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DISTRICT OF COLUMBIA COURT OF APPEALS
No. 22-TX-0820
LHL REALTY COMPANY DC LLC, et al., APPELLANTS,
V.
DISTRICT OF COLUMBIA, APPELLEE.
Appeal from the Superior Court of the District of Columbia (2020-CVT-000002)
(Carmen G. McLean, Judge)
(Argued May 7, 2025 Decided June 11, 2026)
Stephanie A. Lipinski Galland, with whom Kyle Wingfield, Sonia Shaikh, and Matthew L. Devendorf were on the briefs, for appellants.
Marcella Coburn, Assistant Attorney General, with whom Brian L. Schwalb, Attorney General for the District of Columbia, Caroline S. Van Zile, Solicitor General, Ashwin P. Phatak, Principal Deputy Solicitor General, Graham E. Phillips and Carl J. Schifferle, Deputy Solicitors General, Richard S. Love, Senior Assistant Attorney General, and Jeremy R. Girton, Assistant Attorney General, were on the briefs, for appellee.
Elbert Lin, Erica N. Peterson, Maria C. Monaghan, and Christopher J. Walker filed a brief on behalf of Chamber of Commerce of the United States of America as amicus curiae.
John J. Vecchione and Mark S. Chenoweth filed a brief on behalf of New Civil Liberties Alliance as amicus curiae. 2
Jonathan H. Levy and Fran Swanson filed a brief on behalf of Legal Aid DC as amicus curiae.
Before MCLEESE, DEAHL, and HOWARD, Associate Judges.
MCLEESE, Associate Judge: Appellants LHL Realty Company DC LLC (the
LLC) and LHL Realty Company (the Partnership), which we refer to collectively as
LHL, appeal from the Superior Court’s grant of summary judgment to appellee the
District of Columbia on the ground that a transfer of real property from the
Partnership to the LLC was a taxable event. We affirm the trial court’s ruling.
I. Factual and Legal Background
A transfer of real property in the District of Columbia generally triggers an
obligation to pay recordation and transfer taxes. D.C. Code §§ 42-1103(a)(1)
(recordation tax), 47-903(a)(1) (transfer tax). The taxes are payable upon recordation
of the deed or other transfer document with the Recorder of Deeds (ROD). D.C.
Code §§ 47-1431(a) (duty to record with ROD), 42-1103(a)(1) (recordation tax),
47-903(a)(1) (transfer tax). Recordation must occur “[w]ithin 30 days after the
execution of a deed or other document by which legal title to real property . . . is
transferred.” D.C. Code § 47-1431(a). The amount of the tax is based on the amount
of consideration paid or required to be paid for the property. D.C. Code
§§ 42-1103(a)(1)(A) (recordation tax of 1.1 percent of consideration), 47-903(a)(1)
(transfer tax of 1.1 percent of consideration), 42-1101(5) (defining “consideration”), 3
47-901(5) (same). If no or nominal consideration is paid or required to be paid for
the real property, however, “the tax shall be based upon the fair market value” of the
property. D.C. Code § 42-1104(a) (recordation tax); see id. § 47-904 (transfer tax).
It is “presumed that all transfers of real property are taxable and the burden
shall be upon the taxpayer to show that a transfer is exempt from tax.” D.C. Code
§ 47-907 (transfer tax); see id. § 42-1107 (recordation tax). Transfers of real
property that occur as part of a merger are taxable. 9 D.C.M.R. § 502.1a (recordation
tax); Vornado 3040 M St. LLC v. District of Columbia, 318 A.3d 1185, 1190-91
(D.C. 2024) (recordation and transfer taxes). Transfers that occur as part of a
conversion are exempt from both recordation and transfer taxes if the conversion
meets certain requirements. D.C. Code § 29-204.06(h).
