Supreme Court
No. 2022-122-M.P. (A.A. 22-4)
Fuller Mill Realty, LLC :
v. :
Rhode Island Department of : Revenue Division of Taxation.
NOTICE: This opinion is subject to formal revision before publication in the Rhode Island Reporter. Readers are requested to notify the Opinion Analyst, Supreme Court of Rhode Island, 250 Benefit Street, Providence, Rhode Island 02903, at Telephone (401) 222-3258 or Email opinionanalyst@courts.ri.gov, of any typographical or other formal errors in order that corrections may be made before the opinion is published. Supreme Court
Present: Suttell, C.J., Goldberg, Robinson, Lynch Prata, and Long, JJ.
OPINION
Justice Robinson, for the Court. This case is before this Court pursuant to
the grant of a petition for certiorari which was filed on May 2, 2022 by the defendant,
the Rhode Island Department of Revenue Division of Taxation (the Division). The
Division sought review of the April 11, 2022 order of the District Court denying the
Division’s motion to dismiss the January 11, 2022 appeal filed by the plaintiff, Fuller
Mill Realty, LLC (Fuller Mill). The Division contended that the hearing judge erred
in denying its motion because, in its view, he (1) ignored the terms of the settlement
agreement and (2) “wrongfully found that [Fuller Mill] was entitled to an
administrative hearing” before the Division. This Court granted the petition for
certiorari on May 2, 2023.
The parties were directed to appear before the Supreme Court and show cause -1- why the issues raised by the parties should not be summarily decided. After
considering the parties’ written and oral submissions, and after carefully reviewing
the record, we conclude that cause has not been shown and that this case may be
decided without further briefing or argument. For the reasons set forth in this
opinion, we quash the order of the District Court and remand for entry of an order
dismissing the case.
I
Facts and Travel
This case involves the Rhode Island Historic Preservation Tax Credits
Program, which program is administered by the Division. Under the program,
applicants which “incur qualified rehabilitation expenditures for the substantial
rehabilitation of certified historic structures” and which satisfy certain requirements
receive a tax credit for state income tax purposes. See G.L. 1956 § 44-33.6-4. Fuller
Mill, an applicant which satisfied the initial criteria, entered into an historic tax credit
agreement with the Division on June 9, 2016 (the original agreement) relative to a
project known as the George H. Fuller Building Project.
On July 10, 2018, the Division notified Fuller Mill that, because quarterly
reports “indicated that the project had remained idle for more than six (6) months,”
Fuller Mill had “forfeited its rights, claims, and entitlement to any historic tax credits
for its project.” Fuller Mill protested the forfeiture, and administrative proceedings
-2- commenced. Fuller Mill provided the Division with “supplemental documentation
indicating that the project did not remain idle,” and both parties then entered into a
“Stipulation of Settlement and Dismissal” on August 6, 2019, which reinstated
Fuller Mill’s historic tax credits.
Fuller Mill continued work on the project, but it “was further delayed due to
the impacts of the global COVID-19 pandemic.” On November 18, 2020, the
Division notified Fuller Mill that its “tax credits were being rescinded” because it
had failed to complete the project by the May 2018 completion date required by the
original agreement. Fuller Mill protested and requested an administrative hearing in
order to challenge the rescission.
In April 2021, the parties entered into another “Stipulation of Settlement and
Dismissal” (the April 2021 stipulation), which extended to November 9, 2021 the
date by which Fuller Mill would be required to complete substantial construction.
The April 2021 stipulation further stated that Fuller Mill’s failure to meet the
deadline would “result in the forfeiture of all rights, claims and entitlements to the
tax credits”—and, significantly, it also specifically stated that “[s]uch forfeiture will
not be subject to appeal.” Also included in the April 2021 stipulation was a provision
entitled “Waiver of Hearing,” which reads as follows:
-3- “By agreeing to resolve this matter through the execution of this Stipulation, the Applicant knowingly and voluntarily waives any right to an administrative hearing on the underlying merits of the administrative action and waives any right to pursue an appeal to the District Court * * *.”
On December 1, 2021, the Division informed Fuller Mill by letter that, as a
result of its failure to abide by the terms of the April 2021 stipulation by the
November 9, 2021 deadline, Fuller Mill “no longer has tax credits available * * *.”
On December 7, 2021, Fuller Mill requested a hearing before the tax administrator
to establish that it should be excused from timely performance due to force majeure.1
It contended that, although it had “waived its right to appeal whether or not it ha[d]
spent [the required amount] by November 9, 2021, it ha[d] not waived its right to a
hearing to determine if the Division of Taxation was correct to revoke the * * * tax
credits.” The Division denied the request for a hearing on December 22, 2021.
