City of Mobile v. McCown Oil Co.

• Decision Date: 25 May 1933
• Docket Number: 1 Div. 760.
• Citation: 148 So. 402,226 Ala. 688
• Parties: CITY OF MOBILE v. McCOWN OIL CO.
• Court: Alabama Supreme Court

148 So. 402

226 Ala. 688

CITY OF MOBILE v. McCOWN OIL CO.

1 Div. 760.

Supreme Court of Alabama

May 25, 1933

Appeal from Circuit Court, Mobile County; Claude A. Grayson, Judge.

Bill for accounting by the City of Mobile against the McCown Oil Company. From a decree sustaining a demurrer to the bill complainant appeals.

Reversed rendered, and remanded.

Armbrecht Hand & Twitty, of Mobile, for appellant.

Lyons, Chamberlain & Courtney, of Mobile, for appellee.

KNIGHT Justice.

Bill by the city of Mobile against the McCown Oil Company. The purpose of the bill was to secure an accounting and discovery as to the amount of money due by the respondent to the city under certain city ordinances, imposing license taxes for the privilege of engaging in the business of selling gasoline at wholesale and retail in the city of Mobile, and within its police jurisdiction. The bill also prays for injunction against further sales by respondent until it has paid the city all amounts due for license taxes, and to fasten a lien upon the real and personal property of the respondent used in its said business to satisfy any judgment or decree that might be rendered in the cause, for and on account of such license taxes.

The bill avers that the city had duly adopted ordinances levying or imposing certain license taxes for the privilege of engaging in the business of selling gasoline at wholesale and retail in the city of Mobile and within its police jurisdiction, and that these ordinances were in force and effect during the period of time it contends that the respondent was in default in the payment of privilege taxes due the city. For the privilege of "doing business or trading within the corporate limits of the city of Mobile as and/or within said limits carrying on the business or trade of jobbers of gasoline and/or any substitute therefor and/or of naphtha and/or other motor fuels commonly used in internal combustion engines" the license is fixed at a sum equal to 1 1/2 per cent. of the gross jobbing sales of such gasoline and substitutes therefor, provided, however, that the minimum license required to be paid by any such jobber shall be and is fixed at $500. The term "gross jobbing sales," as used in the ordinance, is defined to mean "sales made by such person, firm, association or corporation as a middleman or jobber."

For such sales made without the corporate limits of the city, but within its police jurisdiction, a license tax equal to three-fourths of 1 per cent. of the gross jobbers' sales of such gasoline and substitute is imposed, with minimum license tax of $250.

By another ordinance, a monthly license tax upon retailers of gasoline and substitutes therefor, within the corporate limits of the city of Mobile is levied. The amount of this tax is fixed "in a sum equal to one cent per gallon for each and every gallon of gasoline sold in the city of Mobile during the preceding month by such person to a consumer or consumers of gasoline."

By still another ordinance, a monthly license tax is levied upon retailers of gasoline and substitutes therefor, without the corporate limits of the city, but within its police jurisdiction. The license tax fixed in such cases being fixed in a sum of one-half of 1 per cent per gallon for each gallon sold.

The bill also avers that the respondent has during the years 1928, 1929, 1930, and 1931 engaged in the several businesses covered by said ordinances, and for which the several and respective license taxes were imposed, and required to be paid, and that the respondent has not paid in full the licenses referred to in said ordinances, either as jobbers or as retailers, and that respondent owes to the complainant a large sum of money for engaging in said business described in said ordinances.

Complainant further avers that its duly authorized agents have made repeated efforts to examine the books of respondent in order to determine the exact amount of money due from the respondent to the complainant for the licenses referred to, but that the respondent has refused to furnish said books to said agents and has refused to allow the said agents to have access thereto, and has refused on demand to pay the said licenses.

The prayer of the bill appears in the report of the case.

It is noted that the averments as to doing business within and without the city, but within the police jurisdiction thereof, and as to the respondent's being indebted to the complainant for and on account of such license taxes, and also as to the refusal of the respondent to permit an inspection of its business by the agents of the city are made upon information and belief.

The respondent filed a number of grounds of demurrer to the bill, all, however, are directed to the bill as a whole.

Upon submission upon the demurrer, the court sustained the demurrers, and from that interlocutory decree the appeal is prosecuted by the city of Mobile.

While the bill is one for an accounting, yet it also seeks discovery, and its equity must be determined by those rules which govern in cases where discovery, as well as an accounting, is sought.

In the case of Beggs v. Edison Electric Illuminating Co., 96 Ala. 297, 11 So. 381, 382, 38 Am. St. Rep. 94, Chief Justice Stone, in writing for the court, observed: "Courts of equity have, for a long time, exercised a general jurisdiction in cases of mutual accounts founded in privity upon the ground of the inadequacy of the remedy afforded by the common law; and this equitable interposition has been extended until equity will now entertain suits for accounts in matters which were formerly only cognizable at law. The ancient common-law action of account being so imperfect in its processes, and so inadequate in its remedies, jurisdiction in such matters was originally given to equity, for the reason that the common-law courts could not give any remedy at all, or the remedy was not as complete as that furnished by the chancery court. As courts of equity now entertain concurrent jurisdiction with the courts of law, in matters of accounts, a decision as to the proper tribunal must be governed by considerations of convenience and adequacy; and this is determined by the facts pertaining to each individual cause of action and the relief sought. * * *

"It is now the settled doctrine of equity jurisprudence that, when the accounts to be examined are on one side only, great complication ought to exist in the accounts or a discovery should be required in order to induce a court of chancery to exercise jurisdiction." (Italics supplied.)

In the case of Compton et al. v. Gilder, 176 Ala. 309, 58 So. 271, this court held that where the bill sets up facts which render an accounting at law complicated if not impossible, and where complainant seeks a discovery, it presented a proper case for the exercise of chancery jurisdiction.

In the case of Comer v. Birmingham News Co., 218 Ala. 360, 118 So. 806, 807, this court, while observing that a bill in equity for an accounting, where the account to be examined is on one side only, and no necessity for a discovery is shown, and no discovery is prayed for, cannot be maintained unless there is so great complication in matter of accounts as to render remedies at law inadequate. Nevertheless, in that case it held: "We think the bill shows such a complicated state of affairs in the account as to render it necessary and proper that it should be stated by a trained master, register, or accountant, rather than a common-law jury; that it can be more expediently and satisfactorily adjusted by a court of equity; and that, while the remedy at law may exist, it is not adequate or practical."

The rule of our decisions on the subject of accounting is thus stated in our recent case of Ingram et al. v People's Finance & Thrift Co. of Ala., 146 So. 822, 823: "A bill for accounting states a case of equitable relief on facts showing a complicated nature of the account, or necessity for discovery of matters peculiarly within the knowledge of respondent, or fiduciary or trust relationship, or species of fraud or such wrong dealing as would authorize a court of equity to take cognizance thereof." Julian v. Woolbert, 202 Ala. 530, 81 So. 32; ...