#### Castleberry, d. b. a. Cedar Hill Farms, Appellee, *v.*Evatt, Tax Commr.; Deeenbacher, Dir., Appellant.

(No. 30591

Decided July 3, 1946.)

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      *Messrs. Kane, Kennedy, Brant $ Morris,*for appellee.

*Mr. Herbert D. Defenbacher, in propria persona,*as Director of Finance.

Matthias, J.

The writer of this opinion entertains the view that the notice of appeal from the Board of Tax Appeals to this court does not comply with the requirement specified in Section 5611-2, General Code, that ‘ ‘ such notice of appeal shall set forth the decision of the Board of Tax Appeals appealed from”; and therefore that the general provision of Section 12223-5, General Code, which reads, “the notice of appeal shall designate the order, judgment, or decree appealed *32from,” has no application to this proceeding.

However, the majority of the court having ruled against the motion to dismiss the appeal, we proceed to a consideration of the case on its merits.

The sole question presented is whether milk sold through the vending machines of the vendor was sold for human consumption off the premises where sold and such sales are therefore nontaxable, as decided by the Board of Tax Appeals.

The vendor owns and operates his business in the name of “Cedar Hill Farms” and in that name conducts a dairy. He installed and maintained vending machines in the plants of The Wright Aeronautical Corporation in Lockland and the William Powell Valve Company in Cincinnati, which vending machines were patronized by the employees of those companies. The vendor had no right of control and exercised no control over any of the premises of either company. He had only the right of ingress and egress to service the vending machines by placing therein milk in containers and removing therefrom the coins inserted by purchasers.

Whether the sales involved herein are taxable turns upon the construction of Section 12 of Article XII of the state Constitution, which provides that “on and after November 11,1936, no excise tax shall be levied or collected upon the sale or purchase of food for human consumption off the premises where sold.”

What is meant by the term “premises where sold”? Does it include the entire building, whether large or small, where sales of food products are consummated, and if sales are made anywhere within an enclosure does such entire enclosure constitute the “premises”; or is it the limited portion of a building, structure or enclosure which is in the actual possession or under *33the actual control of the vendor which constitutes the “premises where sold”?

The contention of the appellant is that the meaning first above ascribed, referred to as the “metes and bounds ’ ’ theory, is correct. If that meaning be adopted then the entire building, in which the vending machine is located at the particular time the sales are made, is the “premises.” The vendor contends that the meaning last above ascribed, which is referred to as the “control” theory, is correct.

It is well settled that in the interpretation of an amendment to the Constitution the object of the people in adopting it should be ascertained and given effect and that the polestar in the construction of constitutional, as well as legislative, provisions is the intention of the makers and adopters thereof. 8 Ohio Jurisprudence, 135, 153, Sections 36, 56.

What was the purpose of the constitutional amendment? It has been urged by the appellant that the argument advanced by the committee, appointed to sponsor the amendment, shows that it was to “repeal the sales tax on food for *HOME*CONSUMPTIONHowever, we find the further statement in the argument, that “food is the greatest necessity of life. A special tax on food is the most unjust and obnoxious that could be levied.”

It seems perfectly clear that in the framing and adoption of the proposed amendment there was no purpose to impose the tax upon the sales of any food, which, .under the law then in effect, were exempted from such tax.

Under the law then in effect the sale of fluid milk for consumption off the premises of the vendor and of bread in loaf form were not taxable. The constitutional amendment under consideration providing for *34the exemption of food from taxation was’initiated by petition, and there can be no donbt that the proponents, when they sponsored, and the people, when they adopted, such constitutional amendment, sought to broaden and extend the freedom of sales of food from taxation and not in'any respect to limit or narrow any exemption then existing. The manifest purpose was to remove a tax, not to impose a tax. The particular purpose of the amendment seems to have been to tax only sales of food which is sold and served in restaurants or other similar places under the control of the vendor.

If the so-called “metes and bounds” theory, contended for by the appellant, is to be applied, then sales of milk and bread delivered at the door of the consumer will be taxable, for such sales would be for consumption on the premises where sold. Likewise sales by retail grocers who make deliveries to the premises of the purchasers would also be subject to the tax, for those sales too are completed and consummated on the premises of the purchaser and would be sales of food for consumption on the premises where sold. ■

It is to be observed also that under the “metes and bounds” theory, sales of food to the tenants of an apartment building wherein the vendor’s store is located would be subject to the tax, for such sales of food would be for consumption within the boundary of the premises where the sales are made, as would also sales of food at a booth located on land used as a trailer camp to customers then living in the trailers parked within the enclosure.

