Document: 457 U.S. 393 102 S.Ct. 2498 73 L.Ed.2d 93 CALIFORNIA, et al., Appellants,v.GRACE BRETHREN CHURCH al. UNITED STATES, Appellants, v. GRACE CHURCH, STATES Nos. 81-31, 81-228, 81-455. Argued March 30, 1982. Decided June 18, Syllabus The Federal Unemployment Tax Act established a cooperative federal-state scheme to provide benefits unemployed workers. requires employers pay an excise tax on wages paid employees in "covered" employment, but entitles them credit the federal for contributions into federally approved state unemployment compensation programs. Act, 26 U.S.C. § 3309(b), exempts from mandatory coverage of, inter alia, "an organization which is operated primarily religious purposes and operated, supervised, controlled, or principally supported by church convention association of churches." A number California churches schools, including schools unaffiliated with any church, brought suit District Court enjoin Secretary Labor conditioning his approval insurance program its plaintiffs' employees, State collecting both information tax. conducted various proceedings issued several opinions orders extending over almost year half, one it rejected Government's argument that court was barred granting injunctive relief Injunction provides district courts "shall not enjoin, suspend restrain" assessment collection where "a plain, speedy efficient remedy" may be had such State. Ultimately, as pertinent here, ground benefit entitlement decisions risked excessive entanglement religion violation Establishment Clause First Amendment, permanently enjoined defendants taxes did issue injunction against because no what response would make court's conclusion could constitutionally impose schools. said if instituted decertification failing collect behalf parties apply further relief. Held : 1. This has jurisdiction hear these appeals under 28 1252, permits this federal-court judgment holding Congress unconstitutional civil action United States agencies, officer employee thereof, party. While expressly hold 3309(b) applied churches, effect "the officers . bound unconstitutionality." McLucas DeChamplain, 421 21, 31, 95 1365, 1371, 43 699. Pp. 404-407. 2. deprived declaratory 407-419. (a) That prohibits well Because procedure "may every practical sense operate until litigation ended," Great Lakes Dredge & Dock Co. Huffman, 319 293, 299, 63 1070, 1073, 87 L.Ed. 1407, very language Act—"suspend taxes—suggests prohibited issuing cases. Moreover, there little difference between relief, unlikely intended prohibit taxpayers seeking form while permitting seek another, thereby defeating principal purpose "to limit drastically" interference taxes. 407-411 (b) state-court remedy "plain, efficient" within meaning only "provides taxpayer 'full hearing judicial determination' at she raise all constitutional objections tax." Rosewell LaSalle National Bank, 450 503, 514, 101 1221, 1229, 67 464. 411-413. (c) Here, question refund their through administrative procedures, obtain review claims, law Act. There merit taxpayers' procedures constitute Amendment claims effectively remedied unavailable California. First, should able challenge constitutionality before extensive occurs, agencies can expected abide resulting rulings. Second, extent occurs questions, reduced instead courts. carve out special exception who undermine Act's primary purpose. 413-417. (d) Where without jurisdiction, will consider merits claims. supra, Weinberger Salfi, 422 749, 2457, 45 522, distinguished. 418-419 Vacated remanded. Harriet S. Shapiro, Washington, D. C., States, Jeffrey M. Vesely, Los Angeles, Cal., California, William B. Ball, Harrisburg, Pa., Grace Brethren Church, Justice O'CONNOR delivered opinion Court. 1 presented whether certain statutes violate Free Exercise Clauses Amendment1 requiring We do reach substantive question, however, 1341,2 challenges. Accordingly, we vacate below. 