KSD/KSD-TV, Inc. v. Labor and Indus. Relations Commission, KSD-T

• Decision Date: 13 March 1978
• Docket Number: KSD-T,INC,No. 60342,60342
• Citation: 562 S.W.2d 346
• Parties: KSD/, a corporation, and the Pulitzer Publishing Company, a corporation, Respondents, v. LABOR AND INDUSTRIAL RELATIONS COMMISSION of Missouri et al., Appellants.
• Court: Missouri Supreme Court

Page 346

562 S.W.2d 346

KSD/KSD-TV, INC., a corporation, and the Pulitzer Publishing

Company, a corporation, Respondents, v. LABOR AND INDUSTRIAL RELATIONS COMMISSION of Missouri et

al., Appellants.

No. 60342.

Supreme Court of Missouri, En Banc.

March 13, 1978.

Rick V. Morris, Terry C. Allen, Dan J. Chatfield, Div. of Employment Security, Jefferson City, Charles B. Fain, Jefferson City, for appellants.

Robert B. Hoemeke, Evans, Hoemeke & Casey, St. Louis, for respondents.

DONNELLY, Judge.

This case involves a construction of § 288.110, RSMo 1969, a portion of the Missouri Employment Security Law. Section 288.110 reads, in pertinent part, as follows:

"Any individual, type of organization or employing unit which has acquired substantially all of the business of an employer, excepting in any such case any assets retained by such employer incident to the liquidation of his obligations, and in respect to which the division finds that immediately after such change such business of the predecessor employer is continued without interruption solely by the successor, shall stand in the position of such predecessor employer in all respects, including the predecessor's separate account, actual contribution and benefit experience, annual payrolls, and liability for current or delinquent contributions, interest and penalties. If two or more individuals, organizations, or employing units acquired at approximately the same time substantially all of the business of an employer (excepting in any such case any assets retained by such employer incident to the liquidation of his obligations) and in respect to which the division finds that immediately after such change all portions of such business of the predecessor are continued without interruption solely by such successors, each such individual, organization, or employing unit shall stand in the position of such predecessor with respect to the proportionate share of the predecessor's separate account, actual contribution and benefit experience and annual payroll as determined by the portion of the predecessor's taxable payroll applicable to the portion of the business acquired, and each such individual, organization or employing unit shall be liable for current or delinquent contributions, interest and penalties of the predecessor in the same relative proportion. * * *."

Prior to December 30, 1973, Pulitzer Publishing Company had approximately 2,000 employees engaged in the business of publishing its newspaper, the St. Louis Post-Dispatch, and approximately 200 employees engaged in the business of operating its radio and television facilities, KSD and KSD-TV. On December 30, 1973, KSD/KSD-TV, Inc. was incorporated as a wholly owned subsidiary of Pulitzer and acquired its broadcasting facilities and employees.

Prior to December 30, 1973, Pulitzer's unemployment contribution tax rate under the Missouri Employment Security Law was 1.4%. After December 30, 1973, the Division of Employment Security continued Pulitzer's rate at 1.4% But increased KSD/KSD-TV's rate to 2.7%.

KSD/KSD-TV contended it should be given a rate of 1.4%. It relied upon the second sentence of § 288.110, supra, and asserted:

"We are familiar with Section 288.110 and particularly that provision that to succeed to a rate a company must have 'acquired substantially all of the business of an employer.' However, we believe this language must be read in conjunction with the additional proviso in the statute that if two or more employers succeed to the business of an employer, then they can succeed to such employer's account.

"In our situation nothing has changed but the form. There is no doubt but that if two new companies had acquired respectively the newspaper and broadcasting business of Pulitzer they could succeed to the Pulitzer rate. It seems an absurd statutory construction to hold that while that can occur, when a company transfers a severable portion of its business to a wholly owned...