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### STATE OF MICHIGAN

COURT OF APPEALS

JOSEPH A. BAUBLIS,

Petitioner-Appellant, UNPUBLISHED November 29, 2016

v No. 328320 Michigan Tax Tribunal CITY OF ANN ARBOR, LC No. 14-007632-TT

Respondent-Appellee.

Before: R ONAYNE K RAUSE , P.J., and O’C ONNELL and G LEICHER , JJ.

P ER C URIAM

.

Petitioner appeals by right the Michigan Tax Tribunal’s denial of his motion for summary disposition, final opinion, and judgment. Petitioner sought to avoid the payment of real property taxes pursuant to respondent’s poverty exemption under MCL 211. 7u. Respondent denied petitioner’s application because it found that petitioner did n ot meet its definition for being impoverished. Specifically, res pondent’s guidelines state that poverty “does not include having the inability to afford ones property taxes due to a self impos ed situation.” Respondent was concerned that petitioner had purchased the property in cash, o nly to mortgage it to a former roommate for the same amount a month and a half later, and eith er his poverty was self-inflicted for purchasing a house with no income, or he in fact had income that he was failing to disclose. Petitioner appealed to the Mich igan Tax Tribunal, which, after a hearing, affirmed that petitioner was not entitled to the pove rty exemption. We affirm.

Our review of Tax Tribunal decisions is very limited. Drew v Cass County , 299 Mich App 495, 498; 830 NW2d 832 (2013). “In the absence of fraud, e rror of law or the adoption of wrong principles, no appeal may be taken to any court from any final agency provided for the administration of property tax laws from any decision relating to valuation or allocation.” Const 1963, art 6, § 28. Otherwise, we are limited to reviewing for a “misapplication of the law or adoption of a wrong principle.” Wexford Med Group v City of Cadillac , 474 Mich 192, 201; 713 NW2d 734 (2006). We review questions of statutory interpretati on de novo. Id . at 202.

As an initial matter, “tax-exemption statutes are strictly con strued in favor of the taxing unit,” although they remain subject to the “ordinary rules of s tatutory construction.” InterCooperative Council v Dep ’ t of Treasury , 257 Mich App 219, 222-223; 668 NW2d 181 (2003). This is because, “if an exemption is found to exist, it must no t be enlarged by construction, since the reasonable presumption is that the State has granted in exp ress terms all it intended to grant-2- at all[.]” Menard Inc v Dep ’ t of Treasury , 302 Mich App 467, 475; 838 NW2d 736 (2013) (citation and quotations omitted). Our goal in constructing st atutory language is to discern the intent of the legislature, whic h, if the language used is clear and unambiguous, is presumptively plainly expressed and must be applied as written. Alliance Obstetrics & Gynecology v Dep ’ t of Treasury , 285 Mich App 284, 286; 776 NW2d 160 (2009).

Petitioner argues that the principle of construing tax exempti ons in favor of the taxing authority is based on a misreading of Justice Cooley’s Treatise on Taxation . Petitioner’s argument is difficult to follow, but petitioner apparently make s this argument because of a misunderstanding of what the word “public” means. Petitioner q uotes, “ . . . when a special privilege or exemption is claimed under a statute or act of inc orporation, it is to be construed strictly against the property owner and in favor of the public. ” The taxing authority is, in fact, the “public.” Petitioner even di rectly quotes Justice Cooley’s statement that “when an exemption is found to exist, it shall not be enlarged by construction.” This is precisely what petitioner appears, confusingly, to be arguing against. Treatises, of cou rse, lack the force of binding law, whereas we are bound by stare decisis to follow the decisions o f our Supreme Court, see Charles A Murray Trust v Futrell , 303 Mich App 28, 48; 840 NW2d 775 (2013), which apply this principle, see e.g., Ladies Literary Club v Grand Rapids , 409 Mich 748, 753; 298 NW2d 422 (1980). We find that it is petit ioner whose construction of Ju stice Cooley’s treatise is inconsistent with the plain la nguage therein, but we would not be at liberty to overturn a decision by our Supreme Court in any event.

Insofar as we can determine from petitioner’s confusing and in consistent arguments, he contends that respondent’s guide lines violate subsections (4) a nd (5) of MCL 211.7u because they fail to provide guidance regarding “self imposed situation ,” the significance of “purchasing a home with no income,” the definition of “poverty,” or the sig nificance of the applicant’s credibility. Petitione r further contends ( albeit inconsistentl y) that the tribunal improperly granted discretion to respondent where the statute allegedly grants non e. MCL 211.7u provides in relevant part:

(1) The principal residence of persons who, in the judgment of the supervisor and board of review, by reason of pove rty, are unable to contribute toward the public charges is eligible for exemption in whole or in part from taxa tion under this act. This section does not apply to t he property of a corporation.

