ÿWPCK : %<UNB 04UBÄn­n­³w@`4 ´Ã 0cË 0Ò.b 0J 1mR 0c¿ 0T" 0^v 0hÔ 0r< 0|® 0†* 0° 1u@ Bµ AQÒ Æ# 0Dé 0@- 0Dm 0d± D/ BD D3aU6”U.ÊU>øB)6DC_ AM¢U*ïýäv~úvÓxX(ÈhH  Z ‹6Times New Roman Regular( ¤T$¡¡Ó  Ó<þ6X9`(*Courier 12pt10cpi«<þ6X9`(*Courier 12pt10cpiXXxþ6X@ÉJQX@«<þ6X9`(*Courier 12pt10cpiXXxþ6X@ÉJQX@ ?[@[AUBDCDDUEDFeGÓ€Qê‚_#3|xQ("*‡$Ô€X¼XXXÔòòÚ  Ú0Ú  Úóó(‚(2¢$¤¤Ý ƒ¤T!ÝÓ  ÓÝ  ÝÒ€°ÒÒÀ°ÒÔ€XµFXXXÔÔ€XµFXXXµFÔà Ø àòòÚ  Ú0Ú  Úóó- ù-2 ÿÿ0Indent1Ô2ÔÔ3  Ô#4e37=CIQYag­­1.a.i.(1)(a)(i)1)a)(;³¾$´´Ô24eÔÚ  Ú0Ú  Ú.Ô3  Ôà0  à2" ÿÿ0Indent2à0 àÔ2ÔÔ3  Ô2, ÿÿ0Indent3à0 àà0 àÔ2ÔÔ3  Ô26 ÿÿ0Indent4à0 àà0 àà0 àÔ2ÔÔ3  Ô2@ ÿÿ0Indent5à0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2J ÿÿ0Indent6à0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2T ÿÿ0Indent7à0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2^ ÿÿ0Indent8à0 àà0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô ÿÿ?AGMSYaioIndent0I.A.1.a.(1)(a)i)a) d!"#$&Cþÿ<< CÿÿƒLevel 1Level 2Level 3Level 4Level 5(3¯$¢¢Ý ƒ!ÝÝ  Ý("ÿÿ$££Ò  ÒÒ  Ò($$””ò òÚ  Ú1Ú  Úó óP ÿÿ8Mac DefaultMac DefaultÓ ` °šXÓ(('÷ÿ dxdüÿP Pd'ÿÿdxd< Œ 9p`(Courier New< Œ 9p`(Courier< Œ 9p`(&Times New Roman% Line 7 d22227Border 1dd!#3Cþÿ << Gÿÿ< Œ 9p`(Arial óÝ ƒ!ÝÔ€/ÔÝ  ÝÝ ƒ""ÝÝ  ÝÔ€5ÔÔ€5ÔÓ  Óò òÔ YYY ÔFILEDÔ€5XÔÌÌNovember€17,€1997ÌÌCecil€W.€CrowsonÌAppellate€Court€ClerkÔ  Ôó ó ÚÝ ƒ!ÝÑ#€d#ÑÔ€/ÔÝ  ÝÝ ƒ $ÝÒ € ÒÒ À ÒÔ€1ÔÔ€1XÔà àòòÚ  ÚÚ  ÚóóÝ  ÝBecause€we€conclude€that€the€plaintiff€is€not€entitled€to€any€credit€under€Tenn.€CodeÏAnn.€ðð€67„6„510,€we€do€not€address€the€difference€of€opinion€between€the€trial€court€and€theÏCourt€of€Appeals€regarding€the€calculation€of€the€amount€of€a€trade„in€credit.€€ÌPtPtHHÚ(ÿáÿâùFG(üHHØ(d'`Styl{WP}01•ÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃà Ãà Ãà Ãà Ãà ÃÃÃÃÃÃÃÃÃÃÃÐ ÐÐHHÐÐ  ÐÐ2ÐÐÿÿ¸æ$ÿÐÐHHÐÐÐÐÐÐÐÐ  ÐÐ ÐÐ ÐÑÑÑGenevaÑÑ ÑÑ € ÑÑ<Px–ÈÑÒÒÒ443!#4ÒÒ$ *$ÒÒ$*$ÒÒ ÿKK ÒÒ  Geneva ÒÒ  Geneva ÒÓ.,ÓÓÓÓ6ÓÓ ÓßßßßßßßßßßßßßßßßßßÑGenevaÑÑ ÑÒ  ion-F Geneva ÒÒ  ion-F Geneva ÒÝ ƒ!ÝÔ . ÔÔ€/ÔÝ  ÝÒ ° ÒÒ À ÒÑ , ÑÒ € ÒÒ À ÒÑ\R AØ'\ÑÑ  Ñòòò òØ ØÓ&€°d&ÓÓ&€00X°d&ÓÓ  ÓÑ\R AØ'\ÑÔ€1ÔÔ€1¼Ô›Þ ÞÌà@ àóóó óIN€THE€SUPREME€COURT€OF€TENNESSEEò òòòÌà@ àóóó óAT€NASHVILLEò òòòÌÌÓ ` °‡X»Q€%ŽX Óó óóóÌDAVID€HUTTON,à àà àà àœ)òò€ò òFOR€PUBLICATIONóóó ó›Ìà àà àà àà àà àà à)€œFILED:€November€17,€1997›Ìà àPlaintiff/Appellee,à àà àà à)à àà àà àà àà àà àà àà à)à àœHon.€James€L.€Weatherford,€Judge›à àà àà àà àà àà àà àœ)›Ìv.à àà àà àà àà àà à)€€œGiles€County›Ìà àà àà àà àà àà àœ)›ÌRUTH€E.€JOHNSON,à àà àà à)ÌCommissioner€of€Revenueà àà àœ)€NO.€€01S01„9705„CH„00101›ÌœÙ€!ÙßR€463A1-j|¢` ç `€€@ÿRß›for€the€State€of€Tennessee,à àà à)à àà àà àà àà àà àà àà à)Ìà àDefendant/Appellant.