The following facts appear to be undisputed. The Partnership, which was
based in Virginia, owned a piece of real property in the District. On February 2,
2002, the Partnership and the LLC agreed to “Articles of Merger.” The Articles of
Merger referred to an attached “Agreement and Plan of Merger.” The Articles of
Merger provided that the Partnership adopted the Agreement and Plan of Merger
pursuant to Section 50-73.128 of the Code of Virginia. That statute governed the
merger of partnerships with, among other things, limited liability companies. Va.
Code § 50-73.128 (2002). The Articles of Merger further provided that the LLC 4
adopted the Agreement and Plan of Merger pursuant to Section 13.1-1071 of the
Code of Virginia. That statute applied to mergers involving limited liability
companies. Va. Code § 13.1-1071 (2002); see also id. § 13.1-1070 (2002) (imposing
requirements with respect to mergers involving limited liability companies).
The Agreement and Plan of Merger, which was dated February 4, 2002,
provided that the Partnership was merging “with and into” the LLC. The merger
transferred title to the D.C. property from the Partnership to the LLC. The
Agreement and Plan of Merger did not specify any consideration for the transfer.
The Agreement and Plan of Merger stated that “[t]he LLC shall survive the
Merger and shall continue to be a limited liability company” and that “[t]he separate
existence of the Partnership shall cease.” The Agreement and Plan of Merger
provided that partnership interests would be “converted into” membership interests
in the LLC and that “immediately following the Merger, each former partner of the
Partnership shall have the same percentage ownership of the Surviving Entity as
such partner previously held in the Partnership immediately prior to the Merger.”
The Articles of Merger were filed with the Commonwealth of Virginia State
Corporation Commission on February 7, 2002. On that same date, the Commission
issued a Certificate of Merger recognizing that the Partnership merged into the LLC,
“which continue[d] to exist,” and that “the existence of each non-surviving entity 5
cease[d], according to the plan of the merger.” At the time of the merger, LHL did
not submit a deed or other writing to the ROD indicating that a transfer of real
property had occurred and did not pay any taxes on the 2002 transfer.
In 2019, the LLC decided to sell the property to a third party. LHL therefore
attempted to record a no-consideration deed that reflected the 2002 transfer of the
property from the Partnership to the LLC. The 2019 deed described the Partnership
as having “converted from a general partnership to a limited liability company” in
2002. LHL also submitted other documents to the ROD. After reviewing the
documents, the ROD informed LHL that the 2002 transaction was a merger and that
LHL therefore would need to pay recordation and transfer taxes in order for the ROD
to accept the deed. Because no consideration had been paid for the transfer of the
property, the ROD calculated the amount of taxes owed based on the property’s fair
market value as of 2019, when the deed was recorded. Under protest, LHL paid
recordation and transfer taxes totaling approximately $6,000,000.
LHL filed an administrative claim for refund with the ROD, arguing that the
2002 transfer was not a taxable event. The ROD denied the claim, concluding that
the 2002 transfer was a taxable event because a new and different entity owned the
property after the transfer, the transaction documents characterized the Partnership
as having merged with the LLC, and transfers caused by merger are taxable. 6
The ROD also upheld the calculation of the amount of the taxes owed. The
ROD explained that the 2002 transfer was not for full consideration, and the
regulations applicable to nominal-consideration transfers directed the ROD to look
at the information “available [] at the time of recordation from which the market
value of the property may be determined,” such as the property’s current assessed
value or a certified appraisal not more than 6 months old. 9 D.C.M.R. § 502.10
(recordation tax; emphasis added); see also id. § 602.10 (transfer tax).
LHL sought review in the Superior Court. In February 2020, the District filed
a motion to dismiss, and about a week later LHL filed an amended petition. In March
2021, the Superior Court denied the District’s motion to dismiss, triggering the
District’s obligation to respond within thirty days to LHL’s amended petition. Super.
Ct. Tax R. 7(a)(1). The District did not timely file an answer. LHL initially did not
seek any relief based on the District’s failure to file an answer. Rather, the parties
engaged in discovery and filed joint scheduling orders.
