Williams v. State

NOTICE:  This opinion is subject to motions for reargument under V.R.A.P. 40
as well as formal revision before publication in the Vermont Reports.
Readers are requested to notify the Reporter of Decisions, Vermont Supreme
Court, 111 State Street, Montpelier, Vermont 05602 of any errors in order
that corrections may be made before this opinion goes to press.


                          Nos. 88-309 and 89-042


Norman Williams and                          Supreme Court
Susan Levine
                                             On Appeal from
     v.                                      Washington Superior Court

State of Vermont and                         March Term, 1990
William H. Conway, Jr.,
Vermont Commissioner of
Motor Vehicles


Valerie M. Quinn and
James Woodard

     v.

State of Vermont and
William H. Conway, Jr.,
Vermont Commissioner of
Motor Vehicles


Alden T. Bryan, J.

O'Neill and Crawford and Norman Williams, pro se, Burlington, for
  plaintiffs-appellants Williams and Levine

Mary P. Kehoe of Gear and Davis, Inc., Burlington, for plaintiff-
  appellant Woodard

Jeffrey L. Amestoy, Attorney General, and Thomas R. Viall and Andrew M.
  Eschen, Assistant Attorneys General, Montpelier, for defendants-appellees


PRESENT:  Allen, C.J. and Gibson, J., and Wolchik, D.J., Katz, Supr. J.,
          and Fisher, D.J., Specially Assigned


     KATZ, Supr. J., Specially Assigned.   Plaintiffs filed suit in
Washington Superior Court to secure refunds of taxes paid to the Department
of Motor Vehicles upon first registering automobiles in Vermont.  The
superior court dismissed plaintiffs' claims.  We affirm.

                                I.  Record
     In 1980, Norman Williams purchased and registered a Volkswagen Dasher
in Illinois, his state of residency at the time, and paid the five percent
Illinois sales tax.  In 1981, he moved to Vermont with his car.  When he
subsequently applied to register the vehicle with the Vermont Department of
Motor Vehicles, he was required to pay Vermont's four percent use tax
pursuant to 32 V.S.A. { 8903(b).  Believing the tax was unconstitutional, as
it did not apply to Vermont residents who purchased and paid a sales tax on
vehicles in reciprocating states (including Illinois), see { 8911(9), (FN1)
Williams brought suit in federal court under 42 U.S.C. { 1983 to enjoin
enforcement.  That suit was dismissed on the authority of the Tax Injunction
Act, 28 U.S.C. { 1341.  Williams then paid the tax and initiated an
administrative proceeding, pursuant to 32 V.S.A. { 8914, for a refund.  The
Motor Vehicles Department felt constrained to assume the constitutionality
of the tax scheme and denied relief.
     Williams then filed the present action in superior court, serving the
State and Commissioner Conway, pursuant to V.R.C.P. 4(d)(2), by serving the
Attorney General.  Susan Levine joined the action in an amended complaint.
Levine, like Williams, had moved to Vermont from another state, bringing her
car with her.  She had purchased a Chrysler Horizon in New York and paid the
seven percent New York sales tax.  When she registered the car in Vermont,
she was required to pay the state use tax.
     In their complaint, Williams and Levine requested refunds of the
respective use taxes as well as a declaratory judgment that the tax scheme
violates several provisions of the United States Constitution: article I,
section 8, clause 3 (Commerce Clause); article IV, section 2 (Privileges and
Immunities); and the Fourteenth Amendment (Equal Protection and Privileges
and Immunities Clauses).  Although now in state court, the complaint rests
on the federal cause of action provided by 42 U.S.C. { 1983.
     The State filed a motion to dismiss, asserting the constitutionality of
the statute.  The motion was granted and Williams and Levine appealed to
this Court, which affirmed on the strength of our opinion in Leverson v.
Conway, 144 Vt. 523, 481 A.2d 1029 (1984).  The United States Supreme Court
then granted certiorari, reversed our decision, declared the statute invalid
under the Equal Protection Clause of the Fourteenth Amendment, as it
purported to afford unequal treatment to state residents and nonresidents
without sufficient justification, and remanded for further proceedings.
Williams v. Vermont, 472 U.S. 14 (1985).  We, in course, remanded to the
superior court.  There, the State filed an answer raising, among other
defenses, sovereign immunity.
     In 1985, while a Vermont resident, James Woodard purchased and
registered a vehicle in Florida, paying that state's seven percent sales
tax.  Upon transferring the registration to Vermont, he was told he had to
pay Vermont's use tax.  He brought suit in superior court (FN2) seeking a refund
and a declaration that the Department of Motor Vehicles' practice (FN3) of not
affording a tax credit to Vermont residents in his situation -- that is,
having registered a vehicle out of state prior to returning to Vermont -- is
both contrary to the statutory scheme and in violation of several provisions
of the Vermont Constitution as well as the Fourteenth Amendment to the
United States Constitution.
     None of the plaintiffs specify any relief against Conway personally.
Nor are any allegations made to suggest any conduct on his part, other than
that of the Department generally, of which he was Commissioner.
     Although nominally consolidated below, the superior court issued
separate decisions dismissing the respective complaints.  As to the
Williams/Levine request for declaratory relief, the court held that the
equal protection issues were moot, in light of the Department of Motor
Vehicles' 1986 regulation denying the tax credit of { 8911(9) to Vermonters
who purchase and register cars out of state.  Upholding the regulation as
consistent with the meaning and intent of the statute, the court reasoned:
"Because section 8911(9) [as clarified by the regulation] now explicitly
provides no special treatment for residents, it is facially constitutional
and would survive the equal protection scrutiny used by the Williams court.
Therefore, the plaintiffs no longer can request declaratory judgment . . .
because the equal protection issues concerning what section 8911(9) means
and how the exemption must be applied are now moot."  As to their claim for
a tax refund, the court held that recovery was barred by sovereign immunity,
relying on American Trucking Ass'ns v. Conway, 146 Vt. 579, 508 A.2d 408
(1986), cert. denied, 483 U.S. 1019-20 (1989).  As to the Woodard/Quinn
complaint, the superior court reached the merits, upheld the Department's
regulation against plaintiffs' several challenges, and granted the State's
motion to dismiss.
     Appeals were taken from both rulings.  We affirm, but for reasons
differing in several respects from those espoused by the superior court.
                           II.  Claim for Refund
                           A.  42 U.S.C. { 1983
     Both complaints are explicitly and solely founded on 42 U.S.C. { 1983,
the Reconstruction Era civil rights statute which provides a private remedy
for those alleging abridgment of federal rights by "persons" acting "under
color of" state law.  Although { 1983 was clearly intended to provide a
federal forum for those seeking vindication of federal rights, there is no
bar to the statute's use in state courts.  Maine v. Thiboutot, 448 U.S. 1,
11 (1980); Beauregard v. City of St. Albans, 141 Vt. 624, 626, 450 A.2d 1148, 1149 (1982).
     However, { 1983 may not be used to make a claim for relief against a
state, as states are not "persons" within the meaning of the statute.  Will
v. Michigan Dep't of State Police, 109 S. Ct. 2304, 2308 (1989).  Manifestly
and explicitly, the State of Vermont is the defendant in these cases.  The
purpose for each of these plaintiffs having commenced suit was and remains
the refund of all or part of the Vermont use tax paid on their respective
autos.  The actions seek retrospective relief that can come only from the
State treasury.  "[W]hen the action is in essence one for the recovery of
money from the state, the state is the real, substantial party in interest .
. . even though individual officials are nominal defendants."  Ford Motor
Co. v. Department of Treasury of Indiana, 323 U.S. 459, 464 (1945).  Under
Will, { 1983 is not available for such relief.
     At oral argument and in a supplementary brief, Mr. Williams suggested
that footnote 10 of Will, 109 S. Ct.  at 2311, supports his position, and
exempts the present cases from the clear and general rule laid down by Will.
We fail to see how.  In pertinent part, footnote 10 states:
         Of course a State official in his or her official
         capacity, when sued for injunctive relief, would be a
         person under { 1983 because "official capacity actions
         for prospective relief are not treated as actions
         against the State."  This distinction is "commonplace in
         sovereign immunity doctrine," and would not have been
         foreign to the 19th-century Congress that enacted {
         1983.

