Case Title: Department of Revenue and Taxation of State of Wyo. v. Casper Legion Baseball Club, Inc.

Citation: 

Docket Number: 88-185

State: wyoming

Court: Wyoming Supreme Court

Date: 1989-01-11T00:00:00Z

Document:
Department of Revenue and Taxation of State of Wyo. v. Casper Legion Baseball Club, Inc.1989 WY 12767 P.2d 608Case Number: 88-185, 88-186Decided: 01/11/1989Supreme Court of Wyoming
THE 
DEPARTMENT OF REVENUE AND TAXATION OF THE STATE OF WYOMING, APPELLANT 
(PETITIONER),

 
 
v.

 
 
CASPER 
LEGION BASEBALL CLUB, INC. APPELLEE (RESPONDENT). CASPER LEGION BASEBALL CLUB, 
INC. APPELLANT (PETITIONER), v. THE DEPARTMENT OF REVENUE AND TAXATION OF THE 
STATE OF WYOMING, APPELLEE 
(RESPONDENT).

 
 
Appeal from 
the District Court, NatronaCounty, Dan Spangler, 
J.

 
 
Joseph B. 
Meyer, Atty. Gen., Peter J. Mulvaney, Deputy Atty. Gen., Sylvia Lee Hackl, Sr. 
Asst. Atty. Gen., Robert J. Walters, Asst. Atty. Gen., and Milo M. Vukelich, 
Asst. Atty. Gen., Cheyenne, for 
appellant in Case 

 
 
No. 88-185 
and appellee in Case No. 88-186.

 
 
Kenneth R. 
Marken, Casper, for appellee in Case No. 
88-185 and appellant in Case No. 88-186.

 
 
Before THOMAS, URBIGKIT, MACY and GOLDEN, JJ., and 
GUTHRIE, J., Retired.

 
 

GOLDEN, 
Justice.

 
 

[¶1.]     AppellantState of Wyoming Department of Revenue and 
Taxation (Department) appeals a district court decision granting appellee Casper 
Legion Baseball Club, Inc. (Legion) an exemption from state sales taxation. The 
district court's decision reversed the Department's administrative decision 
denying the exemption, but it denied Legion's motion for costs of a transcript 
and filing fees on reversal. The issue presented by the Department is whether 
the Legion is entitled to the exemption as a "charitable" organization under 
W.S. 39-6-405(a)(xiv) (May 1985 Repl.)1 and W.S. 39-6-505(a)(vi) (May 1985 
Repl.)2. Legion cross-appeals requesting an 
award of costs of the transcript and filing fees.

 
 

[¶2.]     We affirm the district 
court in all respects.

 
 

[¶3.]     Legion is a nonprofit 
corporation promoting and financing competitive baseball activities for youth in 
Casper and Glenrock, Wyoming. Any youngster meeting the age and 
jurisdictional requirements set by the National American Legion is eligible to 
try out for Legion teams. The Legion program provides physical, recreational, 
and moral benefits to young people in the two cities. Team members pay no 
registration fee, although they do pay a refundable uniform deposit. Legion 
generates income through private donations, admission charges, various fund 
raising activities, and profits from concession sales at the games. Legion's 
expenses include coaches' salaries, bus driver fees, bus maintenance, umpire 
fees, sundry travel and lodging expenses, and costs of administration and 
organization. Legion is qualified as a federal nonprofit organization exempt 
from federal income taxation.

 
 

[¶4.]     In January 1987, Legion 
applied to the Department for a state sales taxation exemption of its concession 
sales and other fund raising activities involving sales. The Department's 
Manager of the Field Audit Section, Mr. Richard Hubbard, responded by letter. 
Hubbard denied Legion's request for an exemption saying Legion was not the kind 
of organization that qualified for an exemption under Wyoming statutes. Legion 
asked for reconsideration in early February 1987, and Hubbard again responded 
with a denial of Legion's request. Legion then filed an administrative appeal 
with the State Board of Equalization (Board), a hearing body within the 
Department. The Board heard the appeal on September 25, 1987, and affirmed 
Hubbard's decision.