In January 2022, the District moved for leave to file an answer out of time,
explaining that personnel changes had resulted in an inadvertent failure to file an
answer to the amended petition. The court granted the motion, concluding that the
District’s failure to file a timely answer constituted excusable neglect. The court then
granted summary judgment to the District, holding that the 2002 transfer was a 7
taxable event and that the ROD correctly calculated the taxes owed using the
property’s fair market value as of 2019.
II. Analysis
A. Standard of Review
“We review orders granting summary judgment de novo.” PHCDC1, LLC v.
Evans & Joyce Willoughby Tr., 257 A.3d 1039, 1042 (D.C. 2021). “Summary
judgment is only appropriate where there is no genuine issue of material fact and the
moving party is entitled to judgment as a matter of law.” Id. (citation modified). “We
review the record in the light most favorable to the party opposing summary
judgment.” Id. at 1042-43.
We generally decide issues of statutory interpretation de novo. Hershey v.
Hershey, 340 A.3d 1236, 1242 (D.C. 2025). The District argues, however, that the
court should give “deference to the reasonable interpretation of the agency charged
with implementing the statute, which in this case is” the Office of Tax and Revenue.
Bartholomew v. D.C. Off. of Tax & Revenue, 78 A.3d 309, 316 (D.C. 2013);
Vornado, 318 A.3d at 1189 (ROD is “part of the District’s Office of Tax and
Revenue”). LHL argues that the principle of deference that the District invokes was
rejected by the Supreme Court in Loper Bright Enterprises v. Raimondo, 603 U.S. 8
369 (2024). The District responds that Loper Bright is not binding on this court and
notes that, after the decision in Loper Bright, the D.C. Council codified the principle
of deference. D.C. Law 26-37, § 2, 72 D.C. Reg. 8154 (2025) (codified at D.C. Code
§ 2-510(c)). LHL argues that Loper Bright is binding on this court and that the D.C.
Council’s enactment is unconstitutional and violates the Home Rule Act, which
among other things precludes the D.C. Council from passing any law “with respect
to any provision of Title 11 (relating to organization and jurisdiction of the District
of Columbia courts).” D.C. Code § 1-206.02(a)(4). The District responds that the
D.C. Council enactment is constitutional and consistent with the Home Rule Act.
We held this case in abeyance pending the decision in Banks v. Hoffman, 346
A.3d 665 (D.C. 2025) (en banc), which addressed the provision of the Home Rule
Act that LHL relies upon. We also directed several rounds of supplemental briefing
on the issue of deference. We conclude, however, that we need not resolve the
dispute between the parties on that issue. Rather, we assume without deciding that
our review is de novo, and we uphold the ROD’s conclusions. See generally, e.g.,
Lane v. D.C. Dep’t of Hous. & Cmty. Dev., 320 A.3d 1044, 1047 n.1 (D.C. 2024)
(declining to decide implications of Loper Bright because court agreed with
agency’s interpretation “even without giving any deference to it”). 9
B. Taxable Event
LHL argues that the 2002 transfer resulted from a non-taxable conversion
rather than a merger. We hold that the 2002 transfer resulted from a merger.
In a merger, multiple distinct legal entities become one entity. D.C. Code
§ 29-202.01(a). The transfer of real property from one legal entity to another as part
of a merger is a taxable event. Vornado, 318 A.3d at 1193 (“[T]ransfer and
recordation taxes apply upon a transfer of property from one legal entity to
another.”). That is true even where the two entities involved are closely related and
share common ownership. Id. at 1193-94. In Vornado, for example, we held that a
merger between two closely related LLCs that resulted in a transfer of real property
between two distinct legal entities was a taxable event, notwithstanding the
taxpayer’s argument that one of the LLCs was a wholly owned subsidiary of the
other. Id. at 1196. We explained that the issue is one of business form rather than
underlying ownership. Id. at 1193. We emphasized that parties who choose to
structure their business affairs by creating distinct legal entities “must operate
consistently and not seek treatment as individuals when that would better suit their
interests in a particular setting.” Id. at 1194 (citation modified).
