December 13, 1951

Hon. Bill TiDDen Oninion No. V-1375 County Attorney Taylor County Abilene. Texas Re:

Dear Mr. Tippen: Constitutionality of subsection (c) of Sec. 5a, Art. 7047k, V.C.S., as amended, requiring seller and purchaser to make ajoint affidavit of the true consideration and rcquiring the tax assessor-collector to refuse mot& vehicle registration applications from any seller who owes ‘affidavit error fees.”
You submit for the opinion of this office the question of the constitutionality of Subsection 4 of Section VII (Motor Vehicle Sales Tax) of House Bill 285, Acts 52nd Leg., R,S. 1951, ch. 402, p, 695. Subsection 4 of this act amends Section 5a of Article 7047k, V.C.S., to read in part as follows:

“Section 4a, The purchaser and seller shall make ajoint affidavit setting forth the then value in dollars of the total consideration, whether in money or other things of value, received or to be received by the seller or his nominee in a retail sale,

. . .

..

. . .

“(b) Where the joint affidavit incorrectly states the amount of the consideration actually received by the seller so that the tax actually paid is less than that which was actually due, the seller shall pay an affidavit error fee as follows:

“(i) Twenty-five Dollars ($25) if the actual consideration received by the seller was from five per cent (5%) through 10 per cent (10%) greater than the consideration upon which the tax was paid, and

“(ii) One Hundred Dollars ($100) if the actual consideration received by the seller was in excess of ten per cent (10%) greater than the consideration upon which the tax was paid..

Hon. Bill Tippen, Page 2 (V-1375)

“(c) The seller shall pay the affidavit error fee to the Tax Collector and Assessor. One half of the affidavit error fee shall be retained by the county as a fee of office or paid into the officers salary fund of the county, as is provided by general law. The remainder of the affidavit error fee shall be paid over to the State. The Tax Collector and Assessor shall refuse to accept an application for registration or for transfer of title of any motor vehicle from any seller who owes the Tax Collector and Assessor an affidavit error fee.”

You specifically ask the following three questions:
”1. Is this method of exacting a fine or penalty constitutional, since it does not afford any type of hearing or right of appeal to any administrative tribunal or to the courts? Does it afford due process of law?

“2. Does the Tax Assessor and Collector have the authority to accept an applicdtion for registration or for transfer of title which is presented to him by the purchaser of an automobile from a dealer who owes an affidavit error fee? (Section C of the Act herein referred to, clearly states that the Tax Assessor and Collector shall not accebt an application from a seller who owes an affidavit error fee.)

“3. Is the refusal to accept applications constitutional as a method of enforcing a penal provision or of collecting a deficiency? ‘*

Your first question calls for ‘a consideration of that portion of the statute which requires the seller and purchaser to make ajoint affidavit disclosing the true consideration upon which the tax of 1.1% is assessed by Section l(a) and (b) of the act. The statute provides in explicit terms for payment by the seller of an “affidavit error fee” in the event the joint affidavit incorrectly states the consideration paid.

You ask specifically if this portion of the statute accords due process. We think it does. That this is a part of a revenue statute is apparent, and has for its purpose,the prevention of fraud and evasion of avalid revenue measure and is in our opinion an appropriate and proper provision upon the subject of revenue ~ We think the portion of the statute here considered does nothing more than subject a dealer who fails or refuses to comply with the statute to a right of action in favor of the State.

Hon. Bill Tippen, Page 3 (V-1375)

for the ‘affidavit error fees” prescribed by the **statute.** The fact that it will subject dealers to litigatiqn by the State to enforce the collection of the fees thus incurred is not sufficient to condemn this part of thk **statute** as a denial of due process. It is but giving a right of action in favor ,of the State for the enforcement of the **statutory** lien provided by Article 7083a, V. C.S., against a dealer who fails to comply with its provisions. The fact that the State must bring suit in a court of Isw guarantees to the dealer a hearing and a r’ight of appeal. *his action preserves to the dealer a’ll of the fundamental rights characterized as due .process. Hagar v. $ecla&$ion District No. 108,, 111 U.S. 701 (1894); Ivfexis IndePendent Schbol Dist. v. City of Mexia, 134 Tex. 95,133 S.W.2d 118 (1939).

This portion of **the statute**  **does** not by its terms deprive a dealer of any right. Itsdoes not impose an arbitrary or oppressive burden. It simply require6 that the true considcration be stated. It is within the lagi6lative power to inake rersoaable provisions to in6ure the pe,rformance bf *ties 60 closely interwoven with th6 public welfare in collection of tax66 legrlly~ imposed and to render~dealere 6ubject to rer6b&abls penalties incurred by reason of their ne.gli&ncc or refuosl t$ comply with **the statute.**  United Slz+tei v. Stowcll, 133 U.S. 1 (1890); Ipterst@a Forwarding Co. v. Vinyard, 121 Tex. 289, 49 S.W.Zd 403-0; %‘lrst Nat. Bdnk v. Hughes, 6 Fed. 737 (cx.N.D. Ohio, 1881).

