Spudich v. Director of Revenue, No. 69393

CourtUnited States State Supreme Court of Missouri
Writing for the CourtROBERTSON; BILLINGS; DONNELLY; WELLIVER; WELLIVER
Citation745 S.W.2d 677
PartiesRobert Philip SPUDICH, d/b/a Columbia Billiard Center, Appellant, v. DIRECTOR OF REVENUE, State of Missouri, Respondent.
Decision Date17 February 1988
Docket NumberNo. 69393

Page 677

745 S.W.2d 677
Robert Philip SPUDICH, d/b/a Columbia Billiard Center, Appellant,
v.
DIRECTOR OF REVENUE, State of Missouri, Respondent.
No. 69393.
Supreme Court of Missouri,
En Banc.
Feb. 17, 1988.
Rehearing Denied March 15, 1988.

Page 678

Harry D. Boul, Columbia, for appellant.

William L. Webster, Atty. Gen., Melodie A. Powell, Asst. Atty. Gen., Jefferson City, for respondent.

ROBERTSON, Judge.

This case presents three issues for review: (1) whether a billiard center which derives substantial revenues from food and beverage sales is nevertheless a place of amusement, entertainment, or recreation within the meaning of Section 144.020.1(2), RSMo 1986, thus subjecting coin-operated amusement devices therein to sales tax; (2) whether Section 144.020.1(2) violates the Equal Protection Clause of the Fourteenth Amendment; and (3) whether billiard tables purchased for display and possible resale are exempt from use tax pursuant to Section 144.615(6), RSMo 1986. The Administrative Hearing Commission found all issues against the taxpayer. This case involves

Page 679

the construction of the revenue laws of this state. We have jurisdiction. Mo. Const. art. V., § 3. Affirmed.

I.

The facts are stipulated. Robert Spudich ("Spudich") is the sole proprietor of Columbia Billiard Center and Spudich Supply Co., both located in Columbia, Missouri. Spudich maintains billiard tables upon which customers may play for a fee. The amount of the fee depends on the length of time a customer plays. In addition to sales of billiard table playing time, Spudich sells food and beverages to his customers, sells and repairs billiard tables and equipment and operates eight coin-operated game devices. From these businesses Spudich realizes revenues as follows:

Activity Percentage Total Revenue
                Food and Beverage Sales 50%
                Equipment Sales and Repair 24%
                Pool Playing Time Charges 23%
                Coin"Operated Amusements 2%
                Miscellaneous 1%
                

To further sales of billiard tables, Spudich purchased billiard tables out-of-state, but remitted no use tax. Spudich permitted no playing on these tables, which were intended for display. According to the stipulation "the tables are used to solicit orders, but one may be sold if that particular table is the last of its kind in inventory, or the customer wants that specific table." Spudich took both depreciation and an investment tax credit on these "display" tables on his federal income tax returns.

Spudich remitted sales tax on fees paid for billiard table playing time; he paid no sales tax on fees paid to operate the coin-operated amusement devices contained in the billiard center. The Director assessed sales tax against the revenues generated by the coin-operated amusement devices. In addition, the Director determined that Spudich owed use tax on the billiard tables held for display and possible sale.

II.

Section 144.020.1(2) provides in pertinent part:

A tax is hereby levied and imposed upon all sellers for the privilege of engaging in the business of selling tangible personal property or rendering taxable service at retail in this state. The rate of tax shall be as follows:

* * *

* * *

(2) A tax equivalent to four percent of the amount paid for admission and seating accommodations, or fees paid to, or in any place of amusement, entertainment or recreation, games and athletic events;

[Emphasis added.]

The Director promulgated 12 C.S.R. 10-3.176, which provides in pertinent part:

(7) A place of amusement, entertainment, or recreation is defined as any place where any facilities are provided (not including coin-operated amusement devices, except as indicated in this rule) for entertainment, amusement, or sports.

(8) Examples of places of amusement, entertainment, or recreation include, but are not limited to ... billiard halls, ...

[Emphasis added.]

A trilogy of cases is important to our consideration. In L & R Distributing, Inc. v. Missouri Department of Revenue, 529 S.W.2d 375 (Mo.1975) (L & R Distributing I ), this Court faced the question whether Section 144.020.1(2) imposed a sales tax on the gross receipts of coin-operated games placed in " 'restaurants, confection areas, bowling alleys, hotels, motels, bus stations, airports and other similar places.' " Id. at 376. The Court gave "defendants the benefit of the doubt" and considered the statute as though it were ambiguous as to the meaning of "a place of amusement, entertainment or recreation." The Court held that such places are not, "within normal contemplation, a place of amusement or entertainment, and that [such places are] not converted into such by the installation of a pinball machine." [Emphasis added.] Id. at 378. The Court found that Section 144.020.1(2) required that two elements be

Page 680

present before a sales tax may be levied: (1) that there be fees or charges and (2) that such fees be paid in or to a place of amusement, entertainment or recreation. Under the facts of the case, the second element was lacking; no sales tax was due.

