Opinion ID: 2112331
Heading Depth: 1
Heading Rank: 3

Heading: Rowe's Vermont Contacts

Text: The facts of the present case split down the middle the distinctions that the Supreme Court has made in Miller Brothers and its offspring. The assessment at issue covers the period from October 1969 through 1977. The parties have stipulated, however, that the calendar years 1976 and 1977 are to be used as test years for all purposes pertinent to this appeal. Rowe is not registered to do business in Vermont, nor does it have a resident agent, office, or telephone listing in the state. It did, however, avail itself of Vermont-based media, The Bellows Falls Shopper, and Springfield radio station WCFR, in its advertising during the two year test period. During that period, Rowe also advertised in New Hampshire-based media, including one radio station and four newspapers, all of which circulated in both the Vermont and New Hampshire markets. Rowe's Vermont newspaper advertising costs amounted to $1,335 or 21% of its total newspaper advertising budget in 1976, and $2,032 or 25% of its total newspaper advertising budget in 1977. Its Vermont radio costs amounted to $276 or 15% of its total radio costs in 1976, and $368 or 15% of its total radio costs in 1977. Rowe discontinued all of its advertising in Vermont-based media by year end 1977. Rowe delivers in its own truck furniture and carpet into Vermont. In this regard, we note that Rowe takes advantage of roads built and maintained by the state of Vermont. The deliveries are often made C.O.D., and trade-ins of used furniture may be picked up in Vermont, with the purchaser receiving a credit against the price of the new goods. The total amount of sales made and services performed by Rowe in Vermont was $29,104 or 18% of its total receipts in 1976, and $31,523 or 18% of its total receipts in 1977. Rowe also offers installation services to its customers, the cost of which is normally included in the overall purchase price, although it will be stated separately on the request of the customer. Should the customer decide to have Rowe install the goods, it contracts with a New Hampshire-based installer to do the work and attempts to get a down payment to cover the cost of installation. During 1976, services performed by Rowe in Vermont amounted to $379.05 or 14.3% of its total services, and during 1977, similar services amounted to $1,228.20 or 29% of Rowe's total services. Included within these amounts was a job that Rowe contracted to do for Mental Health Services of Vermont, a tax-exempt organization. Rowe subcontracted out the job which involved wall repair, painting, and installation of floor covering in the Service's Bellows Falls, Vermont, building. In those cases where a customer needed financing for the sale, Rowe would first advise him to investigate possibilities at his own bank, but if that financing proved unavailable, Rowe would provide assistance in obtaining financing through a local New Hampshire bank. In about 10% of its sales, however, Rowe did its own financing and retained a security interest in the property that was financed. No finance statement was filed in Vermont, since, under 9A V.S.A. § 9-302(1)(d) and 382-A N.H.Rev. Stat.Ann. § 9-302, a filing is not necessary to perfect. Moreover, on one occasion in 1977, Rowe repossessed goods in which it had a security interest by bringing an action in the Windsor Superior Court in Vermont, and by using the services of the Windsor County Sheriff. In light of the substantial connections with Vermont, we do not believe that either the Due Process Clause or the Commerce Clause requires a reversal of the superior court's decision. Nor do we believe, as Rowe argues, that Miller Brothers compels a different result. In Miller Brothers, the Court struck down Maryland's attempt to require the seller to collect a use tax because, in part, the state could not constitutionally exact a sales tax on the same sales. But, as we have seen, the Supreme Court has apparently repudiated this reasoning, and has held that a lesser presence is sufficient to require a seller to collect a use tax than to pay a sales tax. National Geographic Society v. California Board of Equalization, supra, 430 U.S. at 557-58, 97 S.Ct. at 1390-91; McLeod v. J. E. Dilworth Co., supra, 322 U.S. at 330, 64 S.Ct. at 1025. Nor are we presented here with the uncertainty of designation of the goods sold over the counter that so bothered the majority in Miller Brothers, for the state of Vermont seeks to require Rowe to collect a use tax only on those sales in which it delivers the goods in its own truck into Vermont. See National Geographic Society v. California Board of Equalization, supra, 430 U.S. at 561-62, 97 S.Ct. at 1392-93; Scripto, Inc. v. Carson, supra, 362 U.S. at 212, 80 S.Ct. at 622. Furthermore, the fact that Rowe availed itself of the use of Vermont roads in its deliveries, Vermont media in its advertising, and the Vermont court system and a Vermont county sheriff's office in its business dealings leads us to conclude that Vermont has given something for which it can ask return.