Justia Maine Supreme Court Opinion Summaries

Humboldt Field Research Institute and Eagle Hill foundation applied for a property tax exemption pursuant to Me. Rev. Stat. 36, 652(1)(A) and (B), which the Town assessors denied. The county commissioners upheld the Town's denial, and the superior court affirmed. Humboldt and Eagle Hill appealed, arguing (1) the Town was required to continue Humboldt's and Eagle Hill's tax exemptions from the prior year, which were based on their status as charitable institutions, absent evidence of an organizational change; and (2) the organizations were exempt as literary and scientific institutions. The Supreme Court affirmed, holding (1) Maine law consistently places the burden on the taxpayer to prove entitlement to a tax exemption, even when an exemption has been granted in prior years, if the assessor challenges the exemption; and (2) the commissioners did not err in determining that Humboldt and Eagle Hill did not meet their burden to prove entitlement to an exemption. View "Humboldt Field Research Inst. v. Town of Steuben" on Justia Law

After Dorothy Leighton failed to pay taxes on her property and the Town of Blue Hill recorded a tax collector's lien certificate on the property, the Town filed a complaint against Leighton for forcible entry and detainer (FED), seeking possession of the property and costs. The district court entered judgment in Leighton's favor. The superior court vacated the district court's judgment and remanded with instructions to issue a writ of possession in favor of the Town. On appeal, Leighton contended that the Town was required, as a matter of law, to prove that it held current title to the property in the FED action. The Supreme Court affirmed, holding that because the Town produced evidence that it held title superior to Leighton by virtue of the statutorily-foreclosed tax lien mortgage on the property, the Town presented sufficient evidence that it was entitled to possession of the property. View "Town of Blue Hill v. Leighton" on Justia Law

Following a jury trial, appellant Michael Skarbinski was convicted on several counts, all of which arose from appellant's filing requests for tax refunds claiming no taxable income for three years when appellant had received substantial income. The supreme judicial court affirmed, holding (1) the court did not err when it instructed the jury on principles of tax law, and the court's instructions did not infringe upon the jury's role as fact-finder; (2) the court did not err in instructing the jury that if appellant believed the tax laws to be unconstitutional or illegal, or otherwise disagreed with them without an objectively reasonable good faith belief, his belief was not a defense to the charges; (3) the State's closing argument was not inflammatory and it did not improperly interject irrelevant issues into the case; and (4) the jury could have found each element of the offenses charged beyond a reasonable doubt, and the evidence was sufficient to support the convictions. View "State v. Skarbinski" on Justia Law

Appellants Daniel Luker and several other attorneys appealed the grant of summary judgment to the State Tax Assessor on their petitions for review of tax assessments for the 2004 and 2005 tax years. The firm for which they worked was organized as a Maine limited liability partnership (LLP), with its principal place of business in Portland. While the firm was a limited liability corporation (LLC), each attorney joined as a member, but each worked out of the firmâs New Hampshire office. As members of a Maine LLC, the attorneys were required to pay Maine income taxes. In December, 2003, each attorney formed a New Hampshire professional corporation (PC) to hold his respective interest in the Maine LLC. When the firm reorganized as a LLP, each attorney transferred his respective partnership interest in the firm to their individual PCs. Each PC then signed a partnership agreement with the firm. Each attorney was the sole shareholder and director for his PC, and served as the PCâs president, treasurer and secretary. None of the PCs employed office staff or other attorneys. Each PC entered into an arrangement through which it was designated a âco-employerâ of the attorney for purposes of firm profit sharing and benefits. In 2004 and 2005, each PC received partnership distributions from the firm. The size of the distribution depended on the performance of the attorney. The salary of each attorney roughly equated to the size of the distribution they received from the firm. Each PC deducted all payments to its respective attorney as a cost of doing business, thereby minimizing the PCâs taxable income. The State Tax Assessor viewed the creation of the PCs as an attempt to evade Maine income taxes, disregarded the corporate entities and assessed a tax on the distributions as income. The attorneys appealed the assessments. The district court granted summary judgment in the Assessorâs favor, and the Supreme Court agreed with the district court. The Supreme Court in affirming the lower courtâs decision, held that each attorney individually, not his respective PC, earned the income from the partnership distributions, and must pay income taxes.

Victor Bravo Aviation is a Connecticut company founded and established by E. Brian Cleary and his wife Vicki in 2002. In 2004, Victor Bravo contracted to purchase an aircraft from Columbia Aircraft Sales in Connecticut. The aircraft was constructed in France. It was flown to the USA with scheduled stops in Maine and Connecticut in 2005. Victor Bravo took possession of the aircraft in Connecticut as its owner. The aircraft was flown its first twelve months in Maine and other surrounding states. The aircraft made thirty-seven flights to Maine. It was stationary in Maine for 156 days with approximately 121 overnight lay-overs. Victor Bravo never had the aircraft registered in Maine. Victor Bravo was assessed with Maine use taxes on the aircraft in February 2007. Victor Bravo appealed this assessment to the Superior Court which was upheld. On appeal, the Supreme Court made the distinction between the facts of this case with those in the "Blue Yonder" case which was decided April 26, 2011. It was determined that the aircraft owned by Victor Bravo was used in a manner that went beyond having a âtemporary, transient presenceâ in Maine. The Court held that under these circumstances, the aircraft should be properly considered to have âcome to restâ in Maine, and therefore subject to the Maine use tax. The Court affirmed the Superior Court and Assessorâs decisions.

Blue Yonder is a company owned by Stephen Kahn and his wife. Blue Yonder purchased an aircraft from Cirrus Design Corporation in 2002 in Minnesota. Kahn flew the aircraft from Minnesota to Massachusetts. The aircraft was registered in Massachusetts. The aircraft has never been registered in Maine. No sales or use tax has been paid on the aircraft in any jurisdiction. Kahn rented the aircraft from Blue Yonder for his personal and business use, as well as for humanitarian purposes (delivering ill or injured patients to Massachusetts through a charity program). Kahn was the only operator of the aircraft. Kahn owned properties in Maine which he visited using the aircraft. The craft was present in the state for at least twenty-one full days in a twelve-month period. Maine Revenue Service assessed a use tax on the aircraft. Blue Yonder appealed the assessment to the Superior Court. The Superior Court entered judgment for the Assessor. Blue Yonder appealed. The Supreme Court concluded that because the aircraft was used only briefly in Maine, it was exempt from the use tax when it was purchased out-of-state, and was never registered in Maine. The Court vacated the lower courtâs decision.