CITY OF BOSTON vs. JOHN W. SEARS.

The City of Boston brings this petition pursuant to the provisions of G.L. c. 60, §65 to foreclose the right of redemption of John W. Sears, the owner of the premises at 7 Acorn Street in the Beacon Hill District of said City for failure to pay the taxes assessed to him for fiscal year 1975. The taxpayer contends that the City made an error in the amount of the assessment and that his failure to pay the incorrect bill was justified. He has offered, however, to pay the real estate taxes in question if this Court relieves him from the burden of paying the interest and charges thereon. This is an equitable solution to the resolution of a clear mistake on the City's part and the extraordinary case where relief may be granted. Leto v. Assessors of Wilmington, 348 Mass. 144 (1964).

On all the evidence I find and rule as follows:

1. The taxpayer and the City entered into a settlement agreement reducing the assessment on the premises at 7 Acorn Street for calendar years 1972, 1973 and 1974 from $23,000 to $20,000.

2. The settlement agreement has not been located so it is unclear whether it dealt specifically with the taxes for fiscal year 1975. However, because of the peculiarities in the tax assessment procedure at this time, the assessment for fiscal 1975 by law was made as of January 1, 1974, and no one disputes the agreement to lower the 1974 assessment to $20,000.

3. By Statute 1973, Chapter 52, §8 a procedure was adopted to implement the change in the fiscal year of the Commonwealth's cities and towns by clarifying the change of the method of payment of real estate taxes. Said §8 provided for two assessments and two bills for real property taxes for the 18 month fiscal year beginning on January 1, 1973. The first bill was to be for taxes assessed as of January 1, 1973, and the tax rate was to be based on two-thirds of the amount required to be assessed for the 18 month fiscal year beginning January 1, 1973. The bill was payable no later than November 1, 1973 if interest were to be avoided. The second bill was to be for taxes assessed as of January 1974, and the tax rate was to be based on one-third of the amount required to be assessed for said 18 month fiscal year. The bill was to be paid by May 1, 1974 to avoid the payment of interest. See City of Lawrence v. Louise Troisi, et al, Land Court Case No. 58855.

4. Taxes for the 1975 fiscal year commencing July 1, 1974 and ending on June 30, 1975, the period which is now before the Court, also were assessed as of January 1, 1974 with two payments to be made, one by November 1, 1975 and the second by May 1, 1976. With fiscal 1975 began the present system which calls for the semi­annual payment of real and personal property taxes.

5. The assessment for fiscal 1975 therefore was determined by the settlement for calendar 1974 since calendar 1974 and fiscal 1975 taxes both were assessed as of January 1, 1974.

6. Accordingly the tax bill in fact issued for fiscal 1975 was incorrect since it was based on the pre-abatement 1974 assessment. The taxpayer did not pay that portion of the tax bill for fiscal 1975 attributable to the $3,000 overvaluation; but neither did he seasonably file an application for abatement or an appeal to the appellate tax board.

7. The taxpayer has continuously refused to pay the disputed amount, and the amount of interest and charges have mounted dramatically.

8. The City applied to the Department of Revenue on at least two occasions for authority to abate the tax pursuant to G.L. c. 58, §8, and authority unjustifiably was refused.

Chapter 59 of the General Laws sets forth the statutory scheme which taxpayers must follow to secure relief from an overvaluation, and there are many cases where failure to follow the statutory pattern forestalled the granting of relief. However, there are cases like Norwood v. Norwood Civic Association, 340 Mass. 518 (1960) where the Supreme Judicial Court has recognized the defence of a void tax in tax foreclosure proceedings.

The parties have argued in Court and the commissioner of the department of revenue seemed to find important the question as to whether the settlement covered fiscal 1975 taxes, but this seems to me immaterial. As a matter of law the assessment was the same for both calendar 1974 taxes and fiscal 1975 taxes with the assessment made as of January 1, 1974. Once the City entered into an agreement as to the amount of the January 1, 1974 assessment, then that was the assessment for both periods of time. Because of the way the assessing procedures are implemented, the computer or those feeding material to it did not pick up the change when the fiscal 1975 tax bills were prepared. They contained a mistake as a matter of law in the amount of the assessment. The prudent thing for the taxpayer to have done, and the step which his attorney advised him to take, was then to have filed a seasonable application for abatement, whereas the abatement he filed was beyond the statutory period. He has acted in a penny-wise, pound­foolish manner. Consequently the taxes in question applicable to the $3,000 difference in the assessment over which the parties have argued have remained unpaid until the present time so that from a $500 error the amount owed by the taxpayer has risen precipitously to $2,162.26 as of March 3, 1991. The City also is holding sums due to the taxpayer for taxes abated but not yet paid because of this controversy. I find and rule that in view of the taxpayer's willingness to pay the amount originally in dispute, i.e., $590.10, I will relieve him from paying the interest and charges due from 1975 to the present. Upon payment of the taxes I will dismiss the City's petition. The City thereafter is to pay the proceeds of the abatements which have been withheld.

Judgment accordingly.