Florida Export Tobacco Co. v. Department of Revenue (510 So. 2d 936, 1987)

ON MOTION FOR REHEARING

ZEHMER, Judge.

The Department of Revenue and the Comptroller, appellees, have moved for rehearing and rehearing en banc on several grounds. Many of the constitutional, statutory, and decisional authorities cited in the motion and in appellants’ response were not previously presented in the parties’ briefs of the issues on appeal. Failure to initially argue these pertinent authorities has compelled us to completely reexamine the issues and holding in our opinion.

The Tax Section of The Florida Bar has filed, as amicus curiae, a motion in support of appellees’ motion for rehearing en banc. We have considered the authorities and argument contained in that motion; however, we deny the Tax Section’s request to file a supporting brief.

After careful consideration of the motions for rehearing and the results of our own additional research, we are persuaded that the motion for rehearing should be granted in part. Accordingly, our original opinion is withdrawn and the following opinion is substituted therefor. The motion for rehearing en banc is denied.

I.

THE FACTS

Appellants, Florida Export Tobacco Co., Inc., Miami International Airport Pharmacy, Inc., Sirgany International, Inc., and International Pharmacies, Inc., are plaintiffs in this class action against the Department of Revenue (DOR) and the Comptroller (appellees). In this suit appellants have contested the legality of DOR’s assessment of certain taxes pursuant to section 212.-031, Florida Statutes (1979), and have sought a refund of the taxes paid by them and the members of the class pursuant to such assessments. They appeal a summary judgment for appellees granted on the sole ground that the Comptroller’s decision to deny a refund of the taxes in an administrative proceeding prosecuted by Florida Export pursuant to sections 215.26, 120.57, and 120.68, Florida Statutes (1979), is res judicata and bars this action in circuit court.

Appellants, concessionaires in the Miami International Airport terminal, leased property. for this purpose from Dade County under a written lease agreement made in July 1977. Pursuant to this lease, appellants paid an annual rental computed on a square footage basis and paid their sales taxes due on that amount. In addition, they paid the county a profit participation charge computed as the amount by which a fixed percentage of appellants’ gross revenues exceeded the rental payments. By letter to the lessor, Dade County, DOR demanded payment of the sales taxes on the profit participation charge in addition to the square footage charge, citing section 212.031 as authority, and appellants paid the taxes so demanded to the lessor for remittance to DOR.

On August 6,1979, Florida Export filed a class action in the Leon County circuit court on behalf of itself and all similarly situated taxpayers. The suit, naming DOR as the sole defendant, contested the legality of the tax assessments on the profit participation charge and demanded refund of all such taxes previously paid. DOR moved to dismiss the complaints on grounds that plaintiffs failed to exhaust available administrative remedies by not seeking a refund from the Comptroller under section 215.26. The court dismissed the complaint with leave to amend “with sufficient time allowed to satisfy the requirements of § 215.26, Fla.Stat., so that the members of the class ... will be limited to those who have paid the challenged tax, applied for a refund, and were denied such refund” (R. 37).

Each of the appellants then applied to the Comptroller for a refund on the ground that DOR’s tax assessment on the profit participation charge was illegal because such funds did not constitute lease or rental payments within the meaning of section 212.031. The refund application was referred to DOR, which reviewed its records and determined that the refund should not be paid. DOR so advised the Comptroller, and on July 24, 1980, the Comptroller notified appellants of his intent to deny the refund in accordance with DOR’s recommendation. This notice also advised appellants that they had a right, under section 120.57, Florida Statutes (1979), to request an administrative hearing regarding the Comptroller’s proposed decision and that, if no request were timely made, “this denial shall become final” (R. 111).

The record reflects considerable uncertainty on the part of appellants’ counsel regarding just how far to pursue the administrative proceeding with the Comptroller in order to satisfy the trial court’s order requiring that application for refund must be administratively denied before the circuit court action could proceed. In an apparent attempt to avoid waiver of administrative remedies and protect the rights of their clients, on August 6,1980, counsel for appellants wrote a letter to the Comptroller indicating they did not intend to request a section 120.57 hearing unless failure to do so would be construed as failure to exhaust administrative remedies and prevent continued prosecution of the pending circuit court actions. DOR refused to agree that appellants need not completely exhaust all administrative remedies by applying for such hearing. Appellants, “out of an abundance of caution,” requested an informal conference with the tax referee of DOR and filed a petition for a section 120.57 administrative hearing on behalf of themselves and “others in their class similarly situated” with the office of the Comptroller (R. 46). DOR was not made a party to that proceeding.

