Court Opinion

ID: 6793499
Source: CourtListenerOpinion
Date Created: 2022-07-21 01:14:30.02613+00
Date Added: 2024-06-11T16:03:05.319746
License: Public Domain

Lundberg Stratton, J.,
concurring.
{¶ 38} I agree with the decision to remand this case on the failure of HealthSouth to provide sufficient documentation of its assets to justify a refund.
{¶ 39} I also reluctantly agree that the language of R.C. 5711.26, as amended in 1982, now appears to require the commissioner to issue such a refund by removing the commissioner’s discretion in such cases. While the majority laments the loss to the “innocent investors” caused by the corporate fraud, I believe that the government and taxing districts are also primary victims of the fraud. While the taxing districts may have temporarily benefited from the overpayment of taxes by HealthSouth (and therefore presumably adjusted their budgets to reflect the extra income), those same taxing districts, if a refund is upheld on remand, will now be forced, in these very difficult economic times, to come up with funds to repay those tax benefits received. And what is worse, those funds will go back to a corporation that has admitted to massive fraud.
{¶ 40} But since the law seems to tie our hands, these are policy arguments that should be directed to the General Assembly so that it may consider changing the statute. Both Alabama in Ex parte HealthSouth Corp. (Ala.2007), 978 So.2d 745, and Connecticut in HealthSouth Corp. v. Waterbury (Mar. 13, 2008), Conn.Super. Nos. CV054011048, CV054010916, CV054010807, CV054002794, and CV054006234, 2008 WL 853304, denied refunds to HealthSouth, in cases almost identical to the one before us now, because of the language of their statutes and the discretion afforded their tax officials in cases of fraud.
{¶ 41} Therefore, I reluctantly agree that the Ohio tax statute does not prohibit refunds based on fraud, but agree that the matter should be remanded for further proof on the merits.
Lanzinger, J., concurs in the foregoing opinion.