                   IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Robert M. Kerr,                                   :
                                  Petitioner      :
                                                  :
                        v.                        :
                                                  :
Commonwealth of Pennsylvania,                     :   No. 158 F.R. 2012
                     Respondent                   :   Submitted: April 11, 2018


BEFORE:          HONORABLE MARY HANNAH LEAVITT, President Judge
                 HONORABLE ROBERT SIMPSON, Judge
                 HONORABLE PATRICIA A. McCULLOUGH, Judge
                 HONORABLE ANNE E. COVEY, Judge
                 HONORABLE MICHAEL H. WOJCIK, Judge
                 HONORABLE CHRISTINE FIZZANO CANNON, Judge
                 HONORABLE ELLEN CEISLER, Judge


OPINION BY
JUDGE COVEY                                           FILED: May 7, 2018

                 Robert M. Kerr (Kerr) filed exceptions pursuant to Pennsylvania Rule of
Appellate Procedure (Rule) 1571(i)1 to this Court’s July 6, 2017 order affirming the
Board of Finance and Revenue’s (Board) January 25, 2012 order sustaining the Board
of Appeals’ (Appeals Board) dismissal of Kerr’s Petition for Reassessment (Petition)
(Exceptions).        The sole issue before the Court is whether the Court erred by



       1
           Rule 1571(i) states:

                 Any party may file exceptions to an initial determination by [this
                 C]ourt under this rule within 30 days after the entry of the order to
                 which exception is taken. Such timely exceptions shall have the
                 effect, for the purposes of Rule 1701(b)(3) (authority of lower court
                 or agency after appeal) of an order expressly granting reconsideration
                 of the determination previously entered by the court. Issues not raised
                 on exceptions are waived and cannot be raised on appeal.
Pa.R.A.P. 1571(i).
concluding that Kerr’s Petition was untimely filed.2 After review, we overrule Kerr’s
Exceptions.
               The procedural posture of this case is undisputed. See Stipulation of
Facts (Stipulation).3 By April 7, 2009 notice, the Commonwealth of Pennsylvania
Department of Revenue (Department) assessed taxes, penalties and interest on
income Kerr, a Georgia resident, derived from his investment in PSMK Associates, a
Pennsylvania limited partnership (Assessment Notice).4 See Stip. ¶ 3; see also Stip.
Ex. H. The Department sent the Assessment Notice to Kerr by certified mail at 1126
Shoreline Drive, Jefferson, Georgia. See Stip. Ex. H. A bar code and certified
mailing number 7179 0771 4430 9024 3503 appear at the top of the Assessment
Notice and next to the number are the words “Certified Mail Number.” See Stip. Ex.
H. The Assessment Notice contained the following instructions:

               YOU HAVE THE RIGHT TO APPEAL FOR A REASSESSMENT
               OR REFUND. DETAILS OF YOUR APPEAL RIGHTS ARE
               ENCLOSED (SEE REV-554). . . . A TAXPAYER DISAGREEING
               WITH THE ASSESSMENT OF TAX MUST FILE A PETITION
               FOR REASSESSMENT OR REFUND. APPEALS MUST BE
               FILED BY THE FOLLOWING DATE: 1) ON OR BEFORE JULY
               06 2009 A PETITION FOR REASSESSMENT MUST BE FILED

       2
           Kerr’s Exceptions primarily challenge the merits of the Department’s underlying
assessment, and only briefly address the Petition’s timeliness. At the June 5, 2017 oral argument
before this Court, Kerr’s counsel represented that Kerr’s sole contention on appeal relative to
timeliness is that the Assessment Notice was not sent by certified mail. In Kerr’s reply brief filed
with this Court in his original appeal (Original Reply Brief), Kerr asserted that the certified mailing
number without a Postal Service Form PS 3800 is insufficient to prove that Kerr received the
Assessment Notice. See Kerr Original Reply Br. at 10-11. Notably, Kerr does not make that
specific argument in his Exceptions. See Exceptions ¶ 11(j); see also Exceptions Br. at 10, 13.
        3
          Kerr filed a proposed stipulation of facts on December 30, 2016. After amendment, on
May 15, 2017, the parties agreed upon the Stipulation.
        4
          In the Commonwealth’s April 27, 2017 Application for Relief to amend Kerr’s proposed
stipulation of facts (Application for Relief), the Commonwealth represented that Exhibit H
(formerly Commonwealth Exhibit B), is “a true and correct copy of the [Assessment Notice] issued
on April 9, 2009 by certified mail.” July 6, 2017 memorandum opinion at 3. Kerr did not oppose
the Commonwealth’s requested amendment. See id. at 3. This Court granted the Commonwealth’s
Application for Relief, thereby making that representation a stipulated fact. See id. at 3-4.
                                                  2
              OR 2) ON OR BEFORE OCT 07 2009 REMIT THE BALANCE
              DUE TO THE [DEPARTMENT] AND FILE A PETITION FOR
              REFUND.     APPEALS ARE CONSIDERED TIMELY IF
              POSTMARKED BY THE U.S. POSTAL SERVICE ON OR
              BEFORE THE LAST DAY FOR PETITIONING FOR
              REASSESSMENT OR REFUND OR IF RECEIVED AT THE
              ADDRESS BELOW ON OR BEFORE THE LAST DAY FOR
              PETITIONING FOR REASSESSMENT OR REFUND.

