Court Opinion

ID: 883877
Source: CourtListenerOpinion
Date Created: 2013-06-05 02:43:33.707174+00
Date Added: 2024-06-11T08:50:51.967302
License: Public Domain

No.      95-172
            IN THE SUPREME COURT OF THE STATE OF MONTANA
                                             1995

APPEAL   FROM:     District  Court of the               First   Judicial    District,
                   In and for the County                of Lewis and Clark,
                   The Honorable   Dorothy              McCarter,     Judge presiding.

COUNSEL OF RECORD:
            For   Appellant:
                   Michael      B. Austin,          Hardin,     Montana
            For   Respondent:
                   Joseph    P. Mazurek,          Attorney    General,     Sarah Bond,
                   Assistant    Attorney        General,   Helena,   Montana;      Nick A.
                   Rotering,     Montana         Department      of   Transportation,
                   Helena,    Montana

                                           Submitted          on Briefs:    July   28,   1995
                                                                Decided:    November     13,    1995
Filed:
Justice          William          E.       Hunt,            Sr.,        delivered               the       Opinion            of     the      Court.

          Plaintiff              and appellant,                         Candy          Carter          appeals             a decision              and
order       from          the       First              Judicial              District                Court,         Lewis            and         Clark

County,            granting                 the            defendant,                   the          Montana              Department                 of

Transportation,                   summary                 judgment               based        on the          appellant's                  lack      of

standing.

          We affirm.

          The       sole         issue               on         appeal           is     whether               the        District                Court
properly           granted            the        Montana               Department               of     Transportation                      summary

judgment.
                                                                        FACTS

          The       appellant,                   Ms.            Carter,           is      an         enrolled             member            of     the

Chippewa-Cree                   Tribe           of        the      Rocky          Boy     reservation.                            She and          her
partner          own and operate                       the        "Pastime,"              a retail             gas and convenience

store       located             outside              of      Box       Elder.             Carter            possesses               a business

license          issued          by        the       Chippewa-Cree.                          She is           not        licensed           by the

State       of     Montana             as a gasoline                         distributor,                   nor     is      she      an Indian

Trader       licensed             by the               Bureau           of       Indian         Affairs.                 Carter           receives

her     gas from           the      Montana               Refining               Company             (MRC).         MRC is          a resident

motor       fuel         distributor                   out        of    Great          Falls.

          The record                is      unclear                as to         when Ms.              Carter            first           contested

the     motor         fuel        tax,           but       the         State          does         have      a letter               of     protest

from      July        1991.           At    that           time,          Carter          applied            for     a tax          refund          for

all      gasoline            sold          at        her         gas      station             in      the      years             1988      through

1990.              The       request                 was         denied           by      the         Montana              Department                 of

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Transportation                (MDT), so Carter                 then filed               an appeal              with       the State
Tax Appeal Board.                She did              not complete               this        appeal           procedure.
         On October            6, 1992, appellant                      filed       an action                  against        the MDT
seeking       declaratory             and injunctive                   relief       to have the court                        declare
the       State         was      without              jurisdiction                 to         require               either            the
distributor             or     her     to       pay the         motor           fuel         tax.             Appellant           also
requested         a refund           of the taxes               paid          between         1988 and 1992.
          In her        complaint,              Carter        alleged           the State's                   motor        fuel       tax
was unconstitutional                           as     applied            to     sales         to        Indian            retailers
(Tribal       members) inside                   the boundaries                  of the Rocky Boy reservation
because        such      sales        are           preempted          by federal                  law.           The District
Court      granted           defendant's              motion        for       summary judgment.
                                                          DISCUSSION
         Our      standard           of        review        on a grant                 of     summary judgment                        is
identical          to    that        of     a trial           court.             Minnie            v.     City        of     Roundup
(1993),        257 Mont. 429, 431,                 849 P.2d 212, 214. Summary judgment                                         is
proper      only        when no genuine                    issue       of material                 fact        exists        and the
moving        party      is     entitled              to     judgment           as a matter                    of     law.        Rule
56(c),      M.R.Civ.P.           Courts             use summary judgment                      to encourage                 judicial
economy through                 the       elimination               of        unnecessary                trial,           delay       and
expense.        Engebretson               v. Putnam (1977),                     174 Mont. 409, 571 P.2d 368.
          The District               Court          granted        summary judgment                        in favor           of the
defendant          for        lack        of        the     requisite            standing                to       bring       such       a
challenge.               Initially,                 we acknowledge                  that           a taxpayer                who is
directly          and adversely                 affected           by an assessment                       or levy          of taxes

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has the           necessary              standing                to challenge                     such        a tax.            state           ex 7x1.
Conrad          v.      Managhan           (1971),               157 Mont. 335,        338,       485 P.2d 948,           950.

