Heard: November 7, 2017.
from a decision of the Appellate Tax Board.
Supreme Judicial Court on its own initiative transferred the
case from the Appeals Court.
D. Rapacki for the intervener. John A. Shope (Michael Hoven
also present) for the taxpayers.
J. Hammond, Assistant Attorney General (Daniel A. Shapiro
also present) for Commissioner of Revenue.
Robbins & Martin J. Newhouse, for New England Legal
Foundation, amicus curiae, submitted a brief.
Present: Gants, C.J., Gaziano, Lowy, Budd, Cypher, &
years and three Supreme Judicial Court decisions ago, this
protracted case commenced regarding taxes imposed on computer
service contracts. The litigation began when purchasers of
the service contracts filed a putative class action against
the sellers,  claiming under G. L. c. 93A that the
imposition of these taxes was unlawful and an unfair and
deceptive practice. The sellers successfully moved to compel
arbitration pursuant to the terms of the computer service
contracts, and a judge in the Superior Court eventually
confirmed the award. The next chapter in this tax saga, and
the one we are required to decide today, then ensued.
sole and express purpose of hedging their bets in response to
the class action, the sellers had applied for tax abatements
from the Commissioner of Revenue (commissioner) beginning in
2004. The commissioner denied the applications, and the
sellers petitioned the Appellate Tax Board (board). The
appellant, Econo-Tennis Management Corp., doing business as
Dedham Health and Athletic Complex (Dedham Health), one of
the consumers who purchased these service contracts, moved to
intervene in the proceedings, which the board allowed.
Thereafter, the board, with certain exceptions, reversed the
decision of the commissioner and allowed the abatements,
ordering the parties to compute the amounts to be abated.
Taxes totaling $215.55 were imposed on the service contracts
purchased by Dedham Health. After the class action
litigation on the claims under G. L. c. 93A ended in the
sellers' favor, the sellers withdrew their tax abatement
petitions with prejudice. Dedham Health moved to strike the
withdrawals. The board denied the motion to strike the
withdrawals and terminated the proceedings, deciding that
"any pending or further motions . . . [were] moot"
and that it would "take no further action on these
appeals." Dedham Health now appeals from that order. We
transferred Dedham Health's appeal to this court on our
motion and now conclude that although the board did not err
as a matter of law in allowing the sellers' withdrawals,
the board's termination of the proceedings in their
entirety, after permitting Dedham Health to intervene and
allowing the abatements, was an error of law. After the
sellers' withdrawals were allowed, Dedham Health should
have been allowed to proceed as an intervener on its own
claim to recover the taxes imposed on the service contracts
instant cases arise out of the same tax dispute at issue in
Feeney v. Dell Inc., 454 Mass. 192 (2009)
(Feeney I); Feeney v. Dell Inc., 465 Mass.
470 (2013) (Feeney II); and Feeney v. Dell
Inc., 466 Mass. 1001 (2013) (Feeney III). As we
summarized in Feeney I, supra at 194,
"Dell Catalog Sales Limited Partnership (Dell Catalog)
and Dell Marketing Limited Partnership (Dell Marketing),
wholly owned subsidiaries of Dell Inc. (formerly Dell
Computer Corporation), sold computers and related products to
consumers and businesses and, in connection with such sales,
also sold optional computer hardware service contracts under
which [the sellers] agreed to provide onsite computer repairs
to the purchasers." Dell Catalog and Dell Marketing
collected tax on the optional service contracts from their
customers and remitted the tax to the Department of Revenue.
Id. at 194 & n.6. Under these service contracts,
"BancTech, Inc. . . .; QualxServ LLC; or Dell Marketing
agreed to provide onsite computer repairs to the
purchasers." Id. at 194. Dedham Health was
one such consumer who purchased Dell computer hardware and
the accompanying service contracts. Id. Dedham
Health asserted that the tax on the optional service
contracts was improper. Id. at 193.
Health and one other plaintiff who bought Dell hardware and
service contracts commenced a putative class action
against Dell Computer Corporation (Dell Computer) in 2003,
alleging that it had improperly collected and remitted tax on
the service contracts that the plaintiffs purchased, and that
collecting the tax violated the Massachusetts consumer
protection act, G. L. c. 93A. Ld. at 193, 196. "The
'Dell Terms and Conditions of Sale' ... in effect at
the time of the plaintiffs' purchases contain an
arbitration clause compelling arbitration of any claim
against Dell . . . and mandating that any such
claims be arbitrated on an individual basis" (emphasis
in original; footnote omitted) . Id. at 194-195.
In July, 2003, Dell Computer moved to compel arbitration, and
a judge in the Superior Court allowed the motion.
Id. at 196-197. "[The plaintiffs] each filed a
claim of arbitration 'under protest' in November,
2004." Id. at 197. The arbitrator denied the
plaintiffs' request for class certification, and ruled in
favor of the defendants on the merits in 2007. Id.
