Shea v. State Tax Commission

• Decision Date: 29 December 1941
• Docket Number: 6351
• Citation: 101 Utah 209,120 P.2d 274
• Court: Utah Supreme Court
• Parties: SHEA et al. v. STATE TAX COMMISSION et al

120 P.2d 274

101 Utah 209

SHEA et al. v. STATE TAX COMMISSION et al

No.6351

Supreme Court of Utah

December 29, 1941

Appeal from District Court, Third District, Salt Lake County; Lester A. Wade, Judge.

Mandamus proceedings by Charles A. Shea and another, a partnership doing business under the firm name and style of Conyes Freight Lines, against the State Tax Commission of the State of Utah, Irwin Arnovitz, Chairman, H. P. Leatham and others the individual members of the State Tax Commission, to compel defendants to allow and approve claims for refund of Diesel fuel taxes or fees paid by plaintiffs. From an adverse judgment, plaintiffs appeal.

Affirmed.

Louis H. Callister, Ned Warnock, and E. R. Callister, Jr., all of Salt Lake City, for appellants.

Alvin I. Smith and Garfield O. Anderson, both of Salt Lake City for respondents.

LARSON, Justice. WOLFE and McDONOUGH, JJ., concur. MOFFAT, C. J., and PRATT, J., dissent.

OPINION

LARSON, Justice.

This action involves the construction of Section 149 of Chapter 65, Laws of Utah 1937. Plaintiffs were engaged in the business in the State of Utah of motor transportation of property for hire by the use of Diesel engined transports. Between December, 1938, and October, 1939, pursuant to Section 133, Chapter 46, Laws of Utah 1935, as amended by Chapter 65, Laws of Utah 1937, plaintiffs paid to defendants sums aggregating over $ 4,696.45, as Diesel fuel taxes or fees. These payments were made without protest. Plaintiffs filed with defendants claims for refunds of the amounts so paid under the provisions of Section 149, supra. on the grounds that the payments were made through error because the law fixing and exacting the tax or fee was unconstitutional. Defendants denied the claims for refund. Plaintiffs sought mandamus in the District Court to compel defendants to allow and approve the claims for refund. Upon hearing the court denied a permanent writ and plaintiffs appeal. Between the time of payment and the commencement of this action the court in Carter v. State Tax Commission, 98 Utah 96, 96 P.2d 727, 126 A. L. R. 1402, held the diesel fuel tax unconstitutional. The statutes here involved read as follows:

Chapter 65, Laws of Utah 1937, Section 148:

"Whenever any application to the department is accompanied by any fees as required by law and such application is refused or rejected, said fees shall be returned immediately to said applicant."

Section 149:

"Whenever the department through error collects any fee not required to be paid hereunder the same shall be refunded to the person paying the same upon written application therefor made within six months after date of such payment."

The question is: What is the meaning of the expressions "through error collects" and "fee not required to be paid hereunder" as used in the last section quoted? Plaintiffs contend that any collection under an unconstitutional or void statute is a "collection through error" and is one "not required to be paid under the law."

We think the plaintiffs are in error and the trial court was right. The chapter provides for the registration of motor vehicles and the exaction of certain fees therefor. Such fees include the Diesel fuel tax. Carter v. State Tax Commission, supra.

Section 148, quoted above, provides that when an application for registration accompanied by any fees required by law is refused or rejected, the tendered fees shall be returned immediately to the applicant. Such fees should not be converted into, or made a part of, or deposited in the collections of the commission which it is required to transmit daily to the State Treasurer. Section 150. But through error of the personnel either in not discovering in time that the application should be rejected or from other causes the commission converts into its accounts and funds, money collected which the provisions of the chapter do not provide it shall collect, such money shall be refunded upon request. We think the term "through error" means error of the personnel, error of the commission or its employees in operating under the act, and not error of the legislature in enacting the act. It means that the commission may correct its errors, the errors made by its personnel, so as to place the parties where they would have been had the employee not made the error. This is emphasized by the fact that the statute permits refunds through the commission only when through error it has collected any "fee not required to be paid hereunder," that is, any fee which the act as passed by the legislature does not provide it shall collect. In this way it may keep its accounts in harmony with the duties imposed upon it by the terms of the statute as declared by the legislature. It is not for the tax commission to determine questions of legality or constitutionality of legislative enactments. In cases in which legality or illegality of tax sought to be recovered by taxpayer necessarily involves determination of questions of law calling for exercise of strictly judicial functions, payment under protest and compliance with other provisions of the statutes afford the exclusive remedy. Security National Bank v. Twinde et al., 52 S.D. 352, 217 N.W. 542. We cannot suppose that in enacting the law the legislature had in contemplation that its enactments...