## I L L I N O I S 

## O F F I C I A L 

## R E P O R T S

A p p e l l a t e C o u r t

Interstat e Trucks, LLC v. State , 2011 IL App (4th) 100603

Appellate Court Caption INTERSTATE TRUCKS, LL C, Plaintiff-Appellant, v. THE STATE OF ILLINOI S, Acting Throug h the DEP AR T M ENT OF REVENUE, and BRIAN A. HA MER, Director , Def endants-A ppellees.

District & N o. Fourth District Docke t No. 4–10–0603

Filed J une 14, 2011

Held ( Note : Th is sy ll abus

con st it ute s no par t o

f t he opi nio n of

th e c our t b ut has bee n pr epa red

by the Repo rt er of Deci si ons fo r the con ven ie nce of

th e

rea der

. ) The trial court’s decision aff irming the Dep artment of Revenue ’s determination that the trucks plaintiff deale r purcha sed in I llinois for

resa le at its deale rship in Tenne ssee and drove back to Tenne ssee neede d single -trip permits was rever sed b y t h e appellate court, since the t rucks did not fit t he definition of “commercia l motor vehicle” in section 1.16 of the Motor Fue l Tax L aw, and, furthermore, plaintiff was not require d
to purcha se the sin g le-trip permits as reimburse ment to the State of I llinois for the motor-f

u el -u se tax beca

use fuel for the trucks was purcha sed in I llinois , as evide nced by an af fidavit of plaintiff’ s owner.

Dec ision Under Review Appea l f r o m th e Circ uit Court of Sang amon County No. 09–MR–349; the Hon. J ohn W. Belz, J udg e, pre siding.

J udg ment Reverse d.Counsel on

Appea l Duane D. Young (ar g ued), of L aB arre, Young & B ehnke, of Springf ield, for a ppellant.

Lisa Madig an, Attorne y

Gene ral, of Chica g o (Michae l A. Scodro, Solicitor General, and Eric T ruett (a rg ued), A ssistant Attorney Gene ral, of c ounsel), for

appellee s.

Panel PRES IDING JUS TI CE KNECHT delivered the judg ment of the c ourt, with opinion.
J ustices Steigmann and Cook conc urre d in the judgme nt and opinion.

OP INION

¶ 1 Plainti ff
, I n t er s t at e Trucks, L L C, appeals the decision of the I llinois Depa rtment of Revenue (De partment) affirming the Depart ment’s i ssuance of four notices of tax liability in the amount of $1,000 per n o t i ce fo r p laintiff’s failure to obtain and display single -trip permits as require d under section 13a.5 of the Motor Fue l Tax L aw (Tax L aw) (35 IL CS 505/13a.5 (West 2006)). ¶ 2 Plaintiff soug ht ad m i n i s t ra t i v e revie w and the circ uit court aff irmed the Depa

rtment. Plaintiff appeals, claiming the Depa rtment err ed in the following respe cts: (1) it erred in its construction of section 13a.5 of the Tax L aw beca use it held “a single trip throug h the State of I llinois ” included trucks purcha sed and fuele d in Illinois and then driven to Tenne ssee, and (2) it e rre d in not rec og nizi ng the exception e stablished in se ction 1.16 of the Ta x L aw ( 35 IL CS 505/1.16 (West 2 0 0 6 ))

. For the following rea sons, we reverse the circ uit court’s decision af

firming the Depa

rtment’s dec ision.

¶ 3 I . BA CKGROUND ¶ 4 Plaintiff was a truc k deale r with its sole place of business in the S tate of Tennessee . I n Marc h 2007, plaintiff purcha sed fi v e trucks from Central I llinois Trucks, I nc., located in Springf ield, I llinois

. These trucks wer e purcha sed for resa l e at p l aint iff’s deale rship in Tenne ssee. ¶ 5 L ater in Marc h 2007, plaintiff arrang ed for its ag ents to transport the purcha sed t ru cks from Springf

ield, I llinois
, to its deale rship in Tenne ssee. I n prepa ration for the transportation of the trucks, Central I llinois Trucks, I nc., provided the trucks with seven- day permits ($10

eac h) as require d under section 3–811(c) of the I llinois Vehicle Code (625 IL CS 5/3–811(c) (West 2006)), “which wer e acquir ed by the seller, in b u lk, from the I llinois Secre tary of State.” The seven- day permits allowed plaintiff to la wfully operate the trucks purcha sed in

-2-I llinois on I llinois highw ay s. 625 IL CS 5/ 3–811 (West 2006).