à àà à)ÌÌÌÌòòÓ&` ܆X»Q}€%ŽX&ÓFOR€APPELLANTà àà àà àà àà àFOR€APPELLEEÌÌóóJohn€Knox€Walkupà àà àà àà àà àChristopher€M.€WasÌAttorney€General€&€Reporterà àà àà àà àTrabue,€Sturdivant€&€DeWittÌà àà àà àà àà àà àà àà àNashville,€TennesseeÌMichael€E.€Moore€ÌSolicitor€GeneralÌÌMichael€W.€CatalanoÌAssociate€Solicitor€GeneralÌNashville,€TennesseeÌÌà@ àÌÌÌÌÌÌà@ àO€P€I€N€I€O€N€€€€€€€€ÌÌÌÌÌÌœJudgment›€of€Trial€Courtà€ àÌand€Court€of€Appeals€œReversedÌÓ&` ܆X»Q€%ŽX&ÓCause€Remanded.à àà àà àà àà àà àDrowota,€J.à àà àà àà àà àà àà àà àÌÑ€ÑÌ›Ñ ° ÑÓÓÑ7€w-XXdÈXXdÈ7Ñà àà àWe€granted€the€application€for€permission€to€appeal€filed€by€theÏdefendant,€Department€of€Revenue,€regarding€the€issue€whether€the€Court€ofÏAppeals€erred€in€upholding€the€trial€courtððs€determination€that€the€plaintiff,Ïin€computing€the€use€tax€on€a€jet€aircraft€acquired€by€him€in€December€ofÏ1993,€was€entitled€to€a€credit€under€Tenn.€Code€Ann.€ðð€67„6„510.€€WeÏdenied€the€application€for€permission€to€appeal€filed€by€the€plaintiff,€DavidÏHutton.€€ÌÌà àà àWe€conclude€that€the€transaction€whereby€Mr.€Hutton€acquiredÏthe€jet€airplane€upon€which€the€Department€of€Revenue€imposed€use€taxesÏdid€not€constitute€a€trade€nor€was€such€transaction€part€of€a€series€of€trades.€ÏTherefore,€Mr.€Hutton€is€not€entitled€to€a€credit€under€Tenn.€Code€Ann.€ððÏ67„6„510€in€computing€the€use€tax€on€the€jet€aircraft.€€Given€our€dispositionÏof€this€issue,€we€do€not€address€the€other€issues€presented€in€the€DepartmentÏof€Revenueððs€application.€€The€judgment€of€the€Court€of€Appeals€and€that€ofÍthe€trial€court€are€reversed,€and€the€plaintiffððs€suit€for€a€refund€of€use€taxesÏis€dismissed.ÌÌà@ àòòBACKGROUNDóóÌÌà àà àDavid€Hutton,€who€is€a€resident€of€Pulaski,€Tennessee,€isÏengaged€in€the€real€estate€development€business.€€He€owns,€directly€orÏindirectly,€several€shopping€centers€in€the€southeastern€part€of€the€UnitedÏStates.€€ÌÌà àà àPrior€to€June€of€1993,€Mr.€Hutton€owned€a€twin„engineÏpropeller„driven€airplane,€a€Beech€Model€F€90,€which€he€used€in€his€realÏestate€business.€€In€1993€he€decided€to€replace€this€propeller„driven€airplaneÏwith€a€jet€aircraft€that€would€better€serve€his€business€needs.€€He€wanted€toÏstructure€his€disposition€of€the€propeller„driven€plane€and€acquisition€of€a€jetÏaircraft€in€a€manner€that€would€enable€him€to€defer,€for€federal€income€taxÏpurposes,€the€gain€he€would€realize€upon€the€disposition€of€the€propeller„driven€plane.ÌÌà àà àBell€Aviation,€Inc.€is€an€aircraft€brokerage€firm€with€itsÏprincipal€place€of€business€in€Lexington,€South€Carolina.€€On€June€25,€1993,ÍBell€Aviation,€Inc.€entered€into€a€contract€with€David€Hutton€(the€ð ðExchangeÏAgreementðð)€pursuant€to€which€Mr.