 
 

[¶5.]     Undaunted, Legion filed 
a petition for judicial review of the Board's final administrative decision with 
the District Court, Seventh Judicial District, in Casper, Wyoming, on January 7, 
1988. After reviewing both parties' briefs and the record, the district court 
issued a May 26, 1988, order reversing the Board's decision but denying Legion's 
motion to recover its costs of a transcript and filing fees. The Department 
appealed from the district court's reversal of the Board decision to this court 
on June 6, 1988. Two days later, Legion cross-appealed seeking the above 
mentioned costs. The cases were consolidated for briefing by the clerk of this 
court.

 
 

[¶6.]     We review a district 
court decision concerning an appeal from an administrative contested case by 
reviewing agency findings and conclusions under the statutory standard applied 
by the district court. See Employment Security Commission of Wyoming v. Laramie Cabs, Inc., 700 P.2d 399, 403-404 
(Wyo. 1985). 
In this review we inquire whether agency findings and conclusions were shown to 
be either: 

 
 
(A) 
Arbitrary, capricious, an abuse of discretion or otherwise not in accordance 
with law;

 
 
(B) 
Contrary to constitutional right, power, privilege or 
immunity;

 
 
(C) In 
excess of statutory jurisdiction, authority or limitations or lacking statutory 
right;

 
 
(D) Without 
observance of procedure required by law; or

 
 
(E) 
Unsupported by substantial evidence in a case reviewed on the record of an 
agency hearing provided by statute.

 
 
W.S. 
16-3-114(c)(ii) (October 1982 Repl.). See also W.R.A.P. 12.09 and 
12.11(a).

 
 

[¶7.]     The issue here is 
whether the Department properly interpreted the meaning of "charitable" as used 
in the state taxation exemption statutes. If the Department improperly 
interpreted "charitable," we must review the facts in this record in light of 
the correct statutory interpretation.

 
 

[¶8.]     Involved in this appeal 
are two statutory exemptions from state taxation. The first, W.S. 
39-6-405(a)(xiv), provides for a state sales tax exemption for "[o]ccasional 
sales made by religious or charitable organizations for fund raising purposes 
for the conduct of regular religious or charitable functions and activities * * 
*." See also W.S. 39-6-405(a)(xii) (May 1985 Repl.). The second, W.S. 
39-6-505(a)(vi), provides a state excise tax exemption for "[p]urchases made by 
religious or charitable organizations in the conduct of their regular religious 
or charitable functions." By administrative rule, the Department has also 
adopted a decidedly narrow interpretation of the word "charitable" as it is used 
in these statutes. Pertinent provisions of Department rules provide 
that:

 
 
   (a) Qualified religious or 
charitable organizations are those determined by the State Tax Commission to be 
bona fide associations or corporations organized for and engaged primarily and 
substantially in religious or charitable activities, including worship, 
religious education and assisting poor, aged, disabled and infirm 
persons.

 
 
* * * * * 
*

 
 
     (f) Purchases by civic 
organizations, service clubs and other organizations not organized primarily and 
substantially for charitable or religious purposes are not exempt from the 
tax.

 
 
Rules and 
Regulations of the Wyoming Tax Commission, Department of Revenue 
and Taxation, ch. III, § 57(a) and (f) at 31-32 (July 3, 
1985).

 
 

[¶9.]     The Department argues 
that the plain meaning of the word "charitable," does not extend an exemption to 
Legion because Legion is a private club that promotes its own interests without 
conferring a public benefit. This amounts to a restatement of the Board's 
conclusions of law that, although Legion's stated primary purpose is to foster 
good values and ideals in young people, the way it implements its program does 
not provide a general public 
benefit.

