Trimble v. City of Seattle

Background

Companies and individuals holding long-term leases of state-owned tidelands challenged a city reassessment. The leases were made in 1899. Washington passed laws in 1905 and 1907 allowing cities of the first class to put such leaseholds into local improvement districts and assess them for projects. The City of Seattle built a plank roadway, formed an improvement district, and imposed a reassessment after an earlier assessment failed. The leaseholders argued the leases implied the State promised the land would be free of such charges and that later laws impaired their constitutional rights.

Reasoning

The Court focused on whether a lease by the State included an implied promise that would prevent later taxation or assessments. It explained that the implied covenant that sometimes shifts tax liability in private leases is a legal doctrine, not simply the literal words of a contract, and that imposing such a promise on the State would restrict important sovereign power to tax. The Court agreed with the Washington Supreme Court that state policy excludes a constructive obligation shielding state leases from assessments. Because the leases did not carry a state-created immunity, the city’s reassessment was lawful.

Real world impact

The ruling leaves in place the state-court judgment that waterfront leaseholds from the public domain can be included in local improvement districts and assessed for improvements. Leaseholders on state tidelands cannot rely on an implied exemption from such local charges under these leases, and cities retain authority to levy reassessments authorized by state law.