(2) To be eligible for exemption under this section, a person s hall do all of the following on an annual basis:

(a) Be an owner of and occupy as a principal residence the pro perty for which an exemption is requested.

(b) File a claim with the supervisor or board of review on a f orm provided by the local assessing unit, accompanied by federal and state i ncome tax returns for all persons residing in the principal residence, including any property tax credit returns, filed in the im mediately preceding year or in t he current year . . .-3- (c) Produce a valid driver’s license or other form of identifi cation if requested by the supervisor or board of review.

(d) Produce a deed . . . of ownership of the property for whic h an exemption is requested if requi red by the supervisor or board o f review.

(e) Meet the federal poverty guidelines . . . or alternative guidel ines adopted by the governing body of the local assessing unit provi ded the alternative guidelines do not provide incom e eligibility requirements less than the federal guidelines.

* * *

(4) The governing body of the local a ssessing unit shall determine and make available to the public the policy and guidelines the local ass essing unit uses for the granting of exemptions under this section. The guidelines shall include but not be limited to the specific income and asset levels of the c laimant and total

household income and assets.

(5) The board of review shall follow the policy and guidelines of t he local assessing unit in granting or d enying an exemption under this s ection unless the board of review determines there are substantial and compelling reasons why there should be a deviation from the policy and guidelines and the substantial and compelling reasons are communicat ed in writing to the claimant.

Procedurally, the petitioner has the burden of showing that he is entitled to the poverty tax exemption and “must prove, among other things, that he or she m eets the poverty guidelines.” Spranger v City of Warren , 308 Mich App 477, 479; 865 NW2d 52 (2014), citing MCL 211.7u(2)(e). The petitioner’s application “must be submitted on a form provided by the local assessing unit, MCL 211.7u(2)(b) and must comply with the polic ies and guidelines of the local assessing unit, MCL 211.7u(4).” Spranger , 308 Mich App at 479-480. “In deciding whether to grant the requested poverty exemption, the board of review must generally follow the policies and guidelines of the local tax ing unit unless it finds that th ere are substantial and compelling

reasons to deviate therefrom.” Id . at 480, citing MCL 211.7u(5).

In relevant part, respondent’s g uidelines reiterated the subst ance of MCL 211.7u(1) and added that respondent “further defines a Poverty exemption as h aving insufficient resources beyond ones control to pay ones property taxes” and “does not i nclude having the inability to afford ones property taxes due to a self imposed situation.” T he guidelines established a maximum income level of $19,500 for a single person in the hous ehold, with a maximum of $25,000 in assets “other than the homestead and standard mode o f transportation.” Petitioner apparently believes that the phrase “self imposed situation” pr ovides insufficient guidance and is inconsistent with MCL 211.7u. We disagree.

The word “poverty” is not defined by statute, so it is proper to rely on a dictionary to provide its definition. Pobursky v Gee , 249 Mich App 44, 46; 640 NW2d 597 (2001). Thus, poverty may be defined as “the state of one who lacks a usual o r socially acceptable amount of money or material possessions,” M erriam-Webster’s Collegiate Di ctionary (11 th ed), or “[t]he-4- condition of being indigent; the scarcity of the means of subsi stence,” Black’s Law Dictionary (8 th ed). Indigency in the latter dictionary refers to “lack[ing] the means of subsistence.” Id

. Therefore, MCL 211.7u(1) plainly and unambiguously requires an inability to pay one’s taxes because the person lacks sufficient resources in essentially al l other respects as well. We think it obvious that “poverty” does not mean lacking in any money, nor does it necessarily require a person to prioritize pa yment of taxes over purchasing very basi c necessities for survival. However, the equally obvious corollary is that “poverty” is a m eaningfully involuntary state; an inability logically precludes having chosen such a state. We appreciate that a person might have some superficial and technical choices they can make about how to order their affairs, while lacking any practical choices tha t would have meaningful effect . Nevertheless, in light of the statute’s express grant of “j udgment” to the supervisor and boa rd of review, we find no ambiguity in distinguishing betw een a technical choice and a pr actical one.

