Court Opinion

ID: 4071600
Source: CourtListenerOpinion
Date Created: 2016-09-30 02:10:51.101634+00
Date Added: 2024-06-11T14:32:10.811893
License: Public Domain

ACCEPTED
                                                                                      14-00343
                                                                   FOURTH COURT OF APPEALS
                                                                        SAN ANTONIO, TEXAS
                                                                          6/12/2015 4:28:22 PM
                                                                                KEITH HOTTLE
                                                                                        CLERK

                        NO. 04-14-00343-CV

                   IN THE             FILED IN
                                4th COURT OF APPEALS
           FOURTH COURT OF APPEALS
                                 SAN ANTONIO, TEXAS
                                                      06/12/2015 4:28:22 PM
                    San Antonio, Texas                   KEITH E. HOTTLE
                                                               Clerk
               ___________________________________

            EXLP LEASING, LLC and EES LESING, LLC,
                          Appellants

                                v.

             WEBB COUNTY APPRAISAL DISTRICT and
           UNITED INDEPENDENT SCHOOL DISTRICT
                                   Appellees
              ______________________________________
               From the 406th Judicial District, Webb County Texas
                   Trial Court No. 2013-CV-8000074-D4
                  The Hon. Oscar J. Hale, Jr., Judge Presiding
__________________________________________________________________
   UNITED INDEPENDENT SCHOOL DISTRICT’S MOTION FOR
                                REHEARING
__________________________________________________________________

                              Alberto Alarcon
                                State Bar No. 00968425
                              Paul C. Saenz
                                State Bar No. 24013441
                              Guillermo G. Alarcon
                                State Bar No. 00968410
                              ALARCON & SAENZ, PLLC
                              1302 Washington
                              Laredo, Texas 78040
                              Tel. (956) 727 8585
                              Fax. (956)727 8597
                              Email: aalarcon@sbcglobal.net

                              ATTORNEYS FOR THE UNITED
                              INDEPENDENT SCHOOL DISTRICT
                            TABLE OF CONTENTS

Index of Authorities…………………………………………………………………ii

Points Relied Upon Rehearing………………………………………………………iii

Argument……………………………………………………………………………1

  I.     Under the doctrine of the “last antecedent”, the phrase “not in dispute” refers
         to value, the last and nearest antecedent, and not to the more remote phrase
         “the amount of taxes due”…………………………………………………1

  II.    Applying the phrase “not in dispute” to “the amount of taxes due” renders
         the phrase “taxable value” meaningless and superfluous…………………...2

  III.   Under the Court’s ruling, taxpayers will be able to extend the delinquency
         date, avoiding interest and penalties, without paying anything, simply by
         adding a situs dispute to their protest and appeal, regardless of merit; this is
         in direct contravention of the Legislature’s policy………………………….2

Conclusion and Prayer……………………………………………………………….4

Certificate of Service…………………………………………………………………6

Certificate of Compliance……………………………………………………………7

                                           i
                         INDEX OF AUTHORITIES

Cases

Christus Health Gulf Coast v. Aetna, Inc., 397 S.W.3d 651 (Tex. 2013)……… ………4

Columbia Med. Ctr. of Las Colinas, Inc. v. Hogue, 271 S.W.3d 238 (Tex. 2008)... ………2

Entergy Gulf States, Inc. v. Summers, 282 S.W.3d 433 (Tex. 2009)……………. ………1

In re Ford Motor Co., 442 S.W.3d 265 (Tex. 2014)…………………………. ………2

Palaniappan v. Harris Cnty. Appraisal Dist., No. 01-11-00344-CV, 2013 WL
6857983 (Tex. App.-Houston [1st Dist.] Dec. 31, 2013, no pet.) (not
designated by publication)………………………………………………. ………3

Texas W. Oaks Hosp., LP v. Williams, 371 S.W.3d 171 (Tex. 2012)……….. ………1

Valerus Compression Services v. Gregg County Appraisal Dist., 457 S.W.3d 520
(Tex. App.-Tyler 2015, no pet.)………………………………………….. …...iv, 4

Statutes and Rules

Tex. Tax Code Ann. § 1.04 (10) (West, Westlawnext through 2015 Sess.)…     ……...1

Tex. Tax Code Ann. § 23.1241 (West, Westlawnext through 2015 Sess.)….. …...iv, 4

Tex. Tax Code Ann. § 41.4115 (b), 41A.10 (a), 42.08 (a) (West,
Westlawnext through 2015 Sess.)………………………………………...                          ……...2