Id. at 2311 n.10 (citations omitted; emphasis supplied).  The actions
presently before this Court are not for prospective relief.  Rather, these
are actions to recover money already spent. (FN4) As Justice Stevens notes in
dissent, the holding of Will, and in particular, footnote 10, is that while
a state or its agent sued in an official capacity may be sued under { 1983
for injunctive relief, they may not be so sued for monetary relief.  Id. at
2323. (FN5) Absent waiver, the Eleventh Amendment (FN6) bars a damages action
against the state brought in federal court; Will makes clear that { 1983
does not provide an avenue for the same relief in state court.  "Will
establishes that the State and arms of the State, which have traditionally
enjoyed Eleventh Amendment immunity, are not subject to suit under { 1983 in
either federal court or state court."  Howlett v. Rose, 110 S. Ct. 2430,
2437 (1990); see also Edelman v. Jordan, 415 U.S. 651, 663, 678 (1974)
(action to recover wrongfully withheld welfare payments from state funds
barred as action against state); Ford Motor Co. v. Department of Treasury of
Indiana, 323 U.S.  at 462-63 (action seeking refund of taxes collected by
state in violation of federal law barred as action against state); Note,
Clarifying Comity:  State Court Jurisdiction and Section 1983 State Tax
Challenges, 103 Harv. L. Rev. 1888, 1896 (1990) (discussing import of Will
on state tax litigation).
     Accordingly, we reject plaintiffs' claims for monetary relief against
the State or Commissioner Conway under { 1983. (FN7) Assuming the complaints
also rest on state causes of action (although they are designated solely as
{ 1983 actions), we next consider the State's defense of sovereign immunity.
                          B.  Sovereign Immunity
1.  Scope of Remand
     After remand from the United States Supreme Court and this Court, the
State raised for the first time the defense of sovereign immunity.
Initially, plaintiffs object to this defense on the ground that the Supreme
Court remanded for the sole purpose of directing a refund.  For several
reasons, we reject this attempt to limit or avoid issues raised below.
     The State first responded to the complaint by filing a motion to
dismiss, asserting the constitutionality of its taxation scheme.  That
motion was granted by the superior court.  As a matter of pleading,
therefore, the State was not at that time required to file an answer or
affirmative defenses -- which were due only ten days after the motion was
denied.  V.R.C.P. 12(a).  The United States Supreme Court ultimately denied
the State's motion, and, until remand, no obligation to plead an affirmative
defense existed.  Unless somehow barred by the United States Supreme Court's
mandate, the State's answer and affirmative defenses, filed September 12,
1985, were timely. (FN8) See Patsy v. Board of Regents of State of Florida, 457 U.S. 496, 515 n.19 (1982) (sovereign immunity defense may be raised on
remand after appeal from lower court's dismissal of action on the
pleadings).  Therefore, plaintiffs' reliance on cases barring new issues
after remand, when those cases had already been tried prior to appeal, is
unavailing.  The Supreme Court explicitly recognized that a full record had
not been developed but that the "action was dismissed for failure to state a
claim before an answer was filed."  Williams v. Vermont, 472 U.S.  at 28.
     Plaintiffs suggest that their case was remanded from the Supreme Court
"with specific instructions."  To the contrary,
         in light of the fact that the action was dismissed on
         the pleadings, and given the possible relevance of state
         law, we express no opinion as to the appropriate remedy.
            We hold only that, when the statute is viewed on its
         face, appellants have stated a claim of unconstitutional
         discrimination.  The decision below is accordingly
         reversed, and the case is remanded for further
         proceedings not inconsistent with this opinion.

