Department of Revenue v. Kuhnlein

• Decision Date: 29 September 1994
• Docket Number: Nos. 82994,82995,s. 82994
• Parties: , 19 Fla. L. Weekly S467 DEPARTMENT OF REVENUE, et al., Appellants/Cross-Appellees, v. David KUHNLEIN, et al., Appellees/Cross-Appellants. DEPARTMENT OF HIGHWAY SAFETY AND MOTOR VEHICLES, et al., Appellants/Cross-Appellees, v. Richard ADAMS, et al., Appellees/Cross-Appellants.
• Court: Florida Supreme Court

Page 717

646 So.2d 717

63 USLW 2271, 19 Fla. L. Weekly S467

DEPARTMENT OF REVENUE, et al., Appellants/Cross-Appellees, v. David KUHNLEIN, et al., Appellees/Cross-Appellants.

DEPARTMENT OF HIGHWAY SAFETY AND MOTOR VEHICLES, et al., Appellants/Cross-Appellees, v. Richard ADAMS, et al., Appellees/Cross-Appellants.

Nos. 82994, 82995.

Supreme Court of Florida.

Sept. 29, 1994.

Order Granting One Motion for

Clarification but Denying other

Motion Nov. 30, 1994.

Robert A. Butterworth, Atty. Gen., and Eric J. Taylor and Harry F. Chiles, Asst. Attys. Gen., Tallahassee, for appellants, cross-appellees.

Christopher K. Kay and Michael J. Beaudine, Foley & Lardner, Orlando, and Kimball R. Anderson, W. Gordon Dobie and Bruce R. Braun, Winston & Strawn, Chicago, IL on behalf of David Kuhnlein, et al.

James K. Green, James K. Green, P.A., West Palm Beach, and Robert W. Smith, Orlando, Cooperating Attys., for American Civ. Liberties Union Foundation of Florida, Inc., on behalf of Richard Adams and Balance Chow.

James M. Ervin, Jr. and John M. Gillies, Holland & Knight, Tallahassee, and Jeffrey S. Sutton, Jones, Day, Reavis & Pogue, Columbus, OH, amicus curiae, for R.R. Donnelly & Sons Co.

KOGAN, Justice.

We have for review a question certified by the Fifth District Court of Appeal to be of great public importance, requiring immediate resolution by this Court. We have jurisdiction. Art. V, Sec. 3(b)(5), Fla. Const.

In 1990, the Florida Legislature passed an act imposing a $295 impact fee on cars purchased or titled in other states that then are registered in Florida by persons having or establishing permanent residency here. As later amended, credit was given to the extent that the registrant paid Florida sales and use taxes, though no credit is given for any out-of-state taxes paid on the same vehicle. The fee is not imposed upon tourists or temporary visitors to Florida, nor upon used cars imported from out-of-state that are sold by Florida dealers. ¹

Two separate groups later filed suit. The first group consisted of a certified class of plaintiffs who sued for declaratory judgment on grounds that the tax violated guarantees of the United States Constitution, including the Commerce Clause. The Florida Department of Revenue ("DOR") and the other State parties contend that several members of the class were legally required to pay the impact fee but have submitted no proof that they actually paid it. The State also argues that none of the class plaintiffs have applied for a refund, which allegedly would trigger circuit court jurisdiction under sections 26.012(2)(e) and 215.26, Florida Statutes (1993). Some of the plaintiffs dispute these claims.

The other group of plaintiffs filed an action arguing that the impact fee violated their civil rights. They sought relief under 42 U.S.C. Sec. 1983. The State contended that Section 1983 was not an appropriate vehicle for challenging a state tax matter.

The trial court consolidated the various cases. The trial court later entered final summary judgment finding section 319.231 unconstitutional under the Commerce Clause of the United States Constitution and ordering an immediate refund. It also ruled that a taxpayer could bring a Section 1983 action in state court in a tax matter. The trial court denied the Civil Rights Plaintiffs' claim that the statute violated the right to travel.

Initially, the State argues that various plaintiffs below lacked standing to pursue this case because they either have not paid the fee or have not requested a refund of any fee paid. We note that the trial court rejected the State's factual contentions with respect to some appellants, and the record adequately supports the judge's findings. We also do not believe there is any requirement that the plaintiff must pay the fee or request a refund, at least in the present case. The fact that these plaintiffs face penalties for failure to pay an allegedly unconstitutional tax is sufficient to create standing under Florida law.

