Square 345 Limited Partnership v. District of Columbia

Summary

The District of Columbia Court of Appeals held that hotel attrition fees charged when event participants failed to reserve a guaranteed minimum number of room nights were subject to the District's hotel sales tax. The court concluded that participants had a taxable right to occupy rooms reserved in the contracted room block, even if they did not actually occupy them. The court also affirmed the refusal to grant equitable relief from interest and penalties because the hotel had adequate legal and administrative remedies.

Holdings

1. Attrition fees are taxable charges for rooms or accommodations furnished to transients under D.C. Code § 47-2002 because the group's participants acquired the right to reserve and occupy the rooms set aside in the room block, even though they did not actually exercise that right.
2. The Superior Court did not err in declining to exercise equitable jurisdiction to reduce or eliminate the interest and penalties because Square 345 had an adequate remedy at law and had been offered an administrative avenue to seek compromise of those amounts.

Questions Presented

1. Whether hotel attrition fees charged when event participants fail to reserve the minimum number of guaranteed room nights constitute taxable charges for rooms or accommodations furnished to transients under D.C. Code § 47-2002.
2. Whether the Superior Court erred by declining to use its equitable powers to eliminate or reduce the interest and late-payment penalties included in the tax assessment.

Disposition

affirmed