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Sovereign Immunity Among Political Subdivisions?

The Georgia Supreme Court sent an intergovernmental dispute over taxation of alcoholic beverages back to the lower court.  This case arose out of a dispute over the allocation of taxes on alcoholic beverages at the Atlanta airport.  The court remanded the case to consider the following question: “Whether sovereign immunity applies at all in suits between political subdivisions of the same sovereign (like the City and the County).” 

The trial court ruled that sovereign immunity did not apply, but the cases on which it relied did not involve intergovernmental claims.  In addition, after the trial court’s ruling but before this appeal, the Supreme Court issued its opinion in Lathrop v. Deal, — Ga. –, 2017 WL 2625463 (June 19, 2017), in which it broadly interpreted the protection of sovereign immunity, except as to certain constitutional claims such as “takings.”  As a result, the trial court’s opinion did not incorporate the holding of the recent Lathrop opinion.

Accordingly, the Supreme Court sent the case back to consider the threshold question of whether sovereign immunity applies to claims between political subdivisions of the same sovereign.  “It is a complex and important question, and one that we are reluctant to address in the first instance without affording the trial court an opportunity to consider the question and without complete briefing by the parties.”

The case is Clayton County v. City of College Park, — Ga. –, 2017 WL 2822465 (June 30, 2017).  Read the case here.