472 U.S.  at 28 (citation omitted).  It is clear that nothing more than the
granting of the motion to dismiss was reversed; nothing else was decided.
If further support were needed, it is supplied by the recent decision noting
that "after invalidating a state tax scheme on Commerce Clause grounds, [the
Supreme Court has] left state courts with the initial duty upon remand of
crafting appropriate relief in accord with both federal and state law."
McKesson Corp. v. Division of Alcoholic Beverages and Tobacco, ___ U.S. ___,
___, 58 U.S.L.W. 4665, 4669 n. 16 (June 4, 1990) (citing Williams v. Vermont
as an example); accord American Trucking Ass'ns v. Smith, ___ U.S. ___, ___,
48 U.S.L.W. 4704, 4707 (June 4, 1990).
     The Supreme Court, by its mandate, made no decision regarding
affirmative defenses or remedial issues which might arise under state or
federal law, or which might affect one or another remedy.  The State was not
precluded from raising a defense such as sovereign immunity.
2.  Due Process Requirement of Remedy for Constitutional Violation
     Plaintiffs argue that the Fourteenth Amendment prohibition against
deprivation of property without due process of law (FN9) requires that they be
afforded a remedy to secure return of improperly exacted taxes.  They are
correct.
         To satisfy the requirements of the Due Process Clause
         . . . in this refund action the State must provide tax-
         payers with, not only a fair opportunity to challenge
         the accuracy and legal validity of their tax obligation,
         but also a "clear and certain remedy" for any erroneous
         or unlawful tax collection to ensure that the opportu-
         nity to contest the tax is a meaningful one.

McKesson Corp. v. Division of Alcoholic Beverages, ___ U.S. at ___, 58
U.S.L.W. at 4671 (citation and footnote omitted).  "[A] ruling that a tax is
unconstitutionally discriminatory under the Commerce Clause places
substantial obligations on the States to provide relief . . . ."  American
Trucking Ass'ns v. Smith, ___ U.S. at ___, 58 U.S.L.W. at 4708.
     Vermont must afford a remedy and a meaningful remedy, but not any
particular remedy.  "[S]ome form of hearing is required before an individual
is finally deprived of a property interest."  Mathews v. Eldridge, 424 U.S. 319, 333 (1976), quoted in McKesson Corp., ___ U.S. at __ n.17, 58 U.S.L.W.
at 4670 n.17.  But that remedy is not, as a matter of constitutional
necessity, a plenary suit in the court of general jurisdiction.
     Our Legislature has provided a specific administrative procedure to
afford plaintiffs the remedy to which they are constitutionally entitled.
32 V.S.A. { 8914 states:
         Any overpayment of [the motor vehicle purchase and use]
         tax as determined by the commissioner shall be refunded.

