U. S. Industrial Alcohol Company v. State of Illinois

The claimant, The U. S. 1ndustria.l Alcohol Company, a West Virginia corporation, duly licensed a.s an importing distributor under the Liquor Control Act, has been engaged since ’ 1934 in the manufactu.re, transportation, importation and sale of non-bevera.ge alcohol to non-beverage users. On or about June 27,1938, the claimant paid to the Department of Finance , of the State of Illinois, a ta.x in the sum of $6,752.74, involuntarily, and under protest a.na notice of same. .

On the same day the Department of Finance in compliance with Section (2A) of an Act approved June 9, 1911, entitled: “An Act in Relation to the Payment and Disposition of Monies Received for or on beha.lf of the State,” notified t’he State Treasurer that the sum of !$6,752.74,was paid by this claimtint under protest. The State Treasurer placed [*327] said sum of money in the special fund known as the "protest fund."

On July 21, 1938 claimant filed its complaint in chancery in the Circuit Court of Sangamon County against S. L. Nudelman, the then acting Director of Finance of the State of Illinois, and John C. Martin the then acting State Treasurer of the State of Illinois, and others, praying for a temporary injunction restraining the said Nudelman, as Director of Finance and the said Martin, as State Treasurer from transferring the said sum of $6,752.74 from the "protest fund" in the State Treasurer's office to the appropriate fund or funds to which it would have been placed if the same had not been paid under protest and further prayed that said injunction be made permanent upon a hearing of said cause and that the said Nudelman and Martin be required to account to the claimant for the said sum of money and be required to return or pay over to claimant said sum so paid as aforesaid:

On July 25, 1938 the Circuit Court of Sangamon County, entered an order that the Writ of Temporary Injunction be issued against the defendants, Nudelman and Martin as in said complaint prayed.

On June 3, 1940, the said Circuit Court of Sangamon County entered a final decree in said cause making the temporary injunction permanent, a part of said decree being in words and figures as follows:

"The alcohol sold by the plaintiff for which the Department of Finance claimed that a tax was due, and which tax was paid by the plaintiff was what is known as absolute alcohol, 190 proof or 95% alcohol, and 188 proof or 94% alcohol, and was incapable of being used for beverage purposes. Said alcohol was sold by the plaintiff to non-beverage users purely for industrial or mechanical purposes, and therefore was not within the provisions of the Liquor Control Act, as originally enacted, and is not now subject to the imposition of a tax on the sale thereof, as claimed by the Department of Finance of the State of Illinois. . . ."

"The defendants, Nudelman, as Director of Finance for the State of Illinois and Louie E. Lewis as State Treasurer of the State of Illinois do account to and pay over to the plaintiff forthwith the said sum of $6,752.74, so received by the Department of Finance from the plaintiff and deposited with the State Treasurer in the special 'protest fund.'" On June 6, 1940 the defendants S. L. Nudelman as Director of Finance, and Louie E. Lewis, as State Treasurer of the State of Illinois (who by appropriate amendment had been substituted as a party defendant) appealed from the decree of [*328] the Circuit Court of Sangamon County to the Supareme Court of Illinois.

On December 16, 1940, the Supreme Court filed its opinion in said cause, (said opinion being reported in Volume 375 of the Illinois Supreme Court Reports at page 342 thereof) affirming said decree. The Supreme Court in this opinion construed Section (1) of Article (8) of the Liquor Control Act as follows: “The intention of the legislature, apparent in the language of the Act t and from surrounding circumstances, precludes from application of the tax any transactions concerning alcohol incapable of use as a beverage. The expressed objects of the enactment are the fostering of temperance in the consumption of alcoholic liquors, and the protection of the health, safety and welfare of the people. Although alcohol, not expressly restricted in meaning, is included in its definition, alcoholic liquor is clearly limited to beverages. The specific exceptions from the entire act, as well as from the tax, are non-beverages, and a license is required only of those handling alcoholic liquor for purposes of consumption. While alcohol is not in its definition limited to beverage use, yet if admittedly not potable, and to be used solely for industrial or mechanical purposes, it is not within the expressed objects, of the Act . . . the alcohol sold by plaintiff being incapable of any beverage use was not subject to taxation under Section (I) of Article (8) of the Act as it obtained prior to July 1, 1934. . . . The deixee of the Circuit Court of S,angamon County is affirmed.”

On February 24, 1942, the claimant served a written demand for the return of $6,752.74, on George B. McKibbin, Director of Finance of the State of Illinois and Warren Wright, Treasurer of the State of Illinois, reciting the terms of the decree of the Circuit Court of Sangamon County as affirmed by the Supreme Court of Illinois, a copy of said demand being made a part of this record, but the said George B. McKibbin, and Warren Wright were unable to, and are still unable, to comply with said demand. On August 17, 1942 the said Warren Wright filed a statement in this court in which he reported: “According to the records of this office the Director of the Department ‘ of Finance did, on July 20, 1938, deposit with the State Treasurer the sum of $6,752.74, said sum to be held in the Protested Pees Fund for the account of The U. S. Industrial Alcohol Company. Further the records of this office show that on August 31, 1938, this sum was transferred to the General Revenue Fund.”

