Wednesday, June 3, 2009

Class Claims For Utility Tax Refunds?

n Woosley v. State of California, 3 Cal. 4th 758 (1992), the Supreme Court held that, in view of the strong constitutional policy (expressed in Article XIII, Section 32) against granting injunctive relief to restrain the collection of taxes, a class claim to secure the refund of state taxes is impermissible unless expressly authorized by the Legislature. In Ardon v. City of Los Angeles (here), the Court of Appeal extended Woosley to a suit for refund of a local tax. Although the same court had previously reached the opposite result in County of Los Angeles v. Duperior Court, 159 Cal. App. 4th 353 (2008), this time the majority held that even though Article XIII, Section 32 applies of it own force only to state taxes, the policy it enunciates is broad enough to cover local taxes as well.

This seems like a strong candidate for Supreme Court review. The Courts of Appeal (indeed, even the same court) is split, and the issue is important. Stay tuned.

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