dissenting.
There is no suggestion in this case that Boulder County did anything wrong in collecting personal property taxes from Health-South. Rather, the payment of personal property taxes at issue here was based on HealthSouth's intentional misrepresentations in documents that it submitted to the County. The County did not invent fictitious personal property; HealthSouth did. The County did not give this fictitious personal property a value; HealthSouth did. As a result, I would conclude that HealthSouth is not entitled to pursue the administrative remedy of abatement and refund of its taxes because it bases its claim for relief on its own misconduct. Therefore, because I would affirm the Board of Assessment Appeals order, I respectfully dissent.
I. Background
The record in this case contains a letter written to the Boulder County Treasurer by an accountant seeking the tax abatement and refund for HealthSouth. The letter asked the Treasurer to note that
as part of a fraudulent scheme [Health-South] inflated income with matching entries to property, plant, and equipment accounts.... [Bleginning with the 1999 tax year, business personal property tax renditions began to include fictitious assets.
To explain the nature of the fraud, the letter referred to the copy of an attached civil complaint that had been filed against HealthSouth by the Securities and Exchange Commission in Alabama. The complaint stated:
Since 1999, HealthSouth, one of the nation's largest healthcare providers, has overstated its earnings by at least $1.4 billion. This massive overstatement occurred because [HealthSouth's founder] insisted that [HealthSouth] meet or exceed earnings expectations established by Wall Street analysts. When [HealthSouth's] earnings fell short of such estimates, [the founder] directed [HealthSouth's] accounting personnel to "fix it" by artificially inflating the company's earnings to match Wall Street expectations. To balance [HealthSouth's] books, the false increases in earnings were matched by false increases in [HealthSouth's] assets. By the third quarter of 2002, [HealthSouth's] assets were overstated by at least $800 million, or approximately 10 percent of total assets.
The complaint later indicated that the purpose of matching the expectations of Wall Street's analysts was to "maintain the market price for [HealthSouth's] stock." One of the means of inflating asset value was to "record[ ] false entries to the fixed asset books of [HealthSouth's] numerous facilities. The combined amount of the false entries equaled the total amount of fictitious increases to the income statement for that quarter."
This cynical, fraudulent scheme is apparently not unique.
Since the implosion of Enron in November of 2001, Wall Street has been severely shaken by an unprecedented string of accounting fraud seandals involving publicly traded corporations. Most of the corporations involved have been guilty of earnings inflation-adding fictitious income to their financial statements. The appeal of earnings inflation is obvious. By means of various accounting gimmicks, or by simply manufacturing transactions that never took place, a company can create a steadily *973rising earnings curve that will boost its share price. Not surprisingly, this produces lucrative rewards for management. Stock option grants to management frequently are tied to specified earnings targets that may be achieved more quickly by manipulating the company's books. Moreover, as share prices rise based on increases in revenue and profit, management may realize ever-greater gains from sales of previously acquired shares of the company
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Although they are not compelled to do so, corporations that inflate their earnings often pay tax on the fictitious income they create because doing so helps to hide the accounting fraud from investors, analysts and the SEC. If the fraud goes undetected, an offending corporation almost certainly will be content to allow the government to keep the tax overpayments. When the fraud is exposed, however, the corporation is likely to respond by seeking a refund of the overpaid taxes, which may amount to tens or even hundreds of millions of dollars
Craig M. Boise, Playing with "Monopoly Money": Phony Profits, Fraud Penalties and Equity, 90 Minn. L.Rev. 144, 146-47 (Nov.2005) (footnotes omitted).
IIL. Analysis
A. Introduction
In my view, (1) HealthSouth's claim is barred by its own misconduct; and (2) seetion 39-5-116(2)(c), C.R.8.2008, allows such misconduct to be taken into consideration when determining whether a taxpayer is entitled to pursue the statutory right to tax abatement and refund. Section 89-5-116(2)(a), C.R.$.2008, sets out a general rule:
A person fails to make a full and complete disclosure of his personal property pursuant to this paragraph (a) if he includes in a filed schedule any information concerning his property which is false, erroneous, or misleading or fails to include in a schedule any taxable property owned by him.
