Tuesday, January 05, 2010

Sanchez v. Aerovias De Mexico (9th Cir. - Jan. 5, 2010)

When I was clerking on the Ninth Circuit and had drafted an opinion (or, especially, a dissent), I often took it to the judge and found -- draft after draft -- that he had added long arguments with absolutely no citations whatsoever. I distinctly recall thinking: "Don't you want some citations for these arguments? Don't you actually want to support what you're saying?"

Needless to say, I kept these thoughts to myself. But I still thought them. The stuff that I drafted was very authority- and case-centered, likely influenced by my background. And I thought that made for a better opinion.

Which I'm sure it sometimes does. But in my old age, I now understand that there's another way to write. The way my judge did. And that it's often much more powerful than the way I was used to. Or, in short, that longtime judges sometimes know quite a bit more about how to write an opinion than people who graduated from law school the previous year.

I flashed back to all of this when I read this morning this dissent by Judge Kleinfeld. It's to an Airline Deregulation Act ("ADA") case, so this is hardly something that gets your blood boiling. Nor is Judge Rymer's majority opinion -- which holds that the plaintiff's claims are preempted by the ADA -- outrageous or anything like that. So the power of the dissent is not that it tugs on your political heartstrings.

Rather, the thing about the dissent is that, at least to me, it's incredibly well-written. It tells a story. Not a narrative, but a vision. And does so on a common sense basis, and largely without interruptions from citations (which are relegated to the occasional footnote).

Is the dissent a bit overly simplistic in a couple of places? Yeah, I think so. Nonetheless, I really thought this was exceptionally good, and stunningly well-written. The whole thing is six single-spaced pages long, and worth reading in full, but here's a (long) snippet:

"I respectfully dissent. In my view, Sanchez’s claim is not preempted, so we should reverse. The error in the majority’s result derives from its error in concluding that “the ticketed price included the tourism tax.” It did not. As the majority apparently concedes, Sanchez’s contract included the website language, “the user shall remain fully liable for all . . . taxes . . . .” That means taxes attributable to her flight.

The airline collected a $22 tax from every passenger bound for Mexico, but it is undisputed that Mexico imposes this tax only on non-Mexicans, not Mexicans. Sanchez is a Mexican citizen, so Mexico does not impose the $22 tax on her trips to Mexico. The entire class she wishes to represent is exempt from the tax, so significant money is at stake. The airline collected the $22 as part of the $428.43 it charged to her credit card. It did not refund it to her and has no system for doing so. The record does not reveal whether the airline gave the $22 to the Mexican government, which was not entitled to it, or kept it for itself despite taking it under the premise of a tax collected on behalf of the Mexican government. The implication of the airline’s argument appears to be that it gave the $22 to the Mexican government. Sanchez sued for breach of contract and restitution.

The statute preempts state law claims “related to a price, route, or service.” The Supreme Court held in American Airlines v. Wolens that this preemption clause barred a state law claim under a state consumer fraud statute challenging retroactive changes in a frequent flyer program, but that a state law claim for breach of contract would not be preempted. . . . Applying the Wolens language, our task is to distinguish between a state-imposed obligation and one that the airline imposed on itself by making an offer that a customer accepted. Sanchez’s case is the latter sort. The airline offered to fly her to Mexico and back for a stated fare plus taxes. She agreed. Yet the airline charged her more than that. Though it called the $22 a charge for taxes, it was not. She did not owe the tax, and the airline did not owe the tax. This was no more a legitimate charge for taxes than it would be for a store in Fairbanks, Alaska (where there is no sales tax) to charge a
tourist the price of her souvenir plus 8.5% sales tax.

The airline’s answer to this is not that Sanchez owed the tax, or that it owed the tax for flying Sanchez. Instead, it argues that it did not inquire so did not know which of its passengers
were Mexican citizens, so it charged everybody tax whether they owed it or not. That argument does not address whether it breached its contract. If the deal is “the price is $9.95,” and the shop does not give the customers a nickel change from a ten dollar bill, the breach of contract does not somehow disappear because the shopkeeper contends that it would cost him more than a nickel to maintain a cash register, staff, and supply of nickels, to pay customers their change. . . .

About all there is to decide is whether Sanchez’s deal was to pay the Mexican tax whether any tax was imposed by Mexico on her trip or not, or to pay whatever tax was owed. To ask the question is to answer it. Her deal was to pay the fare and to “remain liable for all . . . taxes.” Were we recklessly indulgent, we might say this is ambiguous, maybe she means to contract to pay whatever taxes there may be on anyone, not just her. And maybe the tourist in Fairbanks wishes to pay the sales taxes that would be due were she buying her souvenir in San Francisco instead of Fairbanks. But probably not. We need not even reach application of the doctrine of construing the contract contra proferentem to resolve ambiguity in Sanchez’s favor, because the only sensible construction is that Sanchez agreed to remain liable only for taxes attributable to
her. The tourist who hands the $9.95 objet d’art to the cashier doubtless assumes, if she is from San Francisco, that it will cost her around $10.80, and may well hand the cashier a $20 bill instead of a $10. But her acceptance of an obligation to pay all taxes in addition to the marked price does not mean that she agrees to pay taxes that the city and state do not charge and that she does not owe, so long as the shopkeeper calls the extra money “tax.” She explicitly agrees to pay $9.95 plus whatever tax is due, and since none is due, she (and Sanchez) is entitled to all her change.

Sanchez was not liable for the Mexican tax, never was, and could not “remain liable” for a tax she never owed. This was a tax on non-Mexicans, she is Mexican, and whether the airline kept her money or made gift of it to the Mexican government (a gift, since the Mexican government did not impose the $22 tax on Sanchez or on the airline for transporting Sanchez), Sanchez’s contract was not to pay this tax on people other than herself. Nor does it matter whether the airline provides a procedure for customers to seek refunds of improperly collected taxes. An airline is not like a government agency enjoying a narrowly construed waiver of sovereign immunity. An airline is like the Fairbanks shopkeeper, bound by contract law to charge the customer the marked price plus any tax, and not a higher price in the guise of a tax not due. Sanchez is entitled to sue for breach of contract and restitution of her money under Morales, Wolens, and Charas."

I couldn't have written a better dissent. I'm quite sure about that.