On January 11, 2022, Fuller Mill filed an appeal in the District Court,
contending that it had not requested a hearing for the purpose of appealing the
Division’s decision that Fuller Mill had not met the terms of the April 2021
stipulation, but rather “to determine whether the performance * * * was excused by
1 Force majeure has been defined as “[a]n event or effect that can be neither anticipated nor controlled; esp., an unexpected event that prevents someone from doing or completing something that he or she had agreed or officially planned to do.” Black’s Law Dictionary 788 (11th ed. 2019).
-4- force majeure.” Fuller Mill further asserted that the “Division does not have the
discretion to deny the request for a hearing pursuant to [G.L. 1956] § 44-1-32.”2
On February 2, 2022, the Division filed in the District Court a motion to
dismiss the appeal pursuant to Rule 12(b)(6) of the District Court Civil Rules. The
Division argued that, according to the “clear and unambiguous” terms of the April
2021 stipulation, Fuller Mill had “expressly waived its right to appeal the forfeiture
of its tax credits, and waived its right to an administrative hearing and administrative
appeal in District Court.”
On April 5, 2022, a hearing on the Division’s motion to dismiss was held, at
the conclusion of which the hearing judge denied said motion. He concluded,
somewhat opaquely, that § 44-1-32 did not allow the Division to “ex parte make a
decision * * * that the requirements were not fulfilled as to the stipulation and that
2 General Laws 1956 § 44-1-32 states:
“Any taxpayer aggrieved by the action of the tax administrator in determining the amount of any tax, any surcharge that is required to be remitted to the tax division pursuant to § 39-21.1-14 or penalty for which a hearing is not provided may apply to the tax administrator, in writing, within thirty (30) days after notice of the assessment is mailed to the taxpayer, for a hearing relative to the tax or penalty.
Free access — add to your briefcase to read the full text and ask questions with AI
Supreme Court
No. 2022-122-M.P. (A.A. 22-4)
Fuller Mill Realty, LLC :
v. :
Rhode Island Department of : Revenue Division of Taxation.
NOTICE: This opinion is subject to formal revision before publication in the Rhode Island Reporter. Readers are requested to notify the Opinion Analyst, Supreme Court of Rhode Island, 250 Benefit Street, Providence, Rhode Island 02903, at Telephone (401) 222-3258 or Email opinionanalyst@courts.ri.gov, of any typographical or other formal errors in order that corrections may be made before the opinion is published. Supreme Court
Present: Suttell, C.J., Goldberg, Robinson, Lynch Prata, and Long, JJ.
OPINION
Justice Robinson, for the Court. This case is before this Court pursuant to
the grant of a petition for certiorari which was filed on May 2, 2022 by the defendant,
the Rhode Island Department of Revenue Division of Taxation (the Division). The
Division sought review of the April 11, 2022 order of the District Court denying the
Division’s motion to dismiss the January 11, 2022 appeal filed by the plaintiff, Fuller
Mill Realty, LLC (Fuller Mill). The Division contended that the hearing judge erred
in denying its motion because, in its view, he (1) ignored the terms of the settlement
agreement and (2) “wrongfully found that [Fuller Mill] was entitled to an
administrative hearing” before the Division. This Court granted the petition for
certiorari on May 2, 2023.
The parties were directed to appear before the Supreme Court and show cause -1- why the issues raised by the parties should not be summarily decided. After
considering the parties’ written and oral submissions, and after carefully reviewing
the record, we conclude that cause has not been shown and that this case may be
decided without further briefing or argument. For the reasons set forth in this
opinion, we quash the order of the District Court and remand for entry of an order
dismissing the case.
I
Facts and Travel
This case involves the Rhode Island Historic Preservation Tax Credits
Program, which program is administered by the Division. Under the program,
applicants which “incur qualified rehabilitation expenditures for the substantial
rehabilitation of certified historic structures” and which satisfy certain requirements
receive a tax credit for state income tax purposes. See G.L. 1956 § 44-33.6-4. Fuller
Mill, an applicant which satisfied the initial criteria, entered into an historic tax credit
agreement with the Division on June 9, 2016 (the original agreement) relative to a
project known as the George H. Fuller Building Project.
