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Supreme Court
No. 2003-170-Appeal.
(PC 01-4264)
Harvard Pilgrim Health Care                                           :
of New England, Inc.
v.                                                                    :
Thomas Rossi, in his capacity as                                      :
Tax Assessor of the City of Providence.
NOTICE:                                                               This opinion is subject to formal revision before
publication in the Rhode Island Reporter.  Readers are requested to
notify the Opinion Analyst, Supreme Court of Rhode Island, 250
Benefit Street, Providence, Rhode Island 02903, at Telephone 222-
3258 of any typographical or other formal errors in order that
corrections may be made before the opinion is published.




Supreme Court
No. 2003-170-Appeal.
(PC 01-4264)
Harvard Pilgrim Health Care                                                                            :
of New England, Inc.
v.                                                                                                     :
Thomas Rossi, in his capacity as                                                                       :
Tax Assessor of the City of Providence.
Present: Williams, C.J., Flanders, Goldberg, Flaherty, and Suttell, JJ.
O P I N I O N
PER CURIAM.  The City of Providence (the city or defendant) appeals from a Superior
Court judgment awarding Harvard Pilgrim Health Care (Harvard Pilgrim or plaintiff)
$484,907.46, plus $93,580.49 in interest and costs, for overassessing taxes on its ratable, tangible
personal property for tax year 2000. This case came before the Supreme Court for oral argument
pursuant to an order directing the parties to show cause why the issues raised on appeal should
not summarily be decided.  After hearing the arguments of counsel and examining the record and
the memoranda filed by the parties, we are of the opinion that cause has not been shown, and we
affirm the judgment entered in the Superior Court.
Facts and Travel
After unsuccessfully appealing assessments to the Providence Board of Tax Assessment
Review, Harvard Pilgrim filed four separate actions in Superior Court alleging that the city
valued its ratable personal property for tax years 1997, 1998, 1999, and 2000, respectively, in
excess of fair market value in violation of G.L.  1956  §  44-5-12.    The four actions were
consolidated for trial and heard before a trial justice without the intervention of a jury.   After
several days of hearings and the submission of post-trial memoranda, the trial justice found in
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favor of the city for three of the years, and held in favor of Harvard Pilgrim for tax year 2000.
Judgment was entered on March 26, 2003, and the city timely appealed.
For tax  year  2000,  the  city  valued  Harvard Pilgrim’s  ratable,  tangible  property  at
$9,183,600, and assessed $770,136.70 in taxes, which Harvard Pilgrim paid in four quarterly
installments.   Harvard Pilgrim, however, asserted that this valuation exceeded fair market value
in violation of § 44-5-12(a), which provides in pertinent part:
“All property subject to taxation shall be assessed at its full and
fair cash value or at a uniform percentage of its value, not to
exceed  one  hundred  percent  (100%),  to  be  determined  by  the
assessors in each town or city * * *.”
Harvard Pilgrim proffered evidence at trial that the fair market value of its tangible personal
property as of December 31, 1999, was $3,401,225, and therefore the correct tax amount for tax
year 2000 was $285,229.24. Harvard Pilgrim thus sought a tax rebate of $484,907.46.
Thomas  Rossi  (Rossi),  the  named  defendant  in  his  capacity  as  the  city’s  then-tax
assessor, testified that the formula the city used to establish fair market value for items of
tangible personal property was “acquisition cost minus depreciation.”   He further testified that
his office used the information supplied by the taxpayer on the annual return and applied various
depreciation schedules for furniture and equipment, computers, and leasehold improvements.
The city conceded at trial that its acquisition cost minus depreciation approach may not reflect
precise fair market value; nevertheless, the city argued, it treats taxpayers uniformly and its
methodology is the best approximation of fair market value that can be ascertained while
achieving that uniformity.
The trial justice held that although the city’s formula for determining fair market value
was not, in and of itself, an illegal method of tax assessment, the city’s valuation of Harvard
Pilgrim’s tangible personal property for tax year 2000 did not properly reflect the fair market
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value of Harvard Pilgrim’s ratable assets.   The trial justice found in favor of Harvard Pilgrim for
tax year 2000 and entered judgment of $484,907.46, together with interest and costs.
Three months after the close of the evidence, but before the trial justice issued his written
decision, the city filed a motion for judgment on partial findings pursuant to Rule 52(c) of the
Superior Court Rules of Civil Procedure, alleging that Harvard Pilgrim’s failure to file a “true
and exact account” precluded judicial review as a matter of law.  Without specifically addressing
the city’s Rule 52(c) argument, the trial justice denied the motion, opining that it was an integral
part of his analysis and subsumed in his decision.
