Ellison v. Dept. of Rev.

If the Tax Court finds “in favor of the taxpayer” in proceedings for ad volorem property taxation, exemptions, special assessments or omitted property, the Tax Court is permitted to award reasonable attorneys fees in addition to costs and disbursements. ORS 305.490(4)(a).

The Department of Revenue (“the Department”) appealed an order of the Tax Court that awarded attorney fees to the Clackamas County Assessor after the Tax Court rejected the Department’s request to increase the real market value of taxpayer property. On appeal, the Department argued that the Tax Court did not have authority to award attorney fees because the court is required to determine an actual value of the property in order to make a ruling “in favor of the taxpayer.” If the Tax Court finds “in favor of the taxpayer” in proceedings for ad volorem property taxation, exemptions, special assessments or omitted property, the Tax Court is permitted to award reasonable attorneys fees in addition to costs and disbursements. ORS 305.490(4)(a). The Oregon Supreme Court found that ORS 305.490 does not restrict attorney fees to proceedings only where the taxpayer obtains relief when it is requested, but also in proceedings where the taxpayer “persuades the court to reject the Department’s request for an increase.” The Court held that the Tax Court did not abuse discretion by awarding attorney fees. However, the Court ultimately vacated the order that awarded fees because it found the Tax Court considered an erroneous factor in its determination for the award’s amount. The supplemental money judgment of the Tax Court is vacated. The matter is remanded to the Tax Court for further proceedings.