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BTLG Table of Contents > Sales and Use Tax Court Decisions > C > Chevron U.S.A. Inc. v. State Board of Equalization … (1997)

Sales And Use Tax Court Decisions

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Chevron U.S.A. Inc. v. State Board of Equalization … (1997)

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Completion of Manufacture and Sale by Second Retailer

A purchaser contracted with a company to manufacture and deliver an oil platform to an offshore location outside California. The original contractor began constructing the platform at a California site but did not complete construction due to a dispute with the purchaser. Nevertheless, the contractor's employees continued working under an interim agreement. A second contractor then finished building the platform at the same site and, delivered it to the offshore location by common carrier.

The Board assessed tax against the original contractor for its partial completion of the platform, reasoning that the purchaser had taken delivery of the partially completed platform upon termination of the original contract. The court held, however, that under the particular facts of this case, the change in contractors prior to the completion of the full contract did not constitute 'delivery' of the platform to the purchaser. Thus, the sale remained an exempt sale in interstate commerce. Chevron U.S.A. Inc. v. State Board of Equalization (1997) 53 Cal.App.4th 289.