Tri-State Motor Transit Co. v. Holt
| Decision Date | 07 May 1996 |
| Docket Number | Nos. 20500,20501 and 20502,TRI-STATE,s. 20500 |
| Parties | MOTOR TRANSIT CO., Plaintiff-Respondent, v. Stephen H. HOLT, Tax Collector for Jasper County, Missouri, Defendant-Appellant, and Cindy Troutman, City Collector for City of Duenweg, Missouri, Defendant. |
| Court | Missouri Court of Appeals |
James R. Spradling, Carthage, for appellant.
D. Patrick Sweeney, Springfield and Deborah K. Dodge, Hall, Ansley, Rodgers & Condry, P.C., Springfield, for respondent.
This consolidated appeal concerns three cases wherein Stephen H. Holt, tax collector for Jasper County (Collector), appeals from a judgment that ordered him to repay Tri-State Motor Transit Co. (Plaintiff) part of the personal property taxes paid by it under protest for 1992, 1993, and 1994. 1 The trial court entered the judgment alternatively, finding that Plaintiff was entitled to relief based on the protest statute, § 139.031, and also under the "illegal levy" provision, § 139.290. 2 We affirm.
No evidentiary hearing was conducted by the circuit court. The following is drawn from a joint stipulation of facts filed by the parties with the circuit court.
In 1992, 1993, and 1994, Plaintiff operated a tractor-truck and trailer fleet in interstate commerce and acquired tax situses in states other than Missouri. For each year in question, Plaintiff prepared and submitted to the Jasper County assessor a list of all equipment owned and leased by it. The assessor's office also had data from the Missouri Highway Reciprocity Commission from which it could and did determine the percentage of miles traveled annually by all of Plaintiff's vehicles attributable to Missouri, specifically, 6% in 1992, 6% in 1993, and 7.01% in 1994.
An order of the State Tax Commission, first promulgated in 1983 and in effect at all times pertinent here, declared that the State could not levy a property tax on the full value of vehicles that are engaged in interstate commerce and have acquired a tax situs in other states (citing Ott v. Mississippi Valley Barge Line Co., 336 U.S. 169, 69 S.Ct. 432, 93 L.Ed. 585 (1949); Standard Oil Co. v. Peck, 342 U.S. 382, 72 S.Ct. 309, 96 L.Ed. 427 (1952)). The Commission further declared that a tax on the instrumentalities of interstate commerce may not be sustained unless the tax is fairly apportioned (citing Maryland v. Louisiana, 451 U.S. 725, 754, 101 S.Ct. 2114, 2133, 68 L.Ed.2d 576 (1981)). To meet the fair apportionment requirement for taxing instrumentalities of interstate commerce, the Commission recommended the use of this assessment formula:
True value of % of miles of all trucks
all trucks x combined attributable x 33 1/3
[and trailers] to Missouri
In the stipulation, Collector acknowledged that "[s]aid 1983 order is still valid and is controlling on all Assessed Valuations of interstate trucks and trucking fleets and is to be followed by all county assessors."
The county assessor did not use the formula found in the Commission's order to compute Plaintiff's personal property taxes for the three years in question. Instead, he assigned a "minimum" assessed value to each of Plaintiff's interstate vehicles without applying the mileage ratio to those minimum values. Although the record is less than clear on the subject, apparently the assessor arrived at his minimum assessed value by assigning to each vehicle a "true" value as if it were a 1981 model (without regard to that vehicle's actual age and true value) and then multiplied the 1981 true value for that model truck or trailer by 33 1/3rd percent. The resulting "minimum" assessed value did not take into account the percentage of miles attributable to Missouri nor did it assign a true value to the vehicle (unless it happened to be a 1981 model).
Whenever the assessor's "minimum" valuation method produced a higher valuation than did the recommended formula, the assessor assigned the higher figure as the assessed value on the particular vehicle. Consequently, for the years 1992, 1993, and 1994 combined, Collector collected $389,974 in personal property taxes from Plaintiff, whereas under the recommended formula, Plaintiff would have owed $136,272 in personal property taxes for the same period--a difference of $253,702.