In the instant case, the packaged milk was purchased for consumption off and away from the premises under the control of the vendor. The record dis*35closes that such milk was never consumed at a vending machine but always away from it, and that in at least one of the plants named a rule was enforced which forbade the employees of the plant to congregate about the vending machine or drink milk procured therefrom in the aisles where the vending machines were located.

The construction of this constitutional provision, as contended for by the appellant, would result in classifying all industrial plants, large or small, within the bounds of which there are any sales of food, as the “premises where sold,” notwithstanding the fact that the sale is consummated by a vending machine which is the only premises owned or controlled by the vendor.

In addition to the above illustrations many others could be suggested to fully demonstrate the unreasonable and absurd results of the application of the so-called “metes and bounds” theory. On the other hand any and all inequitable and absurd results may be avoided by the application of the so-called “control” theory.

It is elementary that in the construction of a constitutional provision or legislative enactment unreasonable or absurd consequences should,- if possible, be avoided.

It is conceded that the Department of Taxation has been confronted with much difficulty in administering the taxation provision involved herein, which has resulted in the final preparation and adoption of Rule 54& which is as follows:

“The word ‘premises’ as used in Section 5546-2, G-eneral Code, exempting from the sales tax all sales of food for human consumption ‘off the premises where sold’ is defined as being that part of a building or area *36where sales of tangible personal property are made and which is under the control of the vendor or in any part of which the vendor by lease, contract, permission, license, grant, privilege, or any other right whatsoever, makes such sales.”

This rule, which the Tax Commissioner adopted and the Board of Tax Appeals apparently applied in this instance, is a uniform common-sense rule which embraces the so-called “control” theory, as above stated, and in the opinion of the court it effectuates the purpose and intent of the people in adopting the constitutional amendment.

For the reasons stated the decision of the Board of Tax Appeals is deemed to be lawful and reasonable and is therefore affirmed.

*Decision affirmed.*

Weygandt, C. J., Williams, Turner and Hart, JJ., concur.

Zimmerman and Bell, JJ., dissent.

Zimmerman, J.,

dissenting. This case presents two questions for decision: 1. Did the notice of appeal from the Board of Tax Appeals to this court sufficiently meet the requirements of Section 5611-2, General Code? 2. Were the sales of packaged milk at 10 cents per unit from vending machines subject to the Ohio sales tax?

As to the first question, Section 5611-2, General Code, relating to appeals from decisions of the Board of Tax Appeals to the Supreme Court, provides in part:

“Such notice of appeal shall set forth the decision of the Board of Tax Appeals appealed from * * *.”

It is important to note that such section, unlike *37Section 5611, General Code, pertaining to appeals from final determinations of the Tax Commissioner to the Board of ■ Tax Appeals, says nothing concerning the inclusion of any paper in the notice of appeal by way of attachment or incorporation.

The terms “set forth” and “set out” ordinarily mean to recite or narrate facts or circumstances; to describe or to incorporate. See Black’s Law Dictionary (3 Ed.), 1612.

Here the challenged notice of appeal contains the following language:

he [appellant] desires and intends to appeal to the Supreme Court of Ohio from a judgment of the Board of Tax Appeals entered in cause number 9523 on November 7,1945, reversing an order and judgment theretofore made and entered by the Hon. William S. Evatt, former Tax Commissioner, wherein a tax assessment was levied against one J. P. Castleberry of Mariemont in the state of Ohio. # * * Said entry of judgment is erroneous and contrary to law in finding as a matter of law and fact that the milk which was the subject matter of the sales was sold to be consumed off the premises where sold.”

The principal function of a notice of appeal is to advise the opposite party of the taking of an appeal. Statutes relating to appeals are remedial and should be liberally construed to the end that the right of appeal may not be defeated. *Commonwealth Oil Co.*v. *Turk,*118 Ohio St., 273, 160 N. E., 856; 37 Ohio Jurisprudence, 732, Section 411.

The notice of appeal here involved *was filed with the Board of Tax Appeals withm the thirty-day limitation.*It adequately describes and sets forth the decision complained of and was sufficient to satisfy the demands of Section 5611-2, General Code. See *Capital*
      *38
      *Loan & Savings Co.*v. *Biery,*134 Ohio St., 333, 16 N. E. (2d), 450; *Trotwood Trailers, Inc.,*v. *Evatt, Tax Commr.,*142 Ohio St., 197, 51 N. E. (2d), 645.

I't is the general rule that, although a notice of appeal should comply substantially with statutory requirements, it is usually sufficient if it contains enough information to apprise the opposite party of the particular judgment which is sought to be reviewed. 3 American Jurisprudence, 168, Section 470; 4 Corpus Juris Secundum, 1061, Section 593.