Plaintiffs concede that { 8914 covers unconstitutional taxes as well as
arithmetic errors:  "The statute makes no distinction between overpayments
due to unconstitutionality or other causes."  Brief for Appellants Williams
and Levine at 19; Brief for Appellant Woodard at 27.  See also United
States v. Dalm, 110 S. Ct. 1361, 1368-69 n.6 (1990) ("The common sense
interpretation is that a tax is overpaid when a taxpayer pays more than is
owed, for whatever reason or no reason at all . . . .  The word
['overpayment'] encompasses 'erroneously,' 'illegally,' or 'wrongfully'
collected taxes . . . .").
     Prior to the United States Supreme Court's decision, the remedy
provided by { 8914 was not available to Williams and Levine to the extent
they challenged the facial validity of { 8903, because the Commissioner of
Motor Vehicles is not authorized to rule upon the constitutionality of the
statutes he is bound to administer.  See Westover v. Village of Barton Elec.
Dep't, 149 Vt. 356, 357, 543 A.2d 698, 699 (1988).  Nevertheless, after the
Supreme Court's ruling that the use tax statute is facially unconstitu-
tional, a complaint to the Commissioner under { 8914 would not have been
futile. (FN10) The Commissioner at that point would not have been required to
address the constitutionality of the statute, for that question had been
decided; he would have been faced instead with three potential questions:
Did the Department in fact administer the use tax statute in a manner that
discriminated against nonresidents?  If not, did the Department's
enforcement of the tax, eventually pursuant to Rule 86-28-E, comply with
the statute?  If it did comply with the statute, did the practice violate
the Commerce or Privileges and Immunities Clauses? (FN11) Plaintiff Woodard also
challenged the Department's practice on statutory grounds, and raised
additional constitutional challenges to the use tax as administered in the
case of Vermont residents who registered their cars out of state before
bringing them to Vermont.  The Commissioner had jurisdiction to decide all
of these claims.  See Alexander v. Town of Barton, 152 Vt. 148, 151, 565 A.2d 1294, 1296 (1989) (while administrative agencies cannot rule on the
constitutionality of legislation, they can adjudicate constitutional
questions in determining validity of statutorily-delegated agency
practices); Christian Brothers Institute of New Jersey v. Northern New
Jersey Interscholastic League, 86 N.J. 409, 416, 432 A.2d 26, 29 (1981)
(administrative agency may rule on constitutional issues relevant and
necessary for resolution of questions within scope of its jurisdiction); 4
K. Davis, Administrative Law Treatise { 26:15, at 480 (2d ed. 1983)
(exhaustion of administrative remedies "may be required when a factual
context is needed for deciding the constitutional question or when the
objecting party may prevail on nonconstitutional grounds").  The first
question posed by Williams and Levine, in particular, was suited to agency
determination.  See Weinberger v. Salfi, 422 U.S. 749, 765 (1975)
("Exhaustion is generally required as a matter of preventing premature
interference with agency processes, so that the agency may function
efficiently and so that it may have an opportunity to correct its own
errors, to afford the parties and the courts the benefit of its experience
and expertise, and to compile a record which is adequate for judicial
review.").  All plaintiffs in this case, therefore, had an available remedy
in { 8914 but chose not to pursue it.
     One further point must be addressed.  In American Trucking Ass'ns v.
Conway, 146 Vt. 579, 508 A.2d 408 (1986), this Court considered a
constitutional challenge to statutes imposing certain fees on foreign-
registered trucks.  While ruling that the statutes at issue violated the
Commerce Clause of the United States Constitution, we upheld the superior
court's refusal to order a refund of fees collected pursuant to the
objectionable statutes.  "This action for a tax refund is a suit against the
state, and therefore, is barred by sovereign immunity unless the state has
waived its immunity."  Id. at 587-88, 508 A.2d  at 414.  We found that 23
V.S.A. { 3020(b), authorizing the Commissioner to refund a tax or fee that
"has been illegally or erroneously collected or computed," did not
constitute a waiver of sovereign immunity.  The statute, we wrote, "merely
provides for a refund mechanism if errors are made in determining what tax
is imposed. . . .  Here, the Vermont legislature has not inferentially
indicated its intent to provide the amounts paid to the state under a
statute later declared invalid."  Id. at 588, 508 A.2d  at 414.
     We recognize that our construction of 23 V.S.A. { 3020(b) in American
Trucking Ass'ns is incompatible with the meaning we have ascribed to 32
V.S.A. { 8914 in this opinion.  The term "overpayment" in { 8914, if
anything, implies a narrower authority to award refunds than the term
"illegally or erroneously collected" in { 3020(b); yet, as we have
explained, { 8914 does provide a remedy to recover "amounts paid to the
state under a statute later declared invalid."  The Court's confined reading
of { 3020(b) was grounded in an understanding of common-law sovereign
immunity that is no longer tenable after the Supreme Court's recent
unanimous decisions in McKesson Corporation and Howlett v. Rose.  Thus, in
American Trucking Ass'ns, we said that "the state cannot be sued without its
consent for injuries resulting from the exercise of functions essentially
governmental in character."  146 Vt. at 587, 508 A.2d  at 413.  But due
process may require that states entertain suits against them though they
have not consented.  That is the holding of McKesson:  "[I]f a State places
a taxpayer under duress promptly to pay a tax when due and relegates him to
a postpayment refund action in which he can challenge the tax's legality,
the Due Process Clause of the Fourteenth Amendment obligates the State to
provide meaningful backward-looking relief to rectify any unconstitutional
deprivation."  ___ U.S. at ___, 58 U.S.L.W. at 4668-69 (footnotes omitted).