€Hutton€sold€his€Beech€Model€F€90€toÏBell€Aviation,€Inc.€for€a€price€of€$1,142,000.€€ÌÌà àà àThe€Exchange€Agreement€was€drafted€in€a€manner€intended€toÏpermit€David€Hutton€to€defer,€pursuant€to€Section€1031€of€the€InternalÏRevenue€Code,€the€recognition€of€the€gain€that€he€realized€upon€selling€theÏpropeller„driven€plane€to€Bell€Aviation,€Inc.€€Accordingly,€under€theÏExchange€Agreement€Mr.€Hutton€was€given€45€days€from€June€25,€1993€toÏidentify€ð ðlike€kindðð€property€that€he€could€acquire€ð ðin€exchangeðð€for€theÏpropeller„driven€plane.€€Mr.€Hutton€had€under€the€Exchange€Agreement€180Ïdays€from€June€25,€1993€in€which€to€acquire€title€to€any€such€ð ðlike€kindððÏproperty€that€he€identified.ÌÌà àà àUnder€the€terms€of€the€Exchange€Agreement,€Bell€Aviation,ÏInc.€was€required€to€use€its€best€efforts€to€facilitate€Mr.€Huttonððs€desire€toÏhave€the€transaction€qualify€as€an€exchange€of€ð ðlike€kindðð€property€underÏSection€1031€of€the€Internal€Revenue€Code.€€In€this€regard,€Bell€Aviation,ÏInc.€was€called€upon€to€execute€certain€documents€in€the€event€Mr.€HuttonÏwas€successful€in€identifying€ð ðlike€kindðð€property.€However,€Bell€Aviation,ÍInc.ððs€undertaking€was€limited€by€the€following€provision€of€the€ExchangeÏAgreement:ÌÌÓÓÓ/%` ܃XÒÀ»Q}€%ŽX/Óà8 àà8 àà àNotwithstanding€anything€herein€contained€toÏthe€contrary:€€ÌÌà8 àà8 àà àA.€€Bell€shall€not€be€in€default€under€thisÏExchange€Agreement€and€shall€not€be€liable€forÏany€damages,€losses,€or€expenses€incurred€byÏowner€(David€Hutton),€if:€€(i)€Bell€fails€to€take€anyÏsteps€to€locate,€negotiate€for€or€acquire€theÏExchange€Property,€or€(ii)€any€Exchange€PropertyÏfails€to€qualify€as€ððlike€kindðð€property,€or€theÏtransaction€otherwise€fails,€for€any€reason,€toÏafford€Owner€some€or€all€of€the€benefits€of€ðð€1031Ïof€the€Internal€Revenue€Code,€unless€the€failure€isÏcaused€solely€by€the€gross€negligence€of€Bell€or€aÏnegligent€misrepresentation€(regarding€whetherÏBell€Aviation,€Inc.€was€a€ððdisqualified€personðð€asÏdefined€in€U.S.€Treasury€Regulation€ðð€1.1031(k)„1(k)).ððÌÌÌÌÓÓà àà àContemporaneous€with€the€execution€of€the€ExchangeÏAgreement€on€June€25,€1993,€David€Hutton€conveyed€title€to€the€BeachÏModel€F€90€to€Bell€Aviation,€Inc.€€Bell€Aviation,€Inc.€paid€the€$1,142,000Ïpurchase€price€by€paying€$512,913.48€to€satisfy€an€outstanding€lien€on€theÏpropeller„driven€plane€and€by€paying€the€balance,€$629,086.52,€to€an€escrowÏagent€(First€National€Bank€of€Pulaski).ÌÌà àà àThe€Exchange€Agreement€provided€that€if€Mr.