Appeal of Keith R. Mader 2000 Revocable Trust & a.

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THE SUPREME COURT OF NEW HAMPSHIRE

___________________________

Board of Tax and Land Appeals
No. 2019-0061

APPEAL OF KEITH R. MADER 2000 REVOCABLE TRUST & a.
(New Hampshire Board of Tax and Land Appeals)

Argued: November 19, 2019
Opinion Issued: June 5, 2020

Cooper Cargill Chant, P.A., of North Conway (Randall F. Cooper on the
brief and orally), for the petitioners.

Donahue, Tucker & Ciandella, PLLC, of Exeter (Christopher T. Hilson
and Brendan A. O’Donnell on the brief, and Mr. Hilson orally), for the
respondent.

HANTZ MARCONI, J. The petitioners1 appeal a decision of the New
Hampshire Board of Tax and Land Appeals (BTLA) dismissing their appeals of
the denials of applications for abatements of real estate taxes issued by the
respondent, Town of Bartlett (Town). The BTLA dismissed the appeals because
the petitioners’ abatement applications failed to comply with the signature and
certification requirement of New Hampshire Administrative Rules, Tax 203.02

1There are eighteen petitioners in this matter: Keith R. Mader 2000 Revocable Trust; Bearfoot
Creek, LLC; Robert McInnis; Marie McInnis; Slalom Realty Trust; JR Realty Trust; Carol
McPhearson; Bryce Blair; Kathi Blair; Eileen A. Figueroa Revocable Trust; Joseph A. Carlucci
Living Trust; Mary F. Carlucci Living Trust; Mark J. Gallagher; Paula J. Gallagher; TJF Trust;
Christopher Redondi; Amy Redondi; and Engeocom Bartlett, LLC.
(Tax 203.02), and because the BTLA found that the petitioners did not
demonstrate that these failures were “due to reasonable cause and not willful
neglect.” See N.H. Admin. R., Tax 203.02(d). We vacate and remand.

The following facts were found by the BTLA or are otherwise undisputed
for the purposes of this appeal. The petitioners own property at a
condominium development in Bartlett, and, with one exception, they are
located out of state. On February 7, 2018, Attorney Randall F. Cooper received
a message left by James Rader, the principal of the condominium developer,
requesting legal representation due to a substantial increase in real estate
taxes facing property owners. Cooper responded by e-mail that same day,
communicating that he was willing to represent the property owners, but that
he was leaving in two days for a vacation out of the country and would not
return until February 26. Cooper assured Rader that, even though abatement
applications were due to the Town by March 1, he would be able to timely
submit them.

Before leaving for vacation, Cooper contacted an appraisal firm to
confirm the firm’s availability to perform an appraisal and sent Rader a
representation agreement. According to the petitioners, they did not agree to
the terms of the representation agreement until February 20, while Cooper was
away on vacation.

Cooper returned from vacation on February 26 and prepared the
abatement applications, which were submitted to the Town on or about
February 27. The petitioners did not personally sign or certify their respective
applications. Rather, Cooper, as their attorney, signed on their behalf. As to
each application, Cooper certified that there was a good faith basis for the
application and that the facts as stated in the application were true to the best
of his knowledge.

The Town denied the abatement applications,2 and the petitioners
appealed to the BTLA on August 27. By letter dated October 10, the BTLA
requested “written proof” that the petitioners “signed the abatement
applications filed with the Town in compliance with [Tax 203.02].” On October
24, the petitioners filed a motion seeking an exception from Tax 203.02’s
signature and certification requirement. The petitioners acknowledged that
they had not personally signed or certified their respective abatement
applications, but contended that the omissions were “due to reasonable cause
and not willful neglect.” See N.H. Admin. R., Tax 203.02(d). In addition to
their motion, the petitioners submitted personally signed affidavits in which

2Although the Town denied the abatement applications, the lack of the petitioners’ signatures and
certifications was not the reason for the denials. See RSA 76:16, III(g) (Supp. 2019); Henderson
Holdings at Sugar Hill v. Town of Sugar Hill, 164 N.H. 36, 40 (2012).

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they certified that they had good faith bases to seek abatements at the time
their respective applications were filed.

The BTLA denied the motion and dismissed the appeals. It found that
the petitioners failed to comply with Tax 203.02’s signature and certification
requirement, and further found that the petitioners had failed to demonstrate
that these failures were “due to reasonable cause and not willful neglect.” As
to the latter finding, the BTLA stated that “[t]he record presented indicates
[that Cooper] made a conscious decision not to obtain the Taxpayers’
signatures and certifications prior to filing,” and that his “anticipated vacation
plans do not constitute reasonable cause.” The petitioners filed a motion for
rehearing, which the BTLA denied. This appeal followed.

