American Trucking Associations, Inc. v. Conway

• Decision Date: 21 February 1986
• Docket Number: No. 83-484,83-484
• Parties: AMERICAN TRUCKING ASSOCIATIONS, INC., Chemical Leaman Tank Line, Inc. and Anderson Trucking Service, Individually and on Behalf of All Others Similarly Situated v. William CONWAY, Commissioner of Motor Vehicles; Paul Philbrook, Vermont Commissioner of Public Safety; Richard Snelling, Governor of State of Vermont and Thomas Evslin, Secretary of Vermont Agency of Transportation.
• Court: Vermont Supreme Court

Page 408

508 A.2d 408

146 Vt. 579

AMERICAN TRUCKING ASSOCIATIONS, INC., Chemical Leaman Tank

Line, Inc. and Anderson Trucking Service,

Individually and on Behalf of All Others

Similarly Situated v. William CONWAY, Commissioner of Motor Vehicles; Paul

Philbrook, Vermont Commissioner of Public Safety; Richard

Snelling, Governor of State of Vermont and Thomas Evslin,

Secretary of Vermont Agency of Transportation.

No. 83-484.

Supreme Court of Vermont.

Feb. 21, 1986.

Ralph A. Foote, Robert H. Moyer, and Charles Starbuck of Conley and Foote, Middlebury, for plaintiffs-appellees.

John J. Easton, Jr., Atty. Gen., and Zander B. Rubin and Robert C. Schwartz, Asst. Attys. Gen., Montpelier, for defendants-appellants.

Before ALLEN, C.J., and HILL, UNDERWOOD, PECK and GIBSON, JJ.

PECK, Justice.

The defendants appeal an order of the Washington Superior Court declaring unconstitutional statutes imposing fuel user license fees, 23 V.S.A. §§ 415, 3007, and trip permit fees or temporary authorization fees, 23 V.S.A. § 3010, on foreign-registered trucks. The lower court found that these statutes, challenged by plaintiffs in a class action, ¹ violated the Commerce Clause of the United States Constitution by discriminating against interstate commerce. The court held the statutes unconstitutional because under the statutory scheme foreign truck owners or operators must pay certain fees which are not offset by complementary domestic or foreign taxes on Vermont-registered trucks.

Defendants appeal, alleging, first, that the trial court sitting in equity and consisting of a presiding judge and an assistant judge, had no jurisdiction to hear the case; and second, the fees imposed pursuant to the challenged statutes do not violate the Commerce Clause of the United States Constitution. We disagree and affirm the trial court's decision.

The plaintiffs also appeal the lower court's order denying plaintiffs' motion for a court-ordered refund of any fees, fines or penalties collected pursuant to the objectionable statutes. We affirm the denial of a refund.

In 1982 this Court considered another challenge to the constitutionality of certain fees imposed by Vermont on foreign-registered trucks. American Trucking Associations, Inc. v. Conway, 142 Vt. 17, 451 A.2d 42 (1982). There the plaintiff class challenged a fee system imposed by 23 V.S.A. §§ 415-419 (Cum.Supp.1982) (Act 87). ²

In the earlier case, this Court vacated the judgment of the lower court, which had upheld the fee system imposed under Act 87, and remanded for further factual findings. Id. at 23, 451 A.2d at 45. During the pendency of the appeal of that case, American Trucking Associations, Inc., supra, the Vermont legislature amended the fee system for foreign trucks by 1981, No. 172 (Adj.Sess.), now codified at 23 V.S.A. §§ 415-423 (Cum.Supp.1982) (Act 172). American Trucking, supra, 142 Vt. at 19, 451 A.2d at 43. In this case, we consider the validity of the fee system imposed under Act 172.

Act 172 provides that owners or operators of trucks weighing 18,000 pounds or more, and operated on Vermont highways, whether registered in the state or not, must either: (1) pay a $50.00 annual fuel user's license fee, 23 V.S.A. §§ 415, 3007; (2) acquire a "single trip permit," costing $50.00, 23 V.S.A. § 3010(a); or, (3) acquire a "temporary authorization" costing $50.00, 23 V.S.A. § 3010(b). There is no dispute that each of the above-mentioned statutes would produce the same effect--owners or operators of trucks weighing 18,000 or more must pay $50.00 to use Vermont highways. For the purposes of this opinion, any reference to the "$50.00 user fee" is a reference to all three of the challenged statutes, 23 V.S.A. §§ 415, 3007 and 3010(a), (b). In an amendment to the motor vehicle registration provision, Act 172 reduced by $50.00 the annual registration fee owed by owners of Vermont-registered trucks weighing 18,000 pounds or more. 23 V.S.A. § 367.

Plaintiffs sought declaratory and injunctive relief, contending that the fees imposed, under Act 172, on out-of-state trucks constituted an unlawful burden on interstate commerce and otherwise violated their rights under the Commerce Clause of the United States Constitution, the Supremacy Clause of the United States Constitution, the Revised Interstate Commerce Act, 49 U.S.C. § 10101 et seq., the Fourteenth and Fifth Amendments to the United States Constitution, the Privileges and Immunities Clause of the United States Constitution, and Article 9 of Chapter I of the Vermont Constitution. In addition to the request for injunctive and declaratory relief, plaintiffs sought repayment by the state of any fees collected pursuant to the challenged statutes.

