Case Title: Russell Petroleum, Inc. v. The City of Wetumpka, Alabama, a municipal corporation

Citation: 

Docket Number: 1041001

State: alabama

Court: Alabama Supreme Court

Date: 2007-06-15T00:00:00Z

Document:
REL:06/15/07russellpetroleum
Notice: This opinion is subject to formal revision before publication in the advance
sheets of Southern Reporter.  Readers are requested to notify the Reporter of Decisions,
Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-
0649), of any typographical or other errors, in order that corrections may be made before
the opinion is printed in Southern Reporter.
SUPREME COURT OF ALABAMA
 OCTOBER TERM, 2006-2007
_________________________
1041001
_________________________
Russell Petroleum, Inc.
v.
City of Wetumpka, a municipal corporation
Appeal from Elmore Circuit Court
(CV-02-375)
BOLIN, Justice.
Russell Petroleum, Inc., appeals a judgment by the Elmore
Circuit Court holding (1) that property on which Russell
Petroleum operated a gasoline service station was validly
annexed into the municipal limits of the City of Wetumpka
1041001
The Act was introduced in the legislature on April 3,
1
2001; it became law on May 18, 2001.  
2
("the City"), pursuant to Act No. 2001-543, Ala. Acts 2001
("the Act"), and (2) that, as a consequence of that
annexation, Russell Petroleum owes the City for unpaid
municipal business-license fees, gasoline taxes, sales taxes,
and penalties.  We affirm that part of the judgment that
validated the annexation, but reverse the judgment insofar as
it orders Russell Petroleum to remit to the City municipal
sales taxes.
I.  Facts and Procedural Background
Since 1999 Russell Petroleum has operated a convenience
store and gasoline station on property along U.S. Highway 231
in Elmore County ("the business"). In 2000 the City passed an
annexation ordinance that brought the business into the
police jurisdiction of the City. The following year the
legislature enacted the Act, expanding the municipal limits of
the City by annexing several parcels of land, including the
land on which the business was operated, that were formerly
outside its boundaries ("the annexation").1
On the effective date of the annexation, the City had in
effect 
business-licensing, 
municipal-gasoline-tax, 
and
1041001
The City did not seek unpaid sales taxes in its
2
complaint. Evidence regarding sales taxes was received by the
trial court, and the court effectively conformed the pleadings
to the evidence and determined that sales taxes were also in
dispute. See discussion at Part III.B, "Jurisdiction to
Adjudicate Sales-Tax Liability."
3
municipal-sales-tax regulations.  Russell Petroleum did not
apply for, or secure, a business license after the annexation.
On August 6, 2002, the City sued Russell Petroleum to collect
(1) unpaid business-license fees related to the operation of
the business during the calendar years 2001 and 2002, and (2)
gasoline taxes that Russell Petroleum did not remit to the
City on retail sales of gasoline by the business.2
Russell Petroleum denied that it was required to purchase
a business license from the City or to remit any gasoline
taxes.  Russell Petroleum asserted in its answer to the City's
complaint that it owed no obligations to the City because, it
argued, the annexation of the property on which the business
is located was invalid.  Russell Petroleum also filed a
counterclaim asking the trial court to declare the Act
unconstitutional and invalid. Among other claims, Russell
Petroleum alleged in its counterclaim that the Act was invalid
because, it argues, its proponents failed to comply with the
requirement in § 11-42-6(b), Ala. Code 1975, that "a map
1041001
4
showing what territory is  to be legislatively annexed to ...
[the municipality] [be] on file in the office of the judge of
probate in the county ... wherein [the] territory is located."
Further, when Russell Petroleum filed its counterclaim, it
interpleaded $36,534.68 into court and asked the trial court
to direct "a cy pres refund ... of any taxes or penalties
wrongfully, 
illegally 
or 
unconstitutionally 
collected."
According 
to 
Russell 
Petroleum's 
counterclaim, 
the
interpleaded funds represented "license fees and gasoline
taxes for all periods of illegal assessment."   
