Case Title: Maverick Motorsports Group, LLC v. Dept. of Revenue, State of Wyoming

Citation: 

Docket Number: S-10-0220

State: wyoming

Court: Wyoming Supreme Court

Date: 2011-05-03T00:00:00Z

Document:
MAVERICK MOTORSPORTS GROUP, LLC v. DEPARTMENT OF REVENUE, STATE OF WYOMING2011 WY 76Case Number: No. S-10-0220Decided: 05/03/2011NOTICE: This opinion is subject to formal revision before publication in Pacific Reporter Third. Readers are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming 82002, of any typographical or other formal errors so correction may be made before final publication in the permanent volume.
APRIL 
TERM, A.D. 2011

 
 

MAVERICK 
MOTORSPORTS GROUP, LLC,Appellant (Petitioner),v.DEPARTMENT 
OF REVENUE, STATE OF WYOMING,Appellee(Respondent).

 
 

Appeal 
from the District Court of Laramie County

The 
Honorable Michael K. Davis, Judge

 
 
Representing 
Appellant:

John 
M. Kuker and James M. Peterson of Romsa & Kuker, LLC, Cheyenne, 
Wyoming.  Argument by 
Mr. Kuker.

 
 

Representing 
Appellee:

Bruce 
A. Salzburg, Wyoming Attorney General; Michael L. Hubbard, Deputy Attorney 
General; Martin L. Hardsocg, Senior Assistant Attorney General; and William F. 
Russell, Senior Assistant Attorney General.  Argument by Mr. 
Russell.

 
 
Before 
KITE, C.J., and GOLDEN, HILL, VOIGT, JJ., and PARK, 
D.J.

 
 
PARK, 
District Judge.

 
 
[¶1]      This is a case 
about whether a Wyoming dealer must pay sales tax on sales of recreational 
vehicles to out-of-state buyers.  The Appellant, Maverick Motorsports 
Group, LLC (hereinafter "Maverick"), challenges a decision of the State Board of 
Equalization (hereinafter "SBOE") that certain sales by Maverick were subject to 
Wyoming sales tax.  Maverick 
petitioned for judicial review, and the District Court affirmed the SBOE's 
decision.  In this appeal, Maverick 
challenges the SBOE's decision which held that sales by Maverick were subject to 
Wyoming sales tax and that imposition of Wyoming sales tax did not violate Art. 
1, § 8, of the United States Constitution (the Commerce 
Clause).

 
 
[¶2]      We affirm the 
SBOE's decision.

 
 
 

 
 
[¶3]      The following 
issues are presented on appeal:

 
 
            
I.          
Whether sales of recreational vehicles were taxable in Wyoming because 
possession was transferred in Wyoming.  

 
 
            
II.         
Whether enforcement and collection of Wyoming sales taxes violate the 
Commerce Clause, Art. 1, § 8, of the United States 
Constitution.

 
 
 
 

 
 
[¶4]      Maverick was 
formed in 2005 to purchase the assets of an existing business.  Justin Johnson (hereinafter "Johnson") is 
the company president.  Maverick 
operates stores in Cheyenne and Laramie, Wyoming.  Both stores had sales tax licenses and 
both sold motorcycles, all-terrain vehicles (ATVs), snowmobiles, and various 
accessories.  The parties agree that 
many of Maverick's customers lived in other states.  Johnson had been informed by the previous 
owner that no Wyoming sales tax would be due for sales to nonresidents if the 
invoices were marked "delivered out of state"; so Maverick marked invoices in 
that manner and did not collect Wyoming sales tax.  The Department of Revenue (hereinafter 
"Department") conducted audits of both stores for the period including June 2005 
through September 2006.  The 
Department concluded that sales tax was due from both stores.  Maverick objected to both audits, and 
these objections were consolidated into one hearing before the SBOE.  Maverick and the Department continued to 
work together up to the date of the hearing and came to an agreement on several 
issues.  By the time of the hearing, 
the only issues were whether Wyoming could collect sales tax on sales of 
recreational vehicles to nonresidents; and, if so, did this tax violate the 
Commerce Clause.    

 
 
[¶5]      The vehicles were 
transferred in three ways:  most 
were picked up by the purchaser at one of the stores, some were delivered by a 
common carrier selected by the purchaser, and some were delivered by Maverick. 
 Maverick would mail any documents 
necessary to title or register the vehicle to the buyer a few weeks after the 
sale.  These documents were 
retained, in part, to ensure that the buyer's check would clear the bank.  In some cases, the documents were mailed 
to the buyer's financier.     

