Appellate Division, Second Department, holds that a failure to check the correct box on a grievance complaint form was not fatal to petitioner’s request for the restoration of a property tax exemption.


In Culinary Arts Riverhead, LLC v. Assessor of Town of Riverhead, --- N.Y.S.3d ---- , 2023 WL 3328826 (2d Dep’t May 10, 2023), the petitioner, pursuant to a 2007 sale/lease back agreement, leased property in Riverhead from the the Suffolk County Industrial Development Agency (“IDA”). Petitioner therein subleased the property to Suffolk County Community College (“College”) for the college’s culinary arts program. The property was tax exempt pursuant to General Municipal Law § 874 and Real Property Tax Law § 412–a, and, pursuant to a 2007 agreement with the IDA and the College, the petitioner was required to make certain payments in lieu of taxes (“PILOT payments”). In May 2018, the Town’s Board of Assessors revoked the property’s tax-exempt status on the basis that the petitioner failed to make PILOT payments, which permitted the IDA to convey the property back to the petitioner (which conveyance did not occur).

The petitioner filed a grievance complaint using the preprinted RP-524 complaint form, wherein it checked the boxes for “misclassification” as well as “unequal” and “excessive” assessment. However, the petitioner did not check the box for “unlawful” assessment, which category encompasses a claim that a property’s tax exemption was unlawfully revoked. The Town Board of Assessor denied the grievance, and the petitioner filed an Article 7 petition. Soon after, the petitioner moved for summary judgment, and the Town’s Assessor, the Town’s Board of Assessors, the Town’s Board of Assessment Review, and the Town cross-moved for summary judgment dismissing the petition on the ground that the petitioner did not check the box on the grievance complaint form which would indicate that it was asserting that the assessment was unlawful. The Supreme Court granted the petitioner’s motion, denied the respondents’ cross-motion, and directed the removal of the property from the taxable portion of the assessment roll and the return of taxes paid on the property for the year under review. The Appellate Division, Second Department, affirmed the lower court’s judgment, stating:

“Contrary to the appellants’ contention, the mere failure to check the box on the grievance complaint form which would indicate that the petitioner was asserting that the assessment was unlawful does not foreclose the petitioner from challenging the revocation of the property’s tax exempt status. Sufficient facts were submitted to the Town’s Board of Assessment Review to enable it to review the validity of the tax assessment and whether the revocation of the property’s tax exempt status was proper (see Matter of DCH Auto v. Town of Mamaroneck, 38 N.Y.3d 278, 297 [2022]). Further, the failure to check the appropriate box did not result in any prejudice to the appellants.”

This is a welcome decision for all petitioners located in the Second Judicial District, as the Second Department expressly acknowledged that ‘“[t]he Tax Law relating to review of assessments is remedial in character and should be liberally construed to the end that the taxpayer’s right to have his [or her] assessment reviewed should not be defeated by a technicality’” Id. (quoting People ex rel. New York City Omnibus Corp. v. Miller, 282 N.Y. 5, 9, [1939]), and in so finding, it put substance over form to reach what we believe was the correct result.