J. A. Tobin Const. Co. v. Weed

Decision Date08 November 1965
Docket NumberNo. 21189,21189
PartiesJ. A. TOBIN CONSTRUCTION CO., a Missouri corporation, Plaintiff in Error, v. Hugh H. C. WEED, Jr., as Director of Revenue of the State of Colorado, and the Department of Revenue of the State of Colorado, Defendants in Error.
CourtColorado Supreme Court

Drexler & Wald, Denver, for plaintiff in error.

Duke W. Dunbar, Atty. Gen., Frank E. Hickey, Deputy Atty. Gen., Richard L. Eason, Asst. Atty. Gen., John H. Heckers, Sp. Asst. Atty. Gen., John E. Bush, Asst. Atty. Gen., Denver, for defendants in error.

MOORE, Justice.

In this action the J. A. Tobin Construction Co., a Missouri corporation hereinafter referred to as Tobin, seeks review of a judgment entered by the district court which sustained the action of the director of revenue in issuing a Use Tax Deficiency Assessment and demand for payment of use tax in the amount of $4,161.23 plus penalty and interest.

C.R.S.1953, 138-6-26(2) provides, inter alia, that:

'The district court of the county wherein the taxpayer resides or has his principal place of business shall have original jurisdiction in proceedings to review all questions of law and fact determined by the director of revenue in administering the provisions of sections 138-6-1 to 138-6-32 by writ of certiorari to the director of revenue. * * *'

In his complaint Tobin, seeking relief by certiorari, points up the pertinent issues by the following allegations:

'11. That the entire assessment, penalty and interest, should be eliminated for the reason that the transaction involved is not subject to the Colorado Use Tax but is covered by the Colorado Sales Tax statute and that such sales tax, if any is due, should be collected from the seller, Hinman Bros. Construction Co.

'12. In support of the foregoing the following Colorado statutes are applicable. Colorado Revised Statutes 1953, Section 138-6-34(1) provides that the Colorado Use Tax shall not apply: 'To the storage, use of consumption of any tangible personal property the sale of which is subject to the Retail Sales Tax imposed by said Emergency Retail Sales Tax Law of 1935 and any amendments thereto.' Colorado Revised Statutes 1953, Section 138-6-4(1) imposes a sales tax on sales 'at retail.' Section 138-6-2(7) defines 'retail sales' as all sales except wholesale sales. Section 138-6-2(5) defines wholesale sale to mean 'a sale by wholesalers to retail merchants, jobbers, dealers or other wholesalers for resale and does not include a sale by wholesalers to users or consumers, not for resale; and the latter sales shall be deemed retail sales, and subject to the provisions of this article.''

Tobin at all times pertinent to this action was a construction contractor. It purchased for use in its operation, and not for resale, automotive equipment and parts for which it paid the sum of $218,061.70. The seller of this equipment was the Hinman Bros. Construction Co., a Colorado corporation. Neither Hinman Bros. nor Tobin was in business of selling equipment at either wholesale or retail. Their business activities were similar and consisted of construction work and the negotiation of contracts connection therewith. The transaction here involved was an isolated one in which Tobin purchased equipment owned by Hinman Bros. for which the seller Hinman had no immediate need.

After the hearing before him the director of revenue entered the 'Final Determination' the pertinent language of which is as follows:

'Following the sale as outlined, Tobin filed the necessary forms and paid tax to the county clerks of Adams and Grand Counties, Colorado, on automotive equipment purchased for Hinman having a value of $10,000. No tax has been paid by either Hinman or Tobin on the remainder of the purchases totaling $208,061.70. * * *

* * *

* * *

'Taxpayer contends that the transaction upon which the assessment was made is subject to the sales tax, and as a consequence is not subject to the assessment for use tax, although no sales tax had been paid on the property purchased. Taxpayer relied upon the provisions of 138-6-34(1) C.R.S.1953, which provides that the use tax shall not apply:

'To the storage, use or consumption of any tangible personal property the sale of which is subject to the retail sales tax imposed by said emergency retail sales tax law of 1935 and any amendments thereto.'

Taxpayer further contends that Hinman may be liable for sales tax on the transaction but that Tobin, the ultimate consumer at retail, is not liable for use tax notwithstanding the fact that no sales tax was paid by Tobin to Hinman on the amount involved in the purchase.

'The issue presented for determination is whether or not a purchaser of tangible personal property purchased at retail in an isolated transaction upon which no sales tax has been paid, can be held liable for the payment of use tax.'

As hereinabove indicated, the...

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27 cases
  • Colorado Dept. of Social Services v. Board of County Com'rs of Pueblo County
    • United States
    • Colorado Supreme Court
    • 11 Marzo 1985
    ...is to be construed as a whole to give "consistent, harmonious and sensible effect to all its parts." J.A. Tobin Construction Co. v. Weed, 158 Colo. 430, 435, 407 P.2d 350, 353 (1965). In light of the clear mandate in subsections (1) through (3), we agree with the trial court that subsection......
  • Direct Mktg. Ass'n v. Brohl
    • United States
    • U.S. Court of Appeals — Tenth Circuit
    • 20 Agosto 2013
    ...and remit sales tax to the Department, the onus is on the purchaser to report and pay use tax. See J.A. Tobin Const. Co. v. Weed, 158 Colo. 430, 407 P.2d 350, 353 (1965) (en banc). This difference results from the Supreme Court's bright-line rule in Quill Corp. v. North Dakota, 504 U.S. 298......
  • Direct Mktg. Ass'n v. Brohl
    • United States
    • U.S. Court of Appeals — Tenth Circuit
    • 20 Agosto 2013
    ...collect and remit sales tax to the Department, the onus is on the purchaser to report and pay use tax. See J.A. Tobin Const. Co. v. Weed, 407 P.2d 350, 353 (Colo. 1965) (en banc). This difference results from the Supreme Court's bright-line rule in Quill Corp. v. North Dakota, 504 U.S. 298 ......
  • Walgreen Co. v. Charnes
    • United States
    • Colorado Supreme Court
    • 28 Octubre 1991
    ...Howard Elec. and Mechanical, Inc. v. Department of Revenue of Colorado, 771 P.2d 475, 477 (Colo.1989) (quoting J.A. Tobin Constr. Co. v. Weed, 158 Colo. 430, 407 P.2d 350 (1965)). We have held that use taxes are not separate from, but are complementary to, sales taxes. Howard Elec., 771 P.2......
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