Faix, Ltd. v. County of Los Angeles

• Decision Date: 29 January 1976
• Court: California Court of Appeals Court of Appeals
• Parties: FAIX, LTD., Plaintiff and Appellant, v. COUNTY OF LOS ANGELES, Defendant and Respondent. Civ. 46434.

Page 182

127 Cal.Rptr. 182

54 Cal.App.3d 992

FAIX, LTD., Plaintiff and Appellant, v. COUNTY OF LOS ANGELES, Defendant and Respondent.

Civ. 46434.

Court of Appeal, Second District, Division 1, California.

Jan. 29, 1976.

Frederick R. Schumacher, Los Angeles, for plaintiff and appellant

John H. Larson, County Counsel, and Lawrence B. Launer, Deputy County Counsel, Los Angeles, for defendant and respondent.

HANSON, Associate Justice.

INTRODUCTION

Plaintiff Faix, Ltd. (hereinafter plaintiff or FAIX) appeals from the granting of a motion for judgment on the pleadings in three consolidated tax actions made by defendant County of Los Angeles (hereinafter defendant or COUNTY). The dispute involves taxes pertaining to the valuation assessed on certain Upper San Gabriel River Basin water rights.

BACKGROUND

Plaintiff FAIX owns what previously was known as the Pellissier Ranch, comprised of about 1,200 acres located in the San Gabriel basin. On January 2, 1968, an action (No. 924128) was commenced in the Los Angeles superior court by the Upper San Gabriel Valley Water District against several defendants, among whom were plaintiff FAIX and defendant COUNTY. The answer of FAIX in that action alleges, among other things, that FAIX for more than five years prior to filing of the action 'pumped and produced water from the basin in a manner and form which has been, and is, continuously open, notorious, adverse and hostile to plaintiff (Water District) and each other defendant herein' and that FAIX as a direct proximate result

'claims riparian, overlying, appropriative and prescriptive rights' in and to said water. Judgment in action No. 924128 was entered January 4, 1973, whereby FAIX was allocated 6,490 acre feet of the mutual prescriptive rights in the water.

THE PLEADINGS

The three consolidated action in the case at bench concern taxes for three consecutive fiscal years: 1970--1971 (No. C 4062); 1971--1972 (No. C 32878); and 1972--1973 (No. C 51630). Actions C 32878 and C 51630 are each entitled 'Complaint for Refund of Real Property Taxes' and each contains two counts. The complaint in action C 4062 is entitled 'Amended and Supplemental Complaint for Refund of Real Property Taxes, and for Declaratory Relief' and contains three counts. (For the sake of brevity these pleadings collectively will hereinafter be referred to as the 'complaints.')

Although difficult to ascertain with certainty, it seems that the first count of plaintiff's three complaints is based on the claim that plaintiff's interest in the water rights was a nontaxable interest. Concerning the particular fiscal year involved, plaintiff alleged in essence: that the rolls of the county assessor set forth as taxable to plaintiff the water rights; that the assessor's total cash value exceeded $1,000,000 with a total assessed value of 25% Of such cash values; that actually the full cash value and assessed value amounted to 'zero'; that the overassessment resulted in an excessive levy of $40,398.57 taxes (action C 4060) ¹ 'by reason of the fact that plaintiff did not and does not own a taxable interest in said real property.'

The first count also alleges: The assessments were void, illegal and unconstitutional and in violation of the equal protection clauses in both state and federal Constitutions; that plaintiff paid the first installment (one-half) of the taxes to the tax collector (action C 4062--March 31, 1971; action C 38278--April 10, 1972; and action C 51630--December 1, 1972) under protest; that plaintiff 'has no administrative remedies available to it for review of taxes assessed and collected on property in which it owns no taxable interest' and is entitled to court determination; that, on information and belief, the said first installment of taxes was collected illegally and plaintiff is entitled to the sum paid (action C 4062--$21,411.23; action C 38278--$15,972.98; and action C 51630--$14,684.10) with interest; that no refund of said taxes or of any part thereof has been made.

The second count of plaintiff's complaints proceeds on the basis of denial by the Assessment Appeals Board of plaintiff's application for reduction in the assessed value of the water rights and payment under protest by plaintiff of the first installment of the taxes. ² Among other things count two alleges: that plaintiff paid under written protest the first installment of taxes assessed on the property (water rights); that plaintiff filed with the Assessment Appeals Board 'a verified petition for reduction in assessment pursuant to the provisions of Revenue and Taxation Code, Sec. 1607' which petition was heard and denied by said Board; that the appraisal and the fixing of the full cash value and the assessed value of the property It is conceded by plaintiff on appeal that, although paying the first installment under protest, FAIX never made any payment of the second installment for any of the fiscal years with which this appeal is concerned.

interests by the assessor and by the Assessment Appeals Board 'was arbitrary, erroneous, invalid, unfair, unlawful, not based on the evidence presented, nor based upon sufficient evidence, not based upon the weight of the evidence as required by law for the following reasons:' (a) that no taxable interest was owned; (b) that plaintiff's interest, if any, was too indefinite to be ascertainable; ³ (c) that the assessment violated state and federal equal protection clauses; and (d) that the assessment constituted double taxation.

