Court Opinion

ID: 9672280
Source: CourtListenerOpinion
Date Created: 2023-08-24 03:51:57.13142+00
Date Added: 2024-06-11T18:16:15.196772
License: Public Domain

ROBERTSON, Judge,
concurring in part and dissenting in part.
The history of the wastewater fee increase that led to this litigation is set out in Beatty v. Metropolitan St. Louis Sewer District, 867 S.W.2d 217 (Mo. banc 1993) (Beatty II). The three plaintiffs in that action, of which this is but another chapter, filed suit on June 17,1992, to enjoin a fee increase taking effect July 1, 1992. For three and one-half years plaintiffs have pursued their belief that they are entitled to a refund of the fees MSD imposed in violation of section 22(a). Those fees amount to $4.00 per month imposed for a period of a single year. As I understand the record, MSD stopped collecting the offending fees on June 30, 1993. Now, after three and one-half years of litigation affecting nearly 420,000 customers of MSD and numerous trips up and down the appellate ladder, the majority holds that this case is about three people and $96.00 — the fees paid by Mr. Beatty and the fee paid by Mr. and Mrs. Walter Droege, his co-plaintiffs. No other person who paid the fee imposed by MSD in violation of the constitution benefits from this litigation. Surely this cannot be what the people intended when they amended the constitution to permit private attorneys general to enforce the constitution.
In November, 1980, the voters of Missouri amended the constitution by adding sections 16-24 (the Hancock Amendment) to article X. The nine new sections of the amendment purport to impose strict limits on the ability of state and local governments to increase taxes. From the plain language of the *798amendment, one could argue that state government cannot increase taxes without a constitutional amendment raising state government’s income limitations, even if the voters approve a referendum authorizing a statutory tax increase. Art. X, § 18. And from the plain language of the amendment it is clear that local government may not raise its taxes, licenses or fees (hereafter tax or taxes) without direct voter approval in advance of the imposition of the government’s tribute. Art. X, § 22(a).
Unfortunately, the plain language of the Hancock Amendment does not tell us the scope of relief a court may afford taxpayers in general when a single taxpayer successfully sues to enforce the amendment. It merely empowers a taxpayer to bring an action “to enforce the provisions of section 16 through 22 ... of this article_” Art. X, § 23.
From the constitution’s silence, the majority concludes that when a taxpayer brings an article X, section 23 action against a unit of local government to enforce section 22, the extent of the relief a court may afford is to declare the tax unconstitutional, enjoin the collection of the tax that violates section 22, award the actual, named plaintiffs in the action a refund of the unconstitutional tax, and enter a judgment against the offending government unit for the plaintiff’s attorneys’ fees. For the Court, these limits on relief apply unless the plaintiffs file a class action suit under Rule 52.08 on behalf of all persons who paid the tax. Persons who paid the unconstitutional tax, but who were not part of the legal action, must bring their own actions to recover their illegally collected tribute if no class action is filed by the original plaintiffs.
Clearly the silence of the Hancock Amendment on this issue leaves the Court in a position to impose any procedural rules it wishes. We sail uncharted waters here. The procedure adopted by the Court is reasonable within the context of the usual course of litigation. But in determining the proper procedural rule under the Hancock Amendment, the intent of the voters in adopting the Hancock Amendment is the polestar. That seems sufficient guidance for me to reach a different conclusion than does the Court: I would not require a class action as a procedural predicate to a refund of taxes to all taxpayers who pay a tax collected in violation of section 22(a).
The Court’s holding ignores the intent of the Hancock Amendment. Worse, it makes the enforcement mechanism set out in section 23 more difficult in some cases and toothless and laughable in this one.
Whatever one wishes to say about the Hancock Amendment, this much is clear: it no longer blithely trusts the ability of the elected representatives of the government to manage the government’s fiscal affairs. Pri- or to the adoption of the Hancock Amendment, the people had given their elected representatives carte blanche authority to raise taxes. The Hancock Amendment revokes that consent and establishes a presumption that government has taken enough from the taxpayers and, as to local government, forbids the government from reaching any deeper into their pocketbooks without the taxpayers’ express approval in advance. Because of its basic distrust of government, it is unlike any other provision of the constitution or the statutes. Therefore, the remedy the amendment admits — a taxpayer suit — must hang like the bloody blade of the guillotine over the Reign of Terror — a constant, deterring reminder of the fate that awaits rulers who ignore the will of the people.