Our standard for reviewing BTLA decisions is set forth by statute.
Appeal of N.H. Elec. Coop., 170 N.H. 66, 72 (2017); see RSA 71-B:12 (2012);
RSA 541:13 (2007). We will not set aside or vacate a BTLA decision except for
errors of law, unless we are satisfied, by a clear preponderance of the evidence,
that such order is unjust or unreasonable. Appeal of Town of Charlestown,
166 N.H. 498, 499-500 (2014); see RSA 541:13. The appealing party has the
burden of demonstrating that the BTLA’s decision was clearly unreasonable or
unlawful. See Town of Charlestown, 166 N.H. at 499; RSA 541:13. The BTLA’s
findings of fact are deemed prima facie lawful and reasonable. Town of
Charlestown, 166 N.H. at 499; see RSA 541:13. However, the interpretation of
a statute or a regulation is to be decided ultimately by this court. See Appeal
of Cole, 171 N.H. 403, 412 (2018); Appeal of Wilson, 161 N.H. 659, 661 (2011).
If we find that the BTLA misapprehended or misapplied the law, its order will
be set aside. See Wilson, 161 N.H. at 661.

Resolution of this case requires us to interpret administrative rules. The
interpretation of a rule, like the interpretation of a statute, presents a question
of law subject to de novo review. See Appeal of Cook, 170 N.H. 746, 749
(2018). We use the same principles of construction when interpreting both
statutes and administrative rules. Id. Where possible, we ascribe the plain
and ordinary meaning to the words used in administrative rules. See Appeal of
Silva, 172 N.H 183, 186-87 (2019). We construe all parts of an administrative
rule together to effectuate its overall purpose and to avoid an absurd or unjust
result. See id. at 187. Moreover, in construing the BTLA’s rules we are
mindful that the statutory tax abatement scheme “is written to make the
proceedings free from technical and formal obstructions.” GGP Steeplegate v.
City of Concord, 150 N.H. 683, 686 (2004); see also Arlington Mills v. Salem, 83
N.H. 148, 154 (1927). Like the statutory scheme they are designed to
implement, administrative rules governing tax abatement appeals “should be
construed liberally, in advancement of the rule of remedial justice which” they
implement. GGP Steeplegate, 150 N.H. at 686 (quotation omitted).

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 The submission of an abatement application to a municipality is a
prerequisite to the BTLA’s review of an abatement request. See N.H. Admin. R.,
Tax 203.02(a). Tax 203.02 imposes several requirements on municipal
abatement applications. As is relevant to this case, the application must
include “[t]he taxpayer’s signature . . . certifying that the application has a good
faith basis and the facts stated are true.” N.H. Admin. R., Tax 203.02(b)(4).
The rule further provides:

The taxpayer shall sign the abatement application. An attorney or
agent shall not sign the abatement application for the taxpayer.
An attorney or agent may, however, sign the abatement application
along with the taxpayer to indicate the attorney’s or agent’s
representation. The lack of the taxpayer’s signature and
certification shall preclude an RSA 76:16-a appeal to the board
unless it was due to reasonable cause and not willful neglect.

N.H. Admin. R., Tax 203.02(d) (emphasis added). Thus, although the rule
plainly states that an attorney may not substitute his or her signature for the
taxpayer’s, the lack of a taxpayer’s personal signature and certification on a
municipal abatement application does not preclude an appeal of the denial of
that application to the BTLA if the omission is “due to reasonable cause and
not willful neglect.” Id.; see also Henderson Holdings at Sugar Hill v. Town of
Sugar Hill, 164 N.H. 36, 40 (2012).

There is no dispute in this case that the petitioners did not personally
sign or certify their abatement applications. Instead, the petitioners contest
the BTLA’s ruling that they did not demonstrate that the lack of signatures and
certifications was due to reasonable cause and not willful neglect.