We agree with the Superior Court that the 2002 transaction was a merger. It
is undisputed that the 2002 transaction transferred title from one legal entity (the 10
Partnership) to another (the LLC). As described above, supra at 4, all of the
contemporaneous documents indicate that both the LLC and the Partnership existed
before the transaction and then merged, with the LLC being the entity that survived
the merger. Moreover, the Plan of Merger cites Virginia Code provisions (Va. Code.
Ann. §§ 13.1-1071 (2002), 50-73.128 (2002)) that governed mergers. Because the
2002 transaction merged two distinct legal entities and transferred property from one
to the other, the transfer of property was a taxable event.
We are not persuaded by LHL’s arguments to the contrary. First, LHL argues
that the 2002 transaction was a non-taxable conversion. We disagree. A conversion
is a single-entity event that occurs when an entity “convert[s] to a different type of
entity.” D.C. Code § 29-204.02(a). To effect a conversion, a statement of conversion
must be signed by the converting entity and delivered to the Mayor. D.C. Code
§ 29-204.05(a). As we have explained, in the present case two legal entities merged
into one. As the ROD noted, “in order for a transaction to qualify as a conversion, it
must be shown that the owner of the property is the same entity both before and after
the transfer.” See Vornado, 318 A.3d at 1196 (holding that transfer between two
distinct legal entities was not pursuant to conversion). LHL did not make that
showing. 11
LHL attempts to rely on the fact that the word “converted” appears once in
the Agreement and Plan of Merger, which provides that partnership interests will be
“converted into” membership interests in the LLC. We are not persuaded by that
argument. The Agreement and Plan of Merger refers to conversion of the interests
of individuals, not to conversion of the Partnership into an LLC. As we have noted,
see supra at 3-4, all of the references to the two legal entities in the Articles of
Merger and the Agreement and Plan of Merger indicate that the two legal entities
merged, not that one converted into the other.
LHL also argues that in fact the LLC did not pre-exist the 2002 transaction
and instead came into being contemporaneously with that transaction, as was
required by Virginia law. Our difficulty with this argument is that we see no evidence
in the record to support the argument and substantial evidence pointing in the other
direction. The LLC was signing documents before the Articles of Merger and the
Agreement and Plan of Merger were submitted to the Commonwealth of Virginia
State Corporation Commission. Those documents described a transaction in which
the Partnership and the LLC merged, not a transaction in which the Partnership
turned into an LLC that did not previously exist, and the Certificate of Merger
described the Partnership as merging into the LLC, “which continue[d] to exist.” As
we have noted, “the burden shall be upon the taxpayer to show that a deed is exempt 12
from tax.” D.C. Code § 42-1107 (recordation tax); see id. § 47-907 (transfer tax).
LHL did not present evidence sufficient to carry that burden.
Second, LHL argues that the 2002 transaction is not taxable because the
transaction was a conversion under Virginia law. We are skeptical that Virginia law
would govern if it differed from the law of the District. We need not resolve that
issue, however, because as we have noted, supra at 3-5, everything in the record
indicates that the 2002 transaction was a merger under Virginia law as well as under
District law.
Third, LHL argues that the 2002 transaction should be viewed as a conversion
rather than a merger because of the way the transaction would be treated as a matter
of federal tax law. As we have noted elsewhere, however, District tax law sometimes
“differs in dispositive respects from federal tax law.” Sch. St. Assocs. v. District of
Columbia, 764 A.2d 798, 800 (D.C. 2001) (en banc). The issue before us is how the
2002 transaction should be treated under District law governing recordation and
transfer taxes, not how the transaction might be viewed under various provisions of
federal tax law.
Finally, LHL argues that the 2002 transaction is not taxable because the
partners in the Partnership are identical to the members of the LLC. As previously
noted, supra at 10-11, the fact that the owners of the two different legal entities are 13
the same is irrelevant. For purposes of the recordation and transfer taxes, the relevant
inquiry is “legal ownership,” not the identities of the individual owners. Cowan v.