2 * Last Term, St. Martin Evangelical Lutheran Church South Dakota, 451 772, 2142, 68 612 (1981), considered statutory challenges provisions (FUTA), §§ 3301-3311 (1976 ed. Supp.IV). present involve same interpreted Martin, recount briefly substance legislative history relevant turning facts A. 3 In FUTA,3 authorized employment,4 up 90% they have programs.5 One requirements programs "cover" broad categories employment. 4 Until 1970, 3306(c)(8) excluded definition covered employment "service performed employ religious, charitable, educational, other [tax exempt] organization." Pub.L. 86-778, 533, 74 Stat. 984. As consequence, organizations were required either amended FUTA require plans cover nonprofit organizations, hospitals, institutions higher education, thus eliminating exemption available organizations.6 See 3309(a)(1). At time, enacted exempt narrow class educational i.e., exempted services performed. 5 "(1) (A) (B) churches; 6 "(2) duly ordained, commissioned, licensed minister exercise ministry member order duties order; 7 "(3) school institution education." 91-373, 104(b)(1), 84 698. 8 1976, again FUTA, time 3309(b)(3), removing blanket employees. Compensation Amendments 94-566, 115(b)(1), 90 2670.7 maintain compliance promptly corresponding See, e.g., Cal.Un.Ins.Code Ann. 634.5(a), (West Supp.1982). B 9 plaintiffs cases, sought tax.8 For evaluating divided three classes employers: Category I represents those are part corporate structure II includes separate corporations formed III "operated purposes, [are] controlled independent, non-church affiliated school." Supplemental Opinion, reprinted App. Juris. Statement No. p. 71 (J.S.App.).9 10 On September 1979, granted preliminary State, restraining plaintiffs. id., 51. basis 3309(b)(1), alternatively, terms governmental religion, Amendment. J.S.App. 58-65. 11 opinion, that, efficient," 1341, Considering first availability courts, concluded provisions10 made "at best, uncertain." 66. then inadequate claimed property been taken unlawfully, also "very process determining due results rights." Id., 67. injury "irreparable" once collected, existed grant 12 supplemental filed 2, 1980, clarified earlier stating 71. reasons initial injunction, extended continued deny after concluding exemptions risk too small Clause. 77-79.11 13 Finally, April 3, 1981, second ruling motions permanent injunctions enjoining Government inclusion provision, 634.5(a) Supp. 1982). 3-15.12 found 25-33.13 Consequently, held "constitutional considerations bar application scheme" 33. 14 Based findings, precondition programs, 47, 51, "collecting, attempting collect, taxes" I, II, 50. 1982) unconstitutional. 45, 46. 15 "has indicating response, any, Court's If Secretary, failure institutes relief." Second Opinion 44, n. 39. 16 Following issuance decided 3309(b)(1)(A) Although noted footnote 17 "[t]o establish separately incorporated (or organization) must satisfy 3309(b)(1)(B): (1) 'is purposes,' (2) 'operated, churches.' " U.S., 782-783, 12, S.Ct., 2148, 12. 18 result reconsidered position statutorily FUTA. defendants, appealed involving schools.14 19 An matter our attention appeals.15 provided 20 "[a]ny party appeal Supreme interlocutory final judgment, decree action, suit, proceeding employee, party." 1252. 21 possible doubt regarding appellate provision requirement unconstitutional." 22 699 (1975), stated 1252 unambiguous policy minimizing docket Indeed, "language statute sufficiently demonstrates purpose: afford immediate actions 1371. "when unconstitutionality particular circumstance, rather than upon challenged whole." Fleming Rhodes, 331 100, 102-103, 1140, 1141-1142, 91 1368 (1947) (discussing predecessor Aug. 24, 1937, 50 751). Christian Echoes Ministry, Inc., 404 561, 563, 92 663, 664, 30 716 (1972) (per curiam ); Darusmont, 449 292, 549, 550, 66 513 (1981). even though lower declare unconstitutional, so long determination "was necessary predicate relief" granted. Clark, 445 23, 26, 100 895, 899, 171 (1980).16 23 case, appellees,17 example, discussing claim held: 24 "Since [involving resolution questions faith doctrine secular tribunals] inevitable during eligibility scope scheme, them." 33 (emphasis added). 