McMaster Development, LLC v. Town of Derry

THE STATE OF NEW HAMPSHIRE

SUPREME COURT

In Case No. 2025-0131, McMaster Development, LLC v. Town of Derry, the court on September 16, 2026, issued the following order:

The court has reviewed the written arguments and the record submitted on appeal and has determined to resolve the case by way of this order. See Sup. Ct. R. 20(3). The plaintiff, McMaster Development, LLC (McMaster) appeals an order of the Superior Court (Ruoff, J.) granting the defendant Town of Derry's (Town) motion to dismiss McMaster's declaratory judgment action pertaining to an assessment of a land use change tax (LUCT). See RSA 79-A:7, I (2012). We reverse and remand.

The following facts are derived from McMaster's complaint and accompanying documentation and are assumed to be true for the purposes of this appeal. See Barufaldi v. City of Dover, 175 N.H. 424, 425 (2022). On June 21, 2021, McMaster purchased three building lots totaling 9.94 acres from Nikko Land LLC (Nikko). The three lots McMaster purchased were previously part of a 32.11-acre parcel subject to current use taxation, which Nikko received approval to subdivide into six building lots. The deed from Nikko to McMaster separately describes each lot by address — 43 Mill Road, 45 Mill Road, and 49 Mill Road — and with reference to the recorded and approved subdivision plan for the parent lot, along with the unique map and lot number and exact acreage for each parcel. The deed was recorded and notice of the transfer was provided to the Town on July 1, 2021. McMaster built homes on each lot and subsequently sold each of the three lots to separate third parties. The sales occurred in late 2021 and early 2022. In February 2023, the Town assessed a LUCT for each lot and mailed each new owner an invoice for $15,000. The new owners of each lot demanded that McMaster pay the LUCT bills. McMaster paid the Town for all three invoices under protest, asserting in an accompanying letter that the assessments were untimely because the Town imposed them more than 18 months after receiving notice of the sale of the lots to McMaster. See RSA 79- A:7, II(c) (2012) (requiring that LUCT bill be mailed to property owner within 18 months of when "local assessing officials receive written notice of the change of use from the landowner" or when officials "actually discover" change of use). On March 27, 2023, McMaster filed three abatement applications with the Town. The Town provided no notice to McMaster of any action on the

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abatement applications until McMaster inquired several months later. Upon inquiry, the Town informed McMaster that it denied the abatements, that it was not required to provide notice of these decisions, and that McMaster's appeal period had run.

In September 2024, McMaster brought a declaratory judgment action in the superior court requesting that the court determine whether the Town

"knowingly exceeded the limits of [its statutory] authority by illegally and unlawfully issuing and mailing" the three LUCT invoices outside of the 18- month period provided in RSA 79-A:7, II(c). The Town moved to dismiss, arguing that McMaster failed to timely appeal the denial of the abatement requests. The trial court granted the Town's motion to dismiss in reliance upon RSA 79-A:10, III, which provides that persons aggrieved by the municipality's denial of, or neglect to rule upon, a LUCT abatement request must appeal to either the board of tax and land appeals (BTLA) or the superior court within eight months of the notice of tax date. See RSA 79-A:10, III, IV (2012). The court determined that McMaster had not alleged it filed an appeal to the BTLA and that it filed the present suit in superior court well after the eight-month statutory appeal period. Accordingly, the court concluded that McMaster's failure to timely appeal the Town's neglect of the abatement requests in accord with RSA 79-A:10, III precluded the court from hearing McMaster's claim. McMaster unsuccessfully moved for reconsideration. This appeal followed.

When reviewing an order granting a motion to dismiss, we assume the truth of the facts alleged in the plaintiff's pleadings and construe all reasonable inferences in the light most favorable to the plaintiff. See Ortolano v. City of Nashua, 177 N.H. 359, 361 (2025), 2025 N.H. 23, ¶5. The standard of review in considering a motion to dismiss is whether the plaintiff's allegations are reasonably susceptible of a construction that would permit recovery. Id. at 362, 2025 N.H. 23, ¶5. This threshold inquiry involves testing the facts alleged in the pleadings against the applicable law. Id. We may also consider documents attached to the plaintiff's pleadings, as well as documents the authenticity of which the parties do not dispute, official public records, and documents sufficiently referred to in the complaint. Id. We will uphold the granting of the motion to dismiss if the facts pled do not constitute a basis for legal relief. Id.

On appeal, McMaster does not dispute the trial court's conclusion that it failed to comply with the appeal deadline set forth in RSA 79-A:10, III. Instead, relying on Pheasant Lane Realty Trust v. City of Nashua, 143 N.H. 140 (1998), and Porter v. Town of Sandwich, 153 N.H. 175 (2006), McMaster argues that it is not limited to the remedies available via the LUCT abatement process under RSA 79-A:10 because the complaint requests the determination of a legal

