RANDOLPH, Justice, for the Court:
¶ 1. In 1993, AT & T Corporation
¶ 2. After unsuccessful administrative appeals before the Commission, AT & T filed a "Petition for Appeal of Additional Income Tax Assessment Ordered by State Tax Commission, For Declaratory and Injunctive Relief, and For Refund of Overpayment of Tax" ("Petition") in the Chancery Court of Hinds County, Mississippi. The Petition challenged the constitutionality of several tax statutes under the Commerce Clause of the United States Constitution and sought associated relief. See U.S. Const. art. I, § 8, cl. 3. But AT & T's Petition was not "accompanied with a bond, to be approved by the clerk ..., in a sum double the amount in controversy[,]" as then required by Mississippi Code Section 27-7-73. See Miss.Code Ann. § 27-7-73 (repealed by Laws of 2005, ch. 499, § 36, effective July 1, 2005). Rather, AT & T paid the Assessment,
¶ 3. Preliminarily, the chancery court found that AT & T had "properly appealed" the full Commission's "Order." The chancery court then held that the subject tax statutes violated the Commerce Clause; that the "offensive limitations" were to be struck so that AT & T was granted the "tax benefits" enjoyed by other taxpayers; and, based thereon, that AT & T was entitled to an award of $12,727,174. Thereafter, the Commission appealed those rulings, while AT & T appealed only the chancery court's interest calculations.
¶ 4. From 1993 to 1996, AT & T filed affiliated group, Mississippi income tax returns with the Commission. In 1993, AT & T filed its return using the "combined method" of reporting then authorized by Mississippi Code Section 27-7-37(2)(a)(ii).
¶ 5. In 1997, the Commission commenced an audit of AT & T's Mississippi income tax returns for the 1993-1996 tax years. During the audit, the Commission, inter alia, (1) changed the method used by AT & T from 1994 to 1996 to the "combined method" provided under Section 27-7-37(2)(a)(ii), and (2) included in net Mississippi business income all intercompany dividends received from distributing corporations which were not doing business in Mississippi or were not subject to taxation in Mississippi in the year of distribution, pursuant to the Commission's interpretation and application of Mississippi Code Section 27-7-15(4)(i).
¶ 6. Following AT & T's administrative appeals before the Commission's Board of
¶ 7. Yet, instead of filing a bond "approved by the clerk" and "in a sum double the amount in controversy[,]" as then required by Section 27-7-73 (and provided in the full Commission's "Order"), AT & T chose to pay the Assessment "under protest," and then separately filed its Petition in the chancery court. Id. According to the Petition, the chancery court had jurisdiction, and venue was proper, pursuant to Mississippi Code Sections 11-13-11 and 27-7-73.
¶ 8. The parties and the chancery court subsequently agreed to bifurcate the matter into two stages — the First Stage to address the constitutionality of the subject tax statutes and, if constitutionally deficient, their application to AT & T; the Second Stage (if necessary) to address the resulting Mississippi income tax computations for AT & T. The parties then submitted extensive stipulations of fact and voluminous exhibits admitted by joint stipulation to the chancery court.
¶ 9. Following the First Stage trial, the June 12, 2006, "Opinion and Order" of the chancery court provided that it had "jurisdiction over the review of the findings of [the Commission] in this matter and venue is proper pursuant to" Section 27-7-73. (Emphasis added.) The chancery court then concluded that Sections 27-7-37(2)(a)(i) and 27-7-15(4)(i) both violated the Commerce Clause. As such, the chancery court reversed the full Commission's "Order" as "arbitrary and capricious...." Regarding AT & T's remedy, the chancery court struck the "offensive limitations" and granted AT & T the "tax benefits" which were "enjoyed" by other taxpayers. The chancery court further instructed the parties that, for the Second Stage, they were to prepare "appropriate filings concerning the appropriate Mississippi tax computations for AT & T for the [subject] tax years utilizing the tax benefits afforded by this [c]ourt's decision."
¶ 10. Following the Second Stage trial and post-trial filings, the chancery court entered its November 16, 2010, "Opinion and Order." Regarding jurisdiction, the chancery court held that:
(Emphasis added.) The chancery court then concluded that AT & T was entitled to an award of $12,727,174, "as of and through November 30, 2010...."
