American Law’s Worst Moment—2020

AUSTIN SARAT

Austin Sarat—Associate Provost and Associate Dean of the Faculty and William Nelson Cromwell Professor of Jurisprudence & Political Science at Amherst College—explains why the police murder of George Floyd was the worst moment of 2020 in American law. Professor Sarat proposes that we remember the event and that date—May 25—as “infamous,” a word reserved for rare and atrocious events like the bombing of Pearl Harbor, in an attempt to capture the brutality and inhumanity of the act.

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Letterman Digital Arts Ltd. v. City & County of San Francisco

Court: California Courts of Appeal

Docket: A156315(First Appellate District)

Opinion Date: December 30, 2020

Judge: Pollak

Areas of Law: Government & Administrative Law, Tax Law

The Presidio, formerly a military base, is now a National Park, within San Francisco's Golden Gate National Recreation Area. It is an exclusive federal enclave. The 1940 Buck Act (4 U.S.C. 105–110.) authorizes states and local jurisdictions to impose income taxes on activities in federal areas, or on residents of such federal areas, to the same extent and with the same effect as though such land was not a federal area. The 1996 Presidio Trust Act created a wholly-owned government corporation to manage the Presidio, exempt from certain federal laws and regulations. In 2000, section 103(c)(9) was amended to read: “The Trust and all properties administered by the Trust and all interest created under leases, concessions, permits and other agreements associated with the properties shall be exempt from all taxes and special assessments of every kind by" California, and its political subdivisions. Letterman paid the city business registration fees and gross receipts taxes. Letterman later sought refunds totaling $76,880.52, plus interest, arguing that section 103(c)(9) exempts “rents earned by subletting real property leased from the Presidio Trust.”. The court of appeal affirmed the dismissal of the suit. Section 103(c)(9) exempts a lessee of property in the Presidio only from the payment of property taxes; it does not purport to exempt any other party from the payment of an otherwise applicable tax other than a tax on the property itself.

Phillis v. County of Humboldt

Court: California Courts of Appeal

Docket: A158725(First Appellate District)

Opinion Date: December 31, 2020

Judge: Kline

Areas of Law: Real Estate & Property Law, Tax Law

In 2013, Phillips purchased Humboldt County property at a public trustee sale for $153.806.41, comprising two 80-acre parcels, two miles from a public road. The terrain is mostly steep and wooded. There is a 1,508-square-foot, three-bedroom manufactured home on a permanent foundation that uses a solar generator system, a spring-fed water system, and a septic system. The property was previously purchased in 2000 for $125,000; in 2001 the modular home was added, costing $85,000. Phillips filed multiple applications challenging the prior owner’s $469,976 assessment. The Assessor reappraised the property at $415,000. Phillips cited Revenue and Taxation Code 110(b): the purchase price of real property is rebuttably presumed to be its “fair market value” “if the terms of the transaction were negotiated at arms-length between a knowledgeable transferor and transferee neither of which could take advantage of exigencies. Phillips argued that the price he paid for the property had to be treated as its taxable value and challenged the Assessor’s comparable sales analysis, The Board determined the value to be $250,000. Phillips filed a tax refund action. On remand, the Board found the 2013 fair market value was $335,000. The court of appeal affirmed that the property was not obtained in an open market transaction, there was substantial evidence to support the Board’s conclusion as to its assessed value of the property, and Phillips’ due process rights were not violated. A foreclosure sale is by nature not an open market transaction supporting the application of the section 110 presumption; even where that presumption applies, it may be rebutted by evidence that the property's fair market value is otherwise.