D.C. Dep’t of Fin. & Revenue, 454 A.2d 814, 815 (D.C. 1983) (per curiam). The
provisions at issue focus upon corporate form, and a transfer of real property from
one legal entity to another is taxable. That “the participants in both business
enterprises were similar [does] not recast [a transaction] into something other than a
property transfer between two separate business entities.” Columbia Realty Venture
v. District of Columbia, 433 A.2d 1075, 1080 (D.C. 1981).
C. Amount of Tax
If a transfer does not reflect payment of consideration, as in the present case,
the recordation and transfer taxes “shall be based upon the fair market value” of the
transferred real property. D.C. Code § 42-1104(a) (recordation tax); see id. § 47-904
(transfer tax). In this case, the ROD determined the amount of the taxes based on the
fair market value of the property as of 2019, when the deed was recorded. LHL
argues that the amount of the taxes should instead have been calculated using the
fair market value as of the time of the transfer of the property in 2002. Although we
view the issue as a close one, we conclude that the better view is that the amount of
the taxes was properly based on the fair market value of the property as of 2019. 14
The applicable statutes do not provide an explicit time frame for the
determination of fair market value. D.C. Code §§ 42-1104(a) (recordation tax),
47-904 (transfer tax). Several considerations, however, point in favor of using the
fair market value as of the time of recordation.
First, we conclude that although recordation is required within thirty days of
transfer, D.C. Code § 47-1431(a), the duty to pay the recordation and transfer taxes
arises at the time of recordation, not at the time of transfer or at the time within which
recordation was required. See D.C. Code §§ 42-1103(a)(1) (recordation tax: “At the
time a deed . . . is submitted for recordation, it shall be taxed . . . .”), 47-903(a)(1)
(transfer tax: “There is imposed on the transferor for each transfer at the time the
deed is submitted to the Mayor for recordation a tax . . . .”); In re Salas, No.
18-00260, 2020 WL 3966952, at *2-4 (Bankr. D.D.C. July 13, 2020) (duty to pay
recordation and transfer taxes arises upon recordation).
We note one apparent consequence of the conclusion that the duty to pay the
recordation and transfer taxes does not arise until recordation, even if recordation
was unlawfully delayed. It seemingly follows, as one bankruptcy judge has held, that
the District is not entitled to interest on the taxes for the period of unlawful delay in
registration. See In re Salas, 2020 WL 3966952, at *3 (denying interest on
recordation and transfer taxes where deed had not yet been recorded; “those taxes 15
have not yet come due and interest will start to accrue only once the taxes come due
upon recordation of the deed”). Nevertheless, we conclude that the plain language
of the pertinent provisions establishes that the recordation and transfer taxes are not
due to be paid until the time of recordation, even if recordation is unlawfully delayed.
That the duty to pay the taxes at issue arises at the time of recordation, rather
than the time of transfer, does not definitively establish that the amount of the taxes
should be based on the fair market value of the property at the time of recordation,
rather than the fair market value as of the time of transfer. In our view, however, it
is natural to infer, in the absence of an express provision otherwise, that the amount
of a tax that arises on the occurrence of a given event (in this case, recordation)
would be determined based on the circumstances that exist at the time of that event,
rather than at the time of some earlier or later event. Cf. generally Russo v. Borough
of Carlstadt, 17 N.J. Tax 519, 523 (Super. Ct. 1998) (“[V]aluation of real property
for tax purposes begins with the well-settled premise that value is based upon the
actual condition of the property as of the date of assessment.”).
Second, determining historical fair market value can be quite a bit more
challenging than determining current fair market value. See, e.g., In re Levy, 256
B.R. 563, 566 (Bankr. D.N.J. 2000) (noting “additional expense and difficulty” if
creditor were required to determine value of real property as of four years earlier). 16
We would not lightly infer that the legislature was imposing on the parties and the
courts the task of trying to determine the historical fair market value of property that
was transferred for no consideration. Cf. State ex rel. Levine v. Bd. of Rev. of Fox
Point, 528 N.W.2d 424, 430 (Wis. 1995) (“Assessing the full value of real property
that has not been sold in recent years is difficult at best, but calculating the past value
of such property is a task too costly and burdensome to impose . . . .”).