 
 
[¶6]      The SBOE's 
primary concern about vehicles delivered by Maverick was a lack of 
documentation.  The SBOE, although 
critical of Maverick's recordkeeping, agreed that Maverick had provided adequate 
proof and ruled that most of these sales were "destination sales" where transfer 
of title or possession took place outside Wyoming and no sales tax was due.  The Department did not appeal this 
ruling.  In addition, there were 
some instances where Maverick had no documentation to prove how the vehicle was 
delivered, and the SBOE affirmed the Department's finding.  Maverick did not appeal from this part of 
the SBOE's decision.

 
 
[¶7]      The majority of 
the sales involved customers who came to one of the stores, picked up the 
vehicle and then returned to their home state with the purchase.  Maverick refers to these as 
"self-deliveries."  Maverick 
asserted that the parties intended to transfer possession in the buyer's home 
state; the Department countered that the record did not support this 
assertion.   

 
 
[¶8]      In some sales, 
Johnson testified that Maverick would recommend a common carrier to the buyer, 
and then the buyer would contract directly with the carrier.  The SBOE found that delivery to the 
carrier was the equivalent of delivery to the buyer and that there was no 
contract or other evidence that the parties intended that Maverick would be 
responsible for the goods until delivery was complete.    

[¶9]      Maverick and the 
Department entered into a stipulation that Maverick did not have to contact any 
of its customers to obtain documentation that the customer had paid sales or use 
tax in another state.  The 
Department agreed to this because it asserted that its only contention was that 
the State of Wyoming was entitled to the tax.    

 
 
[¶10]   The SBOE found that possession of 
the vehicles was transferred to the 
buyer in Wyoming; therefore, Wyoming sales tax was due.  In general terms, the question before 
the Court is whether the SBOE's decision is supported by substantial evidence 
and not arbitrary or capricious, or otherwise contrary to 
law.

 
 
 
 
 
 
 
 
STANDARD 
OF REVIEW

 
 
[¶11]   Our standard of review is 
well-established.  We give "no special deference to the district court's 
decision" in considering appeals from district court reviews of administrative 
actions, but instead review the case as if it had come directly from the 
administrative agency.  Dale v. S & S Builders, LLC, 2008 
WY 84, ¶ 8, 188 P.3d 554, 557 (Wyo. 2008).  Reviews of an administrative agency's action are 
governed by the Wyoming Administrative Procedure Act, which provides in 
pertinent part that the reviewing court shall:

 
 

(i) 
Compel agency action unlawfully withheld or unreasonably delayed; 
and

(ii) 
Hold unlawful and set aside agency action, findings and conclusions found to 
be:

            
(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.

 
 

Wyo. 
Stat. Ann. § 16-3-114(c) (LexisNexis 2009).

 
 
[¶12]   Questions of law are reviewed de novo, and 
"[c]onclusions of law made by an administrative agency are affirmed only if 
they are in accord with the law.  We 
do not afford any deference to the agency's determination, and we will correct 
any error made by the agency in either interpreting or applying the law.'" 
 Bowen v. State, Dep't of 
Transp., 2011 WY 1, ¶ 7, 
245 P.3d 827, 829 (Wyo. 2011) (quoting State ex rel. Workers' Safety & Comp. 
Div. v. Garl, 2001 WY 59, ¶ 9, 26 P.3d 1029, 1032 (Wyo. 2001)).  

 
 
[¶13]   We give "considerable deference" to the agency's findings of fact and 
do not disturb them unless they are "contrary to the overwhelming weight of the 
evidence."  EOG Resources, Inc. v. Wyo. Dep't of Revenue, 2004 
WY 35, ¶ 12, 86 P.3d 1280, 1284 (Wyo. 2004).  This Court reviews the entire record of 
an agency's decision for substantial evidence, and it will determine if there is 
relevant evidence that a reasonable mind might accept in support of the agency's 
decision.  Herrera v. State ex rel., Wyo. Workers' 
Safety & Comp. Div., 2010 WY 103, ¶ 9, 236 P.3d 277, 281 (Wyo. 
2010).  

[¶14]   The scope of our review is 
controlled by Wyo. Stat. Ann. § 39-11-109 and § 16-3-115.  Section 39-11-109(b)1 
provides:

 
 
(i) 
Any person aggrieved by any final administrative decision of the department may 
appeal to the board.  Appeals shall 
be made in a timely manner as provided by rules and regulations of the board by 
filing with the board a notice of appeal specifying the grounds therefor.  The department shall, within a timely 
manner as specified by board rules and regulations, transmit to the board the 
complete record of the action from which the appeal is 
taken;

(ii) 
Any person including the state of Wyoming aggrieved by any order issued by the 
board, or any county board of equalization whose decision has been reversed or 
modified by the state board of equalization, may appeal the decision of the 
board to the district court of the county in which the property or some part 
thereof is situated[.]

