Title: Clinchfield Coal Co. v. Robbins
Citation: N/A
Docket Number: 000700
State: Virginia
Issuer: Virginia Supreme Court
Date: January 12, 2001

Present: All the Justices 
 
CLINCHFIELD COAL COMPANY 
 
 
 
OPINION BY 
v.  Record No. 000700 
CHIEF JUSTICE HARRY L. CARRICO 
 
 
 
January 12, 2001 
RONNIE L. ROBBINS, COMMISSIONER 
OF REVENUE, DICKENSON COUNTY 
 
FROM THE CIRCUIT COURT OF DICKENSON COUNTY 
Keary R. Williams, Judge 
 
 
This case involves a declaratory judgment proceeding 
brought by Clinchfield Coal Company (Clinchfield) against Ronnie 
L. Robbins (Robbins), Commissioner of Revenue of Dickenson 
County.  In a bill of complaint, Clinchfield sought a 
declaration that Robbins lacked the authority to employ Larry D. 
Sturgill, P.C., a private accounting firm (the Sturgill firm), 
and to appoint its members as deputy commissioners of revenue to 
conduct an audit of Clinchfield’s business tax records.  
Clinchfield also sought to have the trial court quash a summons 
requiring Clinchfield to produce certain records for the 
Sturgill firm’s use in conducting the audit.  From a final 
decree denying the requested relief, we awarded Clinchfield this 
appeal. 
 
Clinchfield, an affiliate of The Pittston Company 
(Pittston), is engaged in the business of mining and processing 
coal in Dickenson County.   The County imposes a severance tax 
upon persons engaged in the business of severing and extracting 
coal in the County.  Clinchfield files monthly severance tax 
returns and pays severance taxes to the County. 
 
Robbins’ duties as commissioner of revenue include the 
enforcement of local taxes imposed by the County.  On May 27, 
1998, Robbins entered into an “Auditing Agreement” with the 
Sturgill firm.  The agreement made the Sturgill firm “solely 
responsible for providing services reasonably required to 
accomplish” work assignments involving “the acquisition of 
information necessary to conduct a random audit of the coal and 
gas severance(s) in Dickenson County.” 
 
On June 23, 1999, the Sturgill firm notified Clinchfield 
that it had been selected for an audit of the coal severance 
taxes reported to Dickenson County for the year 1998 and that 
the audit would be conducted by the Sturgill firm’s 
representatives.  The notice required Clinchfield to make 
available to the Sturgill firm’s auditors a number of its 
business records. 
 
Clinchfield objected to the performance of the audit by the 
Sturgill firm as being unauthorized.  Robbins then certified to 
the trial court his appointment of Larry D. Sturgill and four 
other members of the Sturgill firm as deputy commissioners of 
revenue and requested that they be allowed to qualify by taking 
and subscribing the oath required by law.  By orders entered 
August 31, 1999, the trial court granted Robbins’ request and  
 
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entered of record the appointments of the five members of the 
Sturgill firm as deputy commissioners of revenue.  In September 
1999, each member took the oath prescribed by Code § 49-1, the 
same oath required of “[e]very person before entering upon the 
discharge of any function as an officer of this Commonwealth.” 
 
In September 1999, a member of the Sturgill firm who 
identified herself as a deputy of Robbins contacted Pittston to 
reschedule a severance tax audit of Clinchfield’s records.  In a 
letter to the Dickenson County Attorney on October 22, 1999, 
Pittston stated that it did not question the right of Robbins or 
the employees of his office to conduct an audit of Clinchfield’s 
records but asserted that Virginia law did not permit audits by 
“independent accountants even if they purport to have been 
‘deputized.’ ”  Pittston asked the County Attorney to confirm 
that the audit by the Sturgill firm “cannot proceed.” 
 
The County Attorney responded to Pittston on October 26, 
1999, that the audit would proceed and that a subpoena would be 
issued for Clinchfield’s records.  On November 5, 1999, Robbins 
issued a summons requiring Clinchfield’s president to appear 
before Robbins on November 15, 1999, and produce a number of 
records for the severance tax audit.  Robbins intended to 
provide the records to the five members of the Sturgill firm for 
their use in performing the audit.  Clinchfield then filed its 
bill of complaint for declaratory judgment seeking, as part of 
 
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the requested relief, to have the summons quashed.  After a 
hearing, the trial court in its final decree refused to quash 
the summons. 
 
