American Martial Arts Foundation v. Board of Assessment Review for the City of Portland

• Court: Superior Court of Maine
• Decided: July 21, 2006
• Docket: CUMap-05-42
• Status: Unpublished

Opinion

STATE OF MAINE . SUPERIOR COURT .. . q

CUMBERLAND, ss. CIVIL ACTION Docket No. AP-05-42 J . . . . .: _1 ..- . I . :;;;*& i .J . ,.. I . . .;j:C ,; r . ' l j ' ~ ~ ! ~ ~ AMERICAN MARTIAL ARTS FOUNDATION,

Plaintiff,

ORDER

RICHARD BLACKBURN and BOARD OF ASSESSMENT REVIEW for THE CITY OF PORTLAND,

Defendants.

Before the court is a Rule 80B appeal by plaintiff American Martial Arts

Foundation from a Ju:ne 15, 2005 decision by Portland's Board of Assessment Review

denying AMAF's application for a property tax exemption for fiscal years 2000-2005.

The Board decided that the Foundation is not a "literary institution" entitled to a

property tax exemption under 36 M.R.S. 5 652. (R. 309-10). The issue on appeal is

whether that decision is supported by substantial evidence.'

The same issue has been raised administratively and in the courts in a series of

prior proceedings. In 1995 the Superior Court (Mills, J.) concluded that the evidence

did not establish that the literary pursuits of the Foundation were of "a primary or

substantial character" and upheld the Board's denial of an exemption. American

Martial Arts Foundation v. C i k of Portland, Docket No. CV-94-836 (Superior Court,

Cumberland County, May 17, 1995) (R. 93-95). That decision was affirmed in a

memorandum decision. by the Law Court on January 24, 1996. American Martial Arts

Foundation v. Citv of Portland, Decision No. 7533, Law Docket No. CUM-95-354. (R.

' The governing statute provides that real and personal property "owned and occupied or used solely for their own purposes by literary and scientific institutions" is exempt from taxation. 36 M.R.S. 5 652(1)(B). In July 1996 the Board of Assessment Review again considered and denied an

exemption application by the Foundation. (R. 129-31). That decision does not appear to

have been appealed.

On September 15,1999 the Board of Assessment Review considered and denied a

third exemption appllication by the Foundation for the 1999-2000 tax year. (R. 104-05).

That decision was appealed to the Superior Court, which affirmed the Board's decision

on May 31, 2002. American Martial Arts Foundation v. Ciiy of Portland, Docket No.

AP-99-86 (Superior Court, Cumberland County) (Humphrey, J.) (R. 33-36). An appeal

from that decision was dismissed by the Law Court as untimely. (R. 102).

The record in this case consists almost entirely of the material previously

submitted on the 1999 appeal. The court has reviewed the record and has very little to

add to the decisions of Justices Mills and Humphrey and the Law Court's 1996

memorandum. The American Martial Arts Foundation may be an educational

institution but to qua1:ify for an exemption under 5 652(1)(B),it must also qualify as a

"literary" institution - i.e., it must show that its literary pursuits are "of a primary or

substantial character" and not merely "incidental." Hurricane Island Outward Bound

v. Town of Vinalhaven, 372 A.2d 1043,1046 (Me. 1977).

On appeal the issue is whether the Board's decision denying exemption (R. 309-

10) is supported by substantial evidence in the record. The Foundation cannot prevail

unless, based on the ~*ecord,the Board was compelled to find that the Foundation

qualified as a literary institution within the meaning of the statute. Simply stated, the

Board was not compelled to find that the Foundation is a literary institution when it

describes itself as follovts:

Areas in which instruction is given include: traditional punching (open and closed hand techruques) and kicking, Kata (patterns or "forms"), classical weaponry, joint locks and manipulation, tumbling and falling, take-downs, throws,, and sweeps, pressure points, grappling, sparring, street slelf defense, and disarm techniques.

(R. 210).

The Foundation points out that the Hurricane Island Outward Bound decision

suggests that to qualify as a literary institution the literary pursuits of an institution

must be "of a primary substantial character" (emphasis added by the Foundation),

and it argues that "substantial" is a lower hurdle to meet than "primary." There are

two problems with this argument. First, the Hurricane Island Outward Bound decision,

read in its entirety, alppears to equate the terms "primary" and "substantial." See 373

A.2d at 1046, quoting New Endand Theosophical Corp. v. C i b of Boston, 51 N.E. 456,

457 (Mass. 1898). Inldeed, in Hurricane Island Outward Bound, where the issue was

whether the taxpayer was a "scientific" institution, the Law Court concluded its opinion

by stating that "science is not [Outward Bound's] primary object and hence it is not

entitled to enjoy imrrlunity . . . from the tax imposed." 373 A.2d at 1047 (emphasis

added).

Second, the Board's June 15,2005 decision incorporated the findings in its earlier

decision on September 15, 1999 by reference. (R. 310). The 1999 Board decision found

that the Foundation's literary pursuits "were not of a primary or substantial character."

(R. 105).2 Even if "substantial" is a lower threshold than "primary," therefore, the

requisite finding was rnade here.

In the court's view, literature need not be "the" primary object of an institution

for it to be exempt under 36 M.R.S. 5 652(1)(B),but literary pursuits must be more than

2 Pages 104 through 108 of the record are repeated twice. The Board's September 15,1999 decision begins on the first R. 104. incidental. In this ca.se the record is sufficient to support a finding that any literary

pursuits of the Foundation are incidental to its other activities and objectives.

The entry shall be:

The decision od the Board of Assessment Review denying plaintiff's application

for property tax exemption is affirmed. The clerk is directed to incorporate this order in

the docket by reference pursuant to Rule 79(a).

DATED: July 2l' ,2006

c D. Thomas Warren Justice, Superior Court Date Filed JULY 15, 2005 CUMBERLAND Docket No. County

Action 80B APPEAI.

AMERICAN MARTIAL ARTS FOUNDATION RICHARD W. BLACKBURN BOARD OF ASSESSMENT REVIEW FOR THE CITl OF PORTLAND THE CITY OF PORTLAND

VS. Plaintiff's Attorney Defendant's Attorney PAUL ARANSON, ESQ. GARY C. WOOD, ESQ. 1038 MAIN ST Office of Corporation Counsel PO BOX 929 389 Congress Street (City of Portland C Portland, Maine 04101 Blackburn) SANFORD, ME 04073 (207)324-4198 874-8480