25 Examination portions makes clear use word "scheme" refers combined provisions. (expressly referring "unemployment scheme"); (referring intent Legislature scheme"). analysis leading based solely understanding operation course prompted passage place.18 Cf. 780, 9, 2147, (holding Dakota interpretation "analysis depended entirely Amendment"). "institutes California" relief," mean Secretary. Under circumstances, "bound unconstitutionality," appeal. above, declared schools.19 jurisdiction. 65-69. reaching appellees' claim, decide correctly ruled 27 states simply restrain State." It plain court, most reserved question,20 now conclude laws Initially, observe divests officials, take "suspend "procedure 1407 (1943), suggests cases.21 Additionally, hard pressed anticipatory officials Act: drastically interfere important local concern taxes." 1233, 464 (1981).22 BRENNAN concurring dissenting Perez Ledesma, 401 82, 128, 17, 674, 698, 701 (1971): 29 "If test assessments, administration might thrown disarray, escape ordinary procedural imposed law. During pendency revenue obstructed, consequent damage State's budget, perhaps shift insolvency. issues likely turn law, which, like regulatory more properly heard courts." Fair Assessment Real Estate Assn., Inc. McNary, 454 108-109, 6, 177, 182, 70 271 (1981).23 31 Congress' enacting prevent taxes, cases authorities unless appellees 32 occasion After reviewing previous decisions24 Act,25 "state-court [to meet] minimal criteria." 512, 1228 original). particular, 1229 (quoting Bank County Cook, 57 Ill.2d 318, 324, 312 N.E.2d 252, 255-256 (1974)).26 Applying considerations, Illinois allegedly tax27 holding, specifically relied Reports demonstrating congressional awareness refunds exclusive many systems.28 reflects express command historical reluctance systems adequate Dows City Chicago, Wall. 108, 110, 78 65 (1871), enactment 34 "No equity allow [state taxes], except protect rights citizen whose taxed, he processes appear enforcement lead multiplicity suits, produce irreparable injury, aid invoked."29 35 accommodate concerns faithful systems, construe narrowly 36 With principles mind, determine exists claim. 37 dispute procedures. Once from, denied by, appropriate agency, see 1176-1185 1972 Supp.1982),30 file Superior paid, raising arguments validity 1241 unsuccessful trial, decision ultimately Nothing prevents "rais[ing] tax" 1229. noted, "Act contemplates nothing more." 516, 19, 1230, 19.31 assuming meritorious, view, reason believe respect declaration. Pacific Motor Transport Bd. Equalization, Cal.App.3d 230, 236, 104 Cal.Rptr. 558, 562 (noting "relief afforded 'prevent enjoin' otherwise hamper future effort [i]t presumed agency declaration concerning regulation's validity"). appears directly applicable 38 contend, 10, supra. Injunctive necessary, prior review, employer meet recordkeeping, registration, reporting requirements, 1085, 1086, 1088, 1092 1982), potentially subject hearings32 rights. fear violated opportunity court. 39 unpersuasive. precludes challenging former soon payment fund, and, exhausting remedies, tax.33 prevails argument, taxing proceedings. Board Cal.Rptr., 562. Thus, hearings 40 some recordkeeping hearing, pending burdens seeks whatever harm suffer Stated differently, apparent advantages remedies less efficient."34 41 keep mind passed aware sole unlawfully collected S.Rep.No.1035, 75th Cong., 1st Sess., (1937); H.R.Rep.No.1503, (1937).35 Carving significantly 1233.36 judgments disrupt when available, decline find claims.37 consequently, relief.38 C 42 Despite absence Court, urge us "public interest in, Secretary's need for, definitive 3309(b)." Brief 21. bases 32, 1372, "whether act, case here 1252." 