¶ 11. Thereafter, the Commission filed its "Notice of Appeal" regarding the "Opinions and Orders" of June 12, 2006, and November 16, 2010, while AT & T filed its "Notice of Appeal" only as to the interest calculations in the November 16, 2010, "Opinion and Order."
¶ 12. On appeal, this Court restates the general issues raised by the parties, as follows:
However, we find the lack of jurisdiction is case-dispositive. The chancery court lacked appellate jurisdiction over an administrative-agency appeal which is not in full compliance with statutory requirements.
¶ 13. This Court has previously stated that:
Drummond v. State, 184 Miss. 738, 185 So. 207, 209 (1938) (quoting Morris v. Gilmer, 129 U.S. 315, 325, 9 S.Ct. 289, 292, 32 L.Ed. 690, 694 (1889)). See also Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 95, 118 S.Ct. 1003, 1013, 140 L.Ed.2d 210 (1998) (quoting Arizonans for Official English v. Arizona, 520 U.S. 43, 73, 117 S.Ct. 1055, 1071-72, 137 L.Ed.2d 170 (1997)) ("[E]very federal appellate court has a special obligation to `satisfy itself not only of its own jurisdiction, but also that of the lower courts in a cause under review,' even though the parties are prepared to concede it."); Home Ins. Co. v. Watts, 229 Miss. 735, 753, 93 So.2d 848, 850 (1957) ("the question of jurisdiction may be raised at any stage of the proceedings, and even by the Court of its own motion."). Jurisdiction "is a question of law ... subject to de novo review by this Court." Re/Max Real Estate Partners, Inc. v. Lindsley, 840 So.2d 709, 711 (Miss. 2003) (citing Burch v. Land Partners, L.P., 784 So.2d 925, 927 (Miss.2001)).
¶ 14. AT & T elected to proceed in the chancery court under Sections 11-13-11 and 27-7-73. In the First Stage, the chancery court found that it had "jurisdiction
¶ 15. AT & T contends that Sections 11-13-11 and 27-7-73 provided the chancery court "with clear jurisdiction to declare the [c]ontested [s]tatutes unconstitutional and to fashion the appropriate equitable remedy." Additionally, AT & T contends that, beyond the "specific grants of jurisdiction" in Sections 11-13-11 and 27-7-73, the chancery court "had the broad general powers vested in a court of equity." Finally, AT & T maintains that the "constitutional violations could not have been remedied by refund proceedings, because the [Commission] lacks the power to declare statutes unconstitutional and therefore would never have ordered a refund."
¶ 16. In cases involving the "payment of an unlawful tax[,]" the State "must provide procedural safeguards against unlawful exactions in order to satisfy the commands of the Due Process Clause." McKesson Corp. v. Div. of Alcoholic Beverages and Tobacco, 496 U.S. 18, 36, 110 S.Ct. 2238, 2250, 110 L.Ed.2d 17 (1990). See also Marx v. Broom, 632 So.2d 1315, 1319-20 (Miss.1994) (quoting Brinkerhoff-Faris Trust & Sav. Co. v. Hill, 281 U.S. 673, 682, 50 S.Ct. 451, 454-55, 74 L.Ed. 1107 (1930)) ("[w]hether acting through its judiciary or its Legislature, a state may not deprive a person of all existing remedies for the enforcement of a right, which the state has not power to destroy, unless there is, or was, afforded to him some real opportunity to protect it."). One "procedural safeguard" is "to provide a form of `predeprivation process,' for example, by authorizing taxpayers to bring suit to enjoin imposition of a tax prior to its payment, or by allowing taxpayers to withhold payment and then interpose their objections as defenses in a tax enforcement proceeding initiated by the State." McKesson Corp., 496 U.S. at 36-37, 110 S.Ct. 2238 (emphasis added). Another "procedural safeguard" is to permit "a postdeprivation refund action." Id. at 36, 39, 110 S.Ct. 2238. Under any option, "States may avail themselves of a variety of procedural protections against any disruptive effects of a tax scheme's invalidation, such as providing by statute that refunds will be available only to those taxpayers paying under protest, or enforcing relatively short statutes of limitation applicable to refund actions." Id. at 50, 110 S.Ct. 2238 (emphasis added).
