HomeMy WebLinkAboutAgenda 06-04-2019 8-f - Tax Refund Request – John C. Guibert III 1
ORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date: June 4, 2019
Action Agenda
Item No. 8-f
SUBJECT: Tax Refund Request— John C. Guibert III
DEPARTMENT: Tax Administration
ATTACHMENT(S): INFORMATION CONTACT:
John C. Guibert Refund Request Dwane Brinson, Tax Administrator,
Release/Refund Data Spreadsheet - (919) 245-2726
Guibert John Roberts, County Attorney, (919)
North Carolina General Statute 105-381 245-2518
Resolution
PURPOSE: To consider a resolution denying a refund request submitted by John C. Guibert III.
BACKGROUND: Mr. John C. Guibert submitted a refund request for his property at Lake
Orange for taxes overpaid from 2014 through 2018. The claim for this refund request is based
on the premise that (1) double taxation of the 615' to 620' elevation line has occurred and (2)
the Guiberts have been taxed for property they do not own based on an incorrect survey/plat
from the 1970's.
Mr. Guibert provided a new survey that was recorded February 2019, and the change in size of
the property and a resulting reduction in value which is effective for the 2020 tax bill. However,
the information provided is insufficient to support a refund of the prior years' taxes in accordance
with North Carolina state law.
In this situation, taxation has been conducted in strict adherence to North Carolina law, and in
accordance with the recorded plat/survey available at that time. The property ownership had
been determined by a recorded survey/plat from the 1970's, and based on that survey/plat, no
double taxation occurred during the years 2014 through 2018.
FINANCIAL IMPACT: Approval of the request would result in a $1,622.43 refund.
SOCIAL JUSTICE IMPACT: There is no Orange County Social Justice Goal impact associated
with this item.
RECOMMENDATION(S): The Manager recommends that the Board approve the attached
resolution denying the refund request based on consultation with the County Attorney.
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March 13, 2019
To: Donna Baker, Clerk to the Board of County Commissioners
From: John C. Guibert and Judith K. Guibert
Subject: Request for Property Tax Refund(CY 2014, 2015, 2016, 2017, 2018)
Reference: 4316 Arrowhead Trail; Hillsborough,NC 27278 (PIN# 9857757373)
Dear Ms. Baker:
The purpose of this document is to submit to the Orange County Board of County
Commissioners, in accordance with NC General Statute 105, a formal request for a tax refund for
the overcharge and overpayment of property taxes levied by Orange County for Property Tax
Years 2014, 2015, 2016, 2017, and 2018. (In this regard,we have assumed that the Board of
County Commissioners is the "Governing Body" for the Orange County Tax Unit.)
The property taxes in question are associated with the property owned by John C. Guibert and
Judith K. Guibert, which is located at 4316 Arrowhead Trail in Hillsborough,NC 27178 (PIN#
9857757373). We purchased this property in October 2002. It has been our primary residence
since September 2003.
We have also provided copies of this request to the following County personnel:
• Mr. T. Dwayne Brinson,Director of Tax Administration
• Mr. Chad Phillips, Deputy Tax Assessor
• Mr. Michael Burton, GIS Senior Project Coordinator
We thank you all, in advance, for your assistance in processing this request.
Best regards,
r
John C. Guibert Jith K. Guibert
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REQUEST FOR PROPERTY TAX REFUND
John C. Guibert and Judith K. Guibert
4316 Arrowhead Trail; Hillsborough,NC 27278 (PIN#9857757373)
March 13,2019
Purpose
The purpose of this document is to submit to the Orange County Board of County
Commissioners, in accordance with NC General Statute 105, a formal request for a tax refund for
the overcharge and overpayment of property taxes levied by Orange County for Property Tax
Years 2014, 2015, 2016, 2017, and 2018. (In this regard,we have assumed that the Board of
County Commissioners is the"Governing Body" for the Orange County Tax Unit.)
The property taxes in question are associated with the property owned by John C. Guibert and
Judith K. Guibert,which is located at 4316 Arrowhead Trail in Hillsborough,NC 27178 (PIN#
9857757373). We purchased this property in October 2002. It has been our primary residence
since September 2003.