Stip. Ex. H. at 3 (emphasis added).
              Kerr filed the Petition with the Appeals Board on March 25, 2011. See
Stip. ¶ 6. The Appeals Board dismissed the Petition because it was not timely filed.
Kerr appealed from that decision to the Board. By January 25, 2012 order, the Board
sustained the Appeals Board’s decision. Kerr appealed to this Court.5 On July 6,
2017, this Court affirmed the Board’s order. Kerr timely filed the Exceptions which
are now before this Court en banc.6
              Kerr argues in his brief in support of his Exceptions (Exceptions Brief)
that Section 338(a) of the Tax Reform Code of 1971 (Code),7 requires that the


       5
              In appeals from determinations of the [Board], this Court essentially
              acts as a trial court and exercises the broadest scope of review. Our
              standard of review is de novo. The stipulation of facts entered into by
              the parties is binding on them, although the Court may draw its own
              legal conclusions.
Luther P. Miller, Inc. v. Commonwealth, 88 A.3d 304, 308 n.5 (Pa. Cmwlth. 2014) (citations
omitted).
              ‘Our scope of review in tax appeals is . . . limited to the construction,
              interpretation and application of a State tax statute to [the] given set
              of facts.’ United Servs. Auto. Ass’n v. Commonwealth, . . . 618 A.2d
              1155, 1156 ([Pa. Cmwlth.] 1992) (quoting Escofil v. Commonwealth,
               . . . 406 A.2d 850, 852 ([Pa. Cmwlth.] 1979), aff’d per curiam, . . .
              452 A.2d 1012 ([Pa.] 1982)).
Downs Racing, LP v. Commonwealth, 174 A.3d 1174, 1175 n.4 (Pa. Cmwlth. 2017).
       6
         “[E]xceptions filed pursuant to [Rule] 1571(i) have the effect of an order granting
reconsideration.” Kalodner v. Commonwealth, 636 A.2d 1230, 1231 (Pa. Cmwlth. 1994), aff’d, 675
A.2d 710 (Pa. 1995).
       7
         Act of March 4, 1971, P.L. 6, as amended, added by Section 4 of the Act of August 31,
1971, P.L. 362, 77 P.S. § 7338(a).
                                              3
Assessment Notice be sent by certified mail and, since the Assessment Notice was
not stamped with a certified mail tracking number, “[i]f the Commonwealth cannot
produce this number, then the [Assessment Notice] is void and . . . should be set
aside” because it “may never have been mailed.”      Exceptions ¶ 11(j); see also Kerr
Exceptions Br. at 10, 13; Kerr Original Br. at 10, 13. In support of his position, Kerr
stated that “he never received the [A]ssessment [Notice],” and “he did not learn of [it]
until liens were filed.” Stip. ¶ 4. This position is the identical argument Kerr made in
his original appeal to this Court.
             In concluding that Kerr’s Petition was late-filed, this Court observed that
the Assessment Notice was sent to Kerr’s record address in Georgia and, despite that
the Commonwealth did not produce a stamped post office receipt, the Assessment
Notice clearly contains a certified mailing number. See Stip. Ex. H. Moreover,
shortly after the Assessment Notice was mailed, the Department received an April 30,
2009 letter from certified public accountant, Paul Frederick Kelly (Kelly), wherein
Kelly stated: “[Kerr] is not aware of any taxable issues that would create [the
Assessment Notice] and believes this [Assessment Notice] is in error. Please provide
[Kerr] a copy of the document you used to prepare [the Assessment Notice].” Stip.
Ex. I; see also Stip. ¶ 5. Kelly’s letter reflects that it was copied to Kerr. See Stip.
Ex. I. By June 10, 2009 letter, sent by certified mail to Kerr at 1126 Shoreline Drive,
Jefferson, Georgia, the Department’s Pass Through Business Office explained its
assessment. See Stip. Ex. J; see also Stip. ¶ 5. The Department’s June 10, 2009 letter
further specified:

