Opinion ID: 1728912
Heading Depth: 1
Heading Rank: 2

Heading: Proceedings in Lower Courts

Text: After trial on the merits, the trial court concluded that the gaming equipment did not qualify as component parts of the vessel under La.Rev.Stat. 47:305.1A. However, the court ruled that the Department was equitably estopped from collecting the tax. Although the court acknowledged the only real harm occasioned by plaintiffs was the payment of interest, the court concluded that La.Rev.Stat. 47:1601 was a mandatory all-or-nothing statute that inseparably linked interest and taxes. [3] The court thus ordered the Department to refund to plaintiffs both the taxes and the interest paid under protest. On the Department's appeal, the intermediate court, using a judicially-adopted heightened standard for determining applicability of equitable estoppel in cases involving a state entity, concluded that the doctrine applied in this case. 98-2882 (La.App. 1st Cir.2/18/00), 752 So.2d 390. The court also acknowledged that the 1985 codification of detrimental reliance in La. Civ.Code art. 1967 limits the remedy to the harm incurred and that interest was the only harm plaintiffs incurred. Nevertheless, the court agreed with the trial court's interpretation of La.Rev.Stat. 47:1601 and concluded that both taxes and interest are always due, or not due, together, and that since interest cannot be collected, taxes also cannot be collected. Accordingly, the court held that the trial court's assessment is correct in that the interest and the tax must be levied together or not at all. 98-2882 at p. 8, 752 So.2d at 395. The dissenting judge disagreed with the majority's reasoning on the latter point and would have limited plaintiffs' recovery to the interest incurred. On the Department's application, we granted certiorari. 00-1227 (La.6/16/00), 763 So.2d 612.