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Piwonka v. SPX Corporation

Court of Appeals of Texas, Fourteenth District

March 30, 2017

DAVID PIWONKA, IN HIS OFFICIAL CAPACITY AS TAX ASSESSOR-COLLECTOR FOR CYPRESS-FAIRBANKS ISD, CYPRESS-FAIRBANKS ISD, ANN HARRIS BENNETT, 1 IN HER OFFICIAL CAPACITY AS TAX ASSESSOR-COLLECTOR FOR HARRIS COUNTY, TEXAS, and HARRISCOUNTY, TEXAS, Appellants
v.
SPX CORPORATION D/B/A SPX FLOW TECHNOLOGY, Appellee

         On Appeal from the 80th District Court Harris County, Texas Trial Court Cause No. 2015-08078

          Panel consists of Justices Busby, Donovan, and Wise.

          MEMORANDUM OPINION [1]

          John Donovan Justice

         David Piwonka, in his official capacity as Tax Assessor-Collector for Cypress-Fairbanks ISD, and Cypress-Fairbanks ISD (collectively "Cy-Fair appellants"), and Mike Sullivan, in his official capacity as Tax Assessor-Collector for Harris County, Texas, both appeal the denial of their pleas to the jurisdiction. The pleas were filed in a suit brought by SPX Corporation d/b/a SPX Flow Technology alleging improper correction of the tax appraisal roll.[2] Specifically, SPX challenges Sullivan's assessment of taxes for Lone Star College and Harris County Emergency Services District #9 ("HCESD#9") for tax years 2010-2013 and penalties and interest for tax year 2010 on behalf of those two taxing units. Further, SPX contests Piwonka's assessment of taxes for Cy-Fair ISD for tax years 2010-2013 and penalties and interest for those tax years.

         I. BACKGROUND

         SPX owns tangible personal property ("the property") located within Harris County, Texas. In December 2013, Sands Stiefer, Chief Appraiser for Harris County Appraisal District ("HCAD"), realized the property was not listed under the correct taxing jurisdictions on the appraisal roll. HCAD sought to correct the appraisal roll by changing the taxing jurisdictions for the property from Houston ISD ("HISD"), Houston Community College ("HCC"), and City of Houston ("COH"), where the property was incorrectly listed, to Cy-Fair ISD, Lone Star College, and Harris County Emergency Services District #9 ("HCESD#9"). In its pleadings, SPX concedes the appraisal record should have been corrected once the error was discovered.

         In January 2014, HCAD filed a motion under section 25.25(c)(3) of the Tax Code to change the property's appraisal roll entry for tax years 2010-2013, inclusive, to reflect the correct taxing jurisdictions. See Tex. Tax Code Ann. § 25.25(c)(3) (West 2015). The Harris County Appraisal Review Board ("ARB") approved the motion.

         According to HCAD, a letter for each tax year was sent to SPX's tax agent on February 18, 2014. The letters informed SPX that HCAD had taken action to correct the tax appraisal rolls in accordance with section 25.25(c)(3) and that a protest could be filed with the ARB within 30 days of the date of the letter. SPX contends it never received the notice.

         In April and May of 2014, corrected appraisal rolls were generated to remove HISD, HCC, and COH for tax years 2010, 2011, 2012, and 2013. Also, corrected appraisal rolls were generated to add Cy-Fair ISD, Lone Star College, and HCESD#9 as the correct jurisdictions for tax years 2010, 2011, 2012, and 2013.

         Sullivan translated these changes into tax bills and refunds for each taxing jurisdiction other than Cy-Fair ISD, but he did not process each tax year in the same manner. For tax year 2010, Sullivan processed a refund to SPX of the taxes paid to HISD, HCC, and COH in May 2014. Sullivan later sent SPX a corrected tax bill for tax year 2010 to collect taxes owed to Lone Star College and HCESD#9. Sullivan concedes the record does not reflect when the corrected tax bill was sent, but the delinquency date (when penalties and interest would begin to be owed if the bill was not paid) utilized by Sullivan was August 1, 2014.

         For tax years 2011 through 2013, however, Sullivan followed a different procedure. For tax year 2011, Sullivan processed a refund to SPX of the taxes paid to HISD, HCC, and COH, and paid the taxes owed to Lone Star College and HCESD#9. Sullivan did the same for tax year 2012 and 2013. For tax years 2011, 2012, and 2013, the taxes paid to HISD, HCC and COH were more than those owed to Lone Star College and HCESD#9, so refund checks were issued for the balance.

         Sullivan paid no taxes to Cy-Fair ISD because it has its own tax collector. Cy-Fair ISD issued corrected tax bills for tax years 2010 through 2013. The delinquency dates utilized for these bills were in May, June, and July 2014.

         After delinquency notices were sent, SPX tendered payment, under protest, of the taxes owed to Lone Star College and HCESD#9 for tax year 2010 and to Cy-Fair ISD for tax years 2010-2013, but not the claimed penalties and interest. In September 2014, SPX filed a protest with the ARB pursuant to section 41.49(a)(9) of the Tax Code. See Tex. Tax Code Ann. § 41.41(a)(9) (West 2015). SPX's protest disputed that it received notice of the correction by letters dated February 18, 2014. See Tex. Tax Code Ann. § 41.411 (West 2015).[3] The ARB denied SPX's protest by written orders.

         On February 12, 2015, SPX filed suit against HCAD, ARB, Sullivan, in his official capacity as Tax Assessor-Collector for Harris County, Stiefer in his official capacity as Chief Appraiser for HCAD, Harris County, Cy-Fair ISD, and Piwonka, in his official capacity as Tax Assessor-Collector for Cy-Fair ISD. In its petition, SPX "does not dispute that the appraisal record should have been changed to indicate Cy-Fair ISD and the other new entities once the error was discovered." Rather, SPX contends the changes were not made in accordance with the provisions of the Tax Code.

         The Cy-Fair appellants moved to dismiss the case for lack of jurisdiction. Subsequently Harris County and Sullivan also filed a plea to the jurisdiction. The trial court denied both motions.

         The Cy-Fair appellants filed a notice of interlocutory appeal from the trial court's orders, as did Harris County and Sullivan. See Tex. Civ. Prac. & Rem. Code § 51.014(a)(8) (West Supp. 2016). Subsequently, SPX entered into a Rule 11 agreement with Harris County to dismiss with prejudice SPX's claims for the HISD, HCC, and COH taxes. Harris County did not file a brief in this appeal and was notified on March 2, 2017, that its appeal would be dismissed for want of prosecution. Because the response filed March 8, 2017, does not demonstrate meritorious grounds for continuing the appeal, Harris County's appeal is dismissed for want of prosecution.

         We begin by addressing Sullivan's contention that SPX does not have standing to bring its suit. We will then turn to the claims of Sullivan and Cy-Fair appellants that the trial court should have ...


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