 
 
Section 
16-3-115 provides for Supreme Court review of the 
district court:

 
 

            
An aggrieved party may obtain a review of any final judgment of the 
district court under this act by appeal to the supreme court. The appeal shall 
be taken as in other civil cases.

            

 

 
 
 
 
1.  Was sales tax due in 
Wyoming?

 
 
[¶15]   There are two types of sales at 
issue.  The first includes sales in 
which out-of-state buyers would pick up a vehicle from Maverick at either the 
Cheyenne or Laramie store and return with the vehicle to their home state.  The second includes sales in which a 
common carrier, acting on behalf of the out-of-state buyer, would pick up the 
vehicle from Maverick and deliver it out of state.  Maverick contends that these sales 
were "non-taxable destination" sales and not subject to Wyoming sales tax.  The Department responds that the buyers 
took possession in Wyoming; therefore, sales tax is due.  The SBOE agreed with the Department, and 
the record supports the SBOE's decision.

 
 
[¶16]   Prior to January 1, 2008, and 
during the time at issue here, "sale" was defined as "any transfer of title or 
possession in this state for consideration. . . ."  Wyo. Stat. Ann. § 39-15-101(a)(vii) 
(LexisNexis 2005).   After 
January 1, 2008, "sale" was defined as "any transfer of possession in this state 
for a consideration . . . ."  2006 
Wyo. Sess. Laws, Chap. 10, § 1.  The 
issue in this case is whether transfer of possession or title took place in 
Wyoming or outside the state.  Sales 
tax is imposed on "[t]he sales price of every retail sale of tangible personal 
property within the state."  Wyo. 
Stat. Ann. § 39-15-103(a)(i)(A).  Sellers are required to collect and remit 
to the state the taxes imposed on sales of motorcycles and off-road vehicles. 
 Wyo. Stat. Ann. § 39-15-107(a)(i) 
and (b)(viii).

 
 
[¶17]   The Wyoming Sales and Use Tax 
Regulations in effect at the relevant time, provided as 
follows:

 
 
(q)  Interstate Sales.

            
(i)  The point at which title 
or possession of tangible personal property passes to the purchaser shall 
determine the location of the sale. Tangible personal property shipped by the 
vendor at the time of sale and not used in Wyoming, to an out of state location 
may be considered a destination sale and not subject to the sales 
tax.

. 
. . .

            
(iii)  Contracts of sale, 
sales invoices, bills of lading or other documentary evidence of the passage of 
title or delivery of tangible personal property to the purchaser inside or 
outside this state shall be retained by the vendor to establish the nature of 
the sale. If no such evidence is present, it shall be presumed that the sale 
occurred within the state and the vendor shall be liable for the sales tax 
thereon.

 
 
Wyoming 
Sales and Use Tax Regulations, Ch. 2, Sec. 15 (2004).  

 
 
[¶18]   Maverick argues that these were 
nontaxable destination sales because neither title nor possession was 
transferred in Wyoming.  Maverick 
contends that the sale documents show that the parties intended for change of 
possession to happen in the buyer's home state and the buyer had only 
constructive possession until the vehicle actually arrived at the buyer's 
residence either because delivery was made by a third party, a common carrier, 
or because the customer was acting as his/her own delivery agent.  Maverick's point is that because the 
parties intended this transfer would take place outside of Wyoming, the transfer 
of "actual possession" did not happen in Wyoming, and the transfer of the title 
to the vehicles also occurred outside Wyoming when the mailed title documents 
were received by the buyer.  

 
 
 
 