In October 2002 the City moved the trial court to dismiss
the counterclaim and order Russell Petroleum to pay the
contested business-license fees and gasoline taxes.  Stating
that there appeared to be disputed facts concerning the City's
compliance with the Alabama Constitution or certain statutes
in annexing the property into the municipal limits, the trial
court denied that motion and set the City's action for a bench
trial on September 23, 2003.  Before trial, Russell Petroleum
filed an amended answer contesting the City's right to collect
taxes for the period in which the business was within the
police jurisdiction of the City pursuant to municipal
ordinance, but outside the municipal limits.  When the trial
1041001
5
commenced, the City relinquished its claim against Russell
Petroleum for unpaid taxes during that period in which Russell
Petroleum was operating in the police jurisdiction, and
Russell Petroleum agreed not to challenge the ordinance that
brought 
the 
business 
within 
the 
police 
jurisdiction.
Consequently, the issues considered at trial were limited to
(1) the City's claim for unpaid business-license fees and
gasoline taxes in the period after the property on which the
business is located was annexed into the municipal limits of
the City in 2001, and (2) Russell Petroleum's claims
challenging the constitutionality and validity of the Act.
At the September bench trial the court heard oral
testimony and received evidence concerning the enactment of
the Act; the subjects addressed included the notices of intent
to introduce the Act that were published in the Wetumpka
Herald, actions taken in the legislature relating to the
passage of the bill that became the Act, and the use of a map
prepared by the City that detailed the property to be annexed.
Rejecting Russell Petroleum's challenge to the Act, the trial
court entered an order on October 1, 2003, which stated:
"This Court finds that the passage of [the Act]
was proper and constitutionally valid.  This Court
thereby denies [Russell Petroleum's] counterclaim.
1041001
6
[Russell Petroleum's] property is included on the
property annexed by [the Act].  Therefore, [Russell
Petroleum] is responsible for payment of appreciable
business license fees as well as collection and
payment of appreciable taxes. ...
"The parties are hereby ordered to work together
to have an audit performed to determine the exact
amount of business license fees and taxes due to the
City of Wetumpka in accordance with this order.
This Court reserves jurisdiction to enter further
orders to assure compliance with this order." 
Following that order, however, the parties were unable to
resolve their dispute concerning the amounts allegedly owed by
Russell Petroleum. Evidence indicated that the $36,534.68
amount that Russell Petroleum had paid into court related to
its collection of sales taxes on retail purchases, not to
business-license fees or gasoline taxes as it initially
pleaded.  By March 2004, Russell Petroleum was contesting the
City's right to collect sales taxes on retail transactions.
Notwithstanding that dispute, by that time Russell Petroleum
had collected approximately $78,000 in sales taxes after 2002.
In an effort to end the litigation, the City in June 2004
filed a motion for a summary judgment on all remaining issues.
In support of that motion, the City presented evidence
indicating that Russell Petroleum owed it the following sums
1041001
7
for the period from January 1, 2002, through February 29,
2004:
1. 
$11,370.75 
($9,096.60 
plus 
$2,274.15 
in
penalties) in business-license fees for the years
2002, 2003, and 2004;
2. 
$62,783.51 
($52,319.59 
plus 
$10,463.92 
in
penalties) in municipal gasoline taxes; and
3.
$90,274 
($78,249.82 
plus 
$12,024.18 
in
penalties) in sales taxes.
On August 16, 2004, the trial court granted the City's
summary-judgment motion and issued its second order regarding
Russell Petroleum's obligations.  In entering a final judgment
for the City, the trial court found that "[s]ales taxes were
placed at issue in this case" and that Russell Petroleum owed
the City "the amount of $164,428.26 for license fees, gas
taxes, sales taxes, and penalties for the period from January
1, 2002, to February 29, 2004 ...."  The trial court also
ordered that the funds Russell Petroleum had paid into court
be credited against its $164,428.26 liability and that it pay
all gasoline taxes and sales taxes for the months March
through July 2004 or be restrained from operating the
business.  Russell Petroleum timely filed this appeal
following the trial court's denial of its postjudgment motion
to alter, amend, or vacate the final judgment.  
