Ala. Dep't of Revenue v. U.S. Xpress Leasing, Inc.
Decision Date | 02 December 2016 |
Docket Number | 2150547. |
Citation | 227 So.3d 48 |
Parties | ALABAMA DEPARTMENT OF REVENUE v. U.S. XPRESS LEASING, INC., et al. |
Court | Alabama Court of Civil Appeals |
Hilary Yother Parks, asst. counsel and asst. atty. gen., Alabama Department of Revenue, for appellant.
William B. Sellers and Jacob C. Harper IV of Balch & Bingham LLP, Montgomery, for appellee, U.S. Xpress Leasing, Inc.
The Alabama Department of Revenue ("the Department") appeals from a summary judgment of the Montgomery Circuit Court ("the trial court") holding that U.S. Xpress Leasing, Inc. ("USXL"), a Tennessee corporation, is subject to Alabama's lease tax under § 40–12–222(a), Ala. Code 1975, and, therefore, is exempt from being assessed Alabama's sales and use tax on certain purchases it made in Alabama from Bridgestone America, Inc., Michelin North America, Inc., TA Operating Corporation, TRD, Inc., and Four Star Freightliner, Inc. (hereinafter referred to collectively as "the joint petitioners"). See § 40–23–1(a)(9), Ala. Code 1975. The trial court's judgment reversed a decision of the Alabama Tax Tribunal ("the tax tribunal"), which had denied USXL's and the joint petitioners' petitions to the Department seeking a refund of the sales and use tax they had paid to the State of Alabama related to USXL's purchases from the joint petitioners. Under the standard of review we are required to apply in this case, we must reverse the trial court's judgment.
The following findings of fact made by the tax tribunal are not in dispute:
In 2012, USXL and the joint petitioners filed petitions with the Department pursuant to § 40–2A–7(c)(1), Ala. Code 1975, requesting a refund of the sales and use tax that USXL had paid as a result of the sales of the tires, repair parts, and other goods that USXL had purchased from the joint petitioners in Alabama between 2008 and 2011 on the basis that those purchases were exempt from the sales and use tax under § 40–23–1(a)(9). They argued that, because USXL was engaged in the business of leasing within Alabama, the transactions between USXL and the joint petitioners were subject to Alabama's lease tax under § 40–12–222(a) and, consequently, exempt from the sales and use tax. In 2013, the Department denied USXL's and the joint petitioners' petitions for a refund.
On October 13, 2014, USXL and the joint petitioners filed notices of appeal to the tax tribunal from the Department's denial of the petitions for a refund. See § 40–2A–7(c)(5) a., Ala. Code 1975 ( ). The tax tribunal entered an order on December 3, 2014, granting the Department's motion to consolidate the matters before the tax tribunal. The tax tribunal held a hearing on the matters on April 9, 2015. Following the hearing, the tax tribunal entered a written order concluding that USXL was not subject to Alabama's lease tax and, therefore, that USXL's purchases of the tires, repair parts, and other goods from the joint petitioners were subject to the sales and use tax. The tax tribunal concluded that the use of the leased property within Alabama by U.S. Express, Inc. ("U.S. Express"), did not make USXL's leasing of the vehicles to U.S. Xpress subject to Alabama's lease tax. The tax tribunal stated in its order:
Accordingly, the tax tribunal denied USXL and the joint petitioners' request for a refund of the sales and use tax that had been paid on the purchases made between 2008 and 2011.
On July 14, 2015, USXL and the joint petitioners filed a notice of appeal of the tax tribunal's decision to the trial court pursuant to § 40–2B–2(m), Ala. Code 1975. On January 15, 2016, USXL and the joint petitioners filed a motion for a summary judgment. On January 19, 2016, the Department filed a cross-motion for a summary judgment. On February 16, 2016, the trial court held a hearing on the motions for a summary judgment and heard arguments of counsel for the parties. The trial court entered a judgment in favor of USXL and the joint petitioners on February 25, 2016, stating, in pertinent part, as follows:
The trial court ultimately ordered the Department to refund the amount of sales taxes paid by USXL and the joint petitioners during the period in question. The Department filed a notice of appeal to this court on March 31, 2016. We have jurisdiction under § 12–3–10, Ala. Code 1975. The Department and USXL have filed briefs on appeal. The joint petitioners have not filed a brief.
Standard of Review
To continue reading
Request your trial