Association of Washington Stevedoring Companies v. Department of Revenue

Utter, J.

(dissenting) — I believe the stevedoring cases2 upon which the majority relies have been impliedly overruled and are also distinguishable from the facts here presented. The United States Supreme Court in Western Live Stock v. Bureau of Revenue, 303 U.S. 250, 82 L. Ed. 823, 58 S. Ct. 546, 115 A.L.R. 944 (1938); Central Greyhound Lines, Inc. v. Mealey, 334 U.S. 653, 92 L. Ed. 1633, 68 S. Ct. 1260 (1948); Interstate Oil Pipe Line Co. v. Stone, 337. U.S. 662, 93 L. Ed. 1613, 69 S. Ct. 1264 (1949); Canton R.R. v. Rogan, 340 U.S. 511, 95 L. Ed. 488, 71 S. Ct. 447, 20 A.L.R.2d 145 (1951); Colonial Pipeline Co. v. Traigle, 421 U.S. 100, 44 L. Ed. 2d 1, 95 S. Ct. 1538 (1975), has severely eroded the scope of the "direct-indirect" test enunciated in the stevedoring cases. In addition, the Supreme Court's inaction in the face of the questioning of the continued, validity of the stevedoring cases in Martin Ship Serv. Co. v. Los Angeles, 34 Cal. 2d 793, 215 P.2d 24 (1950); Washington-Oregon Shippers Cooperative Ass'n v. Schumacher, 59 Wn.2d 159, 367 P.2d 112 (1961); HC&D Moving & Storage Co. v. Yamane, 48 Hawaii 486, 405 P.2d 382 (1965), raises further doubts as to the necessity of their use as mandatory precedent here.

*321The clause here at issue is the commerce clause3 rather than the import-export clause.4 A state generally has broader discretion in taxing activities than goods. Canton R.R. v. Rogan, supra. The commerce clause involves a grant of power to Congress, in the face of which a state may exercise its power so long as it does not negate the union's ability to act. The import-export clause imposes the same limits as the commerce clause as well as depriving the states of the ability to levy an impost or duty on an export or import. Michelin Tire Corp. v. Wages, 423 U.S. 276, 46 L. Ed. 2d 495, 96 S. Ct. 535 (1976).

The business and occupation tax, even though it reaches stevedoring activity, is not a tax on imports or an impost or duty on the activity of importing. Stevedores are not importers nor is stevedoring an importing activity, for stevedores have no direct relationship to imports, but only to the process of importing and exporting. Sea-Land Serv., Inc. v. County of Alameda, 12 Cal. 3d 772, 528 P.2d 56, 117 Cal. Rptr. 448 (1974); Canton R.R. v. Rogan, supra.

Stevedoring activity, while necessary to interstate commerce, is not in itself interstate commerce. All activity, takes place locally, that is, wholly within this state, and involves the type of business for which the state affords protection. Michelin Tire Corp. v. Wages, supra at 289. This State's business and occupation tax is not selectively imposed. It is a general occupation tax and does not substantially impair or prohibit transportation. As such it does not violate the import-export clause.

Even if the loading and unloading of ships can be said to have interstate characteristics, the State may still levy a *322nondiscriminatory gross receipts tax if there is no multiple burden or regulation of commerce. A nondiscriminatory tax on interstate commerce is valid if it is apportioned and does not reach activities beyond the state's borders. Canton R.R. v. Rogan, supra at 515.

A tax which is not an impost or duty and therefore prohibited, or an act of direct regulation, such as a license, is a general tax and is not forbidden unless it is a regulation of commerce in disguise. General Motors Corp. v. Washington, 377 U.S. 436, 12 L. Ed. 2d 430, 84 S. Ct. 1564 (1964). The State can tax but cannot regulate commerce by any means. Brown v. Maryland, 25 U.S. (12 Wheat.) 419, 448-49, 6 L. Ed. 678 (1827). However, a general business and occupation tax is "not a licensing provision for the regulation of a business or calling, nor does it impose conditions prerequisite to engaging in business within the state." Smith v. State, 64 Wn.2d 323, 333, 391 P.2d 718 (1964).

There is no showing that this tax is offensive to the commerce clause and it should be upheld.

Dolliver, J., concurs with Utter, J.

Puget Sound Stevedoring Co. v. Tax Comm'n, 302 U.S. 90, 82 L. Ed. 68, 58 S. Ct. 72 (1937); Joseph v. Carter & Weekes Stevedoring Co., 330 U.S. 422, 91 L. Ed. 993, 67 S. Ct. 815 (1947).

U.S. Const, art. 1, § 8, reads in part:

"To regulate commerce with foreign nations, and among the several states, and with the Indian tribes;”

U.S. Const, art. 1, § 10, reads in part:

"No state shall, without the consent of the congress, lay any imposts or duties on imports or exports, except what may be absolutely necessary for executing its inspection laws: and the net produce of all duties and imposts, laid by any state on imports or exports, shall be for the use of the treasury of the United States; and all such laws shall be subject to the revision and control of the congress."