1041001
8
II. Standard of Review
The ore tenus standard of review applies with respect to
the trial court's findings. We have described that standard as
follows:
"'"When a judge in a nonjury case hears oral
testimony, a judgment based on findings of fact
based on that testimony will be presumed correct and
will not be disturbed on appeal except for a plain
and palpable error."' ...  
"'"The ore tenus rule is grounded upon the
principle that when the trial court hears
oral testimony, it has an opportunity to
evaluate the demeanor and credibility of
witnesses." 
... 
The 
rule 
applies 
to
"disputed issues of fact," whether the
dispute 
is 
based 
entirely 
upon 
oral
testimony or upon a combination of oral
testimony and documentary evidence....
"'"... [T]his Court will not
disturb 
the 
trial 
court's
conclusion unless it is clearly
erroneous and against the great
weight of the evidence ...."'
"... 
However, 
'that 
presumption 
[of 
correctness]
has no application when the trial court is shown to
have improperly applied the law to the facts.'..."
Robinson v. Evans, [Ms. 1051344, Dec. 8, 2006] ___ So. 2d
_____, ____ (Ala. 2006).  When the trial court does not make
any specific finding of fact on a matter pertinent to its
judgment, 
1041001
9
"this Court will assume that the trial judge made
those findings necessary to support the judgment.
... Under the ore tenus rule, the trial court's
judgment and all implicit findings necessary to
support it carry a presumption of correctness and
will not be reversed unless 'found to be plainly and
palpably wrong.' ...   'The trial court's judgment
in such a case will be affirmed, if, under any
reasonable aspect of the testimony, there is
credible evidence to support the judgment.'"
Transamerica Commercial Fin. Corp. v. AmSouth Bank, N.A., 608
So. 2d 375, 378 (Ala. 1992).
The  well-established standard of review for a summary
judgment applies to the trial court's August 16, 2004, order
granting the City's June 2004 summary-judgment motion.  That
standard was stated in Prince v. Poole, 935 So. 2d 431, 442
(Ala. 2006): 
"'This Court's review of a summary judgment is
de novo. We apply the same standard of review as the
trial court applied. Specifically, we must determine
whether the movant has made a prima facie showing
that no genuine issue of material fact exists and
that the movant is entitled to a judgment as a
matter of law. Rule 56(c), Ala. R. Civ. P. In making
such a determination, we must review the evidence in
the light most favorable to the nonmovant. Once the
movant makes a prima facie showing that there is no
genuine issue of material fact, the burden then
shifts to the nonmovant to produce "substantial
evidence" as to the existence of a genuine issue of
material 
fact. 
Ala. 
Code 
1975, 
§ 
12-21-12.
"[S]ubstantial evidence is evidence of such weight
and quality that fair-minded persons in the exercise
of impartial judgment can reasonably infer the
existence of the fact sought to be proved."'"
1041001
Russell Petroleum argued to the trial court that the Act
3
did not comply with § 106, Ala. Const. 1901.  However, Russell
Petroleum does not contest the constitutionality of the Act
before this Court. 
10
(Citations omitted.) Further, when reviewing a summary
judgment, this Court resolves all reasonable doubts against
the movant. Prowell v. Children's Hosp. of Alabama, 949 So. 2d
117, 126 (Ala. 2006).
III. Analysis
Russell Petroleum makes the following two arguments in
support of reversing the summary judgment:  (1) that the
annexation was invalid because, Russell Petroleum argues, the
Act was not enacted in compliance with § 11-42-6(b), Ala. Code
1975;  and (2) that the trial court did not have subject-
3
matter jurisdiction to order Russell Petroleum to remit sales
taxes.