 
 

[¶10.]  The Department ignores the plain language 
of the statute and focuses on the wrong aspect of the function of a charity. 
When interpreting a statute or provision we search for legislative intent. 
Department of Revenue and Taxation of the State of Wyoming v. Hamilton, 743 P.2d 877, 879 (Wyo. 1987). We always begin that search by 
focusing on the language of the legislative enactment, giving that language 
plain and ordinary meaning unless otherwise indicated. Schultz v. State, 751 P.2d 367, 370 (Wyo. 1988); Hamilton, 743 P.2d  at 879; Mahoney v. L.L. Sheep Company, 
79 Wyo. 293, 
333 P.2d 712, 715 (1958).

 
 

[¶11.]  We disagree with the Department's 
interpretation of the statutory language. Black's Law Dictionary defines 
"charitable" as including "every gift for a general public use, to be applied 
consistent with existing laws, for benefit of an indefinite number of persons, 
and designed to benefit them from an educational, religious, moral, physical or 
social standpoint." Black's Law Dictionary 212 (5th ed. 1979) (citing American 
Society for Testing and Materials v. Board of Revision of Taxes, Philadelphia 
County, 423 Pa. 530, 225 A.2d 557, 560 (1967)). Applying the plain meaning of 
"charitable," we find Legion's stated purposes and activities qualify it for the 
state taxation exemptions. Legion is a young persons' baseball organization, 
open to all Casper and Glenrock youth falling within the 
proper age group. Although not all young people who try out make a team, all are given an equal opportunity to do 
so. As a result, Legion provides to young people who try out an annual 
opportunity to receive a positive physical, social, and moral experience through 
competitive sports and fulfills that opportunity for a number of those youth. 
This in turn provides a general public benefit to the Casper and Glenrock areas 
in terms of the physical, social, and moral well-being of the youth in those 
communities. The Department's argument that Legion must provide this experience 
for every youth who tries out does 
not fit within the plain meaning of "charitable" and is overly restrictive and 
unworkable. Taken to its logical end, that argument would require every 
"charitable" youth organization providing a general public benefit to provide 
that benefit to every child within its reach. The "charitable" exemptions would 
be eviscerated by such a restriction.

 
 

[¶12.]  Likewise, we reject the Department's 
attempt to analogize Legion's activities to the activities described in Maxwell 
Memorial Football Club, Inc. v. Commonwealth, 18 Pa.Cmwlth. 464, 336 A.2d 460 
(1975). In Maxwell, the primary activities of the organization seeking a state 
taxation exemption included conducting weekly luncheons featuring speeches by 
individuals involved in collegiate or professional football and awarding an 
annual trophy to an outstanding football player. 336 A.2d  at 462. On appeal from 
the state tax department's denial of tax exempt status as a nonprofit charity, 
the Pennsylvania appellate court held that the 
football club was not a charity for state tax purposes. The appellate court held 
that neither the purpose nor the activities of the organization involved were 
shown to confer in more than an incidental way a general public benefit on youth 
of the community. The football club was basically a private organization 
designed to provide lunchtime entertainment for adults who liked to talk about 
football. Maxwell, 336 A.2d  at 464.

 
 

[¶13.]  Maxwell is factually distinguishable from 
this case. In fact, Legion presents the opposite side of the coin because it is 
an organization that allows all young persons who desire an opportunity to play 
organized baseball the chance to try out for a team. After tryouts, a number of 
youth from the community play organized baseball and learn social, moral, and 
physical values. Legion's purpose and activities confer a direct benefit on the 
general public and any benefit to private individuals in the organization is 
incidental at best. The facts in these two scenarios are completely different 
and the Department's analogy to the holding in Maxwell is 
incorrect.

 
 

[¶14.]  A much better analogy can be drawn 
between Legion and the charity involved in Youth Tennis Foundation v. Tax 
Commission, 554 P.2d 220 (Utah 1976). In that case, the charity involved 
qualified for a state taxation exemption even though it restricted its support 
to a limited number of young people who played tennis in programs and 
tournaments receiving foundation money. The foundation qualified for the 
charitable state taxation exemption because it supplied services and benefits 
directly to young tennis players, and it did so to the public generally without 
regard for race, creed, or economic circumstances. Id. at 
222.

