O'Kelley-Eccles Co. v. State

160 Cal.App.2d 60 (1958) 324 P.2d 683 O'KELLEY-ECCLES COMPANY (a Corporation), Appellant,

v.

THE STATE OF CALIFORNIA et al., Respondents.

Docket No. 9306. Court of Appeals of California, Third District.

May 2, 1958. [61] Hanna & Morton and James M. McRoberts for Appellant.

Edmund G. Brown, Attorney General, James E. Sabine and Irving H. Perluss, Assistant Attorneys General, and Edward P. Hollingshead, Deputy Attorney General, for Respondents.

VAN DYKE, P.J.

This is an appeal from a judgment denying recovery of taxes paid under protest. Appellant is a retailer within the meaning of the Sales and Use Tax Law and made retail sales in this state subject to sales taxes. It claimed that by virtue of its methods of doing business a part of its receipts which constituted charges for the delivery of items sold should be excluded from the computation of gross receipts from sales.

Appellant's methods of doing business which are pertinent here may be stated as follows: Appellant manufactures and sells concrete building blocks at "FOB Plant" prices. If delivery is made by appellant to a place designated by the buyer a specific delivery charge is made in addition to the "FOB Plant" price. About half of the blocks sold by appellant are so delivered. Appellant's price schedules set forth prices "FOB Plant" for various sizes and styles of blocks and separately stated set forth the charges for delivery within a radius of 30 miles. Appellant grants discounts from its published "FOB Plant" prices favoring customers such as contractors who buy large quantities, but discounts are not given on that part of the total cost to the customer which constitutes the delivery charge. In paying its sales taxes, appellant deducted from the gross amount received from sales the amounts received for delivery. Respondents reassessed and demanded payment of the tax upon the excluded amounts. Appellant paid under protest.

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