Arbor Sales, Inc. v. Department of Treasury, Docket No. 47997
Decision Date | 03 March 1981 |
Docket Number | Docket No. 47997 |
Citation | 104 Mich.App. 181,304 N.W.2d 522 |
Parties | ARBOR SALES, INCORPORATED, Plaintiff-Appellee, v. The DEPARTMENT OF TREASURY, Defendant-Appellant. |
Court | Court of Appeal of Michigan — District of US |
Frank J. Kelley, Atty. Gen., Robert A. Derengoski, Sol. Gen., Curtis G. Beck, Asst. Atty. Gen., for defendant-appellant.
Bernard L. McAra, Flint, for plaintiff-appellee.
Before CAVANAGH, P. J., and T. M. BURNS and CAMPBELL, * JJ.
Defendant, Department of Treasury, appeals as of right an August 16, 1979, order of the Court of Claims granting judgment in favor of plaintiff on its claim that the defendant unlawfully levied taxes on plaintiff. We affirm.
Plaintiff is in the business of selling small items and goods such as trash bags and bicycle flags to volunteer and fraternal organizations. Plaintiff does not manufacture these items but receives orders from its customers and arranges for the shipment of the goods from their manufacturers to its customers. Upon delivery of the goods, plaintiff is paid by its customers and in turn pays the manufacturers. Plaintiff's customers then resell the items to local merchants and other individuals.
From 1969 to 1972, neither plaintiff nor any of its customers possessed a state sales tax license despite the fact that none of them qualified as a tax exempt institution. The parties stipulated, and the lower court specifically found, that plaintiff was unaware that its customers did not possess the required sales tax licenses.
Plaintiff paid no sales tax on its gross receipts during the period of 1969 to 1972. After an audit, the defendant Department of Treasury determined that plaintiff owed sales taxes on its gross receipts in the amount of $12,540.99 for these four years. Plaintiff contested defendant's tax assessment but in an order dated July 15, 1977, the State Board of Tax Appeals upheld its validity.
Subsequently, plaintiff paid the amount of assessed sales taxes, plus interest and penalties, and then instituted the present action in the Michigan Court of Claims seeking a refund of the payment. In an order dated July 3, 1979, the Court of Claims reversed the decision of the State Board of Tax Appeals and directed defendant to pay a refund to plaintiff. Specifically, the lower court found that "Plaintiff did not make a sale other than for resale and did not knowingly make a sale to individuals or organizations without sales tax licenses". Defendant now appeals and we affirm.
Pursuant to the provisions of Section 2 of the General Sales Tax Act, M.C.L. § 205.52; M.S.A. § 7.522, all persons who are "engaged in the business of making sales at retail" must pay an annual sales tax for the privilege of engaging in such business equal to 4% of the gross proceeds of the business. Plaintiff is not liable for the tax under this section of the act because plaintiff does not make "sales at retail" as that term is defined in the appropriate section of the act:
" 'Sale at retail' means a transaction by which is transferred for consideration the ownership of tangible personal property, when the transfer is made in the ordinary course of the transferor's business and is made to the transferee for consumption or use, or for any other purpose than for resale * * *." M.C.L. § 205.51(b); M.S.A. § 7.521(b).
The ordinary course of plaintiff's business is to transfer goods for resale and not for consumption or use.
Defendant, however, argues that plaintiff is liable for the sales taxes under another section of the act, M.C.L. § 205.67; M.S.A. § 7.538. This section, § 17 of the General Sales Tax Act, provides:
Defendant contends that plaintiff is liable for the taxes because it failed to keep proper records. Plaintiff responds that this section of the act applies only to persons defined in M.C.L. § 205.52; M.S.A. § 7.522, as "persons engaged in the business of making sales at retail".
Standing alone, the first sentence of § 17 of the act would not make plaintiff liable for the sales tax for failure to keep accurate and complete records because that part of § 17 pertains only to persons "liable for any tax imposed under this act." Plaintiff is not liable for the sales tax under § 2 of the act and it therefore follows that plaintiff cannot be found liable for the tax merely because it failed to keep accurate and complete records. However, also standing alone, the second sentence of § 17 would appear to make plaintiff liable for the tax. Thus, the question before us is one of legislative intent. Did the Legislature intend to limit the scope of the second sentence of § 17 to that class of persons referred to in the first sentence of this section and defined in § 2 of the act?
The cardinal consideration when construing statutes is to give effect to the intention to the Legislature. In re Petition of State Highway Comm., 383 Mich. 709, 178 N.W.2d 923 (1970). Seeming inconsistencies in different provisions of a statute should be reconciled if possible so as to arrive at a meaning that gives appropriate effect to all parts of the...
To continue reading
Request your trial-
People v. Stinson, Docket No. 51184
...if possible so as to arrive at a meaning that gives appropriate effect to all parts of the statute. Arbor Sales, Inc. v. Dept. of Treasury, 104 Mich. 181, 185, 304 N.W.2d 522 (1981). In explaining the legislative intent behind the enactment of the rebuttal-of-alibi notice requirement, this ......
-
Holy Spirit Ass'n for Unification of World Christianity v. Department of Treasury
...tax liability, a matter dependent upon proofs apart from those pertinent to the assessment amount. See Arbor Sales, Inc. v. Dep't. of Treasury, 104 Mich.App. 181, 304 N.W.2d 522 (1981), noting that a person or organization may not be found liable for a tax merely because it fails to keep ac......
-
Borkus v. Michigan Nat. Bank
...if possible so as to arrive at a meaning that gives appropriate effect to all parts of the statute. Arbor Sales, Inc. v. Dep't of Treasury, 104 Mich.App. 181, 185, 304 N.W.2d 522 (1981). The statute relied upon by defendant does not prohibit a bank customer or mortgagor from bringing an act......
-
Port Huron & Detroit R. Co. v. Revenue Com'r in Revenue Division, Dept. of Treasury
...to the Legislature's intent. City of Lansing v. Twp. of Lansing, 356 Mich. 641, 97 N.W.2d 804 (1959); Arbor Sales, Inc. v. Dep't of Treasury, 104 Mich.App. 181, 304 N.W.2d 522 (1981). See also Production Credit Ass'n of Lansing v. Dep't of Treasury, 404 Mich. 301, 312, 273 N.W.2d 10 (1978),......