¶ 6 When plaintiff’s ag ents wer e transporting the trucks to Tenne ssee, four of the trucks wer e stopped by ag ents in the Depa rtment’s Bur eau of Criminal I nvestig ations at mile post 46 on I n t er s t at e 5 7

. As a result of the stop, the Depa rtment issued four notices of tax liability t o plaintiff beca

use plaintiff had failed to acquir e motor-fue l-use-ta x licenses (price depende nt

on whether reinstateme nt fee is due and whether applicant is require d to post bond) or single

trip permits ($20 each) before transporting the t rucks a s require d under se ctions 13a.4 and 13a.5 of the Tax L aw (35 IL CS 505/13a.4, 13a.5 (West 2006)). The s ev en-day permits plaintiff had obtained for the trucks wer e not sufficie nt to cover any motor-fue l-use tax due. ¶ 7 Plaintiff protested the issuance of the notices of tax liability and reque sted a hearing with the Depa rtment. Prior to the hear i n g, the parties stipulated (1) plaintiff was a truck deale r having no place of business in the S t at e of I llinois ; (2) the trucks were purcha sed from Central I llinois Trucks, I nc., for resa le at plaintiff’s Tenne ssee deale rship; (3) the trucks wer e

s t o p p ed by the Depa

rtment; (4) the trucks had seven- day permits issued by the I l l i n o i s Secre tary of State to drive them from o n e deale rship to another ; (5) plaintiff was not a

common car

rier and not in the business of transporting persons or property for hire; (6) the vehicles in question wer e exit ing the State of I llinois and trave ling to plaintiff’s business in
t h e S t at e of Tenne ssee; (7) the trucks in question wer e semi-trac tors and not pulling any trailers or car g o; and (8) none of the trucks had motor-fue l-vehicle -tax licenses and display decals. ¶ 8 Additionally
, prior to the hearing, the parties ag ree d Br uce Thomas, manag er of Centra l I llinoi s Trucks, Inc., would not be called as a witness at the hearing and, instead, his testimony would be admitted into evidence throug h an aff idavit. I n the aff

idavit, Thomas stated i n order to enable the transportation of the trucks, Centr al I llinois Trucks purchase d approximately

30 g allons of fue l for ea ch truc k for a total of approximately 150 g allons of fuel. Three fuel rec eipts wer e attache d to the aff idavit, ea ch s h o wing the purcha se of approximately 50 g allons of fuel. Further, the aff idavit stated the trucks wer e equipped with sufficie nt f

uel to drive from Springf

ield, I llinois
, to T ennesse e and, in pa rticular, sufficie nt fuel to drive ove r the Illinois border to Paducah, Ke ntucky

. ¶ 9 T h e h ea ring was held on November 13, 2008, in front of an administrative law jud ge (AL J ), who rec ommended aff irming the issuance o f t h e notices of tax liability

. At the hearing, the Depa

rtment arg ued plaintiff was require d to have a single -trip permit aff ix ed to

eac h truck pursuant to section 13a.5 of the Tax L aw. The Depa rtment also arg ued the single

trip permits wer e require d beca use plaintiff met the definitions of “commercial motor vehicle” as set forth in section 1.16 of the Tax L aw and “motor car rier” as define d in section 1.17 of the Tax L aw ( 35 IL CS 505/ 1.16, 1.17 (West 2006)). ¶ 10 Further, the Depa rtment arg ued t h e ad m i s s i o n o f the fuel rec eipts into evidenc e wa s insufficient to prove the fuel for all five trucks was purcha sed in I llinois beca use two of the trucks would havebeen f ueled at two differ ent pumps. In particula r, the Depa

rtment noted only three rec eipts wer e admitted into evidenc e for five trucks, eac h rec eipt indicated approximately 50 g allons of fuel had been purcha sed, and Central I llinois Trucks purcha sed approximately 30 g allons o f fu el for eac h truck. Additionally
, the Depa rtment noted the