Howlett specifically holds that the Supremacy Clause does not permit a state
law defense of sovereign immunity in a { 1983 action brought in state court
where a sovereign immunity defense would not be available had the action
been brought in a federal forum.  ___ U.S. at ___, 58 U.S.L.W. at 4761.
"[A]s to persons that Congress subjected to liability, individual States may
not exempt such persons from federal liability by relying on their own
common law heritage."  Id. at ___, 58 U.S.L.W. at 4763.  The import of these
decisions cannot be avoided.  Section III of the Court's opinion in American
Trucking Ass'ns should be considered overruled.
     Common-law sovereign immunity, however, is not vitiated entirely.  A
state must provide some remedy to permit the recoupment of
unconstitutionally exacted taxes, but it may choose, and limit, the remedy,
so long as it comports with due process principles.  McKesson notes that
"States may avail themselves of a variety of procedural protections against
any disruptive effects of a tax scheme's invalidation, such as providing by
statute that refunds will be available to only those taxpayers paying under
protest, or enforcing relatively short statutes of limitation applicable to
refund actions."  ___ U.S. at ___, 58 U.S.L.W. at 4674.  The Court added
that "[s]uch procedural measures would sufficiently protect States' fiscal
security when weighed against their obligation to provide meaningful relief
for their unconstitutional taxation."  Id.  Vermont has consented to suit
for the recovery of wrongfully levied purchase and use taxes by providing in
32 V.S.A. { 8914 for administrative complaint to the Commissioner of Motor
Vehicles.  Because that remedy provides taxpayers with due process --
indeed, plaintiffs have not challenged the sufficiency of the remedy -- the
defense of sovereign immunity in a court of plenary jurisdiction remains
intact and available to the State.
     The superior court could not award a refund of taxes absent the State's
waiver of immunity, and, therefore, properly dismissed plaintiffs' claims
for monetary relief.
                         III.  Declaratory Relief
     Following the Supreme Court's ruling that the statute contravened the
Equal Protection Clause, Williams v. Vermont, 472 U.S.  at 28, the State
argued on remand that the Department had not in fact administered the tax in
a discriminatory manner, and, to clarify its position, had promulgated Rule
86-28-E.  See note 3, supra.  The superior court agreed, holding that the
new rule eliminated the discriminatory treatment of nonresidents and thereby
rendered the request for declaratory judgment moot.  On appeal, Williams and
Levine contend that the statute, even as interpreted and administered by the
Department, continues to violate the Privileges and Immunities and Commerce
Clauses.  They also argue, in an effort to avoid the conclusion that the new
rule has rendered their equal protection challenge moot, that the rule
contradicts legislative intent and the plain meaning of 32 V.S.A. { 8911(9).
     In his complaint and on appeal, Woodard also requests a declaratory
ruling that the Department's enforcement of its tax scheme violates the
governing statute.  Woodard further raises state and federal constitutional
challenges to the scheme as administered.  In Woodard's case, the superior
court also dismissed the complaint, but reached the merits of his claims,
essentially granting declaratory relief to the State.
     All three plaintiffs' requests for declaratory rulings on federal
constitutional issues assertedly arise under 42 U.S.C. { 1983.  Of course,
plaintiffs' claims that are grounded on a violation of a state statute or
the Vermont Constitution are not properly brought under 42 U.S.C. { 1983
because that statute remedies the deprivation of rights secured by federal
law.  See Maine v. Thiboutot, 448 U.S.  at 4.  As to all claims, we find that
the superior court did not have jurisdiction to award declaratory relief.
The { 1983 claims, however, raise certain additional considerations, as
addressed below.
     Vermont law affords the superior court general authority to grant
declaratory relief.  12 V.S.A. {{ 4711-25.  Moreover, the Administrative
Procedure Act provides for declaratory judgment actions to challenge the
"validity or applicability of a rule . . . if it is alleged that the rule,
or its threatened application, interferes with or impairs, or threatens to
interfere with or impair, the legal rights or privileges of the plaintiff."
3 V.S.A. { 807.  The declaratory remedy, however, does not enlarge the
jurisdiction of the court.  Demag v. American Ins. Co., 146 Vt. 608, 610,
508 A.2d 697, 698 (1986).  If the Legislature has designated another
tribunal to hear certain claims, the declaratory judgments statutes do not
ipso jure vest jurisdiction over those claims in the superior court.  In
Demag, for example, the plaintiff sought a declaration that she was
entitled to receive certain death benefits under the Workers' Compensation
Act.  We held that the superior court had no jurisdiction over this claim,
"because plaintiff failed to avail herself of the administrative remedy
provided by the Workers' Compensation Act."  Id.  Similarly, in Trivento v.
Commissioner of Corrections, 135 Vt. 475, 380 A.2d 69 (1977), we considered
whether the superior court had jurisdiction to issue a declaratory ruling on
the constitutionality of a state prisoner's confinement.  We held that it
did not.
     Where the Legislature has provided that certain rights (here the
     right to have one's sentence modified) are enforceable in
     specified tribunals (here the superior court in which sentence was
     imposed), the declaratory judgments vehicle should not be used to
     frustrate that legislative choice.  To do so would be to ignore
     the message of 12 V.S.A. { 4711 and our prior holdings that the
     Act has not enlarged the subject matter jurisdiction of the
     courts.
Id. at 478, 380 A.2d at 71-72; see also Petition of D.A. Associates, 150
Vt. 18, 20, 547 A.2d 1325, 1326-27 (1988) ("when an administrative remedy is
