American Oil Co. v. Neill
| Decision Date | 20 June 1963 |
| Docket Number | No. 9113,9113 |
| Parties | The AMERICAN OIL COMPANY, a Maryland corporation, Plaintiff-Respondent, and Cross-Appellant, v. P. G. NEILL, former Tax Collector of the State of Idaho, and Floyd West, Acting Tax Collector of the State of Idaho, Defendants-Appellants and Cross- Respondents. |
| Court | Idaho Supreme Court |
Frank L. Benson, Atty. Gen., William M. Smith, Asst. Atty. Gen., Boise, for appellant.
Calvin Dworshak, Jay L. Webb, Boise, for respondents.
This action, originally brought by Utah Oil Refining Company, is to recover motor fuels tax payments made under protest to P. G. Neill, State Tax Collector. The payments were made during the period between January and November, 1960, for motor fuels delivered between November 1, 1959 and October 30, 1960. Subsequent to instituting the action The American Oil Company, as successor of Utah Oil Refining Company, was substituted as the plaintiff; P. G. Neill resigned as Tax Collector of the State of Idaho, and Vernon Drown was appointed as acting Tax Collector of the State; Mr. Drown died in office, and Floyd West, was later appointed as the Tax Collector of the State, and named herein as party defendant.
Defendant moved to dismiss the plaintiff's complaint; plaintiff moved for summary judgment, and defendant moved to dismiss the plaintiff's motion for summary judgment. The summary judgment was entered for the plaintiff in the principal amount prayed for, but without interest. The judgment provided, inter alia:
'That the Defendants, P. G. Neill, former Tax Collector of the State of Idaho, and Vernon E. Drown, Acting Tax Collector of the State of Idaho, and each of them, are hereby directed to refund and pay, or cause to be paid, to the Plaintiff, the American Oil Company, a corporation, the sum of $86,181.30 hereby found to have been illegally and erroneously demanded and collected from the Utah Oil Refining Company, a corporation, predecessor in interest to the Plaintiff herein, as motor fuels taxes upon the transaction set forth in the complaint and supplemental complaints on file herein, PROVIDED HOWEVER, That this judgment shall not be satisfied out of the individual property of said Defendants or either of them.'
Defendants appealed from the summary judgment and plaintiff cross appealed from that portion of the summary judgment refusing plaintiff any interest, from the portion thereof holding the defendants not personally liable, and denying plaintiff its costs;
The defendants' assignments are as follows:
Defendant summarize their position on this appeal by recital of the following two issues:
.
In order to understand the position of the respective parties concerning these assignments of error, a rather detailed statement of the facts leading to this litigation is essential.
The Federal Government, acting through the Atomic Energy Commission (referred to as the A. E. C.) operates facilities at Idaho Falls, and at the National Reactor Testing Station northwest from Idaho Falls.
The Phillips Petroleum Company is a contractor with the A. E. C. and on its behalf actually performs certain required services, including the operation of busses between Idaho Falls, and the National Reactor Testing Station. The gasoline, the basis of the controverted tax, was consumed in motor vehicles owned by the Federal Government, and used in transporting personnel connected with the A. E. C. A fee was charged for the transportation of persons using the Government busses, which fee accrued to the use and benefit of the Government. Losses involved in operating the busses were fully absorbed by the Government.
The Federal Government by the General Service Administration, a Federal agency, (sometimes referred to as G. S. A.) issued invitation for bids for supplying gasoline for activities in Idaho, Montana, Oregon and Washington, for the period from November 1, 1959 through October 31, 1960. Included in this invitation (along with other items) were items Nos. 63 and 64 covering the needs for gasoline for the A. E. C., at Idaho Falls, and at the National Reactor Testing Station. Utah Oil Refining Company, submitted its formal bid on these items (with other bid items) to the General Service Administration office at Seattle, Washington.
On September 15, 1959, the G. S. A. accepted Utah Oil Refining Company's bid for listed items Nos. 63 and 64. In the bid as submitted, the bidder stated that the Idaho State tax of $.06 per gallon was included in the bid. Both items Nos. 63 and 64 were submitted in alternative forms.
Item No. 63 was for 200,000 gallons of gasoline for Idaho Falls, with tank truck delivery quoted. The first alternative bid was as follows:
'(a) f. o. b. bulk plant posted price date of bid $.1905 Location of bulk plant Salt Lake City.'
Under this alternate bid maximum price per gallon, after deductions was $.1580 per gallon 'Ex. State Tax.' The other alternate was as follows:
'(b) f. o. b. activity, transport truck delivered price date of bid: $.2755.'
Under this alternate bid, the maximum price per gallon, after deductions was $.2418 per gallon.
Item No. 64 was for 1,000,000 gallons of gasoline for the National Reactor site with identical alternates, except for prices quoted.
The A. E. C. through its operating agent periodically placed orders under the contract for delivery of the gasoline at the bulk plant at Salt Lake City. Common carriers selected and paid by the A. E. C. transported the gasoline from Utah to government owned storage tanks in Idaho. Monthly thereafter Utah Oil Refining Company, submitted the reports required by I.C. § 49-1210, and paid under protest to the State Tax Collector the $.06 per gallon Motor Fuels Tax. Utah Oil Refining Company, a Delaware Corporation, authorized to do business in Idaho, was a licensed dealer as defined by the provisions of that chapter. The A. E. C. is not a licensed dealer. The status of Phillips Petroleum Company, as a licensed dealer, is immaterial to this decision, for its status is only that of a contractor of the A. E. C., at the Idaho Falls and National Reactor Testing station.
In 1933 the Legislature of Idaho enacted an excise tax on motor fuels, which act later amended in subsequent legislative sessions is not contained in Chapter 12, Title 49, Idaho Code, with the 'Special Fuel Use Tax Act' (S.L.1953, Ch. 262). The 1933 act, as amended, fixes an excise tax on motor fuels. A 'dealer' in motor fuels is defined as any person, (which includes individuals, firms, corporations, etc.), who first receives motor fuels in this state, as the term 'received' is there defined.
All dealers are required to hold a permit by the State Tax Collector, issued upon application and posting of bond conditioned on compliance with the law. Such permit is required before any person can import, receive, use, sell or distribute motor fuels; non-compliance with the law subjects any persons to criminal penalties and civil liabilities.
Each dealer is required to report monthly the gallonage of all motor fuels received for the preceding month, and to pay the $.06 per gallon tax. Provisions are made for deductions from the gallonage reported for fuels exported, fuels sold or used in aircraft (which fuels bear a different tax), and fuels used in a non-highway activities, plus a 2% shrinkage allowance. The proceeds of the tax are paid by the Tax Collector to the State Treasurer for deposit in the dedicated highway funds of the state, including a special fund to be used for payment of lawful refunds of the tax. Excepting for the fuels contained in the fuel tank of a vehicle, the act requires payment of the tax by the vehicle owner on all fuels imparted into the state by motor vehicles, in the event of failure of the 'dealer', or 'individual' for whom the importation is made, to pay the tax.
By amendments to the 1933 act the excise tax becomes due when the motor fuel is 'received' by a licensed dealer. The 1959 amendment (S.L.1959, Ch. 75), here involved, provides:
'I.C. § 49-1201--Definitions. * * *
* * *
* * *
'(g) * * * Motor Fuel, for the purpose of determining liability for the payment of the tax imposed by section 49-1210, shall be considered to be 'received' in the following cases:
'1. * * *.
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