The third count, which plaintiff FAIX asserts seeks declaratory relief, was added as a supplemental count by plaintiff to action C 4062. This third count concerned fiscal year 1971--1972 which is the same fiscal year involved in action C 38278. No other purported declaratory relief or third count appears. The allegations of the third count of the supplemental complaint in action C 4062 are practically duplicative of the allegations of the second count of the complaint in action C 38278 except for a request for declaratory relief.

DISCUSSION

Defendant COUNTY'S motion for judgment on the pleadings appears to have been made on the grounds that (1) each cause of action in the respective complaints failed to state facts sufficient to state a cause of action; (2) the court lacked jurisdiction to grant the relief requested by plaintiff; and (3) plaintiff was precluded from maintaining any action for refund of taxes because it assertedly failed to follow the procedures set forth in Revenue and Taxation Code section 5096, et seq. and section 5136, et seq.

The motion 'had the purpose and effect of a general demurrer (citation) and on review is to be tested by the same rules. (Citations.) Since the motion was used to perform the function of a general demurrer, it 'reaches only to the contents of the pleading and such matters as may be considered under the doctrine of judicial notice' (citation) and 'admits all material and issuable facts pleaded.' (Citation.)' (Colberg, Inc. v. State of California ex rel. Dept. Pub. Wks., 67 Cal.2d 408, 411--412, 62 Cal.Rptr. 401, 403, 432 P.2d 3, 5, cited and

followed in Kachig v. Boothe, 22 Cal.App.3d 626, 630, 99 Cal.Rptr. 393; see also, Sullivan v. County of Los Angeles, 12 Cal.3d 710, 714, fn. 3, 117 Cal.Rptr. 241, 527 P.2d 865.)

COUNT I

The first count of plaintiff's complaints alleges that plaintiff's interest in the taxed water rights was a nontaxable interest.

It is established that 'in the consideration of a pleading the courts must read the same as if it contained a statement of all matters of which they are required to take Judicial notice, even when the pleading contains an express allegation to the contrary.' (Italics added.) (Chavez v. Times-Mirror Co., 185 Cal. 20, 23, 195 P. 666, 668, cited in Martinez v. Socoma Companies, Inc., 11 Cal.3d 394, 399, 113 Cal.Rptr. 585, 521 P.2d 841.) The rule applies to a motion for judgment on the pleadings. (See Kachig v. Boothe, supra, 22 Cal.App.3d at p. 630, 99 Cal.Rptr. 393.)

In the case at bench, both parties concede that in passing upon the motion for judgment on the pleadings the trial court took judicial notice of action No. 924128 (referred to under BACKGROUND, Supra), which reflects that plaintiff FAIX at all times pertinent to the instant case has claimed an interest in the water rights including prescriptive rights thereto and that the ultimate judgment for that action (No. 924128) upheld plaintiff's claim to a proportionate share of mutual prescriptive rights therein. ⁴

Since appropriative or prescriptive water rights are properly assessed and taxed separately (see, e.g., Alpaugh Irr. Dist. v. County of Kern, 113 Cal.App.2d 286, 293, 294, 248 P.2d 117; North Kern Water Storage Dist. v. County of Kern, 179 Cal.App.2d 268, 279, 3 Cal.Rptr. 636, and authorities cited; Jurupa Ditch Co. v. County of San Bernardino, 256 Cal.App.2d 35, 40, 63 Cal.Rptr. 764), differing from riparian or overlying water rights, and a separate assessment and taxation of appropriative or prescriptive rights is not double taxation, and since it cannot be said that none of plaintiff's water rights was taxable, we hold there was no error in granting the motion for judgment on the pleadings insofar as plaintiff's first count of the complaints is concerned. ⁵

COUNT II

In directing our attention to the second count, we assume that it states facts sufficient to constitute a cause of action for refund of taxes (see McHugh v. County of Santa Cruz, 33 Cal.App.3d 533, 544, 109 Cal.Rptr. 149) unless the failure to pay the second installment of taxes renders this count deficient.

In citing McHugh, plaintiff FAIX urges that it need not have paid any tax installment, much less the second installment, in order to maintain an action against defendant COUNTY (particularly in regard to its third count for declaratory relief set forth in action C 4062). The appellate court stressed in McHugh, supra, 33 Cal.App.3d at p. 543, 109 Cal.Rptr. at p. 156,...