R.J. D'Hemecourt Petroleum, Inc. v. McNamara
| Decision Date | 28 November 1983 |
| Docket Number | No. 83-CA-1231,83-CA-1231 |
| Citation | 444 So.2d 600 |
| Parties | R.J. D'HEMECOURT PETROLEUM, INC., et al. v. Shirley McNAMARA, Secretary of the Department of Revenue and Taxation, State of Louisiana. |
| Court | Louisiana Supreme Court |
Frank J. Uddo, New Orleans, for plaintiff-appellee.
Howard M. Romaine, Baton Rouge, for defendant-appellant.
In this class action suit by Louisiana retail gasoline merchants, plaintiffs asked that LSA-R.S. 47:353 1 be declared unconstitutional as to them and occupational license taxes paid under protest be refunded. The trial court declared the law unconstitutional and ordered the refunds. LSA-R.S. 47:2110. 2 The Secretary of the Louisiana Department of Revenue and Taxation has appealed. 3
At the outset of trial, all parties stipulated to the class as being all retail gasoline merchants who paid the occupational license tax under protest for the years 1979 and 1980 (Tr. 3). A list of such merchants was placed into the record (S-1).
A stipulation has the effect of a judicial admission or confession, 4 which binds all parties and the court. Placid Oil Company v. A.M. Dupont Corporation, 244 La. 1075, 156 So.2d 444 (1963). Stipulations between the parties in a specific case are binding on the trial court when not in derogation of law. Wickliffe v. Cooper and Sperrier, 161 La. 417, 108 So. 791 (1926). Such agreements are the law of the case. 5 The class action was appropriate.
In declaring LSA-R.S. 47:353 unconstitutional, the trial court found that its interaction with federal "margin of profits" regulations 6 6 produced a discriminatory effect upon retail gasoline merchants in violation of the equal protection clause of the Fourteenth Amendment to the United States Constitution and Art. I, § 3, Louisiana Constitution of 1974. 7
Under Section 353, the tax becomes larger as gross sales increase. Although the wholesale price of gasoline soared in 1979 and 1980 due to cutbacks in supply by oil producing countries, plaintiffs' retail profits were curtailed by federal limitations. Plaintiffs claim that these federal limits on their profits distinguish them from other retail merchants resulting in a discriminatory tax burden from the occupational license tax.
Statutory classifications do not violate equal protection guarantees if they bear a rational relation to a legitimate governmental purpose. Statutes are subject to a higher level of scrutiny if they interfere with the exercise of a fundamental right or employ a suspect classification. Harris v. McRae, 448 U.S. 297, 100 S.Ct. 2671, 65 L.Ed.2d 784 (1980). The tax on retail gasoline merchants does neither.
Legislators have broad latitude in creating tax classifications. In Regan v. Taxation with Representation of Washington, --- U.S. ---- at ----, 103 S.Ct. 1997 at 2002, 76 L.Ed.2d 129 at 138 (1983) the court stated:
"
State taxes with the collateral effect of restricting or even destroying a business or occupation have been sustained. Lehnhausen v. Lake Shore Auto Parts, 410 U.S. 356, 360, 93 S.Ct. 1001, 1004, 35 L.Ed.2d 351, 355 (1973).
In Acorn v. City of New Orleans, 377 So.2d 1206 (La., 1979) there was a constitutional challenge to a city ordinance which imposed a one hundred dollar annual charge on each parcel of real property separately listed on the tax rolls. Although the tax had a disproportionate impact on owners of small and large tracts, the city ordinance was upheld:
To be unconstitutional, a classification must be manifestly arbitrary and unreasonable, and not possibly so. Gulf States Utilities Co. v. Traigle, 310 So.2d 78 (La., 1975). A discriminatory purpose is not presumed. Parties attacking a statute must bear the burden of proving clear and intentional discrimination. Louisiana & Arkansas Railway Company v. Goslin, 300 So.2d 483 (La., 1974).
