Jerman Cookie Company v. Susan Combs, Comptroller of Public Accounts of the State of Texas And Greg Abbott, Attorney General of the State of Texas

Opinion

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03-08-00562-CV

Jerman Cookie Company, Appellant

v.

Susan Combs, Comptroller of Public Accounts of the State of Texas, and Greg Abbott, Attorney General of the State of Texas, Appellees

FROM THE DISTRICT COURT OF TRAVIS COUNTY, 126TH JUDICIAL DISTRICT NO. D-1-GN-01-001492, HONORABLE GUS J. STRAUSS, JR., JUDGE PRESIDING

CONCURRING OPINION

I concur in the majority’s judgment reversing and remanding this case to the district

court for further proceedings. I write separately because I disagree with the majority’s analysis of

the Comptroller’s rule and the district court’s interpretation and application thereof.

This case turns on the interpretation and application of the Comptroller’s former rule,

34 Tex. Admin. Code § 3.293(a)(9). The basic dispute is whether cookies sold by a retailer in

quantities of five or less are subject to sales tax. As the majority acknowledges, the Comptroller

conceded at oral argument that she interprets and applies her rule to mean that cookies sold in

quantities of five or less are “ready for immediate consumption” within the meaning of the

rule—and, therefore, subject to sales tax—only if they are sold by a retailer who provides eating

facilities, but that cookies sold in quantities of five or less are not “ready for immediate

consumption” within the meaning of the former rule—and, therefore, are exempt from sales tax—if they are sold by a retailer who does not provide eating facilities. The Comptroller’s interpretation

and application of her rule is consistent with the plain language of the rule and therefore entitled to

deference.

The district court, however, refused to consider and apply the entire rule to the facts

of this case and, thus, improperly granted summary judgment in favor of the Comptroller. Because

the record reflects that the district court considered only one portion of the rule in isolation, and not

the entire rule, when it granted summary judgment in favor of the Comptroller, I disagree with the

majority’s conclusion that the language of the rule supports the district court’s interpretation.

__________________________________________

Jan P. Patterson, Justice

Before Justices Patterson, Pemberton and Waldrop

Filed: July 23, 2009