established by statute or regulation, relief must not only be sought in
accordance therewith, but must first be exhausted before recourse to the
courts is available").  But see Neal v. Brockway, 136 Vt. 119, 121, 385 A.2d 1069, ___ (1978) ("bare existence of another adequate remedy is not a bar to
a declaratory judgment proceeding where a controversy exists").
     Declaratory relief would not give plaintiffs what they want; it would
only advise the ultimate decision-maker on points of law necessary to get a
refund.  As we have made clear, the superior court does not have
jurisdiction over the refund claims in this case absent a waiver of
sovereign immunity.  To the extent plaintiffs seek declaratory rulings in
order to obtain their refunds, the superior court likewise lacks
jurisdiction to award the requested declaratory relief.  As in Trivento and
Demag, plaintiffs may pursue their claims in another forum; the general
statutory authority vested in the superior court to award declaratory
judgments does not permit litigants to raise such claims, by their own
bootstraps, where jurisdiction is otherwise lacking.  The judiciary is not
empowered to render advisory opinions the sole purpose of which is to aid in
the resolution of a dispute that properly belongs in another tribunal.  See
Lace v. University of Vermont, 131 Vt. 170, 175, 303 A.2d 475, 478 (1973).
      Plaintiffs' requests for declaratory relief could not be decided in
the superior court, therefore, unless such requests are justiciable on their
own account, detached from the refund claims. (FN12) The availability of
declaratory or any other particular relief does not alter the fundamental
prerequisite to judicial authority -- a justiciable controversy.
       The function of a declaratory judgment is to provide a
     declaration of rights, status and other legal relations of parties
     to a justiciable controversy.  Without such justiciable
     controversy being present, the declaratory judgment can provide no
     more than an advisory opinion, which our State judiciary does not
     have the constitutional power to render.
Lace v. University of Vermont, 131 Vt. at 175, 303 A.2d  at 478 (citations
omitted).  "It is well settled that an action for declaratory relief must be
based on an actual controversy; the claimed result or consequences must be
so set forth that the court can see that they are not based upon fear or
anticipation but are reasonably to be expected."  Robtoy v. City of St.
Albans, 132 Vt. 503, 504, 321 A.2d 45, 46-47 (1974); accord Beecham v.
Leahy, 130 Vt. 164, 168, 287 A.2d 836, 838 (1972).  The Administrative
Procedure Act codifies these limits on the court's power over suits testing
the validity of agency rules by requiring "that the rule, or its threatened
application, interferes with or impairs, or threatens to interfere with or
impair, the legal rights or privileges of the plaintiff."  3 V.S.A. { 807.
     Our law conforms with the longstanding federal rule that the
availability of declaratory relief turns on whether "the facts alleged,
under all the circumstances, show that there is a substantial controversy,
between parties having adverse legal interests, of sufficient immediacy and
reality to warrant the issuance of a declaratory judgment."  Maryland
Casualty Co. v. Pacific Coal & Oil Co., 312 U.S. 270, 273 (1941).  A mere
abstract question or hypothetical threat is not a sufficient basis for a
declaratory judgment.  Golden v. Zwickler, 394 U.S. 103, 108 (1969).  Extra
caution is advised in cases involving political and constitutional
questions.  "The power of courts, and ultimately of this Court to pass upon
the constitutionality of acts of Congress arises only when the interests of
litigants require the use of this judicial authority for their protection
against actual interference.  A hypothetical threat is not enough."  United
Public Workers v. Mitchell, 330 U.S. 75, 89-90 (1947).
     It is apparent in the present cases that, once severed from the refund
claims, no justiciable controversy exists.  Williams has now lived in
Vermont close to ten years, and we may take judicial notice that he has been
a member of the bar of this Court for that period.  Levine has lived in the
state even longer.  Neither suggests a reasonable fear or anticipation of
being subject again to the allegedly unconstitutional use tax -- that is, of
purchasing and registering a vehicle out of state, while enjoying residency
in another state, and subsequently seeking to register the car in Vermont.
Similarly, Woodard is not likely again to purchase a car out of state and
again fail to secure Vermont registration by mail at the outset, thereby
avoiding the potential of double taxation.
     The United States Supreme Court's opinion in Golden v. Zwickler is
particularly instructive.  Zwickler had distributed an unsigned political
handbill, castigating a certain congressman for his stance on a foreign-aid
issue.  For that act, he was prosecuted under a New York statute barring
anonymous election literature.  His conviction was reversed on state law
grounds, but the statute remained in force.  Zwickler then brought suit for
a declaratory judgment on the statute's validity.  394 U.S.  at 104-05.
Writing for a unanimous court, Justice Brennan noted that the criticized
congressman had left that office for a fourteen-year term as a state supreme
court justice, and concluded:  "We think that under all the circumstances of
the case the fact that it was most unlikely that the Congressman would again
be a candidate for Congress precluded a finding that there was 'sufficient
immediacy and reality' [to justify issuance of a declaratory judgment]."
Id. at 109 (quoting Maryland Casualty, 312 U.S. at 273). (FN13)
     Declaratory relief is, and can be, sought in this case only to further
the true goal of obtaining other relief, namely a refund.  Because the
superior court has no jurisdiction over the refund claim, it also has no
jurisdiction to issue advisory declaratory relief.
     The superior court's declaratory judgment ruling is vacated; otherwise,
its orders dismissing the two complaints are affirmed.