Third, tying the amount of the recordation and transfer taxes to the fair market
value of the property at the time of recordation provides an incentive to timely record
deeds. Under that approach, a party who fails to timely record a no-consideration
deed runs the risk that the value of the transferred property will appreciate over time,
thereby increasing the amount of tax eventually due. Cf., e.g., Ridgewood Dev. Co.
v. Minnesota, 294 N.W.2d 288, 292 (Minn. 1980) (“There is a tendency for the value
of land to increase . . . .”).
We note that the applicable regulations also support the conclusion that the
amount of the recordation and transfer taxes should be based on the fair market value
of the property at the time of recordation. Deeds that involve nominal consideration
are also taxed on the basis of fair market value. D.C. Code §§ 42-1104(a)
(recordation tax), 47-904 (transfer tax). In determining whether the consideration for
a transfer is nominal, the ROD is permitted to consider, among other things, the 17
current assessed value of the property and a certified appraisal report that is not more
than six months old. 9 D.C.M.R. §§ 502.10(a)-(b) (recordation tax), 602.10(a)-(b)
(transfer tax). The regulations thus appear to reflect the view that fair market value
is to be determined as of the time of recordation. We do not rely on the regulations,
however, because as previously noted we are deciding this case on the assumption
that the Office of Tax and Revenue is not entitled to any deference with respect to
the interpretation of the statutes at issue. See supra at 7-8.
We acknowledge a significant factor that points in the direction of a
conclusion that fair market value should be determined as of the time of the transfer:
transfers that involve non-nominal consideration are taxed based on the amount of
the consideration paid or required to be paid for the transfer, not based on the fair
market value of the property at the time of recordation. D.C. Code
§§ 42-1103(a)(1)(A) (recordation tax of 1.1 percent of consideration), 47-903(a)(1)
(transfer tax of 1.1 percent of consideration). This feature of the provisions at issue
has two consequences, in our view. First, it weakens the strength of the general
inference that the amount of the recordation and transfer taxes would most naturally
reflect the circumstances of the property at the time the duty to pay the taxes arises.
Second, it means that disparities arise if no-consideration and nominal-consideration
transfers are taxed in an amount that is based on the fair market value of the property
at the time of recordation. If a property was transferred in 2020 for non-nominal 18
consideration of $1,000,000, then the combined recordation and transfer taxes would
be $22,000, even if the deed was not recorded until 2027. D.C. Code
§§ 42-1103(a)(1)(A) (recordation tax of 1.1 percent of consideration), 47-903(a)(1)
(transfer tax of 1.1 percent of consideration). If the same property was transferred in
2020 for no consideration, or for nominal consideration, the combined recordation
and transfer taxes could vary substantially depending upon the time and
circumstances of the subsequent recordation. If the deed was recorded in 2027 and
property values had increased by twenty percent between 2020 and 2027, for
example, the combined taxes would be over $26,000. Conversely, if property values
had (unusually) decreased by twenty percent over that time, the combined taxes
would be less than $18,000. It is not obvious why the legislature would have wanted
the amount of taxes owed to vary in these ways.
Although we are given pause by these considerations, on balance we
nevertheless conclude that the better view is that the amount of the recordation and
transfer taxes for transfers involving no or nominal consideration should be based
on the market value of the property at the time of recordation. That approach has the
strengths we have previously noted, see supra at 14-17, including that the parties
and the courts will not be forced to try to determine the fair market value of property
at a time that could be far removed from a transaction (in this case almost twenty
years). Moreover, parties who wish to avoid the uncertainties and discrepancies that 19
might otherwise arise can do so by simply complying with their duty to timely record
deeds transferring real property.
In sum, we hold that the amount of the recordation and transfer taxes for
transactions that involve no or nominal consideration should be based on the market
value of the property at the time of recordation.
