Thompson v. Killian: RPA Limited to Title 12 Taxes; Class Actions Against Local Governments Permitted Outside Property Tax Disputes; Unjust Enrichment Barred by SCTCA

Introduction

In Mark Gregory Thompson and Jane Page Thompson v. Clay Killian, et al., Opinion No. 28305 (S.C. Sup. Ct. Nov. 5, 2025), the South Carolina Supreme Court addressed sweeping questions at the intersection of state tax procedure, local fee authority, class action practice against political subdivisions, equitable remedies against government entities, and constitutional preservation rules.

The appellants—residents of the City of Aiken who also reside in Aiken County—challenged city and county road maintenance fees levied for decades under local ordinances. They sought a declaratory judgment that the fees were unlawful (in light of the Court’s 2021 decision in Burns v. Greenville County Council), refunds, equitable restitution through unjust enrichment, penalties under section 8‑21‑30, and relief under Article I, § 3 of the South Carolina Constitution.

The circuit court dismissed on multiple grounds, principally holding that the South Carolina Revenue Procedures Act (RPA), including section 12‑60‑80’s exhaustion and class action bars, deprived it of subject matter jurisdiction. The Supreme Court affirmed in part, reversed in part, and remanded. Most notably, the Court:

• Held the RPA does not apply to local road maintenance fees because they are not “taxes” within the RPA’s definition—narrowing the RPA to Title 12 exactions or those assessed/collected by the Department of Revenue (DOR);
• Held section 12‑60‑80(C)’s class action prohibition does not bar class actions against political subdivisions except in disputes concerning ad valorem property taxes—thereby allowing the Thompsons’ putative class action to proceed;
• Affirmed dismissal of the statutory penalty claim under section 8‑21‑30; and
• Affirmed dismissal of the unjust enrichment claim on sovereign immunity grounds under the South Carolina Tort Claims Act (SCTCA)—over a partial dissent arguing the SCTCA limits only tort liability, not equitable restitution.

The Court also declined to reach the appellants’ procedural due process claim under Article I, § 3 because it was dismissed by stipulation and the unchallenged ground became the law of the case.

Summary of the Opinion

Justice Verdin’s majority opinion (joined by Chief Justice Kittredge and Justice Few) holds:

• RPA Scope: The RPA’s jurisdictional limits apply only when the disputed charge is a “tax” under section 12‑60‑30(27), meaning it is imposed by Title 12 or assessed/collected by DOR. The Aiken City/County road maintenance fees were enacted under Titles 4 and 6, and DOR neither assessed nor collected them. Therefore, the RPA’s exhaustion and class-action bars do not apply.
• Class Actions Against Political Subdivisions: Reading section 12‑60‑80(C) in light of the RPA’s purpose clause (section 12‑60‑20) and its 2003 amendment (Act No. 69), the “catchall” prohibition on “any other class action” does not categorically extend to political subdivisions for non-property-tax disputes. Instead, the bar reaches political subdivisions only in disputes concerning ad valorem property taxes. The class action here may proceed.
• Section 8‑21‑30: The penalty statute applies only to (a) officers named in Chapter 21 who (b) “charge” fees “for any services herein mentioned.” Road maintenance fees are not among the Chapter 21 service fees, and a treasurer who merely “collects” does not “charge.” The claim fails as a matter of law.
• Unjust Enrichment: Sovereign immunity, restored by the SCTCA except as waived, bars equitable claims such as unjust enrichment. The SCTCA’s contract exception (§ 15‑78‑20(d)) preserves only actions based on contracts, not quasi-contract (implied by law) or other equitable restitution claims.
• Article I, § 3: The due process claim was dismissed by stipulation and that unappealed ground controls under the law-of-the-case and two‑issue rules. The Court therefore does not opine on whether due process protections attach to legislation of general applicability.

Justice Hill, joined by Justice James, concurred in part and dissented in part. He agreed with the majority except as to Section V (unjust enrichment), asserting that sovereign immunity does not bar equitable claims and that the SCTCA constrains tort liability only.

Analysis

Precedents Cited and Their Influence

• Burns v. Greenville County Council, 433 S.C. 583, 861 S.E.2d 31 (2021)

  Burns established that a county road maintenance “fee” that conferred no special benefit on payers beyond the public at large failed the “service or user fee” definition in section 6‑1‑300(6) and was, therefore, an unlawful tax under Title 6. The majority in Thompson carefully cabins Burns to Title 6’s user-fee taxonomy and expressly notes that Burns did not address whether such exactions are “taxes” within the RPA. This distinction is pivotal to the Court’s holding that RPA jurisdictional bars do not apply to these local road fees.

