Brunner Enterprises, Inc. v. Department of Revenue

• Decision Date: 14 June 1984
• Docket Number: No. 64553,64553
• Citation: 452 So.2d 550
• Parties: BRUNNER ENTERPRISES, INC., Appellant, v. DEPARTMENT OF REVENUE of the State of Florida, Appellee.
• Court: Florida Supreme Court

Page 550

452 So.2d 550

BRUNNER ENTERPRISES, INC., Appellant, v. DEPARTMENT OF REVENUE of the State of Florida, Appellee.

No. 64553.

Supreme Court of Florida.

June 14, 1984.

C. Gary Williams and Robert S. Hightower of Ausley, McMullen, McGehee, Carothers & Proctor, Tallahassee, for appellant.

Jim Smith, Atty. Gen., and Joseph C. Mellichamp, III, Asst. Atty. Gen., Tallahassee, and Larry Sartin, Asst. General Counsel, Dept. of Revenue, Tallahassee, for appellee.

McDONALD, Justice.

In an unpublished order the First District Court of Appeal has certified this case as requiring immediate resolution and has certified the following questions as being of great public importance:

(1) WHETHER ASARCO, INC. V. IDAHO STATE TAX COMMISSION, 458 U.S. , 102 S.Ct. 3103 (1982), 73 L.Ed.2d 787, IS APPLICABLE TO THE "FINAL JUDGMENT ON ENTRY OF MANDATE" ENTERED BY THE LOWER COURT IN THIS CASE.

(2) DID DEPARTMENT OF REVENUE V. BRUNNER ENTERPRISES, INC., 390 So.2d 713 (FLA.1980) REQUIRE THE TRIAL COURT TO DETERMINE, UNDER THE STANDARDS ENUNCIATED IN ROGER DEAN ENTERPRISES, INC. V. DEPARTMENT OF REVENUE, 387 So.2d 358 (FLA.1980), AFTER PERMITTING AN EVIDENTIARY HEARING IF DEEMED NECESSARY, WHETHER JUSTIFICATION EXISTED FOR DEVIATION FROM THE THREE-FACTOR APPORTIONMENT FORMULA.

We have jurisdiction pursuant to article V, section 3(b)(5), Florida Constitution. We answer the first question in the affirmative and find it unnecessary to address the second question.

Brunner Enterprises, Inc., is a Delaware corporation with its principal place of business in Illinois. During the fiscal years ending September 30, 1973 and September 30, 1974, Brunner owned and operated citrus groves in several Florida counties through one of its divisions. In April 1976 the Department of Revenue (DOR) assessed a tax deficiency against Brunner for failing to include investment income earned in Illinois in its Florida corporate income tax base for fiscal years 1973 and 1974. On November 9, 1976 Brunner brought suit to challenge the assessment, claiming that income earned on an out-of-state sale of stock by a foreign corporation is not taxable in Florida. The district court ultimately certified to this Court issues raised by Brunner's contention.

In Department of Revenue v. Brunner Enterprises, Inc., 390 So.2d 713 (Fla.1980), we held that the gain from an out-of-state sale of stock by a foreign corporation doing business in Florida is taxable under the Florida Corporate Income Tax Code and that the three-factor formula method ^* should be used to calculate the amount of income to be included in a foreign corporation's tax base. Based on our holding, we quashed the summary judgment that had been granted in favor of Brunner and remanded the case for further proceedings consistent with our decision. Approximately two years passed before any further litigation occurred in this case.

During the respite in proceedings, the United States Supreme Court reached a decision directly contrary to our holding in DOR v. Brunner. In ASARCO, Inc. v. Idaho State Tax Commission, 458 U.S. 307, 102 S.Ct. 3103, 73 L.Ed.2d 787 (1982), the Court held that the inclusion of out-of-state income from intangibles in a corporation's tax base and the use of Idaho's similar three-factor formula method of apportionment absent a showing of a unitary business violates the federal due process clause. Less than a week after the issuance of ASARCO, Brunner moved for a summary judgment based on that case. At that time DOR moved to strike Brunner's request for a summary judgment and filed a motion to enforce the entry of mandate. The trial judge determined that all the issues had been resolved in our decision, and, therefore, there was nothing left for him to do but to grant DOR's motion. Brunner appealed the trial court's decision to the First District Court of Appeal which certified to this Court the two issues raised by the appeal.

Simply stated, the first question that the district court has asked us to address is whether the law of the case as established by our previous decision should be changed as a result of the United States Supreme Court's decision in ASARCO. We answer this question in the affirmative, but, before we explain our reasoning, we wish to acknowledge the propriety of the circuit court judge's actions. Lower courts cannot change the law of the case as decided by this Court or, alternatively, by the highest court hearing a case. Beverly Beach Properties v. Nelson, 68 So.2d 604 (Fla.1953); Goodman v. Olsen, 365 So.2d 393 (Fla.3d DCA 1978), cert. denied, 376 So.2d 74 (Fla.1979). We are the only court that has the power to change the law of the case established by this Court. Additionally, it is a well-settled rule of law that "the judgment of an appellate court, where it issues a mandate, is a final judgment in the cause and compliance therewith by the lower court is a purely ministerial act." O.P. Corp. v. Village of North Palm Beach, 302 So.2d 130, 131 (Fla.1974). The trial judge, therefore, correctly enforced the mandate, even though it conflicted with ASARCO.

It is the general rule in Florida that all questions of law which have been decided by the highest appellate court become the law of the case which, except in extraordinary circumstances, must be followed in subsequent proceedings, both in the lower and the appellate courts. Greene v. Massey, 384 So.2d 24 (Fla.1980). Earlier in the development of the law of the...