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01/13/95 JAMES M. SIZEMORE v. OWNER-OPERATOR

January 13, 1995

JAMES M. SIZEMORE, JR., AS COMMISSIONER OF REVENUE, ET AL.
v.
OWNER-OPERATOR INDEPENDENT DRIVERS ASSOCIATION, INC., ET AL.



Appeal from Montgomery Circuit Court. (CV-91-1477).

Thigpen, Judge. Robertson, P.j., and Yates, J., concur.

The opinion of the court was delivered by: Thigpen

THIGPEN, Judge

This is a tax case concerning the constitutionality of Ala. Code 1975, § 40-17-150.

In June 1991, the Owner-Operator Independent Drivers Association Inc., et al. (Association) filed a class action challenging the constitutionality of Ala. Code 1975, § 40-17-150, a provision of Article 3 entitled "Motor Carrier Fuel Tax." The action was filed against James M. Sizemore, Jr., Commissioner of the Alabama Department of Revenue, and other state officials (collectively referred to as Sizemore). Inter alia, the Association alleged that the statute imposed a tax on foreign motor carriers, referred to as a marker tax, which, it alleged, is an unconstitutional burden on interstate commerce and violates the Association's rights under several provisions of the United States Constitution. The Association requested a declaratory judgment holding that § 40-17-150 is unconstitutional and void; a permanent injunction against the collection of the tax; an order directing a refund of previously collected taxes, with interest; and attorney fees and costs.

The Association's motion to escrow the tax proceeds collected, pursuant to the statute, was granted. The trial court also granted class action certification pursuant to Rule 23, A.R.Civ.P. The trial court granted the Association's motion for a partial summary judgment on the issue of liability, and it concluded that the marker tax statute and its enforcement violate the Commerce Clause and the Privileges and Immunities Clause of the United States Constitution, and 42 U.S.C. § 1983. Subsequently, the trial court also granted the Association's motion for a partial summary judgment on the issue of the appropriate remedy, and, inter alia, enjoined Sizemore from collecting the marker tax and awarded the members of the class a refund on marker taxes paid. Ultimately, the trial court made these orders final, pursuant to rule 54(b), A.R.Civ.P. Sizemore appealed.

Sizemore raises several issues on appeal: (1) whether § 40-17-150 violates the Commerce Clause of the United States Constitution; (2) whether the marker tax statute violates the Privileges and Immunities Clause of the United States Constitution; (3) whether the trial court erred in certifying this action as a class action; and (4) whether the trial court erred in ordering the tax proceeds held in escrow.

Ala. Code 1975, § 40-17-150, provides for an annual identification marker fee of $12 for certain motor vehicles, including motor vehicles with a capacity for more than 9 passengers and vehicles with more than two axles. Ala. Code 1975, § 40-17-140. A tax on motor carrier fuel used in Alabama is imposed by Ala. Code 1975, § 40-17-141. The proceeds from the marker tax are deposited into the public road and bridge fund. Ala. Code 1975, § 40-17-150(f). Other provisions of the statute address the collection, reporting, and crediting of the tax.

Sizemore first argues that the trial court erred in entering the summary judgment for the Association on its claims that the marker tax violates the Commerce Clause and the Privileges and Immunities Clause of the United States Constitution.

The law regarding summary judgment is well established. A motion for summary judgment tests the sufficiency of the evidence. Such a motion is to be granted when the trial court determines that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. Rule 56, A.R.Civ.P. The moving party bears the burden of negating the existence of a genuine issue of material fact. Melton v. Perry County Board of Education, 562 So. 2d 1341 (Ala. Civ. App. 1990). Furthermore, when a motion for summary judgment is made and supported as provided in Rule 56, the nonmovant may not rest upon mere allegations or denials of his pleadings, but must set forth specific facts showing that there is a genuine issue for trial. Rule 56(e), A.R.Civ.P. Proof by substantial evidence is required. Ala. Code 1975, § 12-21-12; Bass v. SouthTrust Bank of Baldwin County, 538 So. 2d 794 (Ala. 1989). The reviewing appellate court must apply the same standard utilized by the trial court when reviewing a summary judgment. Melton, (supra) . Additionally, the entire record is reviewed in a light most favorable to the nonmovant. Mann v. City of Tallassee, 510 So. 2d 222 (Ala. 1987). A state tax can withstand a Commerce Clause challenge if

"the tax is applied to an activity with a substantial nexus with the taxing State, is fairly apportioned, does not discriminate against interstate commerce, and is fairly related to the services provided by the State."

Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 279, 51 L. Ed. 2d 326, 97 S. Ct. 1076 (1977). The Supreme Court has ruled that a flat-rate Pennsylvania marker fee tax, similar to Alabama's, violated the Commerce Clause. American Trucking Association, Inc. v. Scheiner, 483 U.S. 266, 97 L. Ed. 2d 226, 107 S. Ct. 2829 (1987).

The Association presented as evidence an affidavit of Robert N. Fenili, who had performed statistical studies and had determined that the cost of the marker fee tax was 6 times greater for non-Alabama-based carriers than for Alabama-based carriers; thus, he said, the effect of the statute is to discriminate against interstate commerce. Sizemore presented nothing to dispute the discriminatory effect of the marker fee tax. Since there is no genuine issue of material fact as to whether the statute has a discriminatory effect on interstate commerce, the trial court properly entered the summary judgment for the Association on the basis of a Commerce Clause violation. Having determined this, we pretermit Discussion of the issue regarding the Privileges and Immunities Clause.

Sizemore next argues that the trial court erred in certifying the action as a class action pursuant to Rule 23, A.R.Civ.P. Rule 23(a) sets out ...


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