These service station owners lost profits because the product they sold cost more and there was a diminished quantity available for sale. This situation was exacerbated by federally imposed profit limitations. However, no evidence has been offered that other retail merchants subject to the tax did not suffer from similar adverse circumstances. 8 Thus, these retail gasoline merchants have failed to distinguish themselves from other retail merchants. The pressures of the market place could have acted in the same manner as the federal profit controls to limit other retailers' gross profits.
The statute creates a class of retailers taxed on a sliding scale based on gross profits. It has a rational relationship to a legitimate government purpose, raising revenue. While the tax may have a disproportionately greater impact upon retailers subject to federal profit controls, no violation of equal protection has been proven.
For the reasons assigned, the judgment of the trial court is reversed and plaintiffs' suit is dismissed.
REVERSED.
APPENDIX
LSA-R.S. 47:353 provides:
"For every business of selling merchandise, soda water, ice cream, confections, soda pop, coca-cola, cherocola, grapico, or other similar soft drinks or beverages or refreshments, at retail; or for the business of operating a restaurant, tea room, coffee house or other eating house, establishment or place where any charge whatsoever is made for any food, drink or service, whether attached to or conducted separate and apart from any other business; or for the business of operating vending machines or weighing machines, except those operated for the cooling and vending of bottled soft drinks, not otherwise provided for by this chapter, or by special laws, whether the business be conducted as principal, agent on commission or otherwise, the license shall be based on the gross sales. The amount of this license shall be as shown in the following table:
"If the Gross Sales are:
As Much As But Less Than The Annual License
Shall Be
$ 0 $ 5,000 $ 5
5,000 10,000 10
10,000 15,000 15
15,000 20,000 20
20,000 25,000 25
25,000 30,000 30
30,000 40,000 35
40,000 50,000 50
50,000 75,000 60
75,000 100,000 90
100,000 150,000 120
150,000 200,000 180
200,000 250,000 250
250,000 300,000 300
"Q. Would you please tell it to the Court?
"A. Well, I think that it is grossly unfair and
it has been discriminatory because we were
probably the only category of business who
suffered such an increase in an occupational
license tax because of actions of foreign
countries, for example.* * *" (emphasis added)
To continue reading
Request your trial
-
Bernard v. BFI Waste Serv., LLC
..., 413 So.2d 230 (La.App. 4th Cir.1982). It binds all parties and the court when not in derogation of the law. R.J. D'Hemecourt Petroleum Co. v. McNamara , 444 So.2d 600 (La.1983), cert. denied , 469 U.S. 820, 105 S.Ct. 92, 83 L.Ed.2d 39 (1984).After carefully reviewing the trial court's jur......
-
Socorro v. Orleans Levee Bd.
...and stipulations by the City constitute a judicial admission or confession which becomes the law of the case. R.J. D'Hemecourt Petroleum v. McNamara, 444 So.2d 600 (La.1983), cert. den., 469 U.S. 820, 105 S.Ct. 92, 83 L.Ed.2d 39 (1984); Placid Oil Co. v. A.M. Dupont Corp., 244 La. 1075, 156......
-
Beychok, In re
...297, 96 S.Ct. 2513, 49 L.Ed.2d 511 (1976); Harry's Hardware, Inc. v. Parsons, 410 So.2d 735 (La.1982). See also, R.J. D'Hemecourt Petroleum v. McNamara, 444 So.2d 600 (La.1983), cert. denied, --- U.S. ----, 105 S.Ct. 92, 83 L.Ed.2d 39; State v. Petrovich, 396 So.2d 1318 (La.1981); Bazley v.......
-
Willis v. Noble Drilling (US), Inc.
...judge refused to allow introduction of this evidence, which would nullify the stipulation. 8.La. C.C. art. 1853; R.J. D'Hemecourt Petroleum v. McNamara, 444 So.2d 600 (La.1983), cert. denied,469 U.S. 820, 105 S.Ct. 92, 83 L.Ed.2d 39 (1984); Comberrel v. Basford, 550 So.2d 1356 (La.App. 5 Ci......