• Aiken v. S.C. Dep’t of Revenue, 429 S.C. 414, 839 S.E.2d 96 (2020)

  Aiken interpreted section 12‑60‑80(C)’s “catchall” to bar class actions against DOR even beyond refund claims, rejecting a narrow “tax refund only” reading. Thompson refines that precedent: while the catchall remains broad as to DOR (consistent with the RPA’s purpose to govern DOR disputes), it does not erect a categorical class-action bar against political subdivisions for non-property-tax disputes. The Court grounds this limitation in the RPA’s purpose clause and the 2003 Act’s title.

• Brown v. County of Horry, 308 S.C. 180, 417 S.E.2d 565 (1992)

  Brown contextualizes local governments’ authority to impose fees post‑Home Rule and informs why Aiken County enacted its road fee in 1992. The case serves as historical backdrop rather than a controlling rule in Thompson.

• Murphy v. Richland Mem’l Hosp., 317 S.C. 560, 455 S.E.2d 688 (1995) and McCall v. Batson, 285 S.C. 243, 329 S.E.2d 741 (1985)

  Murphy recognizes that the SCTCA “first completely restores sovereign immunity” and then sets tailored waivers, notably for torts, while McCall abolished the judge-made sovereign immunity doctrine, precipitating legislative response. The majority uses these cases, together with § 15‑78‑20’s text, to conclude the SCTCA preserves immunity against equitable restitution unless expressly waived for contract claims. The dissent relies on McCall to argue the SCTCA curtails tort exposure but does not re-erect immunity against equity-based claims.

• Myrtle Beach Hosp., Inc. v. City of Myrtle Beach, 341 S.C. 1, 532 S.E.2d 868 (2000)

  Cited to distinguish legal contract claims (at law) from equitable claims (unjust enrichment/quantum meruit). The majority leverages that distinction to confine the SCTCA’s “contract” savings clause to true contract claims, not quasi-contract.

• Statutory interpretation authorities: Miller v. Aiken, Bayle v. SCDOT, Town of Mt. Pleasant v. Roberts, Senate by & through Leatherman v. McMaster, and the 2003 Act No. 69

  The Court relies on familiar textualism: the RPA’s purpose clause (§ 12‑60‑20), the defined term “property tax” (§ 12‑60‑30(18)), the RPA’s tax definition (§ 12‑60‑30(27)), and the 2003 act’s title all constrict 12‑60‑80(C)’s catchall to the RPA’s intended domain—DOR matters and property tax disputes.

• Preservation doctrines: Wilder Corp. v. Wilke, I’On, LLC v. Town of Mt. Pleasant, Jones v. Lott, Anderson v. SCDHPT

  These underpin the Court’s refusal to reach the due process issue because the trial court’s stipulated dismissal was an unappealed ground—now law of the case.

• Due process line: Bi‑Metallic Inv. Co., Atkins v. Parker, Goldberg v. Kelly

  Cited to highlight (but not resolve) whether due process entitlements attach to legislative actions of general applicability versus individualized adjudications.

Legal Reasoning

1) The RPA Does Not Apply to Local Road Maintenance Fees

The Court’s analysis begins with the RPA’s definitions. Section 12‑60‑30(27) defines “tax” as amounts “imposed by this title [Title 12], or subject to assessment or collection by the department.” The Aiken fees were enacted under Titles 4 and 6 (Home Rule/local government finance)—not Title 12—and DOR has no statutory role in assessing or collecting them. Therefore, the RPA’s exclusive remedies provision (§ 12‑60‑80(A)), declaratory-judgment exception (§ 12‑60‑80(B)), and class action bar (§ 12‑60‑80(C)) are inapplicable.

Importantly, the Court harmonizes this with Burns: a local “fee” may still constitute a “tax” under Title 6 if it fails the special-benefit test, but that does not make it a “tax” within the RPA’s narrower, Title‑12‑centric definition. This is a key doctrinal refinement separating substantive tax characterization under Title 6 from procedural jurisdictional rules under the RPA.

2) Section 12‑60‑80(C)’s Class Action Bar Is Limited as to Political Subdivisions

Section 12‑60‑80(C) contains two relevant commands: (i) no class actions “for the refund of taxes” and (ii) DOR, political subdivisions, and their instrumentalities “may not be named or made a defendant in any other class action brought in this State.” Read in isolation, the catchall could sweep broadly. The Court, however, interprets it “in accordance with, and in furtherance of” the RPA’s stated purpose (§ 12‑60‑20): to provide procedures for disputes with DOR and disputes concerning property taxes.

