Opinion ID: 1760304
Heading Depth: 1
Heading Rank: 1

Heading: unexpected decision

Text: The Director and the Local Taxing Authorities claim that no refunds are due on local use taxes paid prior to the decision in AIM III because AIM III was an unexpected decision under section 143.903, which states in pertinent part: 1. Any provision of law to the contrary notwithstanding, an unexpected decision by or order of a court of competent jurisdiction or the administrative hearing commission shall only apply after the most recently ended tax period of the particular class of persons subject to such tax imposed by chapters 143 and 144, RSMo, and any credit, refund or additional assessment shall be only for periods after the most recently ended tax period of such persons. If AIM III was an unexpected decision under this statute, then refunds for all tax years prior to 1996, the year AIM III was decided, would not be authorized. However, for the reasons that follow, this Court holds that section 143.903 is not applicable. Section 144.749, the General Assembly's response to the original 1991 local use tax litigation, acts as an exception to section 143.903, the unexpected decision statute, so that section 143.903 does not apply at all in this case. There is an inherent conflict between the two statutes. Under section 143.903, if a tax decision is deemed to be unexpected, then any refund shall be only for periods after the most recently ended tax period.  Sec. 143.903.1 (emphasis added). In contrast, section 144.749 provides that in the event section 144.748 is found unconstitutional, the director of revenue may withhold an amount (implicitly for refunds to taxpayers) equal to the distribution from the local use tax fund since its inception.  Sec. 144.749 (emphasis added). Thus, section 143.903 limits refunds to periods after the determination of unexpectedness, while section 144.749 implicitly allows refunds dating back to the inception of the tax regardless of a subsequent determination of unexpectedness. Assuming arguendo that the decision in AIM III was unexpected, these sections could not be applied simultaneously because they reach contradictory results. Section 144.749 implicitly allows refunds for periods prior to the decision in AIM III while section 143.903 expressly forbids such refunds. This Court has consistently held that when two statutory provisions are repugnant, the later act ... operates to the extent of the repugnancy to repeal the first. Morrow v. City of Kansas City, 788 S.W.2d 278, 281 (Mo. banc 1990 ); see also County of Jefferson v. Quiktrip Corporation, 912 S.W.2d 487, 490 (Mo. banc 1995). However, repeal by implication is disfavored, and if two statutes can be reconciled then both should be given effect. Matter of Nocita, 914 S.W.2d 358, 359 (Mo. banc 1996). The crucial notion in applying the doctrine of repeal by implication is the extent of the repugnancy of the statutory provisions. Sections 143.903 and 144.749 are only repugnant to the extent that they concern decisions involving section 144.748. Thus, section 144.749 operates to repeal section 143.903 only in those instances where it would apply to decisions involving section 144.748. In other words, section 144.749 acts as an exception to section 143.903 regarding any decisions that pertain to section 144.748. The legislative exception recognized in this decision is analogous to the legislative exception recognized by this Court in Quiktrip, 912 S.W.2d at 490, which involved a conflict between two series of tax statutes. The first series stated that certain tax revenue received by Jefferson County was to be held in a trust fund for law enforcement and capital improvements. Id. at 488-90. A later series of statutes indicated that 50% of additional revenue generated in association with designated tax increment finance districts, which would normally have been included in the trust fund, was to be paid by Jefferson County to the City of Herculaneum. Id. This Court recognized that the statutes were inconsistent, but noted the necessity of applying both statutes to the fullest extent possible. Id. at 490. In this regard, this Court stated that [t]he only rational way to reconcile each of the statutes [was] to conclude that the legislature intended to create an exception to the [earlier group of statutes]. Id. This same line of reasoning applies in this case. Sections 143.903 and 144.749 are clearly inconsistent, but both statutes should be applied to the fullest extent possible. The only rational way to apply both statutes is to conclude that the legislature intended for section 144.749 to create an exception to section 143.903. In sum, whether the AIM III decision was an unexpected decision under section 143.903 is irrelevant because section 143.903 has been superseded by section 144.749. Hence, section 143.903 does not limit the availability of refunds in this case.