763, 8, 2466, 522 (1975). unavailing, trial jurisdiction,39 whereas nonetheless appeals, litigants sidestepped neatly longstanding available.40 44 vacated, remanded consistent opinion. So ordered. 46 STEVENS, whom BLACKMUN joins, dissenting. 47 Appellee Central claiming violates Constitution. Pursuant providing expedited kind,1 byassing Appeals precisely intended. Recognizing prompt affecting nationwide statute, holds invoked. reaches curious administer pass statute.2 Neither nor strange result. 48 suspend, activities authorities. preclusion specific problem concerned 1937. sue privileged foreign invoke diversity These suits objectionable discrimination treasuries often revenues adjudicated involved state-law resolution. 1-2 81 Cong.Rec. 1416-1417 (1937) (Sen. Bone); 1239, (STEVENS, J., dissenting). 49 literal reading manifestly does preclude entered litigation. Nor gave rise bar. Appellees' Constitution directed administered according requirements. Only involved. recognized equitable justification withhold precluded intervening years, sufficient unnecessary interference. Today, confronts situation implicate concerns.3 Ironically, unusual traditional ban seems spur revise To accomplish revision, ignore limited enactment. relies Johnson ch. 283, 775, ante, 409-410, 22, Declaratory Judgment 955. Even suspect overlooked, fact remains books fit avoidance hardly worth nimble lawmaking.4 51 power duty merits. therefore respectfully dissent. "Congress shall respecting establishment prohibiting free thereof." Due Process Fourteenth Cantwell Connecticut, 310 296, 303, 60 900, 903, 1213 (1940); Everson Education, 330 1, 15, 504, 511, 711 (1947). provides: "The assessment, levy originally Title IX Social Security 1935, 531, 639. 3301. 3302 Each receives annual finds complies standards. 3304(a), standards contained 3304 3309. plan standards, receive plan. 49d(b); 501. Employment 697. 3309(a)(2) 3304(a)(6)(B), given option making contribution fund employers, reimbursing payments actually organizations' laws, "employment" 3306(c)(8), excluding remained unchanged. place, substituted unrelated provision. grew two (Case CV 79-93 MRP), Missouri Synod. successfully removed 79-162 MRP) consolidated trial. comprise Order (filed Apr. 1981), 49, case. 45. include Un.Ins.Code 1851 1972) writ mandate legal proceeding, thereof division." Const., Art. XIII, illegal, maintained recover interest, manner Legislature." apparently provisions, "uncertain" plaintiff being Las Animas San Joaquin Land Preciado, 167 Cal. 580, 587, 140 P. 239, 242 (1914) (injunction assessing land authority); Bueneman Santa Barbara, Cal.2d 405, 407, P.2d 884, 886 (statutory precluding execution public unconstitutional). More recent decisions, precluded. Modern Barber Colleges, Stabilization Comm'n, 720, 723, 192 916, 918 (1948) Insurance similar 1851, leaving refund); Aronoff Franchise Board, 180, 383 409, 411 (1963) Cal.Const., Cal.Rev. Code 19081 1970) additional income taxes). Relying Aronoff, Appeal (which, 1974, became successor 15), 1972), Lorco Properties, Department Benefit Payments, 809, 815, 129 312, 315 (1976). Recently, Gas Electric Cal.3d 277, 279, 165 122, 123, 611 463, (1980), compelling board adjust taxpayer's real assessments. exceptions rule, 282, 125, P.2d, 466, reaffirmed importance permit uninterrupted (noted regulation, effort"). offered imposition Clause, unique treatment equal protection. 78. alternatively Labor's correct (i.e., coverage), caused "[i]ntrusive monitoring "[i]nvolvement discharged schools." 46; 16-25, protection 35. 