Court Opinion

ID: 859084
Source: CourtListenerOpinion
Date Created: 2013-04-25 17:08:54.241545+00
Date Added: 2024-06-11T13:22:09.048883
License: Public Domain

Filed 4/25/13

      IN THE SUPREME COURT OF CALIFORNIA

JOHN W. McWILLIAMS,                  )
                                     )
           Plaintiff and Appellant,  )
                                     )                            S202037
           v.                        )
                                     )                      Ct.App. 2/3 B200831
CITY OF LONG BEACH,                  )
                                     )                      Los Angeles County
           Defendant and Respondent. )                    Super. Ct. No. BC361469
____________________________________)

        Code of Civil Procedure section 313 provides that the “general procedure”
for the presentation of claims for money or damages against a local government
entity is prescribed by the Government Claims Act (Gov. Code, § 810 et seq.). In
Ardon v. City of Los Angeles (2011) 52 Cal.4th 241, 251 (Ardon), we held that the
Government Claims Act permits a class action claim by taxpayers against a local
government entity for the refund of an unlawful tax “in the absence of a specific
tax refund procedure set forth in an applicable governing claims statute.” In the
case now before us, the defendant local government entity asserts that its
municipal code contains an “applicable governing claims statute” barring class
action claims for a tax refund. We find that a local ordinance is not a “statute”
within the meaning of the Government Claims Act and therefore affirm the Court
of Appeal.
                                      BACKGROUND
        The current dispute arises out of a class action lawsuit filed in November
2006 by plaintiff John W. McWilliams, a resident of defendant City of Long

                                          1
Beach (the City), filed on behalf of himself and similarly situated individuals
challenging the City‟s telephone users tax (TUT) and seeking refund of the taxes
paid. McWilliams asserts that Long Beach Municipal Code section 3.68.50,
subdivision (d) exempted from the TUT all amounts that “are exempt from or not
subject to” the federal excise tax on telephone service and that the City has for
some time mischaracterized the charges subject to the federal excise tax.
       The particulars of the mischaracterization are not at issue in this
proceeding. It is enough for our purposes to relate that the Internal Revenue
Service, following several adverse court decisions, announced in 2006 that it
would cease collecting the federal excise tax on long distance and bundled
services and allow federal taxpayers to obtain a refund by checking a box on their
federal tax returns. In August 2006, McWilliams served a demand on the City and
its officers to refund the money he asserted that the City had improperly collected
on certain telephone services “during the prior two years.” The City did not
respond. Instead, in September 2006, the City Council amended its TUT
ordinance to remove any reference to the federal excise tax—but did so without
seeking the approval of the voters under article XIII C of the California
Constitution, commonly known as Proposition 218. The complaint alleges that the
City unlawfully collected and continues to collect the TUT “on services that have
been conclusively determined to be non-taxable under the Federal Excise Tax.”1
       The class action complaint asserted six causes of action: (1) declaratory
and injunctive relief challenging the collection of the TUT; (2) declaratory and

1       In November 2008, after the complaint was filed, voters in Long Beach
approved Measure G, which allowed the City to apply its tax to all charges for
intrastate, interstate, and international telephone communication services.
McWilliams does not challenge in this proceeding the collection of the TUT as
authorized by Measure G.

                                          2
injunctive relief challenging the City Council‟s amendment to the TUT ordinance;
(3) money had and received; (4) unjust enrichment; (5) a violation of due process
because of the City‟s failure to provide either a pre-deprivation or post-deprivation
remedy; and (6) a writ of mandate requiring the City to provide a pre-deprivation
or post-deprivation remedy. The City demurred to the complaint, arguing (among
other things) that Long Beach Municipal Code sections 3.48.060 and 3.68.160
disallow class claims for a refund. The trial court ruled that class claims for a
refund were barred under Woosley v. State of California (1992) 3 Cal.4th 758, and
sustained the demurrer with leave to amend. When McWilliams stated he would
not be amending his complaint, the trial court entered an order dismissing the case.
         The Court of Appeal stayed the appeal for three years pending this court‟s
resolution of Ardon. In Ardon, we explained that Woosley v. State of California,
supra, 3 Cal.4th 758, had not erected a categorical bar to class claims for a tax
refund: “All that Woosley demands is that a court first examine the claims statutes
at issue in a claim for a taxpayer refund to determine whether the Legislature
contemplated a class claim under the applicable California code.” (Ardon, supra,
52 Cal.4th at p. 251.) Woosley did not analyze the applicability of Government
Code section 910.2 Ardon, on the other hand, did address the applicability of
section 910 and held that class claims for tax refunds against a local governmental
entity are permissible under section 910 “in the absence of a specific tax refund
procedure set forth in an applicable governing claims statute.” (Ardon, supra, 52
Cal.4th at p. 253.)
         After lifting the stay, the Court of Appeal held that “[t]he City is not
authorized under the Government Claims Act to establish its own claims