             If you should disagree with the adjusted tax liability,
             you must file a petition for reassessment or refund. The
             specific filing deadlines are printed on the assessment.




                                           4
             Please review the attached Preservation of Appeal Rights[8]
             that explains that even if you contact the [Department]
             after you receive the assessment your time to appeal to
             the [Appeals Board] is still running. More information on
             filing     an      appeal     can     be     found      at
             www.boardofappeals.state.pa.us[.]

See Stip. Ex. J (emphasis added). The return receipt reflects that Kerr received the
Department’s June 10, 2009 letter on June 12, 2009, at the same address where the
Department’s April 2009 Assessment Notice was mailed. See Stip. Ex. J at 4. Kerr
filed the Petition on March 25, 2011. See Stip. ¶ 6.
             The Board made the following findings in its Statement of the Case:

             [Kerr] contacted the Department on August 19, 2009 and
             October 21, 2009 regarding the assessment of 2006 tax due.
             Department records show that a member of the Pass-
             Through Business Office spoke to [Kerr] on October 22,
             2009, during which [Kerr] indicated that he did not receive
             the Department’s [A]ssessment [N]otice. The Department
             then informed [Kerr] of his right[] to appeal the assessment
             to the [Appeals Board] and resent [sic] the June 2009 letter
             explaining the assessment appeal process to an email
             address provided by [Kerr].

Board Dec. at 2.        In addition, the Board found: “[Kerr] was notified of the
jurisdictional issue by letter dated October 18, 2011. [Kerr] has not responded to
date.” Board Dec. at 1. Notably, Kerr did not take issue, either in the Stipulation or
his briefs to this Court, with the Board’s findings. Rather, he claimed only that he did
not receive the Assessment Notice and the Department could not prove otherwise.
             Notwithstanding, this Court explained in its July 6, 2017 memorandum
opinion (Opinion), that Section 338(c) of the Code9 states, in pertinent part: “A notice
of assessment in the estimated amount shall be sent to the taxpayer.” 72 P.S. §
7338(c). Section 338(d) of the Code10 declares that an assessment notice “shall be

      8
        The Preservation of Appeal Rights was not included in the record filed with this Court.
      9
         Added by Section 4 of the Act of August 31, 1971, P.L. 362.
      10
         Added by Section 10 of the Act of October 18, 2006, P.L. 1149.
                                                5
mailed to the taxpayer.” 72 P.S. § 7338(d). Neither provision requires that the
Assessment Notice be sent by certified mailing. Where the General Assembly has
mandated certified mailing, it has specified that requirement in the pertinent tax
statute.    See Section 602(e)(1) of the Real Estate Tax Sale Law,11 72 P.S. §
5860.602(e)(1) (a tax sale notice shall be given “by United States certified mail,
restricted delivery, return receipt requested, postage prepaid[.]”). Further, “‘[t]he
mailbox rule creates a rebuttable presumption that an item which is properly mailed
will be received; the presumption cannot be nullified by only an assertion that the
item was not received.’ C.E. v. Dep’t of Pub. Welfare, 97 A.3d 828, 832 (Pa.
Cmwlth. 2014).” Estate of Wilson by Killinger v. State Employees’ Ret. Bd., 177
A.3d 1020, 1024 n.5 (Pa. Cmwlth. 2017).
              In addition, Section 338(c) of the Code mandates that “[t]he tax shall be
paid within ninety days after a notice of such estimated assessment has been mailed
to the taxpayer, unless within such period the taxpayer has filed a petition for
reassessment . . . .”12       72 P.S. § 7338(c) (emphasis added).              At the time the
Department’s Assessment Notice was issued, Section 2702(a) of the Code provided:13
“A taxpayer may file a petition for reassessment with the [D]epartment within 90
days after the mailing date of the [Assessment Notice].”                    72 P.S. § 9702(a)
(emphasis added). Accordingly, Kerr was required either to pay the assessed
taxes or file the Petition within 90 days of the Assessment Notice’s date – by July
6, 2009 – which the Assessment Notice clearly specified. See Stip. Ex. H. at 3.