                              FOR THE COURT:


                              ___________________________________________
                              Superior Judge, Specially Assigned








FN1.        Section 8911(9) provides:
	The tax imposed by this chapter shall not apply to:
	. . .
	(9)  pleasure cars acquired outside the state by a
	resident of Vermont on which a state sales or use tax
	has been paid by the person applying for a registration
	in Vermont, providing that the state or province
	collecting such tax would grant the same pro-rata credit
	for Vermont tax paid under similar circumstances.  If
	the tax paid in another state is less than the Vermont
	tax the tax due shall be the difference;

FN2.    Valerie Quinn joined Woodard's complaint, but she did not join this
appeal.

FN3.    Subsequently, the Department formalized this practice by adopting a
rule.  See Agency of Transportation, Department of Motor Vehicles, Rule 86-
28-E ("Motor Vehicle Purchase and Use Tax") (July 5, 1986).  The rule states
that the credit provided in 32 V.S.A. { 8911(9) shall be available to
Vermont residents only if the registrant "has not previously registered that
vehicle in the state where it was acquired or in any other state."  Id. at
(1)(d).  In materials filed with the proposed rule, the Department
maintained that the "rule reflects the existing practice of the Department."
Cover Sheet for Proposed Rule, Motor Vehicle Purchase and Use Tax (July 2,
1985).

FN4.    In an effort to style the relief requested as prospective, Mr.
Williams also urges that he should be permitted to receive a credit against
future taxes for any sums held wrongfully.  Such a remedy is without support
in law.  If he were correct, such a "credit" would constitute nothing less
than a total end run around the sovereign immunity doctrine.  A state's
immunity would be so tractable as to be useless.


FN5.    Footnote 10 of Will cites Osborn v. Bank of United States, 22 U.S.
(9 Wheat.) 738 (1824), and United States v. Lee, 106 U.S. 196 (1882), among
others, as cases presumably on the side of prospective relief; plaintiffs
assert that the reference to these cases supports their position.  Osborn
does require certain state officials to return a tax wrongfully levied
against the Bank, but the officials were already under an injunction not to
take the funds.  Osborn merely upholds a federal court's power to enforce an
injunction ordering state officials not to violate federal law.  In the
present case, plaintiffs never obtained an injunction before paying the tax.
In Lee, the Court ordered a return of wrongfully taken real property, and
the case, in any event, was a suit against federal officers.



FN6.    The Eleventh Amendment to the United States Constitution provides:
	  The Judicial power of the United States shall not be
	construed to extend to any suit in law or equity,
	commenced or prosecuted against one of the United States
	by Citizens of another State, or by Citizens or Subjects
	of any Foreign State.
Although the text does not address suits against a state by its own
citizens, the Supreme Court has long held that the Amendment's bar
encompasses such suits.  Hans v. Louisiana, 134 U.S. 1 (1890).  By its
terms, the Amendment restrains only the federal courts; "[n]o Eleventh
Amendment question is present . . . where an action is brought in a state
court."  Maine v. Thiboutot, 448 U.S. 1, 9 n.7 (1980).


FN7.    Plaintiffs also argue on appeal that their causes of action proceed
directly from the Fourteenth Amendment of the United States Constitution.
See Bivens v. Six Unknown Named Agents, 403 U.S. 388, 389 (1971) (private
damage action against federal officials implied from Fourth Amendment).  We
do not believe a Bivens-type action may be brought directly under the
Fourteenth Amendment in light of Congress' express provision in 42 U.S.C. {
1983 for a damage remedy against state officials who have violated federal
law.  The Court in Bivens created a remedy against federal officials, who
are not subject to liability in { 1983 actions.  "Indeed, one of the reasons
the Court in Bivens held that individuals whose Fourth Amendment rights were
violated by federal officials had an implied cause of action for damages
directly under the Constitution was that no other remedy was available."
Tarpley v. Greene, 684 F.2d 1, 10 (D.C. Cir. 1982); see Zagrans, "Under
Color of" What Law:  A Reconstructed Model of Section 1983 Liability, 71 Va.
L. Rev. 499, 591 n.472 (1985); Blackmun, Section 1983 and Federal Protection
of Individual Rights -- Will the Statute Remain Alive or Fade Away?, 60
N.Y.U. L. Rev. 1, 22 (1985) ("in Bivens, the Court put together a working
equivalent of { 1983 for constitutional claims against federal officials");
cf. Bush v. Lucas, 462 U.S. 367, 380-90 (1983) (no damages remedy implied
directly from Constitution where Congress has provided statutory remedies).
     Plaintiffs rely on several early cases seeking refunds of state or
local taxes claimed to be unconstitutional.  Iowa-Des Moines National Bank
v. Bennett, 284 U.S. 239 (1931); Carpenter v. Shaw, 280 U.S. 363 (1930);
Ward v. Love County, 253 U.S. 17 (1920); Gaar, Scott & Co. v. Shannon, 223 U.S. 468 (1912); Atchison, Topeka & Santa Fe Ry. v. O'Connor, 223 U.S. 280
(1912).  But none of these cases expressly provide a right of action
directly under the Constitution.  Indeed, four of them were initiated in
state court and presumably were founded on state law causes of action.
Only Atchison began in federal court, but the opinion does not specify on
what basis federal jurisdiction was grounded.  In any event, all these cases
long predate the development of modern { 1983 law, beginning with Monroe v.
Pape, 365 U.S. 167 (1961).  Finally, none of the cases cited by plaintiffs,
except Atchison, address the question raised in this case, namely, whether
an action seeking a refund of unconstitutionally levied taxes survives a
state's assertion of sovereign immunity; and Atchison discusses sovereign
immunity only obliquely:  "If he [the defendant Secretary of State] had no
right, as he had not, to collect the money, his doing so in the name of the
State cannot protect him."  223 U.S.  at 287.  Atchison previews the Court's
recent decision in McKesson Corp. v. Division of Alcoholic Beverages and
Tobacco, ___ U.S. ___, ___, 58 U.S.L.W. 4665, 4668-69 (June 4, 1990), that
due process requires that states provide a meaningful remedy for taxpayers
challenging the constitutionality of their tax obligations.  Atchison does
not, however, say that a taxpayer may overcome sovereign immunity in a suit
brought directly under the Fourteenth Amendment.  Recent Eleventh Amendment
decisions demonstrate the Supreme Court's unwillingness to override
sovereign immunity absent a clear statement by Congress to that effect.
See, e.g., Atascadero State Hospital v. Scanlon, 473 U.S. 234, 243 (1985).
Federal sovereign immunity was not an issue in Bivens and its progeny
because those cases involved suits not against the sovereign but against
federal officials in their personal capacities.  See Carlson v. Green 446 U.S. 14 (1980); Davis v. Passman, 442 U.S. 228 (1979).

