*1
St. Lоuis County and its substantially ad-
proposed for annexation for city services.
vanced, highly urbanized development —a
fact even more apparent now than at the
Id. at 644.
time of the Graeler
(1960
cases
foregoing
from Liberty stands as
That makes the impact of those two cases
gleaming cоntradistinction between the sit-
with the other law recited in this dissent
uation in this ease in
Louis County
St.
increasingly appropriate at this time.
annexations elsewhere.
In Liberty,
city
Town
Country
directs our attention
growing
was
and developing.
It needed to
to Mayor, Councilmen and Citizens of the
control the adjoining unsophisticated terri-
City
Liberty
Beard,
future development in the adjoining unin-
corporated area. As stated court:
Plaintiff City argues that the evidence
shows the annexation was proposed be-
cause it was believed the City officials
and their professional consultants that the entire area beginning to urban- ize; that once begins urbanization on the CLUB, ST. LOUIS COUNTRY et doorstep city, continues, of a it not only al., Appellants, accelerates, but making it essential for City to control that urbanization and * * * ADMINISTRATIVE HEARING COM development. addition, the area MISSOURI, OF et MISSION itself is attractive existing City * * * al., Respondents. and its services. Since begun urbanization has in the No. area, entire expected since it can be Missouri, Supreme Court of to continue and accelerate because- the En Banc. urbanization, area lends itself to ex- pert witnesses testified that it should be 20, 1983. Sept. annexed the City. The evidence was based on the experts’ testimony that
county government cannot with the cope
sophisticated control of devel- type urban
opment. As development more and more area,
occurs in this there will be an in-
creasing need in the area people *2 Jr., Keller, Karzon, T. St.
Juan D. David Louis, appellants. for Ashcroft, Gen., Daugher- Jay Atty.
John Gen., Wieler, Attys. L. Asst. ty, Richard for City, respondents. Jefferson BLACKMAR, Judge. Ad- to review the brought action determi- Hearing Commission’s
ministrative clubs, are which private country nаtion that pay must open general public, not when charged on fees to members sales tax certain club fa- guests enjoy bring the case involves construc- cilities. Because laws, has tion of the revenue Court V, to Mo. Const. Art. jurisdiction pursuant 3. conclude that the assessment We with the law. was in acсordance tax and Algonquin Club Country St. Louis not-for-profit are Missouri Country Club their members corporations provide tennis, and clubhouse swimming, with golf, exempt from both The clubs are facilities. state income taxes federal Revenue the Internal Code 501(c)(7) of of state law. parallel provisions regularly Cоuntry budget Club’s St. Louis deficit, spe- Algonquin imposes shows a at the end on members cial assessments up any deficit. year in order to make semi-private public In contrast Country clubs, Algonquin Louis and St. Clubs, clubs, not reve- do derive private to members charged nue fees from restrict non- severely general public, Non-mem- of club facilities. usage only as the facilities allowed use bers are members, mem- accompanied by guests use of their later for bers are billed prohibit- clubs are facilities. Both club collecting fees from bylaws ed non-members, and any charges from other Country Club cash. Louis do handle inviting particu- prohibits a member from year. times per two lar more than intro- restrict typically clubs private Other occa- four individual duction of per year. sions The clubs did report sales taxes on to a in a partner public accounting enue 1, period for the April Louis, not the stating firm St. that it was through January tax Depart- policy Department to assess sales ment Revenue an issued assessment of on transactions such as are involved here. unpaid sales tax We held in Blue against Country $2,207.76, Club for golf fees for *3 tennis, law, against by the incidence of taxes is determined Algonquin Country $2,723.29,
Club for that fees, the Director of Rеvenue and his golf on a finding power vary based that the subordinates have no to fees were of All charges employees taxable admission force a statute. that these under 144.020.- 1(2), do RSMo 1978. can is to state the current policy Department. They cannot bind future Di- appeal On to the Administrative Hеaring rectors, or right limit the state’s collect by Commission the action the Department Bartlett properly owing. taxes See also of Revenue was upheld. St. Louis and Al- of Reve- Company, Grain Director gonquin Country appeal Clubs the Adminis- nue, (Mo.1983). 