STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

STATE OF FLORIDA, DEPARTMENT ) OF REVENUE, )

)

Petitioner, )

)

vs. ) CASE NO. 95-1536

) FRANCES BOWERS, a/k/a FRANCIS ) BOWERS, d/b/a SHANNON OIL ) COMPANY and SHANNON SERVICE ) STATION, )

)

Respondent. )

) STATE OF FLORIDA, DEPARTMENT ) OF REVENUE, )

)

Petitioner, )

)

vs. ) CASE NO. 95-1559

) FRANCES BOWERS, a/k/a FRANCIS ) BOWERS, d/b/a SHANNON OIL ) COMPANY and SHANNON SERVICE ) STATION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to Notice, a formal hearing was held in this case before Larry J. Sartin, a duly designated Administrative Law Judge of the Division of Administrative Hearings, on January 17, 1997, in Tallahassee, Florida.

APPEARANCES

For Petitioner: Albert J. Wollermann

John N. Upchurch

Assistant Attorneys General Office of the Attorney General The Capitol - Tax Section Tallahassee, Florida 32399-1050

For Respondent: Own N. Powell, Esquire

Post Office Box 789 Bonifay, Florida 32425

STATEMENT OF THE ISSUES

The issues in these cases are (1) whether four tax warrants issued by Petitioner against Respondent, Frances Bowers, a/k/a Francis Bowers, d/b/a Shannon Oil Company and Shannon Service Stations, were properly issued; (2) whether two Notices of Freeze and two Notices of Intent to Levy on Respondent were properly issued; (3) whether the allegations of an Administrative Complaint entered March 1, 1995 by Petitioner against Respondent are correct; and (4) whether an Emergency Order of Suspension issued by Petitioner on or about March 3, 1995 was warranted.

PRELIMINARY STATEMENT

On or about February 28, 1995, Petitioner, the State of Florida, Department of Revenue, issued two Notices of Freeze and two Notices of Intent to Levy on Respondent, Frances Bowers, a/k/a Francis Bowers, d/b/a Shannon Oil Company and Shannon Service Stations. Pursuant to the Notices, Petitioner notified Respondent that it intended to levy on credits or personal property belonging to Respondent,

consisting of deposits at the Bank of Bonifay. Petitioner indicated that it was taking this action for nonpayment of taxes, penalty and interest in the sum of $183,548.97 attributable to Shannon Oil Company and in the sum of

$187,267.18 attributable to Shannon Service Stations.

On or about March 20, 1995, Respondent filed a Request for Administrative Hearing with Petitioner. Respondent contested the proposed levy and alleged that Respondent had not failed to pay any taxes owed.

On or about March 1, 1995, Petitioner issued an Administrative Complaint against Respondent. Pursuant to the Administrative Complaint, Petitioner informed Respondent that certain licenses held by Respondent were being revoked. This action was premised upon allegations that Respondent “failed to file or pay fuel taxes collected for the period of July, 1993 through December, 1994”.

Petitioner also issued an Emergency Order of Suspension on or about March 3, 1995. Pursuant to this Order, Petitioner suspended the licenses held by Respondent which Petitioner seeks to revoke in the Administrative Complaint.

On or about March 22, 1995, Respondent sent a Petition for Administrative hearing to Petitioner. Respondent disputed in the Petition whether she had failed to remit outstanding taxes or that she owed such taxes as alleged in the Administrative Complaint.

The March 20, 1995 Request for Administrative Hearing and the March 22, 1995 Petition for Administrative Hearing were filed with the Division of Administrative Hearings on March 30, 1995. The March 22, 1995 Petition was designated case number 95-1536 and the March 20, 1995 Request was designated case number 95-1559. Both cases were assigned to the undersigned.

The formal hearing of these cases was originally scheduled for August 2, 1995. Several continuances were granted to give the parties time to prepare for the formal hearing. Pursuant to a Fifth Notice of Hearing, the formal hearing was scheduled for January 17, 1997.

At the commencement of the formal hearing, Respondent stipulated to the revocation of the licenses sought by Petitioner pursuant to the Administrative Complaint and the Emergency Suspension Order at issue in case number 95-1536. Respondent also stipulated to the Notices of Freeze and Notice of Levy issued by Petitioner in case number 95-1559. Respondent contended, however, that no tax was owed.

Respondent also stipulated to certain facts and the admissibility of certain exhibits offered by Petitioner. The stipulated facts have been accepted, to the extent relevant and necessary, in this Recommended Order. The exhibits were marked as Department’s exhibits 1 through 14 and were accepted into evidence. Respondent, Frances Bowers, a/k/a

Francis Bowers, d/b/a Shannon Oil Company and Shannon Service Stations Department’s 14 is the deposition testimony of Frances Bowers.

