Willingham Bus Lines, Inc. v. Municipal Court for San Diego Judicial Dist. of San Diego County

• Citation: 428 P.2d 602,66 Cal.2d 893,59 Cal.Rptr. 618
• Court: United States State Supreme Court (California)
• Decision Date: 19 June 1967
• Parties: , 428 P.2d 602 WILLINGHAM BUS LINES, INC., Plaintiff and Appellant, v. The MUNICIPAL COURT FOR the SAN DIEGO JUDICIAL DISTRICT OF SAN DIEGO COUNTY, Defendant and Respondent; The PEOPLE of the State of California, Real Party in Interest and Respondent. L.A. 28708. In Bank

Page 618

59 Cal.Rptr. 618

66 Cal.2d 893, 428 P.2d 602

WILLINGHAM BUS LINES, INC., Plaintiff and Appellant, v. The MUNICIPAL COURT FOR the SAN DIEGO JUDICIAL DISTRICT OF SAN DIEGO COUNTY, Defendant and Respondent The PEOPLE of the State of California, Real Party in Interest and Respondent.

L.A. 28708.

Supreme Court of California,

In Bank.

June 19, 1967.

Rehearing Denied July 19, 1967.

Procopio, Price & Cory and Alfred G. Ferris, San Diego, for plaintiff and appellant.

No appearance for defendant and respondent.

Edward T. Butler, City Atty., and C. M. Fitzpatrick, Deputy City Atty., for real party in interest and respondent.

TOBRINER, Associate Justice.

The City of San Diego exacts a variety of license taxes from enterprises doing business there. ¹ As applied to charter vehicles for hire, the city imposes its tax upon apportioned gross receipts. ² The plaintiff, a corporation which furnishes charter buses for hire, contends that the application of this taxing system to its San Diego operations invades a field preempted by state law and transgresses constitutional guarantees. We have concluded that these contentions cannot stand.

The present controversy arose when the state filed a criminal complaint charging the plaintiff with conducting a charter bus service in San Diego without the required municipal license. The plaintiff demurred to the complaint and sought a writ of prohibition to restrain further proceedings in the criminal action. After considering the case on an agreed statement of facts, the trial court refused to grant to relief requested. The plaintiff appeals.

We cannot accept plaintiff's contention that its state permit as an intercity charter bus operator ³ renders it immune to the San Diego tax. Although the state might have occupied the regulatory field when it established a comprehensive system for licensing and controlling charter carriers, it did Not preempt the power to tax. Thus we have said, 'Whether or not state law has occupied the field of regulation, cities may tax business carried on within their boundaries and enforce such taxes by requiring business licenses for revenue and by criminal penalties.' (In re Groves (1960) 54 Cal.2d 154, 156, 4 Cal.Rptr. 844, 846, 351 P.2d 1028, 1030; see also Agnew v. City of Los Angeles (1961) 190 Cal.App.2d 820, 828--830, 12 Cal.Rptr. 507, (hg. den.); Arnke v. City of Berkeley (1960) 185 Cal.App.2d 842, 8 Cal.Rptr. 645 (hg. den.).)

The San Diego license tax in no sense constitutes 'an inseparable part of a regulatory scheme excluded by state law.' (In re Groves, supra, 54 Cal.2d at p. 157, 4 Cal.Rptr. at p. 847, 351 P.2d at p. 1031.) It makes no attempt to 'prescribe qualifications * * * different from or additional to those prescribed by the state.' (In re Galusha (1921) 184 Cal. 697, 699, 195 P. 406, 407; cf. Agnew v. City of Los Angeles (1952) 110 Cal.App.2d 612, 619--621, 243 P.2d 73; 44 Ops.Cal.Atty.Gen. (1964) 117, 118--121.) It simply provides 'an increase in * * * revenue by imposing a tax upon those who, by pursuing their (business) within (the municipality, derive) benefits from the advantages especially afforded by the city.' (In re Galusha, supra, 184 Cal. at p. 699, 195 P. at p. 407.) ⁴

Indeed, plaintiff concedes that San Diego could properly impose a tax upon the business which it conducts within city limits; it contends only that the license fee here exacted as a condition precedent to doing business in San Diego constitutes 'a charge * * * for the use of (the city's) streets' rather than 'a reasonable tax for the privilege of engaging in business within its boundaries.' We cannot agree.

The license tax charged by San Diego equals '2% Of the gross receipts attributable to the portion of the trip traveled within the city limits * * * by charter vehicles.' ⁵ This method of allocation obviously works to confine the tax to that part of a licensee's revenue which is derived from intracity business. ⁶ Since the city has not linked its license tax to the number of charter vehicles passing through San Diego (contrast Biber Elec. Co. v. City of San Carlos (1960) 181 Cal.App.2d 342, 5 Cal.Rptr. 261 (one dollar per vehicle)) or to the total mileage travelled by such vehicles within the city, that fee cannot be considered a charge for the use of San Diego streets. ⁷

Having concluded that the tax in question invades no area of exclusive state concern, we turn to the plaintiff's constitutional contentions. In support of the argument that the statute defines the tax too vaguely to comport with due process, plaintiff simply points to a dispute over the precise meaning of the word 'mileage' in the taxing provision. ⁸ If the mere existence of such a controversy could render a tax void for vagueness, no statute could ever withstand constitutional attack. No infirmity of constitutional dimension arises from the alleged marginal ambiguities.

We come, then, to the plaintiff's final challenge, one couched in terms of equal protection. The plaintiff urges that we invalidate the license tax on the ground that other businesses, including other kinds of vehicles for hire, are taxed not upon apportioned gross receipts but upon various other bases. ⁹ The plaintiff has not attempted to establish that these disparate formulae for taxation work a concrete hardship upon charter bus lines; the equal protection argument must therefore stand or fall with the novel proposition that a municipality is powerless to employ more than one method of computing taxes for various businesses unless it can demonstrate some compelling justification for doing so.

So narrow a view of municipal power, and so expansive a reading of the equal protection clause, would require a radical departure from the settled breadth of legislative authority to draw distinctions for purposes of taxation. (See, e.g., First Unitarian Church of Los Angeles v. County of Los Angeles (1957) 48 Cal.2d 419, 432--433, 311 P.2d 508; Fox etc. Corp. v. City of Bakersfield (1950) 36 Cal.2d 136, 141--144, 222 P.2d 879; County of Los Angeles v. Southern Cal. Tel. Co. (1948) 32 Cal.2d 378, 388--392, 196 P.2d 773; Crocker-Anglo Nat. Bank v. Franchise Tax Board (1960) 179 Cal.App.2d 591, 595, 3 Cal.Rptr. 906.)

The proposed departure from precedent seems particularly inappropriate today. 'As our social and economic life grows in complexity, legislation necessarily increases in the differentiation of its techniques and in the specialization of its objectives.' (Wilke & Holzheiser, Inc. v. Dept. of Alcoholic Bev. Control (1966) 65 A.C. 385, 401, 55 Cal.Rptr. 23, 33, 420 P.2d 735, 745.) Now, more than ever, courts must not burden those who formulate tax policy with Procrustean requirements of absolute equality.

The judgment is affirmed.

TRAYNOR, C.J., and McCOMB, PETERS, MOSK, BURKE, and SULLIVAN, JJ., concur.

1 'There is hereby imposed upon the businesses, trades, callings and occupations in this article enumerated a license tax or fee in the amount hereinafter specified, and it shall be unlawful to conduct, manage or carry on any such business * * * without having first secured a license so...