Judges: ROBERT T. BENTON, II
Agency: Department of Revenue
Latest Update: Mar. 09, 1978
Summary: Crane was not bought only for rental; therefore, the sales tax applies.
77-1967.PDFSTATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
PAMAR, INC., )
)
Petitioner, )
)
vs. ) CASE NO. 77-1967
)
DEPARTMENT OF REVENUE, )
)
Respondent. )
)
RECOMMENDED ORDER
This matter came on for hearing in Orlando, Florida, before the Division of Administrative Hearings by its duly designated Hearing Officer, Robert T. Benton, II, on January 12, 1978. The parties were represented by counsel:
APPEARANCES
For Petitioner: Mr. Lawrence E. Dolan, Esquire
Byrne and Dolan, P.A. Suite 1335, CNA Building Orlando, Florida 32801
For Respondent: Mr. Cecil L. Davis, Jr., Esquire
Assistant Attorney General The Capitol, Room LL04 Tallahassee, Florida 32304
By revised notice of proposed assessment dated September 30, 1977, respondent alleged that petitioner owed additional taxes under Chapter 212, Florida Statutes (1975). In a petition dated October 13, 1977, petitioner challenged the bulk of the assessment as being predicated on a transaction that petitioner alleged should have been treated as exempt. Petitioner has not called the assessment into question otherwise.
FINDINGS OF FACT
In January of 1976, petitioner purchased a 1969 model American 4450 truck crane at auction in Lake City, Florida. The purchase price was seventy thousand dollars ($70,000.00). Petitioner, a corporation, is one of four related companies involved in construction and in leasing equipment used in construction. Together these companies own approximately eleven cranes of various kinds. Petitioner rents its cranes to the related construction companies and to others; and was, in the business of renting cranes at the time the used truck crane was acquired. It was originally contemplated that Paul A. Prendergast and Associates, one of the related companies, would purchase the truck crane and, on behalf of that firm, Mr. Prendergast certified that the crane was being "purchased for the sole purpose of resale." Petitioner's exhibit No. 5.
The used crane petitioner acquired in January of 1976, was mounted on its own carrier, and was capable of moving from job site to job site under its own power. It has a 40 ton capacity and 80 feet of boom. When petitioner first acquired it, the crane needed reconditioning, which took six months to accomplish. The crane has since been used for lifting, digging and driving piles, but has never been used to haul goods or passengers. In December of 1976, the crane petitioner ordinarily used in its own yard for its own purposes was leased to Industrial Contracting Co. for a job in Atlanta. While this crane was in Atlanta, from the middle of December until the middle of March, petitioner used the truck crane it had acquired at auction for lifting, loading and unloading equipment in its yard. Since its use as a yard crane, the American truck crane has been leased on two occasions.
Petitioner has listed the truck crane on its tangible personal property tax returns and has acquired a license plate for it annually. In order to drive the truck crane over public roads, which petitioner has done, it is necessary to acquire a permit.
CONCLUSIONS OF LAW
Florida levies a tax on the sale of "tangible personal property at retail in this state", Section 212.05, Florida Statutes (1975) "[a]t the rate of
4 percent of the sales price." Section 212.05(1), Florida Statutes (1975). A sale at retail is defined as "a sale . . . for any purpose other than for resale
. . ." Section 212.02(3)(a), Florida Statutes (1975). In this connection, lease or rental as well as an outright sale can constitute a resale. Section 212.02(2)(a), Florida Statues (1975). Petitioner takes the position that no sales tax is owing on account of its purchase of the truck crane, because the crane was purchased for the purpose of being leased.
The record is devoid of any indication of what the seller's intention may have been, as regards the crane's use after the sale. In all likelihood, it was a matter of indifference to the seller, and counsel for petitioner does not argue otherwise. At the time of the sale, Mr. Prendergast certified that, from the buyer's standpoint, the purchase was "for the sole purpose of resale," but he did so on behalf of Paul A. Prendergast & Associates, not on behalf of petitioner. Especially in light of the related companies' practice of leasing equipment to each other, this certification is not inconsistent with an intention that petitioner use the truck crane (as lessee of Paul A. Prendergast & Associates). The very first use to which the crane was put, after reconditioning, was in fact work for petitioner in its yard. Petitioner used the crane regularly for a period of three months or more. Subsequently, up to the time of the hearing, petitioner had leased the crane only twice. In short, the evidence does not support the conclusion that the truck crane was "purchased solely for rental purposes." Rule 12A-1.71(2), F.A.C.
RECOMMENDATION
Upon consideration of the foregoing, it is RECOMMENDED:
That the proposed assessment be upheld.
DONE and ENTERED this 10th day of February, 1978, in Tallahassee, Florida.
ROBERT T. BENTON, II
Hearing Officer
Division of Administrative Hearings
530 Carlton Building Tallahassee, Florida 32304
COPIES FURNISHED:
Mr. Lawrence E. Dolan, Esquire Byrne and Dolan, P.A.
Suite 1335, CNA Building Orlando, Florida 32801
Mr. Cecil L. Davis, Jr., Esquire Assistant Attorney General
The Capitol, Room LL04 Tallahassee, Florida 32304
STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
PAMAR, INC., )
)
Petitioner, )
)
vs. ) CASE NO. 77-1967
)
DEPARTMENT OF REVENUE, )
)
Respondent. )
)
APPENDIX TO RECOMMENDED ORDER
Parts A and B of petitioner's proposed findings of fact have been adopted, in substance, insofar as relevant.
Paragraphs 1 2, 3 of Part C of petitioner's proposed findings of fact have been adopted, in substance, insofar as relevant.
Paragraph 4 of Part C of petitioner's proposed findings of fact has not been adopted. In late 1976 and the early part of 1977, petitioner was using the crane for its own purposes, which may account for petitioner's failure to rent it.
Paragraph 5 of Part C of petitioner's proposed findings of fact has been rejected as unsupported by the evidence.
Paragraphs 6, 7, 8 and 9 of Part C of petitioner's proposed findings of fact have been adopted, in substance, insofar as relevant except that the truck crane was used by petitioner in its yard beginning in December of 1976.
Docket for Case No: 77-001967
Orders for Case No: 77-001967
