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Court of Appeal, Second District, Division 3, California.

Philip R. HECKENDORN, Plaintiff and Appellant, v. CITY OF SAN MARINO, Defendant and Respondent.

Civ. B003876.

Decided: December 21, 1984

Philip R. Heckendorn, San Marino, in pro. per., for plaintiff and appellant. McCutchen, Black, Verleger & Shea and Howard J. Privett, Los Angeles, for defendant and respondent.

Plaintiff and appellant Philip R. Heckendorn (Heckendorn) appeals from an order of dismissal following the sustaining of a general demurrer to his complaint without leave to amend in favor of defendant and respondent City of San Marino (the City).

Because the trial court abused its discretion in sustaining the demurrer without leave to amend and dismissing the action, the order is reversed.


On or about February 25, 1983, the City drafted Ordinance No. 851 (the Ordinance) pursuant to the authority of Government Code section 53978,2 which was approved by two-thirds of the City voters on June 7, 1983.   The thus enacted Ordinance purports to levy a “special,” as distinguished from an “ad valorem” tax, on real property for police and fire services, in accordance with the limitations set forth in California Constitution, article XIII A (article XIII A).3

The tax is based upon zoning classifications determined by real property parcel size, and imposes fixed charges against comparably-sized parcels.4

Heckendorn's property is located within the City and was taxed pursuant to the Ordinance.   On July 26, 1983, Heckendorn filed a complaint for declaratory relief and an injunction alleging that the Ordinance violates article XIII A because it creates an ad valorem tax against real property in excess of the limitation imposed on such taxes, and further that the City had created an unlawful lien against his property and a putative personal debt owing by him to the City.   Heckendorn attached a copy of the Ordinance to his complaint as exhibit A.

The City demurred on the ground that no cause of action existed because the Ordinance provides for a tax that is specific in nature rather than ad valorem.   On September 9, 1983, the City's general demurrer was sustained without leave to amend, and Heckendorn appealed.


Heckendorn contends the trial court abused its discretion in sustaining the general demurrer without leave to amend because there is a reasonable possibility that any defect can be cured by amendment.

The City counters that the tax is specific as a matter of law, and therefore the complaint's fatal defect cannot be cured by amendment.


1. Appellate review of demurrer.

 The function of a demurrer is to test the sufficiency of a plaintiff's pleading by raising questions of law.  (Buford v. State of California (1980) 104 Cal.App.3d 811, 818, 164 Cal.Rptr. 264.)

 The allegations in the complaint are to be liberally construed with a view toward substantive justice between the parties.  (King v. Central Bank (1977) 18 Cal.3d 840, 843, 135 Cal.Rptr. 771, 558 P.2d 857.)   “Liberality in permitting amendment is the rule, not only where a complaint is defective as to form but also where it is deficient in substance, if a fair opportunity to correct the substantive defect has not been given.”   (Greenberg v. Equitable Life Assur. Society (1973) 34 Cal.App.3d 994, 998, 110 Cal.Rptr. 470.)   Unless the complaint shows on its face that it is incapable of amendment, denial of leave will constitute an abuse of discretion.  (King v. Mortimer (1948) 83 Cal.App.2d 153, 158, 188 P.2d 502.)

 On appeal the court is not concerned with a party's possible difficulty or inability in proving the allegations of the complaint (Highlanders, Inc. v. Olsan (1978) 77 Cal.App.3d 690, 697, 143 Cal.Rptr. 679), but only that the party may be entitled to some relief.  (Alcorn v. Anbro Engineering Inc. (1970) 2 Cal.3d 493, 496, 86 Cal.Rptr. 88, 468 P.2d 216.)

Giving credence to Heckendorn's theory of his case, supported by an attached copy of the Ordinance which is incorporated within the complaint by reference, his original and only complaint does not show on its face that it is incapable of amendment.   Therefore, Heckendorn should be given a fair opportunity to correct any substantive defect.

