A conversation with Honorable Charles R. Beaudrot Jr., Chief Judge of the Georgia Tax Tribunal.

Judge Michael Malihi and Judge Charles R. Beaudrot Jr.
discuss the Georgia Tax Tribunal

Judge Malihi:  When were you appointed to your current position as the first judge of the Georgia Tax Tribunal?

Judge Beaudrot:  After an extensive review of well-qualified candidates, Gov. Deal appointed me as the first Chief Judge of the Georgia Tax Tribunal in November 2012.  I assumed my duties on January 2, 2013, joined by my long-time assistant, Yvonne Bouras, in the critical position of Tax Tribunal Administrator.

Judge Malihi: What did you do before your appointment by Governor Deal?

Judge Beaudrot:  Before coming to the Tax Tribunal, I practiced for 36 years as a tax lawyer in private practice.  For the last 30 years I practiced as the senior tax partner at Morris, Manning & Martin, LLP here in Atlanta.

Judge Malihi: I understand that you are an accomplished composer and singer.

Judge Beaudrot:  I have sung since I was seven years old, first in my hometown of Greenwood, South Carolina, then at Duke Chapel as an undergraduate, and then at Harvard at Memorial Church.  I have also composed music, mostly choral music, since high school.  Since coming to Atlanta, I have sung as a member of the Choir of the Cathedral of St. Philip; the Cathedral Choir has premiered many of my compositions over the years.  In August I sang with the Cathedral Choir while we were in residence at St. Paul’s Cathedral in London.  For a week, we sang music—including one of my compositions—at daily services.

Judge Malihi: Tell me about your extensive collection of Japanese art.

Judge Beaudrot: One of my other hobbies is collecting Japanese cloisonné from the Meiji period (1868-1912).  I have almost 500 items in my collection.  My focus is on pieces with birds in the artwork.

Judge Malihi: The Tax Tribunal is a recent innovation—how did it come to be established?

Judge Beaudrot:  On April 19, 2012, Georgia Governor Nathan Deal signed into law the Georgia Tax Tribunal Act of 2012.  The legislation, which is codified at Georgia Code Sections 50-13A-1 through 50-13A-20, created the Georgia Tax Tribunal as of January 1, 2013.

Prior to the establishment of the Georgia Tax Tribunal, the notion of creating a specialized Georgia tax court had been percolating for some time. The idea was brought to fruition primarily due to the recommendations of the 2010 Special Council on Tax Reform and Fairness, a legislatively-created body charged with studying Georgia’s tax system and making suggestions for improvement.

The Commission, in its January 2011 Final Report, recommended, first, the establishment of a specialized tax court for the resolution of tax disputes and, second, only appointing experienced tax practitioners to occupy the new judicial seat. The goal was to “enhance Georgia’s position as a business friendly state” by increasing the transparency and predictability of tax administration.

Legislation adopting the Commission’s recommendations was introduced during the 2012 Legislative Session by Rep. Allen Peake (R-Macon).  The legislation garnered widespread support and passed without a single dissenting vote.

Judge Malihi: How has your experience been in getting the Tax Tribunal up and running?

Judge Beaudrot: The process of setting the Tax Tribunal into operation has exemplified the absolute best in public service and professionalism, with collaboration and commitment from within the tax practitioner community and beyond.  This support has included active involvement from the Attorney General’s office, the lawyers and staff at the Department of Revenue, the members of the Georgia Society of CPAs, and the private bar.  Judges Max Wood and Michael Malihi of the Office of State Administrative Hearings, where we share office space and administrative support, have also been instrumental in helping the Tribunal begin operations.

With this support, the Tribunal has been able to hit the ground running.  Since opening on January 2, our case load has grown exponentially.  As of September 1, 2013, 536 cases have been filed and 202 cases have been resolved, leaving an active case load of 324.  The Tribunal has also established a website, www.gataxtribunal.ga.gov, containing useful information and resources for litigants.  For a valuable summary of the operations of the Tax Tribunal, I would also refer interested persons to the article by Richard Litwin and John Masters in the December issue of the Georgia Bar Journal, December 2012, Volume 18, No. 4.

