Wiseman v. Madison Cadillac Company

• Decision Date: 23 December 1935
• Docket Number: 4-4204
• Citation: 88 S.W.2d 1007,191 Ark. 1021
• Parties: WISEMAN v. MADISON CADILLAC COMPANY
• Court: Arkansas Supreme Court

88 S.W.2d 1007

191 Ark. 1021

WISEMAN v. MADISON CADILLAC COMPANY

4-4204

Supreme Court of Arkansas

December 23, 1935

Appeal from Pulaski Chancery Court; Frank H. Dodge, Chancellor reversed.

Decree reversed, and cause dismissed.

Carl E. Bailey, Attorney General, Thomas Fitzhugh, Assistant, and Millard Alford, for appellant.

Owens & Ehrman, John M. Lofton, Jr., and E. L. McHaney Jr., for appellee.

OPINION

MEHAFFY, J.

The appellee brought this suit in the Pulaski Chancery Court alleging that the General Assembly of the State of Arkansas for 1935 enacted a law known as the Arkansas Emergency Retail Sales Tax Law (act 233 of the Acts of 1935); that the act contained certain exemptions, among others, there was exempt from the provisions of the act, in any case where there is already a privilege tax or a license tax imposed, equal to the amount of such already imposed privilege tax or license. The section relied on is § 15, and is as follows:

"Section 15. Exemptions. There are hereby specifically exempted from the taxes levied in this act: a. Retail sales which are prohibited from taxes by the Constitution or laws of the United States of America or by the Constitution of this State. b. A portion of all retail sales on articles and/or commodities on which a State privilege tax imposed in this act shall be an amount equal to whatever is the excess above the already imposed privilege tax or license. c. If the application of the tax provided in this act on the retail sale of any article or commodity is found to be unconstitutional, it is specifically understood that the validity of this act shall be affected only as relates to said articles and will not affect the validity of the tax imposed on other articles in this act.

"All foods necessary to life, more specifically defined as follows: flour, meat, lard, sugar, soda, baking powders, salt, meal, butter fats, eggs, and all medicines necessary for the preservation of public health, each of above to be exempt from the provisions of this act."

It was further alleged that at the time of the passage of the sales tax law there was already imposed a privilege or license tax upon automobiles, and that any one purchasing an automobile for use within the State of Arkansas was required by law to pay such license fee before said automobile may be used within the State; that it is the plain import and intention of the act that the amount of such license fee on the use of automobiles already imposed should be deducted from the amount of the retail sales tax payable under act 233, supra; that the Commissioner of Revenue had promulgated rules and regulations which provide in substance that the seller of an automobile at retail must collect two percentum of the entire purchase price from the purchaser and remit to defendant, and that no deduction would be allowed for the license fee already paid.

Petitioner prayed for a restraining order, and that upon a final hearing a permanent injunction be issued.

Appellant filed a demurrer to the complaint. A temporary restraining order was issued. Other automobile retail dealers filed interventions.

An amendment to the complaint was filed stating that the Senate bill which afterwards became act 233, as originally introduced contained the following, as § 15:

"Section 15. Exemptions. There are hereby specifically exempted from the taxes levied in this act the following:

(a) Sales of gasoline.

(b) Sales of cigars and cigarettes.

(c) Sales of tickets of admission to State, county, district or local fairs, and educational, religious or charitable activities, where the entire amount of such receipts is expended for educational, religious or charitable purposes.

(d) Sales at retail which this State is prohibited from taxing under the Constitution or laws of the United States of America, or under the Constitution of this State.

(e) Sales made by persons who produce livestock, poultry and other products of farm, grove or garden, when said sales are made by the producer, or members of his immediate family, or employees selling such products for the producer, in the original state or condition of preparation at the place of production, and before such products are subjected to any process coming within a class of business."

A motion was made to strike the amendment, which was overruled by the court, and answer was filed denying the allegations of the amended complaint.

The appellee introduced Senator E. B. Dillon, a member of the Fiftieth General Assembly, who testified with reference to holding meetings and what the purpose of the amendment was, and testified at length about the passage of the bill through the Senate. He testified about his understanding of the intention of the Legislature and the intention of the committee in adopting § 15 as it now appears in the act.

The court held that the evidence offered was incompetent, and therefore did not consider it. The court then entered a decree to the effect that the Legislature intended that the amount of license fee paid for the use of an automobile should be deducted from the amount of sales tax collected on the sale of a new automobile, and perpetually enjoined the defendant from enforcing or attempting to enforce collecting or attempting to collect a sales tax on sales of a new automobile without first deducting from the amount of the tax the amount of the license fee paid for the use of said automobile to the State of Arkansas.

The chancery court was correct in holding the evidence introduced by appellee incompetent.

The intention of the Legislature, to which effect must be given, is that expressed in the statute, and the courts will not inquire into the motives which influenced the Legislature or individual members, in voting for its passage, nor indeed as to the intention of the draftsman or of the Legislature so far as it has not been expressed in the act. So in ascertaining the meaning of a statute the court will not be governed or influenced by the views or opinions of any or all of the members of the Legislature, or its legislative committees or any other person. 59 C. J. 1017.

Wherever there is ambiguity in a legislative act, the court will resort to the history of the statute and of the proceedings attending its actual passage through the Legislature as disclosed by the legislative journals. Courts will take judicial notice of and consider the action of the Legislature as shown by the journals. 59 C. J. 1019; Bush v. Martineau, 174 Ark. 214, 295 S.W. 9; Ruddell v. Gray, 171 Ark. 547, 285 S.W. 2.

Appellee's first contention is that, under the plain terms of § 15 of act 233, supra, the sales tax payable on the sale of an automobile is the difference between the license tax paid on said automobile and 2 per cent. of the sale price on said automobile.

Section 15, above quoted, provides: "There are hereby specifically exempted from the taxes levied in this act: (b) A portion of all retail sales on articles and/or commodities on which a State privilege tax or license is already collected."

Appellee argues at length that the license fee paid for the privilege of driving automobiles on the highways is a privilege tax. We agree with appellee in this contention. Numerous authorities are cited to support this argument.

The first case referred to is Ft. Smith v. Scruggs, 70 Ark. 549, 69 S.W. 679. That was a case involving the validity of an ordinance of the city of Fort Smith making it unlawful for any person to keep and use wheeled vehicles without first having obtained a license therefor. The statute authorized cities of the first class to require residents of such city to pay a tax for the privilege of keeping and using wheeled vehicles, etc. It was contended in that case that the tax on the use of an article is a tax on the articles itself. The court said:

"While this may be true of a piano, bedstead or cooking stove, the use of which involves no injury or detriment to the public or its property, as to wheeled vehicles it is different, for they are made to be used upon roads and streets. The streets belong to the public, and are under the control of the Legislature whose province it is to enact laws for their improvement and repair."

The court in that case held outright that the tax imposed by the ordinance was not a property tax, but a privilege tax. It was not a tax on the vehicle, but a tax the owner was required to pay for the use of the vehicle on the streets.

The automobile tax required to be paid by the purchaser of an automobile is paid for the privilege of using the...