Transcontinental Gas Pipe Line Corp. v. Ltc

Decision Date10 August 2009
Docket NumberNo. 2009 CA 0628.,No. 2009 CA 0629.,2009 CA 0628.,2009 CA 0629.
Citation23 So.3d 329
PartiesTRANSCONTINENTAL GAS PIPE LINE CORPORATION, Texas Eastern Transmission Corporation, Florida Gas Transmission Company, and Gulf South Pipeline Company, L.P. v. LOUISIANA TAX COMMISSION; Frank Granger, III, In his Official Capacity as the Assessor of East Baton Rouge Parish; and Elmer B. Litchfield, In his Official Capacity as the Sheriff and Ex Officio Tax Collector for East Baton Rouge Parish. Florida Gas Transmission Company v. Louisiana Tax Commission; Elizabeth Guglielmo, In her Capacity as Chairperson of the Louisiana Tax Commission; Sheriff Wayne Melancon, Acadia Parish; Sheriff Mike Waguespack, Assumption Parish; Sheriff Tony Mancuso, Calcasieu Parish; Sheriff Theos Duhon, Cameron Parish; Sheriff Greg Phares, East Baton Rouge Parish; Sheriff Sid Hebert, Iberia Parish; Sheriff Brent Allain, Iberville Parish; Sheriff Richard Edwards, Jr., Jefferson Davis Parish; Sheriff Michael Neustrom, Lafayette Parish; Sheriff Craig Webre, Lafourche Parish; Sheriff Paul Raymond Smith, Pointe Coupee Parish; Sheriff Gregory Champagne, St. Charles Parish; Sheriff Ronald Ficklin, St. Helena Parish; Sheriff Bobby Guidroz, St. Landry Parish; Sheriff Ronald J. Theriot, St. Martin Parish; Sheriff David A. Naquin, St. Mary Parish; Sheriff Daniel Edwards, Tangipahoa Parish; Sheriff Michael Couvillion, Vermilion Parish; Sheriff Aubrey Jones, Washington Parish; and Sheriff Mike Cazes, West Baton Rouge Parish, in their Capacities as ex Officio Tax Collectors in and for their Respective Parishes. Hon. Russel L. Benoit, Acadia Parish; Hon. Wayne P. Blanchard, Assumption Parish; Hon. Richard J. Cole, Jr., Calcasieu Parish; Hon. Robert E. Conner, Cameron Parish; Hon. Brian Wilson, East Baton Rouge Parish; Hon. Rickey J. Huval, Sr., Iberia Parish; Hon. James H. Dupont, Iberville Parish; Hon. Donald G. Kratzer, Jefferson Davis Parish; Hon. Conrad Comeaux, Lafayette Parish; Hon. Michael H. Martin, Lafourche Parish; Hon. James A. Laurent, Pointe Coupee Parish; Hon. Clyde A. Gisclair, St. Charles Parish; Hon. Wesley Blades, St. Helena Parish; Hon. Rhyn L. Duplechain, St. Landry Parish; Hon. Lawrence Patin, St. Martin Parish; Hon. Sherel A. Martin, Jr., St. Mary Parish; Hon. Joaquin Matheu, Tangipahoa Parish; Hon. Michael Langlinais, Vermilion Parish; Hon. M. Randall Seal, Washington Parish; and Hon. Barney Altazan, West Baton Rouge Parish, in their Capacities as Assessors in and for their Respective Parishes.
CourtCourt of Appeal of Louisiana — District of US

Michael J. Vallan, Baton Rouge, LA, for Defendant/Appellee, State of Louisiana Attorney General Office.



This is an appeal from the partial grant of a partial summary judgment filed in an ad valorem tax dispute between Florida Gas Transmission Company (the plaintiff), an interstate natural gas pipeline company, and the defendants, the Louisiana Tax Commission (LTC) and various sheriffs and assessors throughout the state of Louisiana. This appeal has been expedited in accordance with La. R.S. 47:1998.

At issue is whether Louisiana's ad valorem tax scheme violates the Commerce Clause of the United States Constitution either in form or in application. After due consideration, that part of the district court judgment partially granting the assessors' motion for summary judgment is affirmed. That part of the district court judgment partially denying the assessors' motion for summary judgment is reversed, and we render judgment declaring La. R.S. 47:1851 K unconstitutional and La. R.S. 47:1851 M unconstitutional in part.


The facts of this case, although lengthy, are substantially undisputed. The plaintiff is the owner of interstate natural gas pipelines located in part within the territorial boundaries of Louisiana. At issue herein is the plaintiffs liability for 2006 Louisiana ad valorem taxes.

The plaintiff is a "pipeline company," as defined in La. R.S. 47:1851 K, that owns, and owes ad valorem taxes on, "public service property," as that category of property is defined in La. R.S. 47:1851 M. So defined, the plaintiff is subject to an assessment of 25% of fair market value, as determined by the LTC. See La. Const, art. VII, § 18. Other similarly situated, direct competitors operating in intrastate commerce do not meet the definition of "pipeline companies." Their properties are not considered "public service properties," and therefore, they are subject to assessments of 15% of fair market value, as determined by the local assessors. See La. Const, art. VII, § 18.