[¶19]   The first assertion Maverick makes 
is that the invoices reflect the intent of both parties and they intended for 
transfer to occur in the buyer's home state.  Maverick relies on Hercules Powder Co. v. State Bd. of 
Equalization, 208 P.2d 
1096, reh'g 
denied, 66 Wyo. 268, 210 P.2d 824 (Wyo. 1949).  As explained in Buehner Block Co., Inc. v. Wyo. Dep't of 
Revenue, 2006 WY 90, ¶ 23, 
139 P.3d 1150, 1158-1159 (Wyo. 2006), "Hercules 
Powder was a Delaware corporation, with offices in Salt Lake City, Utah, and 
Denver, Colorado, and little or no physical presence in Wyoming." 
 Id., Hercules, 208 P.2d at 1097.  Hercules was engaged in the manufacture 
and sales of "explosives and incidental materials" 
and "sometimes took mail orders, from inside or outside Wyoming, for its 
products to be delivered to destination points within Wyoming."  Id., Hurcules, 208 P.2d at 1097-1100.  "This Court concluded [in Hercules] that the sales at issue in 
that case were not subject to Wyoming sales tax statutes because the straight 
bills of lading under which the goods were shipped acted to transfer title to 
the goods to the consignees immediately upon shipment thereunder."  Buehner, ¶ 23, 139 P.3d  at 1159.  The Court also relied 
upon the agency's own prior interpretation of the statutes as an alternative 
ground for decision.  Hercules, 208 P.2d  at 1110-12.  The SBOE in this case properly 
interpreted Hercules as stating that 
the general rule that title passes at the point of shipment controls unless the 
circumstances clearly demonstrate a contrary intent.  

 
 
[¶20]   The principles enunciated in Hercules are reflected in the Wyoming 
Uniform Commercial Code, Wyo. Stat. Ann. § 34.1-2-401.  The SBOE relied upon the U.C.C. to 
determine that title passed to the buyer when the vehicle was physically 
delivered to the buyer or the buyer's agent.  Wyo. Stat. Ann. § 34.1-2-401 provides in 
pertinent part:

 
 
(a) 
Each provision of this article with regard to the rights, obligations and 
remedies of the seller, the buyer, purchasers or other third parties applies 
irrespective of title to the goods except where the provision refers to such 
title. Insofar as situations are not covered by the other provisions of this 
article and matters concerning title become material the following rules 
apply:

                                    
. . . .

            
(ii)  Unless otherwise 
explicitly agreed title passes to the buyer at the time and place at which the 
seller completes his performance with reference to the physical delivery of the 
goods, despite any reservation of a security interest and even though a document 
of title is to be delivered at a different time or place; and in particular and 
despite any reservation of a security interest by the bill of 
lading:

            
     (A) If 
the contract requires or authorizes the seller to send the goods to the buyer 
but does not require him to deliver them at destination, title passes to the 
buyer at the time and place of shipment; but

            
     (B) If 
the contract requires delivery at destination, title passes on tender 
there.

 
 
[¶21]   Maverick first argues that it was 
improper for the SBOE to rely on the Wyoming U.C.C. statute because the comment 
to this section precludes reliance on the U.C.C. for regulatory purposes.  Maverick then argues that if this statute 
is considered, it supports Maverick's argument because there was an explicit 
agreement that title would pass upon tender at the final destination.  The comment to this section of the U.C.C. 
provides:

 
 
            
1. This Article deals with the issues between seller and buyer in terms 
of step by step performance or non-performance under the contract for sale and 
not in terms of whether or not "title" to the goods has passed. That the rules 
of this section in no way alter the rights of either the buyer, seller or third 
parties declared elsewhere in the Article is made clear by the preamble of this 
section. This section, however, in no way intends to indicate which line of 
interpretation should be followed in cases where the applicability of "public" 
regulation depends upon a "sale" or upon location of "title" without further 
definition. The basic policy of this Article that known purpose and reason 
should govern interpretation cannot extend beyond the scope of its own 
provisions. It is therefore necessary to state what a "sale" is and when title 
passes under this Article in case the courts deem any public regulation to 
incorporate the defined term of the "private" law.

            

[¶22]   The question of whether it is 
appropriate to consider the U.C.C. when determining questions of tax regulation 
has not been directly addressed in Wyoming.  We now find that it was appropriate for 
the SBOE to rely on the U.C.C. as an objective test to determine when title 
passed.  As noted by the district 
court, there is some historical basis for this.  The opinion in Hercules relied, in part, on provisions 
of the Uniform Sales Act, which was the predecessor to the U.C.C.  Hercules, 208 P.2d  at 1103.  See also, Wyo. Stat. Ann. § 34.1-1-102 
(recognizing the Uniform Sales Act as one of the prior statutory schemes 
incorporated by the U.C.C.).  Other 
jurisdictions have relied on the U.C.C. for assistance in resolving tax 
questions.  A typical analysis is 
that of the Rhode Island Supreme Court:  

 
 

While 
we have some doubts whether the regulations make reference to the Code as that 
body of contract law which should apply when applicable, we can perceive 
no reason 
why, when a question arises under the regulations as to contract interpretation, 
we should not employ the Code as our frame of reference. In doing so, we adhere 
to the current realities of the marketplace and will, therefore, be better able 
to gauge the parties' intent in those instances where intent is decisive under 
the regulations. 