2        Further statutory references are to the Government Code unless otherwise
noted.

                                            3
procedure for TUT refunds” and that “McWilliams can file a class claim for a
TUT refund” under Ardon, supra, 52 Cal.4th 241. Accordingly, the Court of
Appeal reversed the trial court‟s order with respect to the first, second, third, and
fourth causes of action.
       We granted the City‟s petition for review to decide (1) whether the
exception to the Government Claims Act for “[c]laims under . . . [a] statute
prescribing procedures for the refund . . . of any tax” in section 905, subdivision
(a), excludes local charter provisions and ordinances prescribing procedures for a
tax refund; (2) if so, whether the application of the Government Claims Act to
local tax refund claims violates the home rule taxing power of charter cities; and
(3) whether article XIII, section 32 of the California Constitution requires that a
tax refund proceeding be expressly authorized by the legislative body of the local
government entity.
                                        DISCUSSION
       The Government Claims Act (Act) “established a standardized procedure
for bringing claims against local governmental entities.” (Ardon, supra, 52
Cal.4th at p. 246; see Stats. 1959, ch. 1724, § 1, p. 4133, enacting former § 700 et
seq.; now § 900 et seq.) The purpose of the Act “is to provide the public entity
sufficient information to enable it to adequately investigate claims and to settle
them, if appropriate, without the expense of litigation.” (City of San Jose v.
Superior Court (1974) 12 Cal.3d 447, 455.) On August 11, 2006, prior to filing
this class action, McWilliams served a demand on the City in the form of a letter
on behalf of himself and all similarly situated taxpayers seeking a refund of the
TUT. The question in this appeal is whether McWilliams was entitled to present
this claim on behalf of the entire class or, instead, whether each member of the
putative class must present an individual claim prior to filing suit.

                                           4
       According to the Act, “all claims for money or damages against local
public entities” are to be presented “in accordance with Chapter 1 (commencing
with Section 900) and Chapter 2 (commencing with Section 910),” except as
provided in section 905. (§ 905.) One of the exceptions in section 905 is for
“[c]laims under the Revenue and Taxation Code or other statute prescribing
procedures for the refund . . . of any tax . . . or any portion thereof . . . .” (§ 905,
subd. (a).) When a claim is excepted from the Act by section 905 and is “not
governed by any other statutes or regulations expressly relating thereto,” the claim
“shall be governed by the procedure prescribed in any charter, ordinance or
regulation adopted by the local public entity.” (§ 935, subd. (a).)
       We discussed the operation of these provisions in Ardon. The claim in
Ardon, like the claim here, involved a class action lawsuit for refund of a TUT, but
(unlike the City here) the defendant City of Los Angeles did not identify any
municipal ordinance that prescribed procedures for a refund of the tax. (Ardon,
supra, 52 Cal.4th at p. 246, fn. 2.) Ardon held that claims for tax refunds against a
local governmental entity, including class claims, are permitted by section 910 “in
the absence of a specific tax refund procedure set forth in an applicable governing
claims statute.” (Ardon, supra, 52 Cal.4th at p. 253.) Because Ardon‟s particular
claim “did not involve any applicable municipal code or statute governing claims
for refunds” (id. at p. 251), we did not decide whether a local charter provision or
municipal ordinance could qualify as a “statute prescribing procedures for the
refund . . . of any tax” within the meaning of section 905, subdivision (a). (See
Ardon, supra, 52 Cal.4th at p. 246, fn. 2.)
       In this case, the City contends that class actions seeking refunds of its local
taxes are excepted from the Act by Long Beach Municipal Code sections

                                            5
3.48.0603 and 3.68.160,4 which assertedly bar class actions for refunds. Whether
the claim here is excepted from the Act thus depends on whether it is a “[c]laim[]
under . . . [a] statute prescribing procedures for the refund . . . of any tax . . . .”
(§ 905, subd. (a), italics added.) The City argues that an ordinance qualifies as a