€Hutton€had€notÏidentified€suitable€ð ðlike€kindðð€property€and€acquired€such€ð ðlike€kindððÏproperty€within€the€respective€45„day€and€180„day€time€limits,€he€wouldÏhave€been€entitled€to€the€$629,086.52€that€Bell€Aviation,€Inc.€had€paid€to€theÏescrow€agent,€plus€the€interest€thereon€accruing€after€June€25,€1993.€ÏOtherwise,€the€money€in€the€escrow€account€would€be€paid€on€DavidÏHuttonððs€behalf€as€partial€payment€of€ð ðlike€kindðð€property€that€he€acquired.ÏThus,€the€benefits€on€the€escrow€account€belonged€to€Mr.€Hutton€after€JuneÏ25,€1993.ÌÌà àà àNeither€Bell€Aviation,€Inc.ððs€acquisition€of€€title€to€the€BeachÏModel€F€90€on€June€25,€1993€nor€Mr.€Huttonððs€benefiting€from€the€fullÏprice€paid€€therefor,€$1,142,000.00,€was€subject€to€any€condition€regardingÏMr.€Huttonððs€success€in€finding€and€acquiring€suitable€ð ðlike€kindðð€property.€€ÌÌà àà àOn€August€6,€1993,€Mr.€Hutton€sent€to€Bell€Aviation,€Inc.€aÏletter€stating€that€he€ð ðidentifies€property€described€as,€Cessna€Citation€II,€asÏExchange€Property€under€the€(Exchange)€Agreement.ðð€€ÌÌà àà àDavid€Hutton€entered€into€a€contract€dated€December€16,€1993Ïwith€Cessna€Aircraft€Company€of€Wichita,€Kansas€entitled€ð ðUsed€AircraftÍPurchase€Agreementðð€(the€ð ðCessna€Agreementðð).€€The€Cessna€AgreementÏcalled€for€Mr.€Hutton€to€purchase€from€Cessna€Aircraft€Company€a€1985ÏCessna€Citation€S/II€jet€aircraft.€€The€price€for€the€jet€aircraft€wasÏ$2,250,000.00,€with€$112,500€being€paid€upon€execution€of€the€CessnaÏAgreement€and€the€balance,€$2,137,500.00,€being€due€upon€delivery€of€theÏjet.€€The€Cessna€Agreement€included€the€following€provision:ÌÌÓÓà8 àà8 àð ðSelling€Priceà àà àà àà à$2,250,000Ìà àà à€€Less€Trade€Allowanceà àà àà à€€€€€€€€€€€€€€€€0Ìà àà à€€Net€Priceà àà àà à€€€€€€€€$€2,250,000Ìà àà à€€Deliver€Priceà àà àà à€€€€€€$2,250,000"ÌÌÌÓÓà àà àThe€Cessna€Agreement€contained€no€reference€to€the€transactionÏwhereby€Mr.€Hutton€had€sold€the€propeller„driven€aircraft€to€Bell€Aviation,ÏInc.€€It€did€include€€the€following€provision:ÌÌÓÓà8 àà8 àà àð ðThis€Agreement€is€the€only€agreementÏà àà àà àà àà àcontrolling€thisÏpurchase€and€sale,€express€or€implied,€either€verbalÏor€in€writing,€and€is€binding€on€Purchaser€andÏSeller,€their€heirs,€executors,€administrators,Ïsuccessors€or€assigns.€€This€Agreement,€includingÏthe€rights€of€Puchaser€hereunder,€may€not€beÏassigned€by€Purchaser€except€to€a€wholly„ownedÏsubsidiary€or€successors€in€interest€by€name€changeÏor€otherwise€and€then€only€upon€the€prior€writtenÏconsent€of€Seller.€€Purchaser€acknowledges€receiptÏof€a€written€copy€of€this€Agreement€which€may€notÍbe€modified€in€any€way€except€by€writtenÏagreement€executed€by€both€parties.