R.S. Blome Co. v. Ames
| Decision Date | 18 February 1937 |
| Docket Number | No. 23802.,23802. |
| Citation | 6 N.E.2d 841,365 Ill. 456 |
| Parties | R. S. BLOME CO. et al. v. AMES et al |
| Court | Illinois Supreme Court |
OPINION TEXT STARTS HERE
Suit by the R. S. Blome Company and others against K. L. Ames, director of finance, and others. From a decree of dismissal, the plaintiffs appeal.
Reversed and remanded.
Benjamin F. J. Odell, of Chicago, for appellants.
Otto Kerner, Atty. Gen. (Montgomery S. Winning, of Springfield, and William C. Clausen, of Chicago, of counsel), for appellees.
In the circuit court of Cook county appellants sought to enjoin appellees from requiring them to pay a tax under the provisions of ‘An Act in relation to a tax upon persons engaged in the business of selling tangible personal property to purchasers for use or consumption,’ approved June 28, 1933, effective July 1, 1933. Laws 1933, p. 924 (). They also challenge the validity of rule 6 issued by the Illinois department of finance. This rule has reference to contractors. Appellees moved to dismiss the amended complaint on the ground that appellants come within the provisions of the act and are required to pay a tax measured by their gross receipts from the transfer of tangible personal property for use or consumption and not for resale. The motion was sustained and the court rendered a decree dismissing the amended complaint for want of equity. This appeal followed.
Appellants include individuals, firms, and corporations engaged as general and subcontractors in practically all the building trades. They contract to furnish and install building materials and fixtures, to do excavating, make foundations, erect buildings, and make various kinds of repairs to buildings already built. Where the cost of materials and supplies furnished is computed separate from the labor, either in the contract or billing to the owner, the rule requires a computation of tax to be made on the gross receipts for materials. If no such separation is made either in the contract or billing, the computation is on the lump sum paid the contractor or subcontractor for work and materials.
It is the contention of appellants that they do not come within the act, and that they make no sales but render service, and the materials they furnish are only incidental to the service they render. They also insist that it was not the intent of the Legislature that building contractors and subcontractors be taxed under this act. In Brevoort Hotel Co. v. Ames, 360 Ill. 485, 196 N.E. 461, the question was whether persons engaged in the business of serving meals in restaurants or hotels conducted on the so-called European plan were persons engaged in the business of selling tangible personal property at retail in this state within the meaning of the act. In Bradley Supply Co. v. Ames, 359 Ill. 162, 194 N.E. 272, the same question was presented as to jobbers who sold to plumbing contractors engaged in the same business as that carried on by some of the appellants in the case here. In the Brevoort Hotel Co. Case, in spite of the fact that at common law innkeepers and restaurateurs were said to ‘utter’ rather than sell the food they served to guests, and we held the hotel company liable. In the Bradley Supply Co. Case we recognized that plumbing fixtures become real instead of personal property by accession, but we held that there was a transfer of title to personal property from the plumbing contractor to the owner of the real estate, and that the words ‘any transfer,’ in the first section of the act, were broader in scope than the technical term ‘sale.’ The owner was held to be the ultimate user or consumer contemplated by the act, and the jobbers who sold plumbing supplies to plumbing contractors were held to be exempt for the reason that under this act their transfers were for resale and not for...
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