632.1. Declaratory Judgment.
In addition to the appeal process within DOR and to the ATB, taxpayers have brought other civil actions to prevent the assessment or collection of tax.
632.1. Declaratory Judgment
Within their respective jurisdictions, the SJC, the Superior Court and the Probate Courts may make binding declarations of right, duty, status and other legal relations between the parties to an actual controversy. See G.L. c. 231A, § 1 et seq. In the tax field, actions for declaratory judgment are generally brought to test the legality of a statute, a regulation or administrative practice. See G.L. c. 231A, § 2.
Due to the existence of statutory abatement and appeals procedures, the majority of cases involving the assessment of tax are inappropriate for declaratory judgment. Curran v. Commissioner of Rev., 23 Mass.App.Ct. 965 (1987). Declaratory relief is only appropriate when an actual controversy exists and the dispute is legal, rather than factual. Where a taxpayer has not exhausted available administrative remedies, a court will not entertain an action for declaratory judgment "unless the administrative remedies are 'seriously inadequate' or the case involves novel questions (of law), repetitive problems or the public interest." I.S.K. Con of New England, Inc. v. Boston, 19 Mass.App.Ct. 327, 330 (1985), quoting Sydney v. Commissioner of Corps. & Taxn., 371 Mass. 289, 294 (1976). DOR will typically strenuously oppose an action for declaratory judgment.
A filing for declaratory relief is governed by the Massachusetts Rules of Civil Procedure. The taxpayer must serve the summons and complaint on both the Commissioner of Revenue and the Boston Office of the Attorney General. See Mass. R. Civ. P. Rule 4(d)(3).
G.L. c. 231A, § 1 et seq.
Massachusetts Rules of Civil Procedure, 4(d)(3), 57
Curran v. Commissioner of Rev., 23 Mass.App.Ct. 965 (1987);
I.S.K. Con of New England, Inc. v. Boston, 19 Mass.App.Ct. 327, 330 (1985), quoting Sydney v. Commissioner of Corps. & Taxn., 371 Mass. 289, 294 (1976)
Under the Massachusetts Rules of Civil Procedure (Mass.R.Civ.P. 65), taxpayers have sought temporary restraining orders (TRO) or preliminary injunctions in the Superior or Probate Court in an effort to stop some action undertaken by DOR. In general, a TRO or preliminary injunction, if granted, will preserve the status quo while an underlying or related case is being decided on its merits.
To prevail on a motion for a preliminary injunction, a taxpayer must show (1) a substantial likelihood of winning the underlying dispute, (2) a substantial threat of irreparable injury if the injunction is not granted, (3) that the threatened injury to the taxpayer outweighs the harm an injunction may cause to the Commonwealth, and (4) that a preliminary injunction will not be against the public interest. Because of the public interest involved in the integrity of the system for collection of taxes and the various administrative procedures available to taxpayers, however, TROs and preliminary injunctions are rarely granted in tax cases. "Injunctions delaying the collection of tax are not a necessary part of declaratory procedure and caution should be exercised in granting them." Meenes v. Goldberg, 331 Mass. 688, 691 (1954). DOR will typically strenuously oppose actions for injunctions.
A filing for an injunction is governed by the Massachusetts Rules of Civil Procedure. The taxpayer must serve the summons, complaint and motion on both the Commissioner of Revenue and the Boston Office of the Attorney General. See Mass. R. Civ. P. Rule 4(d)(3).
Massachusetts Rules of Civil Procedure, 4(d)(3), 65
Packaging Industries Group, Inc. v. Cheney, 380 Mass. 609 (1980)
Meenes v. Goldberg, 331 Mass. 688, 691 (1954)
Smith & Zobel, Rules Practice § 65.4 (Mass. Practice Series 1981)
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