State v. Dunhall Pharmaceuticals, Inc.

Supreme Court of Arkansas

State v. Dunhall Pharmaceuticals, Inc.

702 S.W.2d 402, 288 Ark. 16, 1986 Ark. LEXIS 1696

CourtSupreme Court of Arkansas

DecidedJanuary 13, 1986

Docket85-183

StatusPublished

Cited by1 cases

This text of 702 S.W.2d 402 (State v. Dunhall Pharmaceuticals, Inc.) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

State v. Dunhall Pharmaceuticals, Inc., 702 S.W.2d 402, 288 Ark. 16, 1986 Ark. LEXIS 1696 (Ark. 1986).

Pincite

Opinions

Robert H. Dudley, Justice.

The sole issue on appeal is whether the free distribution of samples of prescription products by the appellee, Dunhall Pharmaceuticals, Inc., is subject to a sales tax. The trial court held the distribution was not taxable. We affirm.

The Arkansas Gross Receipts Tax is applicable when there is a transfer of either title or possession for a valuable consideration. Ark. Stat. Ann. § 84-1902 (Repl. 1980). Obviously, when the samples were distributed there was a transfer of title and possession. The issue is whether the distribution was for a valuable consideration. The scant determinative facts before us are contained in the following stipulation:

Between November 1, 1979 and October 31, 1982, Appellee gave samples of prescription flouride products and gels without charge to a number of Arkansas dentists.

The State argues that there was a valuable consideration in the form of advertising. That argument asks us to reverse the trial court upon sheer speculation, and not upon the stipulated facts.

The stipulation does not show the method of distribution; it does not show whether the sample contained any printing, printed materials, or whether any representations were made about them. Thus, if the samples were mailed to the dentists, no advertising was shown. If they were delivered by representatives, no representative advertising was shown. The stipulation offers no clue about the reason for the distribution. It does not reveal how particular dentists were selected as distributees or how many of them received an unknown quantity of samples. The stipulation does not tell us whether the dentists even know the name of the manufacturer or distributor of the samples. A valuable consideration in the form of advertising is simply not shown by the fact stipulation.

The stipulation contains no evidence of consideration.

Affirmed.

Purtle, J., not participating. George Rose Smith, J., concurs.

Free access — add to your briefcase to read the full text and ask questions with AI

Robert H. Dudley, Justice.

The sole issue on appeal is whether the free distribution of samples of prescription products by the appellee, Dunhall Pharmaceuticals, Inc., is subject to a sales tax. The trial court held the distribution was not taxable. We affirm.

The Arkansas Gross Receipts Tax is applicable when there is a transfer of either title or possession for a valuable consideration. Ark. Stat. Ann. § 84-1902 (Repl. 1980). Obviously, when the samples were distributed there was a transfer of title and possession. The issue is whether the distribution was for a valuable consideration. The scant determinative facts before us are contained in the following stipulation:

Between November 1, 1979 and October 31, 1982, Appellee gave samples of prescription flouride products and gels without charge to a number of Arkansas dentists.

The State argues that there was a valuable consideration in the form of advertising. That argument asks us to reverse the trial court upon sheer speculation, and not upon the stipulated facts.

The stipulation does not show the method of distribution; it does not show whether the sample contained any printing, printed materials, or whether any representations were made about them. Thus, if the samples were mailed to the dentists, no advertising was shown. If they were delivered by representatives, no representative advertising was shown. The stipulation offers no clue about the reason for the distribution. It does not reveal how particular dentists were selected as distributees or how many of them received an unknown quantity of samples. The stipulation does not tell us whether the dentists even know the name of the manufacturer or distributor of the samples. A valuable consideration in the form of advertising is simply not shown by the fact stipulation.

The stipulation contains no evidence of consideration.

Affirmed.

Purtle, J., not participating. George Rose Smith, J., concurs.

Cite This Page — Counsel Stack

Bluebook (online)

702 S.W.2d 402, 288 Ark. 16, 1986 Ark. LEXIS 1696, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-v-dunhall-pharmaceuticals-inc-ark-1986.

Opinions

Related

Cite This Page — Counsel Stack