       11
            Act of July 7, 1947, P.L. 1368, as amended, 72 P.S. §§ 5860.101-5860.803.
       12
            Kerr’s representation notwithstanding, Section 338(a) of the Code merely authorizes the
Department “to make the inquiries, determinations and assessments of all taxes imposed by this
article.” 77 P.S. § 7338(a).
         13
            Added by Section 28 of the Act of October 18, 2006, P.L. 1149. The 90-day appeal
period was amended to 60 days by Section 44 of the Act of October 30, 2017, P.L. 672.
                                                6
             Kerr did not file the Petition until March 25, 2011 - nearly two years
(23 months and 19 days) later. See Stip. ¶ 6. Although there is no certified mailing
receipt in this record to prove when Kerr received the Assessment Notice, since
Section 338 of the Code does not expressly require certified mailing, its absence in
this case is not a Code violation. In addition, notwithstanding Kerr’s claim that he
did not receive the Assessment Notice, it is clear from the unchallenged facts that
Kelly made inquiries about the assessment on Kerr’s behalf, and purportedly
with Kerr’s knowledge, only three weeks after the Assessment Notice was issued.
The Department’s June 10, 2009 response to Kelly’s letter again instructed Kerr
about his appeal rights while he still had one month in which to timely challenge
the Assessment Notice, but he failed to do so. Moreover, although Kerr contacted
the Department on August 19 and October 21, 2009 to discuss the Assessment
Notice, it was not until October 22, 2009 that he first claimed to the Department
that he had not received the Assessment Notice. Despite having, once again, been
advised of his appeal rights on October 22, 2009, Kerr waited nearly another 1½
years before filing the Petition.     Kerr provides no record explanation for the
extensive delay, other than that he did not receive the Assessment Notice, which
claim is belied by the undisputed facts.
             This Court observed in its Opinion, that the law is well-settled that the
Code’s time limitations are to be strictly enforced. Quest Diagnostics Venture, LLC
v. Commonwealth, 119 A.3d 406 (Pa. Cmwlth. 2015), aff’d, 148 A.3d 448 (Pa. 2016).
“It is also well established that neither the Board nor this Court has power to alter the
explicit time limitation set forth in the [Code] based on equitable principles.” Phila.
Gas Works v. Commonwealth, 741 A.2d 841, 846-47 (Pa. Cmwlth. 1999), aff’d, 757
A.2d 360 (Pa. 2000). We find no error in this Court’s conclusions.




                                           7
            Clearly,

            [Kerr’s] [E]xceptions . . . raise precisely the same issues
            that [he] raised in [his] initial appeal.
            ....
            After reviewing our previous [O]pinion and revisiting the
            arguments [Kerr] presented in [his] briefs and at [the June
            5, 2017] oral argument, we concur with both the result and
            the reasoning of this Court’s [Opinion]. None of the
            authority cited by [Kerr] changes our conclusion or the
            rationale of that [O]pinion.
            Accordingly, we [overrule] [Kerr’s] [E]xceptions.

Kalodner v. Commonwealth, 636 A.2d 1230, 1231-32 (Pa. Cmwlth. 1994) (citation
omitted; emphasis added), aff’d, 675 A.2d 710 (Pa. 1995).
            For all of the above reasons, the Exceptions are overruled.


                                      ___________________________
                                      ANNE E. COVEY, Judge




                                         8
            IN THE COMMONWEALTH COURT OF PENNSYLVANIA


Robert M. Kerr,                        :
                        Petitioner     :
                                       :
                  v.                   :
                                       :
Commonwealth of Pennsylvania,          :   No. 158 F.R. 2012
                     Respondent        :


                                     ORDER

            AND NOW, this 7th day of May, 2018, the exceptions filed by Robert M.
Kerr to this Court’s July 6, 2017 opinion and order are OVERRULED, and the Chief
Clerk is directed to enter judgment in the Commonwealth of Pennsylvania’s favor.


                                     ___________________________
                                     ANNE E. COVEY, Judge