No transcript of the hearing was filed. Proposed orders were filed by both parties.

FINDINGS OF FACT

1. At all times relevant to this proceeding, Respondent, Frances Bowers, a/k/a Francis Bowers, held a Special Fuel Dealers License #10-011382, a Motor Fuel Jobbers License #09-001450 and Retail Dealer License #’s 77- 000320 and 40-001175.

2. The motor fuel and special fuel licenses were held at Highway 90 East, Caryville, Florida 32427. The retail dealer licenses were held at 1007 North Waukesh Street, Bonifay, Florida 32425 and Highway 279 South, Caryville, Florida 32427.

3. Ms. Bowers operated under the business names of Shannon Oil Company or Shannon Service Station.

4. Ms. Bowers has been engaged in the sale of fuel at various retail locations since 1986. She has engaged in the sale of special fuels (diesel) since May 10, 1985. She has operated as a motor fuel jobber (gasoline) since January 18, 1989.

5. From April 1994 through December 1994, Ms. Bowers purchased special fuel from Murphy Oil Co.

6. From May 1994 through July 1994, Ms. Bowers purchased special fuel from Beards Oil Co.

7. For the period July 1993 through December 1994 Ms. Bowers delivered unsigned, no-remit tax returns to Petitioner, the Department of Revenue (hereinafter referred

   to as the “Department”). Those returns were delivered by Ms. Bowers to Kathy Jones, a Department Revenue Specialist, at the Department’s Marianna offices. Returns for some months were not remitted.

8. Ms. Bowers subsequently returned to the Department’s Marianna offices and signed the no-remit returns she had filed in the presence of Ms. Jones.

9. The no-remit returns filed by Ms. Bowers indicate that she owed taxes pursuant to Chapters 206, 212, Part II and 336, Florida Statutes. No part of the tax Ms. Bowers indicated was owed was remitted by Ms. Bowers to the Department.

10. For months for which no return was filed, the Department estimated the amount of tax owed.

11. The Department issued Notices of Assessment and Jeopardy Finding to Ms. Bowers in January 1995. These Notices informed Ms. Bowers of the Department’s intent to cause tax warrants for the outstanding taxes owed by Ms. Bowers to be filed with the Clerk of Court.

12. Based upon the no-remit returns, the Department filed four tax warrants. The warrants were for total taxes of $218,801,56. Additionally, penalties, filing fees and interest was included in the tax warrants. The total amount for the four warrants, without the filing fees, was

    $187,167.18 attributable to Shannon Service Stations and

    
    

    $183,548.97 attributable to Shannon Oil Company.

    
    

13. Included in the no-remit returns filed by Ms. Bowers were Special and Alternative Fuel Tax Returns. These returns indicated that Ms. Bowers had purchased “tax-paid” special fuel, meaning that she had paid the tax at the time she purchased the fuel. The tax was allegedly paid to Murphy Oil Co. or Beard’s Oil Co.

14. Based upon the Special Fuel Tax Returns of Murphy Oil Co. and Beard’s Oil Co. no tax was paid by Ms. Bowers on purchases of special fuel purchased by Ms. Bowers. Copies of these returns were accepted into evidence without objection from Ms. Bowers.

15. Ms. Bowers has admitted during her deposition testimony that she owes the outstanding taxes at issue in this proceeding. See Department’s exhibit 14.

16. On or about February 28, 1995, the Department issued two Notices of Freeze and two Notices of Intent to Levy on Frances Bowers, a/k/a Francis Bowers, d/b/a Shannon Oil Company and Shannon Service Stations. Pursuant to the Notices, the Department notified Ms. Bowers that it intended to levy against her assets, consisting of deposits at the Bank of Bonifay, for outstanding taxes. The Department indicated that it was taking this action for nonpayment of taxes, penalty and interest in the sum of $183,548.97

    attributable to Shannon Oil Company and in the sum of

    
    

    $187,267.18 attributable to Shannon Service Stations.

    
    

17. On or about March 20, 1995, Ms. Bowers filed a Request for Administrative Hearing with the Department. Ms. Bowers contested the proposed levy and alleged that she had not failed to pay any taxes owed.

18. On or about March 1, 1995, the Department issued an Administrative Complaint against Ms. Bowers. Pursuant to the Administrative Complaint, the Department informed Ms. Bowers that Special Fuel Dealers License #10-011382, Motor Fuel Jobbers License #09-001450 and Retail Dealer License #’s 77-000320 and 40-001175 were being revoked. This action was premised upon allegations that Ms. Bowers “failed to file or pay fuel taxes collected for the period of July, 1993 through December, 1994”.