Unlike the federal courts, Florida's circuit courts are tribunals of plenary jurisdiction. Art. V, Sec. 5, Fla. Const. They have authority over any matter not expressly denied them by the constitution or applicable statutes. Accordingly, the doctrine of standing certainly exists in Florida, but not in the rigid sense employed in the federal system. We thus are not persuaded by the federal standing cases cited by the State.

We do agree that, except as otherwise required by the constitution, Florida recognizes a general standing requirement in the sense that every case must involve a real controversy as to the issue or issues presented. See Interlachen Lakes Estates, Inc. v In the context of declaratory judgment actions, we have reiterated much the same rule:

Brooks, 341 So.2d 993 (Fla.1976). Put another way, the parties must not be requesting an advisory opinion, id., except in those rare instances in which advisory opinions are authorized by the Constitution. E.g., art. IV, Sec. 1(c), Fla. Const. (advisory opinions to Governor).

Before any proceeding for declaratory relief should be entertained it should be clearly made to appear that there is a bona fide, actual, present practical need for the declaration; that the declaration should deal with a present, ascertained or ascertainable state of facts or present controversy as to a state of facts; that some immunity, power, privilege or right of the complaining party is dependent upon the facts or the law applicable to the facts; that there is some person or persons who have, or reasonably may have an actual, present, adverse and antagonistic interest in the subject matter, either in fact or law; that the antagonistic and adverse interests are all before the court by proper process or class representation and that the relief sought is not merely the giving of legal advice by the courts or the answer to questions propounded from curiosity. These elements are necessary in order to maintain the status of the proceeding as being judicial in nature and therefore within the constitutional powers of the courts.

May v. Holley, 59 So.2d 636, 639 (Fla.1952), reaffirmed by, Martinez v. Scanlan, 582 So.2d 1167, 1170 (Fla.1991).

The State here argues that the instant case does not meet the May requirements. We disagree. This Court accepted jurisdiction in Martinez (relying on May ) to resolve a dispute between various groups and the Governor over the validity of workers' compensation laws, even though the case arguably came close to being a request for an advisory opinion. Id. at 1170-71. It is true that no party disputed standing there, but this Court still refused to decline jurisdiction sua sponte, because of the importance of the issue. Id. at 1171.

We find that the present case does involve an actual controversy that is directly affecting, or can directly affect, the lives of many Florida residents. This is so because the law in question here requires certain residents either to pay an allegedly illegal tax or risk being penalized by the State. In sum, the controversy here is certainly greater than the one that existed in Martinez. Accordingly, standing existed for the plaintiffs below to bring this action for declaratory judgment.

The State next argues that the cause below was barred by the state's sovereign immunity, by an alleged common law rule that no one is entitled to the refund of an illegal tax, and by the requirements of Florida's refund statutes. Even if true, these are not proper reasons to bar a claim based on constitutional concerns. Sovereign immunity does not exempt the State from a challenge based on violation of the federal or state constitutions, because any other rule self-evidently would make constitutional law subservient to the State's will. Moreover, neither the common law nor a state statute can supersede a provision of the federal or state constitutions.

We also are unpersuaded by the State's claim that a refund claim cannot be cast as a class action. Any constitutional claim affecting a class of persons can be the proper subject of a class action, provided other procedural requirements are met, as they were here.

On the merits, we first address the Commerce Clause issue. The United States Constitution provides that "Congress shall have Power ... To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes." U.S. Const. art. I, Sec. 8. Justice Clarence Thomas recently explained how the Commerce Clause acts as a restriction on certain kinds of state actions:

Though phrased as a grant of regulatory power to Congress, the Clause has long been understood to have a "negative" aspect that denies the States the power unjustifiably to discriminate against or burden the interstate flow of articles of commerce.

Oregon Waste Systems, Inc. v. Department of Environmental Quality, --- U.S. ----, ----, 114 S.Ct. 1345, 1349, 128 L.Ed.2d 13 (1994). In deciding whether the Clause has been violated, the reviewing court first must determine whether the state action regulates even-handedly or imposes actual discrimination against interstate commerce. Id. "Discrimination" in this context means

differential treatment of in-state and out-of-state economic interests that benefits the former and burdens the latter.

Id. at ----, 114 S.Ct. at 1350. Discrimination exists when a state law taxes a transaction more heavily when it crosses state lines than when it occurs entirely within the state. Id.

If actual discrimination is present, the state action is "virtually per se invalid." Id. The State in question can defeat the presumption of invalidity only by showing that the statute advances a legitimate local purpose that cannot be adequately served by reasonable nondiscriminatory means. Id. at ----, 114 S.Ct. at 1351.

On the question of discrimination, the class plaintiffs rely in part on the effect the impact fee will have on interstate commerce in used automobiles. They have argued...