220 There S.W.2d trative Hearing ruling. Commission’s We be a which a might conceivably case in affirm. taxpayer sought ruling a as to the tax The Validity of the Assessments transaction, and particular incidents of a that, taxpayers The assert without re- on or ruling deciding relied spect merits, the assessments are transaction, to enter but there into the procedurally reject dеfective. We each of nothing that that absolutely is indicates arguments the three presented. anything taxpayers these would have done 1974 let- different if had not had the It is first claimed that the assess letter, furthermore, not a ter. This ments are invalid because they were not formal ruling contemplated by CSR mаde personally by the Director of Reve rules, 10-3.003 and because predecessor its nue, but signed were Ruth by The taxpayer. it was not addressed Schneider, an of the employee Department letter, then, foreclose does not assessment of Revenue. The is fully by claim answered sales of thе taxes. our opinion in Group, Brown Inc. v. Admin Commission, istrative Hearing Country Club Appellant Louis (Mo. 877-78 banc we argues part also that a of the assessment held that the may Director Revenue dele expira it because of the against is invalid gate authority to processing subordinates in by period tion of thе allowed two-year assessments. It impossible would indeed be 144.220, within which the RSMo for the office to function delega without challenge sales tax returns. may Director tion. The notice of the here assessments voluntary waiver taxpayer executed states, involved “This the fi assessment is argues but now periоd, of the limitation nal decision of the Director of Reve and of no effect. this waiver is invalid that ” nue .... It is entirely order for the holding provi that contract cases It cites Director to authorize subordinates to au statute of limitations extending the sions thenticate assessments made in accordance inval very contract are for actions on that procedures. with established office Nor is stat that the federal id. It also observes any requirement there of the that notice the waiv authority for provide express utes delegation to a filed particular employee be period by agreement er of limitation published, procedures or that internal and the Internal Revenue Service between by formalized rule. statutes lack similar while state taxpayer, provisions. The next taxpayers argue that by waiver executed by rea We hold that the “estopped” Direсtor Revenue is contractual agreement, a letter in 1974 then is a valid taxpayer son of written consideration, that it is Rev- Department supported General Counsel of the Words effective accordance with its terms. S.W.2d might taxpayer hasty fear a and inaccurate accord- standing interpreted are to be alone assessment if it to enter declined into Blue ordinary meaning, ing agreement waiver requested by revenue a term is supra, but if authorities, that, might believe enter- defi- special specially by statute defined ing into the agreement, waiver could given nition effect. must be negotiate possibly satisfactory resolution plain language that We conclude controversy. The element of reliance statutes makes the governing apparent. the revenue authorities coun- tax. The question subject involving cases waivers contractual in ad- amusement, surely “plaсes of try clubs are controversy vance of actual do not cover recreation, games entertainment situations involved here. We conclude events,” the fees athletic and therefore entered a waiver into in order to permit charge as “sales retail” qualify *4 possibly further еxamination and negotia- not This in itself is 144.010.1(8). and of § by tion is not forbidden any provision of however, estab- sufficient, unless it is also law, proper purpose, serves and should be in “engaged taxpayers lished the are that given effect. compass the 144.010.- business” within of § 2. The Merits of the Assessments 1(2). The clubs allege that beсause meaning gives very special That section non-profit, are private, organizations social “business,” not limited to the term which is not which are in “engaged business” and Under enterprises. to commercial ordinary to, fees the were not or “paid any in “activity 144.010.1(2) “business” includes place amusemеnt, § of entertainment or rec to be reation”, engaged any person, or caused by their in fees do not fall within him, gain, the of with of purview 144.010.1(8) engaged object the and 144.020.- in §§ indi- advantage, benefit either direct or or 1(2). lan- (emphasis rect. This supplied). ...” 144.010.1(8) Section defines “sale at re- broad, surely designed and guage very is is tail” as not oth- might to make transactions any any person transfer made en- issue is erwise taxable. The be covered gaged business, in including sales of ad- allowing the “activity” whether the of tickets, admissions, mission cash charges paid by facilities a fee guests use the for to fees to or amusement, and of places object bene- gain, their “with the of host is recreation, entertainment games and indirect,” advantage, fit or either direct athletic events. does country clubs. director 144.020.1(2) Section sets the rate of tax on pur- has a taxpayer have to that show such sales. 144.010.1(5) Sectiоn defines revenue, deriving or of maximizing of pose to “person” individual, firm, “any include general public. income from the copartnership, joint adventure, association, corporation, municipal private, the clubs some benefit to There must be organized profit for or not....” facilities, or tо use the allowing guests 144.010.1(2), “business” is as defined Although the not be received. they would activity any engaged by any person, their restrict use of clubs want to him, caused to be engaged with the mem- a sufficient extent facilities to object gain, of advantage, benefit or ei- of infringed, privilege bers’ is not use direct or ther indirect. to is an obvious inducement having guests clubs. a benefit in the It is membership
