Specialty Restaurants Corp. v. County of Los Angeles

In these consolidated actions Specialty Restaurants Corporation and PSA Hotels, Inc. (Taxpayers) seek to recover that portion of possessory interest taxes paid under protest and claimed to have been erroneously assessed and apportioned to the submerged land underlying the vessel Queen Mary. Taxpayers’ interests are derived from long term leases with the City of Long Beach, owner of the Queen Mary project, whereby lessees were given exclusive rights to conduct hotel, food, beverage and other commercial activities on premises located aboard the Queen Mary, together with exclusive parking rights on land adjacent thereto and options for use of additional nearby land areas. The leases, under heading “Miscellaneous Provisions Premises” define premises to be “Part of Realty” and: “For all purposes of law relating to leases, conveyances and licenses, leased premises shall at all times be regarded as a permanent fixture to the real property upon which said Queen Mary lies.”

The trial court found that: “1. At all relevant times herein, to wit tax years 1972-1973, 1973-1974, 1974-1975, each plaintiff has been and is a lessee of premises in, on and to the former vessel Queen Mary,…