The plaintiff paid its 2006 ad valorem tax assessment under protest and filed suit, asserting therein that "challenges to the assessed valuation of its pipeline property by the LTC and to the Louisiana ad valorem tax scheme ... are solely constitutional issues." The plaintiff sought a finding that "the Louisiana ad valorem tax scheme is unconstitutional [and] in violation of the Commerce Clause of the United States Constitution, in that it imposes an impermissible burden on interstate commerce by imposing a greater tax burden on interstate natural gas pipelines companies than it does upon intrastate natural gas pipeline companies." Specifically, the plaintiff maintained that the assessment of its property at 25% of fair market value, as opposed to 15% of fair market value, is in violation of the Commerce Clause of the United States Constitution.2

Named as defendants in this litigation are the LTC; Elizabeth Guglielmo, in her capacity as Chairperson of the LTC; and twenty sheriffs and twenty assessors from parishes scattered throughout the state of Louisiana.3

On motion of various assessors, this action (bearing docket number 551,435) was transferred and consolidated with district court docket number 491,453 (Transcontinental Gas Pipe Line Corporation, et al. v. Louisiana Tax Commission, et al.). Numerous distinct district court actions have been consolidated under docket number 491,453 and are currently pending in the Nineteenth Judicial District Court. Although there may be some overlap in the plaintiffs, the defendants, and the tax years in these consolidated actions, each action is unique. See Dendy v. City National Bank, 2006-2436 (La.App. 1 Cir. 10/17/07), 977 So.2d 8, 11 (noting that the consolidation of actions pursuant to La. Code Civ. P. art. 1561 is a procedural convenience designed to avoid multiplicity of actions and does not cause a case to lose its status as a procedural entity). In common, the plaintiffs in each suit are corporate interstate pipeline companies, all challenging the constitutionality of Louisiana's ad valorem tax scheme.

Thirteen assessors collectively answered the plaintiffs petition.4 Thereafter, a motion for summary judgment was filed on behalf of twelve assessors.5 The assessors asked for a declaration as to the constitutionality of the Louisiana ad valorem tax scheme and, to the extent the district court determined the tax scheme to be unconstitutional, a judgment specifically striking the unconstitutional provisions. The assessors also asked for entry of summary judgment dismissing the plaintiffs claims for refunds and remanding this matter to the LTC for revaluation of the plaintiffs property by the parish assessors and reassessment at 15% of fair market value. Succinctly stated, through their motion for summary judgment, the assessors asked the district court to determine the legal efficacy of the plaintiffs claims.

Later, Sheriff Greg Champagne of St. Charles Parish and Sheriff Sidney Gautreaux filed their own answers to the plaintiffs petition.6 Sheriff Champagne and Sheriff Gautreaux did not join in the motion for summary judgment and are not parties to this appeal.

On December 16, 2008, the district court signed a written judgment granting in part and denying in part the motion for summary judgment filed by the "Assessors of Acadia; Cameron; East Baton Rouge; Iberia; Jefferson Davis; Lafourche; St. Landry; St. Martin; St. Mary; Vermilion and Washington Parishes in Docket No. 551,432."7 The trial court rendered judgment, finding that in order to avoid a violation of the Commerce Clause of the United States Constitution, taxes on all pipeline property (whether operated in interstate or intrastate commerce) should be calculated at a 15% rate. Citing to Transcontinental Gas Pipe Line Corporation v. Louisiana Tax Commission, 2005-2604, 2005-2605 (La.App. 1 Cir. 3/31/06), 925 So.2d 777 (unpublished), writ denied, 2006-0988 (La.9/1/06), 936 So.2d 204, and ANR Pipeline Co. v. Louisiana Tax Commission, 2005-1142 (La.App. 1 Cir. 9/7/05), 923 So.2d 81, writ denied, 2005-2372 (La.3/17/06), 925 So.2d 547, cert. denied, 549 U.S. 822, 127 S.Ct. 157, 166 L.Ed.2d 38, the district court further remanded the matters to the LTC with instructions that the LTC require the named assessors "to determine the valuation of public service properties of the Plaintiff, Florida Gas Transmission Company[,] in their respective parishes for each year at issue and calculate ad valorem taxes based on fifteen percent (15%) of those assessments." The district court found it unnecessary to rule on the constitutionality of La. R.S. 47:1851 in reaching its decision.

On motion of the assessors, the trial court designated the partial judgment as final and immediately appealable pursuant to La.Code Civ. P. art. 1915 B. The plaintiff then moved for orders of appeal to both the Louisiana Supreme Court and to the Louisiana First Circuit Court of Appeal. A...

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1 cases
    • United States
    • Louisiana Supreme Court
    • 16 Marzo 2010
    ...situated; therefore, dormant Commerce Clause analysis is appropriate." Transcontinental Gas Pipe Line Corp., et al. v. Louisiana Tax Commission, et al., 09-0628 (La.App. 1 Cir. 8/10/09), 23 So.3d 329, 340. The court examined the ad valorem tax assessment procedures under the Amerada Hess fa......

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