Laws, Regulations & Annotations
Business Taxes Law Guide – Revision 2017
Sales And Use Tax Court Decisions
Superior Court (Petroleum Contractors, Inc.) v. State Board of Equalization . . . (1980)
A purchaser brought an action against the State Board of Equalization seeking the recovery of sales tax reimbursement which it assertedly overpaid to its vendors who, in turn, overpaid the Board. The Board successfully moved for summary judgment on the ground that the purchaser was not the taxpayer and thus lacked standing to sue for refund of sales tax. On granting summary judgment, the trial court granted the purchaser leave to file an amended cross-complaint to bring itself within the rule of Javor v. State Board of Equalization (1974) 12 Cal.3d 790, which provides a limited exception to the general rule prohibiting suits for tax reimbursement by anyone other than the taxpayer. The Board applied for extraordinary relief, challenging as an abuse of discretion the trial court's order denying its motion to strike the amended complaint and overruling its demurrer thereto.
The court of appeal issued a writ of mandate directing the trial court to vacate its order and to enter an order granting the relief sought. The court held that, because the purchaser did not lack a remedy, the exception to the general rule was inapplicable.
The court further held that the amended complaint expressly alleged that several of the purchaser's vendors had pending administrative refund proceedings against the Board, and in the event the vendors were successful in those proceedings, any refund so obtained would be reachable by the purchaser. The court also held it was clear from the allegations in the purchaser's complaint that existing administrative remedies had not been exhausted, and that pending completion of those administrative proceedings, the trial court lacked jurisdiction. State Board of Equalization v. Superior Court (Petroleum Contractors, Inc.) (1980) 111 Cal.App.3d 568.