On July 10, 2018, the Division notified Fuller Mill that, because quarterly
reports “indicated that the project had remained idle for more than six (6) months,”
Fuller Mill had “forfeited its rights, claims, and entitlement to any historic tax credits
for its project.” Fuller Mill protested the forfeiture, and administrative proceedings
-2- commenced. Fuller Mill provided the Division with “supplemental documentation
indicating that the project did not remain idle,” and both parties then entered into a
“Stipulation of Settlement and Dismissal” on August 6, 2019, which reinstated
Fuller Mill’s historic tax credits.
Fuller Mill continued work on the project, but it “was further delayed due to
the impacts of the global COVID-19 pandemic.” On November 18, 2020, the
Division notified Fuller Mill that its “tax credits were being rescinded” because it
had failed to complete the project by the May 2018 completion date required by the
original agreement. Fuller Mill protested and requested an administrative hearing in
order to challenge the rescission.
In April 2021, the parties entered into another “Stipulation of Settlement and
Dismissal” (the April 2021 stipulation), which extended to November 9, 2021 the
date by which Fuller Mill would be required to complete substantial construction.
The April 2021 stipulation further stated that Fuller Mill’s failure to meet the
deadline would “result in the forfeiture of all rights, claims and entitlements to the
tax credits”—and, significantly, it also specifically stated that “[s]uch forfeiture will
not be subject to appeal.” Also included in the April 2021 stipulation was a provision
entitled “Waiver of Hearing,” which reads as follows:
-3- “By agreeing to resolve this matter through the execution of this Stipulation, the Applicant knowingly and voluntarily waives any right to an administrative hearing on the underlying merits of the administrative action and waives any right to pursue an appeal to the District Court * * *.”
On December 1, 2021, the Division informed Fuller Mill by letter that, as a
result of its failure to abide by the terms of the April 2021 stipulation by the
November 9, 2021 deadline, Fuller Mill “no longer has tax credits available * * *.”
On December 7, 2021, Fuller Mill requested a hearing before the tax administrator
to establish that it should be excused from timely performance due to force majeure.1
It contended that, although it had “waived its right to appeal whether or not it ha[d]
spent [the required amount] by November 9, 2021, it ha[d] not waived its right to a
hearing to determine if the Division of Taxation was correct to revoke the * * * tax
credits.” The Division denied the request for a hearing on December 22, 2021.
On January 11, 2022, Fuller Mill filed an appeal in the District Court,
contending that it had not requested a hearing for the purpose of appealing the
Division’s decision that Fuller Mill had not met the terms of the April 2021
stipulation, but rather “to determine whether the performance * * * was excused by
1 Force majeure has been defined as “[a]n event or effect that can be neither anticipated nor controlled; esp., an unexpected event that prevents someone from doing or completing something that he or she had agreed or officially planned to do.” Black’s Law Dictionary 788 (11th ed. 2019).
-4- force majeure.” Fuller Mill further asserted that the “Division does not have the
discretion to deny the request for a hearing pursuant to [G.L. 1956] § 44-1-32.”2
On February 2, 2022, the Division filed in the District Court a motion to
dismiss the appeal pursuant to Rule 12(b)(6) of the District Court Civil Rules. The
Division argued that, according to the “clear and unambiguous” terms of the April
2021 stipulation, Fuller Mill had “expressly waived its right to appeal the forfeiture
of its tax credits, and waived its right to an administrative hearing and administrative
appeal in District Court.”
On April 5, 2022, a hearing on the Division’s motion to dismiss was held, at
the conclusion of which the hearing judge denied said motion. He concluded,
somewhat opaquely, that § 44-1-32 did not allow the Division to “ex parte make a
decision * * * that the requirements were not fulfilled as to the stipulation and that
2 General Laws 1956 § 44-1-32 states:
“Any taxpayer aggrieved by the action of the tax administrator in determining the amount of any tax, any surcharge that is required to be remitted to the tax division pursuant to § 39-21.1-14 or penalty for which a hearing is not provided may apply to the tax administrator, in writing, within thirty (30) days after notice of the assessment is mailed to the taxpayer, for a hearing relative to the tax or penalty. The tax administrator shall, as soon as practicable, fix a time and place for the hearing and shall, after the hearing, determine the correct amount of the tax, interest, and penalty.”
-5- there was not potentially a justifiable reason.” An order denying the Division’s
motion to dismiss was entered on April 11, 2022. The Division thereafter filed a
petition for writ of certiorari, which this Court granted on May 2, 2023.
