Taxpayer Standing in Washington

What standing is necessary for a taxpayer to bring an action questioning legality of an action by Washington municipal entity?

There should be no confusion about this, but there is. Some assert that a taxpayer must show that it pays the type of taxes which fund the project in question.  The proponents of this requirement of taxpayer action look to  Dick Enters., Inc. v. King County, 83 Wn. App. 566, 572 – 572, 922 P.2d 184 (1996) (Div. I, 1996) :

In order to bring a taxpayer suit, the complaint must allege both a taxpayer’s cause of action and facts  supporting taxpayer status. Among other things, the plaintiff must show that it pays the type of taxes funding the project, and that it asked the Attorney General’s office to take action before bringing suit.[Footnotes omitted.]

Dick Enterprises is not good law on the issue taxpayer standing.

Dick Enterprises comes out of Division I of the Court of Appeals.  About four years after the decision, Division I addressed the standing issue differently in Robinson v. City of Seattle, 102 Wn. App. 795, 804 – 05, 10 P.3d 452 (2000):

Washington recognizes ‘litigant standing to challenge governmental acts on the basis of status as a taxpayer.’ Under the doctrine of taxpayer standing, ‘a taxpayer need not allege a  personal stake in the matter, but may bring a claim on behalf of all  taxpayers.’  Taxpayers need not allege a direct, special, or pecuniary interest in the outcome of the suit, but must demonstrate that their demand to the Attorney General to institute the action was refused, unless such a request would have been useless. [Footnotes omitted.]

In Division II the court did not adopt the Dick Enterprises rule.  In fact, it specifically declared that the rule is limited to situations where a lawful act of the municipal entity is in question.   Kightlinger v. Pub. Util. Dist. No. 1 of Clark County, 119 Wn. App. 501, 506, 81 P.3d 876 (2003), wherein the court said:

A taxpayer must show special injury where he or she challenges an agency’s lawful, discretionary act. Am. Legion [Post No. 32 v. City of Walla Walla, 116 Wash.2d 1, 7-8, 802 P.2d 784 (1991)].  Where a municipal corporation acts illegally, ‘it is a fair presumption that every taxpayer will be injured in some degree by such illegal act.’ Barnett v. Lincoln, 162 Wash. 613, 623, 299 P. 392 (1931).

Here, the Taxpayers do not challenge a lawful discretionary act. Rather, they argue that the PUD lacks lawful authority to operate an appliance repair business. Thus, the taxpayers are not required to demonstrate a unique injury. State ex rel. Boyles v. Whatcom County Superior Court, 103 Wn.2d 610, 694 P.2d 27 (1985).

Division III has taken the same position.  In  Eugster v. Spokane, 139 Wn. App. 21, 28, 156 P.3d 912 (2007) the court said:

Ordinarily, an individual taxpayer must show special injury in order to sue a municipality. Am. Legion Post No. 32 v. City of Walla Walla, 116 Wn.2d 1, 7-8, 802 P.2d 784 (1991). But every taxpayer is presumed injured if the city acts illegally. Kightlinger v. Pub. Util. Dist. No. 1 of Clark County, 119 Wn. App. 501, 506, 81 P.3d 876 (2003).

The court went on to say:

However, taxpayers must first request the appropriate government entity — here, the attorney general — take action on their behalf. Id. at 508 (citing City of Tacoma v. O’Brien, 85 Wn.2d 266, 269, 534 P.2d 114 (1975)). Alternatively, the taxpayer may show that a request for government action would be useless. Wash. Pub. Trust Advocates ex rel. City of Spokane v. City of Spokane, 117 Wn. App. 178, 182, 69 P.3d 351(2003).

The Washington Supreme Court, the state’s highest court, says rules regarding taxpayer standing can be found in State ex rel. Boyles v. Whatcom County Superior Court, 103 Wn.2d 610, 614, 694 P.2d 27 (1985); City of Tacoma v. O’Brien, 85 Wn.2d 266, 269, 534 P.2d 114(1975).

But some will say the rules have been changed.   They will cite   Greater Harbor 2000, 132 Wash.2d at 300-01, 937 P.2d 1082 (1997) for support that the rules have been changed — that the taxpayer has to be tied to the taxes used on the project in question. But in that case, the lead opinion had one concurring justice. Three justices concurred in the result on other grounds. Two justices agreed with the conclusion on the merits but disagreed with the lead opinion that the taxpayers had to show a personal stake in the outcome to have standing. Greater Harbor 2000, 132 Wash.2d at 286-87, 937 P.2d 1082. And two justices dissented, reasoning in part that the taxpayers did not have to show particular injury because they were challenging an unlawful act, not a discretionary act. Greater Harbor 2000, 132 Wash.2d at 300-01, 937 P.2d 1082. Thus, the Supreme Court has not changed its position that for standing in a taxpayer action requires that the plaintiff is a taxpayer and that a request has been made that the attorney general act but that the attorney general has declined to take action.  See the discussion of this in Robinson v. City of Seattle, 102 Wn. App. 795, 805 Fn. 12 , 10 P.3d 452 (2000).

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