 
 

Rice 
Machinery, Inc. v. Norberg, 
391 A.2d 66, 72 (R.I. 1978).

 
 
[¶23]   Other jurisdictions applying the 
U.C.C. to resolve tax issues include:  
O'Brien v. 
Isaacs, 203 N.E.2d 890, 
891 (Ill. 1965); Continental 
Illinois Leasing Corp. v. Dep't of Revenue of State of Ill., 439 N.E.2d 118, 
121 (Ill. App. Ct. 1982) ("To determine when, for taxation purposes, ownership 
of or title to property is transferred, Illinois courts have applied the title 
passing tests of the Uniform Commercial Code."); H.O. Anderson, Inc. v. Rose, 352 S.E.2d 541, 548 (W. Va. 1986) ("We find the 
provisions of the Uniform Commercial Code (U.C.C.) instructive in determining the passage of title in tax 
cases . . . ."); New England Yacht Sales, Inc. v. Comm'r of 
Revenue Servs., 504 A.2d 506, 509-510 (Conn. 1986); Circuit City Stores, Inc. v. Comm'r of 
Revenue, 790 N.E.2d 636, 640 (Mass. 2003) ("Our tax statutes provide no 
explicit definition of the term title,' and so we look for guidance to the 
Uniform Commercial Code . . .").  See also Crown Iron Works Co. v. Comm'r of 
Taxation, 214 
N.W.2d 462 (Minn. 
1974); City of Richmond v. Petroleum Marketers, 
Inc., 269 S.E.2d 389, 390 (Va. 1980); Franklin Fibre-Lamitex Corp. v. Director of 
Revenue, 505 A.2d 1296, 1299 (Del. Super. Ct. 
1985).

 
 

[¶24]   Maverick then asserts that even if 
the SBOE could use the U.C.C., the SBOE decision was still wrong because the 
parties had an express agreement that title would pass when the vehicle reached 
the buyer's home state.  The 
SBOE found that the sale documents did not determine the point of transfer.  We agree.  The statement on the invoices, "delivered 
out of state," is not sufficient to overcome the fact that actual possession was 
transferred in Wyoming at the time of pick-up.  The parties could have but did not use 
other language in the invoice to suggest that the transfer of possession would 
occur in another location, such as clauses dealing with risk of loss or 
responsibility for selection of carriers; this wording was missing from the 
invoices.  In addition, the reverse 
side of the invoices contained the following paragraph:

 
 
We 
are not liable for failure to deliver or delay in delivery of the purchased 
vehicle. If the failure or delay is due, in whole or part, to any cause beyond 
our control or without our fault or negligence, we are not liable to you for any 
consequential damages, damages to property, damage or loss of use, loss of time, 
loss of profits or income, or any other incidental damages arising out of the 
sale or use of the purchased vehicle.

 
 
 
 
An 
objective analysis indicates that transfer of possession occurred in Wyoming. 
 The record supports the SBOE's 
findings. 

 
 
[¶25]   Maverick contends that title was 
transferred to the buyer when the certificate of title or the manufacturer's 
statement of origin (MSO) was mailed to the buyer or the buyer's lender some 
weeks after the sale.  Maverick uses 
the term "title" to mean the written documents that prove ownership.  Wyoming has long recognized that "title" 
has a broader definition.  Brown v. 
Wintermute, 139 P.2d 435, 
438 (Wyo. 1943) ("A party may have a title to property although he is not 
the absolute owner.'") (quoting Roberts 
v. Wentworth, 59 Mass. 192, 5 Cush. 192 (Mass. 1849)).  The statute uses the term 
"title" in a more general sense, 
and the statutory use of the 
term "title" means 
"[t]he union of 
all elements (as ownership, 
possession, and custody) constituting the legal right to control and dispose of 
property.'"  McAlpine v. Zangara 
Dodge, Inc., 183 P.3d 975, 
977-978 (N.M. Ct. App. 2008) (quoting Black's Law 
Dictionary 1522 (8th ed. 
2004)).  "Title" to a vehicle may be 
transferred, or passed, even though there is a failure to comply with code 
provisions concerning the certificate of title. State v. Montano, 601 P.2d 69, 
74 (N.M. Ct. App. 1979). 
 The question is not 
when the buyer received his paperwork, but when he became the owner of the 
vehicle.

