Citibank (South Dakota), N.A. v. Graham
315 Ga. App. 120
| Ga. Ct. App. | 2012Background
- Citibank funds private label credit card programs for retailers; retailers disavow ownership of the accounts.
- When debt becomes uncollectible, the bad debt includes amounts used to pay Georgia sales tax.
- Citibank sought a bad debt deduction for GA taxes and refunds for GA sales tax paid, under OCGA § 48-8-45 and § 48-2-35; Department denied.
- Trial court dismissed Citibank's complaint; Citibank appealed to this Court.
- Statutory interpretation issue: whether the Bad Debt Statute permits a refund of sales tax or merely a deduction.
- Statutory and sovereign-immunity analysis: General Refund Statute and common-law refund claims reviewed; court affirms dismissal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Bad Debt Statute allows a refund of sales tax | Citibank argues § 48-8-45(c) provides a refund on the same basis as bad debt deductions for income tax. | G.A. contends the statute only provides a deduction, not a refund, and cannot be expanded by court. | Only a deduction, no refund available. |
| Whether General Refund Statute allows a refund to Citibank | Citibank seeks a refund as a taxpayer for taxes advanced to pay merchants' sales tax. | Citibank is not the taxpayer obligated to remit/pay the tax; refunds require the actual taxpayer. | Citibank is not entitled to refund under § 48-2-35. |
| Whether Citibank can pursue a common law refund claim | Citibank relies on Hawes and common-law theory of money had and received. | Waiver of sovereign immunity via the refund statute governs; no standalone common-law refund right. | No independent common-law tax refund; claim barred. |
Key Cases Cited
- Fidelity and Deposit Co. of Maryland v. Lafarge Bldg. Materials, 312 Ga.App. 821 (2011) (follow literal statute unless absurdity; cannot expand statutory text)
- Clark v. Rush, 312 Ga.App. 333 (2011) (when statute is clear, give plain meaning)
- Opensided MRI of Atlanta v. Chandler, 287 Ga. 406 (2010) (clear, unambiguous language governs interpretation)
- Deutsche Bank Nat. Trust Co. v. JP Morgan Chase Bank, 307 Ga.App. 307 (2010) (distinguishes deductions, credits, and refunds; legislative choice matters)
- General Motors Acceptance Corp. v. Jackson, 247 Ga.App. 141 (2000) (interpretation of bad debt provisions and statutory context)
- Sawnee Elec. Membership Corp. v. Ga. Dept. of Revenue, 279 Ga. 22 (2005) (refund claims governed by General Refund Statute; taxpayer burden)
- James B. Beam Distilling Co. v. State, 263 Ga. 609 (1993) (tax refund statutes require statutory authority)
- Georgia Emission Testing Co. v. Jackson, 259 Ga.App. 250 (2003) (sovereign immunity and statutory waivers; limits on refunds)
- Hawes v. Smith, 120 Ga.App. 158 (1969) (common-law theory discussed in the refund context, but statute-specific)
- Barnes v. City of Atlanta, 275 Ga.App. 385 (2005) (even if refund right exists, must follow applicable statute)
- Barnes v. City of Atlanta, 281 Ga. 256 (2006) (reaffirms statutory limits on relief)