Tex. Tax Code Ann. § 41.42 (West, Westlawnext through 2015 Sess.).......... ……...iv

Tex. Tax Code Ann. § 42.08 (a) (West, Westlawnext through 2015 Sess.)…      …...3, 4

Tex. Tax Code Ann. § 42.08 (b) (1) (West, Westlawnext through 2015
Sess.)……………………………………………………………………. ...iii, v, 1

Tex. Tax Code Ann. § 42.08 (d) (West, Westlawnext through 2015 Sess.)…     ……...3

Tex. R. App. P. 49.1……………………………………………………... ……...iii

                                         ii
                     POINTS RELIED UPON REHEARING

       Pursuant to Rule 49.1 of the Texas Rules of Appellate Procedure, Appellee,

United Independent School District (“UISD”), relies on the following points in filing

this motion for rehearing:

       Section 42.08 (b) (1) of the Texas Tax Code requires a payment in order to

prevent the forfeiture of judicial review. The actual text states that the payment must

be in “the amount of the taxes due on the portion of the taxable value of the property that

is not in dispute” (emphasis added). In its decision, the Court misinterpreted section

42.08 (b) (1) by failing to apply the phrase “not in dispute” to the phrase’s nearest and

last antecedent referent, “taxable value of the property”. Instead, the Court applied the

phrase “not in dispute” to the more remote phrase “the amount of taxes due”, stating

that “the owner must pay the lesser of: (1) the amount of taxes not in dispute….” Op.

at 5. If the Court had applied the phrase “not in dispute” to its last and nearest referent,

the Court would have had to apply the meaning given by the Legislature to the phrase

“taxable value”. “Taxable value” only means value; not value that an entity has

jurisdiction to tax. By failing to do so, the Court revised the statute and created an

exception of $-0- prepayment requirement in situs disputes, an exception which is

nowhere to be found in section 42.08.

       Moreover, if the phrase “amount of taxes due” was intended as a referent of the

phrase “not in dispute”, the Legislature would not have had to include the phrase

“taxable value of the property”. Necessarily, if the “taxable value” is in dispute so then

                                             iii
would be the “amount of taxes due”, making the phrase “taxable value” superfluous

and meaningless. In other words, it would have been sufficient to for the statute to state

exactly what the Court stated: “the amount of taxes not in dispute,” making the phrase

“taxable value” totally superfluous and meaningless. Op. at 5

       The Legislature’s policy is easily discernible from the text of Chapters 41, 41A

and 42 of the Tax Code as a whole. The policy is to prevent taxpayers from using the

judicial review as a subterfuge for delaying or avoiding the payment of taxes and to

assure that the activities of the local governments which rely on ad valorem taxes are

not unduly impeded during judicial review. When the tax statutes were enacted, the

Legislature was fully aware that there would be situs disputes. See Tex. Tax Code Ann.

§ 41.42 (West, Westlawnext through 2015 Sess.). But the Legislature chose to make no

exception to the prepayment requirement in situs disputes when it could have easily

done so. Whether section 42.08 ought to contain an exception to the prepayment

requirement in situs cases is a policy choice the Legislature has made.

       The Court’s decision paves the way for abuse of the use of judicial review as a

subterfuge for delaying or avoiding the payment of taxes in cases even where the situs

is clearly within the jurisdiction of the taxing district. This case is a prime example.

Whether the property the subject of this case is dealer’s heavy equipment inventory or

not has nothing to do with the clear situs of the equipment. In its decision, the Court

did not address Valerus Compression Services v. Gregg County Appraisal Dist., 457 S.W.3d 520

(Tex. App.-Tyler 2015, no pet.), which held that section 23.1241 (section dealing with

                                             iv
dealer’s heavy equipment inventory) has nothing to do with situs. The Court’s ruling

gives taxpayers an exception to the prepayment requirement not contained in section

42.08, so long as situs is in dispute. Therefore, any taxpayer may now include a claim of

improper situs in their protest, even if the claim lacks merit, and then appeal an adverse

ruling and the prepayment requirement would be $-0-. More gravely, the exception

created by the Court gives the taxpayer the ability to extend the delinquency date,

without paying a dime or incurring penalties or interest, for as long as the taxpayer can

keep the case in court. This case was filed in 2013 for taxes that would have become

delinquent in February 1, 2013, and there is still no delinquency date. It is obvious why

the Legislature decided not to create an exception of $-0- prepayment requirement in

situs disputes. If such an exception is read into section 42.08, every protest and appeal

will undoubtedly contain a situs dispute, regardless of merit.