When it considered the challenged statutes in conjunction with the registration fee refund of $50.00 which benefited only Vermont-registered trucks, 23 V.S.A. *411s 367, the trial court ruled that the statutes, 23 V.S.A. §§ 415, 3007 and 3010, all violated the Commerce Clause of the United States Constitution. However, the lower court neither discussed nor decided plaintiffs' other claims. In a motion to alter judgment, plaintiffs requested that the fees already collected under Act 172 be refunded. The court denied the motion. Defendants filed a timely appeal of the court's order declaring the statutes unconstitutional, while plaintiffs appealed the court's order denying them monetary relief.

I.

Defendants' first claim on appeal is that the judgment is void for lack of jurisdiction, given the presence of an assistant judge during the adjudication of equitable matters. Under Soucy v. Soucy Motors, Inc., 143 Vt. 615, 620, 471 A.2d 224, 227 (1983), this fact would require reversal. In Solomon v. Atlantis Development, Inc., 145 Vt. 70, 74-76, 483 A.2d 253, 256-57 (1984), however, we held that Soucy will be applied prospectively only. Because the court decided this case prior to December 12, 1983, the date Soucy was issued, this case is not subject to reversal under Soucy.

Nevertheless, under our law prior to Soucy, the presence of assistant judges in cases in equity could require reversal. See Maskell v. Beaulieu, 140 Vt. 75, 435 A.2d 699 (1981); Pockette v. LaDuke, 139 Vt. 625, 432 A.2d 1191 (1981). Here, however, the case was decided on stipulated facts, so there was no hearing and no fact-finding by the assistant judge. In Brower v. Holmes Transportation, Inc., 140 Vt. 114, 435 A.2d 952 (1981), we determined that the assistant judges' presence did not constitute an improper influence "where only a legal ruling as to summary judgment is involved." Id. at 118, 435 A.2d at 954. Therefore, the unanimous decision based upon stipulated facts submitted without a hearing does not require reversal under pre-Soucy law.

II.

Next we consider defendants' claim that the trial court erred when it ruled the challenged statutes unconstitutional under the Commerce Clause of the United States Constitution.

Initially, we must consider defendants' contention that the lower court improperly applied the test of Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 97 S.Ct. 1076, 51 L.Ed.2d 326 (1977). Defendants contend that Complete Auto's test only applies to Commerce Clause challenges to statutes which impose taxes on the privilege of doing business in the state, not "use" taxes. The proper test in our case, according to defendants, is the one employed in the pre-Complete Auto line of cases known as "flat fee" cases. See, e.g., Capitol Greyhound Lines v. Brice, 339 U.S. 542, 70 S.Ct. 806, 94 L.Ed. 1053 (1950); Aero Mayflower Transit Co. v. Board of Railroad Commissioners, 332 U.S. 495, 68 S.Ct. 167, 92 L.Ed. 99 (1947); Aero Mayflower Transit Co. v. Georgia Public Service Commission, 295 U.S. 285, 55 S.Ct. 709, 79 L.Ed. 1439 (1935). The third prong of the Complete Auto test--whether the tax discriminates against interstate commerce--is also an element of the test employed in the flat fee cases. See, e.g., Aero Mayflower Transit Co., supra, 332 U.S. at 501-03, 68 S.Ct. at 170-71. The challenged components of Act 172 fail to survive scrutiny under this "discrimination" element or prong; therefore, it does not matter which test is applied.

The trial court ruled that the challenged statutes, 23 V.S.A. §§ 415, 3007 and 3010, violated the Commerce Clause of the United States Constitution, in part, because the tax discriminates against interstate commerce. The United States Supreme Court has ruled that a state tax is not per se invalid because it burdens interstate commerce as interstate commerce may be made to pay its way. Maryland v. Louisiana, 451 U.S. 725, 754, 101 S.Ct. 2114, 2133, 68 L.Ed.2d 576 (1981). Nevertheless [o]ne of the fundamental principles of Commerce Clause jurisprudence is that no State, consistent with the Commerce Clause, may "impose a tax which discriminates against interstate commerce ... by providing a direct commercial advantage to local business." Northwestern States Portland Cement Co. v. Minnesota, 358 U.S. 450, 458 [79 S.Ct. 357, 362, 3 L.Ed.2d 421] (1959). See Boston Stock Exchange v. State Tax Comm'n, 429 U.S. 318, 329 [97 S.Ct. 599, 607, 50 L.Ed.2d 514] (1977). This antidiscrimination principle "follows inexorably from the basic purpose of the Clause" to prohibit the multiplication of preferential trade areas destructive of the free commerce anticipated by the Constitution. Boston Stock Exchange, supra. See Dean Milk Co. v. Madison, 340 U.S. 349, 356 [71 S.Ct. 295, 298, 95 L.Ed. 329] (1951).

Id. at 754, 101 S.Ct. at 2133. The challenged provisions of Act 172 discriminate against interstate commerce by providing a direct commercial advantage to Vermont truckers. See Westinghouse Electric Corp. v. Tully, 466 U.S. 388, 402-07, 104 S.Ct. 1856, 1865-68, 80 L.Ed.2d 388 (1984). The trial court noted that, in considering the user fee requirements of the Act, it could not "but be aware of the consequences of the most recent amendments to the licensing and registration statut...