ððÌÌÌÌÓÓà àà àOn€December€17,€1993,€David€Hutton€executed€a€documentÏpursuant€to€which€he€purported€to€assign€his€rights€under€the€CessnaÏAgreement€to€Bell€Aviation,€Inc.€€Such€an€assignment€had€been€contemplatedÏby€the€terms€of€the€Exchange€Agreement€between€Mr.€Hutton€and€BellÏAviation,€Inc.€€On€the€same€day€Bell€Aviation,€Inc.€executed€a€letter€thatÏpurported€to€direct€Cessna€Aircraft€Company€to€deliver€title€to€the€jetÏaircraft€directly€to€Mr.€Hutton.€€It€is€not€clear€from€the€record€whether€thisÏletter€and€Mr.€Huttonððs€assignment€were€actually€sent€to€Cessna€AircraftÏCompany.ÌÌà àà àBell€Aviation,€Inc.€also€signed€a€letter€dated€December€17,€1993Ïin€which€it€directed€the€escrow€agent€under€the€Exchange€Agreement,€FirstÏNational€Bank€of€Pulaski,€to€pay€the€money€it€had€been€holding€in€theÏescrow€account€to€Cessna€Aircraft€Company€as€partial€payment€for€Mr.ÏHuttonððs€purchase€of€the€jet€aircraft.ÌÌà àà àMr.€Hutton€states€in€his€affidavit€that,€ð ðThe€transaction€forÏacquisition€of€the€Cessna€aircraft€was€closed€on€December€20,€1993.€€AfterÍcertain€modifications,€maintenance€and€pilot€training€were€completed,€theÏaircraft€was€delivered€to€me€on€or€about€January€20,€1994.ððÌÌà àà àThe€Department€of€Revenue€sent€David€Hutton€a€letter€datedÏSeptember€2,€1994€by€which€it€assessed€use€taxes€on€the€jet€aircraft€Mr.ÏHutton€had€purchased€from€Cessna€Aircraft€Company.€€(Sales€taxes€were€notÏimposed€because€the€transaction€between€Mr.€Hutton€and€Cessna€AircraftÏCompany€did€not€occur€in€the€State€of€Tennessee.)€€The€amount€of€theÏSeptember€2,€1994€use€tax€assessment€was€based€on€the€full€purchase€priceÏof€the€jet€aircraft,€$2,250,000.€€Ìà àà àMr.€Hutton€paid€the€portion€of€the€use€tax€assessment€that€he€didÏnot€contest,€which€was€the€portion€thereof€based€on€the€excess€of€the€price€ofÏthe€jet€aircraft€($2,250,000)€over€the€price€for€which€he€had€sold€theÏpropeller„driven€plane€($1,142,000).€€Following€an€informal€conferenceÏbetween€Mr.€Hutton€and€the€Department€of€Revenue,€the€Department€sentÏMr.€Huttonððs€attorney€a€letter€dated€December€19,€1994€that€included€theÏfollowing:ÌÌÓÓà8 àà8 àà àð ðThe€totality€of€the€circumstances€mandateÏ(sic)€a€finding€that€a€trade„in€credit€is€unavailable.€ÏThe€facts€indicate€that€no€trade„in€occurred,€butÏrather€two€separate€transactions€took€place.€€TheÍDepartment€must€therefore€uphold€the€tax€andÏinterest€portions€of€the€assessment.ððÌÌÌÌÓÓà àà àIn€response€to€the€foregoing€letter,€Mr.€Hutton,€on€DecemberÏ30,€1994,€paid€the€balance€of€the€assessment.€€ÌÌà àà àThe€Department€of€Revenue€sent€Mr.€Hutton€a€letter€datedÏDecember€7,€1995€in€which€the€Department€of€Revenue,€pursuant€to€Tenn.ÏCode€Ann.