Document Number
10-258
Tax Type
Retail Sales and Use Tax
Description
Court Case
Topic
Court Case
Date Issued
10-25-2010

VIRGINIA:
IN THE CIRCUIT COURT OF FAIRFAX COUNTY

INTERNATIONAL PAPER COMPANY )
d/b/a Xpedx, )
Plaintiff, )
)
            • - vs - ) Case No. CL-2009-360
)
COMMONWEALTH OF VIRGINIA )
Department of Taxation, et at., )
)
                        • Defendants. )

FINAL ORDER


This matter comes before the Court on the application for correction of assessment ("application") filed by the plaintiff, International Paper Company, doing business as Xpedx. ("Xpedx"), the answer filed by the defendants, the Commonwealth of Virginia, Department of Taxation and Janie E. Bowen (collectively, "the Department"), the parties' pretrial briefs, the evidence and argument presented by the parties at the trial of this matter held on February 1-3, 2010, and the post-trial briefs submitted by the respective parties. Having previously denied the parties' respective motions for summary judgment and granted the Department's motion to strike Count II of Xpedx's application, the Court, at a hearing held on July 21, 2010, announced its findings of fact and conclusions of law with respect to Counts I and III of Xpedx's application.
For the reasons that the Court stated on the record at the July 21, 2010 hearing in this matter, which shall be adopted by and incorporated into this Final Order, the Court hereby dismisses Count I of Xpedx's application with prejudice.

With respect to Count III of Xpedx's application, the Court hereby adopts and incorporates into this Final Order the findings of fact and conclusions of law pertaining to Count III that the Court announced at the July 21, 2010 hearing in this matter, and adopts the following rule, which the Court has applied to reach its conclusions in this matter.
This Court holds that a dealer can satisfy its burden of good faith and reasonable care and judgment in taking a certificate to the effect that the property purchased is exempt if:
  • Upon a facial examination of the certificate, a dealer could reasonably conclude that the items purchased could potentially be used for any of the exempt purposes claimed on the certificate of exemption; or
    Based upon the actual dealer's knowledge of the business of its purchaser, the dealer could reasonably determine in good faith that the specific purchaser intended to use the items purchased for one or more of the exempt purposes claimed on the certificate of exemption.
Wherefore, based on the foregoing, and pursuant to Code § 58.1-1826; the Court orders that the assessment at issue in this matter shall be reduced as follows:
1. Reduction due to items conceded during trial: $ 2,747.92
2. Reduction resulting from this Court's holding: 40,936.05
Total Reduction in Assessment: $ 43,683.97
Therefore, the final Remaining Assessment is $103,428.52

Nothing further remaining to be done herein, this matter is stricken from the Court's docket, to be indexed among the ended actions at law. Pursuant to Code § 58.1-1826, the Clerk shall certify a copy of this Final Order to the Tax Commissioner. The Clerk shall likewise furnish certified copies this Final Order to counsel of record for the respective parties.

                    • ENTERED THIS 29 DAY OF JULY, 2010.



_______________________________
                        • JUDGE


SUBJECT TO THE DEPARTMENT'S OBJECTIONS
NOTED BY THE COURT, WE ASK FOR THIS:


_________________________________
Cynthia H. Norwood (VSB # 23094)
Senior Assistant Attorney General
Thomas W. Nesbitt (VSB # 73262)
Assistant Attorney General
OFFICE OF THE ATTORNEY GENERAL OF VIRGINIA
900 East Main Street
Richmond, Virginia 23219
Telephone: (804) 786-8192
Facsimile: (804) 692-1647
Counsel of the Commonwealth of Virginia
Department of Taxation



SEEN AND AGREED:

_________________________________
Kenneth H. Silverberg (VSD # 13636)
Cynthia Fleming Crawford (admitted pro hac vice)
NIXON PEABODY LLP
401 9th Street, NW, Suite 900
Washington, DC 20004-2128
Telephone: (202) 585-8322
Facsimile: (866) 947-36931
Counsel for International Paper Company, d/b/a Xpedx


                    • A COPY TESTE:
                      JOHN T. FREY, CLERK
                    • BY: Lorena Garcia
                      Deputy Clerk

                      Date: October 25, 2010
                      Original retained in the office of
                      the Clerk of the Circuit Court of
                      Fairfax County, Virginia


Rulings of the Tax Commissioner

Last Updated 08/25/2014 16:46