Summary
• Due to a series of errors by multiple parties, including Orange County, ever since we
purchased this property in October 2002 we have been taxed for property that we did not
own. The undisputed owner of such property—Lake Orange Inc. —has also been taxed
for the property in question,thus"double taxation"has occurred for a long time and
continues to occur. Orange County staff has been aware of this situation for a very long
time.
• We learned of this situation in late July 2018 and immediately commenced action to
resolve it. These actions led to the conduct of a new survey of our property that was
recorded with the County on February 19, 2019.
• Based on that survey, we now know the exact amount/size of the land on our Lot
(Arrowhead Lot 10)that is owned by Lake Orange Inc. and NOT owned by us. The
amount/size of such land is 0.37 acres,which is19.5% of the total Arrowhead Lot 10 size
of 1.90 acres. This represents a 19.5%reduction in both the amount/size and the
valuation of the land that we have been taxed on up to this point.
• Based on this knowledge, we have calculated the amount of the property tax overbilling
and overpayment that we have experienced during the Tax Years 2014, 2015, 2016,
2017, and 2018 when we were billed/taxed as if we owned the above-mentioned 0.37
acres.
• The purpose of this letter is to formally request tax refunds for each of these five years.
• We understand that,by statute,we can only go back 5 years to obtain a refund for
overpayment of property tax bills. If that understanding is incorrect and we can go back
further,we request that we be informed so that we can augment this request.
• The total amount of tax refund requested=$1,658.15 for overbilling and overpayment in
tax years 2014-2018. Information on the calculation of this amount if presented herein.
• We are not sure if we are also entitled to payment of interest on these overpayments,but,
if so, we request such payment at the statutory rate of 6%.
Table 1 provides information on the calculated amounts of tax refunds requested for each year.
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REQUEST FOR PROPERTY TAX REFUND
John C. Guibert and Judith K. Guibert
4316 Arrowhead Trail; Hillsborough,NC 27278 (PIN#9857757373)
March 13,2019
Table 1
Information on the Calculated Amounts of Tax Refunds Requested
For CY 2014-2018
Tax Tax Due Tax Amount Statute of Corrected Amount of Tax
Year Date Billed&Paid Date Paid Limitations Tax Amount Refund Requested
Date
2014 9/1/2014 $4,992.04 11/18/2014 9/1/2019 $4,659.00 $333.04
2015 9/1/2015 $5,074.65 12/19/2015 9/1/2020 $4,738.82 $335.83
2016 9/1/2016 $5,179.46 10/17/2016 9/1/2021 $4,843.64 $335.82
2017 1 9/1/2017 $5,022.79 11/17/2017 9/1/2022 $4,698.28 $324.51
2018 9/1/2018 $5,093.69 11/6/2018 9/1/2023 $4764.74 $328.95
TOTAL $1,658.15
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REQUEST FOR PROPERTY TAX REFUND
John C. Guibert and Judith K. Guibert
4316 Arrowhead Trail; Hillsborough,NC 27278 (PIN#9857757373)
March 13,2019
Additional supporting information, background, and details
Many errors have been made related to the improper taxation of the land within the 615' and 620'
elevation levels on Arrowhead Lot 10 including"clerical errors"—either in the plain meaning or the
euphemistic use of that term. As indicated below, both the original owner of the Arrowhead subdivision
and Orange County are party to these errors.
Orange County has knowingly taxed both Lake Orange Inc. and the Arrowhead Lot 10 Owners for the
same piece of land on Arrowhead Lot 10, specifically the land within the elevation contours 615' and
620'. Orange County has long known that Lake Orange Inc. is the owner of this land! This situation is
in conflict with a fundamental axiom of property law: "one cannot be taxed for property that one does
not own."Furthermore, Orange County has failed to directly inform/notify affected property owners of
this"double taxation" situation,thereby contributing directly to the continuation of this situation for
several decades. We believe that may constitute an illegal tax.
Errors were made in the Plat recorded for the creation of the Arrowhead Subdivision on 12/14/1976
(Plat Book 26,Page 73)through a combination of omissions and clerical errors. These omissions and
errors resulted in an incorrect representation that Mr. &Mrs. Robert Nichols were the owners of"All of
the land of Lot Number 10 of Arrowhead subdivision as shown on the plat of Arrowhead,property of R.