¶ 17. Section 11-13-11 states that "[t]he chancery court shall have jurisdiction of suits by one or more taxpayers ... to restrain the collection of any taxes levied or attempted to be collected without
¶ 18. This Court concludes that AT & T's failure to avail itself of the "predeprivation process" made available in Section 11-13-11 renders that statute inapplicable in the case sub judice. McKesson Corp., 496 U.S. at 36-37, 110 S.Ct. 2238. Under Section 11-13-11, AT & T could have instituted a predeprivation taxpayer suit in the chancery court challenging the lawfulness of tax "collection" via a Commerce Clause challenge to Sections 27-7-37(2)(a)(i) and/or 27-7-15(4)(i). Miss.Code Ann. § 11-13-11 (Rev.2004). But AT & T did not, and instead paid the subject Mississippi income taxes and the Assessment. In McKesson Corp., the United States Supreme Court stated that:
McKesson Corp., 496 U.S. at 38 n. 21, 110 S.Ct. 2238 (emphasis added). By "fail[ing] to avail" itself of the "adequate remedy at law" provided in the "predeprivation process" of Section 11-13-11, and instead rendering "voluntary" payments of both the subject Mississippi income taxes and the Assessment, this Court concludes that AT & T "cannot [now] complain...." Id. at 36-38 n. 21, 110 S.Ct. 2238; Davis v. Barr, 250 Miss. 54, 62, 157 So.2d 505, 507 (1963) (quoting 2 Am.Jur.2d, Administrative Law, § 596, p. 429). Because of AT & T's failure to timely invoke the statute, Section 11-13-11 is not a proper basis for the chancery court's jurisdiction in this case.
¶ 19. During the subject tax years, Section 27-7-73 provided, in pertinent part, that:
Miss.Code Ann. § 27-7-73 (1993) (emphasis added). The full Commission's "Order" was consistent with the above-quoted statute and expressly provided that AT & T "shall" pay the Assessment "within thirty (30) days from the receipt of this order
¶ 20. Preliminarily, although the Commission conceded that the chancery court had jurisdiction under Section 27-7-73 to "review the findings of the [Commission] in this matter[,]" jurisprudential logic dictates that jurisdiction cannot be conferred on the chancery court by agreement, consent, or stipulation. See Steel Co., 523 U.S. at 95, 118 S.Ct. 1003 (quoting Arizonans for Official English, 520 U.S. at 73, 117 S.Ct. 1055) ("[E]very federal appellate court has a special obligation to `satisfy itself not only of its own jurisdiction, but also that of the lower courts in a cause under review,' even though the parties are prepared to concede it."); Donald v. Reeves Transport Co., 538 So.2d 1191, 1194 (Miss.1989) (jurisdiction cannot "be conferred on this Court by stipulation of the parties."); Mississippi State Tax Comm'n v. Mississippi-Alabama State Fair, 222 So.2d 664, 666-67 (Miss.1969) ("Can the administrative agency, the Tax Commission, and a taxpayer, in a hearing before the Commission, ... by an agreement confer jurisdiction upon the circuit court to retry, de novo, the issue of the assessment and collection of taxes required to be determined by the Tax Commission? The answer to that query is, of course, in the
¶ 21. As the stipulation regarding Section 27-7-73 was ineffectual, the question becomes whether AT & T's actions
¶ 22. In Khurana, the taxpayer "filed his petition appealing the assessments to the ... [c]hancery [c]ourt; however, he did not pay the taxes or post a bond at the time he filed the petition, as required by statute."
Id. (emphasis in original).
¶ 23. In 5K Farms, the taxpayer filed a petition in the chancery court without paying the tax assessment or posting a bond as required under the 2005 version of Section 27-77-7.
Id. at 228-29 (emphasis added). Based thereon, this Court held that "[t]he pretrial bond requirement derived from ... [Section] 27-77-7 (Rev.2005) is a requirement governing appellate jurisdiction...." Id. According to this Court:
Id.