We have not previously had occasion to construe the reasonable cause
and not willful neglect exception in Tax 203.02. But cf. Appeal of Steele Hill
Development, Inc., 121 N.H. 881, 884-85 (1981) (construing agency order
imposing additional taxes as an implicit finding that plaintiff had not
demonstrated that his failure to timely file tax return was due to reasonable
cause rather than willful neglect under a since-repealed taxation statute, see
RSA ch. 71-A (repealed 1985)). Although the question of whether reasonable
cause or willful neglect exists in a particular case is one of fact for the BTLA,
the questions of what elements constitute reasonable cause or willful neglect
under Tax 203.02 are ones of law. See United States v. Boyle, 469 U.S. 241,
249 n.8 (1985); Cook, 170 N.H. at 749. Thus, we analyze the reasonable cause
and not willful neglect exception in Tax 203.02(d) de novo. See Cook, 170 N.H.
at 749.

Neither “reasonable cause” nor “willful neglect” is defined in the BTLA’s
regulations. See N.H. Admin. R., Tax 102.01-.40 (defining certain terms used
in BTLA regulations). But cf. N.H. Admin. R., Tax 102.02 (“‘Accident, mistake,

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or misfortune’ means something outside the party’s own control and not due to
neglect, or something that a reasonably prudent person would not be expected
to guard against or provide for.” (emphasis added)). We have noted, however,
that “[w]illful is a word of many meanings depending upon the context in which
it is used.” Appeal of Morgan, 144 N.H. 44, 52 (1999) (quotation omitted);
accord Rood v. Moore, 148 N.H. 378, 379 (2002). Furthermore, although we
have often stated that actions are not willful when taken accidentally or on the
basis of a mistake of fact, see, e.g., Miller v. Slania Enters., 150 N.H. 655, 662
(2004), our case law does not “indicate an intent to define ‘willful’ the same in
every context,” Morgan, 144 N.H. at 52. Nor does this oft-repeated
construction mean that, in order for a given action to be nonwillful, it must
have been taken accidentally or on the basis of a mistake of fact. In certain
contexts, for example, we have analyzed whether noncompliance with a statute
or regulation was willful based upon whether compliance was reasonably
possible under the circumstances. See id. at 52-53; Ives v. Manchester
Subaru, Inc., 126 N.H. 796, 801-02 (1985).

In Morgan, we upheld a finding of the New Hampshire Board of
Pharmacy that the petitioner willfully violated specific recordkeeping and data
entry statutes because he was not prevented from complying with those
statutes by “circumstances beyond his reasonable control.” Morgan, 144 N.H.
at 45, 53. Morgan is consistent with the construction we gave RSA 275:44
(2010) in Ives. See Ives, 126 N.H. at 801-02. RSA 275:44, IV, which was at
issue in Ives, provides that “[i]f an employer willfully and without good cause
fails to pay an employee wages as required under” other paragraphs of the
statute, the employer is liable for liquidated damages. RSA 275:44, IV; see
Ives, 126 N.H. at 801. In Ives, we stated that an employer willfully and without
good cause fails to pay an employee wages under RSA 275:44, IV when the
employer withholds wages “voluntarily, with knowledge that the wages are
owed and despite financial ability to pay them.” Ives, 126 N.H. at 802
(emphasis added); see also Richmond v. Hutchinson, 149 N.H. 749, 751-52
(2003) (applying construction of RSA 275:44, IV from Ives; rejecting argument
that employer did not willfully withhold wages because the record showed the
employer did not have a bona fide belief it was unable to pay said wages).
Thus, Ives gave meaning to the “willfully and without good cause” standard in
RSA 275:44, IV by focusing on whether the employer withheld wages even
though the employer had the funds available to pay them. See Ives, 126 N.H.
at 801-02.

The construction we gave to RSA 275:44, IV in Ives, which uses language
similar to Tax 203.02(d)’s “reasonable cause and not willful neglect” standard,
tracks with federal laws that can excuse the failure to meet certain tax return
filing requirements. See Steele Hill Development, 121 N.H. at 885 (relying
upon “[f]ederal courts that have dealt with . . . language similar to that before
us” to conclude that the taxpayer had the burden of proving that his failure to
file a tax return was due to reasonable cause and not willful neglect under a

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since-repealed statute). The Internal Revenue Code “imposes mandatory
penalties for the failure to file returns . . . unless the taxpayer can show that
such failure was due to ‘reasonable cause’ and not due to ‘willful neglect.’”
East Wind Industries, Inc. v. United States, 196 F.3d 499, 504 (3d Cir. 1999);
see 26 U.S.C. § 6651(a) (2018). See generally Ann K. Wooster, Annotation,
What, Other Than Reliance on Attorney, Accountant, or Other Expert,
Constitutes “Reasonable Cause” Excusing Failure to File Tax Return or to Pay
Tax, Under § 6651(a) of Internal Revenue Code of 1986 (26 U.S.C.A. § 6651(a)),
168 A.L.R. Fed. 461 (2001). Furthermore, taxpayers who fail to comply with
certain information reporting requirements are not subject to penalties “if it is
shown that such failure is due to reasonable cause and not to willful neglect.”
26 U.S.C. § 6724(a) (2018); see In re Refco Public Commodity Pool, L.P., 554
B.R. 736, 742 (Bankr. D. Del. 2016).