The legislature further indicates what the effect of violating the general rule is:
Any person subject to paragraph (a) of this subsection (2) shall have the right to pursue the administrative remedies available to taxpayers under this title, dependent wpon the basis of his claim.
§ 39-5-116(2)(c) (emphasis supplied).
In my view, the language of section 39-5-116(2)(c) clearly states that making false, erroneous, or misleading statements does not necessarily bar the pursuit of administrative remedies, such as tax abatement and refund. However, the statute also makes clear that making such statements may prevent a taxpayer from pursuing such administrative remedies based upon the nature of the claim.
B. History
1. Statutory History
In the absence of a statute, voluntarily paid taxes are normally not recoverable by the taxpayer, even if those taxes were collected illegally. See generally, David J. Mar-chitelli, Annotation, Voluntary Payment Doctrine as Bar to Recovery of Payment of Generally Unlawful Tax, 1 ALR. 6th 229 (2005); 16 Eugene MceQuillin, The Law of Municipal Corporations § 44.180 (8d ed.2003). The rationale for this concept, called the voluntary payment doctrine or the voluntary payment rule, was explained by the Texas Supreme Court:
This voluntary payment rule may seem counterintuitive, but there are important reasons supporting it. In the taxation context, the rule secures taxing authorities in the orderly conduct of their financial affairs. The [United States] Supreme Court has also recognized the "government's exceedingly strong interest in financial stability in this context" and threats to a state's financial security that can arise from unpredictable revenue shortfalls The rule also supports the age-old policies of discouraging litigation with the government.
Dallas County Community College Dist. v. Bolton, 185 S.W.3d 868, 876-77 (Tex.2005) (quoting McKesson Corp. v. Div. of Alcoholic Beverages & Tobacco, 496 U.S. 18, 37, 110 S.Ct. 2238, 110 L.Ed.2d 17 (1990)) (citations omitted).
In Colorado, a taxpayer's statutory ability to seek an abatement and refund of taxes has been in effect since 1902. Board of Assessment Appeals v. Benbrook, 735 P.2d 860, 863 *974(Colo.1987). Therefore, because Colorado has a statutory structure that allows for abatement and refund of taxes, the voluntary payment doctrine does not apply to this case.
However, the rationale for the voluntary payment doctrine still plays a role in the functioning of our tax abatement and refund statutes.
To accommodate the dual needs in Colorado for a reliable constant source of revenue for the government and a remedy for taxpayers who sought to enjoin tax collections in the courts because they believed they were carrying a disproportionate share of the tax burden, Colorado established a statutory remedy that recognized some in-junetive actions in equity under the "traditional equity head of fraud" but required a taxpayer to exhaust administrative remedies before going to court if an assessment is deemed excessive.
Id. (quoting Ela, Some Aspects of Colorado Taxpayers' Remedies, 28 Rocky Mtn. L.Rev. 145, 160 (1950)).
The legislature has, over time, granted taxpayers more leeway when seeking an abatement and refund for taxes they paid because of their mistakes. See Portofino Corp. v. Board of Assessment Appeals, 820 P.2d 1157, 1160 (Colo.App.1991)("[Wle conclude that, in amending [section 39-10-114, C.R.S 2008] in 1988, the General Assembly intended to provide taxpayers the opportunity to utilize the abatement and refund provisions for the purpose of challenging an overvaluation.").
Evidence of this legislative trend is found in the evolution of section 89-5-116(2). As pertinent here, the General Assembly first adopted the language referring to "false, erroneous, or misleading" information that now appears in section 39-5-116(2)(a) in 1964. Ch. 94, § 187-5-16, 1964 Colo. Sess. Laws 702. Subsection (2)(c) was added in 1987. Ch. 296, see. 1, § 89-5-116(2)(c), 1987 Colo. Sess. Laws 1415.