FN8.    On September 9, 1985, this Court remanded the matter to Washington
Superior Court.


FN9.    "[N]or shall any State deprive any person of life, liberty, or
property, without due process of law."  U.S. Const., amend. XIV, { 1.


FN10.     Neither { 8914 nor any other provisions of Chapter 219 of Title 32
("Motor Vehicle Purchase and Use Tax") specify a limitations period for
actions before the Commissioner pursuant to { 8914.  Cf. 12 V.S.A. { 517
(one-year limitation period on actions in court to recover taxes paid under
protest).  We do not here decide what, if any, statute of limitations is
generally applicable to such actions.


FN11.     The United States Supreme Court declared the tax scheme facially
invalid under the Equal Protection Clause; Williams and Levine continue to
argue that the statute, even as interpreted and administered by the
Department, violates the Privileges and Immunities and Commerce Clauses.


FN12.     Even if the declaratory issues were justiciable, "the courts look
with disfavor on piecemeal litigation of the matters in controversy."  10A
C. Wright, A. Miller & M. Kane, Federal Practice and Procedure: Civil {
2759, at 648 (2d ed. 1983) (hereinafter Wright, Miller & Kane).  Thus,
"federal courts have expressed a strong preference that issues of state
taxation be litigated in state courts through a suit for refund rather than
in federal courts through a suit for declaratory or injunctive relief."
Alcan Aluminium Ltd. v. Department of Revenue of State of Oregon, 724 F.2d 1294, 1298 (7th Cir. 1984).  The disfavor toward piecemeal litigation,
however, is not generally treated as jurisdictional, but rather as a matter
of discretion.  See 10A Wright, Miller & Kane { 2759; cf. 12 V.S.A. { 4716
("The court may refuse to render or enter a declaratory judgment or decree
where such judgment or decree, if rendered or entered, would not terminate
the uncertainty or controversy giving rise to the proceeding.").  Similarly,
"[d]eclaratory relief ordinarily should not be granted if a special
statutory proceeding has been provided for the determination of particular
questions."  10A Wright, Miller & Kane { 2758, at 642.  This rule of
abstention may be circumvented in the court's discretion.  For example, in
Katzenbach v. McClung, 379 U.S. 294, 296 (1964), which upheld the
constitutionality of federal law prohibiting racial discrimination at
restaurants, the Supreme Court reached for the merits although the
plaintiffs had not pursued their claims as provided by statute, because
interference with government action had already occurred (the district court
had enjoined the government from enforcing the Civil Rights Act against the
restaurant) and the constitutional issues were already before the Court in a
companion case.  Id.  These considerations are not present here, and we do
not decide whether the rule applied in Demag and Trivento would give way
were similar considerations present.


FN13.     The facts in the present cases and in Zwickler must be
distinguished from those cases where plaintiffs demonstrate a strong
likelihood of a recurrence of the controversy in litigation.  For example,
in Washington v. Harper, ___ U.S. ___, 58 U.S.L.W. 4249 (Feb. 27, 1990), a
mentally ill prisoner sought declaratory relief regarding prison procedures
for forced medication.  The Supreme Court there took particular note that
given Harper's medical history, it remained likely that officials would seek
to administer antipsychotic medications to him in the future.  Id. at ___,
58 U.S.L.W. at 4252.  The Court accordingly reached the merits.