In answer to **your** first q&&ion, we hold that this **part** of the **statute** deep not v,iotate due‘process under either the Federal or State Con6titutioa, or rny ot$ar provision of the Coastitutidn, but is a valid exercise 

### ofcomtitutional legislative pow6r in the enforcement of the **revenue** laws of this State.

**We ~466**  next to the coasideration of **your** eecond question which calls for an opinion 66 to the constitutionality of the following provisioh 

### ofthe statutb:

“The Tax Collector snd A66es6or shall **refuse** to accept an application for redistration or for tranrf6r of tiile of any motor vehicle from any seller who **owe6** the Tax Collector and **h66666Or** an affidavit error 

### fQe.**”**

There is nothing inherently unlawful in the **sale** of automobiles. The right to engage in:&y lawful business without **4x1~**unreasonab,le rtstraiut and tegulotioa ib inherent in **our** democratic system 

### ofgovernrrient. Whether **(L statute**  **erhanates** from tke police powar or the taxing power of 

### theState, it,is clear that the State cannet prohibit thl ordinary buaitiess of buying or selling rrew or **used motor**  vehicles by vestin& absolute or arbitraryHon. Bill Tippen, Page 4 (V-1375)

power in the tax assessor-collector to refuse to register cars 

### sold **by** dealers 

### delinquent inthe payment of*affidavit error 

### fees.” The seller must be given an appvopriate hearing 

### andan opportunity toexonerate himself before thedenial ofsuch aval

### uable right 

### as the pursuit of**a**

### lawful busineea. We think **this** portlon ofthe 

### statute ia **a**

### denial ofdue procesr and subjects such a dealer to arbitrary 

### restraint, freedom from wkich ia guaranteed by theConstitution oftheUnited States **and** 

### theBill ofRights embodied in the Constitution 

### ofthisState.

I,fthis 

### statute conferred discretionary power upon the tax assessor-collector safeguarded 

### by reasonable rules or regulations for his guidance intheperformance ofhis duties thereunder, and provided amethod ofappeal, this provision **of** 

### the statute might be susthined, but this it 

### does notdo, Instead itvests inthetaxassessor-collector unqualified end unrastraiaed **power** 

### torefuse the registration **of** 

### motor .vehiclea purchased from adelinquent dealer, The cQoduct of**a**

### lawful **business** and the right toearn **a**

### fkelihood therefrom may notbe thus stifled. ge Corporation v, SamuelI, 130 Tex. 107, 1 thesu preme c ingArticle 6g54,N.C.S.. **readi a8** 

### followl? ou*t Incoastru-

*If theproperty tendered back by 

### the**defendnat has** **beam injured**  

### or **&ma-d while** **in**hi,sposaess~on under 8och **bond,** tke

## l beriff or conmtable to

### whomthe same **is tendered** aball notreceive thesame, unless thedefendant 

## l

Zkke*ime 

### t&me**bnderr the** **reasonsbte** amount d suph 

### iqjury m 

### damage,**ta be** judged ofby 8och **ofitcbr.** (Emphamla add 

### d) e . said: “Tht **part** ofertHe **68%** 

### eatboriatag **the** sher

### iff 01coamtable to&termlue tkeamount ofdamages **te the** **property repCsvled**  

### baatiea nullified, because it undertake@ toconfer upoo #ucchofflcer judicial 

### power, **aad it** has been bell **timt** such power cannot 

### beconferred uponrerbaaefficer. Morgan v. Coleman (Tex. ($1~.App,) 

### 281SW. 670~Dupree v. State, 102Tex. 455, 119S.W. 301.” The Legislature intheexercise **of**thesovereign power 

### oftaxattonhaatheiacldeatal rllht 

### tomakereasrolrble provisions fot the collection oftaxes and theenforcement of payment thereof, andwhat we kave **said above**  **LB O&**  **to be**  **con** 

### rtcued to 

### tke

# comtrmtp.**We**hmid. kmmml~lcc

# toIlrt 

## l *64 q-n

### tia, **that the** **mstbod here**  **a&ptedd.** 

### for **the**

### rubsem **we have**  p&it& oat 

### above, is 

### uncoaatitutisul.APPROVED:
W. V. Geppert Taxation Diviaioa . ,

Hon. Bill Tippen, Page 5 (V-1375)

We may hold that part of the statute first considered constitutional and hold that part which we have considered in connection with your second question unconstitutional, as they may be separated and are not so dependent upon each other as to preclude-the application of this ruie. City if Taylor v. Taylor B‘eddKng Mfg. Co., 215 S.W.Zd 215 (Tex. Citi. App. 194g, 

### arrds ref.j.

Olu answer to your eecoad qkstioa necessarily answers your third question.

Subsection 4 of Section VII (M&r Vehicle Sales Tax) of Home@ Bill 285, 

### Acts S2ndLeg., eh. 402, p. 695 (Sec. 5a, Art. 7047k, V.C.S.) requiring the seller and purchaser of m&e@ vehlclee to eicecuto 8hint affidavit gibing the true **conrideratien** w w#ch the metor vehicle aales, tax is 

### aaaessed, prawiding 

### forpaymentby the dealer of an “affidavit err’or fee,” ia avalid proviaiee of a t&ng ,statute and does not violate the due process clause of the 14th Amendment of the Constititibn **of** the United States or the 3rd and 19th Sections of Article I of the Constitution ef this State.

That portion of Article 7047k. bowever, wh6eh vests arbitrary 

### pewer 

### inthe tacoasaeoeor-collector tt# refuse to register mstcpr vehic,lee purchased from delinquent dealsra is uncenrtitptieaal 

### aadvoid beeauaa it 

### denies d&e pocera under the 14th Amendment Ot the 

### Federal Constitutim 

### aud Settionr 3 and 19 **of**

### Article I od the Coa#titrtlw of the State 

### of**Texas and**  vista judicial pawer in aa &miai&trativc OJiice, of the State in violation of w&ton 1,

### Article II Otw Cmnmtitutioa of the State of Texar. 

### Your8 

### very truly, P-E ,ANIEL 

### Attsraey General



### Charles D. Mathews 

### First Assistant

LPL/mwb