Florida/Georgia Personal Injury & Workers Compensation

...nd and Title Corporation v. Department of Revenue, 320 So.2d 815 (Fla. 1975), and Associated Dry Goods Corp. v. Department of Revenue, 335 So.2d 832 (Fla. 1st DCA 1976), upon the issues of: (1) whether imposition of the 100% penalty assessment under Section 201.17(2), Florida Statutes (1975), [1] is mandatory; and (2) whether the district court's reduction of the 100% penalty from $55,649.70 to $5,000 was proper in the instant case....

...However, the district court reduced the penalty assessment of $55,649.70, noting: Though petitioner's proof failed, it took a substantial position and advanced it in good faith with significant supporting evidence. The question was fairly debatable. If the amount of the penalty assessed pursuant to § 201.17(2), F.S., is a matter generally within the discretion of the Department, the record contains no evidence that the Department exercised informed discretion before acting to assess a $55,649.70 penalty....

...y burden of payment. It is clear, therefore, that it was improper for the Department to treat the $1,300,000 as consideration or assess documentary stamp tax with respect thereto. The taxpayer contends that imposition of the 100% penalty pursuant to Section 201.17(2), Florida Statutes (1975), for failure to affix proper documentary stamps to a deed of conveyance is discretionary with the Department. Neither the language of Section 201.17(2) nor the decisions interpreting that provision support the taxpayer's proposition....

...owed but not paid at the time of recording. (Emphasis supplied) 320 So.2d 815, 816. Accord, Associated Dry Goods Corporation v. Department of Revenue, supra. It is evident, therefore, that imposition of the 100% documentary stamp penalty pursuant to Section 201.17(2), Florida Statutes (1975), is mandatory. The taxpayer alternatively suggests that Ch. 77-281, Laws of Florida, [4] rather than Section 201.17(2), Florida Statutes *358 (1975), controls as the former constitutes the prevailing law at the time of appellate disposition. Ch. 77-281, Laws of Florida, amended Section 201.17(2) to provide for a 100% penalty "[i]f it is determined by clear and convincing evidence that any part of a deficiency is due to fraud." In all other cases, a penalty equal to 25% of the purchase price of the stamps not affixed shall be assessed....

...Furthermore, it is implicit in subparagraph (3) that the Department has no authority to compromise any assessment which had become final on the effective date of Ch. 77-281. The Department properly concedes the inherent power of the courts to reduce or modify a documentary stamp tax penalty imposed pursuant to Section 201.17(2), Florida Statutes (1975)....

...ount for purchase of the requisite tax stamps. Despite appellant's good faith failure to record the deed with the appropriate tax stamps affixed thereto, we found insufficient equities to warrant reduction of the $21,230 penalty assessed pursuant to Section 201.17(2)....

...A major portion of appellant's sales were made pursuant to revolving charge accounts, upon which no documentary stamp taxes were paid. The Department of Revenue assessed a tax upon the charge account obligations pursuant to Section 201.08(2), Florida Statutes (1975), [5] and a penalty in like amount under Section 201.17(2), Florida Statutes (1975)....

...On review in the District Court of Appeal, First District, appellant noted that Section 201.08(2) provides that no documentary stamps *359 are required to be attached to obligations to pay, executed under retail charge accounts. Therefore, the provisions of Section 201.17(2)(b), Florida Statutes (1975), which states that "[p]ayment of penalty to the Department of Revenue equal to the purchase price of the stamps not affixed " were inapplicable, since the subject stamps were not required to be affixed. (Emphasis supplied) The district court in Associated failed to accept appellant's interpretation of Section 201.17(2)(b), Florida Statutes (1975). Although a literal interpretation of Sections 201.08(2) and 201.17(2)(b) supported appellant's position, the court construed the latter provision to be inconsistent with appellant's contention, holding that: [T]he legislature intended that those who failed to timely purchase required documentary stamps, wheth...