However, at present, this legislative trend culminates with the version of section 39-5-116(2)(c) that has been in effect since 1987. Because the statutory right to an administrative remedy is qualified by the phrase "dependent upon the basis of [the] claim," the legislature has not reached the point of stating that a taxpayer is entitled to pursue administrative remedies seeking a tax abatement and refund in all cireumstances in which the taxpayer has provided false, erroneous, or misleading information.
2. Colorado Case Law History
The supreme court has looked at the abatement and refund statutory structure several times when considering the effect of mistakes by taxpayers in valuing personal property. In Boyer Bros. v. Board of Commissioners, 87 Colo. 275, 288 P. 408 (1980), Wyoming sheepherders had entered into an agreement with a Colorado assessor to pay taxes on sheep grazing in Colorado. The assessment rate was higher than that provided by statute, and the sheepherders sought to recover the difference between the agreed-upon rate and the statutory rate. The supreme court rejected their argument, observing that
[hlaving been, in part at least, responsible for the assessment in the manner de-seribed, and having failed to file a schedule required by law, [the sheepherders are] in no position to urge, as a ground for recovering the taxes paid by [them], the method of assessment followed in this case.
Id. at 285, 288 P. at 413.
In E.A. Stephens & Co. v. Board of Equalization, 104 Colo. 556, 92 P.2d 732 (1939), a company sought an abatement and refund of overpaid personal property taxes, arguing that, because of a bookkeeper's mistake, it had given the taxing authority erroneous values of the property. Our supreme court concluded that the company was not entitled to the relief it requested because
it appears that [the company] voluntarily paid the taxes in question; that the error involved was due solely to calculations contained in [the company's] own tax schedule; that the schedule was voluntarily made by it; that the error was due solely to [the company's] own negligence and not to any action of the taxing agencies; that the facts which show the mistake were in the sole possession of [the company].
Id. at 559, 92 P.2d at 733.
The supreme court then pointed out that there was a public policy reason for denying *975an abatement and refund that echoes the rationale for the voluntary payment doctrine:
To permit recovery under the facts and cireumstances in the instant case would endanger the entire tax structure of the state and lead to a multiplicity of suits for refund of taxes.
Id. at 561, 92 P.2d at 734; see also Coquina Oil Corp. v. Larimer County Bd. of Equalization, 770 P.2d 1196, 1201 (Colo.1989) ("Taxpayers who create the overvaluation by supplying erroneous information to the taxing authority must discover the mistake and protest within the time prescribed in section 39-5-122 [C.R.S.2008]."), superseded by statute, § 39-10-114(1)(a)(D(A), C.R.S.2008, as stated in Portofino Corp., 820 P.2d at 1159-60.
As recently as 1998, the supreme court recognized the importance of "strict enforcement of statutory duties imposed on taxpayers." Property Tax Administrator v. Production Geophysical Services, Inc., 860 P.2d 514, 519 (Colo.1993).
C. Harm
I do not cite these Colorado cases because they represent the present status of section 39-5-116(2)(c). Clearly, the legislature has modified the terrain, most recently in 1987, to allow taxpayers to pursue administrative remedies even in some cases when an overpayment may be due entirely to their own conduct.
Rather, I cite these cases because they demonstrate that our supreme court has observed that, absent an express statutory statement to the contrary, taxpayer conduct can bar a tax abatement and refund, and that providing an abatement and refund of overpaid taxes in certain cireumstances can harm the "entire tax structure of the state." This leads me to conclude that such harm is an appropriate factor to consider when determining whether a taxpayer's intentional misrepresentation in valuing personal property can be the basis for an administrative remedy.