Jurisdiction of the Superior Court
On appeal, the city argues first that the annual account Harvard Pilgrim filed on January
31,  2000,  was insufficient under  §§  44-5-15 and  44-5-16 to vest the Superior Court with
jurisdiction.   The city asserts that Harvard Pilgrim’s submitted account was not a “full and exact
account and valuation” of its property and, therefore, that Harvard Pilgrim failed to satisfy a
condition precedent to judicial review.
It is well established that the Superior Court has subject-matter jurisdiction to hear tax
abatement claims. Granoff Realty II Limited Partnership v. Rossi, 833 A.2d 354, 358 (R.I. 2003)
(per  curiam)                                                                                          (Granoff  Realty).    To  invoke  the  court’s  jurisdiction  properly,  however,  the
petitioner must satisfy the statutory preconditions as set forth in § 44-5-16. Granoff Realty, 833
A.2d at  358.    We have determined that the timely filing of an adequate account and the
notarization of the account are both conditions precedent that must be met to invoke the
jurisdiction of the court. Wickes Asset Management, Inc. v. Dupuis, 679 A.2d 314, 318 (R.I.
1996).
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It is firmly established that when a defendant fails to plead at trial that a plaintiff did not
file an adequate account pursuant to § 44-5-15, “such a failure could constitute waiver of that
defense on appeal.” Granoff Realty, 833 A.2d at 359 (citing Chase v. Bouchard, 671 A.2d 794,
796 (R.I. 1996)).                                                                                      “[L]ike any condition precedent, it must be pleaded and must be called to the
attention of the trial justice prior to trial and in accordance with Rule 9(c) of the Superior Court
Rules of Civil Procedure.” Granoff Realty, 833 A.2d at 359 (quoting Chase, 671 A.2d at 796).
In this case, the city did not raise the argument asserting an inadequate account until three
months after the hearing, when it filed a motion to amend its answer to include it as an
affirmative defense and also filed a Rule 52(c) motion asserting the failure of Harvard Pilgrim to
meet its statutory obligations.  The trial justice granted the motion to amend, noting that Harvard
Pilgrim had not filed an objection.
Although Harvard Pilgrim did object to the timeliness of the city’s Rule 52(c) motion
before the trial justice gave his decision, it has not raised a similar argument on appeal. We will
proceed, therefore, to address the merits of the city’s contention that Harvard Pilgrim failed to
satisfy the statutory requirement of filing a “true and exact” account.
The Sufficiency of Harvard Pilgrim’s Annual Account
Because the essential facts are not in dispute, the issue before us is solely one of statutory
construction.  This Court reviews questions of statutory interpretation de novo. State v. Fritz, 801
A.2d 679, 682 (R.I. 2002) (citing Rhode Island Depositors Economic Protection Corp. v. Bowen
Court Associates, 763 A.2d 1005, 1007 (R.I. 2001)).  When the language of a statute is clear and
unambiguous, we must enforce the statute as written by giving the words of the statute their plain
and ordinary meaning. In re Chaselle S., 798 A.2d 892, 894 (R.I. 2002) (per curiam) (citing
Cummings v. Shorey, 761 A.2d 680, 684 (R.I. 2000)). When a statute is ambiguous, however,
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we must apply the rules of statutory construction and examine the statute in its entirety to
determine the intent and purpose of the Legislature. Direct Action for Rights and Equality v.
Gannon, 819 A.2d 651, 659 (R.I. 2003).
Section 44-5-15 provides that an account must include:
“a  true  and  exact  account  of  all  the  ratable  estate  owned  or
possessed by that person or body, describing and specifying the
value of every parcel of the real and personal estate, together with
the additional information that may be prescribed by the assessors
relative to the ratable estate as may be contained in any corporation
* * * tax return * * *.” (Emphases added.)
Section 44-5-16(a) provides in pertinent part:
“Every person bringing in any account shall make oath before
some notary public * * * that the account by that person exhibited
contains, to the best of his or her knowledge and belief, a true and
full  account  and  valuation  of  all  the  ratable  estate  owned  or
possessed by him or her; and whoever neglects or refuses to bring
in the account, if overtaxed, shall have no remedy therefor, except
* * *.”
Here,  the  account  submitted  by  Harvard  Pilgrim consisted  of  a  four-page  “Annual
Return” form furnished by the city, along with a detailed computer printout entitled “Net Book
Value Report” appended to the form.   The printout consists of an itemized list of tangible
personal property, including acquisition cost, year of acquisition, and depreciation amount.   Our
inquiry is to determine whether this account satisfied the statutory requirement.
