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A Better Partnership
February 09, 2017

COA upholds 20-day filing period for appealing a Tobacco Products Tax Act decision

The plain meaning of MCL 205.429, requiring an appeal to be made within 20 days of a Tobacco Products Tax Act (TPTA) decision was unambiguous, and the Michigan Administrative Code, specifically MCL 205.20 does not supersede the TPTA language.
 
In K & W Wholesale, LLC v Dept of Treasury, No. 327107, the Michigan State Police, acting on behalf of Defendant conducted an inspection and subsequent seizure of improperly labeled tobacco products in violation of MCL 205.436(6). Following a hearing and informal conference the referee concluded that the seizure was valid under the TPTA, and on September 22, 2014, the Defendant, after adopting the referee's decision, provided Plaintiff with a Decision and Order of Determination (the "Order"). The Order stated that Plaintiff may appeal the Order, if they disagree, and the "appeal 'must be commenced in circuit court within 20 days of this decision in accordance with . . . MCL 205.429.'"
 
Plaintiff attempted to file a complaint on October 30, 2014 attempting to appeal the order and further arguing that their attorney had not been timely served. Defendants moved for summary disposition under MCR 2.116(C)(4) (lack of subject-matter jurisdiction) and MCR 2.116(C)(7) (violation of statute of limitations), and after a reconsideration hearing, granted Defendant's motion finding that Plaintiff had received the Order September 29, 2014.
 
The Court of Appeals affirmed the trial court's decision. First, the Court of Appeals interpreted the plain meaning of the words of MCL 205.429(4) and held the statute to be unambiguous and further that the 20-day period is trigged by sending notice to the person or persons claiming an interest in the seized property. Second, the Court of Appeals held that the Michigan Administrative Code (the "MAC") is not incorporated into the TPTA forfeiture procedures and does not supersede language in MCL 205.429(4) because the MAC carves out an exception to its authority. The MAC states "[u]nless otherwise provided by specific authority in a taxing statute administered by the department, all taxes shall be subject to the procedures of [the MAC]." Because the TPTA's unambiguous language states "the person or persons claiming an interest in the seized property" required notice, Defendant's service was proper, and Plaintiff's appeal denied.

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