Court Opinion

ID: 9573983
Source: CourtListenerOpinion
Date Created: 2023-08-21 21:01:10.720562+00
Date Added: 2024-06-11T12:43:53.470412
License: Public Domain

HOWE, Associate Chief Justice:
(dissenting).
I dissent. There are several fundamental related rules of statutory construction which, when applied to section 59-15-5.1(3), support plaintiff taxpayer’s interpretation and dictate reversal of the penalty imposed by the tax commission.
We begin with the rule that the terms of a statute are presumed to have been used advisedly by the legislature. Board of Educ. of Granite School Dist. v. Salt Lake County, 659 P.2d 1030, 1035 (Utah 1983). Therefore, effect should be given to each such word, phrase, clause, and sentence where reasonably possible. Chez ex rel. Weber College v. Utah State Bldg. Comm’n, 93 Utah 538, 542, 74 P.2d 687, 690 (1937); Price v. Industrial Comm’n of Utah, 91 Utah 152, 154, 63 P.2d 592, 593 (1937). In the process of interpretation, courts may not take, strike, or read anything out of a statute or delete, subtract, or omit anything therefrom. 73 Am.Jur.2d Statutes § 200 (1974); State ex rel. Fawcett v. Board of County Comm’rs of Albany County, 73 Wyo. 69, 78, 273 P.2d 188, 196 (1954). The only exception to the latter rule is when the words of a statute are so meaningless or inconsistent with the intention of the legislature otherwise plainly expressed in the statute that they may be rejected as surplusage and omitted, eliminated, or disregarded. 73 Am.Jur.2d Statutes § 200 (1974). As I will later show, that is not the case here. The court will not construe a particular provision of a statute so as to neutralize or modify other provisions if any other construction of the particular provision is at all tenable. Miles v. Wells, 22 Utah 55, 62, 61 P. 534, 536 (1900). Courts will not undertake a correction of legislative mistakes in statutes notwithstanding the fact that the court may be convinced by extraneous circumstances that the legislature intended to enact something very different from that which it did enact. American Electric Power Serv. Corp. v. State, 619 P.2d 314 (Utah 1980) (title of act indicated legislature intended to amend a different section of the code than the section actually amended in the body of the act); State ex rel. Fawcett, 73 Wyo. at 79, 273 P.2d at 197; Farmers-Kissinger Market House Co. v. City of Reading, 310 Pa. 493, 498, 165 A. 398, 400 (1933).
When these rules of construction are applied to section 59-15-5.1(3), I cannot disregard, as does the majority, the italicized last eight words of the last sentence of that subparagraph:
In addition to any other penalties for late payment provided in section 59-15-5, *517there shall be a penalty of 10% of the total amount of the prepayment due from the date the prepayment return is due.
The majority justifies its disregard of these last eight words because in the title of the act enacting section 59-15-5.1(3) and throughout the section itself, the word “penalty” is repeatedly used. The majority apparently believes that the last eight words are inconsistent with the imposition of a penalty and therefore must be given no effect whatever. That is not true. The majority overlooks the fact that penalties for the nonpayment of taxes sometimes take the form of the imposition of interest charges on the delinquent amounts unpaid. 72 Am.Jur.2d State and Local Taxation § 856 (1974). That is exactly what the legislature has prescribed here. But the majority changes the prescribed penalty to a flat penalty by giving the last eight words no meaning or effect.
The majority also finds strength for its position in the fact that penalties prescribed in other sections of our taxation statutes impose a flat penalty and reasons that the penalty in subsection (3) must also be a flat penalty. In my opinion, each provision in our statutes imposing penalties must stand on its own wording. Admittedly, subparagraph (3) is worded differently from many other penalty provisions. However, it is not unique. Section 59-16-7.1, imposing a penalty for delinquent use tax prepayments, is worded identically to subsection (3), which is before us. Thus we have two separate statutes, one imposing a penalty for delinquent prepayment of sales tax and the other imposing a penalty for delinquent prepayment of use tax (which two taxes complement each other), which are identically worded. This similarity is persuasive that the employment of the last eight words in subsection (3) was not a one-time legislative oversight or error. To the contrary, their use indicates that the legislature in two separate sections prescribed a penalty which is computed as interest. The majority points out that the word “interest” is not used in subsection (3). Of course not. The legislature did not intend for it to be interest but to be a penalty computed as interest. See 72 Am. Jur.2d State and Local Taxation § 856 (1974). Interest is separately charged.
The majority also points out that in subsection (3) the words “per annum” do not appear following the figure of 10 percent. That is true. However, this court held in Morrison-Merrill & Co. v. Industrial Commission of Utah, 81 Utah 363, 370, 18 P.2d 295, 298 (1933), that where an omission in a statute is obvious, this court would supply a proper word to avoid an absurd result. In that case, this court was construing a formula for benefits contained in a workmen’s compensation statute. Taking the formula literally, the injured worker would have been entitled to weekly compensation in the amount of $1,385. The court noted that a figure in the formula was obviously missing a decimal point, which, if inserted, would make the weekly benefit a reasonable amount. By the same reasoning in the instant case, we can supply “per annum” following the figure 10 to avoid the absurd result which would follow if a daily, weekly, or monthly rate of 10 percent were to be used.
Another crucial rule of construction which has been ignored by the majority is that taxing statutes are to be construed strictly and in favor of the taxpayer when doubtful. Parson Asphalt Prods., Inc. v. Utah State Tax Comm’n, 617 P.2d 397, 398 (Utah 1980); Pacific Intermountain Express Co. v. State Tax Comm’n, 8 Utah 2d 144, 146, 329 P.2d 650, 651 (1958). Statutes prescribing penalties are not to be extended by mere implication. 72 Am. Jur.2d State and Local Taxation § 863 (1974). Statutes imposing penalties will not be construed to include anything beyond their letter, even though it may be within their spirit. 36 Am.Jur.2d Forfeitures and Penalties § 8 (1968). In the instant case, giving the majority opinion full credit, subsection (3) is subject to two different interpretations. I have demonstrated there is another plausible interpretation. The interpretation made by the majority produces a penalty of almost ten times that which my construction produces. The majority would impose a penalty of *518$9,287 for the taxpayer’s 38-day delinquency, whereas the interpretation which I would make produces a penalty of $966.92. I believe that where the members of this court are divided on the meaning of the statute, the taxpayer is entitled to the benefit of the doubt under the strict construction rule and should not be subjected to an extremely heavy penalty where the legislature has left doubt in the language.
STEWART, J., concurs in the dissenting opinion of HOWE, Associate Chief Justice.