The city argues that strict compliance with the statute is required. This Court has required
strict compliance for two separate, clear, and unambiguous directives of the statute:   that an
account be submitted and that the account be notarized.   See Granoff Realty, 833 A.2d   at 358
(holding that                                                                                        “[n]othing in   [§   44-5-16] confers authority upon the judiciary to ignore the
statutory requirement that the list be accompanied by either a personal oath or a written
appointment”).   In the case at hand, the city does not question that Harvard Pilgrim submitted a
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notarized account; rather, its only contention is that it was not a “true and exact account” in
conformance with § 44-5-15.
This Court has determined that the legislative intent is to require such sufficiency in the
description of the personal property as to be of assistance to the assessor in assessing a tax
against each item.   Sayles Finishing Plants, Inc. v. Toomey, 95 R.I. 471, 481, 188 A.2d 91, 97
(1963).    A generic classification is insufficient. See id.  (citing Ewing v. Tax Assessors of
Jamestown, 93 R.I. 372, 375-76, 176 A.2d 69, 71-72 (1961)).   The taxpayer also must present
reasons for why its property is not taxable.   See Ewing, 93 R.I. at 376, 176 A.2d at 72 (listed
reason of “[n]ot taxable” was insufficient).
The account at issue was filed by Harvard Pilgrim on January 31, 2000. Using forms
provided by the city assessor’s office, it itemized nearly 9,000 items of tangible personalty,
including  computer  equipment,  inventory,  leasehold  improvements,  furniture,  and  office
equipment. The net book value report listed the acquisition cost and current depreciation for each
item.
The city argues that this account was inadequate in that it failed to provide the age,
condition and all other related information with respect to each of the nearly 9,000 items, such
that the assessor might determine the fair market value.    Recognizing that the  “purpose of
requiring a true and exact account * * * is to aid the assessors in performing their duty to make a
proper assessment,”   Ewing, 93 R.I. at 375, 176 A.2d at 71, the city maintains that Harvard
Pilgrim’s account was too vague as a matter of law to sustain an appeal to the Superior Court.
The city’s rationale is somewhat specious in light of the practice employed by the
assessor’s office. It was firmly established at trial that the only figure that the city used in
determining the fair market value of any item of ratable property was its acquisition cost.   The
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city then applied its own depreciation schedule to ascertain valuation.   The trial justice did not
find this methodology illegal.  Yet, it is abundantly clear that no matter how much detail Harvard
Pilgrim might have provided, the only factor that would have aided the assessor was the
acquisition cost.
We are persuaded that the account filed by Harvard Pilgrim on January 31, 2000, was
indeed in reasonable compliance with the provisions of §§ 44-5-15 and 44-5-16. See   Ewing, 93
R.I. at 376, 176 A.2d at 71.  We disagree with the city’s contention that an exhaustive analysis of
each item is required to invoke the statutory review process.   Here, Harvard Pilgrim timely
provided an itemized list of nearly 9,000 items of ratable personal property, listing acquisition
cost, in-service date, depreciation, and net book value of each item.   The provision of more
detailed information clearly would not have “aided” the assessor in this situation.   Rather, the
purpose of submitting any information other than acquisition cost was completely frustrated by
the methodology that the city employed.   We conclude, therefore, that Harvard Pilgrim did file a
“true and exact account * * * describing and specifying the value” of all its ratable personal
estate sufficient to invoke the statutory appeal process to challenge the city’s assessment.
We now proceed to review the second issue that the city raised on appeal.
The Competency of Harvard Pilgrim’s Evidence
Regarding Valuation
During the trial, Harvard Pilgrim presented, as an expert witness, George Moses, a
former assessor for the City of Boston.   He testified that in 1997, while employed by Ernst &
Young, he had been engaged by Harvard Pilgrim to review the manner, reporting and filing of its
annual accounts to the city.   He in turn hired Norman Levy and Associates (Levy) to identify
Harvard Pilgrim’s assets and to establish their fair market value.   The inventory and appraisal
were conducted by John G. McEachern of Levy.   He testified that he inspected each asset and
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valued it by consulting charts, Levy’s database, Blue Books, and by speaking to dealers in the
field.  The completed report (Levy report) dated August 12, 1998, was admitted into evidence.
