Gooderham & Worts, Ltd. v. Collins

KNIGHT, J. The plaintiff, Gooderham & Worts, Ltd., appeals from a judgment for defendants in an action to recover the sum of $1,075.30 theretofore paid under protest to the state as excise taxes on nineteen separate sales of alcoholic beverages.

The sales were made by plaintiff during the years 1936 and 1937; and the taxes were collected by the State Board of Equalization under the authority of the 1935 Alcoholic Beverage Control Act (Stats. 1935, p. 1123, Deering’s Gen. Laws, 1935, Act 3796.) Section 24 of the act provided: “An excise tax is hereby imposed upon all distilled spirits sold in this State . . .”; and section 2 (1) declared that the words “sell” and “sale” and the phrase “to sell” as used in the act “means and includes any of the following: to exchange, barter, traffic in; to solicit or receive an order for; ... to traffic in or deliver for value or in any way other than gratuitously; to possess with intent to sell”; but that the “transfer of title to alcoholic beverages unaccompanied by a transfer of possession of such beverages shall not be deemed a sale of such beverages.” The plaintiff is a Delaware corporation, qualified to do business in California, and at the time these transactions took place operated a place of business in Los Angeles where it kept, offered for sale and sold a stock of distilled liquors. Its business was carried on under two separate licenses issued by the State of California pursuant to section 5 of said act, to wit, an “importer’s license,” and a “wholesaler’s license.” Section 6 (d) of the act provided that “Any importer’s license authorizes the person to whom issued . . . to export such alcoholic beverage”; and section 6 (f) provided that “Any wholesaler’s license authorizes the sale of the alcoholic beverage specified in the license only to persons holding licenses issued by the board authorizing the sale of such alcoholic beverage.” The sales in question were made to Nevada Wholesale Liquor Company, a Nevada corporation, and Central Distributing Company, an Arizona corporation. Each was licensed by the state of its domicile as a wholesale distributor of liquor in that state, but neither was qualified to do business in California, nor did either hold any sort of a liquor license under the laws of this state. The liquor was purchased for resale in those states, but the orders called for “delivery F. O. B.” at plaintiff’s warehouse in Los Angeles. The orders were solicited by plaintiff’s salesmen in Nevada and Arizona, and by them mailed to or delivered at plaintiff’s [311]Los Angeles place of business; whereupon plaintiff filled the orders from its stock at its warehouse in Los Angeles, and delivered the liquor at the warehouse to the purchasers’ employees, who placed it upon trucks owned and operated by the purchasers and driven by the purchasers’ employees. The liquor was then transported by the purchasers’ employees on said trucks out of the state; and no part thereof was resold or used in California.