A. Compliance with § 11-42-6(b)
Section 11-42-6, Ala. Code 1975, mandates certain
procedural requirements when the legislature considers a local
bill that proposes to change the territorial boundaries of a
municipality.  That statute provides:
"(a) Any bill introduced in the legislature
which attempts to annex territory to a municipality
... shall contain an accurate description of the
1041001
11
territory proposed to be annexed to ... such
municipality together with a plat or map of such
territory attached .... Copies of such map shall
also be furnished to the judge of probate for the
county ... where the territory proposed to be
annexed to ... the municipality is located. 
"(b) The publication of notice of intention to
apply for any local law annexing territory to any
municipality ... shall ... state that a map showing
what territory is to be annexed to ... such
municipality is on file in the office of the judge
of probate in the county ... wherein such territory
is located and that such map is open to the
inspection of the public."
§ 11-42-6, Ala. Code 1975 (emphasis supplied).  The trial
court found in its October 1, 2003, order that "the passage of
the Act was proper"; "the map [showing the property to be
annexed] was filed in the office of the judge of probate on
March 1, 2001"; and "the notice was published as required by
the guidelines set out in §11-42-6(b)." The trial court made
those findings after the September 2003 trial in which it
heard oral testimony and received evidence concerning, among
other subjects, the City's efforts to comply with § 11-42-
6(b).   
On appeal, Russell Petroleum argues that the map
contemplated in  § 11-42-6 was not "on file" and therefore not
"open to the inspection of the public" within the meaning of
subsection (b).  The purpose of that map is to provide notice
1041001
In pertinent part, § 106, Ala. Const. 1901, provides that
4
no special, private, or local law on any subject not
enumerated in § 104 shall be passed unless legal notice of
that bill is published at least once a week for four
consecutive weeks in a newspaper in the affected county before
the bill is introduced. 
12
to the public of the property to be annexed.  With access to
that information, interested persons can learn about a
proposed annexation law, determine if they would be affected
by a change in municipal boundaries, and fairly protest or
otherwise express their views on the proposed legislation.
Also, subsection (b) provides that the notice of intention to
apply for a local annexation law shall "state that a map
showing what territory is to be annexed to ... such
municipality is on file in the office of the judge of probate
in the [affected] county."   Pursuant to subsection (a), a
4
"cop[y] of such map shall also be furnished to the judge of
probate for the county ... wherein the territory proposed to
be annexed to ... the municipality is located."  Because the
notice of the proposed local law must be published before the
bill is introduced in the legislature, the map mandated by §
11-42-6 necessarily must be furnished to the office of the
probate judge in the affected county at or before the
beginning of the public-notice period. 
1041001
13
 
The 
trial 
court 
received 
the 
following evidence
concerning the issue of compliance with the notice requirement
and with § 11-42-6.  The notice of intention to introduce this
local annexation bill was first published in the Wetumpka
Herald on March 1, 2001; subsequent notices followed on March
8, 15, and 22.  That notice stated that the map indicating the
change in the municipal boundary was on file in the office of
the Elmore County probate judge.  The clerk for the City
testified that, on either February 28 or March 1, 2001, she
furnished the chief clerk of the Elmore County Probate Court
a copy of that legal notice and the map showing the territory
to be annexed. 
After the city clerk left the map and the notice in the
probate judge's office, the chief probate clerk was unsure
what to do with them.  Initially, she gave the map and the
notice to the probate judge and sought his advice on how to
maintain them; the probate judge subsequently returned them to
her.  The chief probate clerk also asked her fellow employees
in the probate office whether the map and the notice should be
recorded as a formal proceeding or indexed.  Deciding against
those options, the chief probate clerk on or about May 2,
2001, placed the map and the notice in a file folder and
1041001
Russell Petroleum argues that there was contradictory
5
testimony concerning when the probate office received the map.