B.Nichols,recorded at Plat Book 26,Page 73, Orange County Registry." This appears to constitute a
conflict with another fundamental axiom of property law: "one cannot convey that which one does not
own."
x
Orange County was at the time and is now well aware that this is an incorrect representation, and that
Lake Orange Inc. is the true owner of the land within the 615' and 620' elevation levels on Arrowhead
Lot 10, as well as being the true owner of such land on all the other Arrowhead Lots not to mention all
the other Lots within other subdivisions around Lake Orange. The County has been aware of this for a
very long time.
Yet,with a few exceptions, Orange County continues to use the erroneous Plat Book 26,Page 73 for the
determination of ownership (and thereby taxation) of Arrowhead Lots. The few exceptions are Lot 5,
Lot 10, and Lot 11, in which cases individual owners (including the Guiberts for Arrowhead Lot 10)
discovered on their own that they were being subjected to taxation for land they did not own and then
took action(conducted new surveys and recorded plats)to begin the process of correcting these errors.
There is evidence that by the early 1980s (if not sooner),Mr. &Mrs. Nichols were aware of the errors in
the above-mentioned Plat for the creation of the Arrowhead subdivision. In the early to middle 1980s (at
the time ownership in Arrowhead Lots was being conveyed by the Nichols to the first buyers of those
Lots), a new Plat was typically included as Appendix A to the General Warranty Deed for the
sale/conveyance. For Arrowhead Lot 10,the initial sale/conveyance of the Lot to the first purchasers of
the Lot took place on 2/21/1986 (Deed Book 558, Pages 625-627,with the new Plat shown on Page
627).
I In 1967,as an essential part of the creation of Lake Orange,Lake Orange Inc. conveyed to Orange County all of the land it
owned below the 615' elevation contour line around what is now known as Lake Orange. (Deed Book 212,Page 362 and Plat
Book 16,Page 12).As described/shown in both that Deed and the associated Plat,Lake Orange Inc.retained ownership of
the land around Lake Orange within the 615' and 620'elevation contour lines.In that Deed,Orange County specifically
obtained the right of first refusal of any proposed transfer of ownership of that land by Lake Orange Inc.
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REQUEST FOR PROPERTY TAX REFUND
John C. Guibert and Judith K. Guibert
4316 Arrowhead Trail; Hillsborough,NC 27278 (PIN#9857757373)
March 13,2019
This Plat showed:
• Elevation contours for both the 615' and 620' elevations
• That,the land existing within those contours was 0.30 acres in size
• That the land existing above elevation contour 620' was 1.60 acres in size
• That the total land shown for Lot 10 was 1.90 acres in size.
This appears to have been a good faith attempt to resolve any current or future questions regarding the
ownership and taxation of the land within the 615' and 620' elevation levels on Arrowhead Lot 10. This
Plat was apparently"rejected"by County staff—apparently due to insufficient level of detail or other
errors made (clerical or otherwise)by the surveyor and/or the recorder of the Plat. As a result,the Plat of
record remained the erroneous Plat Book 26, Page 73 mentioned above. It appears that similar
"rejections"were made for the similarly conducted and recorded Plats for all of the Arrowhead
Subdivision Lots.
It is not known what efforts, if any,the County made to ensure that such rejections and the reasons for
the rejections were communicated to the buyers of Arrowhead Lot 10 or to the buyers of any of the other
Arrowhead Lots, along with information on what was needed to correct the situation. As buyers of Lot
10 in October, 2002, we can attest that we were not aware of the fact that we were inheriting a situation
where we were knowingly being taxed for land we did not own. Quite frankly, we were naive enough to
believe that such a thing could not happen in the United States of America.
It is difficult to understand why the County decided to continue to place more weight on the use of the
already known to be erroneous Plat recorded in Plat Book 26, Page 73 rather than on the subsequent
Plats recorded in the mid-1980s, all of which—though described by County staff as being somewhat
imperfect—were nonetheless more complete and accurate with respect to delineation of ownership than
the older Plat. Those subsequently recorded Plats appear to have been a significant improvement in that
they provided a reasonable basis for quantifying the amount of land on the Arrowhead Lots that was
owned by Lake Orange Inc. In addition, continuation of the use of the original Arrowhead subdivision
Plat appears to be in conflict with one of the general axioms of property law: "One cannot convey that
which one does not own."