As a result:

• As to DOR, the catchall remains broad (consistent with Aiken).
• As to political subdivisions, the catchall bars class actions only in ad valorem property tax disputes; it does not foreclose class actions in non-property-tax cases—like this one.

The Court emphasizes legislative supremacy: if this delineation diverges from legislative policy, the General Assembly can amend the statute. The judiciary’s role is to apply the text as written and in context.

3) Section 8‑21‑30: Penalties Limited to Officers Charging Enumerated Chapter 21 Fees

Section 8‑21‑30 penalizes any “officer herein named” who “shall charge any other fee or fees for any services herein mentioned,” imposing a forfeiture of ten times the improper amount. The Court identifies two limiting conditions:

• The officer must be one “herein named” in Chapter 21 (e.g., treasurers, clerks, registers of deeds) and the fee must be for a Chapter 21 service (e.g., filing/recording fees enumerated in § 8‑21‑310); and
• The officer must “charge” (i.e., impose) the fee, not merely “collect” it.

Invoking contemporaneous dictionary definitions from 1828 when the statute was enacted, the Court distinguishes “charge” (to impose) from “collect” (to demand and receive), concluding the county treasurer’s collection activities do not trigger § 8‑21‑30, and road maintenance fees are not among Chapter 21 service fees. The claim was properly dismissed.

4) Sovereign Immunity Bars Unjust Enrichment Claims Against Government Entities

The SCTCA first restores sovereign immunity, then waives it to the limited extent specified—primarily for torts. While § 15‑78‑20(d) provides that “[n]othing in this chapter affects liability based on contract,” the Court holds this clause preserves only true contract claims (legal actions based on an express or implied‑in‑fact contract), not equitable restitutionary claims (quasi‑contract/unjust enrichment, implied in law).

Because unjust enrichment is an equitable, extra‑contractual remedy, the SCTCA’s contract clause does not waive immunity for it. The Court’s reasoning is grounded in the legal/equitable distinction recognized in South Carolina law and the SCTCA’s textual focus on torts and contracts. Sovereign immunity therefore bars the Thompsons’ unjust enrichment claim.

Justice Hill dissents on this point, asserting that:

• The SCTCA’s structure and repeated references to “torts” show it curtails tort liability and does not reestablish immunity against equitable claims;
• Historically, sovereigns were amenable to equitable petitions; and
• Post‑McCall, South Carolina’s sovereign immunity doctrine no longer blocks equitable actions absent clear legislative reinstatement, which he finds lacking.

5) Article I, § 3: Preservation and the Two‑Issue Rule

The trial court dismissed the due process claim on two grounds: stipulated dismissal and the unavailability of damages under the state constitution. On appeal, the Thompsons challenged only the latter. Under the two‑issue rule and law‑of‑the‑case doctrine, the stipulated dismissal stands and is dispositive. The Court accordingly declines to address the merits—including whether due process protections attach to generally applicable legislation under South Carolina law.

Impact

A. Revenue Procedures Act (RPA) Scope Narrowed

• Procedural channeling to the RPA will not apply to many local exactions enacted under Titles 4 and 6 and not administered by DOR. Plaintiffs challenging such exactions can proceed in circuit court without exhausting RPA administrative remedies.
• Substantive vs. procedural taxonomy: A charge may be a “tax” under Title 6 (Burns) yet not a “tax” under the RPA. This decouples illegality analysis from the RPA’s jurisdictional bars.
• Legislative response: Expect debate over whether to broaden the RPA’s reach to local exactions, especially where uniform statewide procedures are desired.

B. Class Actions Against Political Subdivisions Revived Beyond Property Tax

• Open class action pathway for non‑property‑tax challenges to local exactions, fees, and possibly other governmental monetary programs not implicating ad valorem property taxes.
• Strategic collection arrangements: If DOR administers or collects a local charge, the broader Aiken reading of § 12‑60‑80(C) may reintroduce a class action bar. Local governments should consider implications when contracting with DOR for collection.
• Exposure: Political subdivisions may face classwide exposure in declaratory/refund suits. Traditional Rule 23 requirements (commonality, typicality, adequacy, superiority) remain hurdles; but the statutory bar is no longer categorical outside property tax disputes.

C. Equitable Restitution Against Government

• Unjust enrichment presently unavailable against the State and its political subdivisions under the majority’s reading of the SCTCA. Claimants must plead and prove statutory causes of action, contract claims, or other recognized waivers.
• Potential future re-examination: Justice Hill’s dissent provides a thorough foundation for revisiting whether sovereign immunity bars equitable claims. Litigants should preserve both positions pending any further high‑court clarification or legislative amendment.