3       Long Beach Municipal Code section 3.48.060 provides:
        “The refund may be made to the person who paid the money under any of
the following conditions:
        “A. If the amount paid is one thousand dollars ($1,000.00) or less and if
the department head to which the money was paid authorizes the refund in
accordance with prior written authorization of and subject to conditions imposed
by the city manager;
        “B. If the amount paid is ten thousand dollars ($10,000.00) or less and if
the department head to which the money was paid, with the approval of the city
attorney, authorizes the refund; provided, however, that refunds of one thousand
dollars ($1,000.00) or less made in accordance with the provisions of Subsection
A. of this section shall not require the approval of the city attorney;
        “C. If the amount paid is more than ten thousand dollars ($10,000.00) and
the department head to which the money was paid, with the approval of the city
attorney and the city council, authorizes the refund.”
4       Long Beach Municipal Code section 3.68.160 provides:
        “A. Whenever the amount of any tax has been overpaid or paid more than
once or has been erroneously or illegally collected or received by the city clerk or
city treasurer-city tax collector under this chapter, it may be refunded as provided
in this section.
        “B. A service supplier may claim a refund or take as credit against taxes
collected and remitted the amount overpaid, paid more than once, or erroneously
or illegally collected or received, when it is established in a manner prescribed by
the city treasurer-city tax collector that the service user from whom the tax has
been collected did not owe the tax; provided, however, that neither a refund nor a
credit shall be allowed unless the amount of the tax so collected has either been
refunded to the service user or credited to charges subsequently payable by the
service user to the person required to collect and remit.
        “C. No refund shall be paid under the provisions of this section unless the
claimant established his or her right thereto by written records showing
entitlement thereto.
        “D. No refund shall be paid under the provisions of this section unless the
claimant has submitted a claim pursuant to this section.”

                                             6
“statute” within the meaning of section 905, subdivision (a). McWilliams, on the
other hand, contends that the word “statute” in this provision is limited to laws
enacted by the Legislature, Congress, or the People.
       The Legislature has provided definitions of many of the terms in the Act,
including “statute.” These definitions govern the construction of the Act “[u]nless
the provision or context otherwise requires.” (§ 810.) We therefore turn to section
811.8, which defines a “statute” as “an act adopted by the Legislature of this State
or by the Congress of the United States, or a statewide initiative act.” This
definition, as the City concedes, excludes local charters and ordinances. (Cf.
Societa per Azioni de Navigazione Italia v. City of Los Angeles (1982) 31 Cal.3d
446, 463 [provision of the Act limiting immunity of a public entity to that
“provided by statute” (§ 815) “does not include local ordinances or regulations”].)
The City, though, contends that the “context otherwise requires” a more expansive
definition of the term “statute” as used in section 905, subdivision (a)—one that
would encompass local legislation. We disagree.
       When the Legislature intended a broader scope than the statutory definition
of “statute” in section 905, it used broader language. Subdivision (b) of section
905, for example, excepts from the Act “[c]laims in connection with which the
filing of a notice of lien, statement of claim, or stop notice is required under any
law relating to liens of mechanics, laborers, or materialmen,” and subdivision (e)
excepts “claims for any form of public assistance under the Welfare and
Institutions Code or other provisions of law relating to public assistance
programs.” (Italics added.) Had the Legislature similarly intended to except a
broader range of claims in subdivision (a), one assumes it would have used one of
these formulations. (Cf. Zalkind v. Ceradyne, Inc. (2011) 194 Cal.App.4th 1010,
1035 [“When the Legislature intends the word „complaint‟ to include „cross-
complaint,‟ it says so.”].)

                                          7
       Moreover, other parts of the Act reveal that the Legislature understood the
terms “statute,” ordinance,” and “charter” to mean different things. For example,
section 935, subdivision (a) provides that claims against a local entity for money
or damages “which are excepted by Section 905 . . . and which are not governed
by any other statutes or regulations expressly relating thereto, shall be governed by
the procedure prescribed in any charter, ordinance, or regulation adopted by the
local public entity.” Having used these terms for their distinct meanings in one
part of Act, it is unlikely the Legislature intended “statute” to encompass all three
meanings in section 905, subdivision (a).
       Furthermore, interpreting the word “statute” in accordance with the
statutory definition does not render the term meaningless or inoperative in section
905, nor does it lead to absurd consequences. A number of “other statutes,”
outside the Revenue and Taxation Code, prescribe the procedures for the refund of
a local “tax, assessment, fee, or charge.” (Gov. Code, § 905, subd. (a); see, e.g.,
Bus. & Prof. Code, § 5499.14; Elec. Code, § 13307, subd. (c); Gov. Code,
§§ 66001, subds. (d), (e), 66020; Health & Saf. Code, § 5472; Mil. & Vet. Code,
§ 890.3, subd. (b)(2).) It is therefore reasonable to interpret the exemption for
“[c]laims under the Revenue and Taxation Code or other statute prescribing
procedures for the refund . . . of any tax, assessment, fee, or charge” (Gov. Code, §
905, subd. (a)) to encompass only those claims that arise under the Revenue and
Taxation Code or any other statute providing for a refund. Accordingly, neither
“the provision or context otherwise requires” a broader definition of the word
“statute.” (See Gov. Code, § 810.)
       The existence of these other statutes distinguishes the word “statute” in
section 905, subdivision (a) from the word “regulation” in section 935, subdivision
(a). That section provides that claims for money or damages against a local public
entity that are excepted by section 905, and that are not governed expressly by any

