Justia California Court of Appeals Opinion Summaries

When parties discharge waste that could affect the quality of California’s water they must pay a permit fee set by the State Water Resources Control Board, Wat. Code, 13260. In 2011, two of the five Board seats were vacant; two of the remaining three members approved an increase of fees for the 2011-2012 fiscal year. CBI argued that section 183 required the fees to be approved by a majority of the five-person Board and that the increase was an illegal tax because the fee imposed on the dischargers in the storm water program (one of eight areas in the permit program) exceeded the cost of regulating this particular program. The court of appeal upheld the fee; section 181, not section 183, applied to adoption of the fee schedule and the vote by a majority of the Board’s quorum complied with section 181. Section 13260 requires that the total fees collected from all waste dischargers must equal the costs of regulating the entire waste discharge permit program. View "Cal. Bldg. Indus. Ass'n v. State Water Res. Control Bd." on Justia Law

Great Oaks, a water retailer, challenged a fee imposed on water it draws from wells on its property. The power to impose such a fee is vested in the Santa Clara Valley Water Management District under the Santa Clara County Water District Act, to prevent depletion of the acquifers from which Great Oaks extracts water. The trial court awarded a refund of charges paid by Great Oaks, finding that the charge violated the provisions of the District Act and Article XIII D of the California Constitution, which imposes procedural and substantive constraints on fees and charges imposed by local public entities. The court of appeal reversed, finding that: the fee is a property-related charge for purposes of Article 13D and subject to some of the constraints of that enactment; it is also a charge for water service, and, therefore, exempt from the requirement of voter ratification; pre-suit claims submitted by Great Oaks did not preserve any monetary remedy against the District for violations of Article 13D; and the court failed to apply a properly deferential standard of review to the question whether the District’s setting of the fee, or its use of the resulting proceeds, complied with the District Act. View "Great Oaks Water Co. v. Santa Clara Valley Water Dist." on Justia Law

An individual and a hotel who incurred a one percent surcharge on their electricity bills, collected by Southern California Edison (SCE) and remitted to the City of Santa Barbara, filed a class action challenging its validity. The city did not seek voter approval of the surcharge, which is collected pursuant to an ordinance and franchise agreement with the city. The California Constitution, as amended by Proposition 218, prohibits local governments from imposing new or increased taxes without first obtaining voter consent. (Cal. Const., art. XIII C, 2.) The court of appeal reversed the trial court. The surcharge is an illegal tax masquerading as a franchise fee. Distinguishable precedent cited by the city concerned traditional franchise fees collected for grants of rights of way rather than, as here, a surcharge collected for general revenue purposes. View "Jacks v. City of Santa Barbara" on Justia Law

The parties did not dispute the facts of the various transactions in this case, only the legal conclusions to be drawn from them. At the center, this case concerned the County of Orange’s property tax reassessment of a retail shopping center located in the City of Westminster. The Assessment Appeals Board and the trial court both concluded reassessment was proper because there was a change of ownership of the subject property when it was purchased by the long-term lessee and a third party investor. After review, the Court of Appeal concluded there was no change of ownership for property tax purposes and reversed the trial court’s judgment. View "Dyanlyn Two v. County of Orange" on Justia Law

The prior owners were unable to pay the property taxes on the shopping center beginning in 2010. When petitioner purchased the property, taxes assessed for fiscal years 2010-2011, 2011-2012, and 2012-2013 were delinquent, totaling $568,627.94. Petitioner requested that the tax collector cancel penalties. Revenue and Taxation Code section 4985.2(a) provides that a penalty resulting from failure to make a timely property tax payment may be canceled if the failure “is due to reasonable cause and circumstances beyond the taxpayer’s control ... notwithstanding the exercise of ordinary care in the absence of willful neglect, provided the principal payment for the proper amount of the tax due is made.” The tax collector determined only $2,670.10 of the $142,521.68 in penalties should be waived, because the statement for the second installment of taxes due in the 2012-2013 fiscal year had been mailed to the previous owners’ address. The trial court dismissed the owner’s suit, concluding that writ of mandate was not the appropriate remedy and payment of the tax was a prerequisite to cancellation of penalties and the taxes had not been paid. The court of appeal affirmed. View "Ashlan Park Center, LLC v. Crow" on Justia Law