II
Standard of Review
On the relatively rare occasions when we review by certiorari interlocutory
decisions regarding the denial of a Rule 12(b)(6) motion to dismiss, we apply the
same standards that we apply when reviewing the grant of such a motion.3 Imperial
Casualty and Indemnity Company v. Bellini, 746 A.2d 130, 132 (R.I. 2000)
(“Generally, we decline to review on certiorari interlocutory decisions such as the
denial of a motion to dismiss * * *. In those limited circumstances in which we issue
the writ, we apply on review the same standard as that applied in reviewing the grant
of such a motion.”) (citation omitted). In conducting our review pursuant to the
provisions of Rule 12(b)(6), we apply the same standards applied by the hearing
justice. See Rein v. ESS Group, Inc., 184 A.3d 695, 699 (R.I. 2018); Goddard v. APG
Security-RI, LLC, 134 A.3d 173, 175 (R.I. 2016). In doing so, we limit our review
to the complaint, assume that the facts and allegations in the complaint are true, and
3 Rule 12(b)(6) of the District Court Civil Rules is identical to Rule 12(b)(6) of the Superior Court Rules of Civil Procedure; we may look to cases interpreting one when interpreting the other. See Apex Oil Company, Inc. v. State, 297 A.3d 96, 107 n.9 (R.I. 2023). -6- view them in the light most favorable to the plaintiff. Pontarelli v. Rhode Island
Department of Elementary and Secondary Education, 176 A.3d 472, 476
(R.I. 2018). However, the rule that we limit our review to the allegations in the
complaint is not absolute. We have recognized “a narrow exception for documents
the authenticity of which are not disputed by the parties; for official public records;
for documents central to plaintiffs’ claim; or for documents sufficiently referred to
in the complaint.” EDC Investment, LLC v. UTGR, Inc., 275 A.3d 537, 542-43
(R.I. 2022) (internal quotation marks omitted). A motion to dismiss may be granted
only “if it appears beyond a reasonable doubt that a plaintiff would not be entitled
to relief under any conceivable set of facts.” Pontarelli, 176 A.3d at 476 (deletion
omitted) (quoting Multi-State Restoration, Inc. v. DWS Properties, LLC, 61 A.3d
414, 416 (R.I. 2013)).
III
The Contentions of the Parties
The Division argues that the terms of the April 2021 stipulation “are valid and
binding, and [Fuller Mill’s] Complaint is barred as a result.” It emphasizes that
“[t]he plain, unambiguous, and unmistakable language of the waivers states that
Fuller [Mill] waived its right to an administrative hearing on the merits of the
administrative action and any right to appeal to District Court.” The Division further
contends that, in holding that Fuller Mill was entitled to an administrative hearing,
-7- the hearing judge ignored the impact of both the April 2021 stipulation and “the
relevant statutes and regulations.”4 The Division also contends that the original
agreement’s force majeure exception “was not intended to apply to [Fuller Mill’s]
forfeiture of the tax credits for its failure to meet the Substantial Construction
deadline.”5 It is the Division’s position that “[t]he clear intent of the mandatory
terms used by the parties demonstrates that the forfeiture for failing to meet the
Substantial Construction deadline is final, not subject to excusal by a reason of a
force majeure and, most importantly, not subject to appeal.”
4 The controlling statute is § 44-1-32. See footnote 2, supra. The controlling regulation is 280 RICR 20-20-6.18, which reads in pertinent part as follows:
“Any Person aggrieved by the Division of Taxation’s denial of a tax credit or tax benefit under this program shall notify the Division of Taxation in writing, within thirty (30) days from the date of mailing of the notice of denial of the tax credit, and request a hearing relative to the denial of the tax credit. The Division of Taxation shall, as soon as is practicable, set a time and place for hearing, and shall render a final decision.” 5 The force majeure clause in the original agreement reads as follows:
“To be deemed an event of force majeure, the cause of the event must be (i) reasonably unforeseen, (ii) outside the control of the Applicant and (iii) could not be avoided by the Applicant’s exercise of due care. By way of example, and not in limitation, any delays, work stoppages, or work force reductions caused by financial difficulties, labor disputes or violation of the law shall be deemed to cause the Project to Remain Idle.” -8- Fuller Mill contends that the April 2021 stipulation did not contain “a global
waiver” of its right to a hearing; it argues that conferring an “unfettered discretion”
on the Division to revoke tax credits “was outside of the parties’ contemplations
* * *.” Fuller Mill further contends that the hearing judge “properly held that [the
Division] lacked any discretion to refuse [Fuller Mill’s] timely request for a hearing
* * *.” Fuller Mill asserts that “the applicable statutory and regulatory provisions”
(viz., § 44-1-32 and 280 RICR 20-20-6.18) are “unambiguous and must be applied
literally.” Fuller Mill contends that, in light of these provisions, the Division “lacks
the authority to deny a request for a hearing” because they “clearly compel the
[Division] to provide that hearing and do not afford the [Division] with any
discretion to refuse the request.” In addition, Fuller Mill states that the April 2021
stipulation “does not contain an express waiver or modification which would have
limited the applicability of [the force majeure clause] to only the Project Completion
date and not to Substantial Completion.” Fuller Mill states that “the provisions in
the [original agreement] that are consistent with the [April 2021 stipulation] were
not modified” and that, therefore, the force majeure clause is not inconsistent with
the terms of the April 2021 stipulation because it “does not state that [Fuller Mill] is
precluded from invoking [the force majeure clause] as to Substantial Completion.”