                                          8
other statutes or regulations, “shall be governed by the procedure prescribed in any
charter, ordinance or regulation adopted by the local public entity” (§ 935, subd.
(a), italics added)—even though the Act‟s definition of “regulation” encompasses
only regulations promulgated by a state or federal agency. (§ 811.6.) In that
circumstance, where the word “regulation” would otherwise be inoperative (but
see Johnson v. San Diego Unified School Dist. (1990) 217 Cal.App.3d 692, 699
[“Although a school district constitutes a „state agency‟ . . . it is a „local public
entity‟ under the claim-filing requirements of the Act . . . .”]), the context may
require a definition other than the statutory definition. (Hassan v. Mercy
American River Hospital (2003) 31 Cal.4th 709, 715-716.) But that is not the
situation with the word “statute” in section 905, subdivision (a).
       The case law on which the City relies is similarly distinguishable. In those
cases, the Court of Appeal determined that the statutory definition of a given term
“is superseded when it obviously conflicts with the Legislature‟s subsequent use of
the term in a different statute.” (Diamond View Limited v. Herz (1986) 180
Cal.App.3d 612, 618, italics added; see also Boy Scouts of America National
Foundation v. Superior Court (2012) 206 Cal.App.4th 428, 446 [holding that the
word “person” in Code Civ. Proc., § 340.1, subd. (a)(1) should not be interpreted
to include a corporate entity notwithstanding Code Civ. Proc., § 17, subd. (a);
because subdivision (a)(2) and (a)(3) refer to liability “against any person or
entity,” reliance on the statutory definition “would require us to insert the word
„entity‟ in section 340.1, subdivision (a)(1)” or “ignore the word „entity‟ in
subdivision (a)(2) and (3)”]; Watershed Enforcers v. Department of Water
Resources (2010) 185 Cal.App.4th 969, 980 [in determining whether the
Department was a “person” within the meaning of Fish & G. Code, § 2080
notwithstanding Fish & G. Code, § 67, the court relied on the fact that other parts
of the state Endangered Species Act “emphasize[d]” the Act‟s application to

                                            9
public agencies, including a provision exempting public agencies from Fish & G.
Code, § 2080 in certain circumstances; “It is illogical to expressly exempt an
entity from a prohibition that did not apply to it in the first place”]; American
Liberty Bail Bonds, Inc. v. Garamendi (2006) 141 Cal.App.4th 1044, 1054
[provision allowing the Insurance Commissioner to suspend the license of a
“subject person” from employment or participating in the conduct of the business
necessarily applied only to natural persons notwithstanding Ins. Code, § 19;
“otherwise the subdivision does not make sense”].) Interpreting “statute” in
Government Code section 905, subdivision (a) in accordance with the statutory
definition, by contrast, does not present an equivalent conundrum.
       The absence of ambiguity in the statutory language dispenses with the need
to review the legislative history. (People v. Albillar (2010) 51 Cal.4th 47, 56.)
We note, however, that the legislative history does not support the City‟s
contention that the Legislature intended to preserve plenary control by local
governments over the procedures for local tax refunds. (See Volkswagen Pacific,
Inc. v. City of Los Angeles (1972) 7 Cal.3d 48, 62 [“ „statute‟ does not refer to
ordinance . . . unless the context of section 905, subdivision (a), „otherwise
requires.‟ There is nothing in the legislative history to suggest that „statute‟ within
section 905, subdivision (a), is to have a special meaning unique to that
section.”].)
       “As originally proposed, the standardized procedures of the Act embodied
in Government Code section 910 would not have applied to „[c]laims under the
Revenue and Taxation Code or other provisions of law prescribing procedures for
the refund . . . of any tax . . . .‟ ” (Ardon, supra, 52 Cal.4th at p. 247, quoting
Recommendation and Study relating to The Presentation of Claims Against Public
Entities (Jan. 1959) 2 Cal. Law Revision Com. Rep. (1959) p. A-12 (1959 Study).)
The Law Revision Commission reasoned that for tax refund claims, as with claims

