Trailiner Corp. v. Director of Revenue, 71793
| Decision Date | 13 February 1990 |
| Docket Number | No. 71793,71793 |
| Parties | TRAILINER CORPORATION, Appellant, v. DIRECTOR OF REVENUE, Respondent. |
| Court | Missouri Supreme Court |
Robert L. Hyder, Jefferson City, for appellant.
J. Kent Lowry, Jefferson City, for amicus curiae.
William L. Webster, Atty. Gen., Mark S. Siedlik, Asst. Atty. Gen., Jefferson City, for respondent.
In this appeal, the dispositive issue is whether the term "motor vehicles" in § 144.030.2(3) 1 encompasses refrigerated or other large trailer units used as common carriers in the interstate transportation of persons and property. We conclude that such trailer units fall within the purview of the section and purchases of repair and replacement parts therefor are entitled to the exemption from state and local sales tax provided by the statute. The cause involves construction of the revenue laws, bringing it within the bounds of this Court's original appellate jurisdiction. Mo. Const. art. V, § 3.
Trailiner Corporation (Trailiner), based in Springfield, Missouri, is a New Jersey corporation licensed to do business in this state as a common carrier. It operates exclusively in interstate commerce transporting frozen perishables by use of truck-tractors pulling refrigerated trailer units. In September of 1987, agents of the Director of Revenue (Director) conducted an audit of Trailiner's records for the period August 1, 1982, through July 31, 1987. From this audit, the Director assessed additional taxes, interest and penalties of reportedly delinquent sales/use taxes on Trailiner's purchases of replacement and repair parts for its refrigeration trailer units. 2 Two separate installments of assessments were mailed to Trailiner in 1988, the first on February 26 and the second May 13. Trailiner appealed to the Administrative Hearing Commission on May 24 of that year, contending the items assessed for sales/use tax were exempt under § 144.030.2(3).
The Commission 3 ruled it could not entertain an appeal from the February 26, assessment because the allotted time had expired prior to Trailiner filing its appeal. § 621.050.1. That ruling as to timeliness appears valid on its face and is not challenged here by appellant. As to the May 13, assessments, the Commission determined that the term "motor vehicle" in § 144.030.2(3), RSMo Supp.1988, 4 did not include trailers and affirmed the Director's assessment. The Commission also held that a new policy position of the Director promulgated January 1, 1988, exempting trailers under § 144.030.2(3) was erroneous and nullified the same. 5
Although Trailiner raises three points on appeal, we need only address the first because its resolution puts the matter to rest. Trailiner asserts that the term "motor vehicles" in § 144.030.2(3) includes trailers of the type Trailiner employs in its day-to-day operations. Section 144.030.2(3) exempts from local and state sales tax:
Materials, replacement parts and equipment purchased for use directly upon, and for the repair and maintenance or manufacture of, motor vehicles, watercraft, railroad rolling stock or aircraft engaged as common carriers of persons or property ... (Emphasis added.)
To bolster its argument in support of the claimed exemption, Trailiner directs our attention to § 144.030.2(11), effective August, 1985, which supplanted § 144.030.3(10), RSMo 1978. These subsections deal with the "purchase of motor vehicles" as distinguished from the purchase of "parts" in the subsection under consideration. The earlier statute exempted from sales/use tax railroad rolling stock, but this exemption was broadened in 1985 by § 144.030.2(11) to include motor vehicles licensed for a gross weight of 24,000 pounds and certain trailers. More specifically, that subsection reads:
Railroad rolling stock for use in transporting persons or property in interstate commerce and motor vehicles licensed for a gross weight of twenty-four thousand pounds or more or trailers used by common carriers as defined in section 390.020, RSMo, solely in the transportation of persons or property in interstate commerce ... (Emphasis added.)
Further, § 390.020(6), a definitional statute referenced in the above-cited subsection, states:
"Common carrier", any person which holds itself out to the general public to engage in the transportation by motor vehicle of passengers or property for hire or compensation upon the public highways and airlines engaged in intrastate commerce ... (Emphasis added.)
"Motor vehicle" is further defined in § 390.020(19) as:
... any vehicle, truck, truck-tractor, 6 trailer, or semitrailer, motor bus or any self-propelled vehicle used upon the highways of the state in the transportation of property or passengers ... (Emphasis added.)
While, as mentioned above, the tax consequences of sales of trucks and trailers is not before us for determination, the legislative extension of the exemptions to such sales is accompanied by the reference to definitions in § 390.020 effectively removing any doubt as to legislative intent. It is significant that the 1985 statute which repeats the explanatory theme of trucks or trailers used "in the transportation of persons or property" is consistent with the theme woven into the language of § 144.030.2(3). In essence, Trailiner persuasively argues that the definition to be given "motor vehicle" in § 144.030.2(3) should be that found in § 390.020(19).
When examining for the meaning of statutory enactments, our primary role is to ascertain the intent of the legislature from the language used and give effect to that intent if possible. King v. Laclede Gas Co., 648 S.W.2d 113, 115 (Mo. banc 1983). In so doing the words in the statute are to be considered in their plain and ordinary meaning. Donahue v. City of St. Louis, 758 S.W.2d 50, 52 (Mo. banc 1988). Tax statutes are to be strictly construed in favor of the taxpayer and against the taxing authority, Staley v. Missouri Director of Revenue, 623 S.W.2d 246, 250 (Mo. banc 1981); however, exemption provisions are construed against the taxpayer. Missouri Public Service Co. v. Director of Revenue, 733 S.W.2d 448, 449 (Mo. banc 1987).
We note that § 144.030.2(3) exempts materials, replacement parts and equipment purchased to repair and maintain motor vehicles "engaged as common carriers of persons or property". Common sense dictates that a truck-tractor without a connected trailer is neither equipped, designed nor intended to transport property or persons other than a driver (and perhaps a relief driver) and personal belongings. The Director conceded in oral argument that truck-tractors do meet the exemption requirements under § 144.030.2(3) as motor vehicles engaged as common carriers of persons and property. Nevertheless, the Commission somehow determined a trailer was not intended by the legislature to be included in the exemption. It so found though a truck-tractor can only be engaged as a "common carrier" to transport persons and property when connected to and used in conjunction with a trailer. Manifestly, without such a trailer, a truck-tractor is little more than an oversized, odd-shaped automobile and not a carrier for the transporting of persons and property.
The Director asserts that the proper definition for "motor vehicle" is to be found in Chapter 301 relating to registration and licensing of motor vehicles. In § 301.010(26) "motor vehicle" is defined as "any self-propelled vehicle not operated exclusively upon tracks, except farm tractors and all-terrain vehicles." Further, § 301.010(48) defines trailer as:
"Trailer", any vehicle without motive power designed for carrying property or passengers on its own structure and for being drawn by a self-propelled vehicle, except those running exclusively on tracks, including a semitrailer or vehicle of the trailer type so designed and use in conjunction with a self-propelled vehicle ...
From this, the Director contends the legislature must have meant for a trailer to be considered separate and distinct from the term "motor vehicle" for purposes of § 144.030.2(3), because it defined the terms separately under the licensing and registrations provisions of Chapter 301. This reliance upon § 301.010(26) for the definition of "motor vehicle" is of little relevance to our resolution of the issue here. In our perusal of current sta...
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