Court Opinion

ID: 9370027
Source: CourtListenerOpinion
Date Created: 2023-02-10 17:02:28.716063+00
Date Added: 2024-06-11T17:16:18.790958
License: Public Domain

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE

250 EXECUTIVE, LLC,                        )
                                           )
      Petitioner,                          )
                                           )
            v.                             )
                                           )   C.A. No. N22C-03-190 FWW
                                           )
CHRISTINA SCHOOL DISTRICT                  )
and CHRISTINA SCHOOL                       )
DISTRICT BOARD OF EDUCATION,               )
                                           )
      Respondents.                         )

                          Submitted: February 6, 2023
                           Decided: February 9, 2023

Upon Respondents Christina School District and Christina School District Board
                  of Education’s Motion for Reargument
                                DENIED.

                                   ORDER

Daniel F. McAllister, Esquire, MCALLISTER FIRM LLC, 800 North King Street,
Suite 203, Wilmington, Delaware 19801, Attorney for Petitioner 250 Executive,
LLC.

James H. McMackin, III, Esquire and Michelle G. Bounds, Esquire, MORRIS
JAMES LLP, 500 Delaware Avenue, Suite 1500, Wilmington, Delaware 19801,
Attorneys for Defendants Christina School District and Christina School District
Board of Education.

WHARTON, J.
        This 9th day of February, 2023, upon consideration of Respondent Christina

School District and Christina School District Board of Education’s (collectively “the

District”) Motion for Reargument and the record in this case, it appears to the Court

that:

        1.    250 Executive, LLC (“250 Executive”) brought this declaratory

judgment action seeking a refund of nearly $70,000 in erroneously overpaid school

taxes that it alleges the District impermissibly kept in violation of 14 Del. C. § 1921

(the “Refund Statute”).

        2.    The parties submitted cross-motions for summary judgment on

stipulated facts. On January 30, 2023, the Court granted 250 Executive’s motion

and denied the District’s motion.1 The Court held that while the Refund Statute gave

the District the discretion to determine the merits of 250 Executive’s refund request,

it did not give it discretion to reject a properly filed, meritorious request.2 The Court

further held that because 250 Executive’s refund request was properly filed and

meritorious, it followed that the District improperly exercised its discretion in

denying the request.3 The Court remanded the matter to the District to submit 250

Executive’s refund request to the receiver of taxes in accordance with its Opinion.4

1
  250 Executive, LLC v. Christina Sch. Dist., et al., 2023 WL 1113221 (Del. Super.
Ct. Jan. 30, 2023) (corrected Feb. 1, 2023).
2
  Id. at 9.
3
  Id.
4
  Id.

                                           1
      3.     The District moves for reargument on two grounds.5 First, it alleges

that the Court’s decision, while correctly recognizing the District’s discretionary role

in resolving refund requests, has resulted in a manifest injustice because it

“simultaneously impos[ed] hard and fast rules as to the exercise of that discretion.”6

The District contends that the Court improperly limited the Districts discretion to

‘“determining if the refund request contains all of the statutorily required

information and if the taxpayer paid the taxes erroneously or mistakenly in the

amount of the requested refund.”’7 According to the District, the Court eliminated

its ability to “factor 250 Executive’s lack of diligence [in seeking a refund],” thereby

“turning the District’s role in the refund process to one of formality rather than

substance.”8 The related second ground tendered by the District asserts that when

the Court found that the District lacked a legitimate basis to deny the refund request,

it misapprehended the facts and ignored legal principles9 Specifically, the District

argues that the Court ignored 250 Executive’s role in failing to identify the

overpayment for thirteen years and the District’s role as an uninvolved third party.10

5
  Mot. for Rearg., D.I. 34.
6
  Id. at 2.
7
  Id. (quoting the 250 Executive, LLC, 2023 WL 1113221 at *8).
8
  Id. at 2-3.
9
  Id. at 4.
10
   Id.

                                           2
       4.       Pursuant to Superior Court Civil Rule 59(e), a motion for reargument

will be granted only if the Court has “overlooked a controlling precedent or legal

principles, or the Court has misapprehended the law or facts such as would have

changed the outcome of the underlying decision.”11 A motion for reargument is not

an opportunity for a party to either rehash arguments already decided by the Court

or to present new arguments the moving party could have raised previously.12

Therefore, to succeed on such a motion, the moving party “has the burden of

demonstrating newly discovered evidence, a change in the law or manifest

injustice.”13

       5.       The Court is unpersuaded by either of the District’s arguments. Both

arguments are predicated on the notion that the District is now precluded from taking

into consideration 250 Executive’s delay in seeking a refund. The Court addressed

the issue of a time-bar in its Memorandum Opinion and found that unlike statutes in

several other jurisdictions, the Refund Statute has no time-limiting language and that

250 Executive did not delay once it discovered the County’s mistake in assessing its

property.14 Thus, to the extent the District was precluded from considering the

11
   Janeve Co., Inc. v. City of Wilmington, 2009 WL 2386152, at *1 (Del. Super. Ct.
July 24, 2009) (quoting Reid v. Hindt, 2008 WL 2943373, at *1 (Del. Super. Ct. July
31, 2008)).
12
   Reid, 2008 WL 2943373, at *1 (citations omitted).
13
   Id. (quoting State v. Brooks, 2008 WL 435085 at *2 (Del. Super. Ct. Feb. 12,
2008).
14
   250 Executive, LLC, 2023 WL 1113221 at *4.