-3-vehicle identification numbers (VIN) written on the rec eipts matched the VINs of only two

of the trucks in question. The Depa rtment arg ued these discrepancies undermined Thomas’s

cre dibilit y

. ¶ 11 I n contra st, plaintiff arg ued the single -trip permits wer e not require d beca use (1) se ction 13a.5 of the Tax L aw did not apply beca use the I llinois trucks were boug ht and fuele d in I llinois
, the retail tax for the fuel purcha ses was paid in Illinois
, and the trucks exit ed I llinois ; (2) plaintiff did not operate the trucks for a single trip throug h Illinois
, or from a point on the border to a point within I llinois and then return to the border as require d under section 13a.5 of the Tax L aw ; and (3) plaintiff, as a deale r, fit into an exception established in the definition of “c ommercia l motor vehicle” in section 1.16 of the Tax L aw. ¶ 12 On Marc h 30, 2009, the AL J rec ommended aff

irming the issuance of the notices of tax liability but also rec ommended reduc ing three of the notices from $2,000 to $1,000 beca use the stops wer e all considere d a fi rs t -time occur renc e. The ALJ determined the trucks fell within the definition of “commer cial motor vehicle” beca use the trucks were “motor vehicles that [were] used, desig ned or maintained for the transportation of persons or prope rty , and they have [three ] ax les.” ¶ 13 The ALJ noted the definition of “commercial motor vehicle” included an exception for “commer cial motor vehicles operated solely within [I llinois ] for wh ich all motor fuel is purcha sed within [I llinois ].” Howeve r, the AL J determined this ex ception did not apply to plaintiff’s trucks beca

use the fac ts wer e undisputed plaintiff drove the trucks out of the State and to Tenne ssee. Also, the ALJ ag ree d with the Depa rtment and determined Thomas’s aff idavit reg arding the fuel purcha se was implausible beca use one vehicle was not normally fuele d at two diffe rent pumps. ¶ 14 Additionally
, the ALJ determined plaintiff fell within the definition of “motor ca rrier .” The ALJ noted a “ ‘motor car rier’ [was] any person who operate[d] or cause s to be operated
any commerc ial motor v eh i cl e on any highw ay in I llinois

. 35 IL CS 505/13a.5 [(W est 2006)].” The AL

J determined plaintiff wa s a “motor car rier” beca

use “it operated

commerc ial motor vehicles in Illinois on the day in question.” ¶ 15 Further, the ALJ d et er m i n ed plaintiff was require d to obtain single -trip permits under section 13a.5 of the Tax L aw beca use the trucks fit within th e definition for “commer cial
motor vehicle,” and plaintiff fit within the definition of “motor ca rrier .” The ALJ noted a single -trip permit authorized “o p er ati on of a commerc ial motor vehicle ‘for a single trip throug h the State of Illinois
, or from a point on the border of this State to a point within and
return to the border .’ [35 IL CS 505/13 a.5 (West 2006)].” The ALJ stated the trucks wer e used for a single trip throu gh I l linois beca use the trucks wer e picked up in Springf ield, I llinois , and drive n to Tennesse e. ¶ 16 I n April 2009, defe ndant, Brian A. Hamer
, Direc tor of defe ndant Depa rtment (Dire ctor),

acc epted the ALJ ’s recommendation. I n May 2009, plaintiff filed a complaint for administrative revie w. The ci rc u i t court hear d arg uments and in J uly 2010 aff irmed the Direc tor’s dec ision. ¶ 17 Specifica lly
, the circ uit court determined plaintiff’s trucks did fit within the e x ception established in the definition of “commer cial motor vehicle” in section 1.16 of the Tax L aw.