In Blue Springs Bowl v. Spradling, 551 S.W.2d 596, 597 (Mo. banc 1977), the issue was whether Section 144.020.1(2) imposes a tax on receipts derived from fees or charges paid for participating in the activity of bowling at commercial bowling establishments. The Court there found the statute unambiguous and that a commercial bowling establishment is clearly "within one or more of the categories of places of 'amusement, entertainment or recreation' mentioned in the statute." Id. at 598.

Finally, in L & R Distributing v. Missouri Department of Revenue, 648 S.W.2d 91 (Mo.1983) (L & R Distributing II ), this Court ruled that "the proceeds of coin-operated amusement devices located in places of amusement, etc., are taxable under Section 144.020.1(2)," [Emphasis added.] Id. at 94.

This case presents a question not answered in prior cases. Here, we are required to consider the meaning of the phrase "places of amusement, entertainment or recreation." More precisely, the issue is whether a billiard center, which derives more than half its revenues from services and sales other than fees paid for the purchase of billiard playing time, is a place of amusement, etc., within the meaning of Section 144.020.1(2).

There being no statutory definition for a place of amusement, we turn to familiar canons of construction for assistance. The purpose of statutory construction is to seek the intent of the legislature. Metro Auto...

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  • State ex rel. Coker-Garcia v. Blunt, COKER-GARCI
    • United States
    • Court of Appeal of Missouri (US)
    • January 19, 1993
    ...and consideration are to be given to administrative interpretations by those charged with its execution. Spudich v. Director of Revenue, 745 S.W.2d 677, 680 (Mo. banc The language of section 115.315 is unclear in regard to whether district or county candidates for a new political party are ......
  • Burlington Northern R.R. v. Director of Revenue, Nos. 71651
    • United States
    • United States State Supreme Court of Missouri
    • March 13, 1990
    ...538 S.W.2d 313, 317 (Mo.1976), and the agency's interpretation generally is to be given great weight. Spudich v. Director of Revenue, 745 S.W.2d 677, 680 (Mo.banc 1988). However, when an administrative agency's decision is based on the agency's interpretations of law, the reviewing court mu......
  • State v. Public Service Commission, No. WD 63580 (MO 12/7/2004), No. WD 63580
    • United States
    • Missouri Supreme Court
    • December 7, 2004
    ...are given to administrative interpretations of statutes where the meaning of a statute is uncertain," Spudich v. Dir. of Revenue, 745 S.W.2d 677, 680 (Mo. banc 1988) (citing Foremost-McKesson, Inc. v. Davis, 488 S.W.2d 193, 197 (Mo. banc 1972)), when, as here, "an administrative a......
  • GTE Automatic Elec. v. Director of Revenue, State of Mo., No. 71539
    • United States
    • Missouri Supreme Court
    • November 14, 1989
    ...Court may not read use tax exemptions into the statute unless they clearly and expressly appear therein. Spudich v. Director of Revenue, 745 S.W.2d 677, 682 (Mo. banc 1988). Under the clear terms of the statutory scheme, the exemptions in question do not apply to telecommunications and we w......
  • Request a trial to view additional results
10 cases
  • State ex rel. Coker-Garcia v. Blunt, COKER-GARCI
    • United States
    • Court of Appeal of Missouri (US)
    • January 19, 1993
    ...and consideration are to be given to administrative interpretations by those charged with its execution. Spudich v. Director of Revenue, 745 S.W.2d 677, 680 (Mo. banc The language of section 115.315 is unclear in regard to whether district or county candidates for a new political party are ......
  • Burlington Northern R.R. v. Director of Revenue, Nos. 71651
    • United States
    • United States State Supreme Court of Missouri
    • March 13, 1990
    ...538 S.W.2d 313, 317 (Mo.1976), and the agency's interpretation generally is to be given great weight. Spudich v. Director of Revenue, 745 S.W.2d 677, 680 (Mo.banc 1988). However, when an administrative agency's decision is based on the agency's interpretations of law, the reviewing court mu......
  • State v. Public Service Commission, No. WD 63580 (MO 12/7/2004), No. WD 63580
    • United States
    • Missouri Supreme Court
    • December 7, 2004
    ...are given to administrative interpretations of statutes where the meaning of a statute is uncertain," Spudich v. Dir. of Revenue, 745 S.W.2d 677, 680 (Mo. banc 1988) (citing Foremost-McKesson, Inc. v. Davis, 488 S.W.2d 193, 197 (Mo. banc 1972)), when, as here, "an administrative a......
  • GTE Automatic Elec. v. Director of Revenue, State of Mo., No. 71539
    • United States
    • Missouri Supreme Court
    • November 14, 1989
    ...Court may not read use tax exemptions into the statute unless they clearly and expressly appear therein. Spudich v. Director of Revenue, 745 S.W.2d 677, 682 (Mo. banc 1988). Under the clear terms of the statutory scheme, the exemptions in question do not apply to telecommunications and we w......
  • Request a trial to view additional results

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