D. Section 8‑21‑30 Enforcement Narrowed

• Penalty scope is narrow: Applies only to enumerated Chapter 21 service fees and to officers who “impose” them. Treasurers and others who only “collect” fees established by ordinance do not face ten‑times penalties under § 8‑21‑30.

E. Declaratory Judgments and Refunds

• The Court remanded the declaratory judgment claim, noting the trial court must address whether and how “further relief” (e.g., refunds) may attach to a declaration of invalidity under § 15‑53‑120 (Uniform Declaratory Judgments Act). Remedies, time limits, and defenses (limitations, voluntary payment, governmental immunities) remain open on remand.

Complex Concepts Simplified

• RPA vs. Title 6 “tax”:
  • “Tax” under the RPA: Only charges imposed by Title 12 or assessed/collected by DOR.
  • “Tax” under Title 6 (local government): A “fee” that fails to confer a special benefit on payers (as in Burns) is treated as a tax. This does not automatically trigger the RPA.
• Class Action Bar (§ 12‑60‑80(C)):
  • Broad as to DOR (per Aiken).
  • Limited as to political subdivisions: bars only class actions concerning ad valorem property taxes; otherwise, class actions may proceed.
• Unjust Enrichment vs. Contract:
  • Contract (legal): Based on an agreement (express or implied in fact); preserved under SCTCA § 15‑78‑20(d).
  • Unjust enrichment/quasi‑contract (equitable): Implied by law to prevent unfair retention of benefits; not preserved by the SCTCA’s contract clause under the majority’s rule.
• Section 8‑21‑30 Penalties:
  • Applies to officers named in Chapter 21 who impose fees for Chapter 21 services.
  • Does not reach officers who merely collect fees set by other authorities or fees outside Chapter 21.
• Law of the Case / Two-Issue Rule:
  • If a trial court’s decision rests on multiple grounds and an appellant fails to challenge one, the unchallenged ground becomes controlling and the appellate court will affirm without reaching other issues.
• Ad valorem property tax:
  • Tax based on property value; expressly within the RPA’s property tax procedures and within § 12‑60‑80(C)’s class action bar as to political subdivisions.

Practical Guidance and Open Questions

• For plaintiffs/taxpayers:
  • Challenges to local exactions not imposed by Title 12 and not administered by DOR need not be funneled through the RPA; circuit court actions (including putative class actions) may be filed, subject to standard civil rules.
  • Consider pairing a declaratory judgment count with a well‑supported prayer for “further relief” (refunds) under § 15‑53‑120, mindful of limitations and defenses.
  • Unjust enrichment is currently foreclosed against political subdivisions; plead statutory or contract theories where available.
• For local governments:
  • Review fee structures post‑Burns for compliance with § 6‑1‑300(6)’s special‑benefit requirement.
  • Be aware that non‑property‑tax monetary exactions may be exposed to classwide litigation; robust merits defenses and Rule 23 strategies are critical.
  • Consider implications of involving DOR in assessment/collection, which may trigger broader RPA protections (and the Aiken class action bar).
• Open questions for remand and beyond:
  • Certification: Whether the putative class meets South Carolina Rule 23 requirements.
  • Remedies: Availability and scope of refund relief as “further relief” under the Declaratory Judgments Act; potential applicability of voluntary payment or other defenses.
  • Statutes of limitation and accrual issues for refund relief.
  • Future trajectory of sovereign immunity for equitable claims—the strength of Justice Hill’s dissent invites continued debate.
  • Potential legislative amendments to expand or clarify the RPA’s reach to local exactions.

Conclusion

Thompson v. Killian refines South Carolina’s public law landscape in three significant ways:

1. It narrows the RPA to its textual core—Title 12 exactions and those administered by DOR—ensuring local charges imposed under Titles 4 and 6 are not automatically constrained by RPA jurisdictional bars.
2. It reopens class action litigation against political subdivisions for non‑property‑tax disputes by limiting § 12‑60‑80(C)’s class action prohibition to ad valorem property tax matters (as to political subdivisions). This substantially changes the tactical terrain for both taxpayers and local governments.
3. It confirms, at least for now, that sovereign immunity shields the State and its political subdivisions from unjust enrichment claims, with the SCTCA’s contract savings clause preserving only true contract claims—not equitable restitution. Justice Hill’s persuasive dissent signals this point may not be settled for the long term.

The Court also underscores the importance of preservation rules and leaves for remand critical remedial questions concerning declaratory judgments and potential refunds. Ultimately, the decision embraces a careful textual approach and places the responsibility on the General Assembly to recalibrate the RPA’s scope or sovereign immunity’s reach if broader policy goals call for it.