                                            v
                                     ARGUMENT

I.     Under the doctrine of the “last antecedent”, the phrase “not in dispute”
       refers to value, the last and nearest antecedent, and not to the more remote
       phrase “the amount of taxes due”

       Section 42.08 (b) (1) does not provide for a payment of $-0- if the property owner

claims the property is not sitused in the taxing jurisidiction, nor does it provide, as held

by the Court, that “a taxpayer is required to pay only the lesser of the undisputed portion

of the taxes…” Op. at 6. Instead, the actual text of section 42.08 (b) (1) provides for a

payment of “the amount of taxes due on the portion of the taxable value of the property that

is not in dispute.” Tex. Tax Code Ann. § 42.08 (b) (1) (West, Westlawnext through 2015

Sess.) Under the doctrine of the “last antecedent,” relative and qualifying words,

phrases, and clauses are to be applied to the words or phrases immediately preceding,

and are not to be construed as extending to or including others more remote. Texas W.

Oaks Hosp., LP v. Williams, 371 S.W.3d 171, 184 (Tex. 2012). Here, the phrase “not in

dispute” refers to the “taxable value of the property” and not to the more remote phrase

“the amount of taxes due.” And, “taxable value” does not mean value that is subject to

the taxing entity’s jurisdiction to tax; it simply means value. Tex. Tax Code Ann. § 1.04

(10) (West, Westlawnext through 2015 Sess.) (when the Legislature has supplied its own

definition, as is the case here, the courts do not look at the ordinary or commonly

understood meaning; the courts are bound by the definition supplied by the Legislature.

Entergy Gulf States, Inc. v. Summers, 282 S.W.3d 433, 437 (Tex. 2009)).

                                             1
II.    Applying the phrase “not in dispute” to “the amount of taxes due” renders
       the phrase “taxable value” meaningless and superfluous

       Moreover, applying the phrase “not in dispute” to the phrase “the amount of

taxes due” would not make sense because it would render the phrase “taxable value of

the property” meaningless and superfluous, in violation of yet another cannon of

statutory construction. The courts must not interpret a statute in a manner that renders

any part of the statute meaningless or superfluous. Columbia Med. Ctr. of Las Colinas, Inc.

v. Hogue, 271 S.W.3d 238, 256 (Tex. 2008). If the phrase “amount of taxes due” was

intended as a referent of the phrase “not in dispute”, it would not have been necessary

to include the phrase “taxable value of the property” because if the “taxable value is in

dispute” so then would be the “amount of taxes due”, making the phrase taxable value

superfluous.

III.   Under the Court’s ruling, taxpayers will be able to extend the delinquency
       date, avoiding interest and penalties, without paying anything, simply by
       adding a situs dispute to their protest and appeal, regardless of merit; this
       is in direct contravention of the Legislature’s policy

       Also, in ascertaining the meaning of a statute, the courts must look, in addition

to the particular statutory language, to the language and design of the statutory scheme

as a whole. In re Ford Motor Co., 442 S.W.3d 265, 280 (Tex. 2014). There can be no

doubt that the meaning of the statue is that the delinquency date is not affected by a

protest or an appeal unless the taxpayer pays taxes on the value not in dispute. Tex. Tax

Code Ann. § 41.4115 (b), 41A.10 (a), 42.08 (a) (West, Westlawnext through 2015 Sess.)

                                            2
The Legislature’s policy is apparent from the text-to prevent taxpayers from using the

judicial review as a subterfuge for delaying or avoiding the payment of taxes and to

assure that the activities of the local governments which rely on ad valorem taxes are

not unduly impeded during judicial review. Palaniappan v. Harris Cnty. Appraisal Dist.,

No. 01-11-00344-CV, 2013 WL 6857983, at *4 (Tex. App.-Houston [1st Dist.] Dec. 31,

2013, no pet.) (not designated by publication). Of course, an owner who is unable to

pay the taxes while a protest or appeal is pending may be excused upon a showing of

inability to pay, but that is not the case here. Tex. Tax Code Ann. § 42.08 (d) (West,

Westlawnext through 2015 Sess.) The owner of the property who protests and appeals

is given the benefit of extending the delinquency date while the case is on appeal, so

long as the owner pays pay taxes on the value not in dispute. Tex. Tax Code Ann. § 42.08

(a) (West, Westlawnext through 2015 Sess.). Now, under the Court’s ruling, owners will

be able to pay $-0- by including a lack of situs claim, regardless of merit.

