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Sunday, July 28, 2019


Alcatel-Lucent USA Inc. (Alcatel), is the owner of real property in the Township of Berkeley Heights on which is located its North American headquarters.1 There are approximately 1.5 million square feet of improvements on the 153.4 acre Berkeley Heights property – of which Alcatel contends 53 acres are woodlands.
N.J.S.A. 54:4-34 – commonly referred to as Chapter 91 (you have to read the decision to find out why) – requires every real property owner to provide "a full and true account of his [or her] name and real property and the income therefrom, in the case of income-producing property" to the municipal tax assessor upon the assessor's written request. The statute also precludes the owner from appealing the assessor's valuation and assessment if the owner fails or refuses to respond to the Chapter 91 request.
After Alcatel failed to respond to the tax assessor's request for information pertaining to its Berkeley Heights property, LTI filed a farmland assessment application for the woodland portion of the property. The assessor denied the application concluding agriculture was not the dominant use of the property; Alcatel filed a complaint with the Tax Court challenging the denial. The Tax Court dismissed the complaint holding it was precluded under Chapter 91 because Alcatel failed to respond to the assessor's Chapter 91 request.
The court rejected Alcatel's arguments that the Tax Court erred in: extending the application of the Chapter 91 preclusion penalty to its farmland assessment appeal; applying the Chapter 91 preclusion penalty to the woodland property because it is not income producing; and formulating a new rule that misinterprets our prior holding and undermines the legislative purpose of Chapter 91 and the Act. It also argued that technical deficiencies in the Township's Chapter 91 request bar preclusion of its claim.
The property was conveyed by Lucent Technologies, Inc. (Lucent) to LTI NJ Finance LLC (LTI), which simultaneously entered into a twenty-year agreement with Lucent, the sole member of LTI, pursuant to which Lucent was considered the "beneficial owner." Lucent merged with Alcatel, a French company, in 2006, to form Alcatel-Lucent USA Inc. The agreement between LTI and Lucent was terminated in 2013 and LTI was merged into Alcatel. The court was informed by Alcatel's merits brief that it is now known as "Nokia".
The court perceived no reason why Chapter 91's preclusion should not apply to Alcatel's farmland assessment complaint and affirmed Judge Joshua D.Novin's dismissal. The court recognized that the comprehensive statutory scheme requires tax assessors to assess every property at its full and fair value each year. Inasmuch as the Chapter 91 data is essential to the valuation of a split-use property, and, in turn, to the fulfillment of the assessor's statutory duties for the entire municipality, the court agreed with Judge Novin that the statute's preclusion provision should be applied to owners who fail to respond to the assessor's request.