Although neither “reasonable cause” nor “willful neglect” is defined in the
Internal Revenue Code, see East Wind Industries, 196 F.3d at 504, the former
is defined by Treasury Regulations, see 26 C.F.R. §§ 301.6651-1(c)(1) (2019),
301.6724-1(a)(2) (2019). The Treasury Regulation applicable to the failure to
timely file a tax return states that a delay in filing is due to reasonable cause
“[i]f the taxpayer exercised ordinary business care and prudence and was
nevertheless unable to file the return within the prescribed time.” 26 C.F.R.
§ 301.6651-1(c)(1). Similarly, the regulation applicable to the failure to comply
with certain statutorily mandated information reporting requirements states
that reasonable cause will exist if “[t]he failure arose from events beyond the
filer’s control,” 26 C.F.R. § 301.6724-1(a)(2)(ii), and the filer establishes that he
or she “acted in a responsible manner . . . both before and after the failure
occurred,” 26 C.F.R. § 301.6724-1(a). See In re Refco, 554 B.R. at 742. “[T]he
threshold inquiry” under the federal reasonable cause standard “is whether,
based on all the facts and circumstances, the taxpayer exercised ordinary
business care and prudence.” Id.

As for “willful neglect,” the United States Supreme Court construed that
phrase in Boyle. See Boyle, 469 U.S. at 245. The Court stated that the
meaning of “willful neglect” had “become clear over the near-70 years of [the
phrase’s] presence in the” Internal Revenue Code. Id. As used in the Code,
“the term ‘willful neglect’ may be read as meaning a conscious, intentional
failure or reckless indifference.” Id. “Stated another way,” to show that a
failure was not due to willful neglect, “the taxpayer must show that the failure
. . . was the result ‘neither of carelessness, reckless indifference, nor
intentional failure.’” East Wind Industries, 196 F.3d at 504 (quoting Boyle, 469
U.S. at 246 n.4).

We find these federal authorities involving materially identical language
to Tax 203.02(d)’s “reasonable cause and not willful neglect” standard highly
persuasive. See Steele Hill Development, 121 N.H. at 885. Like the Second
Circuit Court of Appeals, “we believe that ‘reasonable cause and not willful

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neglect’ must refer not simply to whether the taxpayer acted voluntarily in the
sense of acting consciously, but also to whether the filer’s reason for so acting
was objectively reasonable under the circumstances.” Gerald B. Lefcourt, P.C.
v. United States, 125 F.3d 79, 84 (2d Cir. 1997). In addition to the federal
authorities discussed above, we draw support from our own case law
construing similar standards, see Ives, 121 N.H. at 801-02, our longstanding
interpretive rule that the tax abatement scheme “should be construed
liberally,” with the goal of making abatement proceedings “free from technical
and formal obstructions,” GGP Steeplegate, 150 N.H. at 686 (quotation
omitted); accord Arlington Mills, 83 N.H. at 154, as well as the BTLA’s own
regulations, which appear to contemplate that a party’s action is “not due to
neglect” when it is attributable to “something outside the party’s own control”
or to “something that a reasonably prudent person would not be expected to
guard against or provide for,” N.H. Admin. R., Tax 102.02.

For all of these reasons, we construe Tax 203.02(d)’s reasonable cause
and not willful neglect exception as permitting abatement appeals to the BTLA
despite the lack of a taxpayer’s signature and certification on the application at
issue if the taxpayer can show that, despite exercising ordinary business care
and prudence, it was not reasonably possible to submit the application with
the taxpayer’s signature and certification, and can further show that he or she
was not recklessly indifferent to the signature and certification requirement in
preparing the application.