2. Heckendorn's proposed amendment.

On appeal, Heckendorn argues that had he been allowed to amend his complaint, he would have added allegations augmenting and clarifying the cause of action originally pleaded substantially as follows:  “Proposed Amended Count # 1 [¶ By its terms (section 2) the Ordinance levies a tax against each parcel of real property located in the City ․ based on a system of ‘residential zones,’ with the tax assessment increasing as the size of the parcels within each ‘zone’ increases.   Said ‘zones' are not true zones in the conventional land use planning sense.   They are, rather, a grid descriptive of property development which has already occurred in the City.   The City is rather unique in that land development within the City is very homogeneous and devoted almost exclusively to single family residences:  no buildings exceed two stories in height;  there are no multi-family dwellings, no apartments, no bars, no shopping malls, no auto dealers, no theatres, etc.   The only variable element in the entire ‘zone’ system is the minimum size of the lot on which a single family residence may be constructed.   Certain patterns of size, quality, and value of single family residences (the predominant land use within the City) had emerged prior to the time of adoption of the ‘zone’ system, and long prior to the adoption of Ordinance No. 851, and it is those characteristics which the zone system seeks to perpetuate.   Accordingly, the San Marino ‘zones' (describing as they do the de facto lot sizes within each geographical area denominated as a zone) do bear a direct relationship to values of the real properties within each ‘zone’, notwithstanding that Section 2(d) of the Ordinance self-servingly alleges to the contrary.  [¶ ] Proposed Amended Count # 2 [¶ ] The San Marino ‘zone’ system was in place long before enactment and adoption of Ordinance No. 851, and therefore said zone system is not and was not enacted ‘pursuant to’ California Government Code § 53978, notwithstanding that Section 1 of Ordinance No. 851 states that the Ordinance, and by implication the ‘zone’ system referred to in the Ordinance, are adopted pursuant to said Section 53978.  [¶ ] Proposed Amended Count # 3 [¶ ] A predecessor to Ordinance No. 851 was drafted by the Council in mid-1982 and was submitted to the voters on November 2, 1982 as ‘Measures X&Y’ and was defeated.   The Council subsequently, at a public hearing, expressed the opinion that a major factor in the defeat of Measures X&Y was a feeling among property owners in the City that the tax system embodied in Measures X&Y was unfair in that the owner of a smaller less valuable parcel (e.g., in ‘zone VII’) was required to pay just as much tax as the owner of a larger more valuable parcel (e.g., in ‘zone I’).   This was perceived as a ‘specific ’ (as contrasted to ‘ad valorem’) tax, and the voters rejected it for that reason.   In order to overcome local voter resistance to a specific levy, the Council devised Ordinance No. 851 as a means of distributing the proposed tax burden among property owners more fairly:  i.e., the amount of tax increases as the value of the taxed property increases;  this reflects the commonly accepted standard of fairness, or ‘uniformity’, in ad valorem property taxation.   Fairness was accomplished not by correlating the tax to the appraised value of each property (as could be done in adopting the assessed valuations developed by the Los Angeles County Tax Assessor for each parcel within the City;  but such a practice would constitute, too obviously, an ‘ad valorem’ tax), but rather by correlating the tax to the values which are, de facto, reflected in the existing City ‘zone’ system.   This is less obviously, but just as truly, an ‘ad valorem’ system of taxation.”

This proposed amendment would cure ambiguity or uncertainty as to the pleading that the subject tax is equivalent to the prohibited ad valorem tax.   However, with respect to the original complaint, an analysis of the Ordinance incorporated therein, discloses on its face a total correlation between the size of the residential parcels in the various zones and the amount of the levy, with the largest ones in zone I being assessed the highest amount, and thereafter in descending order, the smallest in zone VII being taxed the least.   The Ordinance also shows that commercial parcels in the commercial zones, though very small, are assessed comparatively higher taxes, which is consistent with the generally accepted premise that commercial property is more valuable than residential.   This pleading alone should have put the trial court on notice that an amended complaint was in order.

The information from the Ordinance raises the reasonable inference that a correlation exists between the value of each parcel and the amount of tax levied on said parcel, and presents a question of fact as to whether the tax is essentially ad valorem in nature.

3. The meaning of “ad valorem” tax on real property.

Heckendorn posits that the sole issue raised by the City's demurrer is whether the tax imposed by the Ordinance constitutes, as a matter of law, the imposition of “ad valorem taxes on real property” within the meaning of article XIII A.   Heckendorn argues the trial court's ruling that under no circumstances could the tax levied by the Ordinance be construed as such is “wholly without basis under existing California law, either statutory or decisional.”