       The Legislature’s failure to make an exception of non-payment if the dispute is

situs is evident. An exception of payment of taxes for value not in dispute is understandable

because the owner is still required to make a payment. The Court’s ruling means that if

situs is one of the issues, the owner has to pay nothing while the case is on appeal. With

or without merit, anyone can contest situs and avoid paying anything, without accruing

penalties or interest, for as long as the owner can maintain the case in court. This

subterfuge in cases where the situs is clearly within the jurisdiction of the taxing district

can be used by any property owner. In this case, for example, whether the property is

                                             3
dealer’s heavy equipment inventory or not has nothing to do with the clear situs of the

equipment in Webb County. In Valerus Compression Services v. Gregg County Appraisal

District, 457 S.W.3d at 524-527, the court held that section 23.1241 (the section dealing

with heavy equipment inventory) is not a situs statue and it was never intended as such.

The Webb County Appraisal District has already made a determination that the

compressors are not dealer’s heavy equipment inventory and its value, a determination

that entails substantial inspection of the equipment’s characteristics located in its

jurisdiction. Obviously, the Legislature has made what it considers a wise policy choice

to prevent such kind of abuse by not allowing taxpayers to pay nothing and be in

compliance with the prepayment requirement of section 42.08.                The Court should

decline the taxpayers’ invitation to thwart the Legislature’s policy.

                            CONCLUSION AND PRAYER

       The Court must “take the Legislature at its word, respect its policy choices, and

resist revising a statute under the guise of interpreting it”, even if liberally. Christus Health

Gulf Coast v. Aetna, Inc., 397 S.W.3d 651, 654 (Tex. 2013). The words of the statute are

not ambiguous. Its plain meaning does not provide an exception of $-0- prepayment

requirement in cases involving allegations of improper situs. When the words of the

statute are unambiguous and yield but one interpretation, the judge’s inquiry is at end.

Id. UISD, therefore, prays that the Court reconsider its opinion and judgment of June

3, 2015, and affirm the judgment of the trial court.

                                               4
Respectfully submitted,

/s/ Alberto Alarcon
Alberto Alarcon
  State Bar No. 00968425
Paul C. Saenz
  State Bar No. 24013441
Guillermo G. Alarcon
  State Bar No. 00968410
ALARCON & SAENZ, PLLC
1302 Washington
Laredo, Texas 78040
Tel. (956) 727 8585
Fax. (956)727 8597
Email: aalarcon@sbcglobal.net

ATTORNEYS FOR THE UNITED
INDEPENDENT SCHOOL DISTRICT

  5
                          CERTIFICATE OF SERVICE

       I certify that on June 12, 2015, a true and correct copy of United Independent
School District’s Motion for Rehearing was served via the States’ E-filing system upon
the following counsel:

Evan A. Young
98 San Jacinto Blvd., Suite 1500
Austin, Texas 78701
Tel. (512) 322 2500
Fax. (512) 322 2501
Email: evan.young@bakerbotts.com

Paul R. Elliott
Benjamin A. Geslison
One Shell Plaza
910 Louisiana St.
Houston, Texas 77002
Tel. (713) 229 1241
Fax. (713) 229 2841
Email: paul.elliott@bakerbotts.com
Email: geslison@bakerbotts.com

Dylan Wood
Purdue, Brandon, Fielder, Collins & Mott L.L.P.
3301 Northland Drive, Suite 505
Austin, Texas 78731
Tel. (512) 302 0190
Fax. (512) 323 6963
Email: dwood@pbfcm.com

                                              /s/ Alberto Alarcon
                                              Alberto Alarcon

                                          6
                       CERTIFICATE OF COMPLIANCE

As required by Texas Rule of Appellate Procedure 9.4 (i) (3), I certify that this brief

complies with the type-volume limitation of Texas Rule of Appellate Procedure 9.4

(i)(2)(B) and 9.4(i)(1). The Brief contains 1909 words. The undersigned counsel certifies

that he relied upon the word count of the computer program used to prepare the

document. The undersigned counsel also certifies that this brief complies with the

typeface requirements of Texas Rule of Appellate Procedure 9.4(e). This brief has been

prepared in a proportionally spaced typeface in fourteen (14) point “Garamond” style

font for text.

                                               /s/ Alberto Alarcon
                                               Alberto Alarcon

                                           7