€ðð€67„1„1802(c)(2),€waived€the€requirement€for€filing€anÏadministrative€claim€for€a€refund€and€informed€Mr.€Hutton€that€he€had€sixÏmonths€in€which€to€file€a€suit€for€a€refund€in€chancery€court.€ÌÌà àà àMr.€Hutton€filed€his€complaint€in€the€Chancery€Court€for€GilesÏCounty€on€April€25,€1995.€€He€sought€a€refund€of€a€portion€of€the€use€taxesÏhe€had€paid€based€on€his€contention€that,€in€computing€the€use€taxes€on€theÏjet€aircraft€he€had€acquired€from€Cessna€Aircraft€Company,€he€was€entitledÏto€a€credit€under€Tenn.€Code€Ann.€ðð€67„6„510€for€the€propeller„drivenÏplane€he€had€sold€to€Bell€Aviation,€Inc.€€ÌÌà àà àBoth€parties€moved€for€summary€judgment.€€The€trial€courtÏgranted€the€summary€judgment€motion€of€Mr.€Hutton€and€denied€that€of€theÍDepartment€of€Revenue.€€The€trial€court€ruled€that€Mr.€Hutton€was€entitledÏto€a€refund€based€on€a€$1,142,000€trade„in€value€for€the€propeller„drivenÏplane.ÌÌà àà àThe€Department€of€Revenue€appealed€the€trial€courtððs€decisionÏto€the€Court€of€Appeals.€€The€Court€of€Appeals€agreed€with€the€trial€courtÏthat€Mr.€Hutton€was€entitled€to€a€credit€under€Tenn.€Code€Ann.€ðð€67„6„510.€ÏHowever,€the€Court€of€Appeals€held€that€the€credit€should€have€been€limitedÏto€an€amount€based€on€the€amount€€deposited€by€Bell€Aviation,€Inc.€in€theÏescrow€account,€rather€than€an€amount€based€on€the€full€$1,142,000€value€ofÏthe€propeller„driven€plane.× ƒ7 ××  ×€€ÌÑ X ÑÌà àà àJudge€Koch€filed€a€dissenting€opinion€in€which€he€concludedÏthat€no€credit€was€allowable€under€Tenn.€Code€Ann.€ðð€67„6„510€because€theÏacquisition€of€the€jet€aircraft,€ð ðdoes€not€involve€a€trade€or€series€of€trades.ðð€€ÌœÌ›Ìò òà@ àòòANALYSISóóó óÌœ›à àà àThe€Department€of€Revenueððs€assessment€of€use€taxes€withÏrespect€to€the€jet€aircraft€David€Hutton€acquired€for€Cessna€AircraftÍCompany€was€made€pursuant€to€Tenn.€Code€Ann.€ðð€67„6„203(a).€€ThisÏstatute€provides€as€follows:ÌÌÓÓà8 àà8 àà à(a)€A€tax€is€levied€at€the€rate€of€six€percentÏ(6%)€of€the€cost€price€of€each€item€or€article€ofÏtangible€personal€property€when€the€same€is€notÏsold€but€is€used,€consumed,€distributed,€or€storedÏfor€use€or€consumption€in€this€state;€provided,€thatÏthere€shall€be€no€duplication€of€the€tax.ððÌÌÌÌÓÓà àà àMr.€Hutton€maintains€that€he€is€entitled€to€a€credit€against€theÏuse€tax€assessment€under€Tenn.€Code€Ann.€ðð€67„6„510.€€Subsection€(a)€ofÏthis€statute€provides€as€follows:ÌÌÓÓà8 àà8 àà àð ð(a)€Where€used€articles€are€taken€in€trade,€orÏin€a€series€of€trades,€as€a€credit€or€part€payment€onÏthe€sale€of€new€or€used€articles,€the€tax€levied€byÏthis€chapter€shall€be€paid€on€the€net€difference,€thatÏis,€the€price€of€the€new€or€used€ariticle€sold€less€theÏcredit€for€the€used€article€taken€in€trade.