Argument of Speaker
Mr. Speaker: The opinion of the court in Reich against Collins will be announced by Justice O'Connor.
Argument of Justice O'Connor
Mr. O'Connor: This case comes to the court on writ of certiorari to the Supreme Court of Georgia.
For many years federal retirees such as the petitioner Charles Reich paid Georgia income tax, on their federal retirement benefits.
Even now, Georgia exempted state retirees from paying income tax on their state retirement benefits.
In 1989, we held in a case called Davis versus Michigan Department of the Treasury, that such a state tax scheme violates the constitutions intergovernmental tax immunity doctrine.
Relying on a Georgia statute that requires refunds for illegally assessed taxes, right and other Georgia federal retirees for suit in Georgia State Court, seeking refunds of the unconstitutional taxes they had paid in the years before the 1989 decision of this court.
The trial court denied the refund claims and the Georgia Supreme Court affirmed holding for the first time that the state's refund statute does not apply where as here taxes are paid under a state scheme that is subsequently declared to be unconstitutional.
Right eventually petition this court for review of that decision on the ground that even if a Georgia statute did not require refunds.
Federal due process does as established in our line of this court's decisions most recently our 1990 McKesson decision.
We granted the writ of certiorari and remanded the case back to the Georgia Supreme Court to reconsider it's decision in light of the McKesson line of cases.
On remand the Georgia Supreme Court again denied refunds to the plaintiffs.
This time on the grounds that on the Georgia High Court's reading of the McKesson's cases, the Georgia federal retiree should have challenged the disputed taxes before paying them under procedures that Georgia says, it provides for that purpose.
We now hold that the Georgia Supreme Court erred in relying on Georgia's predeprivation procedures to deny relief.
The court was no doubt right, that under the McKesson cases a state may require taxpayers to challenge unconstitutional taxes before paying them rather than after but what a state may not do and what Georgia did here is to reconfigure its remedial scheme unfairly in midcourse.
Specificaly throughout the 1980s, Georgia held out what plainly appeared to be a clear and certain postdeprivation remedy.
Its tax refund statute and then it declared only after right and others like him had paid the disputed taxes that no such remedy existed.
In this regard the Georgia Supreme Court's reliance on Georgia's predeprivation procedures was beside the point because even assuming a constitutional adequacy of these procedures; no reasonable taxpayer would have thought they represented the exclusive remedy for unconstitutional taxes.
Accordingly the judgment has reversed and the cases remanded for the provision of meaningful backward looking relief consistent with due process.
The opinion of the court is unanimous.
