Treas v. Price

• Decision Date: 06 March 1933
• Docket Number: 30333
• Citation: 146 So. 630,167 Miss. 121
• Court: Mississippi Supreme Court
• Parties: TREAS v. PRICE, AUDITOR OF PUBLIC ACCOUNTS

146 So. 630

167 Miss. 121

TREAS v. PRICE, AUDITOR OF PUBLIC ACCOUNTS

No. 30333

Supreme Court of Mississippi

March 6, 1933

Division A

1. LICENSES. Where manner in which filling station operator as agent of unincorporated association organized to permit members to obtain gasoline without paying privilege tax differed in no material respect from that in which operator would have handled gasoline as ordinary retail dealer operator held liable for tax (Code 1930, section 4786).

Filling station operator was liable for privilege tax under Code 1930, section 4786, on gasoline handled as agent of the unincorporated association, since it appeared that although members of the association who desired gasoline would give written order therefor, and that when the operator had received orders for gasoline sufficient to fill a tank car he would order such car from nonresident dealer; that when the car arrived the gasoline was transferred to tanks set apart by operator for that purpose; that the quantity ordered by each member of association would then be delivered to him that when delivering gasoline to members who had made orders members who had not given orders would be called on and gasoline delivered to them if they wanted it; and that if any one not member of association should desire gasoline the operator would take order and deliver gasoline if party desiring it paid therefor and became member of association.

2 ASSOCIATIONS.

Unincorporated association could not, as such, own property.

3 ASSOCIATIONS.

Contract in unincorporated association's name made by agent thereof would not bind members personally, but only agent.

4. COMMERCE.

Privilege tax on gasoline neither sold nor distributed in package in which it was shipped from sister state, but only after it had been transferred therefrom and in broken quantities, held not objectionable as burden on interstate commerce (Code 1930, section 4786; Const. U.S., art. 1, section 8, cl. 3).

5. LICENSES.

Promise, voluntarily made in bond executed for privilege of selling gasoline, to pay attorney's fees and other expenses incurred in collecting privilege tax and penalty held enforceable, although not required by statute (Code 1930, section 2901; section 4785 et seq.).

HON. JAS. A. FINLEY, Chancellor.

APPEAL from chancery court of Monroe county HON. JAS. A. FINLEY, Chancellor.

Suit by Joe S. Price, auditor of public accounts, against Charles Treas. From an adverse decree, defendant appeals. Affirmed.

The articles of agreement requested to be reported follow:

"We the undersigned, persons engaged in agricultural and/or other pursuits, owning and/or operating engines, tractors and/or other machinery using and/or consuming gasoline, kerosene, oil and other products manufactured from crude oil, in order to secure gasoline at cost for use in said engines, tractors and/or other machinery so operated by me at cost plus unloading, storage and/or distribution, and which gasoline when received will not be for sale within the state and/or used on the streets, roads, or highways thereof, do hereby organize ourselves into a co-operative gasoline buying association to be, and which is hereby named: 'Tax-Free Co-operative Gasoline Association,' which shall have its domicile at Aberdeen, Monroe county, Mississippi, for the purpose of ordering and having shipped without the state to us and for our account, within the state, gasoline in tank car lots; and

"To this end, we and each of us, do hereby nominate, constitute and appoint the Aberdeen Lumber Company and/or the Alco Service Station as our agents for the purpose of ordering and/or buying from without the state such quantities of gasoline as we, and each of us, from time to time may designate by previous written order or orders to them, or either of them, to buy and/or purchase for our account and store the same when received in a separate tank and/or tanks to be owned by them, or either of them, to be used solely and exclusively for storage of gasoline ordered by us and distributed as we may from time to time need the same for use in the operation of our respective enterprises, for which services as our agent in unloading, storing, and distributing they, or either of them shall receive and be paid a reasonable amount to be fixed by agreement from time to time between them, or either of them, and ourselves; but with the distinct understanding that said gasoline so ordered and shipped for our account will not be for sale within the state or used on the streets, roads, or highways thereof, and that it will not be commingled with any such gasoline in said tank and/or tanks.