               Outside         these       special               circumstances,                        the       standing            requirement

for        a      party          challenging                     the         validity                  of        statutes              is           firmly
established.                   We have held                   that       standing                 is     the        "threshold                 of    every

case,           especially                 those              where               a    statutory                    or       constitutional
violation               is    claimed            to       have        occurred.               . . .'I             Olson         v.    Department
of     Revenue,              223 Mont. 464,       469,          726 P.2d 1162,         1166.            The           injury
alleged           must        be personal                 to the         plaintiff,                    as distinguished                         from         an

injury            suffered            by     the           community                  in     general.                    Warth            v.        Seldin

(1975),              422 U.S. 490,            502,       95 S.Ct.2197,                         45 L. Ed. 343.

           In        this     case,        Carter             contends                she was personally                             affected                by

the      tax         because         the     tax          affects             her      distributor,                      who then               imposes

the      tax         on her,          which            she       in     turn          imposes               on her           customers.                   The

District              Court      concluded                 Carter        was not personally                              aggrieved                  by the

gasoline              tax.       The court                found         whether             Carter            was personally                        harmed
by       the          gasoline             tax            statutes                depended                  on      where            the            "legal

incidence"                  of the     tax        fell.            The concept                    of legal              incidence               differs

from        the         question           of         where            the        economic                  burden         falls.                   United

States          v.      Delaware           (3rd           Cir.         1992),          958 F.2d 555,      561.

           Shortly            before         this            case       was submitted                         on briefs,              the           United

States          Supreme           Court          decided               a case          discussing                   "legal           incidence."

The Court               considered               the       taxing            authority                 of     the       State        of        Oklahoma

over        the        Chickasaw             Nation,               specifically                        whether           the         state           could

impose          a motor           fuel       excise              tax     upon          fuel            sold       by Chickasaw                      Nation

retail          stores           on Tribal                 trust             land.           Oklahoma                Tax        Commission                   v.

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Chickasaw             Nation              (1995),          ~            U.S.                       ,     115 S. Ct. 2214,        132
L. Ed. 2d 400.            In     that         case      the         Court           held,            ' [tlhe             initial            and
frequently              dispositive                 question            in      Indian             tax        cases          .      .       . is     who

bears        the      legal         incidence            of     a tax."               Chickasaw,                    115 S.Ct                at     2220.

         As part              of    its         analysis         the         Court          looked             at     the         language             of

the     Oklahoma              statute.              The        relevant              statute             in      that        case            did     not

expressly             identify             who was to bear                     the        legal         incidence                 of        the     tax,

whether         it     was the            distributor,                the      retailer,                 or consumers;                       nor     did

the     statute           contain            a "pass           through"              provision.                     A "pass                 through"

provision             would         require            distributors                  and retailers                      to        pass           on the
cost     of     the       tax      to     the     consumer.               Chickasaw,                   115 S.Ct              at      2221.           The
Oklahoma             statutes             were      found        to     have         ensured              that        the         distributer

was      not         burdened              with         the      tax;          distributors                         acted            merely            as

"transmittal                agents         I' for      taxes         imposed          on the             retailer.                  Chickasaw,
115 S. Ct.          at       2222.             The      incidence                 of      the         tax         rested              with        the

retailer.                 Accordingly,                  since          the      retailer                 was         Tribal,                 the     tax
infringed            upon the             right        of Tribal             self         government.                   See,         e.g.          Bryan

v.     Itasca         County            (1976),          426 U.S. 373,         96 S. Ct. 2102,           48 L. Ed. 2d
710.

         Montana            differs             from     Oklahoma              in     this        respect.               In Montana                  the
relevant             statute            concerning             the      gasoline               tax        reads         as follows:

            15-70-204.        (Temporary)       Gasoline   license     tax - rate.     (1)
            Every      distributor        shall     pay   to     the    department      of
            transportation          a license        tax   for     the    privilege     of
            engaging      in and carrying        on business      in this     state in an
            amount equal to:
                . .

                     lb)           for    each    gallon                        of     all                other   gasoline
            distributed               by the distributor                         within                the state.        .