The Comptroller referred the petition to the Department of Administrative Hearings for assignment to a hearing officer. Prior to the section 120.57 hearing, all parties other than Florida Export took a voluntary dismissal and did not proceed to hearing. Counsel for petitioners stated on the record that, by proceeding to a section 120.-57 hearing on the denial of refund, petitioners did not intend to waive any rights they had to continue prosecution of their circuit court action. Counsel for petitioners, however, also stated on the record that the voluntary dismissal was taken with the understanding that the success obtained by Florida Export in the administrative proceeding would be “stare decisis” as to all appellants. Counsel for Florida Export and the Comptroller then debated the merits of the case before the hearing officer, i.e., whether the Comptroller should have denied the refund because the profit participation charges were legally taxable under section 212.031, Florida Statutes (1979). DOR, not being a party, did not participate. On March 19, 1981, the hearing officer issued a recommended order on the merits, finding the charges legally taxable and recommending that the Comptroller deny Florida Export's application for a refund.

While the recommended order was under consideration by the Comptroller, all appellants filed a motion for determination of legal issues in the circuit court action. That motion contended that the circuit court had jurisdiction of the case without the necessity of appellants further exhausting administrative remedies (R. 56-58). On April 6, 1981, the circuit court entered an order finding that it had jurisdiction over the dispute and that, under the facts and circumstances of the case, there was no need for appellants “to utilize administrative hearing procedures or exhaustive prosecution of these causes.” The circuit court ruled, nevertheless, that since Florida Export had an administrative proceeding pending on the issue of the validity of the tax assessments, the court action would be stayed pending a final resolution of the administrative proceeding (R. 63-65).

On April 27,1981, the Comptroller issued a final order ruling that the refund would be denied because the profit participation payments were taxable under section 212.-031. Florida Export appealed the order to this court, which affirmed without opinion. Florida Export Tobacco Co., Inc. v. Office of Comptroller, 412 So.2d 475 (Fla. 1st DCA 1982).

On November 19, 1982, all appellants filed an amended complaint in the pending consolidated circuit court actions, naming the Comptroller, in addition to DOR, as defendants. The amended complaint alleged that the taxes assessed by DOR on the profit participation charges were illegal, that appellants’ applications for refund of taxes previously paid were denied by the office of the Comptroller, and that appellants were entitled to an order declaring such taxes unlawful and invalid. Defendants moved for summary judgment on the ground that the relief sought by plaintiffs was barred under the doctrine of res judicata by the Comptroller’s administrative decision affirmed by this court. On February 24, 1984, the circuit court granted final summary judgment, concluding as a matter of law that the doctrine of res judicata prohibited relitigation of the legal issues raised in the petition for administrative hearing. That judgment is before us on this appeal.

II.

THE ISSUES

Appellants raise two points. They contend that the Comptroller lacked jurisdiction to adjudicate the legality of the tax assessment by reason of section 20(c)(3), article V, Florida Constitution, as amended in 1972. This section states, “[Ujntil changed by general law consistent with sections 1 through 19 of this article,” the circuit courts of this state “shall have exclusive original jurisdiction ... in all cases involving legality of any tax assessment or toll.” Appellants argue that section 20(c)(3) provided exclusive jurisdiction in the circuit court to determine the legality of any tax assessment and that the administrative proceedings before the Comptroller were without subject matter jurisdiction and did not validly determine the legality of the challenged tax assessment. Therefore, appellants argue, the circuit court erred in determining that the administrative proceedings are res judicata because it is improper to give such effect to a judgment or order of a tribunal lacking subject matter jurisdiction.

For their second point, appellants argue that even if jurisdiction in the administrative agency be upheld, the doctrine of res judicata should not be applied when to do so defeats the ends of justice, and they cite authority to support this principle. Appellants contend that the evident confusion of the parties and the circuit judges concerning the proper procedure and need for exhaustion of administrative remedies, their perceived uncertainty of the effect of this court’s affirmance, without opinion, of the Comptroller’s decision, and their persistent attempts to preserve their right to proceed in circuit court, rather than by administrative proceedings, would make it unfair and unjust to deprive them of the right to litigate the tax assessment issue in circuit court. This is especially so, they say, since Florida Export was the only party to the administrative proceeding.