Judge Malihi: Is there any general advice you have for litigants before the Tax Tribunal?

Judge Beaudrot: Tax litigation is, by definition, specialized—on one side of the dispute is always a taxpayer and, on the other, the State of Georgia.  Any party appearing before the Tribunal must remember several things.  First, the government is a unique litigant.  It does not have the same motivations or incentives as private litigants.  It is an institutional party and the litigation is recurring so it must consider the impact of a settlement on other potential parties that are similarly situated. The State may choose to settle a case when it is ready, but not before.  Because of the nature of the government as a litigant, the “scorched earth” or “slash and burn” approach to litigation propounded by some lawyers, if ever appropriate, has no place whatsoever in tax litigation before the Tribunal.  Second, there is no jury—only a judge, an important factor to consider in determining strategy and behavior. 

Judge Malihi: What is the general philosophy behind the Tax Tribunal approach?

Judge Beaudrot: The goal of the Georgia Tax Tribunal is to emulate the prompt and thoughtful resolution of tax cases that has been the hallmark of the U.S. Tax Court.  To that end, the Tax Tribunal Rules require parties to resolve factual and other evidentiary matters prior to trial to the fullest extent possible.

Judge Malihi: What should parties know about discovery in a Tax Tribunal case?

Judge Beaudrot: Under Tribunal rules, parties must negotiate and stipulate as to non-disputed matters, facilitating resolution on motions for summary determination in a majority of instances.  However, in the event of a trial, parties are directed, in connection with the pre-trial order, to stipulate to documents and facts to the fullest extent possible.  Validity and relevance should only be raised if genuinely disputed. Because the taxpayer tends to be in possession of facts in a tax dispute, discovery will generally be directed at the private party.  Discovery disputes are intended to be rare and the Tax Tribunal will view delay tactics and “fishing expeditions” unfavorably, and will require considerable justification for burdensome discovery requests. Both sides must cooperate to minimize costs and assure prompt resolution of cases.  

Judge Malihi: Are there any special rules for parties with claims that are relatively small?

Judge Beaudrot: Yes, to make the Georgia Tax Tribunal readily accessible to taxpayers in tax cases involving relatively insubstantial amounts of money, there is a Small Claims Division.  Generally, a case can proceed within the division if (1) the taxpayer so elects and (2) the dollar limitations are met, although the judge may choose to treat the dispute as a non-small claims case where appropriate.  The dollar limits vary depending on whether the dispute involves an income tax liability or any other type of tax dispute.  In the former case, the amount in controversy must be less than $15,000, including principal and penalties but excluding interest.  In the latter case, the amount in controversy limit jumps to $50,000 or less.

There are both advantages and disadvantages to filing a case in the Small Claims Division. The advantages in doing so include:

• no filing fee
• informal and less extensive procedural requirements
• an accountant can appear to explain facts for the taxpayer, although he or she may not act as legal representation
• faster resolution
• no bond requirement

The disadvantages are that any Small Claims Division decision is final, binding, and may not be appealed.  Furthermore, the informality and speed provide fewer opportunities for discovery and development of a factual record.

Judge Malihi: Are there any specialized procedures of which a litigant should be aware?

Judge Beaudrot: The Tax Tribunal automatically remands all cases to Revenue Department for up to 90 days following the filing of the petition for a hearing.  The purpose is to allow the Department to address questions regarding the proper crediting of payments and the like.  Because many tax cases are triggered by computer-generated notices, mistakes can often be resolved by consulting with the Department.  Despite this standing order, either party can request the case be returned to the Tax Tribunal for consideration prior to the end of the remand period.  An answer to the petition is not due until 30 days after the remand period ends.

http://gataxtribunal.georgia.gov/sites/gataxtribunal.georgia.gov/files/related_files/document/Standing-Remand-Order-for-Tax-Tribunal.pdf

Judge Malihi: What is the timeline of a typical Tax Tribunal case?

Judge Beaudrot: The projected timeline for a Tax Tribunal case will differ depending on whether it is a small claims or non-small claims case.  I have provided the following chart to give litigants a general sense of how long a case may be expected to take from the time of filing a petition to trial.