            

[¶26]   A majority of the transactions at 
issue involved out-of-state buyers who would come to either the Cheyenne or 
Laramie store, pick up the vehicle, and return to their home state.  Maverick argues that those customers who 
picked up their vehicles were acting as their own agent and only had 
constructive possession for delivery purposes; therefore, possession did not 
transfer from the seller to the buyer until the buyer arrived home.  Maverick relies almost entirely on State ex rel. Wyo. Dep't of Revenue v. Union 
Pacific R.R. Co., 2003 WY 54, 67 P.3d 1176 (Wyo. 2003), to support the 
interesting argument that a person can be his own agent and have only 
constructive possession of an item that he controls.  Reliance on the Union Pacific case in this instance is 
misplaced.  

 
 
[¶27]   Union Pacific involved a case where the 
Department assessed tax on ballast used by the Union Pacific (UP).  Some of the ballast was used by the UP in 
Wyoming and some was used in other states, but it was delivered to the UP for 
transportation to the out-of-state construction sites.  The ballast used out of state was subject 
to inspection in the state to which it was delivered.  The SBOE found that tax was due on the 
ballast used in Wyoming (the "maintenance ballast") but not on the ballast used 
outside the state (the "construction ballast").  We affirmed, finding that the UP obtained 
complete control of the maintenance ballast because it was accepted without 
reservation.  However, the 
construction ballast was transferred as a non-taxable destination sale because 
the purchaser retained the right to reject it, in which case, the ballast was 
returned at the seller's expense.  Union Pacific, ¶¶ 14-15, 67 P.3d  at 
1183.  We also specifically noted 
that the UP was the agent for the vendor.  Id.  There is nothing in the opinion to 
suggest that this Court found that the UP was acting as its own 
agent.

 
 
[¶28]   The contention that a person can 
act as his own agent presents several practical problems and is contrary to 
established law.  A relationship of agency 
is established when two parties agree that one, the agent, shall act on behalf 
of and subject to the control of the other, the principal.  The first section of the Restatement of 
Agency Law explains that an agent and a principal are different persons.  Restatement (Third) of Agency Law § 
1.01 (2006) states that "Agency' is the fiduciary 
relationship that arises when one person (a principal') manifests assent to 
another person (an agent') that the agent shall act on the principal's behalf 
and subject to the principal's control, and the agent manifests assent or 
otherwise consents so to act."  This contemplates different entities for 
agent and principal.  Franks v. Independent Prod. Co., Inc., 
2004 WY 97, ¶ 11, 96 P.3d 484, 490 
(Wyo. 2004) ("Agency is a fiduciary relation which results from the 
manifestation of consent by one person to another that the other shall act on 
his behalf and subject to his control and consent.'") (quoting True v. Hi-Plains Elevator Machinery, 
Inc., 577 P.2d 991, 999 (Wyo. 1978)).   

 
 
[¶29]   Furthermore, there is no logic to 
the assertion that a person in actual control of an object has only 
"constructive possession."  This 
term has often been used in the context of criminal cases and has a well-defined 
meaning:  "A person who, although not in actual possession, 
knowingly has both the power and the intention, at a given time, to exercise 
dominion or control over a thing, either directly or through another person, is 
in constructive possession of it."  Dettloff v. State, 2007 WY 29, ¶ 31, 152 P.3d 376, 384 (Wyo. 2007) (emphasis added).  This definition is just as appropriate 
here.  We do not accept the argument 
that a person may act as his or her own agent, and we hold that a customer who 
picked up a vehicle in Wyoming had actual possession at the time of 
pick-up.  2 Hellerstein & Hellerstein ¶ 
18.02(2)(e), 18-14 (2010).  The 
sale therefore occurred in Wyoming and was properly taxed.

 
 
[¶30]   The remaining transactions are 
those where delivery was made by a third-party carrier.  The evidence was that Maverick might 
recommend a carrier; however, the customer ultimately chooses the carrier, and 
the contract is between the carrier and the customer.  Under these facts, the carrier would be 
the agent of the buyer; and when possession was transferred to the carrier in 
Wyoming, sales tax was due.  2 Hellerstein & Hellerstein ¶ 
18.01(2)(b), 18-9 (2010).

 
 
[¶31]   A review of the record indicates 
that substantial evidence supports the SBOE's finding that transfer of 
possession and title of these vehicles occurred in Wyoming, and the levy of a 
sales tax on these transactions is appropriate.

 
 
 
 
2.  Was collection of sales tax by Wyoming 
unconstitutional?

 
 
[¶32]   Maverick argues that collection of 
a sales tax on these vehicle transactions violates the Commerce Clause, Art. 1, 
§ 8, of the United States Constitution.  First, Maverick asserts that a Wyoming 
tax discriminates against or unduly burdens interstate commerce; and, second, 
unless Maverick is allowed a credit for sales or use taxes paid in other states, 
there is an unconstitutional multiple taxation of a single 
transaction.

