2004 Minnesota Statutes

     270.276 Civil damages for certain unauthorized 
  collection actions. 

    Subdivision 1.    In general.  If in connection with the 
 collection of previously determined delinquent taxes from a 
 taxpayer of a state tax administered by the commissioner of 
 revenue, an employee of the department recklessly or 
 intentionally disregards a state tax law or rule, the taxpayer 
 may bring a civil action for damages against the commissioner in 
 district court within two years after the date the right of 
 action accrues. 

    Subd. 2.    Damages.  On a finding of liability on the 
 part of the defendant in an action brought under subdivision 1, 
 the defendant is liable to the plaintiff in an amount equal to 
 the lesser of $200,000, or the sum of (1) actual, direct 
 economic damages sustained by the plaintiff as a proximate 
 result of the reckless or intentional actions of the employee 
 and (2) the costs of the action.  Damages must be paid in 
 accordance with section 3.736, subdivision 7. 

    Subd. 3.    Limitations.  A judgment for damages must 
 not be awarded under subdivision 2 unless the court determines 
 that the plaintiff has exhausted the administrative remedies 
 available to the plaintiff within the department.  Damages 
 awarded must be reduced by the amount of the damages that could 
 reasonably have been mitigated by the plaintiff. 

    Subd. 4.    Penalties for procedures instituted primarily 
 for delay.  When it appears to the district court that: 

    (1) proceedings before it under this section have been 
 instituted or maintained by the taxpayer primarily for delay; 

    (2) the taxpayer's position in such proceeding is frivolous 
 or groundless; or 

    (3) the taxpayer unreasonably failed to pursue available 
 administrative remedies, 

 the district court, in its decision, may require the taxpayer to 
 pay to the department of revenue a penalty not in excess of 
 $25,000.  The penalty may be assessed and, upon notice and 
 demand, may be collected in the same manner as a tax. 

    HIST: 1990 c 604 art 1 s 9; 1997 c 84 art 6 s 10