Code Section Group

Revenue and Taxation Code - RTC

DIVISION 1. PROPERTY TAXATION [50 - 5911]

  ( Division 1 enacted by Stats. 1939, Ch. 154. )

PART 9. CORRECTIONS, CANCELLATIONS, AND REFUNDS [4801 - 5170]

  ( Part 9 enacted by Stats. 1939, Ch. 154. )

CHAPTER 5. Refunds [5096 - 5170]

  ( Chapter 5 enacted by Stats. 1939, Ch. 154. )

ARTICLE 2. Refund Actions by Taxpayers [5140 - 5149.5]
  ( Article 2 repealed and added by Stats. 1976, Ch. 499. )

5140.
  

The person who paid the tax, his or her guardian or conservator, the executor of his or her will, or the administrator of his or her estate may bring an action only in the superior court, but not in the small claims division of the superior court, against a county or a city to recover a tax which the board of supervisors of the county or the city council of the city has refused to refund on a claim filed pursuant to Article 1 (commencing with Section 5096) of this chapter. No other person may bring such an action; but if another should do so, judgment shall not be rendered for the plaintiff.

(Amended by Stats. 2007, Ch. 340, Sec. 10. Effective January 1, 2008.)

5141.
  

(a) An action brought under this article, except an action brought under Section 5148, shall be commenced within six months from and after the date that the board of supervisors or city council rejects a claim for refund in whole or in part.

(b) Except as provided in subdivision (c), if the board of supervisors or city council fails to mail notice of its action on a claim for refund within six months after the claim is filed, the claimant may, prior to mailing of notice by the board of supervisors or city council of its action on the claim, consider the claim rejected and bring an action under this article.

(c) If an applicant for the reduction of an assessment states in the application that the application is intended to constitute a claim for refund pursuant to Section 5097, the claim for refund shall be deemed denied on the date the final installment of the taxes extended on such assessment becomes delinquent or on the date the equalization board makes its final determination on the application, whichever is later.

(Amended by Stats. 1987, Ch. 1262, Sec. 2.)

5142.
  

(a) No action shall be commenced or maintained under this article, except under Section 5148, unless a claim for refund has first been filed pursuant to Article 1 (commencing with Section 5096).

No recovery shall be allowed in any refund action upon any ground not specified in the refund claim.

(b) When the person affected or his or her agent and the assessor stipulate that an application involves only nonvaluation issues, they may file a stipulation with the county board of equalization stating that issues in dispute do not involve valuation questions. To the extent possible, the stipulation shall also indicate the parties’ agreement as to the assessment amounts that would result under their respective positions on the issue or issues in dispute. The board shall accept or reject the stipulation, with or without conducting a hearing on the stipulation. The filing of, and the acceptance by the board of, a stipulation shall be deemed compliance with the requirement that the person affected file and prosecute an application for reduction under Chapter 1 (commencing with Section 1601) of Part 3 in order to exhaust administrative remedies. However, the filing of, and the acceptance by the board of, a stipulation under this subdivision shall not excuse or waive the requirement of a timely filing of a claim for refund.

(c) Nothing in this subdivision shall be construed to deprive the county board of equalization of jurisdiction over nonvaluation issues in the absence of a contrary stipulation.

(Amended by Stats. 1993, Ch. 387, Sec. 8. Effective January 1, 1994.)

5143.
  

If a claim for refund relates only to the validity of a portion of an assessment, an action may be brought under this article only as to that portion.

(Repealed and added by Stats. 1976, Ch. 499.)

5144.
  

If the court finds that an assessment is void in whole or in part, it shall render judgment for the plaintiff for the amount of the taxes paid on that portion of the assessment that is found to be void. The taxes paid on the portion of the assessment not found to be void shall constitute valid taxes which, if paid after delinquency, shall carry penalties, interest, and costs.

(Added by Stats. 1976, Ch. 499.)

5145.
  

(a) Notwithstanding the fact that all taxes on property have not been paid in full, the owner of that property may bring an action under Section 5140 at any time within six months after the rejection of a claim for the first installment under an installment plan of redemption pursuant to Article 2 (commencing with Section 4216) of Chapter 3 of Part 7, if the following requirements are satisfied:

(1) The first installment payment is made within six months of the delinquency of the taxes being paid by installments.

