Sanitary Milk & Ice Cream Co. v. Hickman

• Decision Date: 02 November 1937
• Docket Number: 8631.
• Parties: SANITARY MILK & ICE CREAM CO. v. HICKMAN et al.
• Court: West Virginia Supreme Court

193 S.E. 553

119 W.Va. 351

SANITARY MILK & ICE CREAM CO. v. HICKMAN et al.

No. 8631.

Supreme Court of Appeals of West Virginia.

November 2, 1937

Submitted September 21,1937.

Syllabus by the Court.

1. Code, chapter 14, article 2, section 4, provides that suits against the governor, attorney general, treasurer, auditor board of public works or other public corporation composed of officers of government having custody of funds or property of which the state is sole owner, shall be brought and prosecuted in the circuit court of the county in which the seat of government is located. The terms of the statute are not broad enough to include the tax commissioner. A suit against that official may be brought in any county wherein there is jurisdiction and venue.

2. A corporation chartered under the cooperative associations statute, Code, chapter 19, article 4, and engaged in manufacturing, processing and selling dairy products produced by its stockholders and others, is not entitled to exemption from the gross sales tax imposed by Code, 11-13-2(c), as amended by Acts 1935, c. 86, on sales of property. The exemption accorded by said section to persons engaged in the business of agriculture does not carry through to a processing enterprise. Code, 19-4-20 extends such exemption to an association which markets natural products of its members, but not to an association engaged in manufacturing and processing commodities from farm products.

Appeal from Circuit Court, Monongalia County.

Suit by the Sanitary Milk & Ice Cream Company against Pearl T Hickman, Sheriff, Fred L. Fox. Tax Commissioner, and others. Decree for plaintiff, and Fred L. Fox, Tax Commissioner, and others, appeal.

Reversed.

Clarence W. Meadows, Atty. Gen., Ira J. Partlow, Asst. Atty. Gen., and J. V. Sanders, Pros. Atty., of Morgantown, for appellants.

George R. Farmer, of Morgantown, for appellee.

MAXWELL Judge.

This is an appeal from a decree of the circuit court of Monongalia County enjoining the sheriff of that county and the state tax commissioner from enforcing against the plaintiff an assessment for gross sales tax on the plaintiff's business for the calendar year of 1935.

The plaintiff, claiming exemption from such tax, declined to make a report of its gross sales for the year stated. The tax commissioner, believing that the plaintiff was not exempt from the tax, laid an assessment of $816.50 against the plaintiff, based on such information as was available to the commissioner, and forwarded the assessment to the sheriff of Monongalia County with instructions to make collection. In pursuance of such authorization, the sheriff levied on certain personal property belonging to the plaintiff. Further proceedings by the officials were inhibited by the decree aforesaid.

The tax commissioner challenges the right of the plaintiff to prosecute the suit in Monongalia County, the insistence being that, inasmuch as the suit is against a state official, it can be prosecuted only in the county wherein is located the seat of government of the state. This contention is based on Code 14-2-4, which provides that suits against the governor attorney general, treasurer, auditor, board of public works or other public corporation, composed of officers of government, having custody of funds or property of which the state is sole owner, shall be brought and prosecuted in the circuit court of the county in which the seat of government is located. This statute was discussed in the case of Davis v. West Virginia Bridge Commission, 113 W.Va 110, 166 S.E. 819. A majority of the court was of opinion that the statute applied to the Bridge Commission because it was a governmental corporation controlling state property and funds. We do not think, however, that the terms of the statute are broad enough to include the state tax commissioner. He is not one of the officials specifically named in the statute, nor is the general language thereof broad enough to include him. We therefore reach the conclusion that the contention that this suit may not be prosecuted in a county other than that in which the seat of government is located is not well taken.

The state imposes a privilege tax, generally referred to as a gross sales tax, upon "every person engaging or continuing within this state in the business of selling any tangible property whatsoever, real or personal, except sales by any person engaging or continuing in the business of horticulture, agriculture or grazing, or of selling stocks, bonds or other evidences of indebtedness." Code, 11-13-2(c), as amended by Acts 1935, c. 86. There is a further provision of the act that the tax shall not be applicable to "societies, organizations and associations organized and operated for the exclusive benefit of their members and not for profit." Code, 11-13-3, as enacted by Acts 1933, 1st Ex.Sess., c. 33.

The pointed inquiry on this appeal is whether the plaintiff comes within either of the quoted exceptions.

The plaintiff is a co-operative association organized under the...