Texas Co. v. State

• Decision Date: 04 April 1927
• Docket Number: Civil 2506
• Citation: 31 Ariz. 485,254 P. 1060
• Parties: THE TEXAS COMPANY, a Corporation, Appellant, v. STATE, Respondent
• Court: Arizona Supreme Court

254 P. 1060

31 Ariz. 485

THE TEXAS COMPANY, a Corporation, Appellant, v. STATE, Respondent

Civil No. 2506

Supreme Court of Arizona

April 4, 1927

APPEAL from a judgment of the Superior Court of the County of Maricopa. Joseph S. Jenckes, Judge. Judgment reversed and cause remanded, with instructions.

Messrs Prosser & Freeman, Mr. Edward J. Flanigan and Messrs Ellinwood & Ross, for Appellant.

Mr John W. Murphy, Attorney General, and Mr. A. R. Lynch Assistant Attorney General, for the State.

OPINION

LOCKWOOD, J.

In 1921 the fifth legislature of the state of Arizona passed chapter 116 of the Session Laws of that year, being an act entitled "To provide a license tax on gasoline; to provide for the collection thereof, . . . " and for other purposes. Sections 1, 2 and 7 thereof read as follows:

"Section 1. Definition. The following words, terms and phrases in this act are, for the purposes thereof, defined as follows:

"(a) The term 'dealer' is hereby defined as any person, firm or corporation who imports or causes to be imported gasoline for use, distribution or sale in, and after the same reaches the state of Arizona; and also any person, firm or corporation who produces, refines, manufactures or compounds such gasoline in the state of Arizona for use, distribution or sale in this state.

"Sec. 2. That in addition to the taxes now provided for by law, each and every dealer, as defined in this act, who is now engaged or who may hereafter engage in his own name, or in the name of others, or in the name of his representatives or agents in this state, in the sale or distribution, as dealers and distributors of gasoline shall not later than the fifteenth (15) day of each calendar month render a statement to the secretary of state of the state of Arizona of gasoline sold or distributed by him or them in the state of Arizona during the preceding calendar month, and pay a license tax of one (1) cent per gallon on all gasoline so sold or distributed, as shown by such statement in the manner and within the time hereinafter provided, which tax shall be added to the sales price of the dealer as herein defined." [Italics ours.]

"Sec. 7. Said license tax shall not be imposed on gasoline when sold for exportation from the state of Arizona to any other state or nation."

The act further provided that all dealers in gasoline should file a certificate showing various matters in regard to the character of the dealer and its responsible officials or agents; that they should render proper reports of the gasoline sold, keep a record of their purchases and sales, and pay the tax so levied to the Secretary of State at certain times and in a certain manner.

In 1922 the same legislature in special session (chapter 24) amended sections 2 and 7 above quoted to read as follows:

"Sec. 2. That in addition to the taxes now provided for by law, each and every dealer, as defined in this act, who is now engaged or who may hereafter engage in his own name, or in the name of others, or in the name of his representative or agents in this state, in the sale or distribution, as dealers and distributors of gasoline shall not later than the fifteenth (15) day of each calendar month render a statement to the secretary of state of the state of Arizona of gasoline sold or distributed by him or them in the state of Arizona during the preceding calendar month, and collect a license tax of one (1) cent per gallon on all gasoline so sold or distributed, as shown by such statement in the manner and within the time hereinafter provided, which tax shall be added to the sale price of the dealer as herein defined." [Italics ours.]

"Sec. 7. Said license tax shall not be imposed on gasoline when sold for exportation from the state of Arizona to any other state or nation or when sold to the government of the United States or any agencies thereof."

In pursuance of these acts the Texas Company, a corporation, hereinafter called appellant, filed its certificate as dealer and rendered its accounts and made payments to the Secretary of State as provided in the acts up to June 9th, 1923. During this period appellant was primarily a manufacturer selling at wholesale gasoline made by it and brought into the state of Arizona for the purpose of thus being sold at wholesale. It neither owned nor operated any so-called "filling stations" within the state, and the small quantity of gasoline which it sold direct to consumers represented an exception to its general policy of selling only at wholesale.