(2) If the balance of the unpaid tax liability remaining after the first installment payment has been made, plus penalties and interest thereon to the date of filing the actions, exceeds 662/3 percent of the full value of the property on which the taxes are a lien, as of the last equalized assessment roll, the taxpayer shall post a bond with the county tax collector in a sum equal to that excess or, in the alternative, pledge other property with the county tax collector in that amount as security. The requirement for a bond or additional security specified in this paragraph shall terminate when the balance of unpaid tax liability remaining after a subsequent installment payment, plus penalties and interest thereon to the date of such subsequent installment payment, no longer exceeds 662/3 percent of the full value of the property on which the taxes are a lien, as of the last equalized assessment roll. However, a new bond shall be posted or property pledged if, during the pendency of the action, the balance of unpaid tax liability, plus penalties and interest thereon, again exceeds 662/3 percent of the full value.

(b) The right to maintain an action under this section shall terminate if there is a default of any obligation by the owner in the installment plan of redemption on the property.

(c) If the owner does not recover the amount of taxes in dispute in an action brought under this section, he or she shall pay additional interest to the county or city equal to the difference between the interest he or she has paid under Article 2 (commencing with Section 4216) of Chapter 3 of Part 7 and the amount of interest the county or city would have earned on the funds in the impound account on the entire amount of tax determined by the court to be due, if the amount had been paid in equal installments on the tax delinquency dates.

(Amended by Stats. 1983, Ch. 1281, Sec. 34. Effective September 30, 1983.)

5145.5.
  

(a) Notwithstanding the fact that all taxes on a property have not been paid in full, the owner of that property may, subject to the limitations set forth in subdivision (d), bring an action in accordance with Section 5140 at any time within six months after the rejection of a claim for the refund of the first installment that is paid under an installment plan for payment of escape assessments that is entered into pursuant to Section 4837.5.

(b) The right to maintain an action pursuant to this section shall terminate if there is a default on the part of the assessee with respect to any obligation in the installment plan for payment of the escape assessment.

(c) If the owner does not recover the amount of taxes in dispute in an action brought under this section, he or she shall pay additional interest to the county or city in an amount equal to the difference between the amount of interest he or she has paid under Section 506 and the amount of interest that the county or city would have earned in the impound account in connection with the entire amount of tax determined by the court to be due if that amount had been paid prior to delinquency.

(d) (1) This section shall not apply in cases where the penalty pursuant to Section 503 has been added to the escape assessment and upheld by the appeals board or the county board of equalization.

(2) This section shall apply to installment plans initiated by written requests filed with the tax collector on or after July 1, 1997.

(Added by Stats. 1997, Ch. 941, Sec. 13. Effective January 1, 1998.)

5146.
  

If all or any portion of the taxes sought to be recovered were collected by officers of the county for a city or cities, an action must be brought against the county for the recovery of those taxes. When an action is filed against a county for taxes collected by the county on behalf of a city or cities, the county shall give notice of that action to the city or cities within 30 days of the county’s receipt of the summons and complaint. A fee shall be payable by the assessee in an amount prescribed by the court to cover the reasonable costs incurred by a county or counties in giving the required notice. Any city receiving notice of the action filed against the county may, within 30 days of the receipt of that notice, intervene in that action. Whether or not a city intervenes in the action, any judgment rendered for an assessee shall be entered exclusively against the county; however, the county shall be entitled to recover separately from the city or cities and other tax entities those taxes collected by the county on behalf of the city or cities and other tax entities which are subject to refund to the assessee as a result of the judgment. Payment to the taxpayer upon the judgment and any interest thereon may be deferred by the county until the apportionment of property tax revenue next following the date of the judgment, or as the county and the taxpayer may otherwise agree. Interest shall accrue during any deferral period unless the county and taxpayer otherwise agree. The county may if it chooses to do so offset the amount of the judgment and interest recoverable by it from the city or cities and other tax entities against amounts held in the county treasury therefor or against amounts due and payable thereto, including, but not limited to, property tax apportionments. The amount of the fee required by this section shall not be recoverable by the assessee in the action and no judgment entered in the action in favor of the assessee shall provide for the recovery of the fee.

As used in this section, “county” includes a city and county.

If all or any portion of the taxes sought to be recovered were levied on state-assessed property, property which the board has found ineligible for the welfare exemption pursuant to Section 254.5, or property as to which the board has reviewed the assessment pursuant to Section 11 of Article XIII of the Constitution, the board shall be joined as a party to the action.

(Added by renumbering Section 5148 by Stats. 1987, Ch. 1262, Sec. 5.)

5147.
  

(a) No refund action hereafter commenced shall be further prosecuted, and no further proceedings shall be had therein, and any refund action hereafter commenced shall be dismissed by the court in which the action was commenced, on the court’s own motion or on the motion of any defendant therein, unless the summons was issued and served and the return thereon was made within one year after the commencement of the action, except where the parties have filed a stipulation in writing that the time may be extended or the party against whom the action is prosecuted has made a general appearance in the action.