February 2008, the plaintiffs moved in the Superior Court to
vacate the arbitration award, " but their motion was
denied and the case was dismissed with prejudice.
Id. The plaintiffs appealed, and we granted their
application for direct appellate review. Id. In
Feeney I, this court held that the arbitration
clause was void as against public policy, and reinstated the
Superior Court action. Id. at 205, 214. Less than
two years later, the United States Supreme Court ruled in
AT&T Mobility LLC v. Concepcion, 563 U.S. 333,
351-352 (2011), that the Federal Arbitration Act precludes
invalidating class waiver provisions in arbitration clauses
on the basis of State public policy favoring class actions.
In response to Concepcion, we held in Feeney
II that "a court may still invalidate a class
waiver" post-Concepcion where, as here,
"class proceedings are the only viable way for a
consumer plaintiff to bring a claim against a
defendant." Feeney II, 465 Mass. at 501-502.
One week later, the United States Supreme Court held in
American Express Co. v. Italian Colors
Restaurant, 570 U.S. 228, 238-239 (2013)
(Amex), that an arbitration agreement's class
waiver is enforceable even if the class waiver effectively
precludes the plaintiff from vindicating his or her Federal
statutory rights. In light of the Supreme Court ruling in
Amex, we held in Feeney III that the class
waiver in the present case could not be invalidated for
effectively denying the plaintiffs a remedy, and remanded the
case to the Superior Court. Feeney III, 466 Mass. at
remand, the Superior Court granted the sellers' motion to
confirm the original arbitration award dismissing the
plaintiffs' claims. Feeney vs. Dell Inc., Mass.
Superior Ct., No. 2003-01158 (Middlesex County Oct. 24,
2013). The Appeals Court affirmed in a memorandum and order
pursuant to its rule 1:28, 87 Mass.App.Ct. 1137 (2015), and
this court denied the plaintiffs' application for further
appellate review in October, 2015, ending the putative class
the putative class action was still ongoing, the sellers
brought abatement claims against the commissioner for the
taxes collected on the service contracts. The sellers
indicated in their abatement filings that they only sought
abatement in the event that the class action litigation
resulted in a judgment requiring the sellers to refund the
taxes to their customers. The sellers' filings stated
that if they prevailed in the class action, they would
withdraw their abatement applications.
commissioner denied the sellers' abatement requests. The
sellers filed timely petitions with the board challenging the
commissioner's denial of their abatement requests, and
the petitions were consolidated. In their petitions to the
board, the sellers again emphasized that they sought
abatement to protect against a possible judgment against them
in the putative class action litigation.
Health filed motions to intervene in the sellers'
petitions before the board, arguing that it and "other
similarly situated customers" were the "real
parties in interest" because the customers were entitled
to be refunded in the amount of any abatement paid out to the
sellers. Dedham Health also asserted that the commissioner
prohibits customers from pursuing abatement claims themselves
"where the challenged 'tax' was paid to, and
remitted by, the seller." However, Dedham Health did not
ask for class action certification before the board because,
as it conceded in its motion, "there is no procedure for
certifying a class action to the [board]." The board
Health's motions to intervene, concluding that it had
alleged "sufficient facts ... to support its claims that
the parties may not be adequately representing Dedham
Health's interests" and that Dedham Health had
"a substantial interest in the subject matter of this
litigation." In allowing Dedham Health's
intervention, the board noted that it "in no way extends
or expands the limitations contained in G. L. c. 62C, §
37, " the statute that sets forth the procedure for
parties submitted a joint statement of facts and a joint
evidentiary record to the board. The board ruled in December,
2013, that, with certain exceptions, the transactions did not
fall within the statutory or regulatory framework for
taxation and thus the sellers had not been required to
collect the taxes at issue, and were therefore entitled to an
abatement of all such taxes they had remitted. The board
directed the parties to "compute the amounts to be
abated based on the foregoing findings and rulings."
Because computing the abatement amounts would be a complex
and expensive task, the board granted the sellers' motion
to stay the board proceedings until all appeals in the
putative class action litigation had been
the final dismissal of the putative class action in favor of
the sellers, the sellers withdrew all of their petitions
before the board. Dedham Health filed a motion to strike the
sellers' withdrawals, arguing that allowing the
withdrawals would leave consumers without a forum to pursue a
tax refund. In July, 2016, the board denied Dedham
Health's motion to strike. Instead, the board ordered the
proceedings closed in light of the sellers' withdrawals,
ruling that "any pending or further motions and
discovery are moot." The board's ruling did not
include a rationale for its decision. Dedham Health did not
request findings and a report, available pursuant to G. L. c.
58A, § 13.
appeal, Dedham Health argues that the board (1) improperly
denied Dedham Health's motion to strike the sellers'
withdrawals, (2) incorrectly ruled that the withdrawals
rendered all pending and future motions moot, and (3)
violated Dedham Health's right to due process ...