Fisher

In this appeal, we consider a challenge to a municipal real estate transfer tax. R. Frederic Fisher and Susan K. Fisher (hereafter Fishers), brought a suit for declaratory relief and tax refund against the City of Berkeley and the County of Alameda (hereafter respondents), alleging that the city’s real estate transfer tax violated section 4 of Proposition 13 (now art. XIII A, § 4, of the Cal. Const.) and a related provision of Proposition 62 (Gov. Code, § 53725). Respondents joined in a demurrer to the complaint which the trial court sustained without leave to amend. The Fishers filed a timely notice of appeal.

The City of Berkeley is a charter city enjoying home rule over municipal affairs under article XI of the California Constitution. On June 30, 1978, shortly before the effective date of Proposition 13, the Berkeley City Council adopted an ordinance, later codified in Berkeley Municipal Code section 7.52.040 et seq., which imposed a tax of one percent on the value of the consideration for real estate transfers. The ordinance exempted properties that were occupied by the owner for five years prior to the transaction. In August 1991, the city council amended the…