11-12; pp. 4, 5. cross-appeal (No. 81-455) erred cross-appeal, preserve since Rule 10.5 appellee, filing [may] defend record expand granted." brief support Because, neither plaintiffs, address setting oral postponed consideration 961, 499, 376 Claims ordered another decision, Gentry 212 Ct.Cl. 546 F.2d 343 (1976), rehearing denied, 27, 551 852 (1977). direct reference 3309(b)). believed discussion follow 3309, existed, hearing. Since follows No paid. (1943). substantial disputes. perceived device reduce abuses associated injunctions, "settle controversies," S.Rep.No. 1005, 73d 2d (1934), instances preventive H.R.Rep.No.1264, (1934). sure, weapon used businesses delay avoid paying 1416 (remarks Sen. Bone). arguable mention years earlier, indicates Nevertheless, worried much about divesting administration. Both Senate House Reports, debates rely underlying 1934, 1342, "enjoin, operation" utility commission order. 2; 1415-1417 turn, utilities going S.Rep.No.125, (1933) (in bill, declaring "will required, set commission, proceed complaint. dissatisfied supreme States"); ("It matters regulation doing duty, robs people accrue them, commissions permitted perform duty"); H.R.Rep.No.1194, (1934) opposition "seeks withdraw completely relating boards rates chargeable utilities"); 1916 Johnson); 1918 ("the object [the utilities] States; give instance public-utility right have, guaranteed infringed all, then, course, highest tribunal Court"); 8324 Rep. Mapes) allowed proper functions supervision fixing rates, continue thwart bill deprive rate cases"); 8328 Lewis) ("The absolutely abolishes 8338 Tarver) contains proposition, divest 8419 Hancock) [save money] last resort"). dangers inherent disrupting systems. (1871) taxation chiefly means carry respective governments, utmost modes adopted enforce levied interfered possible. Any officers, devolved derange operations government, cause serious detriment public"). Tully Griffin, 429 68, 74, 97 219, 223, 227 (1976); Hillsborough Cromwell, 326 620, 625, 445, 449, 358 (1946); 300-301, 1074. (1937). 1342 (prohibiting utilities), modeled. 515, 517, 1231 (making consideration); (under "full controversy assured. cases"). county her S.Rep.1035, (state "statutes generally contest protest"); Boise Artesian Hot Cold Water City, 213 276, 426, 428, 53 796 (1909) illegality municipal itself States. aggrieved left complete, practicable equity"); Singer Sewing Machine Benedict, 229 481, 488, 942, 944, 1288 (1913) "ha[s] complete law); 1073 "considerations led refuse save exceptional restraint procedure"); 103, 179, (1981) "and preceded it, reflect fundamental principle comity governments essential 'Our Federalism,' particularly area taxation"). Apparently, cannot already sustained challenge. III, 3.5, "[a]n power: "(a) unenforceable, unconstitutional; "(b) Significantly, remarkably upheld efficient." 508-509, nn. 7, 1226-1227, 7. fact, favorable improperly 1242 hesitated uncertain. (1946), proceedings, discretionary "there [was] uncertainty New Jersey speculative," 1256 dismissed "misconduct" "left work voluntarily good cause." Part necessity rests premise held. appellees, regular employers' choose reimbursement method, advance discharged. Our reenforced observation took dissent errs states, authority, "layers exhausted system." Post, 422, 4. Certainly, modeled, rates. 2-3 (1933). addition, principled limiting violating Equal Protection argue infliction injunction. reject assumes context: "[W]e unwilling assume general lack sensitivity obligation safeguard personal liberties uphold law." Stone Powell, 428 465, 494, 35, 96 3037, 3052, 1067 indispensable compelled submit reason, Appellants error premise; demonstrates, litigate none jurisdictional restricting disregarding (b). Such suggestion untenable since, comply consequently identically worded appellees. Alternatively, affect doubts injured FUTA's single judge three-judge contrast, Similarly, defendants' reliance Williams Zbaraz, 448 358, 2694, 831 misplaced. challenged. issue, exceeded issue. 367, 2700. "review 'whole case.' 368, restricted vacated portion Ibid. "Any irony Labor, certainly defendant party, remove just that. implicated favor followed whereby available. independent why When compares layers system surely present.

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