14
stored that file folder on a corner of her desk.  The creation
of that folder was the first "recordation" by the probate
office that the map had been received in that office.  The
chief probate clerk, her assistant, and the probate judge knew
about the folder containing the notice and the map, but not
all members of the probate office staff were aware of the
existence of the folder containing the map and the notice.
The evidence also indicated that one visitor to the Elmore
County probate office requested to see the map and reviewed
it.  Subsequently, in December 2001 the chief probate clerk
indexed the map in the probate records of the Elmore County
probate office.
Drawing all reasonable inferences in support of the trial
court's findings of fact, we conclude that there was
substantial evidence from which the trial court could have
found that the map was furnished to the Elmore County probate
office by the city clerk on or before March 1, 2001 -- the
first date of the public-notice period and over one month
before the bill that became the Act was introduced in the
legislature.   Accordingly, the trial court did not err when
5
1041001
The chief probate clerk did not recall the exact date of its
receipt. The city clerk, however, testified that she delivered
the map to the chief probate clerk on or before March 1, 2001
-- the first date of publication of legal notice of the Act.
Considering the testimony of both these witnesses, the trial
court could have found that the map was furnished to the
Elmore County Probate Court no later than March 1, 2001.    
15
it found that the City satisfied the timeliness component of
§ 11-42-6 by furnishing the map to the probate office on or
before the commencement of the public-notice period for the
Act contemplated by § 106, Ala. Const. 1901. 
The City argues that, having made this finding, we need
not inquire further.  According to the City, all that § 11-42-
6(b) requires is (1) a statement in the notice of intention to
apply for a local law that a map showing the boundary change
is available in the office of the probate judge, and (2) that
the map be timely furnished to the probate judge.  However,
Russell Petroleum argues that, even if the requisite statement
was made and the City timely furnished the map to the probate
office, we must determine whether the map was "on file" and
available for inspection in that office within the meaning of
§ 11-42-6(b).  According to Russell Petroleum, an instrument
is not "filed" in the probate office until some record of its
physical receipt is made and the public can readily access the
1041001
16
instrument.  Although the chief probate clerk created a file
folder on May 2, 2001, into which she placed the map, Russell
Petroleum argues that the "filing" of the map did not occur
until the chief probate clerk indexed the map in the general
register in December 2001.  Because the time of that indexing
did not precede the public-notice period, Russell Petroleum
contends that the annexation legislation was infirm because,
it argues, the map was not "open to the inspection of the
public."  
To comply with the requirements concerning the boundary-
change map in § 11-42-6, the proponents of a local act must do
more than furnish that map to the probate office and state in
the public notice that the map can be inspected there.  Merely
furnishing the map to the probate court is of no import unless
it also is open to inspection.  Accordingly, we must examine
whether the map in this case actually was available for
inspection by the public.
 
We have not found, nor have we been directed to, any
decisions addressing what actions a probate office must
undertake before a boundary-change map is open to inspection
within the meaning of § 11-42-6(b).  Directing us to the "on
file" language in subsection (b), Russell Petroleum argues
1041001
17
that the map is unavailable unless the probate office records
it in the same manner as it records real-property and other
instruments.  As support for its argument, Russell Petroleum
cites two other statutes that address a probate judge's duties
concerning the filing of records.  First, Russell Petroleum
notes that, pursuant to § 12-13-41(3), Ala. Code 1975, a
probate judge is obligated "[t]o keep all the books, papers
and records belonging to his office with care and security,
the papers arranged, filed and labeled so as to be of easy
reference and the books and records lettered and kept with
general, direct and reverse indexes ...."  Second, Russell
further argues that  § 12-13-43, Ala. Code 1975, is
persuasive; in pertinent part, that provision requires probate
judges to keep "books ... in which to make a general direct
and a general reverse index of each instrument filed for
record in his office ...."  The City counters that § 12-13-
41(15), Ala. Code 1975, specifies those instruments the Elmore
County probate judge shall record in the general register
having a direct and reverse index, and that annexation maps
are not listed in subsection (15) as one of those instruments.