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                    (i)           24 cents           per gallon                 beginning            July            1, 1993;            and

                    (ii)          27 cents            per     gallon             beginning                 July           1,     1994.

The      statute                clearly             states           the          tax          is         to         be         paid      by       the
distributor.                    The distributor                     is         defined          in    the            statutes            as:

          (6)      "Distributor"        means:
                    (a)     any person who engages in the business                     in
                   this         state       of       producing,            refining,
                   manufacturing,         or compounding             gasoline        for
                   sale,     use, or distribution;
                    (b)     any person who imports           gasoline      for sale,
                   use, or distribution;
                    (c)     any person     who engages         in the wholesale
                   distribution        of gasoline          in this      state       and
                   chooses        to  become      licensed       to    assume        the
                   Montana state        gasoline      tax liability;
                    Cd) any exporter            as defined         in subsection
                    (8) ;
                    (e)     any dealer       licensed        as of January             1,
                   1969,       except    a dealer          at    an established
                   airport;
                    (f)     any person     in Montana who blends               alcohol
                   with     gasoline.

Therefore,           anyone              who distributes                       gas and licenses                           themselves              as a

distributor                is      subject           to     the      tax.              In   this           case           the      retailer         is

not     burdened                with         the     tax      because                 Carter         is         not        a distributor.

Since      the     dispositive                     language              in Montana's                statute                   clearly         places

the     burden        on the             distributor,                    the     legal         incidence                  of      the    tax      does

not     fall       on Carter.                      Since      Carter             is     unable             to        show         she    has      been

personally            affected                by this             tax,         she lacks             the         necessary               standing

to pursue           this          claim.            Therefore              summary             judgment                was appropriate.

               We affirm               the    District             Court's             granting                 of     summary           judgment

based          on the           appellant's                lack      of        standing.

          Affirmed.
    We Concur:

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I
Justice          James C. Nelson                     specially           concurs.

          I     concur           with         the     result        of       our        decision         but       not             in     our
analysis.               In determining                 whether          Carter          was personally                injured              by
the gasoline                 tax,       we analyze             where the legal                   incidence            of the tax
falls.          Although              the United           States        Supreme Court noted                      in Chickasaw
that      often            the      dispositive               question            in     Indian         tax      cases             is     who
bears         the legal             incidence          of the tax,                the legal        incidence                analysis
goes       to        the     merits           of     the       taxation            issue.          Chickasaw                  did         not
involve          a standing              issue,        and thus,             properly          resolved           the taxation
issue         presented               there     on the basis                 of a legal           incidence              analysis.
In the          instant          case,        we need not and should                          not reach            the merits,
but need only                affirm           the District          Court's              grant     of summary judgment
based on Carter's                       lack of standing.                    Therefore,            we    should            limit          our

analysis             to standing              and should          not implicitly                   reach        the      merits            of
Carter's             claims           by addressing             the legal               incidence         of the tax.
          The         sole        issue         on      review          is     whether            the         District                  Court
properly             granted            summary judgment                     to        the    Montana          Department                  of
Transportation.                          The        District         Court             granted          summary             judgment
because it                found that           Carter         did not have standing                       to challenge                    the
validity             of     Montana's               gasoline        license             tax      as applied              to         Indian
retailers             inside           the boundaries               of the Rocky Boy Reservation.
          Standing               is     a justiciability                      doctrine           designed             to       control
access          to     the       judicial            system       by determining                   who is          entitled                 to
have          a case          adjudicated.                     See Olson               v.     Department              of       Revenue