                                           10
required by the mechanics‟ and materialmen‟s lien laws and claims for aid under
public assistance programs, “the basic objectives of early investigation to prevent
litigation and discourage false claims which support a uniform procedure for tort
and inverse condemnation claims are not applicable; and orderly administration of
the substantive policies governing the enumerated types of claims strongly
suggests that claims procedure should be closely and directly integrated into such
substantive policies. Obvious and compelling reasons appear for gearing tax
refund claims to assessment, levy and collection dates and procedures;
establishing special modes for protecting mechanics and material suppliers on
public projects; [and] providing an uncomplicated routine procedure for
processing the tremendous volume of salary, pension, workmen‟s compensation
and public assistance claims . . . .” (1959 Study, supra, 2 Cal. Law Revision Com.
Rep., at p. A-117.)
       Had the Legislature actually enacted the version proposed by the Law
Revision Commission, we could conclude that charters and ordinances concerning
refunds of local taxes clearly fall within the category of “ „[c]laims under the
Revenue and Taxation Code or other provisions of law prescribing procedures for
the refund . . . of any tax . . . .‟ ” (Ardon, supra, 52 Cal.4th at p. 247.) But as we
recently observed in Ardon, supra, 52 Cal.4th at page 247, “the Legislature
specifically rejected this proposal and instead enacted former section 703,
subdivision (a) (now § 905, subd. (a)), which exempted from section 910 „[c]laims
under the Revenue and Taxation Code or other statute prescribing procedures for
the refund . . . of any tax . . . .‟ (Stats. 1959, ch. 1724, § 1, pp. 4133-4134, italics
added.)” The significance of the Legislature‟s rejection of the commission‟s
proposed language concerning tax refund claims is accentuated by the fact the
Legislature, in other subdivisions of former section 703, enacted verbatim the
commission‟s language concerning claims relating to mechanics‟ liens as well as

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the commission‟s language concerning claims relating to public assistance.
(Compare 1959 Study, supra, 2 Cal. Law Revision Com. Rep. at p. A-12 with
Stats. 1959, ch. 1724, § 1, p. 4134.) That the Legislature retained the
commission‟s language concerning “any provision of law” or “other provisions of
law” in those two subdivisions (Stats. 1959, ch. 1724, § 1, p. 4134) but deleted
equivalent language in the subdivision concerning local tax refunds is probative of
the Legislature‟s intent with respect to claims involving refund of local taxes.
(See California Assn. of Psychology Providers v. Rank (1990) 51 Cal.3d 1, 17 [“
„[t]he rejection by the Legislature of a specific provision contained in an act as
originally introduced is most persuasive to the conclusion that the act should not
be construed to include the omitted provision‟ ”].)
       The City asserts that the change in language between the Commission‟s
recommendation and the actual statutory text is of no concern in that, at the time
former section 703 was enacted, contemporary understanding of the word
“statute” encompassed local charters and ordinances. (See People v. Cruz (1996)
13 Cal.4th 764, 775 [“The words of a statute are to be interpreted in the sense in
which they would have been understood at the time of the enactment”].) As proof
of this contemporary understanding, the City relies on an observation by Professor
Van Alstyne in the accompanying Study Relating to the Presentation of Claims
Against Public Entities: “There seems to be no adequate generic word for
referring collectively to statutes, city charters and ordinances. Since claims are
governed by legal requirements of all three types, the phrases „claims statutes‟ and
„claims provisions‟ are used interchangeably herein to refer to all forms of legal
claim presentation requirements as a class.” (1959 Study, supra, 2 Cal. Law
Revision Com. at p. A-18.) But even if we assume that this represented the
common understanding of the phrases “claims statutes” and “claims provisions” in
1959, those phrases appear nowhere in the Law Revision Commission‟s

                                          12
recommended statutory text, nor do they appear in the Act as enacted in 1959 or in
its current form. Moreover, Professor Van Alstyne‟s contention that no generic
word existed to encompass statutes, city charters, and ordinances is belied by the
Legislature‟s use of the word “enactment” in various statutory provisions in
existence at that time. (See, e.g., Civ. Code, § 1630; Gov. Code, § 22000; cf. Gov.
Code, § 810.6 [“ „Enactment‟ means a constitutional provision, statute, charter
provision, ordinance or regulation”].) As we observed in Volkswagen Pacific, Inc.
v. City of Los Angeles, supra, 7 Cal.3d at page 62, “It would appear that if the
Legislature intended to except all tax refund actions, rather than just those arising
under state law, it would have used „enactment‟ rather than „statute.‟ ” We
therefore do not find Professor Van Alstyne‟s specification of the meaning of
“claims statute” persuasive as to the meaning of “statute” in Government Code
former section 703 or in present section 905.
       For the same reasons, we are not persuaded by the City‟s reliance on a
smattering of cases from the 1950‟s, all from a single panel of Division One of the
First Appellate District, that used “claims statute” or “claim statute” to encompass
San Francisco claiming ordinances. (See Parodi v. City & County of San
Francisco (1958) 160 Cal.App.2d 577, 580; Cruise v. City & County of San
Francisco (1951) 101 Cal.App.2d 558, 562; Germ v. City & County of San
Francisco (1950) 99 Cal.App.2d 404, 414.)
       When considered in light of the legislative history, the case law is not
supportive of the City‟s construction of section 905, subdivision (a), either. The
City relies on Pasadena Hotel Development Venture v. City of Pasadena (1981)
119 Cal.App.3d 412 (Pasadena Hotel), which declared that section 905,
subdivision (a) excepted all claims for the refund of a local tax, and on Batt v. City
and County of San Francisco (2007) 155 Cal.App.4th 65 (Batt), which relied on
Pasadena Hotel. But Pasadena Hotel was based explicitly on an erroneous