DOR and the Comptroller dispute appellants' contentions on several grounds. First, they suggest that "no tax assessment is involved in this case. Primarily, however, they contend that the 1972 amendments to article V gave the legislature power to change by general law the circuit court’s exclusive original jurisdiction over disputes involving the legality of tax assessments, and that the appropriate administrative agency has been given, by implication, concurrent jurisdiction with circuit courts to decide the legality of tax assessments as a result of the enactment of the 1974 amendments to the Administrative Procedures Act, chapter 120, Florida Statutes. Appellees urge that the constitution has authorized this grant of quasi-judicial power to administrative officers or boards in matters connected with the functions of their offices, citing Transgulf Pipeline v. Board of County Commissioners, 438 So.2d 876 (Fla. 1st DCA 1983), pet. for rev. denied, 449 So.2d 264 (Fla.1984); State, Department of Administration v. Stevens, 344 So.2d 290 (Fla. 1st DCA 1977), and other cases.

Appellees further argue that appellants have had the merits of the legality of the assessment fully and fairly litigated in the administrative proceeding, that the administrative decision has been upheld upon review by the appellate court, and that, therefore, the application of res judicata will not defeat the ends of justice.

Because the appropriate agency’s exercise of quasi-judicial power is limited to matters connected with the functions of the administrative office, we note that the respective power, roles, and duties of DOR and the Comptroller in respect to determining the legality of tax assessments is a critical factor underlying appellees' argument.

III.

TAX ASSESSMENT

Initially, DOR and the Comptroller say we need not consider the effect of the constitutional provision regarding circuit court jurisdiction because appellants' actions seek only a refund of taxes for which no tax assessment was issued. Appellees cite no statutory or decisional authority for this contention, and we have found none which directly supports it.

The Florida Statutes do not contain a definition of assessment, so we must look to the ordinary definition and usage of the term in construing the constitution and statute. Southeastern Fisheries Ass’n, Inc. v. Department of Natural Resources, 453 So.2d 1351 (Fla.1984). “Assessment” is defined as “the act of assessing” or “an amount assessed.” American Heritage Dictionary, page 79 (New College Edition 1979). The word “assess” is usually defined as including:

1. To estimate the value of (property) for taxation.

2. To set or determine the amount of (a tax, fine or other payment).

3. To charge (a person or property) with a tax, fine, or other special payment.

Id. at 79. See also Black’s Law Dictionary (5th ed. 1979); Oxford English Dictionary (Compact Ed. 1971). With the accepted definitions in mind, we conclude that the term “assessment,” as used in chapter 212, Florida Statutes, encompasses the instant situation, where a taxpayer has refused to pay a sales tax on a rental payment under chapter 212 and DOR has communicated the amount of taxes claimed to be due under that chapter and made a demand for the taxpayer to make payment. See § 212.14, Fla.Stat. (1979). Although section 212.031, Florida Statutes (1974), requires that a landlord bill and collect the sales tax on rental, file a return thereon, and remit payment to DOR, that section nevertheless places the tax on the tenant. Zero Food Storage v. Department of Revenue, 330 So.2d 765 (Fla. 1st DCA), cert, denied, 339 So.2d 1174 (Fla.l976). Accordingly, DOR’s notice of tax due and demand for payment of the tax constitutes an assessment that is reviewable in circuit court. See Department of Revenue v. Ryder System, Inc., 406 So.2d 1299 (Fla. 1st DCA 1981). That such notice and demand amounts to a tax assessment is further supported by DOR’s interpretation of the statutes in rule 12A-1.056(6), Florida Administrative Code, which provides that when a lessor fails to make a report and pay the tax due, or makes a grossly incorrect report of the tax due, DOR “shall make an assessment from an estimate for the taxable period and shall proceed to collect such taxes on the basis of such assessment which shall be considered pri-ma facie correct.”

In the present case, appellants had not paid any sales tax on the profit participation charge to Dade County, and the county had not reported any tax due thereon when it filed its returns with DOR. DOR, therefore, “assessed” such taxes when it determined that Dade County’s sales tax return was incorrect and communicated by letter to Dade County that the county was required to bill appellants for the sales taxes due on the profit participation charges, collect the taxes, and remit the collected monies to DOR. We hold that appellants’ cause of action in this case amounts to a challenge of “the legality of a tax assessment” within the meaning of article V, section 20(c)(3), Florida Constitution, and the related implementing statutes hereafter discussed.

IV.

RES JUDICATA AND JURISDICTION

The propriety of the lower court’s application of the doctrine of res judicata turns on whether the required identity of parties and issues was shown to exist, and whether the administrative tribunal had jurisdiction to adjudicate the issues said to bar the action in the court below.

Res judicata is not applicable unless the parties to the current proceeding were also parties to the prior proceéding said to have adjudicated the issue. Seaboard Coastline R.R. v. Industrial Contracting Co., 260 So.2d 860, 862 (Fla. 4th DCA 1972). For this reason alone the circuit court erred in granting summary judgment against the appellants other than Florida Export, because they took a voluntary dismissal from the administrative proceedings before it went to final hearing. The alleged statement of counsel that a favorable result in the Florida Export administrative proceeding would be stare decisis did not make these appellants parties to that proceeding and did not satisfy this essential requirement of the doctrine of res judicata. The statement did not make that proceeding binding on these appellants. See note 8 at p. 6, supra.

