"The Tenant’s Assessment Appeal," Published in REFA-CT 2019 Winter Newsletter
Under Connecticut law, a tenant party to a signed lease recorded on the land records (a memorandum will be sufficient) who is obliged under that lease to pay real estate taxes may bring a tax assessment appeal. Indeed, tenants frequently become tax appeal plaintiffs under NNN lease situations where the property owner/landlord is not economically motivated to challenge an assessment.
The standing of the tenant to take a tax appeal in New York is not as well established. The Empire State’s rule permits an “aggrieved party” to challenge the decision of a local board of assessment review - but without further detail. Thus, the question in an April, 2019 New York Court of Appeals (that state’s highest court) decision was whether a tenant who is not legally bound to pay real estate taxes and who nevertheless pays them may challenge the assessment. New York’s highest court ruled that lacking a legal obligation to do so, the tenant could not pursue the appeal. Actual payment of the taxes as a matter of business judgment was not sufficient.
Returning to Connecticut, members of our firm’s Property Tax and Valuation Department frequently find that tenants who are legally bound to pay real estate taxes for some reason have failed to record the appropriate document on the land records thereby potentially invalidating an appeal which otherwise could go forward. One way we deal with this challenge is to quickly prepare a brief memorandum of the lease which, with both the landlord’s and tenant’s signatures, can be recorded in order to prime the tax appeal.