Court Opinion

ID: 5059047
Source: CourtListenerOpinion
Date Created: 2021-10-01 09:01:27.317754+00
Date Added: 2024-06-11T08:19:20.763552
License: Public Domain

BLACKMAR, Judge,
dissenting.
The plaintiff Director’s uncontradicted affidavits show that an assessment was made against the defendant for $1,314,-663.20, consisting of $638,581.60 in unpaid cigarette taxes, $676,081.60 in penalties, and interest on the balance until paid. The defendant’s then attorney (not affiliated with the attorney or the firm who represented it during the trial or appeal), made an offer in compromise, and after exchanges of correspondence, a settlement agreement was pieced together calling for the immediate payment of $200,000 and payment of the balance, including interest, *863at a later date. The defendant paid the entire principal balance but did not pay the interest. The principal opinion now holds that the compromise and settlement was ineffective, on the basis that there was a “failure of consideration” because the governing statutes did not authorize the assessment and collection of any interest and penalties. I believe that the uncontradicted evidence demonstrates that there was a valid compromise agreement, supported by consideration, and that this agreement is legally enforceable.
I agree with the statement in the principal opinion that taxes, and also interest and penalties for the nonpayment of taxes, must be expressly authorized by statute. I am not at all sure, however, that the interest and penalties sought to be collected in this case were not authorized by the governing statute, § 210.320, RSMo 19691 which reads in pertinent part as follows:
4. The county cigarette tax shall be collected by the division of collection of the state department of revenue. The division shall each day retain, from the county tax collected, one percent of the amount collected and deposit that amount in the state general revenue fund to help defray the cost to the state of collecting and distributing this tax.
5. The tax shall be paid and stamps affixed in the same manner as is provided by chapter 149, RSMo, for the state cigarette tax; except that no discount shall be given any wholesaler for affixing stamps or making reports required by the division.
These provisions refer expressly to Chapter 149, entitled “Cigarette Tax,” which specifies provisions for the assessment and collection of the state cigarette tax. Section 149.060.1 authorizes interest and penalties on the state tax, in the following language:
1. Any person who fails to affix the stamps within the time and in the manner required of him by this chapter shall pay, as a part of the tax imposed by section 149.020, a penalty equal to one hundred percent of the amount of the tax to be assessed and collected with the tax by the division as sales taxes are collected, and the tax and penalty thereon shall bear interest at the rate of six percent per annum.
At the very least a substantial claim could be made that § 210.320.5, in its reference to Chapter 149, borrowed and incorporated the interest and penalty provisions of § 149.060.1. This argument is aided by pointing to the express exclusion in § 210.-320.5 of wholesellers’ discounts, which is an obvious reference to § 149.030.3. The absence of other exclusions might be considered significant.
The amendment of the statute to provide expressly for interest and penalties for failure to pay the County Cigarette Tax is of no significance in construing the statutory provisions which governed when the taxes here in question accrued.
But, in the view I take of the matter, is it not necessary for the Director to demonstrate that the penalties and interest were properly assessed. All that need be shown is that an apparently serious claim to them was made. If such a claim has been made, then an agreement to compromise is supported by valid consideration. One who enters into a valid agreement of compromise cannot avoid his obligations under the agreement by showing that he could have prevailed on the underlying claim, if it were taken to litigation. See Wood v. Kansas City Home Telephone Company, 223 Mo. 537, 565, 123 S.W. 6, 15 (1909); Weinberg v. Globe Indemnity Corporation, 355 S.W.2d 341, 346 (Mo.App.1962); 15A C.J.S., Compromise and Settlement, Sec. lib; 15A Am. Jur.2d Sec. 15, in which it is said:
... a settlement payment made when the law was uncertain cannot be successfully attacked on the basis of a subsequent resolution of the uncertainty, since otherwise the public policy of encouraging settlements would be seriously undermined.
*864We do not have to decide whether a claim which is utterly devoid of merit would support a compromise agreement. The claim made here was a substantial one. The defendant taxpayer was concerned both about the amount of the claim and about the time for payment. The taxpayer, besides liquidating the amount owed, received a delay and forbearance which was expressly bargained for and which furnishes additional consideration for the compromise agreement. This taxpayer, after obtaining an adjustment and forbearance on terms apparently satisfactory to it, should not be allowed to repudiate the obligation it deliberately assumed.
There is no reason why the Director, just as a private party, should not be able to enter into and to enforce a compromise agreement.
The conclusion in the principal opinion that the compromise agreement lacked consideration is not legally supportable. The judgment should be affirmed.

. Because of the presence of legally sufficient consideration in the forbearance of interest and penalties and in the extension of time, we do not have to consider the forbearance to seek criminal sanctions, nor whether any criminal sanctions were available.