Having become clearly aware of these ownership &"double taxation"issues in July/August,2018, John
and Judith Guibert acted as quickly as possible to resolve this matter once and for all by conducting and
recording a new survey/survey plat for Arrowhead Lot 10. (As an aside, availability of surveyors is low
and resulted in our inability to take this action as promptly as we desired.) The new survey was
conducted on January 23, 2019 and was recorded on February 19, 2019 (Plat Book 119, Page 191). The
new Plat shows:
• Elevation contours for both the 615' and 620' elevations
• That,the land within those contours is 16,084 SF (0.37 acres) in size
• That the land existing above elevation contour 620' is 66,780 SF(1.53 acres) in size
• That the total land shown for Lot 10 is 1.90 acres in size.
This survey and recorded Plat have been accepted by the County as acceptable for both land ownership
and taxation purposes.
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REQUEST FOR PROPERTY TAX REFUND
John C. Guibert and Judith K. Guibert
4316 Arrowhead Trail; Hillsborough,NC 27278 (PIN#9857757373)
March 13,2019
With this new survey plat now available, it has become possible to precisely uq antifthe amount of land
on Arrowhead Lot 10 that is owned by Lake Orange Inc. and to dis ositively separate that land from the
land owned by John C. Guibert& Judith K. Guibert—for any and all purposes, including property
taxation by Orange County.
The amount of land on Arrowhead Lot 10 existing within the 615' and 620' elevation contour levels is
equal to 16,084 SF (0.37 acres). This represents 19.5% of the total land of Arrowhead Lot 10.
In order to calculate the amount of the overbilling&overpayment of property tax for the years 2014-
2018,the valuation of the land actually owned by John& Judith Guibert was calculated as 80.5%of the
previous valuation of all the land on Lot 10. In this regard, it was assumed that all of the land on Lot 10
was of equal value, which we believe to be standard practice for Orange County staff. The ad valorem
tax rates in effect for each tax year were used, along with any fixed cost tax assessments,to calculate the
amount of tax that should have been paid based on an accurate reflection of land ownership on
Arrowhead Lot 10. The results are presented in Table 1 above.
John C. Guibert udith K. Guibert
Guibert Contact Information
John C. &Judith K. Guibert
4316 Arrowhead Trail
Hillsborough,NC 27278
(919) 357-2095 John's cell
(919) 357-2096 Judith's cell
(919) 732-2385 landline
j uig bertnmindspring_com John's e-mail
jkguibert@msn.com Judith's e-mail
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Illegal tax G.S. 105-381(a)(1)(b) BOCC REPORT - REAL/PERSONAL
JUNE 49 2019
ACCOUNT BILLING ORIGINAL ADJUSTED FINANCIAL
NAME NUMBER YEAR VALUE VALUE IMPACT REASON FOR DENIAL
Guibert, John C III 261146 2018 512,000 482,000 (282.57)
Guibert, John C III 261146 2017 512,000 482,000 (278.76)
Information provided is insufficient to support a refund of this tax in
Guibert, John C III 261146 2016 506,647 469,737 (354.93) accordance with North Carolina State Law.
Guibert, John C III 261146 2015 506,647 469,737 (354.93)
Guibert, John C III 261146 2014 506,647 469,737 (351.24)
(1,622.43) Total
The spreadsheet represents the financial impact that approval of the requested release or refund would have on the principal amount of taxes.
Approval of the release or refund of the principal tax amount also constitutes approval of the release or
refund of all associated interest, penalties,fees, and costs appurtenant to the released or refunded principal tax amount.
May 4, 2019 thru May 15, 2019
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§ 105-381. Taxpayer's remedies.
(a) Statement of Defense. — Any taxpayer asserting a valid defense to the enforcement
of the collection of a tax assessed upon his property shall proceed as hereinafter provided.
(1) For the purpose of this subsection, a valid defense shall include the
following:
a. A tax imposed through clerical error;
b. An illegal tax;
C. A tax levied for an illegal purpose.
(2) If a tax has not been paid, the taxpayer may make a demand for the release
of the tax claim by submitting to the governing body of the taxing unit a
written statement of his defense to payment or enforcement of the tax and a
request for release of the tax at any time prior to payment of the tax.
