Suttles v. Owens-Illinois Glass Co.

• Decision Date: 08 May 1950
• Docket Number: OWENS-ILLINOIS,No. 17070,17070
• Citation: Suttles v. Owens-Illinois Glass Co., 206 Ga. 849, 59 S.E.2d 392 (Ga. 1950)
• Parties: SUTTLES, Tax Collector v.GLASS CO.
• Court: Georgia Supreme Court

Page 392

59 S.E.2d 392

206 Ga. 849

SUTTLES, Tax Collector v. OWENS-ILLINOIS GLASS CO.

No. 17070.

Supreme Court of Georgia.

May 8, 1950.

Syllabus by the Court.

Where the undisputed evidence shows that accounts receivable owned and held by a non-resident corporation arose out of sales of goods made to residents of this State on orders taken by agents of the seller who maintained offices within this State, but which orders expressly provided that they were subject to approval by the home office, that title to any goods sold thereunder would pass to the purchaser upon delivery to the common carrier outside of Georgia, and that no business was conducted in this State, a verdict in favor of the owner, seeking to enjoin the collection of the tax on such accounts, was demanded.

This is a suit by Owens-Illinois Glass Company to enjoin T. E. Suttles, Tax Collector of Fulton County, Georgia, from collecting 1941 State and County taxes assessed against its accounts receivable.

On the trial, the undisputed evidence was as follows: The company is engaged in the manufacture and sale of glass products, and has manufacturing plants in eight or more States, but none in Georgia. The Home Office is at Toledo, Ohio. There the directors meet, dividends are declared, the corporate records are kept, and other general corporate functions are performed. General policies regarding sales and all contracts of sales are made at the Home Office, and all orders are subject to acceptance or rejection there. It is necessary that such decisions be made alone by the Home Office, for the various glass furnaces must be kept running twenty-four hours per day, and to do this one authority must be empowered to reject or accept offers to buy, since the orders must be of such design, quantity, and color in order to keep the different furnaces on full production. In addition, the Toledo Office has various departments such as the Credit and Traffic Departments. The Credit Department procures its information and passes upon all credit sales. The sales agents are not allowed to collect accounts, nor are they consulted about the customer's credit. Purchasers are requested by the invoices to remit to Toledo, and salesmen are not allowed to accept payments. The Traffic Department routes all shipments. The company pays freight only at carload rates and, where there are less than car-load orders, it combines them in pool-car shipments in order to save the buyer freight costs. In Atlanta these pool-car shipments are consigned to Southern Transfer Company, which opens the cars, notifies the local customers, and checks out the merchandise to the buyers; and for this service the company pays Southern Transfer. But all deliveries made by Southern Transfer of the merchandise to the buyer's place of business is done under private contract between the transfer company and the buyer, for which the buyer pays and the seller has no connection. The petitioner maintained two offices in Atlanta--a Sales Office of the Container Division, and an Office of the Insulux Products Division. The function of the Sales Office was to solicit orders throughout the territory, obtain information with respect to the design of glassware desired by the customer, the quantity and colors of that particular design, and pass this on to Toledo for acceptance or rejection. Seasonal contracts to make definite deliveries on an estimated quantity of beverage bottles, dairy containers, or other groups of specialized merchandise were also solicited by the Sales Office, but all contracts were subject to acceptance at the Home Office in Toledo. The Office of the Insulux Products Division was in the charge of a Southeastern representative whose duties were: to select distributors of the company's building merchandise in the territory, submitting distribution contracts to the Toledo office for approval of local distributors; to call upon local architects, engineers, and builders to educate them in the use of glass products; and to promote otherwise the products of this division of the company. One of the local distributors, The Warren Company, a Fulton County corporation, at all times carried adequate stocks of Insulux glass block and accessories, in accordance with its contract with the company, for the purpose of giving prompt and efficient service to dealers, contractors, and owners who purchased within its territory.

At the trial of the case, several witnesses were called to outline the business activities of the company, and numerous exhibits in the form of blank order and contract forms were submitted in evidence. The evidence as given was similar to the brief outline stated above, with particular explanation of the conduct of the business in Toledo, the operation of the two Atlanta offices, the handling of freight by Southern Transfer Company in Atlanta, and the method of distribution of the glass products of the company through one of its local distributors, The Warren Company. This evidence was undisputed, and there was no conflict in the testimony of the various witnesses.

After the introduction of all the evidence, the jury, at the direction of the court, returned a verdict in favor of the plaintiff. Thereupon, the defendant filed a motion for new trial, which was later amended by adding several additional grounds, and thereafter overruled, and the exception is to that judgment.

W. S. Northcutt, Atlanta, Durwood T. Pye, Atlanta, E. A. Wright, Atlanta, James W. Dorsey, Atlanta, for plaintiff in error.

MacDougald, Troutman, Sams & Schroder, Atlanta, John L. Gushman, Toledo, Ohio, for defendant in error.

Alston, Foster, Sibley & Miller, Francis Shackelford, all of Atlanta, for Parties at Interest, not Parties to Record.

DUCKWORTH, Chief Justice.

While tangible property is taxable in the State where it is located, and generally intangibles are taxable in the State where the owner resides, yet there is an exception to this general rule regarding intangibles. That exception is that a debt of a citizen of this State owned by a non-resident and held at his domicile outside of this State is taxable in this State if it accrues out of or is an incident to property owned or a business conducted by the non-resident or his agent in this State. Armour Packing Co. v. Mayor, etc., of City of Savannah, 115 Ga. 140, 41 S.E. 237; Armour Packing Co. v....