The Lafayette Parish School Board has suffered another legal setback at the hands of the Third Circuit Court of Appeal, which ruled this week that a Lafayette entrepreneur whose restaurant went out of business is not personally liable for sales taxes the business failed to pay to the school system.
In the case of Lafayette Parish School Board versus Reginald Simmons, et al, the appeals court reversed a lower court ruling awarding the board a $12,468 judgement against Simmons, whose company, AJS Investments, LLC, operated the Original Italian Pie in Lafayette. The restaurant opened in October 2007. AJS Investments filed for bankruptcy in February 2008 and the restaurant closed in April 2008.
Court documents show that the restaurant did not pay sales taxes to the school board during the time it was open. However, the Third Circuit ruled that the school board failed to meet the benchmarks for proving that Simmons was personally responsible for the business’ tax liability: “Considering that taxing statutes are strictly construed against the taxing authority, we do not find, under the facts of this case, that the School Board met its burden of showing the taxes were collected and willfully not remitted. Therefore, the trial court’s judgment in favor of the School Board is reversed,” Judge Sylvia R. Cooks writes in the ruling.
The loss is the most recent of three defeats for the school board at the appellate level this year. In February, the Third Circuit reversed a lower court ruling and ordered the board to return more than $443,000 in use taxes assessed to Scientific Drilling International Inc. for equipment stored in Lafayette Parish but not used in the parish. Scientific had paid the taxes under protest and appealed to the Third Circuit.
Also in February, the appeals court released a judgment upholding a lower court ruling finding that the board cannot sue an architectural firm for water intrusion problems at N.P. Moss Middle School.
Wonder how much the school system paid in legal fees to bring a $12,000 case to court twice?
... written by Huh? , March 18, 2010 - 08:26 pm
If Hmmmm decides to read the article, he will see that the school system won the case in District Court - so that was a good investment in legal fees. It was the ever-so-disappointing 3rd Circuit Court of Appeals that reversed it. The School System has an obligation to take reasonable measures to collect the taxes owed to it. If they didn't take such action, there would be sarcastic bloggers like Hmmmm who would criticize them for not taking action.
... written by Northsidian , March 19, 2010 - 07:26 pm
Huh, are you a lawyer?
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