We will now consider the second question. It appears from the record that J. P. Castleberry, doing business as Cedar Hill Farms, placed milk vénding machines in two manufacturing plants. These machines could be and were moved from place to place in the plants. They dispensed paper-packaged milk at 10 cents per package. Such milk was bought by the employees of the manufacturing plants and consumed by them within the “four walls” of the buildings. Castleberry, through his employees and with permission, periodically filled the machines with the packaged milk and removed the money from the machines.

Does such a combination of facts make these milk sales taxable within the contemplation of the Ohio Sales Tax Act?

In December of 1934, the General Assembly of Ohio enacted the first sales tax law (115 Ohio Laws, pt. 2, 306). It was to be effective during the year 1935. In so far as pertinent, Section 5546-2, General Code, then read:

“For the purpose of providing revenue * * *, an excise tax is hereby levied on each retail sale in this state of tangible personal property * * *, with the *exceptions*hereinafter mentioned and described, as follows': * * *

*39“The tax hereby levied does not apply -to the following sales: * * *

“2a. Sale of fluid, milk # * * for consumption *off the premises of the vendor** * *.” (Italics ours.)

During December, 1935, the General Assembly extended and re-enacted the sales tax law through March 1937 (116 Ohio Laws, pt. 2, 69). The language of the initial act quoted above was included in the re-enactment.

Then at the general election in November of 1936 the voters adopted Section 12, Article XII of the Ohio Constitution, reading as follows:

“On and after November 11, 1936, no excise tax shall be levied or collected upon the sale or purchase of food for human consumption *off the premises, ivhere sole}.”*(Italics ours.)

In adopting such additional provision, the voters undoubtedly had primarily in mind that the sale of food bought in grocery stores, meat markets, and other like establishments, to be removed therefrom for preparation and consumption in homes and other places away from the locations where bought, should be free from any tax.

After the adoption of the constitutional provision, the Sales Tax Act was rewritten. Section 5546-2, General Code, in its existing form and with which we are presently concerned, levies an excise tax on each retail sale made in this state of tangible personal property. However, “if the price is less than nine cents, no tax shall be imposed.”

Section 5546-2, General Code, further provides:

“The tax hereby levied does not apply to the following sales: * * *

“2. Sale of food for human consumption *off the premises where sold.** * *” (Italics ours.)

*40In subdivision 2, “milk and milk products including ice cream” are defined as food as that term is used therein.

The last paragraph of Section 5546-2, General Code, significantly states:

“For the purpose of the proper administration of this act and to prevent the evasion of the tax hereby levied, it shall be presumed that *all sales*made in this state are subject to the tax hereby levied until the contrary is established.” (Italics ours.)

Therefore, “where a specific retail sale of tangible personal property is «shown to have been-made by a vendor # * *, such sale is presumed to be subject to the tax * * * and the burden of proof to establish the contrary is upon the vendor.” *State, ex rel. Foster,*v. *Evatt, Tax Commr.,*144 Ohio St., 65, 56 N. E. (2d), 265.

By virtue of the presumption that all sales of tangible personal property in Ohio are subject to the sales tax, a claim of exemption is to be scrutinized- closely and denied if the right to exemption is not clearly established.

This brings us to a consideration of the meaning of the term, “off the premises where sold,” as used in Section 12, Article XII of the Constitution and in Section 5546-2, General Code. As we read the organic and statutory laws mentioned, the word “premises” is used in its usual and ordinary sense, which is “a distinct portion of realty; land, or lands; tenements, buildings.” Anderson’s Dictionary of Law, 802. Or, as was remarked in the opinion in the case of *Bowers*v. *Pomeroy,*21 Ohio St., 184, 190, “the word ‘premises’ was used in the statute as the very synonym of lands and tenements.”

Therefore, to say that the vending machines in the plants constituted the “premises” is untenable.

*41In this connection attention is called to Rule 54 of the Department of Taxation, which reads as follows:

“The word ‘premises’ as used in Section 5546-2, exempting from the sales tax all sales of food for human consumption ‘off the premises where sold’ is defined as the entire building, tent, or other structure, together with contiguous lands or any lands whether enclosed or not, in or on any part of which the vendor by permission, license, grant, privilege, or by any other right whatsoever makes sales.”