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question: whether the Town's assessment of the LUCT bills was untimely and therefore exceeded the Town's statutory taxing authority. The Town counters that a taxpayer cannot use a declaratory judgment action "to circumvent the abatement appeals process" and that the cases McMaster relies upon are distinguishable. Thus, the parties dispute whether McMaster was limited to seeking relief through the administrative LUCT abatement process set forth in RSA 79-A:10 on its claim that the Town exceeded its taxing authority by issuing untimely LUCT invoices. We conclude that the abatement procedure in RSA 79-A:10 does not provide the sole available remedy for McMaster's claim and that McMaster can pursue its claim in this declaratory judgment action. We have described "[t]he New Hampshire tax abatement statutes [as] remedial in nature" and as "provid[ing] the exclusive remedy available to a taxpayer dissatisfied with an assessment made against his property." Signal Aviation Servs. v. City of Lebanon, 164 N.H. 578, 582 (2013) (quotation omitted) (discussing RSA chapter 76). We have historically strictly enforced the statutory deadlines for requesting a tax abatement from a municipality and for appealing a municipality's denial of such a request. See, e.g., Appeal of City of Concord, 161 N.H. 169, 172-73 (2010) (holding that BTLA lacked jurisdiction to consider LUCT abatement appeal because taxpayer's abatement request to city was untimely under RSA 79-A:10, I); Appeal of Estate of Van Lunen, 145 N.H. 82, 84-85 (2000) (affirming BTLA's denial of certain abatement requests because taxpayer failed to timely appeal town's denials to BTLA). Indeed, we have described compliance with such a statutory appeal deadline as a

"necessary prerequisite" to establishing jurisdiction over a tax abatement appeal. Phetteplace v. Town of Lyme, 144 N.H. 621, 625 (2000) (quotation and emphasis omitted).

Nevertheless, we have also recognized in the tax abatement context that

"[a] party is not required to exhaust administrative remedies" — specifically, by pursuing an abatement with the municipality and timely appealing the municipality's denial or neglect of the request — "where the issue on appeal is a question of law rather than a question of the exercise of administrative discretion." Pheasant Lane, 143 N.H. at 141-42 (quotation omitted); see also Signal Aviation, 164 N.H. at 582 (summarizing RSA chapter 76 abatement process). In Pheasant Lane, we concluded that the taxpayer's failure to request an abatement from the municipality under RSA chapter 76 did not bar its declaratory judgment action and request for injunctive relief because the "only substantive issue" raised in its suit and on appeal was the legality of the assessment — whether the city had statutory authority to issue a supplemental assessment of underassessed property. Pheasant Lane, 143 N.H. at 141-42. In Porter, we described Pheasant Lane as holding that "a plaintiff raising a question of law is not necessarily required to follow the statutorily prescribed abatement procedure." Porter, 153 N.H. at 177. Applying that principle in

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Porter, we determined that the taxpayers' failure to comply with the RSA chapter 76 abatement procedure did not bar their action because their claims posed questions "as to the legality of the assessment." Id. at 178. Although these cases were decided in the context of taxes assessed under RSA chapter 76 (2012 & Supp. 2025), see Pheasant Lane, 143 N.H. at 141-42; Porter, 153 N.H. at 176, not the assessment of LUCTs governed by RSA chapter 79-A (2012 & Supp. 2025), these two statutory abatement schemes are analogous. Compare RSA 79-A:10, with RSA 76:16, I(b) (Supp. 2025), RSA 76:16-a, I (Supp. 2025), RSA 76:16-d, II (2012), and RSA 76:17 (Supp. 2025). We therefore find these cases instructive. Accordingly, we must examine the nature of McMaster's claim.

The complaint requests that the court interpret RSA 79-A:7, II and related regulations to determine whether the Town mailed the LUCT invoices outside of the time period during which it had statutory authority to do so. RSA 79-A:7, II(c) provides, in relevant part, that a LUCT bill:

shall be mailed, at the latest, within 18 months of the date upon which the local assessing officials receive written notice of the change of use from the landowner or his or her agent, or within 18 months of the date the local assessing officials actually discover that the land use change tax is due and payable.

RSA 79-A:7, II(c). Read as a whole, the complaint raises a question of law bearing upon the legality of the LUCT assessments: the interpretation of RSA 79-A:7, II to determine whether the change in use date or some other operative date triggers the beginning of the 18-month period in which a municipality has the authority to mail a LUCT assessment. This court has not had occasion to directly address this statutory interpretation question. Cf. Maplevale Builders

v. Town of Danville, 165 N.H. 99, 106 (2013) (vacating abatement order and remanding for determination of change in use date and whether, based on that date, LUCT bills were timely, thereby implying that change in use date is relevant to determination of whether LUCT bills were timely issued under RSA 79-A:7, II) (decided under prior version of RSA 79-A:7). Because the complaint presents a question of law — the interpretation of RSA 79-A:7, II — regarding the timeliness and legality of the Town's LUCT assessments, we conclude that McMaster was not required to appeal the Town's neglect to decide its abatement request in compliance with RSA 79- A:10, III and that the trial court erred when it dismissed this suit based on McMaster's failure to do so. See Pheasant Lane, 143 N.H. at 141-42; Porter,

153 N.H. at 178. Accordingly, we reverse the trial court's grant of the Town's

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motion to dismiss the complaint and remand for further proceedings consistent with this order.

Reversed and remanded.

DONOVAN, COUNTWAY, and GOULD, JJ., concurred; MACDONALD, C.J., did not participate in the final vote.

Timothy A. Gudas, Clerk