The trial justice, however, refused to apply the appraisal report retroactively, and entered
judgment for the city with respect to the actions filed for tax years 1997 and 1998.   He further
found that Harvard Pilgrim’s appeal for 1999 was untimely filed, and entered judgment for the
city on it.   With respect to tax year 2000, he accepted the evidence Harvard Pilgrim submitted
concerning the fair market value of its assessable assets, and entered judgment in its favor.
In attempting to establish the fair market value of its ratable property for tax year 2000,
Harvard Pilgrim called as a witness Jeffrey Lieberman  (Lieberman), the project director in
charge of managing the liquidation of Harvard Pilgrim.1   He authenticated various documents
and confirmed the figures used as the basis for the Levy report.   Through his testimony, Harvard
Pilgrim introduced into evidence an “Application for Abatement of Property Tax for fiscal year
2000” (exhibit No. 15).   According to Lieberman, it was the document that Harvard Pilgrim
relied upon for what it believed to be the proper valuation and assessment.   He acknowledged,
however, that he was not an appraiser, and he was therefore unable to determine independently
the value of any item in the report.
“[T]ax  assessors  are  entitled  to  a  presumption  that  they  have  performed  their  acts
properly  until  the  contrary  is  proven.”  Willow  Street  Associates  LLP  v.  Board  of  Tax
Assessment Review, 798 A.2d 896, 899-900 (R.I. 2002) (per curiam) (quoting Ferland Corp. v.
Bouchard, 626 A.2d 210, 215 (R.I. 1993)).  The taxpayer has the burden of proof to establish that
the assessor has set a value on the subject property that exceeds fair market value. Id. at 900
1 Harvard Pilgrim was placed into rehabilitation on October 25, 1999, and into liquidation on
January 10, 2000, pursuant to G.L. 1956 chapters 14.3 and 14.4 of title 27.
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(citing Ferland Corp., 626 A.2d at 215).   Here, the trial justice found that the value set by the
assessor exceeded fair market value.
We begin our analysis with a reiteration of the established principles of appellate review.
The standard of review of the finding of a trial justice sitting without the intervention of a jury is
extremely deferential. Granoff Realty II, Limited Partnership v. Rossi, 823 A.2d 296, 298 (R.I.
2003) (per curiam).   This Court will overturn the findings of a trial justice sitting without a jury
only  “when the justice misconceives or overlooks material evidence or otherwise is clearly
wrong.” Id.   A trial justice is in a better position to weigh the credibility of the witnesses as they
testify. Rotelli v. Catanzaro, 754 A.2d 104, 105 (R.I. 2000) (mem.).  With these principles firmly
in mind, we proceed to evaluate the city’s assertions.
On appeal, the city argues that the admission of plaintiff’s exhibit No. 15 was error.   It
asserts that Lieberman had neither personal knowledge of the source of the figures set forth in
exhibit No. 15 nor expertise upon which any of the calculations of value could be predicated.
Lacking an expert witness to establish valuation, Harvard Pilgrim is simply unable, as a matter of
law, the city argues, to overcome the presumption that the assessor properly performed his
duties.
Harvard Pilgrim counters that the trial justice properly accepted evidence submitted in its
exhibit No.  15.    It asserts that it submitted competent evidence through the testimony and
appraisal of John McEachern (an accredited appraiser), the testimony and documents of George
Moses  (an  economist  with  past  experience  as  an  assessor),  as  well  as  the  testimony  and
documents  of  Lieberman.    It  says  that  McEachern  authenticated  the  appraisal  report  and
Lieberman authenticated the other documents.
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After reviewing the record, we conclude that the city raised no objection at the trial level
to Lieberman’s testimony, and therefore has waived this argument.   This Court will not review
issues that are raised for the first time on appeal. State v. Grant, 840 A.2d 541, 546 (R.I. 2004).
It is well established that a “litigant must make a timely and appropriate objection during the
lower court proceedings before this Court will hear the issue on appeal.” Id. (citing State v.
Toole, 640 A.2d 965, 972-73 (R.I. 1994)).   A general objection will not preserve an issue for
appellate review; “assignments of error must be alleged with sufficient particularity so it will call
the trial justice’s attention to the basis of the objection.” Id. at 546-47.