...entary stamp tax, such belief, without more, will not warrant reduction of the penalty. In addition, the fact that the amount of the penalty was $55,649.70 does not, alone, support the taxpayer's contention that the assessment was inequitable. Under Section 201.17(2), Florida Statutes (1975), the percentage penalty is the same in each case — it increases in direct proportion to the amount of documentary stamps not affixed....

...ded to the district court for remand to the Department of Revenue with directions to reduce the tax and penalty assessment in accordance with this opinion. It is so ordered. ADKINS, Acting C.J., and BOYD, ENGLAND and HATCHETT, JJ., concur. NOTES [1] § 201.17(2), Fla....

...Dickinson, supra. [3] For the purpose of clarity, Zuckerman-Vernon Corporation will hereinafter be referred to as the taxpayer, and the Department of Revenue, as the Department. [4] Ch. 77-281, Laws of Florida, reads: "Section 1. Subsections (2) and (3) of section 201.17, Florida Statutes, 1976 Supplement, are amended to read: "201.17 Penalties for failure to pay tax required....

...In Count II of the Complaint, Appellant alleged that the Department of Revenue had assessed and demanded payment from it of additional documentary stamp and intangible taxes and penalties as a result of the subject transactions; that these additional taxes were improper and illegal; that the penalties assessed under Section 201.17(2)(b), Florida Statutes, were unconstitutional; and that neither the Appellee-Comptroller nor the Appellee-Department of Revenue should be permitted to collect such additional taxes and penalties....

..."(e) On or about November 21, 1973, defendant informed plaintiff that an assessment in the amount of $2,200 was due and owing on the documentary surtax stamps pursuant to F.S. 201.021 and that in addition a penalty assessment in a like amount was made pursuant to F.S. 201.17(2), for a total sum of $4,400....

...its motion to dismiss, for lack of subject matter jurisdiction and improper venue, an action initiated by appellees James S. and Patricia A. Crisp. *405 Appellees brought this action for a declaratory judgment alleging that Fla. Stat. § 201.02 and § 201.17 are not applicable to the subject matter of the conveyance upon which the Department assessed additional documentary stamp taxes and that Fla. Stat. § 201.17 violates the equal protection and due process clauses of the constitutions of Florida and the United States....

...Woods, Woods & Johnston, Tallahassee, for Utica Mut. Ins. Co., amicus curiae. E. Jackson Boggs and Thomas W. Black, Tampa, for The Florida Bar (Tax Section), amicus curiae. BOYD, Justice. We here consider a direct appeal from an order of the Circuit Court of Dade County holding constitutional [1] Section 201.17(2), Florida Statutes....

...llant was notified of the omission and thereafter re-recorded the deed on October 9, 1973, with the proper stamps appended. On October 26, 1973, the Department of Revenue assessed a penalty in the amount of $21,230 pursuant to the provisions *817 of Section 201.17(2), Florida Statutes, as a result of Appellant's failure to purchase the stamps at the initial recording of the deed; Appellant refused to pay the penalty. Suit was filed in the Circuit Court alleging estoppel and challenging the constitutionality of Section 201.17(2), Florida Statutes; that court denied the plaintiff's estoppel argument, expressly upheld the constitutionality of the challenged statute and ordered payment of the penalty as assessed. This appeal followed. There are two questions to resolve, i.e.: (1) Whether Section 201.17(2), Florida Statutes, is unconstitutional in that it: [a] assesses such a harsh and unreasonable penalty as to constitute a denial of due process of law as guaranteed by the Fourteenth Amendment to the Constitution of the United States...

...[5] Appellee relies on foreign case authority upholding the state legislatures' discretion in imposing penalties of up to 100% for failure to comply with a tax statute. [6] Further, *818 Appellee asserts that, due to the difficulties involved in collecting delinquent documentary stamp taxes, the penalty established in Section 201.17(2), Florida Statutes, is fully warranted....

...Appellee submits that the challenged statute is entitled to a presumption of validity and that any doubt as to its constitutionality must be resolved in favor of the statute. [7] Appellee concludes that Appellant has not met the burden for invalidating the statute. It is our view, and we so hold, that Section 201.17(2), Florida Statutes, is constitutional....