Plaintiff timely paid the taxes in 1992, 1993, and 1994 to Collector and Troutman. Each payment was accompanied by a protest letter as required by § 139.031.1. 3 In the protest letters, Plaintiff charged that the valuation method used by Jasper County officials did not apportion taxes between Missouri and other states entitled to tax such property. In its 1994 protest letter, Plaintiff specifically complained that the lack of apportionment violated the Due Process and Commerce Clauses of the United States Constitution. Each of Plaintiff's letters further advised Collector and Troutman that it intended to rely on both § 139.031 and § 139.290 to recover the disputed taxes.
Plaintiff then timely filed petitions in 1993, 1994, and 1995 in the circuit court seeking to recover the taxes it paid under protest. Counts I and II of each petition sought recovery from Collector of the portion of the disputed taxes paid to him. 4
After the three cases were consolidated, Collector moved for dismissal of Plaintiff's petitions because Plaintiff did not first exhaust its administrative remedies for relief, i.e., by appealing first to the Board of Equalization, and then to the State Tax Commission. The court overruled Collector's motion to dismiss, saying:
"With regard to Count[ ] I ... plaintiff is properly before this Court ... [as] plaintiff has complied with Section 139.031 ... [and] the issue disputed is purely constitutional....
....
The circuit court concluded that Counts I and II were pled in the alternative, found "the issues in Counts I and II of the Consolidated Petition ... in favor of Plaintiff ... and against Collector ... [,]" and awarded Plaintiff damages of $253,702 and interest earned. This appeal by Collector followed.
Collector's first point on appeal maintains that the trial court erred when it overruled Collector's motion to dismiss because Plaintiff "failed to exhaust its administrative remedies in that it did not appeal its assessment to the Jasper County Board of Equalization and subsequently to the state tax commission prior to filing suit in the circuit court."
To support his argument, Collector cites Stout Industries, Inc. v. Leachman, 699 S.W.2d 129 (Mo.App.1985), Connors v. Leachman, 740 S.W.2d 376 (Mo.App.1987), and Nexus Rent-A-Car, Inc. v. Nash, 747 S.W.2d 683 (Mo.App.1988), cases where the taxpayers' suits to recover protested taxes were brought pursuant to § 139.031. 5 Those cases state the general rule that a taxpayer who utilizes the § 139.031 remedy to recover protested taxes must exhaust his administrative remedies, even at times when constitutional claims are raised. See, e.g., Connors, 740 S.W.2d at 378; Stout, 699 S.W.2d at 131. Thus, "[i]f the taxpayer is challenging the statute as unconstitutional in its application or administration, administrative remedies must be exhausted." Connors, 740 S.W.2d at 378, n. 2 (citing Stout, 699 S.W.2d at 131). The exception occurs when the sole issue raised by the taxpayer is the constitutionality of a statute on its face; in that instance exhaustion of administrative remedies is not required. Connors, 740 S.W.2d at 378; Stout, 699 S.W.2d at 131.
Collector contends that "[t]his case was not a challenge to the constitutionality of the assessment but rather to its interpretation," and consequently Plaintiff was required to exhaust its administrative remedies before proceeding in circuit court. Since Plaintiff did not appeal to the board of equalization or the State Tax Commission, Collector insists the trial court committed reversible error in overruling his motion to dismiss Plaintiff's consolidated petition.
We need not, however, decide Collector's first point. Collector's argument addressing the exhaustion of remedy issue focuses exclusively on Plaintiff's first count (brought under § 139.031) and wholly ignores the trial court's decision that pursuant to Ackerman Buick, Inc. v. St. Louis County, 771 S.W.2d 343 (Mo. banc 1989), Plaintiff could proceed under Count II (§ 139.290) without pursuing administrative remedies.
Ackerman established that a taxpayer who seeks a refund of taxes paid under protest may have a remedy available under § 139.290 6 separate and apart from § 139.031. Id. at 345-46. The elements of a § 139.290 action are explained in Ackerman thusly:
"Section 139.290 ... requires: (1) that there be an illegal levy (as determined by the Missouri Supreme Court) and (2) that the disputed monies be either in the county treasury or within the control of the county commission before the county commission is authorized to refund the disputed monies."
Id. at 345, n. 4. Finally, Ackerman allows taxpayers who...
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