The law firm challenged the validity and scope of Proposition Q, which amended the Payroll Expense Tax Ordinance of the City and County of San Francisco (San Francisco Bus. & Tax Reg. Code, article 12-A, 901). Plaintiff paid the payroll expense tax calculated under Proposition Q, and the city rejected its Administrative claim. The firm sought a refund of that portion of the tax that it paid on the profits distributed to its equity partners. The court of appeal dismissed an appeal, ruling that some portion of the firm’s profit distributions to its equity partners represents “compensation for services,” to be included in the payroll expense tax base and that Proposition Q does not violate either article XIIIC of the California Constitution. View "Coblentz, Patch, Duffy & Bass, LLP v. City & Co. of San Francisco" on Justia Law

The Fresno County Assessor audited the partnership regarding personal property for tax years 1994-2001, which resulted in assessment of additional taxes for farm equipment. In 2007, the partnership attempted to apply for changed assessment to cancel the assessment under Revenue and Taxation Code section 4986 on the ground that it did not own that personal property. The Assessment Appeals Board returned the applications as untimely. In 2010, the partnership sought a declaratory judgment that the subject properties did not exist and the assessments should be cancelled. The trial court dismissed on the ground that it was seeking to enjoin the collection of property taxes in violation of the California Constitution. The court concluded that the partnership was required to first pay the tax and then seek a refund. By checks in 2011-2012, the partnership paid the disputed taxes in full, with penalties and interest. The partnership’s refund claims were rejected, so it filed suit. The trial court concluded that the partnership was required to seek reduction of the assessment and that the action was barred for failure to do so. The court of appeal reversed, noting the partnership’s argument that it did not own the assessed property on the applicable dates, so that the assessments were “nullities.” View "Williams & Fickett v. Cnty. of Fresno" on Justia Law

The State Board of Equalization (SBE) interprets the Uniform Local Sales and Use Tax Law 7200 and the California Sales and Use Tax Law 6001 so that retail sales of tangible personal property stored, used, or consumed in California are subject to state sales tax when a California business is involved in the sale and title passes to the customer in California. If these conditions are not satisfied, the sale is subject to a use tax. Sales subject to state sales tax are subject to local sales tax; if state use tax applies, local use tax applies. Local sales tax revenue goes to the city where the sale was consummated while local use tax revenue is distributed out of a countywide pool. The city in which the sale was transacted usually receives less when use tax is imposed. Cities sued, claiming that all sales negotiated in a business in their city should be subject to local sales tax, even when the item is shipped from out of state to the consumer and the transaction is, therefore, subject to state use tax. The trial court agreed with the cities, but denied retroactive relief. The court of appeal reversed, in favor of SBE’s use of the Uniform Commercial Code to determine when title passed. View "So. San Francisco v. Bd. of Equalization" on Justia Law

Serban worked as a massage therapist at Voda Spa. Serban and Voda Spa disagree as to why he left that work, but the trial court found Serban had good cause to leave and that finding was not challenged. They also disputed whether Serban was an employee or independent contractor. The California Unemployment Insurance Appeals Board found that he was an employee, not an independent contractor, and the trial court agreed with the Board that its decision was not subject to judicial review because both the California Constitution and the Unemployment Insurance Code bar actions whose purpose is to prevent the collection of state taxes. The court of appeal reversed, agreeing that the case does not challenge the imposition of a tax.View "W. Hollywood Cmty. Health & Fitness Ctr. v. CA Unemp. Ins. Appeals Bd." on Justia Law

In this tax refund case, Chevron challenged the method by which the Kern County Assessor and Assessment Appeals Board valued oil and gas wells as new construction during three tax years, Rev. & Tax. Code, 5140 et seq. The trial court found that the Board used the wrong valuation method and remanded. Both parties appealed. The court concluded that Chevron has standing to maintain this action; concluded that the Board did not abuse its discretion or act contrary to law when it approved the assessor's valuation method; rejected Chevron's exemption argument; and reversed in part, affirming in part.View "Chevron USA v. County of Kern" on Justia Law