                                          13
premise. The Court of Appeal there asserted that the reference in section 905,
subdivision (a) to claims for a tax refund under “ „the Revenue and Taxation Code
or other statute‟ is not a limitation upon the type of tax claims excepted from the
coverage” of the Act, in that “the Law Revision Commission ha[d] stated that it
excluded from the scope of the unified claims statute then proposed by the
Commission all „claims for tax exemption, cancellation or refund‟ ” and this
subdivision was “enacted in the form proposed by the commission,” such that “the
intent of the commission in regard to [its] meaning may be deemed to be the intent
of the Legislature.” (Pasadena Hotel, supra, 119 Cal.App.3d at p. 415, fn. 3.)
The Pasadena Hotel Court was mistaken. As demonstrated above, the Legislature
did not codify the language proposed by the commission with respect to claims for
tax refunds; rather, the Legislature narrowed its scope by substituting “other
statute” for “other provisions of law.” Moreover, not only did the Pasadena Hotel
court ignore the Legislature‟s modification, it never mentioned the presumptively
applicable definition of “statute” set forth in section 811.8.
       Batt, in a rather brief analysis, rejected the taxpayer‟s argument that
Pasadena Hotel was wrongly decided and dismissed as “dictum” our observation
in Volkswagen Pacific, Inc. v. City of Los Angeles, supra, 7 Cal.3d at page 62, that
“ „[i]t would appear that if the Legislature intended to except tax refund actions,
rather than just those arising under state law, it would have used “enactment”
rather than “statute.” ‟ ” (Batt, supra, 155 Cal.App.4th at p. 83 & fn. 10.)
However, Batt, too, failed to acknowledge the Legislature‟s modification of the
Law Revision Commission‟s proposed language concerning tax refunds as well as
the definition of “statute” set forth in section 811.8. Batt did cite two cases that
enforced local ordinances governing tax refund actions, Flying Dutchman Park,
Inc. v. City and County of San Francisco (2001) 93 Cal.App.4th 1129 and Howard
Jarvis Taxpayers Ass’n v. City of Los Angeles (2000) 79 Cal.App.4th 242, but

                                          14
neither case ever considered the argument that the Act applied. Indeed, neither
one even cited sections 811.8, 905, or 910. “ „It is axiomatic that cases are not
authority for propositions not considered.‟ ” (In re Marriage of Cornejo (1996) 13
Cal.4th 381, 388.)
       By contrast, County of Los Angeles v. Superior Court (Oronoz) (2008) 159
Cal.App.4th 353 considered the definition of “statute” set forth in section 811.8 as
well as the views expressed on that issue in Volkswagen Pacific, Inc. v. City of Los
Angeles, supra, 7 Cal.3d 48, and concluded that a county ordinance “is not a
„statute‟ within the meaning of Government Code section 905, subdivision (a) and
therefore does not invoke section 905, subdivision (a).” (Oronoz, supra, 159
Cal.App.4th at p. 361.) For the reasons stated above, we agree with Oronoz. Our
review of the text and legislative history confirms that the applicable definition of
“statute” in section 905, subdivision (a) is that set forth in section 811.8, which
excludes local charter provisions and ordinances. We therefore disapprove
Pasadena Hotel Development Venture v. City of Pasadena, supra, 119 Cal.App.3d
412, and Batt v. City and County of San Francisco, supra, 155 Cal.App.4th 65, to
the extent they are inconsistent with this conclusion.
       The City briefly presents two constitutional arguments in support of local
control over tax refunds notwithstanding the scope of section 905, subdivision (a),
but neither has merit.
       According to the City, charter cities have constitutional authority to “make
and enforce all ordinances and regulations in respect to municipal affairs” (Cal.
Const., art. XI, § 5, subd. (a)), even against inconsistent state laws. The power to
levy local taxes in support of local expenditures, of course, is a “municipal affair.”
(California Fed. Savings & Loan Assn. v. City of Los Angeles (1991) 54 Cal.3d 1,
13.) Yet, as the City acknowledges, the California Constitution also provides that
“[t]he Legislature may prescribe procedure for presentation, consideration, and