The Court’s opinion thwarts that purpose. It says that a class action is necessary because courts cannot assume that plaintiffs in a section 23 action represent the will of other taxpayers who have paid the unconstitutional tax and who “will be bound by its result” even if they disagree. This conclusion is misguided for at least four reasons.
First, only a taxpayer can bring the suit to enforce the amendment. This limitation assures that the person bringing the suit has an identical factual interest in the action to all other persons who actually paid the tax. Second, the voters’ adoption of the Hancock Amendment created the presumption that taxpayers have a common interest in paying only taxes they approve and, conversely, in not paying those taxes they do not approve. The amendment presumes that common in*799terest extends to actions for refunds of taxes unconstitutionally imposed. Third, taxpayers who want the government to collect the tax need not accept their refund if a taxpayer suit to enforce section 22 is successful. Fourth, a successful taxpayer suit necessarily enjoins the government from further collecting the tax. Even those taxpayers who disagree with the lawsuit are bound by its results prospectively once the plaintiff taxpayers prevail. Mo. Const, art. X, § 3.
The majority embraces the class action because it “facilitates litigation when the number of persons having [an] interest in a lawsuit is so great that it is impractical to join them all as parties” and because “class actions allow the accumulation of many relatively small but meritorious claims into a single suit that otherwise would not be pursued.” [Emphasis added.] As to the former contention, the number of persons who have paid the unconstitutional charge in this case is large — over 420,000. If, however, the Court chooses to read section 23 as permitting representative suits, the first purpose cited by the majority is accomplished without the often messy and always expensive notification requirements imposed by Rule 52.08(c)(2).
As to the latter purpose, this case shows exceedingly well that section 23’s promise of an award of attorneys’ fees in a successful action encourages taxpayers to pursue relatively small, but meritorious claims.
Class actions permit geographically diverse parties to join their common interests in pursuit of a common legal objective. Rule 52.08 advises that a class action is necessary to prevent “inconsistent or varying adjudications with respect to individual members of the classRule 52.08(b)(1)(A).
Taxpayer litigation against local governments is usually geographically confined to the corporate limits of the local government. The facts at issue are inherently identical and the defense offered by the government applies to all potential taxpayer suits to enforce section 22. Therefore, the threat of inconsistent judgments is substantially lessened in taxpayer litigation against local governments because of the nature of the claims made. Indeed very few of the policy arguments advanced in favor of requiring class actions strongly militate in favor of requiring plaintiff taxpayers to proceed with a class action under the Hancock Amendment. Respectfully, it makes little sense to me to require governments to pay the unnecessarily high expenses of a class action suit when the demands on the fiscal resources of the government were sufficiently great as to require the fee increase in the first place.
Indeed, the most curious aspect of the majority’s insistence on applying Rule 52.08 presents a potential outcome that violates the constitution. Under Rule 52.08(c)(2) a potential member of the class may ask the court to be excluded from the class. The judgment of the court does not apply to the excluded member. Id. Because that member is excluded, a declaration that a tax is unconstitutional under section 22 does not apply to that person and the taxing authority may continue to levy the tax as to that person. Yet, article X, section 3, demands that taxes “shall be uniform upon the same class or subclass of subjects within the territorial limits of the authority levying the tax.” Surely the majority cannot intend Rule 52.08 to apply in all its detail. And if it does not, one wonders which components of the rule apply and which do not.
Finally, section 18 requires the state government to refund revenues it collects above the revenue limit the constitution imposes. Art. X, § 18(b). If we are to accept the majority’s conclusion on its face (and ignore the tenuous foundation upon which it rests), we must conclude that a lawsuit to enforce the refund provisions of section 18 will result in refunds only to the named plaintiffs, unless the plaintiffs receive judicial approval to form a class, notify the five million plus taxpayers of this state, and give them an opportunity to exclude themselves from the judgment. Given the clear thrust of the Hancock Amendment, this seems an absurd result.