-4-The court noted plaintiff’s arg ument reg arding all the fuel being purcha sed in I llinois became

moot as soon as the trucks e x ited I llinois

. ¶ 18 Additionally , the circ uit court noted a prior version of section 1.16 of the Tax L aw ( 35 IL CS 5 05/1.16 (West 1992)) included an exclusion in the “commer cial motor vehicle” definition for “commer cial motor vehicles owne d by a manuf actur er or deale r and held for sale, even though incidentally moved or operated on the highw ay .” Acc ording to the court, this version of the statute excluded I llinois deale rs who “sold such vehicles to a buy er who is just moving them out of [I llinois ].” Thus, the circ uit c ourt conclude d the remova l of this exception from th e c o mm e r c ia l- mo to r

- v e h ic le d e f

in it io n s howed the leg islature intended “for this sit uation to requirethe sing le[-] trip permit.” ¶ 19 This appea l followed.

¶ 20 I I . ANALYSI S ¶ 21 Plaintiff appeals, claiming the Depa rtment err ed in the following respe cts: (1) it err ed in its construction of section 13a.5 of the Tax L aw beca use it conclude d “a single trip throug h the State of I llinois ” included trucks purcha sed and fuele d in I l l i n o i s an d then driven to Tenne ssee, and (2) it e rre d in not rec og nizi ng the exception e stablished in the definition of “commer cial motor veh icle” set forth in section 1.16 of the Tax L aw. For the following

rea sons, we re verse the circ uit court’s dec ision affirming the Depa rtment’s dec ision.

¶ 22 A. Standard of Review ¶ 23 Plaintiff arg ues the a pplicable standa

rd of r eview is de novo beca use this case prese nts

an issue of statut o ry construction, and no finding s of fac t wer e at issue. The Depa rtment

ar gu es this case does not prese nt a pure question of law. I nstead, it contends plaintif f’ s arg uments reg arding the Depa rtment’s application of the statutory lang uag e to the fac ts raise mix ed q u es tions of law and fac t and should be revie wed for clea r err or. The Depa

rtment further contends plaintiff’s arg uments reg arding the meaning of section 1.16 of the Tax L aw and the scope of the permits available under section 13a.5 of the Tax L aw are issues of law and should be re viewed de novo

. ¶ 24 On administrative revie w, the applicable standard of revie w is based on whether the ca se involves an issue of law, an issue of fac t, or a mix ed question of l aw and fac t. Provena Covenant Medic al Center v. Departme nt of Rev enue , 236 I ll. 2d 368, 386-87, 925 N.E.2d 1131, 1143 (2010). When the c ase involves a question of law, the standard of revie w i s de

novo

. Provena Cov enant Me dical Center , 236 I ll. 2d at 387, 925 N.E.2d at 1143. ¶ 25 Howeve r, when the case involves a question of fac t, the revie wi n g co u rt determines whether the finding s of fac t are ag ainst the manifest weig ht of the evidenc e. Cinkus v. Village of Stickney Municipal Officers Electoral Board
, 228 I ll. 2d 200, 210, 886 N.E.2d 1011, 1018 (2008). “An administrative ag ency ’s fac tual determinations are ag ainst the manifest weig ht of the evidenc e if the opposite conclusion is clea rly evident.” Cinkus
, 228 I ll. 2d at 210, 886 N.E.2d at 1018. ¶ 26 Additionally
, a mix ed question of law and fac t involves a dispute as to whether the fa cts

-5-of the case satisfy the applicable statutory require ments. Provena Covenant Medic al Center
,

236 I ll. 2d at 387, 925 N.E.2d at 1143. When the case involves a mix ed question of law and fac t, the ag ency ’s finding s are revie wed for clea r err or. Provena Covenant Medic al Center
, 236 I ll. 2d at 3 8 7
, 9 2 5 N.E.2d at 1143. “An administrative decision will be set aside as clea rly err oneous only when the revie wing court is left with the definite and firm conviction *** a mistake has been committed.” Provena Covenant Medic al Center
, 236 I ll. 2d at 387- 88, 925 N.E.2d at 1143. ¶ 27 The determination o f wh et h er p l ai ntiff was require d to obtain single -trip permits to transport its trucks to Tenne ssee under section 13a.5 of the Tax L aw and section 1.16 of the Tax L aw is a matter of statutory construction. There fore
, the standard of revie w is de novo

.