Clinchfield’s first assignment of error alleges that 
Robbins lacked the authority to hire the Sturgill firm to 
conduct a tax audit of Clinchfield’s confidential business 
records.  However, during oral argument, Robbins conceded that 
“the law in this Commonwealth is that [a commissioner of 
revenue] can’t hire a private firm, in and of itself,” to “audit 
a private citizen.”  Robbins then took the position that a 
commissioner of revenue has the authority to “hire an 
individual, as a statutory employee, from an accounting firm to 
do the work.” 
 
Clinchfield’s second assignment of error poses the question 
whether a commissioner of revenue possesses the authority to 
employ the members of a private accounting firm as deputy 
commissioners to conduct confidential tax audits.  This becomes 
the dispositive question in the case. 
 
Robbins maintains that the authority to appoint members of 
a private accounting firm derives from Code §§ 15.2-408(C), -
1603, and –1605(A).  Code § 15.2-408(C) provides that a 
commissioner of revenue “may appoint such deputies, assistants 
and employees as he may require in the exercise of the powers 
conferred and in the performance of the duties imposed upon him 
 
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by law.”  Code § 15.2-1603 provides that a commissioner of 
revenue may “appoint one or more deputies, who may discharge any 
of the official duties of their principal during his continuance 
in office.”  Finally, Code § 15.2-1605(A) defines an 
“[e]mployee” as “an employee or deputy” of, inter alia, a 
commissioner of revenue. 
 
Citing several opinions of the Attorney General, Robbins 
argues that “a constitutional officer maintains exclusive 
authority over personnel matters within his office[,] giving the 
officer the discretionary power to appoint deputies.”  See 1998 
Op. Atty. Gen. 30; 1986-1987 Op. Atty. Gen. 69; 1982-1983 Op. 
Atty. Gen. 105.  Robbins references another opinion of the 
Attorney General in aid of his position that a commissioner of 
revenue may engage “part-time employees to conduct audits.”  
1991 Op. Atty. Gen. 281. 
 
Continuing, Robbins argues that when he “deputized [the] 
five individuals,” they became part-time “statutory employees as 
defined by Virginia Code § 15.2-1605, which allows them to 
receive confidential tax information under Virginia Code § 58.1-
3(A)(2) in the line of duty to perform tax audits.”  We disagree 
with Robbins.1
 
Code § 58.1-3(A) provides in pertinent part as follows: 
 
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Except in accordance with a proper judicial order or as 
otherwise provided by law, the . . . commissioner of the 
revenue . . . or any other state or local tax or revenue 
officer or employee . . . shall not divulge any information 
acquired by him in the performance of his duties with 
respect to the transactions, property, including personal 
property, income or business of any person, firm or 
corporation. . . .  Any person violating the provisions of 
this section shall be guilty of a Class 2 misdemeanor. 
 
Subsection 2 excepts from the provisions of section A “[a]cts 
performed or words spoken or published in the line of duty under 
the law.” 
 
Code § 58.1-3(A) was the subject of the 1991 opinion of the 
Attorney General referenced above.  In that instance, the 
Attorney General was asked two questions, (1) whether a 
commissioner of revenue could engage part-time employees to 
conduct tax audits, and (2) whether a commissioner of revenue 
may employ “private firms either to conduct the audits or to 
provide personnel to work with a commissioner in conducting the 
audits.”  1991 Op. Atty. Gen. 281.  (Emphasis added.)  The 
Attorney General answered the first question by stating that 
“the confidentiality provisions of § 58.1-3 . . . are not 
violated by disseminating protected information to tax or 
revenue employees, including part-time employees, for the 
performance of their public duties.”  1991 Op. Atty. Gen. at 
281-82. 
                                                                  
1 Robbins argued on brief that the five individuals would be 
considered as employees even under the common law. However, 
 
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With respect to the second question, the Attorney General 
noted that prior opinions of her office had reached different 
conclusions when addressing whether a commissioner of revenue 
could disclose confidential tax information to third parties.  
The Attorney General then explained as follows: 
 
The different conclusions reached by these prior 
Opinions are based on the existence or nonexistence of the 
statutory authority for the third party to perform duties 
which require access to the tax information.  If such 
statutory authority exists, the information is disclosed 
“in the line of duty under the law,” as provided in § 58.1-
3(A)(2).  As a result, a commissioner of the revenue may 
disclose confidential tax information to a local tax 
collector employed by a county board of supervisors 
pursuant to the authority granted in § 58.1-3934 . . . .  
Likewise, a commissioner may provide confidential tax 
information to a local board of equalization pursuant to a 
statute, § 58.1-3379 . . . , requiring such boards to 
equalize assessments in the county and requiring local 
commissioners to call inequalities to the attention of the 
board. . . . 
 
