COA: Individuals Have Standing To Serve As Representatives Of Class Including Corporations

In Dunn v. State, filed today, the COA held that individuals could serve as class representatives of not only individuals, but also of corporations, and affirmed class certification. The plaintiffs alleged that the State impermissibly taxed taxpayers, including individuals and corporations, on interest from municipal bonds issued by state and local governments outside North Carolina, while not taxing interest from municipal bonds issued by North Carolina state and local governments.

The COA held, among other things, that the individual named plaintiffs had standing to represent not only individual tax payers but also non-individual taxpayers such as corporations. While the COA recognized that non-individual taxpayers are governed by different statutes and, at least in the case of corporations, different income taxation rates, the different governing statutes were very similar. The COA found "[m]ost significant[]" that the allegedly unconstitutional statutes, which provide for taxation of non-North Carolina municipal bond interest but not North Carolina municipal bond interest, are the same for individuals and non-individuals. The named plaintiffs' interest in the lawsuit affecting corporations was, therefore, held to be personal and not merely technical.