ððÌÌÌÓÓà àà àTenn.€Code€Ann.€ðð€67„6„510€operates€to€negate€(in€part)€otherÏprovisions€of€the€Retailersðð€Sales€Tax€Act€that€would€otherwise€impose€salesÏor€use€taxes.€€Therefore,€the€rules€of€statutory€construction€that€apply€toÏexemptions€(which€are€listed€in€Tenn.€Code€Ann.€ðððð€67„6„301€through€67„6„352)€apply€to€the€contruction€and€application€of€Tenn.€Code€Ann.€ðð€67„6„510.€€òòSeeóó,€òòe.g.óó,€òòTibbals€Flooring€Company€v.€Huddlestonóó,€891€S.W.2d€196,Í198€(Tenn.€1994);€òòCovington€Pike€Toyota,€Inc.€v.€Cardwellóó,€829€S.W.2dÏ132,€135€(Tenn.€1992);€òòRogers€Group,€Inc.€v.€Huddlestonóó,€900€S.W.2d€34,Ï36€(Tenn.€App.€1995).€€These€rules€of€statutory€construction€were€describedÏby€the€Court€of€Appeals€in€òòAmerican€Cyanamid€Company€v.€Huddlestonóó,Ï908€S.W.2d€396€(Tenn.€App.€1995),€as€follows:ÌÌÓÓà8 àà8 àà àð ðTax€exemption€statutes€are€to€be€construedÏagainst€the€taxpayer€and€will€not€be€implied.€.€.€.€€ÌÌà8 àà8 àà àEvery€presumption€is€against€exemption,€andÏany€well€founded€doubt€defeats€a€claimedÏexemption.€.€.€.€€ÌÌà8 àà8 àà àThe€burden€is€upon€the€taxpayer€to€establish€aÏclaimed€exemption.€.€.€.ðð€€(Citations€omitted)ÌÌ908€S.W.2d€at€400.ÌÌÌÓÓà àà àThe€documents€pursuant€to€which€Mr.€Hutton€sold€the€BeachÏModel€F€90€to€Bell€Aviation,€Inc.€and€purchased€a€jet€aircraft€from€CessnaÏAircraft€Company€establish€that€these€were€two€independent€transactions.€ÏNeither€of€these€transactions€was€dependent€upon€the€completion€of€theÏother.€€Even€if€we€apply€the€ð ðstep€transaction€doctrineðð€(as€is€urged€by€theÏplaintiff€and€as€was€done€by€the€majority€of€the€Court€of€Appeals),€we€doÏnot€reach€a€different€conclusion.ÌÌà àà àThe€ð ðstep€transaction€doctrineðð€is€a€doctrine€that€federal€courtsÏhave€adopted€in€dealing€with€cases€that€are€governed€by€the€Internal€RevenueÏCode.€€The€U.S.€Court€of€Appeals€for€the€Second€Circuit€described€thisÏdoctrine€and€the€Ñ ° Ñtwo€tests€that€are€employed€thereunder€as€follows€in€òòGreeneÏv.€United€Statesóó,€13€F.2d€577€(2nd€Cir.€1994):€ÌÌÓÓà8 àà8 àà àð ðThe€(step€transaction)€doctrine€treats€theÏððstepsðð€in€a€series€of€formally€separate€but€relatedÏtransactions€involving€the€transfer€of€property€as€aÏsingle€transaction,€if€all€the€steps€are€substantiallyÏlinked.€.€.€.€€Rather€than€viewing€each€step€as€anÏisolated€incident,€the€steps€are€viewed€together€asÏcomponents€of€an€overall€plan.€.€.€.€€Of€course,€theÏdoctrine€cannot€manufacture€facts€that€neverÏoccurred€.€.€.