...ed cases involving statutes providing for a 100% penalty and have not found them unduly harsh. [11] Furthermore, being mindful of the difficulties involved in collecting delinquent documentary stamp taxes, we do not feel that the penalty assessed by Section 201.17(2), Florida Statutes, is so harsh or oppressive as to warrant judicial intrusion into the Legislature's determination of what constitutes a reasonable penalty in this field....

...tentions and attitudes of taxpayers. Although we recognize the severity of the penalty herein, we do not find the law unconstitutional. If the law is too harsh, it should be changed by the Legislature and not by this Court. We hold the provisions of Section 201.17(2), Florida Statutes, to be constitutional....

...As I then indicated and now reiterate, neither the letter nor the spirit of the Code of Judicial Conduct suggests that my prior affiliation with the Florida House of Representatives requires disqualification in this case. NOTES [1] Article V, Section 3(b)(1), Florida Constitution. [2] "201.17 Penalties for failure to pay tax required....

...m. It was incumbent upon appellant, when he accepted the deed from his grantor, to pay the excise tax on deeds then required of purchasers by section 201.02, Florida Statutes (1975). In fact, the failure to pay the tax would have been a misdemeanor. § 201.17, Fla....

...Gen., and Larry Levy, Asst. Atty. Gen., for respondent. RAWLS, Judge. By petition for review of final agency action, Associated Dry Goods (Robinson's) challenges a penalty imposed by the Department of Revenue (Department) pursuant to the provisions of Florida Statute 201.17(2)(b)....

...In March of 1975, the Department audited all revolving charge account sales which had been made by Robinson's since September, 1973. As a result of this audit, the Department issued a proposed notice of assessment of tax in the sum of $17,925.00 (Florida Statute 201.08[2]) and a penalty in a like sum (Florida Statute 201.17[2])....

...Robinson's contested the assessments in an administrative proceeding (Chapter 120, Florida Statutes), and the hearing officer entered a recommended order which upheld the validity of the assessment of documentary tax (F.S. 201.08[2]) and rejected the applicability of the penalty (F.S. 201.17[2])....

...In this review, *833 Robinson's challenges only the assessment of the penalty in the sum of $17,925.00, on the ground that the penalty assessment is without legal authority. In support of its contention, Robinson's correctly asserts that the sole statutory authority for imposition of same is found in Florida Statute 201.17 which provides, in pertinent part, as follows: "(2) Any document, instrument, or paper upon which the tax under this chapter is imposed and which, upon audit or at time of recordation, does not bear the proper value of stamps shall subject the...

...by law to be affixed to such instruments? The answer, quite simply is none." In rebutting Robinson's argument, the Department emphasizes that Robinson's construction would result in an absurd result. As pointed out by the Department, Florida Statute 201.17(2) provides that "[a]ny document, instrument, or paper upon which the tax under this chapter is imposed and which, upon audit ......

...to the purchase price of the stamps not affixed. Robinson's syllogism is basically that Florida Statute 201.08(2) states "[n]o documentary stamps shall be required to be attached" to the subject document; therefore, the provision of Florida Statute 201.17(2)(b) which states that "[p]ayment of penalty to the department of revenue equal to the purchase price of the stamps not affixed" (emphasis supplied) is inapplicable, since the subject stamps were not to be affixed....

...That is why it requires evidence of the payment of the tax prior to recordation of any taxable instrument. The state has elected to enforce its taxes on unsecured promissory notes, however, through the use of its criminal laws and substantial penalties. See, e.g., § 201.17, Fla....

...; payment of tax not paid; payment of penalty to department of revenue in the amount of 25% of the tax not paid, in the absence of fraud, and 100% of the tax not paid if fraud is involved; and payment of interest at a specified rate. Fla.Stat. *1444 § 201.17 (1983)....

