Daily Gazette Co., Inc. v. Caryl

McHUGH, Justice,

dissenting:

I respectfully dissent. Although the majority’s approach is well intentioned, it is ill conceived. The primary springboard must be the State Freedom of Information Act, W.Va.Code, 29B-1-1 to -6, as amended, and not the tax statutes of the state. The majority opinion conflicts with the public policy forcefully declared in W.Va.Code, 29B-1-1 [1977]: “[A]ll persons are, unless otherwise expressly provided by law, entitled to full and complete information regarding the affairs of government and the official acts of those who represent them as public officials and employees.” (emphasis added) Consistent with this declaration of policy, W. Va. Code, 29B-1-4(5) [1977] provides that “[information specifically exempted from disclosure by statute” is specifically exempt from disclosure under the State Freedom of Information Act.

The question presented by this case is whether state tax compromise documents and related state tax returns are “specifically exempted from disclosure” to the public by any of the state statutes. Applying the principle, recognized by the majority in syllabus point 1, that the exemptions to the Freedom of Information Act are to be strictly construed, one searches in vain for such a specific exemption, except as to information in reports to the legislature on state tax compromises.

Neither of the tax statutes mentioned by the majority constitutes such a specific exemption as to all state tax compromise documents and related returns. W.Va. Code, 11-10-5d(a) [1986, 1988], providing for the confidentiality of tax returns and return information, contains an exception which is applicable here. Tax returns and return information are subject to disclosure “in any proceeding in which the tax commissioner is a party before a court of competent jurisdiction to collect or ascertain the amount of ... tax[.]” While the action brought by CSX in the federal district court was brought to determine the constitutionality of the West Virginia carrier income tax statute, as opposed to determining the particular amount of tax liability, it results in a broad construction in favor of exemption from disclosure to conclude that the amount of tax is not involved in the action to determine constitutionality. The majority concedes as much in footnote 10 of its opinion: “[T]he amount of tax owed is ultimately the bottom line even when the primary question is the constitutionality of the tax.” This exception to the confidentiality of tax returns and return information is a legislative recognition that a taxpayer does not reasonably expect privacy with respect to the taxpayer’s tax returns and return information when the taxpayer is involved in tax litigation in court. See W.Va.Code, 11-10-5d(k) [1986, 1988], The question of the confidentiality of “closing agreements” without litigation in court, see W.Va.Code, 11-10-5q(a)-(b) [1986], is not before this Court in this case.

W.Va.Code, 11-10-5q [1986], involving state tax compromises, provides, in subsection (e), for confidentiality of the taxpayers’ identity in the tax commissioner’s quarterly reports to the legislature, but does not, in subsection (d), provide for such confidentiality in the compromise record documents required to be maintained by the tax commissioner, specifically, the opinion of the tax commissioner’s legal counsel and any written recommendation of the attorney general. The majority, unlike the legislature, inserts the confidentiality provision of subsection (e) into subsection (d) also. The rule of strictly construing exemptions from disclosure under the Freedom of Information Act would result in the conclusion that the documents in subsection (d) of W. Va. Code, 11-10-5q [1986] are subject to disclosure, for they are not specifically exempted.

In short, as stated by the majority in footnote 11 of its opinion, “we cannot state in all honesty that the [tax] statute is per*49fectly clear on the issue of confidentiality[.]” That being the case, the Freedom of Information Act requires disclosure of the state tax compromise documents and related state tax returns and return information, except the reports to the legislature. “The people, in delegating authority, do not [implicitly] give their public servants the right to decide what is good for the people to know and what is not good for them to know. The people insist on remaining informed[.]” W.Va.Code, 29B-1-1 [1977].

Significantly, federal tax law provides for disclosure of accepted offers-in-compromise: “Return information shall be disclosed to members of the general public to the extent necessary to permit inspection of any accepted offer-in-compromise under section 7122” of the Internal Revenue Code. I.R.C. § 6103(k)(1) (1982). This rule of disclosure should be of highly persuasive value, particularly because W.Va. Code, 11-10-5q [1986] is modeled, in part, upon I.R.C. §§ 7121 and 7122 (1982). That W. Va.Code, 11-10-5q(d) [1986] does not expressly authorize disclosure is immaterial because disclosure is authorized under the State Freedom of Information Act, unless there is a specific exemption. The question is whether there is a specific exemption from disclosure, not whether disclosure is specifically authorized by the tax statutes.

As to the provisions of W.Va.Code, 11-10-5d(c) [1986, 1988] imposing a misdemeanor penalty upon a state officer or employee (or former state officer or employee) for violation of the confidentiality requirements for tax returns and return information, such a penalty would not be valid when the information was disclosed under the Freedom of Information Act. It should be noted that a custodian of public records who willfully violates the provisions of the Freedom of Information Act is likewise guilty of a misdemeanor. W.Va. Code, 29B-1-6 [1977].

For the foregoing reasons, I dissent. I am authorized to state that Justice MILLER joins in this dissenting opinion.