Both sides suggest that the issue turns on the definition of “ad valorem taxes on real property” and proceed to cite definitions of that phrase which arguably support their respective positions.

(a) Heckendorn's definition.

Heckendorn seeks interpretive assistance from Amador Valley Joint Union High Sch. Dist. v. State Bd. of Equalization (1978) 22 Cal.3d 208, 149 Cal.Rptr. 239, 583 P.2d 1281.   The Proposition 13 initiative was adopted by the California voters in June 1978, which thereby added article XIII A to the California Constitution;  Amador held the article constitutional.

The section in question reads simply:  “The maximum amount of any ad valorem tax on real property shall not exceed one percent (1%) of the full cash value of such property.”   No definitions are set forth as to the meaning of the phrase “ad valorem tax on real property.”   However, Amador directs that in spite of the existence of several words and phrases which assertedly are ambiguous or uncertain, without referring to this particular phrase, many, if not most, of the uncertainties “may disappear if a reasonable, common sense approach is used in the interpretation of article XIII A.”  (Id., 22 Cal.3d at pp. 244, 248, 149 Cal.Rptr. 239, 583 P.2d 1281.)

The Amador court citing County of Nevada v. MacMillen (1974) 11 Cal.3d 662, 674, 114 Cal.Rptr. 345, 522 P.2d 1345, also instructs that “it seems apparent that we cannot, and should not, attempt to pass upon the meaning or validity of each contested provision in every hypothetical context—adjudication of these matters must await an actual controversy, and should proceed on a case-by-case basis as the need arises.”

Heckendorn relies on the simple definition set forth in Revenue and Taxation Code section 2237.3, subdivision (f) that “․ an ‘ad valorem property tax’ means any tax or assessment imposed on the basis of the value of the real property, ․”, and Revenue and Taxation Code section 10758 dealing with the subject of “ad valorem taxes” which states “․ all taxes according to value ․”

Heckendorn contends the concept of an “ad valorem” tax embodied in the above two sections, namely a tax based generally on value, without reference to “rate” or the intervention of “assessors,” is as likely a proper source for construction of the term “ad valorem” as used in article XIII A, section 4, as is the definition relied on by the City found in Revenue and Taxation Code section 2202.  Article XIII A, section 4, again refers merely to “ad valorem taxes on real property.”  Revenue and Taxation Code section 2202 reads “ ‘Ad valorem property taxation means any source of revenue derived from applying a property tax rate to the assessed value of property.’ ”

(b) The City's position.

 While maintaining that the tax is specific in nature, the City also recognizes that there is no single, comprehensive definition of the term “ad valorem” which encompasses this particular tax, but insists that the “widely-accepted and often-quoted” principle that “ad valorem” taxation necessarily involves the application of a tax rate to the value of the taxed property, should prevail.

The City cites as sources for this principle Black's Law Dictionary (4th Rev.Ed.1968) page 58:  “Duties are either ad valorem or specific;  the former when the duty is laid in the form of a percentage on the value of the property;  the latter where it is imposed as a fixed sum on each article of a class without regard to its value.”  (Emphasis added.)

It also relies on the second edition of American Jurisprudence, the Oxford English Dictionary, and Revenue and Taxation Code section 2202.   These sources refer to estimated and assessed value.   The City also uses 7 out-of-state cases standing for the proposition that an ad valorem tax is invariably one imposed on the basis of value.

It is fair to say that no disagreement exists in case or statutory law, nor between the parties, as to such a general proposition.   Rather, the issue raised by the arguments of the parties seems to put in issue the definition of value, given that an ad valorem tax is always one on value.

4. Definition of “value” irrelevant.

 The City argued before the trial court in support of its general demurrer that an ad valorem tax must contain the elements of a “rate” applied to an “assessed” value, consistent with Revenue & Taxation Code section 2202.

Article XIII A, section 1, does not refer to a “rate” and uses the term “full cash value.”   In discussing article XIII A, the Amador court uses the term “value” in a number of different ways, including “full cash value,” “assessed value,” “appraised value,” and “fair market value.”   California Administrative Code, volume 13, title 18, section 460, defines certain other “value” concepts termed “restricted value,” “full value,” and “taxable value.”

