Opinion ID: 2612261
Heading Depth: 1
Heading Rank: 3

Heading: tax-court jurisdiction

Text: The issue before us is whether plaintiff's complaint before the tax court falls within its jurisdiction, ORS 305.405, i.e. whether the complaint requires determination of ... questions... arising under the tax laws of this state. ORS 305.410(1). [4] The complaint does cite tax laws of this state. ORS 321.359(2), 321.820(2); Jarvill v. City of Eugene, 289 Or. 157, 164-66, 613 P.2d 1, cert. den. 449 U.S. 1013, 101 S.Ct. 572, 66 L.Ed.2d 472 (1980). The issue, then, is whether the complaint poses questions arising under these tax laws. Discussing this issue requires us to review the principles of the tax court's subject-matter jurisdiction. Previous opinions have traced the history of ORS 305.405 and 305.410 as first enacted in 1961 and as amended in 1965. See Rosboro Lumber Co. v. Heine, 289 Or. 909, 907-09, 618 P.2d 960 (1980); Jarvill, supra, 289 Or. at 163-64, 613 P.2d 1. The statutes, as interpreted by our cases, establish the following as the important features of the subject matter over which the tax court has jurisdiction: (1) Although the Oregon Tax Court is a court of general rather than limited powers, exercising all remedies of a circuit court, it only has authority to adjudicate those cases and issues properly before it. ORS 305.405, 305.435; Mullenaux v. Department of Revenue, 293 Or. 536, 539, 651 P.2d 724 (1982). (2) The 1961 statute, which granted the tax court authority to determine all questions arising under the tax laws of the state in cases within its jurisdiction, nowhere expressly defined the scope of that jurisdiction. City of Woodburn v. Domogalla, 238 Or. 401, 405-06, 395 P.2d 150 (1964). (3) The 1961 act expressly created tax court jurisdiction over a number of taxes, 1961 Or. Laws chapter 533, sections 40 to 56, and subsequent legislatures have gradually expanded the list of express inclusions. Jarvill, supra, 289 Or. at 164, 613 P.2d 1, note 7. [5] (4) The 1965 amendments added to ORS 305.410 a list of levies and assessments expressly excluded from tax court jurisdiction. Id., 289 Or. at 164, 165, 613 P.2d 1. Certain other statutes expressly exclude tax court jurisdiction. See ORS 111.085 (probate court jurisdiction). (5) Where jurisdiction is neither expressly included nor excluded, ORS 305.410(1) provides generally for jurisdiction over cases arising under the tax laws of this state, a term not defined. Jarvill, supra, 289 Or. at 164, 613 P.2d 1. (6) The tax court is within the judicial branch, ORS 305.405, and jurisdiction there excludes jurisdiction in any other trial court. ORS 305.410(1), (3), 305.845. In turn, this leaves jurisdiction in another court when jurisdiction has not been placed in tax court. [6] (7) The only statutory exception where jurisdiction is concurrent is determining priority of property tax liens. ORS 305.410(2). (8) Jurisdiction over a unified case should not be split between the tax court and another court. Jarvill, supra, 289 Or. at 167, 613 P.2d 1. Plaintiff notes that the arising under language is reminiscent of Article III, section 2 of the United States Constitution and 28 U.S.C. § 1331(a) (1976), which establish the limited federal-question jurisdiction of federal courts. But the sprawling jurisprudence analyzing federal jurisdiction is complicated by problems of federalism not presented by a state court of limited subject-matter jurisdiction. Potentially more relevant are comparisons with other tax courts. When the Oregon Tax Court was created in 1961, it was the first tax court in the United States to be judicial rather than administrative and to have exclusive jurisdiction. The most important existing models were the United States Tax Court and the District of Columbia Tax Court. [7] At that time, both those courts were administrative rather than judicial and had jurisdiction concurrent with judicial courts. [8] The statutes establishing the jurisdiction of those courts is phrased in language not resembling Oregon's. [9] Defining the jurisdiction of an exclusive judicial remedy is a task wholly different from defining that of a concurrent administrative remedy. Oregon's Tax Court Act bears some resemblance to the Model State Tax Court Act, promulgated in 1957, which was fashioned after the District of Columbia Tax Court. [10] The Model Act provides for a quasi-judicial remedy which is described as exclusive but which appears to be only a requirement that administrative remedies be exhausted. [11] The Model Act was not adopted in any jurisdiction. In the intervening two decades, in addition to the District of Columbia Tax Court, which became a judicial body in 1970, see supra note 8, two more states have created judicial tax courts, to some extent modeled on Oregon's. [12] None use jurisdictional language resembling ours. The Hawaii Tax Court has jurisdiction limited to the amount of valuation or taxes in dispute, [13] which appears to be narrower than jurisdiction over all questions arising under the tax laws. The New Jersey Tax Court simply adopts the jurisdiction formerly available on administrative appeal. N.J. Stat. Ann. 2A:3A-3, 54:2-33 (1982 Supp). The Revised Model State Tax Court Act was fashioned after the Oregon statute, [14] and was adopted by the American Bar Association in 1972. [15] Sections 1 and 11 of the Revised Model Act use language resembling ORS 305.405 and 305.410, including the provision for a tax court in the judicial branch with exclusive jurisdiction over all questions arising under the tax laws. [16] However, the commentary to the Act makes clear that it is not the purpose of the model to define the scope of jurisdiction, a matter left to each state. Since 1965, Minnesota has had a tax court within the executive branch. [17] As in the Model Act, supra note 10, although the tax court remedy is described as exclusive, appeal is permitted to district court, and its jurisdiction is concurrent with civil courts. [18] In 1977, Minnesota adopted a jurisdictional statute whose language resembles ORS 305.410(1) and section 11 of the Revised Model Act, including the extension of jurisdiction to all questions arising under the tax laws of the state. The Minnesota statute makes express what is implicit in ours, that a case is outside the jurisdiction of the tax court if it does not arise under the tax laws of the state. That statute provides an exhaustive list of tax laws where our statutes expressly list only certain inclusions and exclusions. [19] In summary, although the judicial structure and jurisdictional language of Oregon's Tax Court have been copied, the features critical to this case remain unique, so the law of other courts cannot help us. Our cases set two boundaries. On the one hand, questions which must be resolved in order to decide taxability or the amount of tax do arise under the tax laws. [20] On the other hand, a precondition to taxation does not arise under the tax laws if jurisdiction to decide that precondition has been affirmatively located in another court or if a decision on the precondition has substantial non-tax consequences. See note 6, supra.