¶ 28 B. Sing le-Trip Permits ¶ 29 First, plaintiff arg ues the single -trip-pe rmit require ment was not applicable to its truc ks beca use the trucks wer e purcha sed in I llinois by an out-of-state resident, t h e t rucks wer e fuele d in Illinois
, and the trucks wer e driven from the I llinois deale rship, out of Illinois
, and
to plaintiff’s deale rship in Tenne ssee. In particula r, plaintiff arg ues the statutory lang uag e in section 13a.5 of the Tax L aw requiring a commerc ial motor vehicle to purcha se a single -trip permit “for a single trip thr o u gh t h e State of I llinois ” does not apply to trucks just exit ing I llinois

. Further, plaintiff arg ues its t ru ck s wer e not require d to have single -trip permits beca use the trucks did not fall within the definition of “commercial motor vehicle” set forth in section 1.16 of the Tax L aw. ¶ 30 The primary g oal of statutory construction is to “asc ertain and g ive eff ect to the dra fters’ intention, and the most reliable indicator of intent is the lang uag e used, which must be g iven its plain and ordinary meaning .” People v. Smith
, 236 I ll. 2d 162, 166-67, 923 N.E.2d 259, 262 (2010). ¶ 31 Section 13a.4 of the Tax L aw ( 35 IL CS 505/ 13a.4 (West 2006)) pr ovides as follows:

“Except as provided in Section 13a.5 of this Act, no m o t o r ca rrier shall operate in I llinois without first securing a motor fuel use tax license and decals from the Depa rtment or a motor fuel use tax license and decals issued under the I nternational Fue l Tax Agre ement by

any member jurisdiction.” ¶ 32 Additionally
, section 13a.5 of the Tax L aw (35 IL CS 505/13a.5 (West 2006) ) states, in pertinent pa

rt, as follows:
“As to a co m m er ci al motor vehicle operated in I llinois in the course of interstate traff ic by a mot or carrie r not holding a motor fuel use t ax license issued under this Act, a single trip permit authorizing operation of such commerc ial motor vehicle for

a single trip throug h the State of Illinois , or fr om a point on the border of this State
to a point within and return to the b o rd er m ay b e issued by the Depa rtment or its
ag ents afte r prope r application.” ¶ 33 Section 1.16 of the Tax L aw (35 IL CS 505/1.16 (West 2006)) defi n es “commer cial motor vehicle” as follows:

“ ‘Com m ercial motor vehicle’ means a motor vehicle used, desig ned, or

-6-maintained for the transportation of persons or property and either having 2 axles and
a g ross vehicle weig ht or reg istered g ross vehicle weig ht exceeding 26,000 pounds

or 11,793 kilogr ams, or having 3 or more axles re g ardle ss of weig ht, or that is use d i n combination, when the weig ht of the combination exceeds 26,000 pounds o r 11,793 kilogr ams g ross vehicle weig ht or reg istered g ross vehicle weig ht, exc ept for *** comme rcial motor vehic les operated solely withi n [Illinois] for which all motor fuel is purchased within [Illi nois] .” (Empha sis added.) ¶ 34 The Depa

rtment arg ues plaintiff was required t o ac q u i re ei ther a motor-f uel-use- tax license or single -trip permits prior to transporting its trucks from I llinois to Tenne ssee under sections 13a.4 and 13a.5 of the Tax L aw. Additionally
, the Depa rtment ar gu es t h e trucks

wer e not excluded from the definition of “comme rcial motor vehicle” beca use the trucks

wer e not exclusively operated within I llinois

. The Depa rtment further arg ues plaintiff’s
arg ument reg arding the fuel being purcha sed in I llinois is i rrelevant. I n contra st, plaintiff
arg ues its trucks wer e not included within this definition of “commer cial m o t or vehicle” beca use the trucks wer e stopped prior to exit ing I llinois and the fuel for the trucks was purcha sed in Springf

ield, I llinois

. ¶ 35 The definition of “commer cial m o t o r v eh i cl e” ex cl udes commerc ial motor vehicles

o p er at ed solely within Illinois for which all motor fuel is purcha sed in I llinois