                                           3
timing of 250 Executive’s request, it was because the Refund Statute did not give it

that authority.

      6.     The District claims the Court’s decision is inconsistent, in that it held

that the Refund Statute ‘“implicitly confers the District with some authority,”’ but,

by limiting its discretion, the Court reduced the District’s role to ‘“a mere pass-

through.’”15 The District misreads the Court’s decision. The Refund Statute

requires a request for a refund be submitted to the District under oath or affirmation,

stating the payment of taxes, by whom the taxes were paid, the date of the payment,

and why the taxes were paid in error.16 The Court’s decision should not be read to

preclude the District from exercising its discretion in determining the validity of the

information submitted by the taxpayer, including whether and why the taxes were

paid in error. In fact, the Court observed that it fully expected the District to

encounter situations where issues might arise concerning the validity of requests,

especially concerning whether the taxes were paid erroneously or mistakenly.17

“The Court does not intend to preclude the District from exercising its discretion in

making factual determinations in those situations.”18 The Court, however, does

intend to insure compliance with the Refund Statute by precluding the District from

15
   Mot. for Rearg. at 3-4 (quoting 250 Executive, LLC, 2023 WL 1113221 at *7),
D.I. 34
16
   14 Del. C. § 1921.
17
   250 Executive at *8 n. 88.
18
   Id.

                                          4
arbitrarily denying all refund requests simply because it believes it needs the money

more than the taxpayer.19

      7.     The District argues that the Court has deprived it of discretion, but, in

reality, it never purported to exercise any discretion. Like all other requests for

refunds of allegedly overpaid taxes, the board voted to reject 250 Executive’s refund

request.20 250 Executive claims that the District “asked no questions” and that after

rendering its decision “did not state their reasons on the record for their vote or their

decision.”21 In its answer to 250 Executive’s Amended Complaint, the District wrote

that “[a]ny characterization of the hearing is denied as stated.”22 The District did not

explain in any of its written submissions or during oral argument what, if any, criteria

were used to evaluate the merits of the refund request. Certainly, in this litigation,

it has not produced a transcript or correspondence where the District explained its

decision. The record is barren of anything to support an argument that the timing

of 250 Executive’s request was a factor in the District’s denial.

      8.     Relatedly, the Court did not ignore 250 Executive’s alleged culpability

in failing to remedy the overpayment. The District simply never justified its denial

on that basis, or any other basis for that matter, when it denied 250 Executive’s

19
   Id. at 4.
20
   Op. Br. at ¶ 7–8.
21
   Am. Compl., at ¶ 17, D.I. 5.
22
   Ans. to Am. Compl., at ¶17, D.I. 6.

                                           5
request. The District now complains that it was deprived of an opportunity to

exercise the discretion it never exercised in fact. As the Court wrote:

             If the District is vested with discretion, that discretion
             necessarily is circumscribed by a requirement that it be
             exercised reasonably by evaluating requests in good faith
             and making decisions based on their merits…Here the
             District denied an application in the proper form that
             clearly established that 250 Executive paid taxes
             mistakenly or erroneously. It did so without justification
             or explanation (emphasis added.)23

Now that it is involved in litigation, the District is asking the Court to permit it to

retroactively apply a discretionary gloss on what was, at the time, an arbitrary

decision. The Court declines that request.

      9.     The District also argues that the Court misapprehended facts and

ignored legal principles when it failed to consider that the District was blameless in

creating the mistake that resulted in 250 Executive’s overpayment.24           On the

contrary, nothing in the language of the Refund Statute limits refunds to taxes

overpaid only as a result of errors for which the District is blameworthy, nor has the

District cited to any such language. The Court appreciates that, unlike in McGinnes

v. Dep’t of Finance,25 the District here did not cause 250 Executive’s overpayment.

23
   250 Executive at *7.
24
   Mot. for Rearg. at 4-5, D.I. 34.
25
   377 A.2d 16 (Del. Ch. 1977).

                                          6
Nonetheless, it was the recipient of the erroneous overpayments and it is not entitled

to keep them.26

        10.   Accordingly, the Court finds that it did not “overlook controlling

precedent or legal principles” or “misapprehend the law or facts such as would have

changed the outcome of the underlying decision,” nor has the District demonstrated

that it has suffered a manifest injustice.

        THEREFORE, Christina School District and Christina School District Board

of Education’s Motion for Reargument is DENIED.

IT IS SO ORDERED.

                                                    /s/ Ferris W. Wharton
                                                     Ferris W. Wharton, J.

26
     See 250 Executive, LLC, 2023 WL 1113221 at *8.

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