[¶33]   The 
Commerce Clause gives Congress the power to regulate commerce among the several 
states.  The framers of the Constitution intended 
to encourage free trade among the several states, to minimize restriction of the 
flow of commerce among the states, to protect commercial interactions from 
odious restraint, and to preclude interference through inconsistent or hostile 
state laws.  Oregon Waste Systems, Inc. v. Dep't of 
Envtl. Quality of State of Or., 511 U.S. 93, 98-99, 114 S. Ct. 1345, 1349, 128 L. Ed. 2d 13 (1994).  The framers also intended 
to prohibit one state from exacting more than its just share of revenue from 
interstate commerce than would be proportionate with the burden imposed within 
that state by the commercial action.  Id.  

[¶34]   "The modern law of what 
has come to be called the dormant Commerce Clause is driven by concern about 
economic protectionism-that is, regulatory measures designed to benefit 
in-state economic interests by burdening out-of-state 
competitors.'"  
Dep't of Revenue of 
Kentucky v. Davis, 553 U.S. 328, 337-338, 
128 S. Ct. 1801, 1808, 170 L. Ed. 2d 685 (2008).  "[(T)he] very purpose of the Commerce 
Clause was to create an area of free trade among the several 
States."  
Boston Stock Exchange v. 
State Tax Comm'n, 429 U.S. 318, 328, 
97 S. Ct. 599, 606, 50 L. Ed. 2d 514 (1977) (quoting McLeod v. J. E. Dilworth Co., 322 U.S. 327, 330 (1944)).  The Commerce 
Clause not only authorized Congress to enact laws to protect and encourage 
commerce among the States, but it also created "an area of trade free from 
interference by the States. . . . (T)he Commerce Clause even without 
implementing legislation by Congress is a limitation upon the power of the 
States.'"  Id.   (quoting Freeman v. 
Hewit, 329 U.S. 249, 252 
(1946)).  A state may not tax 
interstate transactions more heavily than intrastate transactions.  Chemical Waste Management, Inc. v. 
Hunt, 504 U.S. 334, 342, 112 S. Ct. 2009, 2014, 119 L. Ed. 2d 121 (1992). 
 "Once a state tax is found to 
discriminate against out-of-state commerce, it is typically struck down without 
further inquiry."  Id.

 
 
[¶35]   In Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 279, 97 S. Ct. 1076, 
1079, 51 L. Ed. 2d 326 (1977), the U.S. Supreme Court imposed a test to 
aid courts in deciding this question of possible discrimination.  Complete 
Auto involved a carrier which transported automobiles manufactured 
outside the state of Mississippi to dealers in that state.  The carrier sought a refund of a sales 
tax imposed by Mississippi on those deliveries.  The Court noted that the purpose of the 
Commerce Clause was not to relieve those engaged in interstate commerce of their 
just share of the state tax burden. Complete Auto, 430 U.S.  at 279, 97 S. Ct. 
at 1079.  The Court upheld the 
Mississippi tax using what has now become known as the "Complete Auto 
four-prong test."  The test is used 
to determine whether a state tax violates the Commerce Clause, and it overruled 
the previously more formal and ritualistic view. Instead, the Court, referencing 
the more pragmatic approach, noted:

 
 
These 
decisions have considered not the formal language of the tax statute but rather 
its practical effect, and have sustained a tax against Commerce Clause challenge 
when the tax [1] is applied to an activity with a substantial nexus with the 
taxing State, [2] is fairly apportioned, [3] does not discriminate against 
interstate commerce, and [4] is fairly related to the services provided by the 
State.  

 
 

Id.

 
 
