Title: Rooney v. Horn
Citation: 174 Kan. 11, 254 P.2d 322
Docket Number: 38,671
State: Kansas
Issuer: Kansas Supreme Court
Date: March 7, 1953

174 Kan. 11 (1953)
254 P.2d 322
CHARLES ROONEY, d.b.a. Rooney Confection Service, Appellant,
v.
FRED HORN, DALE A. FISHER and C.I. MOYER, State Commission of Revenue and Taxation, and BERT E. MITCHNER, Director of Revenue and Taxation of the State of Kansas, Appellees.
No. 38,671

Supreme Court of Kansas.
Opinion filed March 7, 1953.
Charles Rooney, of Topeka, argued the cause and Charles Rooney, Jr., was with him on the briefs for the appellant.
Payne H. Edgar, of Topeka, argued the cause and Wilbur G. Leonard, of Topeka, was with him on the briefs for the appellee.
Payne H. Ratner, Ora D. McClellan, Louise Mattox, Payne H. Ratner, Jr., Keith Sanborn, Gerald L. Michaud, Russell Cranmer, Dale B. Stinson, Jr., and Starr Calvert, Jr., all of Wichita, were on the briefs as amicus curiae.
The opinion of the court was delivered by
SMITH, J.:
This was an action pursuant to G.S. 1949, 79-3602, to determine whether the appellant is required to pay a two percent tax on the gross receipts from the sale of five-cent candy bars through vending machines. The director of revenue made an assessment for the months from December, 1948, through May, 1949. The appellant appealed to the commission, where the liability was fixed at $839.21. The appellant then appealed to the district court. That court upheld the findings of the commission  hence this appeal.
There was an agreed statement of facts as follows:
The trial court found:
Judgment was entered against appellant and in favor of the commission for $839.21.
The specifications of error are that the trial court erred in entering judgment against the appellant and in making findings that under G.S. 1949, 79-3619, and the rules and regulations of the commission separate and individual five-cent candy bar sales are subject to the two percent sales tax.
The argument takes us to an examination of the sales tax from its inception. The act was enacted by the legislature in 1937. As enacted, provision was made for the payment of the tax on five-cent sales by the use of tokens. Section 19 of the Laws of 1937, Chapter 374, provided:
The legislature in 1939 repealed this section and enacted in lieu thereof G.S. 1949, 79-3619. This section provides as follows:
Pursuant to the above statute the commission issued rules and regulations in part as follows:
*14 "BRACKET SYSTEM FOR ADDING AND COLLECTING SALES TAX.
..............
"$0.01 to $0.14  No tax
.15 to .65  1¢ tax"
..............
The token system was discontinued. It will be seen the bracket system made no provision for the retailer collecting any tax on sales under 15 cents in amount. The idea of the bracket system when it was put into effect was that while a retailer could not collect any tax on sales under 14 cents in amount, ordinarily he could and would on sales of fifteen cents and over collect one cent. Thus, on four separate fifteen-cent sales he collects four cents. These two features were believed to just about balance each other or result in some slight advantage to the retailer even though he paid two percent tax on his gross receipts. In the case of vending machines such as those operated by appellant the retailer has no means by which he can balance up since his sales are all for five cents. There are no tokens now so he cannot collect less than one cent and should he set up his machine to collect a one-cent tax on each sale he would be confronted by the provision that on sales from one cent to fourteen cents there shall be no tax.
We now examine the pertinent statutes, G.S. 1949, 79-3602, subpara (d), provides in part:
Subpara (j) provides:
The tax is imposed by G.S. 1949, 79-3603. That section provides, in part, as follows:
Appellant argues that when the legislature repealed the statute providing for the tokens and provided for substitution of the bracket system, which made it unlawful to collect any tax upon five-cent sales, and left in effect the provision that `the tax levied hereunder shall be paid by the consumer' and made it the duty of the retailer to collect the tax, the effect was to free him from the obligation to pay a tax which the law makes it impossible for him to collect.
The position of appellees is that the tax is imposed upon the retailer for the privilege of doing business and is measured by his gross receipts. They argue the fact the statute declares the tax to be on the consumer has no bearing and the retailer is obliged to pay 2 percent of his gross receipts whether he can collect the total tax from the consumer or not.
G.S. 1949, 79-3603, contains in addition to the provisions already quoted a subparagraph (f) as follows:
Section 3 of chapter 374 of the Session Laws of 1937, the original sales tax act, did not contain any subparagraph (f) or any provision similar to it or of like import. There was no mention of coin operated machines.
By section 2 of chapter 463 of the Session Laws of 1947 a section (f) was added, which provided for the sales tax applying to any coin operated amusement device, whether automatic or manually operated; for example, but not by way of limitation: Pinball machines, mechanical music machines and mechanical games. This section is G.S. 1949, 79-3603.
As heretofore remarked in this opinion, these taxes were assessed from December, 1948, through May, 1949, while the above amendment was in effect. Clearly the machines of appellant are not "a coin operated amusement device."
By section 1 of chapter 497, the legislature of 1951 added to G.S. 1949, 79-3603, subparagraph (f) the words "and/or any merchandise vending machine." This was the first time a merchandise vending machine was referred to in the sales tax act. Thus *16 for the first time in 1951 did the legislature clearly indicate its intention to levy a tax of two percent upon the gross receipts from the operation of merchandise vending machines.
A careful examination of G.S. 1951 Supp., 79-3603, will be helpful. The legislature in 1937 with meticulous care included every category of business upon which it wished to levy the tax. Subparagraph (a) levied the tax on the sale of tangible personal property; (b) upon telegraph and telephone service; (c) sale of gas, water, electricity and heat; (d) upon the gross receipts of eating places generally; (e) amusement places. As we have noted, in 1947, pinball machines were added and in 1951 merchandise vending machines. Had the legislature by the original act or the amendment of 1947 intended to include merchandise vending machines it could have easily done so either in the original act or the amendment of 1947. The fact that it did not do so is persuasive that it was not the intention to include them. Certainly they were not included in subparagraph (a) which levied the tax on the sale of tangible personal property since the legislature on two subsequent occasions dealt with coin operated machines.
In the interpretation of a statute where words of definite meaning are used they exclude the use of words of a general meaning. Certainly the legislature in this case, as has been pointed out, covered the field of businesses upon which it intended a tax of two percent of the gross receipts to be levied. The maxim "expressio unius est exclusio alterius" applies. (See State, ex rel., v. Ewing, 22 Kan. 708; K.P. Rly. Co. v. Wood, 24 Kan. 619; Snavely v. Buggy Co., 36 Kan. 106, 12 Pac. 522; Beebe v. Doster, 36 Kan. 666, 14 Pac. 150; Sutherland Statutory Construction, Vol. 2, 3d ed., § 4915, p. 412; and Commerce Trust Co. v. Paulen, 126 Kan. 777, 271 Pac. 388.)
A detailed statement of the matters this court will consider in interpreting a statute is set out in Natural Gas Pipeline Co. v. Commission of Revenue &amp; Taxation, 163 Kan. 458, 183 P.2d 234. We have applied these rules to this statute and the general knowledge of the facts and circumstances surrounding the enactment and development of our sales tax act and we are forced to conclude that the legislature did not until 1951 intend that the operator of a coin operated merchandise vending machine should pay the 2 percent sales tax upon the gross receipts thereof.
The judgment of the trial court is reversed with directions to enter judgment for the plaintiff.