Sales Tax – Necessary Parties

This matter was before the court on the Commissioner’s motion to resume trial without giving notice of these proceedings to the customers of appellant. With respect to sales and use taxes, the Tax Court was concerned with a scenario in which it affirmed the Commissioner’s order, and appellant subsequently pursues customers for indemnity or contribution under the terms of its contracts. More specifically, if appellant’s customers are bound by its determination here, then its “disposition of the action may as a practical matter impair or impede” the customers’ “ability to protect that interest” in the subsequent litigation. Although the Tax Court concluded that appellant’s customers have an interest in the subject matter of this action, it concluded that its disposition of this matter in their absence would not, as a practical matter, impair or impede their ability to protect that interest in any further proceedings. The Tax Court therefore granted the Commissioner’s motion.

8228-R Dahmes Stainless, Inc. v. Comm’r of Revenue

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