Koolvent Aluminum Awning Co. of Pittsburgh v. City of Pittsburgh

• Decision Date: 11 June 1958
• Citation: 142 A.2d 428,186 Pa.Super. 233
• Parties: KOOLVENT ALUMINUM AWNING CO. OF PITTSBURGH v. CITY OF PITTSBURGH, Appellant, and David A. Smith, Treasurer. KOOLVENT ALUMINUM AWNING CO. OF PITTSBURGH v. SCHOOL DISTRICT OF PITTSBURGH, Appellant, and David A. Smith, Treasurer.
• Court: Pennsylvania Superior Court

142 A.2d 428

186 Pa.Super. 233

KOOLVENT ALUMINUM AWNING CO. OF PITTSBURGH v. CITY OF PITTSBURGH, Appellant, and David A. Smith, Treasurer. KOOLVENT ALUMINUM AWNING CO. OF PITTSBURGH v. SCHOOL DISTRICT OF PITTSBURGH, Appellant, and David A. Smith, Treasurer.

Superior Court of Pennsylvania.

June 11, 1958.

J. Frank McKenna, Jr., City Sol., Marcus Aaron, 2nd, Asst. City Sol., Pittsburgh, for appellant in No 1.

Mortimer B. Lesher, School Sol., Oscar G Peterson, Asst. School Solicitor, Pittsburgh, for appellant in No. 6.

Coleman Harrison, Pittsburgh, for appellee.

Before RHODES, P. J., and HIRT, GUNTHER WOODSIDE, ERVIN and WATKINS, JJ.

WOODSIDE, Judge.

This opinion is written on two appeals taken from judgments entered in mercantile tax cases by the County Court of Allegheny County in favor of Koolvent Aluminum Awning Co. of Pittsburgh and against the City of Pittsburgh in the one case, and the School District of Pittsburgh in the other case.

The Act of June 20, 1947, P.L. 745, 24 P.S. § 582.1 et seq. imposes an annual mercantile license tax upon 'dealers in, * * * goods, wares and merchandise' within the School District of Pittsburgh. See section 4 of the above act, 24 P.S. § 582.4. 'Dealer', by statutory definition does '* * * not include any mechanic who keeps a store or warehouse at his place of manufactory or workshop in which he sells only his own manufactures, any person vending or disposing of articles of his own growth, produce or manufacture, or any hawker * * *'. Section 1, supra, 24 P.S. § 582.1(4).

The Act of June 25, 1947, P.L. 1145, commonly known as the Tax Anything Act, as amended by the Act of May 9, 1949, P.L. 898, 53 P.S. § 6851 et seq., authorizes certain political subdivisions, including the City of Pittsburgh, in their discretion by ordinance for general revenue purposes to levy, assess, and collect taxes on persons, transactions, occupations, privileges, subjects and personal property except that such local subdivisions shall not have authority '(4) to levy, assess and collect a tax on goods and articles manufactured in such political subdivision or on the by-products of manufacture, or on minerals, timber, natural resources and farm products produced in such political subdivision or on the preparation or processing therof for use or market, or on any privilege, act or transaction related to the business of manufacturing, the production, preparation or processing of minerals, timber and natural resources, or farm products, by manufacturers, by producers and by farmers with respect to the goods, articles and products of their own manufacture, production or growth, or on any privilege, act or transaction relating to the business of processing by-products of manufacture, or on the transportation, loading, unloading or dumping or storage of such goods, articles, products or by-products.' (Emphasis supplied.)

Under the authority of the above act, the City of Pittsburgh passed an ordinance imposing the Koolvent Aluminum Awning Co. of Pittsburgh for the years 1952, 1953, and 1954. The school districts also assessed a tax against the said company for the same years, which it claims was imposed by the Act of June 20, 1947, P.L. 745, supra.

The company paid these taxes under protest, and then appealed the assessments to the County Court. (For jurisdiction of that court see 17 P.S. § 626(l)). That court, after consolidating the cases for hearing, entered judgments in favor of the company for the taxes paid to the city and school district, holding that the political subdivisions had no authority under the law to assess the taxes in question upon the company. The city and school district then appealed to this Court.

Although the language of the two above acts differs, it is settled that no tax is due to either the city of the school district if the articles sold by the appellee were manufactured by it. General Goods Corp. v. City of Pittsburgh, 1955, 383 Pa. 244, 251, 118 A.2d 572; Fischer v. City of Pittsburgh, 1955, 383 Pa. 138, 118 A.2d 157; Isaly Dairy Co. of Pittsburgh v. City of Pittsburgh, 1954, 379 Pa. 108, 108 A.2d 728.

There is no real dispute concerning the manner in which appellee's business is conducted. Much valuable time might have been saved to all concerned, including the court, had counsel stipulated the facts, as has been done many hundreds of times during the last half century in tax cases in the Commonwealth Court in Dauphin County.

