Sullivan v. Reilly

Summary

The Rhode Island Supreme Court affirmed summary judgment for the State Tax Administrator in an action seeking more than $1 million in unpaid personal income taxes from William J. and Marielle Reilly. The court held that the defendants failed to exhaust available administrative remedies and could not challenge the assessments in the collection action. It also held that the statute-of-limitations and laches defenses were waived because they were not properly raised in the answer.

Holdings

1. The defendants were not entitled to judicial review of the Tax Administrator's assessments because they failed to exhaust the available administrative remedies and could not wait to be sued before objecting to the assessments.
2. The Tax Administrator was expressly authorized to file an action to recover assessed taxes, and the collection action was proper.
3. The statute-of-limitations defense was waived because the defendants failed to plead it in their answer.
4. The defendants' laches defense was waived because they failed to properly raise it below and attempted to rely on it for the first time on appeal.
5. Summary judgment for the Tax Administrator was proper because the defendants failed to establish a genuine dispute of material fact or a preserved legal defense defeating collection.

Questions Presented

1. Whether the defendants could challenge the Tax Administrator's assessments in the collection action after failing to exhaust available administrative remedies.
2. Whether the defendants' statute-of-limitations defense barred the Tax Administrator's collection action.
3. Whether the defendants' laches defense barred the collection action.
4. Whether summary judgment was properly entered for the Tax Administrator.

Disposition

affirmed