...AFF did not pay a penalty for the delayed payment of the tax. Here, again, the plain language of Section 201.08 is conclusive. This section clearly precludes enforcement of the note until the tax due thereon has been paid. A penalty for late payment is provided for separately in section 201.17(2).1 The statute does not 1 Section 201.17(2) of the Florida Statutes provides that "[i]f any document, instrument, or paper upon which the tax under this chapter is imposed, upon audit or at time of recordation, does not show the link payment of that penalty to enforceability of the note, and nothing in the Florida case law supports such a construction....

...ys, with an additional 10 percent of any unpaid tax for each additional 30 days, or fraction thereof, during the time which the failure continues, not to exceed a total penalty of 50 percent, in the aggregate, of any unpaid tax.... " Fla. Stat. Ann. § 201.17(2) (West 1999). 2 A holder in due course takes an instrument free from defenses which might have been available between the original parties....

...That is why it requires evidence of the payment of the tax prior to recordation of any taxable instrument. The state has elected to enforce its taxes on unsecured promissory notes, however, through the use of its criminal laws and substantial penalties. See, e.g., § 201.17, Fla....

...Intervenor PIP asserts its continued willingness to pay the approved wage increases. It appears that the CISC refuses to approve a contract for wages until the parties to the agreement agree to the new wage terms authorized by the CISC. It is implicit in both Pay Board Ruling 34 and Section 201.17 of the Pay Board Regulations that payments approved by CISC may be made....

3296 (January 29,1992) (codified at 37 C.F.R. § 201.17(k)).4 In its analysis, the Office roundly criticized

...ior to recordation. The Court agrees with the court below that until appellant purchased and affixed the *397 required documentary stamps, it was in violation of Florida law and was liable for the penalties imposed by the legislature of Florida. See § 201.17(1) Fla.Stat....

...The Court has not overlooked the obvious dissimilarity between the Florida and Tennessee recording statutes. It is significant that Tennessee provides no criminal penalties for failure to pay the documentary stamp tax. Cf. T.C.A. § 67-4102, Item S(b), with § 201.17(1), Fla.Stat....

punishment as a misdemeanor of the second degree. § 201.17. Statutes imposing taxes must be construed strictly

have to pay the interest penalty set forth in Section 201.17(2)(c), Florida Statutes, on a property transaction

Zuckerman-Vernon Corporation, supra, is controlled by Section 201.17(2), Florida Statutes (1975) as it read before

the amount of the penalty assessed pursuant to § 201.17(2), F.S., is a matter generally within the discretion

found in s. 201.17(2), F. S. 1975? SUMMARY: Section 201.17(2), F. S. 1975, the documentary stamp tax penalty

tax, the stamps were omitted. By the terms of Section 201.17, Florida Statutes (1975) one who makes or receives

08 plus a penalty of like amount pursuant to F.S. 201.17. An administrative hearing was held pursuant

...delayed payment of the tax. Here, again, the plain language of Section 201.08 is conclusive. This section clearly precludes enforcement of the note until the tax due thereon has been paid. A penalty for late payment is provided for separately in section 201.17(2).1 The statute does not link payment of that penalty to enforceability of the note, and nothing in the Florida case law supports such a construction....

...turn to the question of whether Lake Forest is entitled to a set-off resulting from any viable affirmative defense. We note initially that because AFF has admitted that it is not a holder in due course, Lake Forest is entitled to assert all of the 1 Section 201.17(2) of the Florida Statutes provides that “[i]f any document, instrument, or paper upon which the tax under this chapter is imposed, upon audit or at time of recordation, does not show the proper amount of tax paid, or if the tax impo...

...ith an additional 10 percent of any unpaid tax for each additional 30 days, or fraction thereof, during the time which the failure continues, not to exceed a total penalty of 50 percent, in the aggregate, of any unpaid tax. . . . ” Fla. Stat. Ann. § 201.17(2) (West 1999). -6- defenses, including counterclaims and set-offs, that it might have asserted against any original party to the note.2 See United States v....

forwarded to the property appraiser. . . .2 Section 201.17, Florida Statutes, imposes criminal penalties