HealthSouth contends that the County did not suffer any injury because of its misrepresentations. Rather, this argument goes, the County received tax revenue that it would not have obtained had HealthSouth truthfully reported the value of its personal property. Thus, the County received a windfall, and was not a victim of HealthSouth's scheme.
I disagree with this line of reasoning under the cireumstances of this case for three reasons. First, there is the harm done by removing money from the public treasury. As a justice of the Ohio Supreme Court commented in a recent case involving Health-South's similar request for an abatement and refund of personal property tax in that state:
While the majority laments the loss to the "innocent investor" caused by the corporate fraud, I believe that the government and taxing districts are also primary vie-tims of the fraud. While the taxing districts may have temporarily benefited from the overpayment of taxes by HealthSouth (and therefore presumably adjusted their budgets to reflect such income), those same taxing districts, if a refund is upheld on remand, will now be forced, in these very difficult economic times, to come up with funds to repay those tax benefits received. And what is worse, those funds will go back to a corporation that has admitted to massive fraud.
HealthSouth Corp. v. Levin, 121 Ohio St.3d 282, 2009-Ohio-584, 903 N.E.2d 1179, 1188 (2009)(Lundberg Stratton, J., concurring).
Second, because the property tax valuation system relies on truthful self-reporting, filing intentionally false disclosures reduces confidence in the system. If the public perceives that misrepresentations designed to secure personal advantage are common, voluntary compliance may dwindle. See United States v. Bove, 155 F.3d 44, 49 (2d Cir.1998)(filing a false income tax return implicates the integrity of the national tax system); Boise, Playing with "Monopoly Money", 90 Minn. L.Rev. at 172 n. 120 ("'There is substantial economic literature on the effect of taxpayer attitudes on tax compliance, with most researchers concluding that taxpayer perceptions of fairness in the tax system and perceptions of compliance by other taxpayers significantly affect the overall rate of tax compliance.").
Third, misrepresentations like these can adversely affect the County's capacity to do its duty. The ability to determine a taxpayer's true tax liability may be compromised *976because, during the period the County relies on the false report, records may be destroyed or falsified. See Badaracco v. Commissioner, 464 U.S. 386, 398, 104 S.Ct. 756, 78 L.Ed.2d 549 (1984) (federal criminal income tax case). Subsequent voluntary disclosures may not be trusted, for obvious reasons, thus requiring the County to focus more resources on verification of that taxpayer's submissions. Id. at 399, 104 S.Ct. 756.
D. Other Jurisdictions
This issue concerning this taxpayer has been presented to courts in other states, with differing results. Compare Ex parte HealthSouth Corp., 978 So.2d 745, 748-50 (Ala.2007) (statutory terms "error" and "mistake" did not include intentional dishonesty; taxpayer was not entitled to a refund for taxes paid on fictitious property under equitable principles), with HealthSouth Corp. v. Levin, 903 N.E.2d at 1184-85 (Ohio statute mandates refunds unless the reason for refusal appears in the statute; equitable principles did not apply; HealthSouth entitled to refund if it can prove its case). A reading of these cases makes clear that their results depend directly on the language employed in their statutes.
E. Conclusion
Generally, tax provisions are technical laws not subject to equitable principles. Shell Western E & P, Inc. v. Dolores County Bd. of Comm'rs, 948 P.2d 1002, 1007 (Colo.1997). However, there are exceptions, including when, in a tax abatement and refund case, the application of equitable principles is necessary to avoid an unjust result occasioned by strict application of a statute of limitations. Id.
It is my view that the General Assembly created an equitable exception to a taxpayer's statutory right to pursue a tax abatement and refund in section 39-5-116(2)(c). The phrase "dependent upon the basis of [the] claim" qualifies the statutory right. I conclude that this phrase authorizes the decision maker, in situations such as these involving "false, erroneous, or misleading" information, to apply equitable principles when examining the reason for providing such information. See Shell Western E & P, 948 P.2d at 1010 ("The application of the doctrine of equitable tolling requires an inquiry into the cireumstances of the delay that prompted the statute of limitations to be invoked.")
