Summary 2007 WY 43

Summary of Decision issued March 14, 2007

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Case Name: Chevron v. Dep’t of Revenue, State

Citation: 2007 WY 43

Docket Number: 06-50

Appeal from the District Court of Uinta County, the Honorable Dennis L. Sanderson, Judge

Representing Appellant (Petitioner): William J. Thomson II, Randall B. Reed, Brian J. Hanify and Gregory C. Dyekman of Dray, Thomson & Dyekman, PC, Cheyenne, Wyoming. Argument by Mr. Dyekman.

Representing Appellee (Respondent): Patrick J. Crank, Attorney General; Michael L. Hubbard, Deputy Attorney General; Martin L. Hardsocg, Senior Assistant Attorney General; and Karl D. Anderson, Senior Assistant Attorney General. Argument by Mr. Anderson.

Issues: Whether the Wyoming Board of Equalization (SBOE) erred as a matter of law, by concluding that a private postage meter stamp was a “postmark” as that term is used in Wyo. Stat. Ann. § 39-14-209(b)(iv) and in the SBOE’s rules and regulations. Whether Chevron was denied due process by the SBOE’s refusal to accept Chevron’s appeal. Whether the SBOE failed to observe procedures required by law.

Facts/Discussion: The SBOE denied Chevron’s appeal from a notice of valuation (NOV) for its Carter Creek natural gas production, concluding it had no jurisdiction because the appeal was filed more than 30 days after the Department of Revenue (DOR) decision was postmarked in contravention of Wyo. Stat. Ann. § 39-14-209(b)(iv). Chevron claimed the state’s postage meter stamp was not a “postmark” as provided by the statute, and thus its time for appeal had not expired because the thirty day period had not been triggered. Chevron petitioned the district court for review of the SBOE decision and the district court affirmed the agency’s findings and conclusions. Chevron then filed a timely appeal of the district court’s decisions to the Court.
Standard of Review: Wyo. Stat. Ann. § 16-3-114 governs judicial review of administrative decisions.
To resolve the matter, the Court had to interpret the statutory term “postmark.” The term was not defined in the statute. The Court held the term “postmark” as used in § 39-14-209(b)(iv) and the SBOE rule was capable of different meanings and was therefore ambiguous. The Court then looked beyond the specific language of the statute and applied the rules of statutory construction to determine the legislature’s intent. It is indisputable the legislature has the prerogative to decide when to authorize administrative appeals and to establish the procedures applicable to such appeals. The Court reviewed the historical context of the enactment of the statute. They noted from reviewing numerous Wyoming statutes that when the legislature desires an agency to establish proof of actual mailing of a notice and the date thereof, it requires the agency to send the notice by certified or registered mail. The legislature chose not to impose that requirement on the DOR for service of NOV’s. Therefore the Court stated the intent was simply to provide a date certain for the beginning of the appeals period. The state’s private postage meter stamp constitutes a “postmark” for the purposes of § 39-14-209(b)(iv). The Court noted cases which supported the position that a postage meter stamp was equivalent to a USPS cancellation because the meters are subject to USPS regulations and guidelines.
The Court was not convinced the legislature intended to change the way the state and the taxpayers handled their business communication when it established a deadline for filing objections to an NOV; instead it was intended to establish a firm date for triggering the time within which objections must be filed and understood a private postage meter stamp did that just as effectively as a USPS cancellation mark.
Chevron directed the Court’s attention to cases holding that tax statutes, if ambiguous, must be interpreted in favor of the taxpayer. An examination of the cases made it clear the focus was on statutes involving the imposition of a tax and not procedural statutes governing administration of tax appeals. The Court discussed the case of Kelsey v. Taft and the cases that followed which similarly involved interpreting statutes to determine whether a particular property or transaction was subject to taxation or the amount of tax due. The Court would not apply the rule of strict construction to interpret the procedural requirements for perfecting an appeal from an NOV.
The fact that Chevron failed to provide evidence that USPS stamped mail would have likely been received by a taxpayer over the holiday period any faster than the privately metered mail also undermined its position. Without that evidence, it could not claim that requiring a USPS postmark would always benefit the taxpayer.
Fairness and due process are the only constraints upon the legislature when establishing procedural requirements. First, Chevron complained, without cite to authority, that SBOE violated its due process rights arguing W.R.A.P.2.01 applied to SBOE. They implied that SBOE’s failure to grant an extension constituted a denial of due process. The Court stated that SBOE’s dismissal of Chevron’s untimely appeal in compliance with § 39-14-209(b)(iv) did not constitute a denial of due process. Secondly, Chevron contended its right to due process was violated because it did not have an adequate opportunity to respond to the arguments the DOR presented at the hearing or the legal reasoning set forth in SBOE’s order. The Court focused on the chronology of the proceeding when it reviewed the record. The Court agreed the proceedings provided Chevron adequate opportunity to present its case and concluded there was no denial of due process. Chevron had notice of the hearing, filed no objection to the timing of the hearing, presented an opening statement outlining the legal arguments it had raised in its written objection to the dismissal, including some of the authority it cited on appeal, and called a DOR employee to testify. At no time prior to, during, or after the hearing did Chevron object to the DOR’s participation or ask for additional time to present more evidence or legal argument. Not until the SBOE order was issued did Chevron ask to present more evidence and argument. Due process requires only reasonable notice and opportunity for a fair hearing.

Holding: The SBOE mailed the NOV on May 25, 2004 in the ordinary course of its business using the state’s central mail system and a private postage meter. Chevron presented no evidence indicating the mail was not handled in the same manner as all of the DOR’s correspondence and mailed on the day it was stamped. Chevron received the NOV on June 2, 2004. The intervening time included a national holiday during which mail was not delivered. The Court concluded the NOV was postmarked as provided by § 39-14-209(b)(iv) when marked by the postage meter and the appeal was due on June 28, 2004. Chevron’s appeal filed June 30, 2004, was not timely; consequently, the SBOE had no jurisdiction to consider it and acted properly in dismissing it. The Court further concluded Chevron had a full and fair opportunity to present its arguments in opposition to the dismissal of its appeal. The Court affirmed the district court’s order affirming the SBOE’s order dismissing the appeal.

Affirmed.

J. Kite delivered the decision.

Link: http://tinyurl.com/2edps6 .