Heckendorn offers that both sides now appear to agree that an ad valorem tax on real property is one which is based on value with which we concur, whether or not the mechanism of the tax contains a “rate” or an “assessment.”   Indeed, it would seem that how “value” is exactly defined is irrelevant for the purposes under discussion.   Provided “value” is measured by some means, it matters not what that precise measure is.   Our interpretation would be in line with the spirit of Amador as a “reasonable, common sense approach [to be] used in the interpretation of article XIII A.”  (Amador Valley Joint Union High Sch. Dist. v. State Bd. of Equalization, supra, 22 Cal.3d at p. 248, 149 Cal.Rptr. 239, 583 P.2d 1281.)

5. Question of fact presented by the pleadings.

 While we agree with the City that its enactments are entitled to the same presumption of validity enjoyed by other legislative authorities (Hopkins v. Galland Mercantile L. Co. (1933) 218 Cal. 130, 133, 21 P.2d 553), Heckendorn's position that he should be entitled to pursue whether a relationship exists between the tax levied and the values of the properties taxed by way of an amended complaint is very persuasive.   The self serving language of the Ordinance that “the tax shall not be measured by the value of the property” is not controlling;  rather, the overall effect of the Ordinance is determinative.

 Heckendorn claims that the Ordinance's de facto effect on properties taxed within the various “zones” is a matter which can clearly be determined by the introduction before a trier of fact of available statistical evidence, and that such evidence will conclusively prove a direct relationship between values and taxes throughout the City.

As indicated, it may be that Heckendorn's original complaint read together with the Ordinance as a part thereof was sufficient to warrant an amendment.   His proposed amendments to the complaint, which again presumably would incorporate the Ordinance, will surely withstand demurrer scrutiny.

The good citizens of the City who voted for the Ordinance were probably among the millions of Californians who also voted for Proposition 13.   They, along with the rest of us, are now bound by it.   They cannot enact what they perceive to be a “fair” tax to provide the funds necessary for additional fire and police protection for their community if such tax is contrary to what is now a part of the California Constitution in the form of article XIII A.   With respect to the nature of the tax in issue, we “would invoke the folk wisdom that if [something] looks like a duck, walks like a duck and quacks like a duck, it is likely to be a duck.”  (In re Deborah C. (1981) 30 Cal.3d 125, 141, 177 Cal.Rptr. 852, 635 P.2d 446 [conc. opn. of Mosk, J.] ), and we conclude that fact finders should be the determiners.


The trial court abused its discretion in sustaining the City's general demurrer to Heckendorn's original complaint without leave to amend because the complaint can be amended to state a cause of action.


The order of dismissal is reversed.   Each party to bear costs.


1.   The facts were developed from the pleadings.

2.   Government Code section 53978 reads in pertinent part:  “Special tax [¶ ] (a) Any local agency which provides fire protection or prevention services directly, ․, or which provides police protection services, may, by ordinance, determine and propose for adoption a special tax for fire protection and prevention provided by the local agency, or a special tax for police protection services provided by the local agency, or both ․, other than ad valorem property taxes, pursuant to this section.   The legislative body may establish zones or areas within the local agency and may restrict the levy of the special tax to those zones or areas.   Such proposition shall be submitted to the voters of the affected area or zone, or of the district, and shall take effect upon approval of two-thirds of the voters voting upon such proposition․  [¶ ] (b) The ordinance submitted to voter approval ․, shall specify the amount of each of such special taxes.   Each of such special taxes shall be levied on a parcel, ․, for the purpose of obtaining, furnishing, operating, and maintaining fire suppression and police protection equipment or apparatus ․, for paying the salaries and benefits to firefighting and police protection personnel ․, and for such other necessary fire protection and prevention expenses and police protection expenses, ․”  (Emphasis added.)

3.   The initiative known as Proposition 13 was adopted in June 1978 and thereby article XIII A was added to the California Constitution, which reads in part:  “§ 1.   Ad valorem tax on real property;  maximum amount [¶ ] Section 1. (a) The maximum amount of any ad valorem tax on real property shall not exceed one percent (1%) of the full cash value of such property.   The one percent (1%) tax to be collected by the counties and apportioned according to law to the districts within the counties․ [¶ ] ․ [¶ ] § 4.   Special taxes;  imposition [¶ ] Sec. 4.   Cities, counties and special districts, by a two-thirds vote of the qualified electors of such district, may impose special taxes on such districts, except ad valorem taxes on real property or a transaction tax or sales tax on the sale of real property within such City, County or special district.”  (Emphasis added.)

