JC Trapper, LLC v. City of Jersey City

19 N.J. Tax (Tax 2001)

Opinion Date: February 22, 2001
Real Property Law
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TAXATION; REFUNDS—Where a property owner knows that it doesn’t own a parcel of land, but pays taxes for that parcel anyway, it is not entitled to a refund because there is no “mistake in fact.”

A property owner and its predecessor in title paid taxes on certain street lots since 1988. However, title to those lots had reverted to the municipality in 1987. In 1999, the then property owner sought a refund of the real estate taxes paid on those lots for 1988 through 1999. The claim for refund was based on N.J.S. 54:4-54, which permits a person who pays the tax on someone else’s property believing it to be his own to seek the return of the money. Whereas the statute uses permissive language, “the governing body…may return the money,” the Tax Court held that where there was a mistake in fact, there was no discretion and a taxing authority is required to reimburse the taxpayer who mistakenly paid the taxes. However, since each property owner had knowledge of the facts relating to the ownership of the lots and had failed to contest the assessment they could not claim they made a “mistake in fact.” Therefore, they were not entitled to reimbursement of the property taxes paid.

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