We disagree with Russell Petroleum's argument that the
annexation map was not open to inspection during the public-
1041001
18
notice period for the Act.  Effectively, Russell Petroleum
asks that we engraft language onto § 11-42-6(b) that specifies
the precise manner in which a probate office must maintain a
boundary-change map furnished to it pursuant to that statute.
The legislature did not, however, state in § 11-42-6(a) or (b)
that a map of the property to be annexed must be indexed,
bound, filed, or recorded in any particular form.  Further, we
reject Russell Petroleum's argument that, because of the
inclusion of the words "on file" in subsection (b), we should
interpret that provision as requiring a probate judge to
record an annexation map in the same manner as real-property
records, records of judicial proceedings, or other instruments
indexed in the general register.  The "on file" language in §
11-42-6(b) connotes that the office of the probate court is
the repository for boundary-change maps, not that those maps
"belong to" the office of the probate judge and must be
indexed in the general register. See § 12-13-41(3), Ala. Code
1975.
Under this interpretation of the "on file" language in §
11-42-6(b), the proponents of a local act can comply with the
requirement regarding the boundary-change map  in § 11-42-6 if
there is substantial evidence that the map was "open to the
1041001
19
inspection of the public" in the probate office during the
public-notice period.  The chief probate clerk testified that,
before she indexed the map, at least one person asked to see
it; the office staff then located the map, and it was
furnished as requested.  Moreover, Russell Petroleum did not
present 
any 
evidence 
indicating 
that 
any 
of 
its
representatives or other members of the public attempted to
see the map but were denied access to it. Based on this
evidence, other testimony by the chief clerk of the probate
court, and the testimony of the city clerk, the trial court
could have found that, during the public-notice period for the
Act, the map the City furnished to the Elmore County probate
office was open to inspection by the public in that office.
Accordingly, the trial court did not err when it held that the
City had complied with the notice requirements in § 11-42-
6(b).   
B. Jurisdiction to Adjudicate Sales-Tax Liability
After the trial court upheld the Act, it determined that
Russell Petroleum owed the City "$164,428.26 for [business]
license fees, gas taxes, sales taxes, and penalties ...."
Russell Petroleum does not contest that, if the annexation is
valid, the trial court could have entered a judgment with
1041001
20
respect to business-license fees and municipal gasoline taxes.
It argues, however, that the judgment should be reversed
because, it says, the trial court lacked jurisdiction to order
Russell Petroleum to pay municipal sales taxes. 
A brief overview of the facts related to the sales-tax
award is necessary.  In its complaint the City sought to
collect only municipal business-license fees and gasoline
taxes.  Although Russell Petroleum claimed that the collection
of those taxes was illegal, it interpleaded $36,534.68 into
court; Russell Petroleum alleged in its counterclaim that
those moneys constituted "license fees and gasoline taxes." 
Russell Petroleum further alleged that, because the annexation
was invalid and it did not have records indicating the
identities of its customers, the trial court should order a cy
pres refund of the funds it had paid into court. 
As noted above, the trial court received evidence
indicating (1) that the funds paid into court were municipal
sales taxes that Russell Petroleum had collected from its
retail customers, and (2) that Russell Petroleum had collected
over $78,000 in those taxes after 2001. Given these
circumstances, the trial court effectively conformed the
pleadings to the evidence when it found that "sales taxes were
1041001
21
placed in dispute in this case."  Moreover, when it entered a
judgment for the City, it ordered Russell Petroleum to remit
all three types of contested funds -- business-license fees,
gasoline taxes, and sales taxes. 
Unquestionably, the evidence and developments below
supported the trial court's finding that Russell Petroleum
interjected 
the 
sales-tax 
dispute 
into 
consideration.
Notwithstanding, we agree with Russell Petroleum that the
trial court did not have authority to order it to pay sales
taxes.
