Vacu-Dry Co. v. County of Sonoma

Opinion

MERRILL, J. Appellant Vacu-dry Company filed this action seeking a refund of property taxes paid in fiscal year 1983-1984, on the ground that respondent County of Sonoma’s assessment procedures violated article XIII A of the California Constitution. The trial court sustained respondent’s demurrer without leave to amend, and we affirm the judgment dismissing the action.

Statement of the Case

The facts in this case are not in dispute. On May 3, 1983, appellant purchased several parcels of real property in the County of Sonoma. For property tax purposes for the fiscal year 1983-1984, that property had been assessed as of the March 1,1983, lien date at a value in excess of $ 14 million; appellant paid the taxes levied, over $146,000, in full.

Appellant had paid less for the property than the March 1, 1983, assessed value. That lower value, approximately $5.7 million, was reflected on the secured roll for the next succeeding lien date, March 1,1984. Appellant filed a claim for a refund of the taxes paid in fiscal 1983-1984. Appellant reasoned that when it acquired the property, assessment of the property should have been immediately reduced on the 1983-1984 secured roll to reflect the purchase price, and the taxes reduced accordingly. The claim was denied by the board of supervisors of respondent County of Sonoma. Appellant then filed the instant action, contending that respondent’s use of the March 1983 valuation in levying taxes for fiscal year 1983-1984 violated article XIII A, section 2 of the California Constitution. Respondent’s demurrer was sustained without leave to amend and the action dismissed, and this appeal followed.

Discussion

In reviewing a complaint against a general demurrer, this court must treat the demurrer as admitting all properly pleaded material facts, but not contentions, deductions, or conclusions of fact or law. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) A trial court does not abuse its discretion in sustaining a demurrer without leave to amend if the complaint fails to [950]state a cause of action and if, under applicable substantive law, there is no reasonable possibility that amendment would cure the defect. (Heckendorn v. City of San Marino (1986) 42 Cal.3d 481, 486 [229 Cal.Rptr. 324, 723 P.2d 64.)

Prior to the adoption of article XIII A by the voters in June 1978, real property was assessed for tax purposes every year according to its value as of the lien date for the upcoming fiscal year. (Rev. & Tax. Code, §§ 401,401.3 [added by Stats. 1970, ch. 144, § 1, p. 390; amended by Stats. 1986, ch. 608]; Schoderbek v. Carlson (1984) 152 Cal.App.3d 1027, 1031 [199 Cal.Rptr. 874].)1 The lien date is the first day of March preceding the fiscal year for which taxes are levied. (§ 2192.) The taxing agency’s right to the taxes for the fiscal year was fixed as of the lien date, even though the amount of the tax to be levied was unknown as of that date. (California Computer Products, Inc. v. County of Orange (1980) 107 Cal.App.3d 731, 736 [166 Cal.Rptr. 68].) On or before July 1, a county assessor was obligated to complete preparation of the local assessment roll, listing the assessed value of all real property within the county, among other information. (§§ 601, 602, 616.) Thereafter, each county’s board of supervisors fixed the tax rate and levied the taxes for that fiscal year. (§2151.) In sum, determining the value of property was but one of several steps in the process of property assessment and levy of property taxes. (See Ehrman & Ravin, Taxing Cal. Property (2d ed. 1979) §§ 12.1, 28.1-28.2, pp. 295, 631-632.)