Stipulated Facts Bring De Novo Review

 Where the circuit court received only arguments on a stipulated factual record, the appeals court gave the circuit court’s judgment “no presumption of correctness,” and so reviewed that judgment under a de novo standard. Ex parte Ala. Dept. of Revenue, No. 1070925 (Ala. Feb. 26, 2010).

 The taxpayer appealed a decision of the administrative law judge (ALJ) to the circuit court. In doing so, the parties — the taxpayer and the Alabama Department of Revenue — stipulated to the factual record and the transcript made before the ALJ. The circuit court reversed the ALJ, and the case found its way through the Court of Civil Appeals to the Supreme Court, which took the case on certiorari.

The state’s high court confirmed that a de novo standard applied to the circuit court’s judgment. The facts here were undisputed; indeed, the parties had stipulated to them in the circuit court. As a result, the case’s “controlling question” — the tax status of a certain transaction — was not a point of disputed fact. Rather, it was a dispute over how the tax law should be applied to the “undisputed” facts “and, accordingly, the conclusions to be drawn from the facts.” This elicited de novo review:

When reviewing a case in which the trial court sat without a jury and heard evidence in the form of stipulations, briefs, and the writings of the parties, this Court sits in judgment of the evidence; there is no presumption of correctness. When this Court must determine if the trial court misapplied the law to the undisputed facts, the standard of review is de novo, and no presumption of correctness is given the decision of the trial court.

(Citations omitted).

The court then addressed the merits of the case.