David B. SHARPS,





(TC 4684)

Due to decisions of the Board of Property Tax Appeals and the Magistrate Division over several tax years, the assessed value of certain property owned by Plaintiff (taxpayer) was either decreased or held equal to the roll value. Linn County (the county) sent taxpayer refund checks for two of the years that had been disputed and finally determined. Taxpayer refused delivery of one check and received the other but refused to cash it, arguing that he is entitled to refuse payment because some other cases had not ended in a final determination and negotiation of the checks would expose him to the possibility of later deficiency assessments bearing interest at a higher rate than that to which he was entitled in the checks. The court held that interest accrual on the refunds terminates at the point the taxpayer has access to the funds and that taxpayer's fear of exposure to higher interest rates was unfounded because the two relevant cases had been finally determined and because it is irrelevant to that payment whether other tax years remain in dispute.

Property Taxation--Refund--Interest Accrual

1. Under ORS 311.806 and ORS 311.812, interest ceases to accrue on a property tax refund on the date payment is tendered to the taxpayer because at that point the taxpayer has access to the funds and the county must adjust its records.

Property Taxation--Refund--Interest Accrual

2. Under ORS 311.806 and ORS 311.812, an overpayment of property tax must be refunded with interest following a final determination regarding a tax year, and a taxpayer is not entitled to refuse payment of a refund out of fear that an underpayment for a different tax year will earn a higher interest rate than taxpayer receives on the overpayment.

Submitted on Plaintiff's Motion for Partial Summary Judgment.

David B. Sharps Plaintiff filed the motion \i\pro se\r\.

Joseph A. Laronge, Assistant Attorney General, Department of Justice, Salem filed a response for Defendant.

Decision rendered March 9, 2006.



This matter comes before the court on a motion for partial summary judgment filed by Plaintiff (taxpayer). This was the second of a series of motions which the parties and the court agreed would be used to decide subsets of issues comprising Plaintiff's claim. That claim relates to proper calculation of interest on amounts which the parties agree were overpayments of property tax by taxpayer. The first of those motions has been decided, in favor of Defendant (the department) on the question of the rate of interest to be applied in the calculations of amounts due to taxpayer.

This motion raises the question of how partial refund payments should be treated where checks were drawn in favor of and delivered to taxpayer, even though taxpayer did not cash or else refused to accept those checks.


These facts are from a stipulation filed by the parties. For several years Linn County (the county) assessed taxpayer's property and taxpayer appealed that action to the county Board of Property Tax Appeals (BOPTA) and the Magistrate Division of this court. From the stipulation, it appears that some confusion and timing problems occurred in adjusting values as cases matured and decisions were rendered, sometimes in mid-cycle for the next year. However, the adjustments in assessed value for the property in question, measured, as must be done, on a year-by-year basis, never resulted in an increased value for the property. Rather assessed values were reduced, if changed at all. (1) In any case, on two occasions, the county adjusted roll values downward from what they had been and prepared a check to refund tax to taxpayer. In one case taxpayer received the check but has refused to cash it. In another case taxpayer refused delivery of the check.


For purposes of computing amounts of interest due to taxpayer on refunds of tax that accrue interest under ORS 311.812, (2) how are payments made by check by a county to be treated where a taxpayer refuses or does not cash such checks?


1. ORS 311.806 provides for refunds of property tax in certain situations. ORS 311.812 provides a limited set of cases in which interest on such refunds is to be paid. ORS 311.812 specifies when interest computation is to start but does not explicitly specify when it is to terminate. Logically, termination would be the date of payment of the refund. The court concludes such payment terminates the accrual of interest. At that point the taxpayer has access to the funds and the county must adjust its records. \i\See\r\ ORS 311.806.

2. Taxpayer argues that he is entitled to refuse payment because payment cannot legally be made before a case is completed. He also argues that early negotiation of a check would expose him to the possibility of later deficiency assessments bearing interest at a higher rate than that to which he is entitled on underpayment. Neither argument is well taken. No statute prevents a refund of the type involved here, for a particular year in question, after a decision in the Magistrate Division of this court for such year where no appeal was taken. At that point, the case for the year in question has been completed. The fact that there may be other years in litigation is of no moment. ORS 311.806 contemplates that unappealed decisions of this court, if in favor of the taxpayer, trigger a duty for the county to pay a refund.

Nor does any statute justify taxpayer in refusing a payment because of fear of later adjustment that could result in exposure to interest on some underpayment. First, there having been an adjudication in each instance presented here, it does not appear there could be a later adjustment for any given year. Second, even if there could be, as to any particular year, a later determined liability, ORS 311.513 provides that interest is payable only from and after a final resolution of the controversy for that year. Taxpayer's fear of interest exposure is unfounded.


After reviewing the motion and response, and being fully apprised of the premises, for the above-stated reasons, the court finds that the accrual of interest terminates upon payment and the rates of interest are determined by the legislature. Now, therefore,

IT IS ORDERED that Plaintiff's Motion for Partial Summary Judgment is denied.

1. The stipulation indicates one small increase for the 2000-01 tax year, but there is no indication that this led to any increased payment of tax for that year.

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2. All references to the Oregon Revised Statutes (ORS) are to the 2003 edition.

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