In this case, the BTLA concluded that the administrative record was
“bereft of supporting facts” that would warrant a finding that the lack of the
taxpayers’ signatures was due to reasonable cause and not willful neglect
because, in part, “[t]he record presented indicate[d] [that Cooper] made a
conscious decision not to obtain the Taxpayers’ signatures and certifications”
in preparing the abatement applications after returning from vacation.
Although the BTLA did not explain how it construed Tax 203.02(d)’s reasonable
cause and not willful neglect standard, that the BTLA offered Cooper’s
“conscious decision” to omit the petitioners’ signatures as a justification for
dismissing their appeals suggests that the BTLA construed the standard to
focus, at least in part, on whether the omissions were intentional. Such a
focus is perhaps understandable in light of Tax 203.02(d)’s use of the word
“willful,” but the proper interpretation of “willful” in a given statute or
regulation depends upon the context in which it appears. Morgan, 144 N.H. at
52. In light of Tax 203.02’s context, as discussed above, we do not construe
the rule’s reasonable cause and not willful neglect standard to focus on
whether the taxpayers intended to submit applications without their signatures
and certifications; rather, we construe the standard to permit abatement
appeals to the BTLA despite noncompliance with the signature and certification
requirement when the taxpayer can show that it was not reasonably possible to
comply with that requirement despite exercising ordinary business care and
prudence, and that the taxpayer was not recklessly indifferent to the signature

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and certification requirement. See, e.g., Gerald B. Lefcourt, P.C., 125 F.3d at
84; see also Ives, 121 N.H. at 801-02; GGP Steeplegate, 150 N.H. at 686; cf.
N.H. Admin. R., Tax 102.02.

Because the BTLA did not have the benefit of the construction of Tax
203.02(d) that we announce today, however, and because the primary issue
presented by the petitioners’ motion was whether the lack of their signatures
and certifications “was due to reasonable cause and not willful neglect” under
Tax 203.02(d), we vacate the BTLA’s decision and remand for further
consideration in light of our construction. See Cook, 170 N.H. at 753. We
trust that the BTLA will give appropriate weight to the circumstances in this
case that bear on the objective reasonableness for the omitted signatures and
certifications. Those circumstances include, but are not necessarily limited to,
the following: the petitioners sought representation; the representation
agreement was not signed until Cooper was away on vacation; Cooper had
approximately three days to complete and file the abatement applications after
returning from vacation; all but one of the petitioners were located out of state;
and the Town did not reject the applications for the lack of signatures. See In
re Hudson Oil Co., Inc., 91 B.R. 932, 950-51 (Bankr. D. Kan. 1988) (finding
reasonable cause where time constraints made timely filing impossible).

In addition to arguing that the omissions of their signatures and
certifications were due to reasonable cause and not willful neglect, the
petitioners appear to suggest that Tax 203.02(d) may be ultra vires insofar as it
prohibits attorneys from signing abatement applications for their clients. See
Bach v. N.H. Dep’t of Safety, 169 N.H. 87, 94 (2016) (concluding that
administrative rules were ultra vires and thus unlawful because they changed
the requirements of the statute they were intended to implement). In light of
our decision reinstituting the petitioners’ abatement appeals, we need not
address, at this time, whether the BTLA may lawfully promulgate a rule
permitting the dismissals of property tax abatement appeals on the sole basis
that the taxpayer’s attorney signed and certified the abatement application at
issue. See Antosz v. Allain, 163 N.H. 298, 302 (2012). However, we take this
opportunity to note that we do not view Wilson as necessarily determinative of
that question. Wilson did not involve an attorney — with a special obligation of
candor toward the tribunal, see N.H. R. Prof. Conduct 3.3 — who signed the
necessary section of the abatement application certifying that the application
has a good faith basis and that the facts stated in it are true. See Wilson, 161
N.H. at 660 (the nonattorney representative merely wrote on the signature line
for the abatement applicants “See agent form,” but the accompanying agent
authorization form signed by the applicants did not contain a certification that
the facts stated in the abatement application were true). Nor do we view
Henderson Holdings, the facts of which did not implicate Tax 203.02(d)
because the petitioner appealed the denial of its abatement application to the
superior court, not the BTLA, as controlling on that issue. See Henderson
Holdings, 164 N.H. at 37-38, 40.

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 We have reviewed the remaining appellate arguments and conclude that
under the circumstances of this case, they do not warrant further discussion.
See Vogel v. Vogel, 137 N.H. 321, 322 (1993).

In summation, we vacate the BTLA’s decision dismissing the petitioners’
abatement appeals and remand for further consideration as to whether the
omissions of the petitioners’ personal signatures and certifications on their
applications were “due to reasonable cause and not willful neglect” as we have
construed that phrase.

Vacated and remanded.

HICKS, BASSETT, and DONOVAN, JJ., concurred.

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