 
 

[¶15.]  In summary, in deciding if an 
organization is eligible for the Wyoming's "charitable" taxation exemptions, the 
Department should focus on whether the charity primarily engages in activities 
providing an indefinite number of persons in the general public with benefits 
designed to aid them in an educational, moral, physical, or social manner. The 
Department should also consider whether the charity provides access to those 
benefits in an equal and nondiscriminatory way. When that standard is applied to 
Legion, the state taxation exemptions must be granted. The district court was 
correct in reversing the Board's decision denying Legion's request for a state 
sales and purchase tax exemption. 

 
 

[¶16.]  Legion does not fare as well in its 
cross-appeal of the district court's denial of costs for a transcript and filing 
fees. Legion argues that a party who appeals a final administrative order to the 
district court and receives a reversal should be able to recover costs as set 
out in W.R.A.P. 10.05, if this court affirms the district court. Legion 
speculates that the basis for the district court's denial of the costs and 
filing fees was that W.R.A.P. 12.01 through 12.12 provides an exclusive body of 
rules for petitions for review of final administrative decisions, and those 
rules do not contain a provision like W.R.A.P. 10.05, providing for costs to a 
petitioner who prevails on appeal from a district court 
reversal.

 
 

[¶17.]  The Department echoes that argument. It 
also argues that Legion failed to cite any authority for its position that 
W.R.A.P. 10.05 is cumulative to W.R.A.P. 12.01 through 12.12 and that the 
doctrine of sovereign immunity prevents the awarding of costs for judicial 
review of an administrative action.

 
 

[¶18.]  Whether the costs described in W.R.A.P. 
10.05 are recoverable in this case is a question of law. We agree with the 
district court that W.R.A.P. 12.01 through 12.12 is the exclusive means of 
seeking judicial review of final administrative action. W.R.A.P. 12.01; and 
Board of CountyCommissioners of TetonCounty 
v. Teton County Youth Services, Inc., 652 P.2d 400, 410 (Wyo. 1982). Those rules 
as adopted by this court, set out specific procedures for obtaining such review 
and incorporate only specific portions of the other W.R.A.P. rules to that end. 
See, e.g., W.R.A.P. 12.10 and 12.11 (incorporating W.R.A.P. 2.12, 4.01 through 
4.09, 5.01 through 5.12, and 6.01 through 6.02). They do not specifically 
incorporate W.R.A.P. 10.05, and they do not otherwise provide for recovery of 
costs in Legion's situation; consequently, Legion cannot recover those 
sums.

 
 

[¶19.]  AFFIRMED.

 
 

GOLDEN, J., 
delivered the opinion of the court.

 
 

GUTHRIE, J., 
Retired, filed a concurring opinion.

 
 
FOOTNOTES

 
 

1 This provision is 
identical to the current codification in (Cum.Supp. 1988).

 
 

2 See supra note 
1.

 
 

GUTHRIE, Retired 
Justice, concurring.

 
 

[¶20.]  I concur in the opinion. I do so with a 
feeling of discomfort and the thought that this ruling is oppressive to the 
Casper Legion Baseball Club when they are denied their costs. However, I cannot 
substitute my personal reactions for what appears to be the 
law.

 
 

[¶21.]  It is both unfair and oppressive to force 
an aggrieved party to pay its own costs to secure a review and correction of an 
erroneous ruling by pursuing its appeal through both the trial court and this 
court. The trial court found this ruling arbitrary and capricious and we, by 
this affirmation, approve that ruling. Even a taxpayer is entitled to some 
protection from oppressive administrative action.

 
 

[¶22.]  This is a matter which the rule-making 
power should forthwith consider and correct.