By specifically including the phrase "dependent upon the basis of [the] claim," I believe that section 89-5-116(2)(c) places Colorado squarely in the analytical camp occupied by the majority of the Alabama Supreme Court in HealthSouth Corp. Thus, because our legislature has made clear that the nature of the claim for an abatement and refund should determine whether a taxpayer has a right to pursue administrative remedies, I am persuaded by the majority opinion in HealthSouth Corp. that we should apply equitable principles in situations such as these.
The majority in HealthSouth Corp. reached its decision relying on language from Stone v. White, 301 U.S. 532, 535, 57 S.Ct. 851, 81 L.Ed. 1265 (1937):
The statutes authorizing tax refunds and suits for their recovery are predicated upon the same equitable prineiples that underlie an action in assumpsit for money had and received. Since, in this type of action, the plaintiff must recover by virtue of a right measured by equitable standards, it follows that it is open to the defendant to show any state of facts which, according to those standards, would deny the right, even without resort to the modern statutory authority for pleading equitable defenses in actions which are more strictly legal.
Id. (citations omitted), quoted in HealthSouth Corp., 978 So.2d at 754. I think this language is particularly persuasive because our supreme court indicated that the tax abatement and refund remedy "recognized some actions in equity under the "traditional equity head of fraud"" Board of Assessment Appeals v. Benbrook, 735 P.2d at 863.
Here, HealthSouth's hands are unclean because its intentionally improper conduct had "an immediate and necessary relation to the claim under which relief is sought." See Colorado Korean Ass'n v. Korean Senior Ass'n, 151 P.3d 626, 629 (Colo.App.2006). I would, therefore, deny HealthSouth its statutory right to seek administrative relief because
*977[tlhe guiding doctrine in this case is the equitable maxim that "he who comes into equity must come with clean hands." This maxim is far more than a mere banality. It is a self-imposed ordinance that closes the doors of a court of equity to one tainted with inequitableness or bad faith relative to the matter in which he seeks relief, however improper may have been the behavior of the defendant. That doctrine is rooted in the historical concept of court of equity as a vehicle for affirmatively enfore-ing the requirements of conscience and good faith. This presupposes a refusal on its part to be "the abetter of iniquity." Thus while "equity does not demand that its suitors shall have led blameless lives" as to other matters, it does require that they shall have acted fairly and without fraud or deceit as to the controversy in issue.
Precision Instrument Mfg. Co. v. Automotive Maintenance Machinery Co., 324 U.S. 806, 814-15, 65 S.Ct. 993, 89 L.Ed. 1381 (1945) (quoting Bein v. Heath, 47 U.S. 228, 247, 6 How. 228, 12 L.Ed. 416 (1848), and Loughran v. Loughran, 292 U.S. 216, 229, 54 S.Ct. 684, 78 L.Ed. 1219 (1934)) (citations omitted).
I would conclude differently if the misrepresentations had been a product of innocent mistakes, or even simple negligence. I would also view this case differently if the County had contributed to this situation through its own mistakes, negligence, or misconduct. And, although I recognize that many of HealthSouth's shareholders are also victims of its misconduct who may be entitled to relief of their own in a different proceeding, the interests I have identified above weigh, on my scale, in favor of denying HealthSouth the relief it seeks here.
I would conclude, as did the Alabama Civil Court of Appeals in HealthSouth Corp. v. Jefferson County Tax Assessor, 978 So.2d 737, 744 (Ala.Civ.App.2006), the decision affirmed by the Alabama Supreme Court opinion cited above, that:
HealthSouth cannot intentionally provide the tax assessor with misleading information in furtherance of a fraudulent scheme, allow the tax assessor to depend on this information in making the assessment, let the assessment stand while it benefits from the fraudulent scheme, and then change its position and request a refund of the taxes when the fraud is discovered and is no longer profitable.