In 1992 the legislature enacted the Taxpayers' Bill of
Rights and Uniform Revenue Procedures Act, Ala. Code 1975, §
40-2A-1 et seq. ("the TBOR").  The legislature intended that
the TBOR provide equitable and uniform procedures for the
assessment and collection of taxes and for the resolution of
tax disputes between taxpayers and the Alabama Department of
Revenue ("the Department"). § 40-2A-2(1)a.  In disputes
concerning unpaid taxes, the TBOR, among other things,
established procedures for the entry of a preliminary
assessment, a request by the taxpayer for an administrative
review of a preliminary assessment, a final assessment, the
appeal of a final assessment to the administrative law
1041001
22
division of the Department, and an appeal to circuit court of
any final order issued by an administrative law judge. See §§
40-2A-4, -7, and -9.  The TBOR is not merely procedural
legislation, "but also deals with the rights, remedies, and
responsibilities of both taxpayers and the Department."  Ex
parte State Dep't of Revenue, 792 So. 2d 380, 383 (Ala. 1999).
Initially, the administrative requirements of the TBOR
were directed only to the activities of the Department.
However, the legislature subsequently passed the Local Tax
Simplification Act of 1998, Act No. 98-192, Ala. Acts 1998
("the LTSA").  Section 2 of that act states: 
"The Legislature finds and declares that the
enactment by this state of a simplified system of
local sales, use, rental, and lodgings taxes which
may 
be 
levied 
by 
or 
for 
the 
benefit 
of
municipalities and counties in Alabama effectuates
desirable public policy by promoting understanding
of and compliance with applicable local tax laws.
..."
Section 3 amended, among other sections, § 11-51-201(a), Ala.
Code 1975, to read as follows:
"§ 11-51-201
"(a) All taxes levied or assessed by any
municipality pursuant to the provisions of Section
11-51-200 shall be subject to all definitions,
exceptions, exemptions, proceedings, requirements,
provisions, rules and regulations promulgated under
the Alabama Administrative Procedure Act, direct pay
1041001
23
permit 
and 
drive-out 
certificate 
procedures,
statutes 
of 
limitation, 
penalties, 
fines,
punishments, and deductions for the corresponding
state tax as are provided by Sections 40-2A-7, 40-
23-1, 40-23-2, 40-23-2.1, 40-23-4 to 40-23-31,
inclusive, 40-23-36, 40-23-37, except for those
provisions relating to the tax rate, and 40-23-38,
except 
where 
inapplicable 
or 
where 
otherwise
provided in this article."
 
Upon enactment of the LTSA, both § 11-51-201(a) (concerning
municipal 
sales 
taxes) 
and 
§ 
11-51-203(a)(addressing 
municipal
excise, use, and lodging taxes) were amended to add language
stating that the assessment of those local taxes impacted by
the LTSA were "subject to all definitions, exceptions,
exemptions, proceedings, requirements, provisions, rules and
regulations promulgated under the Alabama Administrative
Procedure Act" for the corresponding state tax. 
 Considering the TBOR (including a 1998 amendment thereto
now codified at § 40-2A-13) and the LTSA in their entirety, we
held as follows in General Motors Acceptance Corp. v. City of
Red Bay, 894 So. 2d 650 (Ala. 2004): 
"[The LTSA] made the TBOR equally applicable to tax
assessments and tax-collection procedures by local
taxing authorities such as [municipalities and
counties]. ...
"....
"... The statutes amended by the LTSA clearly
adopt the administrative rules and regulations
1041001
The City engaged the Alabama Department of Revenue to
6
collect its sales taxes. 
24
promulgated by the Department to implement the TBOR,
thus making municipalities and counties subject to
the statutory mandates applicable to both taxing
authorities and taxpayers alike when enforcing the
State's tax laws."
894 So. 2d at 653-54.
  
Here the City did not use the administrative procedures
mandated by the TBOR when collecting its sales taxes.   It did
6
not provide Russell Petroleum notice of a preliminary or final
assessment of sales taxes, and there was no administrative
consideration 
of 
the 
dispute 
concerning 
that 
alleged
deficiency.  Instead, the City's initial attempt to collect
sales taxes from Russell Petroleum occurred in the Elmore
Circuit Court.  
