Grabler Manufacturing Co. v. Kosydar

Two questions are presented in this case: (1) Are the monies paid by Grabler as deficiencies pursuant to the lease agreement excepted from sales and use taxes? (2) What was the effective date of the repeal of the use-on-use exception?

Grabler paid to Commercial $8,314,711 in deficiency payments for two sales of equipment pursuant to their lease agreement. Appellant contends that these monies were paid as liquidated damages for breach of the lease contract and as such are not subject to Ohio sales or use tax.

The lease contained two alternate provisions for premature termination, Section 4 and…