 
In contrast, a commissioner of the revenue may not 
disclose confidential tax information to outside assessors 
engaged to audit taxpayers, to verify returns and to make 
statutory assessments for omitted items.  See 1976-1977 
Att’y Gen. Ann. Rep. 34 (the “1976 Opinion”).  The function 
of an outside assessor would be limited to appraising 
property voluntarily exhibited by the taxpayer and to 
submitting his appraised value to the commissioner.  Id. at 
35.  Based on the conclusion in the 1976 Opinion, it is my 
opinion that, because there is no statute that authorizes a 
commissioner of the revenue to engage outside auditors and 
thus to disclose confidential tax information pursuant to 
the commissioner’s or the auditor’s performance of his 
statutory duties, a commissioner is prohibited by  § 58.1-3 
from granting an outside auditing firm access to such 
information. 
 
1991 Op. Atty. Gen. at 282 (footnote omitted) (emphasis added). 
                                                                  
Robbins abandoned this position during oral argument. 
 
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Although the construction of a statute by the Attorney 
General is not binding upon this Court, it is of “persuasive 
character.”  Barber v. City of Danville, 149 Va. 418, 424, 141 
S.E. 126, 127 (1928).  We find the Attorney General’s 1991 
opinion most persuasive on the question whether there is 
statutory authority for a commissioner of revenue to engage a 
private accounting firm to conduct audits or to provide 
personnel to do the work.  And it is worthy of note that, 
although the opinion quoted above has been on the books since 
1991, the General Assembly has not seen fit to alter it in any 
way.  The General Assembly “is presumed to have knowledge of the 
Attorney General’s interpretation of statutes, and the General 
Assembly’s failure to make corrective amendments evinces 
legislative acquiescence in the Attorney General’s 
interpretation.”  City of Winchester v. American Woodmark Corp., 
250 Va. 451, 458, 464 S.E.2d 148, 153 (1995). 
 
Here, as noted supra, Robbins has conceded he lacks the 
authority to employ a private accounting firm to perform tax 
audits.  He maintains, however, that Code §§ 15.2-408(C) and –
1603 evince the legislative intent to allow commissioners of 
revenue to appoint deputies who become a commissioner’s 
statutory employees and to whom confidential information may be 
divulged “in the line of duty,” consonant with Code § 58.1-
 
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3(A)(2).  But we cannot find the legislative intent Robbins 
ascribes to Code §§ 15.2-408(C) and –1603.  Indeed, given the 
circumstances of this case and the confidentiality provisions of 
Code § 58.1-3(A), we cannot perceive that the General Assembly 
intended to allow a commissioner of revenue to overcome the lack 
of authority to hire a private accounting firm by appointing the 
members of such a firm as deputy commissioners to conduct 
confidential tax audits. 
 
The circumstances of this case are undisputed.  During oral 
argument, Robbins acknowledged that his “Auditing Agreement” 
with the Sturgill firm was “still in effect,” that it “never was 
set aside or altered or amended in any fashion.”  And, when 
Robbins was asked during his testimony below, “does your 
agreement run to [Larry Sturgill’s] firm or does it run to these 
individuals,” Robbins stated that the agreement “basically 
covers him or his employees.” 
 
Thus, pursuant to the agreement, the Sturgill firm and its 
members, in the performance of services for Robbins, “shall 
operate as and have the status” of independent contractors and 
“shall not act or be” employees of Robbins “for any purpose.”  
The Sturgill firm’s members are not entitled to workers’ 
compensation or other benefits provided to Robbins’ regular 
employees.  Robbins does not pay the salaries of the Sturgill 
firm’s members.  Instead, he pays the firm an hourly rate for 
 
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audit services based upon monthly bills submitted by the firm 
and the firm compensates the members.2  When Robbins was asked 
below whether the five people he had named as his deputies were 
“full-time employees” of the Sturgill firm and “on [the firm’s] 
payroll,” he replied in the affirmative. 
 
This case requires application of the well-known maxim that 
a person may not do indirectly what he cannot do directly, 
Phillips v. Schools, 211 Va. 19, 22-23, 175 S.E.2d 279, 281 
(1970).  Accordingly, we will reverse the judgment of the trial 
court and enter final judgment in favor of Clinchfield declaring 
that Robbins lacked the authority to appoint the members of the 
Sturgill firm as deputy commissioners of revenue.  Our judgment 
will also quash the summons requiring Clinchfield to produce its 
business tax records for use by the members of the Sturgill 
firm. 
Reversed and final judgment. 
                     
2 Robbins testified below that he secured funds from the "Coal 
Road Committee" to finance his coal severance tax audits.  He 
said there is such a committee "in all the coalfield counties," 
and the committees distribute funds derived from "the coal and 
gas severance" tax.   
 
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