-9- IV
Analysis
In determining whether contract terms, such as those in the April 2021
stipulation, are ambiguous, “we give words their plain, ordinary, and usual
meaning.” Chariho Regional School District, by and through Chariho Regional
School Committee v. State, 207 A.3d 1007, 1015 (R.I. 2019) (quoting Botelho v. City
of Pawtucket School Department, 130 A.3d 172, 176 (R.I. 2016)). If we do not
discern any contractual ambiguity, “our judicial role becomes quite straightforward:
the plain language * * * is to be applied.” Papudesu v. Medical Malpractice Joint
Underwriting Association of Rhode Island, 18 A.3d 495, 498 (R.I. 2011). Moreover,
“[t]he subjective intent of the parties may not properly be considered by the Court;
rather, we consider the intent expressed by the language of the contract.” Derderian
v. Essex Insurance Co., 44 A.3d 122, 128 (R.I. 2012) (internal quotation marks
omitted). When a contract is unambiguous, “we simply consider the dictates of the
plain language in the contract.” Papudesu, 18 A.3d at 498.
We have carefully examined the language in the April 2021 stipulation at issue
in this case, which states that Fuller Mill “knowingly and voluntarily waives any
right to an administrative hearing on the underlying merits of the administrative
action and waives any right to pursue an appeal to the District Court * * *.”
(Emphasis added.) We consider the meaning of those words to be unambiguous,
- 10 - straightforward, and readily understandable. The incontestable fact is that Fuller
Mill “knowingly and voluntarily” waived its right to both an administrative hearing
and to a District Court appeal with respect to the Division’s determination that Fuller
Mill’s tax credit rights had been forfeited. Although that language clearly waives
certain rights of which Fuller Mill otherwise could have availed itself, that is
precisely what the April 2021 stipulation provides. See Papudesu, 18 A.3d at 498
(“[W]e do not actually construe an unambiguous contract; we simply consider the
dictates of the plain language in the contract.”); see also F.D. McKendall Lumber
Co. v. Kalian, 425 A.2d 515, 518 (R.I. 1981). In our judgment, the terms of the
April 2021 stipulation are clear, and they must be applied as they are written. See
Young v. Warwick Rollermagic Skating Center, Inc., 973 A.2d 553, 560 (R.I. 2009)
(“When * * * we are confronted with unambiguous contractual words, what is
claimed to have been the subjective intent of the parties is of no moment.”); Gorman
v. Gorman, 883 A.2d 732, 739 n.11 (R.I. 2005) (“Under established contract law
principles, when there is an unambiguous contract and no proof of duress or the like,
the terms of the contract are to be applied as written.”); W.P. Associates v. Forcier,
Inc., 637 A.2d 353, 356 (R.I. 1994). Accordingly, it is our view that the hearing
judge erred in denying the Division’s motion to dismiss.
- 11 - V
Conclusion
For the reasons set forth in this opinion, we quash the order of the District
Court denying the Division’s motion to dismiss, and we remand the case to the
District Court with directions that it enter an order dismissing the case.
- 12 - STATE OF RHODE ISLAND SUPREME COURT – CLERK’S OFFICE Licht Judicial Complex 250 Benefit Street Providence, RI 02903
OPINION COVER SHEET
Fuller Mill Realty, LLC v. Rhode Island Department Title of Case of Revenue Division of Taxation. No. 2022-122-M.P. Case Number (A.A. 22-4)
Date Opinion Filed May 2, 2024
Suttell, C.J., Goldberg, Robinson, Lynch Prata, and Justices Long, JJ.
Written By Associate Justice William P. Robinson III
Source of Appeal Sixth Division District Court
Judicial Officer from Lower Court Associate Justice Christopher Smith
For Plaintiff:
Marc DeSisto, Esq. Attorney(s) on Appeal For Defendant:
Nicholas J. Hemond, Esq.
SU-CMS-02A (revised November 2022)