¶ 24. Like Khurana and 5K Farms, the case sub judice "involves an appeal from an administrative-agency decision to the trial court, sitting as an appellate court." 5K Farms, 94 So.3d at 227-28. Under the version of Section 27-7-73 that was then current, AT & T's Petition was required
¶ 25. This Court agrees with AT & T that Sections 11-13-11 and 27-7-73 provide the chancery court with subject-matter jurisdiction to "declare the [c]ontested statutes unconstitutional and to fashion the appropriate equitable remedy." But AT & T patently failed to abide by the prerequisite statutory mechanisms provided in both statutes for making such a challenge (i.e., by paying the Mississippi income taxes and Assessment, there were no taxes for the chancery court "to restrain the collection of" under Section 11-13-11; by failing to accompany the Petition with a bond "approved by the clerk" and "double the amount in controversy," the Commission's "findings" became "final" under Section 27-7-73). Miss.Code Ann. §§ 11-13-11 (Rev.2004), 27-7-73 (1993). Instead, from the outset of this matter, AT & T consistently chose to act by its own rules, regardless of whether statutorily outlined procedures were contravened. For instance, in tax years 1994 to 1996, AT & T did not formally contest the subject tax statutes, but rather filed under the statutorily unavailable "consolidated method" without making that decision facially clear (i.e., the returns were styled "nexus combined income"). AT & T paid the taxes due following utilization of its own reporting method. Then, even after the audit and Assessment, AT & T chose voluntarily to pay the Assessment "under protest," instead of filing suit in chancery court seeking to "restrain ... collection...." Miss.Code Ann. § 11-13-11 (Rev.2004). Finally, AT & T's Petition was not accompanied with a bond "approved by the clerk" and "double the amount in controversy...." Miss.Code Ann. § 27-7-73 (1993). Without AT & T's adherence to the "procedural protections" established by the Legislature, those statutes were not a proper basis for jurisdiction in the case sub judice. McKesson Corp., 496 U.S. at 50, 110 S.Ct. 2238. Furthermore, as AT & T failed to utilize such "adequate remed[ies] at law[,]" equity jurisdiction is inapplicable. Davis, 157 So.2d at 507 (quoting 2 Am.Jur.2d, Administrative Law, § 596, p. 429).
¶ 26. "Without jurisdiction the court cannot proceed at all in any cause. Jurisdiction is power to declare the law, and when it ceases to exist, the only function remaining to the court is that of announcing the fact and dismissing the cause." Steel Co., 523 U.S. at 94, 118 S.Ct. 1003 (quoting Ex parte McCardle, 7 Wall. 506, 514, 19 L.Ed. 264 (1868)). Based upon the above analysis, "[b]ecause the chancery court should not have reached the merits of the case, the chancery court's order[s] ... [are] vacated. The order of the Commission remains in effect." Khurana, 85 So.3d at 855.
¶ 27.
WALLER, C.J., CARLSON AND DICKINSON, P.JJ., LAMAR, KITCHENS, CHANDLER, PIERCE AND KING, JJ., CONCUR.
Miss.Code Ann. § 27-7-37 (1993) (emphasis added). In 2004, Section 27-7-37 was amended to delete subsection (2)(a)(i). But because that amendment was not retroactive, it is inapplicable to the present appeal. Therefore, unless indicated otherwise, all references to Section 27-7-37 refer to the version in effect during the tax years at issue.
Miss.Code Ann. § 27-7-15(4)(i) (Rev.2010) (emphasis added).
In 2005, the Legislature enacted Mississippi Code Section 27-77-7(1) which provided, in pertinent part, that "the taxpayer shall within thirty (30) days from the date of the [Commission] order, file a petition in the chancery court appealing the order and pay the tax or post the bond as required in this chapter." Miss.Code Ann. § 27-77-7(1) (2005) (emphasis added). The "bond" referenced in Section 27-77-7(1) was to be "a surety bond approved by the clerk of the court in a sum double the amount in controversy ...." Miss. Code Ann. § 27-77-7(3) (2005) (emphasis added).
In 2010, the Legislature amended Section 27-77-7(3) to provide that the "bond" referenced in Section 27-77-7(1) shall be "a surety bond approved by the clerk of the court in a sum half the amount in controversy ...." Miss.Code Ann. § 27-77-7(3) (Rev.2010) (emphasis added). Additionally, the chancellor now "retains jurisdiction, after motion, notice and hearing, to reduce the amount of the bond." Id.