Of course, the “metes and'bounds” theory, as it is called in the majority opinion, must be given a common sense application in harmony with the object intended by Section 12, Article XII of the Constitution. No one would seriously contend that, where a food market occupies the first floor of a building and the upper floors are divided into residence apartments, an occupant of one of the apartments would be required to pay a tax on the sale of food purchased in the market for consumption in his apartment. And no tax is collectible on the sales of milk, bread, etc., where such commodities are delivered by the seller to the customer in his home for consumption there. These illustrations, we submit, are wholly dissimilar to and readily distinguishable from the situation with which we are presently concerned.

In answer to a question from the bench during the oral argument of this case, one of counsel for the appellee stated that if Castleberry’s representatives had gone through the plants selling the packages of milk, to the employees in the plants, such sales would be taxable. Here, the milk vending machines were distributed over the plants — the premises. The milk was removed from the machines by the employees and consumed in the plants *themselves*— on *the premises where*
      *42
      *sold.*We can see no real difference between the two situations.

As a sidelight on this controversy, the following-paragraph from the decision of the Board of Tax Appeals is of interest:

“It has been suggested that since the ceiling price for a pint of milk was nine cents a tax of one cent was collected by the appellant from the consumer; however, the record shows that the appellant sold this milk at ten cents per pint and that no tax was collected and no prepaid tax receipts purchased by the appellant. If the ceiling price was exceeded that was a matter for the Office of Price Administration and not for this board.”

We are of the opinion that the sales of the packaged milk in the circumstances and under the conditions disclosed by the record in this case were taxable within the design and intent of the Ohio Sales Tax Act. The Tax Commissioner was correct in so determining, and the decision of the Board of Tax Appeals to the contrary is unreasonable and unlawful and in that respect should be reversed.

Bell, J.,

dissenting-. Judge Matthias and I are of opinion that this appeal should be dismissed for failure of the appellant to comply with the requirements of Section 5611-2, General Code.

The right of appeal being entirely a statutory right, compliance with the terms imposed by statute is a condition precedent to the enjoyment of such right. Collins, *Exr.,*v. *Millen,*57 Ohio St., 289, 291, 48 N. E., 1097.

Section 12223-3, General Code, provides:

“Every final order, judgment or decree of a court and, when provided by law, the final order of any administrative officer, tribunal, or commission may be *43reviewed as hereinafter provided, *unless otherwise provided by lato** ****.” (Emphasis supplied.)

Section 12223-4, General Code, provides:

“The appeal shall be deemed perfected when written notice of appeal shall be filed with the lower court, tribunal, officer or commission. * * *”

Section 12223-5, General Code, provides:

“The notice of appeal shall *designate*the order, judgment, or decree appealed from * * *.” (Emphasis supplied.)

Subsequent to the enactment of the above general provisions, Section 5611-2, General Code (118 Ohio Laws, 344, 355), was amended. It contains the specific requirement that to perfect an appeal from the Board of Tax Appeals to the Supreme Court, the appellant shall file ‘ *‘*a notice of appeal with the Supreme Court of Ohio-and with the Board of Tax Appeals.” Such notice of appeal shall be filed within 30 days after the decision and “shall *set forth*the decision of the Board of Tax Appeals appealed from and the errors therein complained of.”

It is perfectly clear that the General Assembly, in the enactment of Section 12223-5, General Code, provided that, for appeals generally, the notice of appeal shall merely *designate*the order, judgment or decree appealed from.

However, the General Assembly, in amending Section 5611-2, General Code, specifically provided otherwise with reference to appeals to the Supreme Court from the Board of Tax Appeals for, as to such appeals, it did not use the term *designate,*but did require that the notice of appeal *shall set forth*the *decision*of the Board of Tax Appeals appealed from and errors therein complained of.

In the instant case the only reference to the deci*44sion of the Board of Tax Appeals contained in the notice of appeal is that appellant desires and intends to appeal from a “judgment of the Board of Tax Appeals entered in cause number 9523 on November 7, 1945, reversing an order and judgment theretofore made and entered by the Hon. William S. Evatt, former Tax Commissioner, wherein a tax assessment was levied against one J. P. Castleberry of Mariemdnt in the state of Ohio.” The appellant then states therein the error of .which he complains.

The Board of Tax Appeals has no authority to enter *judgment*in any matter of which it can take cognizance. The statutes authorize it to render *decisions.*

Here there was a complete failure *to set forth the decision*of the Board of Tax Appeals. As I read and construe Section 5611-2, General Code, there are two conditions precedent which must be strictly complied with before this court acquires jurisdiction, *i. e.,*(1) the notice of appeal must be filed within the time limited by the statute and (2) must *set forth*the *decisión*of the Board of Tax Appeals appealed from. Obviously the second condition precedent was not complied with in the instant case; hence this court never acquired jurisdiction.