Court Opinion

ID: 9690628
Source: CourtListenerOpinion
Date Created: 2023-08-24 19:27:13.32048+00
Date Added: 2024-06-11T18:15:55.383648
License: Public Domain

OPINION ON APPELLANT’S MOTION FOR REHEARING
On December 9, 1999, one day after our opinion in this case issued, the Texas Supreme Court withdrew its June 30, 1999 opinion in Fleming Foods v. Rylander and issued a replacement. See Fleming Foods v. Rylander, 6 S.W.3d 278 (Tex.1999). In her motion for rehearing, Serna argues that:
1. This Court’s opinion is in direct conflict with Supreme Court of Texas precedent;
2. We should look solely to Serna’s pleadings in deciding whether the trial court has jurisdiction in this case; and
3. Allowing a taxpayer to seek a refund from the retailer in a class action proceeding is more efficient than requiring the taxpayer to seek the refund from the comptroller.
Discussion on Motion for Rehearing
Serna alleges that we “did not have the benefit of the ... reissued and revised decision in Fleming Foods v. Rylander.” Serna asserts that Fleming Foods v. Rylander instructs “that the proper method for recovering illegally collected taxes is from the retailer.” We disagree with Ser-na’s reading of the revised opinion.
The “opening sentence” of Fleming Foods states the issue before the court: “The issue in this case is whether a taxpayer who pays sales tax to a vendor rather than directly to the State [an indirect taxpayer] may request a tax refund from the State without receiving an assignment of refund rights from the vendor.” Fleming Foods, 6 S.W.3d at 279 (emphasis added). In the next sentence, the court held that the Texas Tax Code permits “an indirect taxpayer to pursue refunds without first obtaining an assignment from the vendor who collected and remitted the tax.” Id. (emphasis added) Fleming does not say, as Serna contends, that the groper method for recovering illegally collected taxes is from the retailer.
Serna argues that an important result of Fleming is that the “method of collection is left to the taxpayer’s election.” Again, we disagree. Fleming allows “an indirect taxpayer ... to seek refunds of sales tax from the State.” Id. at 287. Alternatively, such a taxpayer may seek an assignment of the right to obtain a refund from the vendor and then file a claim with the Comptroller of Public Accounts. See Tex. Tax Code Ann. § 111.104 (Vernon Supp.2000). In either scenario, aggrieved taxpayers ultimately seek their desired refund from the Comptroller. In short, the supreme court’s reissued opinion does not change the result in the case before us.
In our previous opinion, we did not state that the enactment of the Texas Tax Code “abolished common-law fraud claims.” We construed Serna’s claim of fraud as a claim for a sales tax refund. See Serna, 21 S.W.3d 301, 303-06. Because her suit *337amounted to a claim for a tax refund, she should have filed the claim with the Comptroller. Even if we accept her pleadings as true, her intent is to obtain a replacement of the funds that she overpaid in the form of sales tax. She filed a claim for a sales tax refund that was cloaked in the form of a common-law fraud cause of action. See id. at 303 (noting that Serna sought “actual damages; pre-judgment interest at the highest legal rate and costs of court incurred”).
Serna suggests that aggrieved taxpayers file their claims for sales tax refunds against vendors. We do not see the wisdom in such a plan, particularly if the vendor has not sought a refund of the funds (as is the case here) from the Comptroller. Serna’s argument that “[i]t would cost the taxpayer more to get his refund” from the Comptroller than from the vendor is without merit. Pursuing a claim with the Comptroller obviates the need to file suit (which normally involves attorney fees) and incur court costs.
Conclusion
We deny Serna’s motion for rehearing.