From Casetext: Smarter Legal Research

Parkinson v. Limbach

Supreme Court of Ohio
Mar 7, 1990
49 Ohio St. 3d 163 (Ohio 1990)

Opinion

No. 88-1162

Submitted February 13, 1990 —

Decided March 7, 1990.

Taxation — Sales tax — Failure to collect tax on sales — R.C. 5739.33 — Vendor personally liable for amount due.

APPEAL from the Board of Tax Appeals, No. 86-H-745.

Heath Pallet Company ("Heath"), an Ohio corporation, was assessed sales tax based in part upon its failure to collect tax on sales it had made. The assessment was affirmed upon appeal to the Board of Tax Appeals ("BTA").

Thereafter, the Tax Commissioner, pursuant to R.C. 5739.33, assessed appellants for the unpaid sales tax obligation of Heath for failure to collect and remit tax on sales to Heath's customers.

Appellants, Carl and Nancy Parkinson, were responsible corporate officers of Heath. Heath filed all sales tax returns and remitted to the state all sales tax actually charged to and collected from its customers at all times pertinent herein.

In their appeal to the BTA, appellants contended that R.C. 5739.33 applied only when there was a failure to file a return or to remit sales tax actually collected.

The BTA held that the statute applied as well when there was a failure to collect sales tax due and affirmed the Tax Commissioner's assessment against appellants.

Squire, Sanders Dempsey and Ted B. Clevenger, for appellants.

Anthony J. Celebrezze, Jr., attorney general, and Richard C. Farrin, for appellee.


R.C. 5739.33, as applicable, reads:

"If any corporation required to * * * remit tax due to the state under the provisions of sections 5739.01 to 5739.31, inclusive, of the Revised Code, fails for any reason to make such * * * payment, any of its officers * * * charged with the responsibility of * * * making payments, shall be personally liable for such failure. The dissolution of a corporation shall not discharge an officer's * * * liability for a prior failure of the corporation to * * * remit tax due. The sum due for such liability may be collected by assessment in the manner provided in section 5739.13 of the Revised Code."

Under this statute, a corporation's failure to remit sales tax due to the state creates personal liability in the responsible corporate officers to make such payments and that liability may be collected by an assessment against the officers.

The statute is specific and unambiguous.

R.C. 5739.03 provides:

"* * * [E]ach vendor shall collect from the consumer, as a trustee for the state of Ohio, the full and exact amount of the tax payable on each taxable sale * * *."

R.C. 5739.29 states:

"No vendor shall fail to collect the full and exact tax as required by sections 5739.01 to 5739.31, inclusive * * *."

R.C. 5739.13, as applicable, concludes the applicable scheme of taxation and liability, as follows: "If any vendor collects the tax imposed * * * and fails to remit the same to the state * * *, he shall be personally liable for any amount collected which he failed to remit. * * *

"If any vendor fails to collect the tax * * * on any transaction subject to the tax, such vendor * * * shall be personally liable for the amount of the tax * * *."

These statutes describe the nature and extent of sales tax which is due to the state. Included within the scope of tax due is tax which has been collected, as well as the liability of the vendor to pay the tax even though it has not been collected. The vendor is clearly charged with personal responsibility to collect all applicable taxes and his or her failure results in personal liability for the tax, the sum of which can be assessed against the vendor under R.C. 5739.13. As previously stated, R.C. 5739.33 authorizes a shifting of tax liability to responsible corporate officers. The parties have stipulated that the vendor in this case is a corporation and that appellants are responsible officers of the corporation.

Appellants' reliance on their definition of "remit" is fruitless in the context of its use in these tax statutes. It is true that one of the definitions found in Webster's New International Dictionary (2 Ed. 1956) 2107, is "4. [t]o send back * * *," but that construction is pointless in construing the term in the applicable statute. The reference in R.C. 5739.33 is to "remit tax due to the state." The more acceptable definition from Webster's, supra, is:

"9. * * * [t]o transmit or send * * * in payment of a demand, account, draft, * * *."

More significant is the definition of "due." Webster's defines it as: "1. [o]wed or owing as a debt." Id. at 796.

Black's Law Dictionary (5 Ed. 1979) 448, is in accord:

"Just; proper; regular; lawful; sufficient; reasonable, as in the phrases `due care,' `due process of law,' `due notice.'

"Owing; payable; justly owed. That which one contracts to pay or perform to another; that which law or justice requires to be paid or done."

Finally, the word "collected," referenced in R.C. 5739.99(E) relative to the penalty for failure to remit to the state the tax collected, is not used in R.C. 5739.33 as a qualifier of the corporation's responsibility to remit tax due to the state. This court will give effect to the words used in a statute and will not insert words not used. Wheeling Steel Corp. v. Porterfield (1970), 24 Ohio St.2d 24, 28, 53 O.O. 2d 13, 15, 263 N.E.2d 249, 251.

It follows that appellants are liable for all tax due to the state, not merely the tax collected. Rowland v. Collins (1976), 48 Ohio St.2d 311, 2 O.O. 3d 450, 358 N.E.2d 582.

The decision of the Board of Tax Appeals being neither unreasonable nor unlawful is affirmed.

Decision affirmed.

MOYER, C.J., SWEENEY, HOLMES, DOUGLAS, WRIGHT, H. BROWN and RESNICK, JJ., concur.


Summaries of

Parkinson v. Limbach

Supreme Court of Ohio
Mar 7, 1990
49 Ohio St. 3d 163 (Ohio 1990)
Case details for

Parkinson v. Limbach

Case Details

Full title:PARKINSON ET AL., OFFICERS OF HEATH PALLET COMPANY, APPELLANTS, v…

Court:Supreme Court of Ohio

Date published: Mar 7, 1990

Citations

49 Ohio St. 3d 163 (Ohio 1990)
551 N.E.2d 200

Citing Cases

Spithogianis v. Limbach

R.C. 5739.33 imposes personal liability on officers or employees when a sales tax assessment against a…