Palaniappan's noncompliance with section 42.08. In particular, HCAD alleged that Palaniappan had failed to fully or substantially comply with Tax Code subsection 42.08(b)'s prepayment tax provision, which requires "a property owner who appeals . . . [to] pay taxes . . . in the amount required by this subsection before the delinquency date or the property owner forfeits the right to proceed to a final determination of the appeal." Tex. Tax Code Ann. § 42.08(b) (West Supp. 2013).
Palaniappan responded that he complied with subsection 42.08(b)'s prepayment requirement because he paid "an undisputed amount" of the taxes due prior to the delinquency date. Id. § 42.08(b)(1) (allowing property owner to pay "the amount of taxes due on the portion of the taxable value of the property that is not in dispute"). Palaniappan also argued that he was excused from the prepayment requirement by section 42.08(d), which allows a property owner to "be excused from the requirement of prepayment of tax as a prerequisite to appeal if the court . . . finds that such prepayment would constitute an unreasonable restraint on the party's right of access to the courts." Id. § 42.08(d).
In support of this contention, Palaniappan filed an oath of inability to pay and a motion to determine substantial compliance pursuant to section 42.08(d). In his oath of inability to pay, Palaniappan stated:
The ad valorem taxes for the property were due before February 1, 2009. The ad valorem taxes for the property were not paid prior to February 1, 2009 because as of January 31, 2009, the due date, I was financially unable to pay those taxes in full. I had paid an undisputed portion of the taxes to the Harris County tax office on January 23, 2009. I paid the remainder of the taxes due on the property as the funds came available to do so. The tax payments were paid from my personal bank account and the bank account of another business entity I own, Intec of Houston Metro Partnership ("Intec"). These accounts are the same accounts that are used by the business operating at the property that is subject of this suit. As of June 30, 2009, the property taxes for the tax year 2008 were paid in full. See the cancelled checks and bank account records evidencing the inability to pay the entire amount of taxes attached as an exhibit to this affidavit.
In response, HCAD filed an amended motion to dismiss, and attached certified copies of tax records showing that, as of January 29, 2009, Palaniappan paid $1, 800 towards his 2007 and 2008 tax bills.
On March 31, 2011, the trial court held an evidentiary hearing on Palaniappan's oath of inability to pay and HCAD's motion to dismiss. At the hearing, Palaniappan testified that he paid $1, 800 in property taxes a little over a week before the 2008 taxes became delinquent. When the trial court inquired about the total amount of taxes due for the 2008 tax year, Palaniappan's attorney stated that the total amount of ad valorem taxes due on the property was approximately $13, 000, based on HCAD's appraisal value of $960, 401.
When his counsel asked if he could "afford financially to pay any more than $1, 800 for taxes" as of January 31, 2009, Palaniappan responded, "No, I couldn't"; he also attached financial records to his oath of inability to pay. Palaniappan testified that paying any more than $1, 800 prior to the delinquency date would have created a financial hardship for him and his business and he probably would have had to lay off employees as a result. According to Palaniappan, he paid the full balance due on his 2008 taxes by June 30, 2009.
When Palaniappan's counsel asked him if he paid "an undisputed amount of taxes" for the 2008 tax year prior to the delinquency date, Palaniappan responded, "Yes." At that point, the trial court interceded, asking, "Wait. Explain that to me. What is the amount that you contend was undisputed?" Palaniappan's counsel replied, "Your Honor, any amount would arguably be undisputed that being paid." The trial court asked what Palaniappan's experts thought the property should have been appraised at for 2008 and Palaniappan's counsel informed the trial court that their experts appraised the 2008 value of the property at $610, 703, and counsel estimated that the total amount of taxes due, based on that appraised value, was approximately $7, 000. Palaniappan's counsel noted that their expert's report was completed after the delinquency date. However, when the trial court asked, "But at this point anyway we know that the undisputed amount would be the amount that your experts contend was the appropriate appraised value?" Palaniappan's counsel responded, "Now, yes, Your Honor."
The trial court granted HCAD's motion and denied Palaniappan's section 42.08(d) motion for substantial compliance. The trial court also entered the following Findings of Fact and Conclusions of Law:
FINDINGS OF FACT
1. Plaintiff, Chockalingam S. Palaniappan, was the owner of the property made the subject of this lawsuit during the relevant time period of January 1, 2008, and said property was located in Harris County, Texas.
2. The property made the subject of this suit bears Harris County Appraisal District Account Number 0451630000114.
3. The delinquency date for the payment of ad valorem taxes for the property made the subject of this lawsuit is February 1, 2009.
4. Plaintiff did not file an oath of inability to pay ad valorem taxes prior to the delinquency date.
5. Plaintiff made payments for ad valorem taxes for tax year 2008 on January 23, 2009, June 22, 2009, and June 30, 2009.
6. Plaintiff did not pay the undisputed amount of the ad valorem taxes due prior to the delinquency date.
7. No and/or insufficient, credible or relevant evidence was adduced by Plaintiff relating to financial hardship for the ...