4.   The proposed Ordinance was exhibit A to Heckendorn's complaint in part:C1-8SAN MARINO POLICE AND FIREC1-2ResidentialC3No.ResidentialC6-7Levy and AssessmentC1-2ZonesC3ParcelsFactorC51983-84   1984-85 1985-861986-87 IS14(22,500)  2713.00$ 588$ 645$ 731$ 818II(20,000)  3752.63       489       565 641S11717III(17,000)   232.19       407       470       533596IV(15,000)  3531.89       352       407       461516V(12,000)1,4991.44       268       310       351393VI(10,000)  6741.15       214       247       280314VII( 9,000)1,2941.00       186       215       244273 L1-3Commercial Zones I (-50′)   31       450       520       590660II(50′-100′)*   80       700       809 9171,026III(100′+)   31     1,200     1,386     1,5721,759 L1-3Miscellaneous ZonesL1-2Unimproved   42        99       114       130145SplitS8    7        69        80        90101L1-2Unassessable  1054,740 L1-3Sub Total Zone Charges$1,358,283$1,570,008$1,779,565$1,991,642L1-2Less Credits  (67,965)  (80,465)  (92,965)(105,465)L1-3Huntington Library    10,000    11,552 13,10414,656L1-2TOTAL$1,300,318$1,501,095$1,699,704$1,900,833“CREDITS SUMMARY—PARCELS SOLD AFTER 3/01/75_“Homes purchased in 1975—$20; 1976—$20; 1977—$25; 1978—$30; 1979—$35; 1980—$40; 1981—$45; 1982-87—$50.* “Including churches, non-profit property holdings and the like.“(a) The zones shall be those designated on the official zone map of the City, and the parcels shall be those described in the “Report” filed January 31st in the office of the City Clerk as to which individual notices were previously mailed.“(b) An official (tax levy) Assessment Book designating the proposed tax on each parcel is on file in the office of the City Clerk and is incorporated herein by reference.“(c) The records of the Los Angeles County Assessor as of March 1st of each year preceding the applicable fiscal year shall determine whether or not any particular lot is unimproved for the purposes of this section. “Parcel of property” as used in this Ordinance shall mean any contiguous unit of improved or unimproved real property held in separate ownership, including, but not limited to, any single family residence, or any other unit of real property subject to the California Subdivided Lands Act (Business and Professions Code, Section 11000, et seq.).“(d) The tax imposed by this Ordinance shall be a tax upon each parcel of property, and the tax shall not be measured by the value of the property.“(e) As required by Government Code, Section 53978(b), the City Council has determined that 59.5 percent of each levy of such special tax shall be for police protection, and that 40.5 percent shall be for fire protection.“SECTION 3. The special tax imposed by Section 2 shall be due in two equal installments in accordance with the collection procedures of the Los Angeles County Tax Collector with the first installment for the first fiscal year, to wit: 1983-84 being due November 1, 1983, and the second installment for said fiscal year being due on February 1, 1984. The special tax for subsequent fiscal years shall be due on the same basis, in the same manner, and on the same applicable dates as established by law for the due dates for the other charges and taxes fixed and collected by the County of Los Angeles on behalf of the City of San Marino.“ ․“SECTION 9. The special tax imposed hereby shall be collected in the same manner, on the same dates, and subject to the same penalties and interest in accordance with the established dates as, or with, other charges and taxes fixed and collected by the County of Los Angeles on behalf of the City of San Marino and the said County may deduct its reasonable costs incurred for such service before remittal of the balance of the City.“Said special tax, together with all penalties and interest thereon, shall constitute a lien upon the parcel upon which it is levied until it has been paid, and said special tax, together with all penalties and interest thereon, shall, until paid, constitute a personal obligation to the City of San Marino by the persons who own the parcel on the date the tax is due.”

KLEIN, Presiding Justice.

LUI and DANIELSON, JJ., concur.