ÌÌà8 àà8 àà àUnder€the€end€result€test,€the€step€transactionÏdoctrine€will€be€invoked€if€it€appears€that€a€seriesÏof€separate€transactions€were€prearranged€parts€ofÏwhat€was€a€single€transaction,€cast€from€the€outsetÏto€achieve€the€ultimate€result.€.€.€.ÌÌà8 àà8 àà àThe€interdependence€test€is€a€variation€of€theÏend€result€test.€.€.€.€€It€focuses€on€whether€the€stepsÏare€ððso€interdependent€that€the€legal€relationsÏcreated€by€one€transaction€would€have€beenÏfruitless€without€a€completion€of€the€series.ðð.€.€.€€ToÏapply€this€test,€a€court€must€determine€whether€theÏindividual€steps€had€ððindependent€significance€orÏwhether€they€had€meaning€only€as€part€of€theÏlarger€transaction.ðððð€ÌÌ13€F.3d€577,€at€583„84.ÌÌÓÓà àà àThe€two€transactions€involved€in€this€case€each€had€independentÏsignificance.€€Neither€of€such€transactions€was€dependent€on€the€carrying€outÏof€the€other.€€After€June€25,€1993,€Bell€Aviation,€Inc.ððs€purchase€of€theÏpropeller„driven€plane€from€Mr.€Hutton€and€its€payment€of€the€purchaseÏprice€therefor€had€become€final;€even€though€the€Exchange€AgreementÏcontemplated€efforts€to€make€the€provisions€of€Section€1031€of€the€InternalÏRevenue€Code€available€to€Mr.€Hutton,€Bell€Aviation,€Inc.ððs€purchase€of€theÏpropeller„driven€plane€was€not€contingent€on€the€success€of€such€efforts.€ÏEven€if€we€assume€that€Mr.€Huttonððs€assignment€of€his€rights€under€theÏCessna€Agreement€and€Bell€Aviation,€Inc.ððs€December€17,€1993€letterÏdirecting€Cessna€Aircraft€Company€to€deliver€title€to€the€jet€airplane€to€Mr.ÏHutton€were€actually€delivered€to€Cessna€Aircraft€Company,€such€documentsÏdid€not€have€significance;€the€transaction€involving€the€jet€airplane€wasÏcarried€out€according€to€the€terms€of€the€Cessna€Agreement,€i.e.,€CessnaÏAircraft€Company€conveyed€title€to€the€jet€aircraft€to€Mr.€Hutton€inÏexchange€for€the€full€purchase€price€of€$2,250,000.€€ÌœÌ›Ìò òà@ àòòCONCLUSIONóóó óÌœ›à àà àWe€conclude€that€Mr.€Huttonððs€acquisition€of€the€jet€aircraft€didÏnot€involve€a€trade€nor€was€it€part€of€a€series€of€trades.€€Therefore,€inÍcomputing€the€use€taxes€on€the€jet€aircraft,€no€credit€is€available€under€Tenn.ÏCode€Ann.€ðð€67„6„510.€€The€judgment€of€the€Court€of€Appeals€and€theÏjudgment€of€the€trial€court€are€reversed.€€This€case€is€remanded€to€the€trialÏcourt€for€entry€of€summary€judgment€in€favor€of€the€Department€ofÏRevenue€and€the€awarding€of€reasonable€attorneyððs€fees€and€expenses€ofÏlitigation€pursuant€ot€Tenn.€Code€Ann.€ðð€67„1„1803(d).ÌÌÓÓà€ àòòÌà àà àà àà àà àà àà àà à€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€€ÏóóÌà àà àà àà àà àà à€€€€€€à àFrank€F.€Drowota,€œIII,›€€€€€€€€€€€€€€Ìà àà àà àà àà àà àà àà àJusticeÌÌò òConcur:ó óÌÌAnderson,€C.J.ÌReid,€Birch,€Holder,€J.J.€€€€€€€€€€€ÌÌÌÌÌà àÌÌ