D. Untimely Filing of Answer
Finally, LHL challenges the trial court’s ruling that the District’s failure to
timely file an answer to LHL’s amended petition constituted excusable neglect. We
hold that the trial court acted within its discretion.
A trial court “may, for good cause, extend the time [by which an act must be
done] on motion made after the time has expired if the party failed to act because of
excusable neglect.” Super. Ct. Civ. R. 6(b)(1)(B); see also Super. Ct. Tax R. 3(a)
(making Super. Ct. Civ. R. 6 applicable in Tax Division). “We review trial-court
findings as to whether there was excusable neglect for abuse of discretion.” Gilliam
v. D.C. Dep’t of Forensic Scis., 343 A.3d 900, 903 (D.C. 2025).
Courts evaluating whether excusable neglect has occurred “should consider
the danger of prejudice to other parties, the length of the delay and its potential
impact on judicial proceedings, the reason for the delay, including whether it was 20
within the reasonable control of the movant, and whether the movant acted in good
faith.” Gilliam, 343 A.3d at 905 (citation modified) (applying test for excusable
neglect from Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd. P’ship, 507 U.S. 380
(1993)).
The trial court considered the applicable factors and concluded that (1) LHL
had not asserted prejudice; (2) although the amount of the delay (nine months) was
significant, the delay did not affect the proceedings because the parties moved
forward with the case and the answer did not raise new issues; (3) the delay was
within the District’s reasonable control; and (4) in general, the District had been
“responsible, engaged, and diligent, and there is no evidence that the District acted
in bad faith.” The trial court also noted that LHL did not initially seek any relief
when the District failed to file a timely answer but rather participated without
objection as the case moved forward and only raised the issue in opposition to the
District’s motion for leave to late file an answer.
We conclude that the trial court considered all of the applicable factors and
reasonably concluded that on balance those factors favored a finding of excusable
neglect.
We are not persuaded by LHL’s arguments to the contrary. First, LHL argues
that when a party misses an unambiguous deadline, excusable neglect cannot exist. 21
In support of that argument, LHL cites Pioneer, 507 U.S. 380. We see nothing in
Pioneer supporting the existence of such a flat rule. We also see no reason why a
flat rule of that type would be warranted. To the contrary, we have stated that “even
a clear deadline may be enlarged for excusable neglect.” In re Est. of Yates, 988 A.2d
466, 470 (D.C. 2010); cf. Lynch v. Meridian Hill Studio Apts., Inc., 491 A.2d 515,
518 (D.C. 1985) (“[F]ailure to understand or observe court rules is [not] per se
inexcusable neglect.”) (citation modified).
Second, LHL argues that it was prejudiced because it has been ordered to pay
the taxes at issue. The mere fact that judgment ultimately was entered against LHL,
however, does not establish that LHL was prejudiced by the District’s delay in filing
an answer. In considering whether a party has been prejudiced by delay, we focus
on whether the delay placed additional burdens on the opposing party, beyond the
ordinary costs of litigation, or otherwise unduly impeded the opposing party’s ability
to respond on the merits. Newton v. Grajny, No. 24-CV-0654, 2026 WL 1338719,
at *3 (D.C. May 14, 2026). We see no indication that LHL was prejudiced in any
way by the District’s late filing of an answer.
Finally, LHL argues that the District’s failure to timely file an answer was
within the District’s own control, and that fact by itself precludes a finding of
excusable neglect. We disagree. Control is only one of the four factors, and the trial 22
court reasonably found that on balance the factors weighed in the District’s favor.
Although LHL cites In re Grooms, 123 A.3d 976 (D.C. 2015), in support of the
contention that control is the weightiest factor, we see nothing in Grooms supporting
that contention. Rather, Grooms treated control as one of the four pertinent factors
and found that all four cut against a finding of excusable neglect. Id. at 978-80.
In sum, the trial court acted within its discretion in finding that the District
demonstrated excusable neglect.
For the foregoing reasons, we affirm the judgment of the Superior Court.
So ordered.