Ready Trucking, Inc. v. Bp Exploration & Oil Company

548 S.E.2d 420 (2001)

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Nature of the Case

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Facts

D has been a customer of D and regularly purchased diesel fuel from D. When the account was established, P sent to D a Georgia ST-5 Sales and Use Tax Certificate which provided that P was exempt from taxation on the purchase of certain enumerated goods. Between April 1, 1994, and December 31, 1996, P made approximately 150 separate purchases of diesel fuel from D. For each sale, D sent an invoice showing the price, amount of diesel fuel being purchased, and the various taxes included in each transaction. By law, as the agent collecting taxes on behalf of the State, D was required to collect and remit all applicable taxes owed on its sales. D did not collect or remit a required one percent state sales tax and a one percent local tax because D mistakenly believed, based on P's ST-5 Certificate, that P was exempt from having to pay these two taxes on diesel fuel purchases. The Georgia Department of Revenue discovered the error. The Department billed P a $25,560.55 assessment in back taxes owed for fuel purchased by P from D during that period as well as $12,240.91in penalties and interest. P sued D for breach of contract. P claims that D agreed to a purchase price that included 'all applicable sales tax.' Both parties moved for summary judgment. D offered copies of the approximately 150 invoices, each of which indicates the gallons delivered, purchase price, freight, and taxes withheld by category. Each invoice shows that D was withholding federal tax and three percent as a 'SECOND MOTOR FUEL TAX,' each invoice also plainly shows that the two taxes at issue were not being withheld. each invoice also stated: 'GA LOCAL SLS TAX EXEMPT' and the 11-digit number of P's ST-5 exemption certificate. D got the verdict and P appealed.