 (1986),         223 Mont. 464, 469-70,                          726 P.2d 1162, 1166.                          Originating                  in
Article          VII,        section            4 of the Montana Constitution,                                    the        standing
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doctrine         limits        judicial      power to "cases at law and equity."                                         This
Court       has interpreted               "cases         at law and equity"                 to embody the same
limitations            as the Article              III        "case or controversy"                     provision          in
the United           States        Constitution.                Olson, 726 P.2d at 1166;                     Stewart
v. Bd. of Cty.              Comm'rs of Big Horn Cty.                        (1977),        175 Mont. 197, 201,
573 P.2d 184,               186.
         The fundamental               aspect          of standing           is that         it      focuses        on the
party         seeking        to get       a complaint               before      a court             and not         on the
issues         the     party       wishes         to     have       adjudicated.                   Flast      v.     Cohen
(1968),         392 U.S. 83, 99, 88 S. Ct. 1942, 1952 , 20 L. Ed. 2d 947, 961.
Courts         approach        standing       in two ways.                  The first             approach         focuses
on      the      constitutional              provisions               of     standing             and       the     second
approach         focuses        on the prudential                   restrictions             that       courts      use to
preserve         judicial          credibility             and to deny standing.                            Olson, 726
P.2d at         1166;       Valley        Forge        Christian           College        v. Americans              United
for     Separation           of Church and State                      (1982),       454 U.S. 464,        475,     102
S. Ct. 752,    760,     70 L. Ed. 2d 700,        711.
         At     a minimum,           the     constitutional                  provisions             require         that        a
plaintiff            be personally            injured           or be threatened                    with      immediate
injury          by    the      alleged        constitutional                   or        statutory           violation.
m, 726 P.2d at 1166-67;                    Chovanak v. Matthews                       (1948),     120 Mont.
520,      526-27,         188 P.2d 582,                585.        Thus,     at the threshold                     of every
case,          especially            those        where         a      statutory            or       constitutional
violation            is alleged        to have occurred,                    is the requirement                    that     the
plaintiff            allege        "such     a personal                stake        in     the      outcome         of     the
controversy             as to assure          that        concrete           adverseness             which        sharpens

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the presentation                     of issues."           Northern          Border             Pipeline      Co. v. State
(1989),         237 Mont. 117,        129,    772 P.2d 829,                  836; Olson, 726 P.2d at
1166       (quoting        Baker            v.     Carr     (1962),          369 U.S. 186,      204,      82 S. Ct.
691,      703, 7 L. Ed. 2d 663, 678).              This personal                    stake     requirement           is
dispositive.               If        a party        seeking         review          is not among the                  injured,
that     party       is not entitled                     to judicial           review.             Olson, 726 P.2d at
1166-67         (citing         Sierra           Club v. Morton              (1972),            405 U.S. 727, 734-35,
92 S. Ct. 1361,          1366,           31 L. Ed. 2d 636,      643);           but      see Grossman v.
State,       Dept.        of Natural               Resources           (1984),            209 Mont. 427,       438-39,
682 P.2d 1319,            1325         (holding         that        in        special           circumstances,
presenting           issues            of        an urgent          nature,              this      Court      will        accept
original         jurisdiction                    and drape      the taxpayer                    with     standing).
          For      example,              in        Olson,          the        appellants                 challenged            the
constitutional                  validity           of     certain         statutes               that      require       county
residence         to obtain             benefits           such as obtaining                     a fishing         or hunting
license         or running            for        county     office.          The appellants                 were citizens
of Montana but did not live                               within         any county               boundaries.            w,
726 P.2d at 1166.                      We held that             the appellants                    did not allege              that
the      statutes          injured                them     personally               or      threatened             them       with
immediate           injury.              Therefore,             they         did         not      meet      the      threshold
requirement            of a personal                 stake      in the outcome of the controversy.
          Similarly,             Carter          challenges           the constitutional                     validity         of a
statute         imposing             a gasoline             license          tax.          See 5 15-70-204,                   MCA.
That      statute         requires               every     distributor              to pay a license                    tax    for
the      privilege              of     engaging            in   and       carrying                on business             within
Montana.          Importantly,                    the tax does not apply                         to a retailer.               As a

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retailer,       Carter         was not among the injured              and thus        cannot      allege
a personal          injury.            Because    she has not          alleged       the     requisite
personal       stake      in     the    outcome     of    the   controversy,          she is      not         a
proper      party    before       the court.
         Where the legal           incidence       of the tax        falls      is   immaterial         for
purposes       of    resolving          the    standing      issue    in     this    case,     and our
decision      to affirm          should       not be grounded        in analysis        that    is more
appropriately          directed         to the merits       of the taxation           issues      raised
by Carter's         complaint.          Accordingly,        I specially        concur      o ly in the
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result      of our opinion.

Justice    Terry         N.      Trieweiler        concurs      in    the      foregoing        special
concurrence.

                                                                              Justice

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