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FC Biltmore, LLC v. Quinn

Superior Court of Rhode Island

May 21, 2014

FC BILTMORE, LLC, Plaintiff,
v.
DAVID QUINN, in his capacity as Tax Assessor for the City of Providence; JOHN A. MURPHY, in his capacity as Tax Collector for the City of Providence; MICHAEL D'AMICO, in his capacity as Director of Administration for the City of Providence and Chief of Staff for the Mayor of the City of Providence; and THE CITY OF PROVIDENCE, Defendants.

Providence County Superior Court

For Plaintiff: Jeffrey H. Gladstone, Esq.

For Defendant: Anthony DeSisto, Esq.; Jeffrey M. Padwa, Esq.

DECISION

SILVERSTEIN, J.

FC Biltmore, LLC (Plaintiff) brings this action seeking redress from a revised tax bill issued to it by David Quinn, in his capacity as Tax Assessor for the City of Providence (Quinn), John A. Murphy, in his capacity as Tax Collector for the City of Providence (Murphy), Michael D'Amico, in his capacity as Director of Administration for the City of Providence and Chief of Staff for the Mayor of the City of Providence (D'Amico), and the City of Providence (the City), collectively referred to as Defendants. Plaintiff seeks a determination regarding the obligations owed by it to Defendants with respect to a Tax Stabilization Agreement (TSA) that was executed by the parties. Currently before the Court are cross-motions for summary judgment. Jurisdiction is pursuant to G.L. 1956 §§ 9-30-1, 44-5-26, and 44-5-27.

I Facts and Travel

Plaintiff is the current owner of the Biltmore Hotel (the Hotel), [1] located at 11 Dorrance Street in Providence, Rhode Island. Plaintiff acquired the property by deed on May 31, 2012, from a court appointed special master, Richard L. Gemma, [2] hereinafter "Special Master."[3]

The Special Master sought to sell the Hotel to an interested buyer. To make the Hotel more attractive to a prospective buyer, the Special Master submitted an application for tax stabilization with the City. On March 15, 2012, the Special Master entered into a TSA with the City regarding the Hotel. The TSA was conditioned upon City Council approval per ¶ 16[4] of the TSA. ("This Agreement shall only take effect upon City Council approval.") The City Council later passed Resolution of City Council No. 145 (the Resolution), which approved the application for tax stabilization. On March 22, 2012, the Resolution was approved by the Mayor of Providence. As a result of the TSA and the Resolution, the Special Master was able to sell the Hotel, along with the Special Master's rights under the TSA, to Plaintiff.

Pursuant to the TSA, Plaintiff's tax bill for the Hotel was not to be more than the taxes assessed on or at December 31, 2010, or $124, 506.20 (the Stabilized Tax Payment). Plaintiff was issued tax bills by the City for 2012 and for 2013 in the amount of the Stabilized Tax Payment. Plaintiff paid both these tax bills to the City on time and in full. However, in November 2013, the City issued a revised tax bill for the tax years of 2012 and 2013. With this revised tax bill, the City took the position that the Tax Stabilization Period[5] did not go into effect until renovation of the Hotel was substantially completed, and assessed back taxes in the total amount of $1, 345, 695.33. Defendants, pointing to language set forth in the TSA defining the Commencement Date, claim that the Tax Stabilization Period is conditioned upon substantial completion of renovation of the Hotel, which has yet to occur.[6] Plaintiff disagrees, contending that the Tax Stabilization Period began upon execution of the agreement in accordance with City Ordinance 2011-1 (the Ordinance). Due to Plaintiff's refusing to pay the assessed back taxes, the Hotel was scheduled for a tax sale on May 15, 2014 at Providence City Hall (the Tax Sale).

Plaintiff brings the within action for a determination regarding the TSA and whether the taxes assessed are proper. The Verified Complaint (Complaint) asserts eight counts—Injunctive Relief (Count I), Declaratory Judgment (Count II), Equal Access to Justice (Count III), Constitutional Violations (Count IV), 42 U.S.C. § 1983 (Count V), Civil Conspiracy (Count VI), Slander of Title (Count VII), and Breach of Contract (Count VIII)—against the Defendants. This Court, on April 10, 2014, entered a Temporary Restraining Order that restrained the City from listing, conducting, or taking any further action with regards to the Hotel and the Tax Sale until further order of the Court. Currently before the Court are cross-motions for summary judgment as to Counts I, II, and VIII, and more specifically, a determination as to (1) the proper interpretation of the TSA, as it concerns the date upon which the Tax Stabilization Period becomes effective; and, (2) whether the City had authority to impose the claimed back tax after having already assessed and collected the Stabilized Tax Payment for two years.

II Standard of Review

"Summary judgment is a proceeding in which the proponent must demonstrate by affidavits, depositions, pleadings and other documentary matter . . . that he or she is entitled to judgment as a matter of law and that there are no genuine issues of material fact." Palmisciano v. Burrillville Racing Ass'n, 603 A.2d 317, 320 (R.I. 1992) (citing Steinberg v. State, 427 A.2d 338 (R.I. 1981)). The court, during a summary judgment proceeding, "does not pass upon the weight or the credibility of the evidence but must consider the affidavits and other pleadings in a light most favorable to the party opposing the motion." Id. (citing Lennon v. MacGregor, 423 A.2d 820 (R.I. 1980)). Moreover, "the justice's only function is to determine whether there are any issues involving material facts." Steinberg, 427 A.2d at 340. The court's purpose during the summary judgment procedure is issue finding, not issue determination. O'Connor v. McKanna, 116 R.I. 627, 359 A.2d 350 (1976). Therefore, the only task for the judge in ruling on a summary judgment motion is to determine whether there is a genuine issue concerning any material fact. Id.

"When an examination of the pleadings, affidavits, admissions, answers to interrogatories and other similar matters, viewed in the light most favorable to the party opposing the motion, reveals no such issue, the suit is ripe for summary judgment." Id. "[T]he opposing parties will not be allowed to rely upon mere allegations or denials in their pleadings. Rather, by affidavits or otherwise they have an affirmative duty to set forth specific facts showing that there is a genuine issue of material fact." Bourg v. Bristol Boat Co., 705 A.2d 969, 971 (R.I. 1998). However, it is not an absolute requirement that the nonmoving party file an affidavit in opposition to the motion. Steinberg, 427 A.2d at 338. If the affidavit of the moving party ...


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