The city further argues that there was no competent expert evidence to establish that
Harvard Pilgrim’s appraisal of the fair market value of its tangible personal property as of
December 31, 1999, met industry standards.   Rather, it asserts, Harvard Pilgrim simply used the
Levy report valuations as of December 31, 1997, as the basis of its valuations for December 31,
1999,  in direct contravention of the Levy report’s admonition that the report was neither
retrospective nor prospective.   Then, the city argues, Lieberman “piggy-backed” onto the Levy
report the acquisition costs, as adjusted, for items acquired in  1998 and  1999.    Lieberman
testified that these adjustments included deductions for freight and shipping costs, exclusions for
custom software and costs for installing hardware, and an obsolescence adjustment for computer
assets.   The city argues that all such adjustments are inadmissible because Lieberman was not an
expert.   Harvard Pilgrim, on the other hand, maintains that he testified from “factual experience
in the offices of Harvard Pilgrim.”
Once again, we conclude that the city did not properly preserve this issue for appellate
review as they did not enter an objection at the time of Lieberman’s testimony.   Under our well-
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settled raise or waive rule, we conclude that the city waived its right for appellate review of this
argument.  See Plourde v. Myers, 823 A.2d 1138, 1143 (R.I. 2003) (per curiam).
Moreover, “[t]he admission of evidence rests in the sound discretion of the trial justice
and will not be disturbed absent a showing of an abuse of that discretion.” Graff v. Motta, 748
A.2d 249, 252 (R.I. 2000) (quoting New Hampshire Insurance Co. v. Rouselle, 732 A.2d 111,
113  (R.I.  1999)  (per curiam)).   The trial justice did not abuse his discretion in finding the
testimony of Lieberman, along with Harvard Pilgrim’s other witnesses, credible.    Issues of
credibility are questions of fact.
After a careful review of the record, we conclude that the trial justice did not err in
accepting the evidence submitted by Harvard Pilgrim as competent on the issue of the fair
market  value  of  plaintiff’s  property.    The  record  shows  that  the  trial  justice  thoughtfully
considered the evidence presented by both parties, and chose to credit the evidence proffered by
Harvard Pilgrim.
After considering Lieberman’s background, specifically the facts that he has a master’s
degree in business administration and is certified in the area of hospital financial management,
working since 1980 almost exclusively in the hospital industry, the trial justice stated:
“Through  Lieberman,  Harvard  Pilgrim  introduced  an
exhibit (Plaintiff’s Ex. 15) which contained among other things, a
summary  of  Harvard  Pilgrim’s  1998  and  1999  acquisitions  of
office   fixtures   and   equipment   and   computers,   leasehold
improvements  and  the  Norman  Levy  appraisal  of                                                        1998  with
applicable exclusions and/or adjustments.   The adjustments made
for  office  equipment  acquisition  costs  were  to  remove  certain
freight, labor and shipping costs; and, adjustments for computer
software  and  hardware,  were  to  remove  installation  costs  for
customized software, remove engineering and design costs as well
as shipping and consulting costs.   Harvard Pilgrim justified the
adjustments on the ground that they were not assessable or ratable
costs.   Harvard Pilgrim applied an obsolescence adjustment to the
computer equipment acquired during 1998 and 1999 based upon its
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experience of selling such assets on the open market at about 20%
of acquisition cost.   Finally, Harvard Pilgrim made adjustments to
leasehold improvements because certain of the reported assets had
been previously abandoned.”
He then found that
“the City’s depreciation schedules and methods used for tax year
2000 do not reflect the fair market value of Harvard Pilgrim’s
assets.                                                                                  * * *  The  failure  of  the  City  to  consider  physical
depreciation  and  obsolescence  factors  among  other  things  as
argued  by  Harvard  Pilgrim  renders  the  City’s  method  of
assessment  fundamentally  flawed  as  constituted  and  applied
* * *.”
We are satisfied that the trial justice was well within his discretion so to find.
For the aforementioned reasons, we affirm the judgment of the trial justice and remand
the record to the Superior Court.
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COVER SHEET
TITLE OF CASE:   Harvard Pilgrim Health Care of New England, Inc. v. Thomas
Rossi, in his capacity as Tax Assessor of the City of Providence
DOCKET SHEET NO :                                                             2003-170
(PC 01-4264)
COURT:                                                                        Supreme
DATE OPINION FILED:   May 6, 2004
Appeal from
SOURCE OF APPEAL:    Superior                                                 County:  Providence
JUDGE FROM OTHER COURT:      Cresto, J.
JUSTICES:                                                                     Williams, CJ., Flanders, Goldberg, Flaherty and Suttell, JJ.
                                                                              Not Participating -
                                                                              Concurring-
                                                                              Dissent-
WRITTEN BY:                                                                   Per Curiam
ATTORNEYS:                                                                    Richard J. Welch
For Plaintiff
ATTORNEYS:                                                                    Caroline Cole Cornwell
For Defendant
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