It is to be seen from the above report of Treasurer Wright that the said Nudelman and the said Martin, in utter disregard and in violation of the terms of said Writ of Injunction issued out of the Circuit Court of Sangamon County [*329] restraining said Nudelman and Martin from transferring said sum of money out of the “protest fund,’’ did within a few days after the issuance of said writ transfer said sum of I money from the “protest fund’’ to the General Revenue Fund without proper authority and in violation of the legal rights of this claimant. For this reason the said l\ilcI<ibbin and Wright were unable to refund to claimant the sum of money demanded. This unlawful action on the part of the aforesaid Nudelman and Martin has compelled the claimant to file its claim in this court.

Where money is paid under protest, and proceedings are instituted in a court of general jurisdiction to restrain officers of the State from paying the same into the State treasury, upon which injunction so restraining payment is issued, an award for refund will be made where said State officer, having notice of such injunction pays the amount into the State treasury.

Southern Izruft Corp. vs. State, 9 C. C. R. 306.

This claimant not only seeks an award for the tax paid to said Department of Finance, but seeks a further award at the legal rate of interest on said sum of money from the 3rd day of June 1940, to the date of this award.

The State is not liable for the payment of costs or interest in the absence of a statute subjecting it to such liability and in this State there is no such statute. 80tither~aK r a f t Corp. vs. State, Supra.

Phzllippps Petroleunz Corp. vs. State, 10 C. C. R. 319.

Phzllipps Petroleum Co. vs. Btate, 8 C. C. R. 198.

This court regrets its inability to award interest to the claimant.

An award is therefore entered in favor of claimant, The U. S. Industrial Alcohol Company, a Corporation, in the sum of $6,752.74. - (Nos. 3442, 3454, 3648, 3654 and 3655- Consolidated; No. 3 4 4 2 4 l a i m a n t awarded $24.00; No. 3454- Claimant awarded $28.67; No. 3648- Claimant awarded $44.48; No. 3654- Claimant awarded $24.00; No. 3655- Claimant ~ awarded $7.57.)

WESTERN UNION TELEGRAPH Co., A CORPORATION, Claimant, vus. STATE

OF ILLINOIS, Respondent. /

Opinion $le& November 10, 1942.

Claimant, proese.

[*330] 330 - George F. Barrett, Attorney General; Robert V. Ostrom, Assistant Attorney General, for respondent.

Services-lapse of appropriation out of which would be paid-before presentment of bill therefor-sufficient balance on appropriation to cover. Where it clearly appears that claimant furnished services at the request of the duly authorized officersof the State, and that bill therefor in correct amount was not presented before lapse of appropriation out of which it could be paid, an award may be made for amount due, where there is sufficient unexpended balance in said appropriation to pay same.

Same-same-same-interest on amount due- State not liable for payment of. The State is not liable for the payment of interest, in the absence of a statute subjecting it to such liability and in this State there is no such statute.

Chief Justice Damron delivered the opinion of the court:

Claimant has filed five complaints which are consolidated by agreement,of the parties.

Claim No. 3442 seeks an award in the sum of $24.00 for furnishing time services at the request of the House of Representatives at Springfield on January 1, 1938, to December 31, 1938, as per attached statement; claim No. 3454 seeks an award in the sum of $28.67 for telegraph services rendered by claimant on July 15, 1938, at the request of James P. Boyle who was chairman of the appropriations committee at that time; claim No. 3648 seeks an award in the sum of $44.48 for telegraph services Tendered by claimant for a series of telegrams signed by the then Speaker of the House, the Hon. Hugh W. Cross, notifying the members of the House of Representatives to attend the funeral of the late Governor Horner. These telegrams were sent from Chicago; claim No. 3654 seeks an award in the sum of $24.00 for time services furnished the offices of the Speaker of the House of Representatives and was contracted for by the late David Shanahan; and claim No. 3655 seeks an award in the sum of $7.57 for telegraph services furnished by claimant as authorized by the House of Representatives through the month of May and June, 1940, and July, 1941.

Claimant in addition to seeking an award for the actual services rendered by them to the various departments of the respondent also seek interest thereon at the legal rate from the date of the services to the rendition of this opinion.

It is evident from the verified complaints, the acknowledgements by letters from the various officers of the [*331] respondent and the lack of defense on the part of the Attorney General that the services were actually rendered as per invoices attached to each complaint thereof. And it is further evident from the record that had claimant billed the various departments of respondent in apt t'ime they would have been paid in due course for the reason there existed appropriations sufficient to pay each claim at the time the services were rendered.

Where it clearly appears that claimant rendered services to the State at the request of its duly authorized officers and for which an appropriation existed out of which payment could be made therefor, an award may be made for compensation for such services, in an amount not in excess of that agreed upon, where such appropriation lapsed before payment was made for same, on claim filed within a reasonable time.

Rzefler, et al., vs. Xtate, 11 C. C. R., 381.

The State is not liable for payment of costs or interest in the absence of a statute subjecting it to such liability and in this State there is no such statute.

Southern Kraft Corp. vs. Htate, 9 C. C. R., 306.

Phillips Petroleum Corp. vs. Btate, 10 C. C. R., 319.

U. 8. Industrial Alcohol Co. vs. Btate, Opinion No. 3736, Opinion rendered Nov. 10, 1942.

From the record the court enters the following awards in favor of claimant, viz. No. 3442, $24.00; No. 3454, $28.67; No. 3648, $44.48; No. 3654, $24.00; and No. 3655, $7.57, making a total due claimant on the five above complaints in the sum of $128.72.