The awnings sold by the appellee during the years in question were all custom-made. An affiliate corporation purchased aluminum sheets and strips, which it cleaned, treated for painting, painted, cut to sizes required for the making of awnings, and then stocked. When the appellee received an order for awnings it took the measurements and obtained from its affiliate the necessary parts to make the awnings.

The court below found that the appellee then proceeded as follows: The work would be performed on a 'layout work table.' The 'layout man,' having gathered together the necessary materials, would proceed to construct the various component parts of the awning. He would select appropriate pieces of aluminum, trim them if necessary, form and bend them into the starter, top and bottom pans, and louvers, and fit them together.

This forming and bending requires skill, 'has to be done with great precision', and must be done within certain tolerances in order that the parts fit into the completed awning. The angles and shapes are prescribed by certain tables which the workman follows. After all of these parts have been formed, the workman drills them at appropriate places and rivets them to another part of the awning known as a 'sawtooth section.' The workman then selects lengths of metal angle bars, cuts them to appropriate lengths, drills them, and rivets them into place in the awning as braces. As straight braces, the workman selects lengths of pipe, cuts them to size, threads them, and fastens them in place in the awning.

In making the awning, the workman has performed the following operations on sheets and bars: cutting, bending, drilling, forming, riveting, threading, trimming and fitting. All of the operations described, except painting of the coil aluminum, were performed by the appellee. * * * The awning being completed, depending on its size, either assembled or in sections, it would be placed on a truck for delivery to the place of installation.

In their jointly prepared brief the city and school district states the question to be 'Where aluminum strips or sheets, purchased as such and cut, trimmed, bent, painted and later used to form awnings, are such awnings manufactured?' Although we think it is self evident that awnings are manufactured, we have, nevertheless, thoroughly examined the question and carefully reviewed the facts and the relevant statutes and decisions.

The case before us offers no difficulties. The facts here are so clear and the conclusion so obvious that we need not be concerned with any question of burden of proof, presumption or strict construction. See, however, Fischer v. City of Pittsburgh, supra, 1955, 383 Pa. 138, 141, 142, 118 A.2d 157. The matter is disposed of by applying a principle established by the Supreme Court over a hundred years ago, and cited seventy some times since then.

'A dealer', said our Supreme Court in Norris Brothers v. Commonwealth, 1856, 27 Pa. 494, 495 'in the popular, and therefore in the statutory, sense of the word, is not one who buys to keep, or makes to sell, but one who buys to sell again.' See also Commonwealth v. Campbell, 1859, 33 Pa. 380, 385, and Commonwealth v. Lutz, 1925, 284 Pa. 184, 186, 130 A. 410.

In Re Pittsburg Brewers' & Bottlers' Supply Company's Mercantile Tax, 1909, 38 Pa.Super. 121; Commonwealth v. Lowry-Rodgers Co., 1924, 279 Pa. 361, 364, 123 A. 855, and Commonwealth v. Bay State Milling Co., 1933, 312 Pa. 28, 31, 167 A. 307, there was some deviation from the above definition, but it was subsequently repeated in Commonwealth v. Pennsylvania Heat & Power Co., 1939, 333 Pa. 46, 3 A.2d 412; Commonwealth v. McKinley-Gregg Auto Co., 1942, 345 Pa. 544, 547, 28 A.2d 919, 143 A.L.R. 582, and applied to one of the statutes before us in Paper Products Co. v. City of Pittsburgh, 1958, 391 Pa. 87, 91, 137 A.2d 253.

Although the definition of 'dealer' has a bearing upon the issue in this case, nevertheless, we are not so much concerned with it as we are with the definition of 'manufacturing.' Our Supreme Court defined that in Norris Brothers v. Commonwealth, supra, 27 Pa. 494, 496, in the following language: 'But what is manufacturing? It is making. To make in the mechanical sense does not signify to create out of nothing, for that surpasses all human power. It does not often mean the production of a new article out of materials entirely raw. It generally consists in giving new shapes, new qualities, or new combinations to matter which has already gone through some other artificial process. A cunning worker in metals is the maker of the wares he fashions, though he did not dig the ore from the earth, or carry it through every subsequent stage of refinement. A shoemaker is none the less a manufacturer of shoes because he does not also tan the leather. A bureau is made by the cabinet maker, though it consists in part of locks, knobs, and screws, bought ready made from a dealer in hardware.'

Other cases have also defined or described the word. In Rieck-McJunkin Dairy Co. v. Pittsburgh School District, 1949, 362 Pa. 13, 18, 66 A.2d 295, 297 it was said, 'The word 'manufacture' is to be taken as used by the legislature in its ordinary and general sense. * * *' A thing is a 'manufactured article' when the product is a new and different article with a distinctive...