Branson v. Port of Seattle

Decision Date18 November 2004
Docket NumberNo. 73766-5.,73766-5.
Citation101 P.3d 67,152 Wn.2d 862,152 Wash.2d 862
PartiesDouglas M. BRANSON, individually and on behalf of all other similarly situated persons, Petitioner, v. PORT OF SEATTLE, Respondent, and CMC Investments, Inc. d/b/a Dollar Rent a Car; Rainier Leasing Corporation d/b/a Advantage Rent-A-Car; Pacific Northwest Rental and Leasing, Inc. d/b/a Thrifty Car Rental; and Enterprise Leasing Company d/b/a Enterprise Rent-A-Car, Defendants.
CourtWashington Supreme Court

Arthur Cary Claflin, Spencer Hall, W. Scott Zanzig, Hall Zanzig Claflin McEachern PLLC, Seattle, for Petitioner.

Phillip H. Ginsberg, Carl J. Marquardt, Paul M. Bintinger, Port of Seattle Legal Dept., Seattle, for Respondent.

Stephen Alan Smith, Preston Gates & Ellis LLP, Seattle, Thomas R. Devine, Palmer & Dodge, Washington DC, Patricia A. Hahn, Airport Council Int'l-North America, Washington DC, for Amicus Curiae (Airports Council International-North America).

BRIDGE, J.

Douglas Branson sued the Port of Seattle (Port), claiming that airport concession fees charged to rental car companies conducting business at Seattle Tacoma International Airport (Sea Tac) violate the 1945 Revised Airports Act (RAA), chapter 14.08 RCW. Specifically, he asserts that the concession fees deny the public equal and uniform use of airport property. He also contends that the concession fees are not uniform for the same class of service, they are unreasonable, and they were not established with due regard to the property used and the expense of airport operation. Branson seeks both declaratory relief and damages.

We conclude that the airport concession fees at issue in this case do not deny the public equal and uniform use of the airport because the fees in no way impact public use of airport property. We also conclude that because the airport fees at issue here are only those that the Port charges to concessionaires, Branson has not established that he has standing to challenge the reasonableness, uniformity, or basis for establishing the fees themselves. In addition, Branson has not shown that declaratory judgment in his favor would be appropriate given limitations imposed under the Uniform Declaratory Judgment Act (UDJA), chapter 7.24 RCW.

I Facts and Procedural History

The Port operates Sea Tac as a self-sustaining business unit of the Port. Sea Tac's largest source of revenue is its contract with the airlines. The second largest source of revenue is "landside or `ground access' operations," which include concessionaire contracts with rental car companies. Clerk's Papers (CP) at 819.

There is limited space for operation of rental car facilities at Sea Tac, so rental car companies must compete for space in a public bidding process. Five companies become full service providers, four become limited service providers, and the rest may become off-airport concessionaires. Full service providers rent both counter space in the airport building and airport garage space to park and maintain their cars. Limited service providers rent counter space in the terminal building but do not rent space in the airport parking garage, so their customers must take a shuttle to an off-site location to pick up a rental car. Off-airport rental car providers do not maintain either counter space or garage space at the airport; those providers pick up customers at the airport and drive them to another location to complete the car rental transaction. Only the limited service contracts are at issue in this case.

The limited service providers pay the airport a fixed rent for use of counter space at the airport, plus a concession fee of 10 percent of their gross airport revenues. In contrast, full service providers pay a higher rent for their more extensive use of airport property, along with 10 percent of their gross airport revenues. Off-airport rental car providers pay a fee of 4 percent of monthly airport revenues in excess of $40,000, plus a per trip charge for shuttle pickups.

Before 1998, the Port's contracts with rental car companies included a provision prohibiting the companies from separately adding fees to a customer's bill based on concession fees or any other airport charge. Therefore, before 1998, rental car bills did not include a line item attributing part of the customer's bill to airport fees. In 1997, Dollar Rent A Car objected to this provision on First Amendment grounds. The Port concluded that the company's objection was reasonable and has since included a provision in its rental car concession contracts stating that "[t]he Port does not require but will not prohibit this pass through of the Concession Fee to Airport Customers." CP at 1068, 822. The contracts also now include conditions for disclosing information about the pass through to customers.

Douglas Branson is a resident of Pennsylvania who regularly travels to Seattle. He rented cars from limited service rental car providers five times during the period of 1998-2000. On each occasion, his bill included a separate line item charge to cover the concession fee paid to Sea Tac.