Taxing statutes must be construed is to their a benefit the clubs because strictly, and are not to be taxes assessed want members, majority of whom must are expressly unless authorized law. clubs, Lines, bringing guests. the privilege of Air v. Tax United Inc. State Commis сourse, for of their sion, 444, only of the benefit (Mo. 1964); 377 448 exist S.W.2d banc members, undoubtedly whom con- Corporation many 592 Goldberg, Canteen v. 618
sider the opportunity guests statute, laws, entertain all to be like tax important be for in the give social or construed so as to the words business reasons. meaning. their plain ordinary As a statute charge is levied the guests’ for “recre- Blue v. ation”, the sales tax applies. 144.- Sections (Mo. 1977). Tax are to 598 banc laws 010.1(8)(a), 144.020.1(2), RSMo 1978. It strictly against taxing au- construed makes no pays charge. difference who Goldberg, 592 thority, Corp. Canteen depends Inasmuch spe- case on the (Mo. S.W.2d bаnc and where provisions cial laws, of the sales tax mean- there is a as to the reasonable doubt appellants’ status insofar as federal and statute, is re- ing of revenue doubt state income taxes are concerned is not taxed, Sands, solved favor those C. significant the copiоus citations to code Construction, 66.01 Statutory Sutherland sections, statutes, regulations govern- (4th Lines, 1974); ed. Air Inc. United ing pertinent. income are taxes Commission, Tax State S.W.2d It is of no moment that the country clubs do not actively promote the use re- Testimony before the Commission by guests revenue, facilities as а source of charged vealed that members were but substantially limit and burden discourage two non- purposes: of guests. introduction The Adminis- spread equitably and to Hearing trative Commission did not have to As to the first operations. cost of club accept all of the taxpayers’ nuances objeсt charging if the fees purpose, *5 evidence as to whether or not sought gain, or advan- were to obtain some benefit to “discourage” guests. ample This is basis to assume that tage, then it is reasonable for a finding an least indirect benefit encouraged be non-member would fees, from advantagе guest and we are However, the discouraged. than
obliged accept findings of the Com- usage, stringent restrictions on non-member if supported by mission “competent and the use of all including the limitation on substantial evidence on whole record.” a of times club facilities to certain number 161.338, Sec. RSMо 1978. that the non- per year requirement and the member, sup- accompanied by member be findings supported are adequately port purpose clubs’ that their contention and the decision of the Administrative Regarding such discourage was to use. Hearing Commission is affirmed. indicated purpose, tеstimony second guest an brings puts who RENDLEN, C.J., GUNN, HIGGINS and facilities; for that burden on the additional JJ., PREWITT, Special concur. Judge, charge to an additional reason he is assessed burden. The assessment offset that DONNELLY, J., separate dissents in charge members additional opinion filed. dues complex need for guests obviates the usage by the mem- structure based on BILLINGS, J., dissents and concurs in guests. Conse- ber, and his family, his separate dissenting opinion of DONNEL- fees are intended quently, LY, J. better than put position the clubs in a WELLIVER, J., sitting. his entertained were before the member the ad- to counterbalance guest, but rather DONNELLY, Judge, dissenting. on imposed that mеmber ditional burden respectfully I dissent. the club. 144.010.1(2) Section defines “business” as this case do not view, facts in my any activity engaged any person, charging show that caused to “with engaged object him clubs with the engaged direct object gain, advantage, advantage, either gain, benefit or benefit or indirect, tax statutes. supplied). direct or (emphasis indirect” fees were in actuality special dues, assessments or additional membership subject
neither of which is claimed to be Club, tax.
any sales Potowomut Golf See Norberg,
Inc. v. 114 R.I. A.2d 226
(1975).
I would reverse. CORPORATION, Relator,
SPERRY CORCORAN,
The Honorable James S.
Judge, Court, Circuit St. Louis
City, Respondent. PRATER,
STATE ex rel. B.G. et
al., Relator, CORCORAN,
The Honorable James S. Court,
Judge, Circuit
City, Respondent.
LESTER E. COX MEDICAL INC.,
CENTER, Relator, CORCORAN,
The Honorable S. James
Judge, Court, Circuit
City, Respondent.
Nos. 64694 and 64669.
Supreme Missouri, Court
En Banc.
Sept. 1983.
Rehearing Denied Oct.