"We, and each of us, do hereby pledge ourselves to protect the integrity of this agreement, and that the gasoline so ordered shipped, stored for and distributed to us under this agreement will not be sold in the state of Mississippi, or used on the streets, roads and highways thereof, and that it will not be commingled with gasoline which is to be sold in said state, or used on the streets, roads, or highways thereof, and in event of any violation of this agreement by any one, or either of us then such of us as do violate this agreement in such particular shall be held responsible to this association for any tax, penalties or damages that may follow as a result of such violation thereof but no member of said association shall be held responsible for the violation of this agreement by any other member.

"In witness whereof, we have hereunto set our hands by signing and delivering this instrument on the -- day of March, 1931.

"[List of signatures.]"

Affirmed.

D. W. Houston, Sr., D. W. Houston, Jr., and E. E. Holley, all of Aberdeen, for appellants.

The property and title to the gasoline in question was in the Tax-Free Gasoline Co-operative Association, the individual members thereof constituted this association and were necessary and constituent elements of same, and the property and title in said gasoline being already in them, the logical and inescapable conclusion is that they could not buy from themselves that which was already their own.

There is no showing that said association was either a distributor or wholesaler of gasoline. The proof is that it was an association of individuals joined together under a valid, legal and subsisting agreement for the purpose of furnishing to its members gasoline for agricultural and industrial uses by the association itself ordering through its agent from without the state to be shipped to it within the state in cooperative tank car lots, and there distributed to them as needed, and to them and alone and not to some third person not a member of said cooperative association.

It was on the point of whether a sale was committed within the state that the court below made its decision. In other words, the testimony was so overwhelmingly clear in favor of our contention that no part of this gasoline had been used on the streets, roads and highways of the state that that question of fact was decided in our favor, and that the only question for decision was one of law as to whether a sale or sales were committed in this state, which the court held against us.

The statute says "for sale," and when it says "for sale," it means just what it says and no more and no less, for this statute fixing a tax must be literally and most strictly construed against the taxing power and most liberally in favor of the person or persons against whom the tax is sought to be fixed or assessed.

Petroleum Co. v. Miller, 154 Miss. 576; R. R. v. State, 62 Miss. 106; Simmons v. State, 70 Miss. 845, 12 So. 477; Wilby v. State, 93 Miss. 767, 47 So. 465; State v. Grenada, 123 Miss. 191, 85 So. 137; Sperry v. Harbison, 123 Miss. 674, 86 So. 455; Cuevas v. Cuevas, 145 Miss. 456, 110 So. 865; Board Levee Commissioners v. Howse, etc., 149 Miss. 843, 116 So. 92.

The lower court is in error and misconceived the testimony adduced on the trial of this case when it held that the evidence rebuts the theory that the Tax-Free Cooperative Gasoline Association was a legal entity or that the members so ordering had no common interest in the gasoline shipped to said association, and that the appellants were not designated as the agent of the Tax-Free Co-operative Gasoline Association, an undisclosed principal, and that therefore said gasoline was received in Mississippi for sale.

In determining a sale, it, of course, becomes important where the sale was made of the gasoline. Our contention borne out by the undisputed facts on the record, and the record alone, is that there was only one sale made, and that sale was made, consummated and effected in Memphis, Tennessee.

Couret v. Conner, 79 So. 230.

Ordinarily where goods are sold to be shipped to the buyer by carrier, the title passes to the buyer on delivery to the carrier, he being regarded as the buyer's agent for the purpose of delivery, and this will ordinarily be deemed the place of sale.

23 R. C. L. 1256; Harper v. State, 91 Ark. 422, 121 S.W. 737; Sledge Norfleet Co. v. Hugh (Ark.), 247 S.W. 1077; Hendren v. Wing, 60 Ark. 561, 31 S.W. 149.

The title passed to and the same was the property of the Tax-Free Co-operative Gasoline Association.

Section 4789 of the Code says "Sale," it does not say bartering, exchanging or loaning. It says what it means and means what it says: "Sale," and for this court to apply the tax it would be necessary for it to interpolate into this statute the word "loan," which would be in effect judicial legislation, and including therein something that was never intended by the legislature, and which will not be permitted by our courts as has often been held.

R. R. v. State, 62 Miss. 105; Comrs. v. Howse, 149 Miss. 843.

A tax on such a transaction as the...