(b) For purposes of this section, none of the following constitutes a general appearance in the action:

(1) A stipulation pursuant to Section 583.230 of the Code of Civil Procedure extending the time within which service must be made.

(2) A motion to dismiss made pursuant to this chapter, whether joined with a motion to quash service or a motion to set aside a default judgment, or otherwise.

(3) An extension of time to plead after a motion to dismiss made pursuant to this chapter.

(Amended by Stats. 1990, Ch. 126, Sec. 34. Effective June 11, 1990.)

5148.
  

Notwithstanding Section 5140, an action to recover taxes levied on state-assessed property arising out of a dispute as to an assessment made pursuant to Section 721, including a dispute as to valuation, assessment ratio, or allocation of value for assessment purposes, shall be brought under this section. In any action brought under this section, the following requirements shall apply:

(a) The action shall be brought by the state assessee. There shall be a single complaint with all parties joined therein with respect to disputes for any year.

(b) The action shall name the board and the county or counties. When a county is named which collected taxes on behalf of a city or cities, the county shall give notice of that action to the city or cities within 30 days of receipt of advice from the board of the action. A fee shall be payable by the state assessee in an amount prescribed by the court to cover the reasonable costs incurred by a county or counties in giving that notice. Any city receiving notice of the action filed against the board and the county may, within 30 days of the receipt of that notice, intervene in that action. Whether or not a city intervenes in the action, any judgment rendered for an assessee shall be entered exclusively against the county; however, the county shall be entitled to recover separately from the city or cities and other tax entities those taxes collected by the county on behalf of the city or cities and other tax entities which are subject to refund to the assessee as the result of the judgment. Payment to the taxpayer upon the judgment and any interest thereon may be deferred by the county until the apportionment of property tax revenue next following the date of the judgment, or as the county and the taxpayer may otherwise agree. Interest shall accrue during any deferral period unless the county and taxpayer otherwise agree. The county may if it chooses to do so offset the amount of the judgment and interest recoverable by it from the city or cities and other tax entities against amounts held in the county treasury therefor or against amounts due and payable thereto, including, but not limited to, property tax apportionments. The amount of the fee required by this section shall not be recoverable by the assessee in the action and no judgment entered in the action in favor of the assessee shall provide for the recovery of the fee.

As used in this section, “county” includes a city and county.

(c) Service of the summons and complaint shall be only upon the board. The board shall serve as agent of the defendant county or counties for the purpose of service of process. A fee shall be payable by the state assessee in an amount prescribed by the court to cover all reasonable costs incurred by the board while acting in its capacity as agent for the defendant counties.

(d) Venue of the action shall be in any county in which the Attorney General of California has an office or in which the state assessee has a significant presence.

(e) The action shall be limited in the case of valuation and allocation disputes to the grounds specified in the following:

(1) A petition for reassessment filed under Section 741, or any proceeding thereon.

(2) A petition for correction of allocated assessment filed under Section 747, or any proceeding thereon.

(f) A timely filed petition for reassessment or petition for correction of allocated assessment shall constitute a claim for refund if the petitioner states in the petition it is intended to so serve.

(g) The action shall be commenced only after payment of the taxes in issue and within four years after the latest of the dates that the State Board of Equalization mailed its decision or its written findings and conclusions on the following:

(1) A petition for reassessment filed under Section 741 and intended to constitute a claim for refund.

(2) A petition for correction of allocated assessment filed under Section 747 and intended to constitute a claim for refund.

(h) The action shall not be joined with any action filed under Section 5140.

(i) Any refund of tax overpayments and any interest thereon, determined in any action brought under this section to be due shall be made by the defendant county or counties.

(Added by Stats. 1987, Ch. 1262, Sec. 6.)

5149.
  

All courts wherein actions brought under this part (with the exclusion of actions brought under Section 5148) are or hereafter may be pending shall give those actions precedence over all other civil actions therein, except actions to which special precedence is given by law, in the matter of setting same for hearing or trial, and in hearing the same, to the end that all those actions shall be quickly heard and determined.

(Amended by Stats. 1988, Ch. 1372, Sec. 1.)

5149.5.
  

Where the taxes sought to be recovered have been paid after delinquency, the amount of penalties, interest or costs recoverable in actions brought under this article shall be computed only on the taxes recovered.

(Added by Stats. 1976, Ch. 499.)

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