Branson brought a class action lawsuit against the rental car companies and the Port, claiming that the concession fees charged by the Port violate the RAA's requirement that airport fees allow for uniform public use of airport property. See RCW 14.08.120(6). He also claimed that the Port's concession fees are not uniform, reasonable, or established with due regard to the property used and the expense of its operation. Finally, Branson argued that the rental car companies' practice of passing the fees through to customers violates the Consumer Protection Act (CPA), chapter 19.86 RCW. The parties stipulated to postpone class certification until the court ruled on summary judgment motions. The parties later stipulated to dismissal of the claims against the rental car companies. The trial court then granted the Port's motion for summary judgment, finding that the Port's 10 percent concession fee, charged to the rental car companies, is authorized by RCW 14.08.120 as a matter of law.

Branson appealed. The Court of Appeals affirmed, concluding that the Port's 10 percent concession fee complies with RCW 14.08.120(6), which provides that airport fees may not deny the public of equal and uniform use of airport property and requires that airport fees be reasonable and uniform for the same class of service. Branson v. Port of Seattle, 115 Wash.App. 695, 697, 63 P.3d 830 (2003).

II Analysis

On appeal from summary judgment, this court engages in the same inquiry as the trial court. Okeson v. City of Seattle, 150 Wash.2d 540, 548, 78 P.3d 1279 (2003). Summary judgment is appropriate if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Clark v. Baines, 150 Wash.2d 905, 910-11, 84 P.3d 245 (2004). This court reviews issues of statutory interpretation de novo. Okeson, 150 Wash.2d at 548, 78 P.3d 1279.

The RAA authorizes a municipality to raise funds for the operation of its airport. RCW 14.08.100(1). The act specifically authorizes municipalities:

[t]o determine the charges or rental for the use of any properties under its control and the charges for any services or accommodations, and the terms and conditions under which such properties may be used: PROVIDED, That in all cases the public is not deprived of its rightful, equal, and uniform use of the property. Charges shall be reasonable and uniform for the same class of service and established with due regard to the property and improvements used and the expense of operation to the municipality.

RCW 14.08.120(6) (emphasis added).1 Additionally, the legislature directed the courts to interpret the RAA "to make uniform so far as possible the laws and regulations of this state and other states and of the government of the United States having to do with the subject of aeronautics." RCW 14.08.340.

As an initial matter, Branson argues that any interpretation of the RAA depends in part upon whether the power to set concession fees is governmental or proprietary. Generally, a municipality acts in either a governmental or proprietary capacity. Okeson, 150 Wash.2d at 549, 78 P.3d 1279. The principal test for determining whether a function is governmental or proprietary is "whether the act performed is for the common good of all, or whether it is for the special benefit or profit of the corporate entity." Id. at 550, 78 P.3d 1279. If this court classifies a statutorily granted municipal power as proprietary, then the extent of that municipal power can be liberally construed. 2A Eugene McQuillin, The Law of Municipal Corporations § 10.22 at 378 (Dennis Jensen & Gail O'Gradney eds., 3d ed. rev. vol.1996). If a municipal function is governmental in nature, then "less opportunity exists for invoking the doctrines of liberal construction and of implied powers." City of Tacoma v. Taxpayers of City of Tacoma, 108 Wash.2d 679, 694, 743 P.2d 793 (1987).

The acts of setting airport fees and entering into contracts are generally considered to be proprietary functions. See, e.g., Hite v. Pub. Util. Dist. No. 2, 112 Wash.2d 456, 460, 772 P.2d 481 (1989)

; Alamo Rent-A-Car, Inc., v. Bd. of Supervisors, 221 Cal.App.3d 198, 205, 272 Cal.Rptr. 19 (1990); Jacksonville Port Auth. v. Alamo Rent-A-Car, Inc., 600 So.2d 1159, 1164 (Fla. 1st DCA 1992). However, the specific powers granted in the RAA have been declared by the legislature to be governmental in nature. RCW 14.08.020 ("the ... operation of airports and other air navigation facilities, and the exercise of any other powers herein granted to municipalities, are hereby declared to be public, governmental, county and municipal functions, exercised for a public purpose"). While governmental powers may not be liberally construed, City of Tacoma,

108 Wash.2d at 694,

743 P.2d 793, the RAA authorizes the municipality to exercise all powers necessarily...

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