(3) If a tax has been paid, the taxpayer, at any time within five years after said
tax first became due or within six months from the date of payment of such
tax, whichever is the later date, may make a demand for a refund of the tax
paid by submitting to the governing body of the taxing unit a written
statement of his defense and a request for refund thereof.
(b) Action of Governing Body. — Upon receiving a taxpayer's written statement of
defense and request for release or refund, the governing body of the taxing unit shall within 90
days after receipt of such request determine whether the taxpayer has a valid defense to the tax
imposed or any part thereof and shall either release or refund that portion of the amount that is
determined to be in excess of the correct tax liability or notify the taxpayer in writing that no
release or refund will be made. The governing body may, by resolution, delegate its authority to
determine requests for a release or refund of tax of less than one hundred dollars ($100.00) to
the finance officer, manager, or attorney of the taxing unit. A finance officer, manager, or
attorney to whom this authority is delegated shall monthly report to the governing body the
actions taken by him on requests for release or refund. All actions taken by the governing body
or finance officer, manager, or attorney on requests for release or refund shall be recorded in
the minutes of the governing body. If a release is granted or refund made, the tax collector shall
be credited with the amount released or refunded in his annual settlement.
(c) Suit for Recovery of Property Taxes. —
(1) Request for Release before Payment. — If within 90 days after receiving a
taxpayer's request for release of an unpaid tax claim under (a) above, the
governing body of the taxing unit has failed to grant the release, has notified
the taxpayer that no release will be granted, or has taken no action on the
request, the taxpayer shall pay the tax. He may then within three years from
the date of payment bring a civil action against the taxing unit for the
amount claimed.
(2) Request for Refund. — If within 90 days after receiving a taxpayer's request
for refund under (a) above, the governing body has failed to refund the full
amount requested by the taxpayer, has notified the taxpayer that no refund
will be made, or has taken no action on the request, the taxpayer may bring a
civil action against the taxing unit for the amount claimed. Such action may
be brought at any time within three years from the expiration of the period in
which the governing body is required to act.
(d) Civil Actions. — Civil actions brought pursuant to subsection (c) above shall be
brought in the appropriate division of the general court of justice of the county in which the
taxing unit is located. If, upon the trial, it is determined that the tax or any part of it was illegal
or levied for an illegal purpose, or excessive as the result of a clerical error,judgment shall be
G.S. 105-381 Page 1
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rendered therefor with interest thereon at six percent (6%) per annum, plus costs, and the
judgment shall be collected as in other civil actions. (1901, c. 558, s. 30; Rev., s. 2855; C. S., s.
7979; 1971, c. 806, s. 1; 1973, c. 564, s. 3; 1977, c. 946, s. 2; 1985, c. 150, s. 1; 1987, c. 127.)
G.S. 105-381 Page 2
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NORTH CAROLINA RES-2019-036
ORANGE COUNTY
REFUND RESOLUTION(Denial)
Whereas,North Carolina General Statutes 105-381 allows for the refund of taxes when the Board
of County Commissioners determines that a taxpayer applying for the refund has a valid defense to the tax
imposed;and
Whereas,the properties listed in the attached"Refund Request"has been taxed and the tax has
been collected: and
Whereas,as to the property listed in the Refund Request,the taxpayer has timely applied in
writing for a refund of the tax imposed but has not presented a valid defense to the tax imposed as indicated
on the Request for Property Tax Refunds.
NOW,THEREFORE,IT IS RESOLVED BY THE BOARD OF COUNTY
COMMISSIONERS OF ORANGE COUNTY THAT the property tax refund recommended for denial
are denied.
Upon motion duly made and seconded,the foregoing resolution was passed by the following votes:
Ayes: Commissioners
Nayes:
I,Donna Baker,Clerk to the Board of Commissioners for the County of Orange,North Carolina,
DO HEREBY CERTIFY that the foregoing has been carefully copied from the recorded minutes of the
Board of Commissioners for said County at a regular meeting of said Board held on
,said record having been made in the Minute Book of the minutes of said Board,
and is a true copy of so much of said proceedings of said Board as relates in any way to the passage of the
resolution described in said proceedings.
WITNESS my hand and the corporate seal of said County,this day of
Clerk to the Board of Commissioners