. I n th e stipulation, the parties ag ree d the trucks “we re exit ing the State of Illinois from the location they had been acquir ed at to the location of I nterstate Trucks in the State of Tenne ssee.” Although the trucks wer e being transporte d to Tenne ssee, the Depa rtment’s Bur eau of Criminal I nvestig ations stopped the trucks on I nterstate 57 in I llinois

. At the time of the stop, plaintiff’s ag ents had exclusively operated the trucks within the State of Illinois

. Additionally
, Thomas’s aff

idavit established sufficie nt fuel for the transportation of the trucks to the Kentucky border was purc hased in Spring field, I llinois

. ¶ 36 Consequently
, plaintiff’s trucks did fit within the exception established in the def inition of “commer cial motor vehicle.” Be cause the trucks wer e not considere d “commer cial motor vehicles” under the plain lang uag e of section 1.16 of the Tax L aw, plaintiff was not require d to obtain single- trip permits for the transportation of the truc ks to Tennessee

. ¶ 37 Further, plaintiff was not require d to obtain a motor-fue l-use-ta x li c e n se beca use plaintiff did not fi t wi thin the definition of “motor car rier.” Section 1.17 of the Tax L aw (35 IL CS 505/1.17 (West 2006)) define s “motor car rier” as “any person who operates or cause s to be
operated any commerc ial motor vehicle on any highw ay within [I llinois ].” Plaintiff’s trucks do not fit within this definition beca use the trucks are not considere d “commer cial motor vehicles” under se ction 1.16 of the Tax L aw. ¶ 38 I n Owner-Ope rator Indepe ndent Dri vers Ass’n v. Bower , 325 I ll. App. 3d 1045, 1053, 757 N.E.2d 627, 633 (2001), the court stated the purpose behind the motor-fue l-use tax is to “pre vent out-of-state trucke rs who drive throug h I llinois from avoiding purcha sing fuel and
paying taxes in I llinois .” Consequently
, out-of-state trucke rs are require d to purcha se either
motor fuel in Illinois or pay outstanding fuel tax to the ir base state, which will then remit a portion of the tax to I llinois as reimburse ment for the motor-fue l-use tax the trucke r would have paid if the fuel was purcha sed in I llinois

. Bower
, 325 I ll. App. 3d at 1053, 757 N.E.2d

-7-at 633.

¶ 39 Requiring plaintiff to purcha se single -trip p er m i t s i n this case would not further the
purpose behind the motor-fue l-use tax. Unlike Bower
, this case does not involve an out-ofstate resident seeking to avoid payi n g t he motor-fue l-use tax by purcha sing fuel outside I llinois and then usin g I l l i n o is roads. I nstead, this case involves an out-of-state deale rship purcha sing trucks in I llinois and then attempting to transport the trucks to its deale rship in Tenne ssee. Plaintiff was not require d to purcha se single -trip permits as reimburse ment to the State of I llinois for the motor-fue l-use t ax beca use fuel for the trucks was purcha sed in I llinois , as evide nced by

Thomas’s af

fidavit. ¶ 40 Consequently
, single -trip permits authorizing operation of plaintiff’s trucks for a sing le trip throug h I llinois wer e not require d beca use the trucks did not fit within the definition of “com m erc ial motor vehicle.” There fore
, the circ uit court’s decision aff irming the Depa

rtment’s dec ision is reverse d.

¶ 41 I I I . CONCLUSI ON ¶ 42 For the rea sons stated, we reve rse the circ uit court’s decision aff irming the Depa

rtment’s decision. ¶ 43 Reverse d.

-8-