19. The Department also issued an Emergency Order of Suspension on or about March 3, 1995. Pursuant to this Order, the Department suspended the licenses held by Ms. Bowers which the Department sought to revoke in the Administrative Complaint.

20. On or about March 22, 1995, Ms. Bowers sent a Petition for Administrative hearing to the Department in response tot he Administrative Complaint. Ms. Bowers disputed in the Petition whether she had failed to remit

    outstanding taxes or that she owed such taxes as alleged in the Administrative Complaint.

21. All of the exhibits and the facts of this matter were stipulated to by Ms. Bowers. Ms. Bowers also stipulated to the revocation of her licenses, the emergency suspension order issued by the Department, the issuance of the tax warrants and the Notices of Freeze and Notices of Intent to Levy.

    CONCLUSIONS OF LAW

    
    

22. The Division of Administrative Hearings has jurisdiction of the parties to, and the subject matter of, this proceeding. Section 120,57, Florida Statutes.

23. Florida sales tax is imposed upon the sale at retail in Florida of motor fuel. Sections 212.05 and 212.62(1), Florida Statutes.

24. Chapter 206, Florida Statutes, also imposes motor and other fuel taxes on sales of motor and other fuels in Florida. Pursuant to Section 206.404, Florida Statutes, the tax is imposed on all retail dealers in Florida. Retail dealers of motor and other fuels are required to remit the tax imposed by Chapter 206, Florida Statutes.

25. Local option taxes are imposed pursuant to Chapter 336, Florida Statutes, on sales of fuel in the County in which Ms. Bowers operated.

26. In order to sell motor and other fuels in Florida, at wholesale or retail, a seller must obtain licenses from the Department. See Rule 12B-5.005, Florida Administrative Code. Those licenses may be revoked by the Department if a licensee fails to pay required gas taxes. See Section

    206.055 (1), Florida Statutes. See also, Sections 336.025 and 336.026, Florida Statutes.

27. Persons selling fuel are required to file monthly returns indicating the number of gallons of fuel purchased

    and sold for the preceding month. They are also required to remit taxes levied under Sections 206.43(1), 206.91, 336.021(2)9a), 336.026(2)(a), Florida Statutes. See Rule 12B-5.007(3)(a), Florida Administrative Code.

28. Ms. Bowers sold fuel during the period July 1993 through December 1994. She filed tax returns for most months during this period indicating taxes due.

29. Ms. Bowers admittedly was engaged in the sale of fuel subject to tax pursuant to Chapter 206, 212 and 336, Florida Statutes.

30. Ms. Bowers admittedly failed to pay taxes she represented were owed for the period at issue.

31. Tax warrants for the amount of unpaid taxes have been properly issued.

32. Notices of Freeze and Notices of Intent to Levy were filed by the Department pursuant to Section 213.67, Florida Statutes, and Rule 12-21, Florida Administrative Code, in the amounts of $183,548.97 and $187,167.18.

33. The Department issued its Emergency Order of Suspension pursuant to Sections 206.055 and 120.60(8), Florida Statutes.

34. Ms. Bowers has stipulated to the emergency suspension of her licenses.

35. Ms. Bowers has also stipulated to the revocation of her licenses.

36. Ms. Bowers also stipulated to the Notices of Freeze and the Notices of Intent to Levy.

37. The Department has met its burden of proof in this matter with regard to the amount of tax owed by Ms. Bowers. Ms. Bowers offered no proof to rebut the Department’s evidence.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is

RECOMMENDED that a Final Order be entered upholding the Emergency Order of Suspension, the Department’s Administrative Complaint, the four tax warrants issued by the Department against Respondent and the Notices of Intent to Freeze and Notices of Intent to Levy.

DONE and ORDERED this 25th day of February 1997, in Tallahassee, Florida.

LARRY J. SARTIN

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

488-9675 SUNCOM 278-9675

Fax Filing (904) 921-6847

Filed with the Clerk of the Division of Administrative Hearings this 25th day of February 1997.

COPIES FURNISHED:

Larry Fuchs Executive Director

Department of Revenue

104 Carlton Building Tallahassee, Florida 32399-0100

Linda Lettera General Counsel

Department of Revenue

204 Carlton Building Tallahassee, Florida 32399

Albert J. Wollermann John N. Upchurch

Assistant Attorneys General Office of the Attorney General The Capitol - Tax Section Tallahassee, Florida 32399-1050

Owen N. Powell, Esquire Post Office Box 789 Bonifay, Florida 32425

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within 15 days from the date of this recommended order. Any exceptions to this recommended order should be filed with the agency that will issue the final order in this case.

Docket for Case No: 95-001536

Orders for Case No: 95-001536