In 1923 the sixth legislature in regular session passed and sent to the Governor Senate Bill No. 156, entitled "An act . . . providing for the raising of funds . . . by means of . . . a tax . . . upon gasoline and other distillates of crude petroleum, . . . " and for other purposes. Section 10 of the bill was divided into three subsections, and subsection 3 had some nine paragraphs, lettered (a) to (i), inclusive. Those paragraphs material to the determination of this case are quoted below:

"(a) That each and every dealer, as defined in this act, who is now engaged or who may hereafter engage in his own name, or in the name of others, or in the name of his representative or agents of this state in the sale, use or distribution, as dealers and distributors of gasoline or other distillates of crude petroleum shall not later than the fifteenth (15) day of each calendar month render a statement to the secretary of state of the state of Arizona of gasoline and other distillates of crude petroleum sold, used or distributed by him or them in the state of Arizona during the proceeding calendar month, and collect a license tax of three (3) cents per gallon on all gasoline and other distillates of crude petroleum so sold, used or distributed for use in motor propelled or motor driven vehicles, as shown by such statement in the manner and within the time hereinafter provided, which tax shall be added to the sale price of the dealer as herein defined when sold, used or distributed for such use in said motor propelled or motor driven vehicles only."

"(c) Every dealer in gasoline and other distillates of crude petroleum shall render to the secretary of state of the state of Arizona, on or before the fifteenth (15) day of each month, on forms prescribed, prepared and furnished by the secretary of state, a sworn statement of the number of gallons of gasoline and other distillates of crude petroleum sold or used by him or them during the preceding calendar month together with the number of gallons of gasoline or other distillates of crude petroleum sold or used by him or them during the preceding calendar month for use in motor propelled or motor driven vehicles as defined herein, which statement shall be sworn to by one of the principal officers in case of a domestic corporation or by the resident general agent or attorney in fact in case of a foreign corporation by the managing agent or owner in case of a firm association, and shall contain the total number of gallons of gasoline and other distillates of crude petroleum, sold, used or distributed. Bills shall be rendered to all purchasers of gasoline or other distillates of crude petroleum by dealers, as herein defined. Said bills shall contain a statement printed thereon in a conspicuous place that the dealer in gasoline has assumed the liability to the state for the license tax herein imposed and that he or they will pay said license tax on or before the fifteenth (15) day of the following month. In addition to the statement herein prescribed, the dealer shall present to the secretary of state, on a form prescribed, prepared and furnished by the secretary of state, a statement signed by the purchaser of any gasoline or other distillates of crude petroleum purchased for any other purpose than use in motor propelled or motor driven vehicles as herein defined, showing the number of gallons of gasoline or other distillates of crude petroleum so purchased, and the purpose of use for which such gasoline or other distillates of crude petroleum is purchased. Failure to present such statement so signed by said purchaser shall be prima facie evidence that the gasoline or other distillates of crude petroleum was sold or distributed by said dealer for use in motor propelled or motor driven vehicles as herein defined, and the dealer shall pay the license tax herein prescribed on all such gasoline and other distillates of crude petroleum not accounted for by such statement from such purchaser."

"(f) Said license tax shall not be imposed upon gasoline and other distillates of crude petroleum when sold for exportation from the state of Arizona to any other state or nation, or when sold to the government of the United States or when sold or distributed for use in motor propelled or motor driven farm tractors or other motor propelled or motor driven farm machinery and implements, or motor propelled or motor driven vehicles running only upon rails or tracks."

"(h) Whenever any dealer as defined herein shall fail to pay such license tax as herein provided for a period of thirty (30) days from and after the date when the same should have been paid as required by this act, the Attorney General shall commence and prosecute to final determination an action at law to collect the same.

"(i) The following words, terms and phrases used in this subdivision are, for the purposes thereof, defined as follows:

"The term 'dealer' is hereby defined as any person, firm or corporation who imports or causes to be imported gasoline or other distillates of crude petroleum for use, distribution or sale in, and after the same reaches the state of Arizona; and also any person, firm or corporation who produces, refines, manufactures or compounds such gasoline or...