                                          15
enforcement of claims against counties, cities, their officers, agents, or
employees.” (Cal. Const., art. XI, § 12.) Section 910 is one such provision, but
the Legislature has set forth other procedures to govern even those local tax refund
actions excepted from section 910, including claims relating to the refund of
property taxes (Rev. & Tax. Code, §§ 5097, 5140), sales taxes (Rev. & Tax Code,
§§ 6932, 6933), and other assessments (e.g., Bus. & Prof. Code, § 5499.14). (See
also Volkswagen Pacific, Inc. v. City of Los Angeles, supra, 7 Cal.3d at p. 62 & fn.
7.) The City urges us, almost in passing, to declare a conflict between these two
constitutional provisions and to favor the home rule power, because “[t]o rule
otherwise is to eviscerate the taxing power our Constitution confers on charter
cities.” But the City‟s proposal ignores our duty to harmonize constitutional
provisions where possible. (City and County of San Francisco v. County of San
Mateo (1995) 10 Cal.4th 554, 563.) A review of the history of these constitutional
provisions reveals that no conflict exists.
       The predecessor version of article XI, section 12 of the California
Constitution stated that “[n]o provision of this article shall limit the power of the
Legislature to prescribe procedures governing the presentation, consideration and
enforcement of claims against chartered counties, chartered cities and counties,
and chartered cities or against officers, agents and employees thereof.” (Cal.
Const., art. XI, former § 10, as adopted Nov. 8, 1960, italics added.) The home
rule power, then as now, was set forth in the same article. (Cal. Const., art. XI,
§ 5; see art. XI, former §§ 6, 8, 8 1/2, 9.) Thus, under the predecessor provision, it
was understood that the home rule power did not limit the power of the Legislature
to prescribe procedures governing claims against chartered local governments,
such as the City. In 1970, the provision was amended to its current form, but the
deletion of the reference to chartered cities, chartered counties, and chartered cities
and counties was not intended to change the scope of the Legislature‟s power with

                                          16
respect to chartered entities. Rather, the intent was to clarify the Legislature‟s
power over “all counties and cities in contrast to existing constitutional provisions
which apply only to charter counties and cities.” (Minutes, Cal. Const. Revision
Com. Meeting of Sept. 14-15, 1967, p. 10; see also Assem. Com. on Const.
Amend., Analysis of Art. XI (Feb. 21, 1968) p. 8 [Section 12 “is intended to
replace existing Section 10 [citation omitted], without any change in meaning”].)
In short, the home rule protections in the Constitution do not limit the
Legislature‟s authority to prescribe procedures governing claims against chartered
local government entities.
       The City argues next that the second sentence of article XIII, section 325 of
the California Constitution “means that the relevant Legislature—the Long Beach
City Council or the City‟s people acting via initiative—must expressly authorize
the class claim if [McWilliams] is to pursue it.” The City‟s argument is
inconsistent with what we said in Ardon: “[E]ven assuming article XIII, section
32 is equally applicable to tax actions against local governments, we have already
determined that section 910 provides the necessary legislative authorization for
class claims of taxpayer refunds against local government entities.” (Ardon,
supra, 52 Cal.4th at p. 252.) Indeed, Ardon went on to conclude that “neither the
explicit language nor the policy underlying article XIII, section 32” barred a class
refund action, notwithstanding the absence of a local charter provision or
ordinance authorizing class refund actions. (Ardon, supra, 52 Cal.4th at p. 252.)

5      Article XIII, section 32 provides: “No legal or equitable process shall issue
in any proceeding in any court against this State or any officer thereof to prevent
or enjoin the collection of any tax. After payment of a tax claimed to be illegal, an
action may be maintained to recover the tax paid, with interest, in such manner as
may be provided by the Legislature.”

                                          17
       Finally, we do not believe that the 10 states6 identified by the City that have
barred or limited class actions for tax refunds compel us to create a similar rule
here. As Ardon makes clear, California has not adopted such a bar—and
McWilliams has identified six other states7 that, like California, allow class action
tax refund claims in various circumstances. In any event, the issue here is not
whether class actions for tax refunds should be permitted, but which level of
government—the state or the local public entity—should define the procedures
governing an action for refund of a local tax. We hold that except as to “[c]laims
under the Revenue and Taxation Code or other statute prescribing procedures for
the refund . . . of any tax,” the Legislature has determined that the Government
Claims Act applies. (§ 905.)