I see no reason to saddle government with the costs of successful class action lawsuits to enforce the Hancock Amendment. This is particularly so when the much more efficient procedure of permitting the plaintiffs to rep*800resent all person who have paid the unconstitutional tax seems preferred by the amendment itself, if not in its words, at least in its spirit.
With respect, I believe the Court would better serve the taxpayers and the purposes of the constitution by lowering barriers to taxpayers suits, not erecting them in the name of procedural purity.
For the reasons expressed, I respectfully dissent from that portion of the Court’s opinion limiting the refund of the wastewater fee only to the named plaintiffs in this case. I read the Hancock Amendment in general, and section 23 in particular, to permit representative taxpayer lawsuits to result in refunds of taxes imposed in violation of article 22 to all person who paid the unconstitutionally imposed tax. Despite what the majority says in its third footnote, slip op. at-, the manner in which that refund can be accomplished is not before the Court; the majority has made the issue of refunding unconstitutionally collected fees irrelevant for all but three of the nearly 420,000 persons who paid them.
I concur in the Court’s judgment that appellant’s sovereign immunity claim is without merit.

ON MOTION FOR REHEARING

In its motion for rehearing, MSD argues that plaintiffs should not be allowed to recover under § 12 of Ordinance No. 8657 because that ordinance had been declared invalid under the Hancock Amendment. Even if we were to assume that the entirety of Ordinance No. 8657 was nullified, a conclusion strongly contested by plaintiffs, or ignore plaintiffs’ claim that identical refund language appears in the prior rate Ordinance No. 8370, MSD’s argument would still lack merit. MSD cites State ex rel. Cardinal Glennon Memorial Hospital v. Gaertner, 583 S.W.2d 107, 118 (Mo. banc 1979). The holding in Cardinal Glennon does not support MSD’s argument. It defeats it. There the Court explained:
In the past it has been stated that “An unconstitutional statute is no law and confers no rights ... (citations omitted)_ This is true from the date of its enactment, and not merely from the date of the decision so branding it.” State ex rel. Miller v. O’Malley, 342 Mo. 641, 652, 117 S.W.2d 319, 324 (Mo. banc 1938); accord Norton v. Shelby County, 118 U.S. 425, 442, 6 S.Ct. 1121 [1125-26], 30 L.Ed. 178 (1886). The modem view, however, rejects this rule to the extent that it causes injustice to persons who have acted in good faith and reasonable reliance upon a statute later held unconstitutional, e.g. Lemon v. Kurtzman, 411 U.S. 192, 93 S.Ct. 1463, 36 L.Ed.2d 151 (1972); Perkins v. Eskridge, 278 Md. 619, 366 A.2d 21 (Md.1976); Shreve v. Western Coach Corp., 112 Ariz. 215, 540 P.2d 687 (Ariz. banc 1975); Downs v. Jacobs, 272 A.2d 706 (Del.1970). We join the view espoused in Lemon, Perkins, Shreve and Downs.
See also State v. County Court of Greene County, 667 S.W.2d 409, 413 (Mo. banc 1984). Under the facts of this case it would be glaringly unjust to prohibit party plaintiffs from recovering taxes paid under an ordinance that provided for credit-refunds of overpayments, after a successful challenge to the ordinance’s constitutionality.
MSD also argues that we should declare in this action whether all other MSD customers are entitled to class relief. MSD, of course, argues that the other customers are not entitled to relief. Although MSD points out that two separate class action proceedings now have been filed, it ignores the fact that plaintiffs in this proceeding have neither requested to be, nor have been certified as, class representatives for the remainder of the MSD customers, pursuant to Rule 52.08. As our opinion makes clear, it would be improper to adjudicate the rights of individuals to money damages or credit-refunds who are not represented in this lawsuit.
The motion for rehearing is denied.