Respondent’s use of the phrase “self-imposed situation” is the refore perfectly consistent with MCL 211.7u(1). The statute requires municipalities to det ermine “the policy and guidelines” that its assessor’s office will use for the grantin g of a poverty exemption, and further requires an exercise of discretion in their execution. Respond ent’s prohibition against “selfimposed situations” constituting “poverty” is well within the m eaning of “poverty” as defined and as commonly understood. Petiti oner’s objections to respond ent’s guidelines are meritless.

Petitioner does not directly raise any argument on appeal seri ously challenging the evidence against him, beyond arguing that respondent erred in a dministering the statute. Nonetheless, we briefly address the evidence for completeness. Petitioner does, relatedly, argue that the evidence he presented i n his own favor should have war ranted summary disposition in

his favor.

We review the Tax Tribunal’s f actual findings only to determin e whether “they are supported by competent, material, and substantial evidence on t he whole record.” Drew , 299 Mich App at 499 (citation and qu otations omitted). “Substantia l evidence” is “more than a scintilla of evidence, although it may be substantially less th an a preponderance of the evidence.” Leahy v Orion Twp , 269 Mich App 527, 529-530; 711 NW 2d 438 (2006) (citation and quotation omitted). Because the Tax Tribunal lacks a formal rule pertain ing to motions for summary disposition, we refer to MCR 2.116(C). See TTR 792.102105 (ind icating that in the absence of an applicable tribunal rule, the Michigan court rules or the ad ministrative procedures act shall apply). We review motions for summary disposition de novo; und er MCR 2.116(C)(10) we consider all of the evidence submitted in the light most favora ble to the non-moving party to determine whether a genuine issue of material fact exists. Maiden v Rozwood , 461 Mich 109, 118-120; 597 NW2d 817 (1999). A genuine issue of material fact exists when the record leaves open “an issue upon which reasonable minds might differ.” Debano-Griffin v Lake Co , 493 Mich 167, 175; 828 NW2d 634 (2013) (quotation omitted).

Although petitioner’s applicati on indicates that he meets resp ondent’s income and asset guidelines necessary to qualify for the exemption, other eviden ce suggests that petitioner’s

submissions of income and assets are not credible. Petitioner contends that credibility is an impermissible basis for a denial because it is not explicitly l isted as such, but this reflects a fundamental misunderstanding of what credibility means in conte xt. Here, it means there are such significant discrepancies between petitioner’s reported in come and apparent expenditures-5- and assets, as derived from such evidence as his cash purchase of the property, monthly payments, and business expenses, that the only rational conclus ion is that petitioner’s selfreported lack of income must be incorrect. Consequently, the e vidence shows that petitioner is not truly as impoverished as he claims. Additionally, even if a given person genuinely cannot execute a particular responsib ility, voluntarily assuming that responsibility anyw ay certainly constitutes a “self-imposed situ ation.” There is no indicationthat petitioner’s financial situation unexpectedly, abruptly, and uncont rollably changed immediately after he purchas ed the property, nor is there any indication thathe was unaware that property t axes are a well-established phenomenon. Because substantial, competent, and material evide nce supports the Tax Tribunal’s finding that, however it is phrased, we defer to the Tax Tribunal’s findings. Stege v Dep ’ t of Treasury , 252 Mich App 183, 188; 651 NW2d 164 (2002).

Petitioner’s summary disposition argument fails for the same r eason. Petitioner argues that because his reported income and asset levels fall below th e guideline’s levels, there is no question of fact that he is entitled to the exemption. If that had been the only evidence introduced, petitioner’s argument might have some merit. Howev er, as discussed, there was considerable evidence strongly suggesting that petitioner’s rep orted income was fictitious, and also as discussed, respondent’s guidelines were entirely proper . Consequently, petitioner failed to establish that no question of f act existed regarding his ent itlement to the tax exemption.

Finally, petitioner makes an equally meritless argument that the Tax Tribunal erred by denying his motion for discovery because, inter alia , he sought to determine whether MCL 211.7u had been correctly discharged and he had no “reliable ex planation why [his] application was denied . . . ” Because petitioner initiated his claim in t he small claims division, the formal rules of discovery are inapp licable. See MCL 600.8411. In any event, respondent correctly points out that petiti oner already had the information he sough t: respondent had already attached

all documents relevant to the den ial, including the handwritten notes on petitioner’s application explaining the basis for the denial. In other words, petitione r had been given an explanation; petitioner simply did not understa nd it or did not like it. Th e Tax Tribunal did not in any way abuse its discretion by declini ng to order respondent to provid e petitioner wit h an additional copy of the documentation petiti oner already possessed.

Affirmed.

/s/ Amy Ronayne Krause

/s/ Peter D. O’Connell

/s/ Elizabeth L. Gleicher