[¶36]   In Okla. Tax Comm'n v. Jefferson Lines, Inc., 
514 U.S. 175, 115 S. Ct. 1331, 131 L. Ed. 2d 261 (1995), the U.S. Supreme Court 
held that a state had the power to impose a tax on the unapportioned gross 
receipts from the sales of bus tickets purchased in Oklahoma for trips with an 
out-of-state destination.  The issue 
was whether the tax should be apportioned because the trip passed through other 
states.  The Court applied the 
four-pronged Complete Auto test.  Id 
at 183, 115 S. Ct.  at 1337.  The 
Court held that apportionment was not necessary.  The Court found that there was no 
possibility of duplicate taxation by other jurisdictions that would levy the 
same type of tax since the Oklahoma tax was only imposed on sales made in that 
state; therefore, the tax had internal consistency.  Id 
at 185, 115 S. Ct.  at 1338.  The 
Court also examined external consistency, which "looks not to the logical 
consequences . . . but to the economic justification . . . to discover whether a 
State's tax reaches beyond that portion of value that is fairly attributable to 
the economic activity within the taxing State."  Id.  The Court indicated that although some 
state taxes must be apportioned in order to satisfy the Commerce Clause, this 
apportionment is not required in cases involving sales taxes.   Id. at 186-88, 115 S. Ct.  at 
1338-40.  A sale subject to sales 
tax is a discrete transaction, and the Court had consistently approved taxation 
of sales, without any allocation between the states.  Id. at 186-87, 115 S. Ct.  at 1339.  As to the final two prongs of the test, 
the Court held that a tax was not discriminatory unless it provided a direct 
"commercial advantage" to local businesses.  Id. at 197, 115 S. Ct.  at 1344.  The Oklahoma tax passed muster because 
it was levied on both interstate and intrastate sales.  Id 
at 199, 115 S. Ct.  at 1345.  The 
last factor requires a "fair relation" between the tax and the benefits 
conferred by the state.  The Court 
ruled that the state was not required to provide a "detailed accounting" and 
that interstate commerce could be required to pay its share and to contribute to 
the cost of government.  Id.  

 
 
[¶37]   When the Complete Auto analysis is applied to this case, 
the tax imposed on Maverick sales meets constitutional requirements.  The sale in Wyoming is a discrete event; 
and under Jefferson, the sales tax is 
appropriate regardless of any subsequent out-of-state use.  Since it is a sales tax imposed on a 
single discrete transaction, apportionment is not required.  There is no discrimination; the tax is 
imposed equally on resident and nonresident buyers.  Finally, the relationship between the tax 
and governmental services, as noted, does not require a detailed comparison of 
the tax relative to the public services provided.  It is sufficient that the event is 
taxable and, therefore, the taxes may be used for services even if they are not 
related to the taxable event.

 
 
[¶38]   Maverick argues that if Maverick is 
not given a credit for use taxes paid in other states, then multiple taxes are 
imposed on a single transaction, contrary to constitutional principles.  The parties stipulated, prior to the 
hearing before the SBOE, that Maverick was not required to prove that its 
customers had paid a sales or use tax in their home states because the 
Department was not contesting the payment of this tax.  The Department indicated that it had 
entered into this stipulation because the only issue was whether the tax was due 
in Wyoming; therefore, payment of taxes in other states was not relevant. 
Maverick asserts that Wyoming should recognize that sales or use taxes may have 
been paid in the purchaser's home state, and that collection of the tax by 
Wyoming violates the holding of Jefferson. 

 
 
[¶39]   Maverick falls short with its 
argument that it is entitled to a credit for taxes paid in other states.  Maverick fails to recognize that this is 
not an issue of an imposition of a tax; rather, the issue is a question of 
whether a sales tax, properly imposed, may be enforced and collected.  Maverick had the obligation to collect 
the tax at the time of the sale.  It 
did not do so, relying solely on statements from the previous owner that were 
contrary to law. Maverick officials conceded that they did no independent 
investigation or otherwise attempt to determine their tax obligations.  As a result, the sales taxes were not 
collected because Maverick incorrectly believed that they were not due.  This is not a basis for allowing Maverick 
any tax credit for taxes subsequently paid in other 
states.

 
 
[¶40]   The District of Columbia and 44 of 
the 45 states that levy sales and use taxes allow a credit or exemption for 
similar taxes paid other states.  Jefferson, 514 U.S.  at 194, 115 S. Ct.  at 1343, 2 Hellerstein & Hellerstein, ¶ 
18.08, 18-100 (2010).  However, as 
explained in Jefferson, these credit 
provisions create a national system under which the first state of purchase 
imposes the tax.  Id.  Wyoming is the first state of 
purchase, so it is entitled to impose the tax, and other states should allow a 
credit for the Wyoming tax.  Maverick had a statutory obligation to 
collect the sales tax; and if it had done so, there would be a strong argument 
that the buyer's home state would be required to grant a credit for the sales 
tax.  To the extent that it may 
prove difficult or even impossible for Maverick to obtain the credit from these 
other states or from its customers, these difficulties are solely the result of 
its own actions. 

 
 
[¶41]   We affirm the actions of the SBOE 
in determining that the purchase of the various recreational vehicles at issue 
in this case constitutes a taxable event in Wyoming.  We also agree with the SBOE that 
collection of sales taxes on these vehicles does not violate the U.S. 
Constitution, Art. 1, § 8, (the Commerce Clause).

 
 
FOOTNOTES

 
 

1Amended, in other parts, by 2011 Wyo. Laws, Ch. 127 (H.B. 254).