6      Georgia (Ga. Code Ann., § 48-2-35(c)(5)), Missouri (State ex rel. Lohman
v. Brown (Mo.Ct.App. 1997) 936 S.W.2d 607, 610), Nebraska (Boersma v. Karnes
(Neb. 1988) 417 N.W.2d 341, 344), Pennsylvania (Dunn v. Board of Property
Assessment (Pa.Commw.Ct. 2005) 877 A.2d 504, 512), South Dakota (Pourier v.
S.D. Dept. of Rev. & Reg. (S.D. 2010) 778 N.W.2d 602, 605-606), and Tennessee
(Wicker v. Commissioner (Tenn.Ct.App. 2010) 342 S.W.3d 35, 42-43) do not
allow class actions for tax refunds.
       Illinois (Jones v. Department of Revenue (Ill.App.Ct. 1978) 377 N.E.2d
202, 204), Indiana (Ziegler v. Ind. Dept. of State Revenue (Ind.Tax Ct. 2003) 797
N.E.2d 881, 885-889), New York (Neama v. Town of Babylon (N.Y.App.Div.
2005) 796 N.Y.S.2d 644, 646) and Washington (Lacey Nursing Center v. Dept. of
Revenue (Wn. 1995) 905 P.2d 338, 343) require a prior protest or claim by each
individual in the class or some other individualized identification of the tax paid
and reasons why it should be reduced or abated.
7      Arizona (Ariz. Dept. of Revenue v. Dougherty (Ariz. 2001) 29 P.3d 862,
864-865), Colorado (Buckley Powder Co. v. State (Colo.Ct.App. 2002) 70 P.3d
547, 554-555), Kentucky (City of Somerset v. Bell (Ky.Ct.App. 2005) 156 S.W.3d
321, 326-327), Massachusetts (see American Trucking v. Secretary of Admin.
(Mass. 1993) 613 N.E.2d 95, 105), New Jersey (American Trucking Ass’n v. Kline
(1986) 8 N.J. Tax 181, 187-189), and North Carolina (Bailey v. State (N.C. 1998)
500 S.E.2d 54, 73-76) allow class tax refund actions.

                                         18
                                   DISPOSITION
     The judgment of the Court of Appeal is affirmed.
                                                    BAXTER, J.

WE CONCUR:

CANTIL-SAKAUYE, C.J.
KENNARD, J.
WERDEGAR, J.
CHIN, J.
CORRIGAN, J.
LIU, J.

                                     19
See next page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion McWilliams v. City of Long Beach
__________________________________________________________________________________

Unpublished Opinion XXX NP opn. filed 3/28/12, 2d Dist., Div. 3
Original Appeal
Original Proceeding
Review Granted
Rehearing Granted

__________________________________________________________________________________

Opinion No. S202037
Date Filed: April 25, 2013
__________________________________________________________________________________

Court: Superior
County: Los Angeles
Judge: Anthony J. Mohr

__________________________________________________________________________________

Counsel:

Wolf Haldenstein Adler Freeman & Herz, Francis M. Gregorek, Rachele R. Rickert, Marisa C. Livesay;
Chimicles & Tikellis, Nicholas E. Chimicles, Timothy N. Mathews; Tostrud Law Group, Jon Tostrud;
Cuneo Gilbert & Laduca and Sandra W. Cuneo for Plaintiff and Appellant.

Lieff, Cabraser, Heimann & Bernstein, Joy A. Kruse; Lockridge Grindal Nauen, Kate Baxter-Kauf,
Elizabeth R. Odette; and Edward M. Teyssier for Consumer Action, National Association of Shareholder
and Consumer Attorneys and Tax Foundation as Amici Curiae on behalf of Plaintiff and Appellant.

Robert E. Shannon, City Attorney, J. Charles Parkin, Assistant City Attorney, Monte H. Machit, Principal
Deputy City Attorney; Colantuono & Levin, Michael G. Colantuono, Sandra J. Levin,Tiana J. Murillo and
Jon R. Di Christina for Defendant and Respondent.

Dennis J. Herrera, City Attorney (San Francisco), Julie Van Nostern, Chief Tax Attorney, and Peter J.
Keith, Deputy City Attorney, for League of California Cities and California State Association of Counties
as Amici Curiae on behalf of Defendant and Respondent.
Counsel who argued in Supreme Court (not intended for publication with opinion):

Francis M. Gregorek
Wolf Haldenstein Adler Freeman & Herz
750 B Street, Suite 2770
San Diego, CA 92101
(619) 239-4599

Michael G. Colantuono
Colantuono & Levin
300 S. Grand Ave., Suite 2700
Los Angeles, CA 90071-3137
(213) 542-5700