Lister v. Utah State Tax Commission

F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
February 9, 2006
FOR THE TENTH CIRCUIT Elisabeth A. Shumaker
Clerk of Court
LAMAR LISTER,
Plaintiff-Appellant,
v. No. 05-4149
(D.C. No. 2:04-CV-618-DB)
UTAH STATE TAX COMMISSION, (D. Utah)
Defendant-Appellee.
ORDER AND JUDGMENT *
Before HENRY, McKAY, and MURPHY, Circuit Judges.
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument.
Plaintiff LaMar Lister, appearing pro se, appeals the district court’s
dismissal of his complaint against the Utah State Tax Commission (the
*
This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
“Commission”). This court exercises jurisdiction pursuant to 28 U.S.C. § 1291and affirms.
The Auditing Division of the Commission determined that Mr. Lister was
required to file Utah state income tax returns for the years 1999 and 2000, but he
had failed to do so. It sent him a notice of estimated income tax, assessing unpaid
Utah income taxes, penalties, and interest. Mr. Lister claimed that he was not
required to file a Utah income tax return because he was a resident of Nevada.
Following a formal hearing before an Administrative Law Judge, the Commission
issued a ruling in March 2004, finding that Mr. Lister had been domiciled in Utah
since April 1, 1999, and was, therefore, obligated to pay state income taxes for
1999 and 2000.
Mr. Lister then filed a complaint in the federal district court in Utah
asserting that the Commission lacked authority to determine his residency and
requesting that the district court invalidate the Commission’s March 2004 order.
The Commission filed a motion to dismiss, contending Mr. Lister’s claims were
barred by the Tax Injunction Act, 28 U.S.C. § 1341 (TIA), and Eleventh
Amendment immunity. The district court summarily dismissed, adopting the
reasoning in the motion to dismiss.
The TIA provides that “[t]he district courts shall not enjoin, suspend or
restrain the assessment, levy or collection of any tax under State law where a
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plain, speedy and efficient remedy may be had in the courts of such State.”
§ 1341. The TIA is a broad prohibition against the use of the equity powers of
federal courts involving state tax matters. Brooks v. Nance, 801 F.2d 1237, 1239
(10th Cir. 1986). It forbids not only injunctive relief, but also declaratory and
monetary relief. See Nat’l Private Truck Council, Inc. v. Okla. Tax Comm’n,
515 U.S. 582, 586-87 (1995); Marcus v. Kan. Dep’t of Revenue, 170 F.3d 1305,
1309 (10th Cir. 1999). The TIA “operates to divest the federal courts of subject
matter jurisdiction over claims challenging state taxation procedures where the
state courts provide a plain, speedy and efficient remedy.” Marcus, 170 F.3d at
1309 (quotations omitted). We review the district court’s dismissal de novo. Id.Mr. Lister contends that he is not seeking to enjoin, suspend or restrain the
assessment of any tax under state law, but is merely seeking a declaration that the
Commission lacked authority to determine and declare his domicile. We disagree.
Mr. Lister’s action clearly seeks both injunctive and declaratory relief related to
state tax matters and clearly seeks to invalidate and interfere with a state tax levy.
This is prohibited under the TIA. This is true even where a plaintiff is
challenging a tax-related residency requirement. See Mandel v. Hutchinson,
494 F.2d 364, 365-66 (9th Cir. 1974) (holding that TIA prohibits federal court
from intervening in a tax suit regarding residency requirements, even where
plaintiff alleges the tax is unconstitutional).
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Mr. Lister argues that, as a resident of Nevada, he has no other forum
beside the federal court to resolve the question of his residency. He further
claims that the Commission’s decision violated his constitutional due process
rights. Utah provides a plain, speedy and efficient remedy in its courts for
Mr. Lister to challenge the residency determination by the Commission, and to
raise any constitutional challenge. See California v. Grace Brethren Church,
457 U.S. 393, 413 (1982) (holding that state remedy will be sufficient if it
provides the taxpayer with a full hearing and judicial determination at which the
taxpayer may raise any and all constitutional objections). Pursuant to Utah Code
Ann. § 59-1-501 through 59-1-610, any aggrieved taxpayer is entitled to a hearing
before the Commission, which Mr. Lister received; de novo review of the
Commission’s decision in the state district court, which Mr. Lister did not pursue;
and appellate review by the Utah Court of Appeals and the Utah Supreme Court.
Moreover, Mr. Lister could pay the tax under protest and then challenge the
legality or constitutionality of the tax in Utah state court pursuant to Utah Code
Ann. § 59-1-301.
Thus, Mr. Lister had a plain, speedy and efficient remedy under Utah state
law to correct any erroneous decision of the Commission and to raise any alleged
violation of his constitutional rights. Cf. Brooks, 801 F.2d at 1240. The district
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court correctly ruled, therefore, that it lacked jurisdiction to consider Mr. Lister’s
claims. Because we affirm the dismissal under the TIA, we need not address the
applicability of the Eleventh Amendment.
The judgment of the district court is AFFIRMED.
Entered for the Court
Monroe G. McKay
Circuit Judge
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