Charlotte Coca-Cola Bottling Co. v. Shaw

• Decision Date: 09 June 1950
• Docket Number: No. 526,COCA-COLA,526
• Citation: 232 N.C. 307,59 S.E.2d 819
• Parties: CHARLOTTEBOTTLING CO. v. SHAW, Commissioner of Revenue.
• Court: North Carolina Supreme Court

Page 819

59 S.E.2d 819

232 N.C. 307

CHARLOTTE COCA-COLA BOTTLING CO. v. SHAW, Commissioner of Revenue.

No. 526

Supreme Court of North Carolina.

June 9, 1950

Shannonhouse & Bell and Raymond W. Bradley, Jr., Charlotte, for plaintiff-appellant.

Attorney General Harry McMullan and Assistant Attorneys General James E. Tucker and Peyton B. Abbott for defendant-appellee.

DEVIN, Justice.

From the facts agreed it appeared that plaintiff was engaged in the business of bottling and selling Coca-Cola at wholesale, and in connection therewith owned and distributed a number of machines equipped to dispense or deliver bottled Coca-Cola upon the insertion of a coin. These machines or dispensers were placed on location by plaintiff in stores and other places under agreement that plaintiff, retaining title, should install the machines and keep them supplied with bottles of Coca-Cola and ice; the merchant to pay as compensation therefor 10cents more per case of Coca-Cola than the regular price, the merchant to retain key to coin box of the machine and remove the coins at will. The compensation received by plaintiff was not more than the cost of the service, but profit was derived from increased sales of Coca-Cola. Plaintiff was free to cease to furnish merchandise or to remove the machines at any time.

In view of the business thus conducted the Commissioner of Revenue levied assessment on plaintiff for the annual occupation tax of $100 imposed by G.S. § 105-65.1 on distributors of drink dispensers, and also for an additional tax of $15 per machine on each of these vending machines placed by plaintiff with its customers. Payment was made under protest and suit instituted to recover.

The pertinent parts of the statute, G.S. § 105-65.1, under which this tax was claimed are as follows:

'(1) Every person * * * engaged in the business of operating, maintaining or placing on location anywhere within the state of North Carolina any merchandising dispenser, in which is kept any article of merchandise to be purchased, * * * shall apply for and procure * * * a state-wide license to be known as an annual distributor's or operator's license, and shall pay for such license the following tax: * * * Distributors or operators of drink dispensers $100.00.

'(2) In addition to the above annual distributor's or operator's license, every person, * * * distributing or operating any of the above dispensers * * * shall apply for and obtain * * * a statewide license for each dispenser * * *, and shall pay therefor the following annual tax: * * * Drink dispensers $15.00.

The power of the General Assembly to enact the statute quoted is not questioned by the appellant, but the view is urged upon us that the transactions engaged in by the plaintiff upon which the assessment was levied do not come within the terms of G.S. § 105-65.1, and further that the terms of the statute are so uncertain and vague as to render it unenforcible and therefore void.

It has been declared by this Court that the power to classify subjects of taxation carries with it the discretion to select them, and that a wide latitude is accorded taxing authorities, particularly in respect of occupation taxes, under the power conferred by Art. V. sec. 3, of the Constitution. Leonard v. Maxwell, 216 N.C. 89, 94, 3 S.E.2d 316; Henderson v. Gill, 229 N.C. 313, 49 S.E.2d 754; Oliver Iron Mining Co. v. Lord, 262 U.S. 172, 43 S.Ct. 526, 67 L.Ed. 929. Double taxation, as such, is not prohibited by the Constitution, and is not invalid if the rule of uniformity is observed. 51 A.J. 338. By levying an excise tax on one aspect of a business or occupation the State is not precluded from levying an additional tax on another aspect or different development of the business of the same taxpayer, if the tax applies equally to all in the same class and there is reasonable ground for the distinctive classification. Southeastern Express Co. v. City of Charlotte, 186 N.C. 668, 675, 120 S.E. 475; State v. Bridgers, 211 N.C. 235, 189 S.E. 869; Snyder v. Maxwell, 217 N.C. 617, 9 S.E.2d 19; Nesbitt v. Gill, 227 N.C. 174, 41 S.E.2d 646; Henderson v. Gill, 229 N.C. 313, 49 S.E.2d 754; Hertz Drivurself Stations v. City of Louisville, 294 Ky. 568, 172 S.W.2d 207, 147 A.L.R. 306. Thus, the same person may be required to pay an occupation license tax as a merchant, and also an additional tax for selling cigarettes, and another tax on each coin operated vending machine, and different rates on different machines according to the class of merchandise dispensed. Snyder v. Maxwell, supra.

Here, the plaintiff is engaged in the business of bottling and selling Coca-Cola at wholesale, and in connection therewith owns and distributes as part of its business a large number of machines for dispensing bottles of Coca-Cola, and places them on location with merchants and others under agreement. It is...