We recently were confronted with an analogous situation
in City of Red Bay, supra.  There the municipality filed an
action in the circuit court to collect sales and/or rental
taxes on vehicles leased by the defendant; the administrative
procedures envisioned by the TBOR were not invoked before that
action was filed.  894 So. 2d at 652.  Relying on the well-
reasoned authority in Patterson v. Gladwin Corp., 835 So. 2d
137, 153 (Ala. 2002), the Court vacated a class-certification
1041001
Our holding here is limited to municipal sales taxes.
7
Although the City did not follow the required administrative
procedures before it sued to collect the unpaid business-
25
order by the trial court concerning the collection of those
municipal taxes and stated:
"The [Patterson] Court held that compliance with the
TBOR is the exclusive means for obtaining a
franchise-tax refund, and explicitly stated that
'[t]he TBOR is jurisdictional on its face. See §
40-2A-7(c)(5)c; § 40-2A-9(g)(1).' 835 So. 2d at 153.
See also State v. Amerada Hess Corp., 788 So. 2d 179
(Ala. Civ. App. 2000), in which the Court of Civil
Appeals dismissed an action by the Department to
recover severance taxes on the basis that the trial
court lacked jurisdiction over the action because
the Department had failed to follow the TBOR.
"Because the failure of the City and the County
to comply with the provisions of the TBOR before
filing their complaint deprived the trial court of
jurisdiction, we vacate the class-certification
order and remand the cause for the trial court to
enter an order of dismissal."
894 So. 2d at 656 (quoting Patterson, 835 So. 2d at 153).
The City of Red Bay decision is controlling authority.
As in that case, the circuit court here did not have subject-
matter jurisdiction to adjudicate the sales-tax issue because
the City litigated that dispute without availing itself of the
administrative procedures in the TBOR, which the LTSA made
applicable to the assessment of local sales, use, rental, and
lodgings taxes.   In so holding, we reject the City's argument
7
1041001
license fees and gasoline taxes, the trial court had
jurisdiction to adjudicate the disputes related to the levy of
those taxes.  Municipal business-license fees and gasoline
taxes are not "local sales, use, rental, and lodgings taxes,"
the levies for which the LTSA mandates uniformity in
assessment across the State.       
26
that, because Russell Petroleum paid $36,534.68 in sales taxes
into court and withheld other such taxes, it waived any
objection to the trial court's adjudication of the sales-tax
dispute.  It is axiomatic that, where a court has no
jurisdiction to consider the subject matter of a cause, the
litigants may not confer authority on that court to consider
that matter by their agreement, stipulation, or other conduct.
21 C.J.S. Courts § 84 (2006).
IV. Conclusion 
The requirements in § 11-42-6(b) regarding the boundary-
change map and notice were satisfied as to the Act.
Accordingly, the trial court did not err when it found that
the annexation of the property on which the business is
located was valid.  Although Russell Petroleum was subject to
the City's taxation ordinances following the annexation of the
property into the City, the trial court did not have subject-
matter jurisdiction to order Russell Petroleum to remit
municipal sales taxes because the City did not comply with the
1041001
27
administrative procedures mandated by the TBOR and the LTSA
that apply for the assessment of those taxes before the City
litigated to collect them. Therefore, we affirm the judgment
insofar as it validates the annexation and orders Russell
Petroleum to pay the business-license fees and municipal
gasoline taxes, but we reverse the judgment insofar as it
orders Russell Petroleum to remit sales taxes.  We remand this
cause to the trial court for further action consistent with
this opinion.
AFFIRMED IN PART; REVERSED IN PART; AND REMANDED.
Cobb, C.J., and See, Lyons, Woodall, Stuart, Smith,
Parker, and Murdock, JJ., concur.