Res judicata cannot be predicated on the decision of a tribunal lacking jurisdiction. A judicial or quasi-judicial decision will not be given res judicata effect where rendered by a tribunal lacking subject matter jurisdiction. Florida National Bank v. Kassewitz, 156 Fla. 761, 25 So.2d 271 (1946); Bryant v. Small, 258 So.2d 459 (Fla. 3d DCA), cert, denied, 265 So.2d 51 (Fla.1972). Subject matter jurisdiction can not be created by waiver, acquiescence or agreement of the parties, or by error or inadvertence of the parties or their counsel, or by the exercise of power by the court; it is a power that arises solely by virtue of law. Florida National Bank v. Kassew-itz, 25 So.2d 271. See generally 32 Fla. Jur.2d, Judgments & Decrees, §§ 131, 332 (1981).

It is, therefore, essential to the validity of the trial court’s ruling on res judicata that the Comptroller (the only party to the administrative proceeding) had subject matter jurisdiction, i.e., the power, to adjudicate appellants’ challenge to the legality of the tax assessments against them. Whether the Comptroller had such power involves two lines of inquiry. The first is the extent to which constitutional and statutory provisions gave the Comptroller power to adjudicate the legality of tax assessments when this case was filed in 1979. The second is whether in 1979 the provisions of article V of the Florida Constitution and related statutes preserved in the circuit court exclusive original jurisdiction to decide the legality of disputed tax assessments.

A.

ADJUDICATORY POWER OF THE COMPTROLLER AND DOR

The Comptroller’s powers and duties are delineated in article IV of the Florida Constitution and diverse implementing statutes. Section 4(d) of article IV provides simply that “the comptroller shall serve as the chief fiscal officer of the state, and shall settle and approve accounts against the state.” Chapter 17, Florida Statutes, prescribes the general powers and duties of the Comptroller. At all times material to this dispute, the Comptroller’s authority regarding claims against the state was set forth in section 17.03(1), Florida Statutes (1979):

The Comptroller of this state, using generally accepted auditing procedures for testing or sampling, shall examine, audit, and settle all accounts, claims, and demands, whatsoever, against the state, arising under any law or resolution of the Legislature, and issue his warrant to the Treasurer directing him to pay out of the State Treasury such amount as shall be allowed by the Comptroller thereon.

The authority so prescribed is analogous to that of an accounting auditor charged with determining, in accordance with generally accepted auditing procedures, that the claim presented is correct in form and amount and is consistent with the substantive power of the agency ordering payment. We decline to construe this statutory provision to implicitly include the power to adjudicate the merits of the underlying claim, as is more fully explained hereafter.

Specific authority and responsibilities formerly placed on the Comptroller regarding assessment and collection of taxes may be found throughout several chapters in title XIV, Florida Statutes. Prior to 1963, the Comptroller was given complete authority to administer the various state tax statutes, including sales taxes under chapter 212, and to collect the revenues due pursuant to such statutes. The Comptroller also was given authority under section 215.26, Florida Statutes (1961), to approve the refund of taxes upon a timely sworn application in proper form, “supplemented with such additional proof as is necessary to establish such claim.”

in 1963 the legislature transferred the duties of administering the tax statutes from the Office of the Comptroller to the State Revenue Commission. Ch. 63-253, § 7, Laws of Florida. Section 212.15, Florida Statutes (1963), as amended, provided that all taxes collected under chapter 212 would be remitted to the Commission and that any taxpayer who contested an assessment under chapter 212 would have the right to request the Commission to reexamine .the assessment. If the Commission’s decision was determined adversely to the taxpayer, then the taxpayer had the right to bring an action in circuit court to challenge the legality of the assessment. Section 215.26, however, continued to provide the Comptroller with authority to pay refunds.

In 1969 the legislature created the Department of Revenue and transferred to it the authority to administer the tax statutes and to collect taxes due. Ch. 69-106, § 21(2), Laws of Florida. Section 212.15(4) was amended by that chapter to provide that DOR review and determine contested tax assessments prior to the taxpayer’s bringing an action in circuit court. Ch. 69-106, §§ 21, 35, Laws of Florida. Certain portions of the 1969 amendments remained in effect at the time of this dispute. See §§ 213.05 and 212.18(2), Fla.Stat. (1979). The statutory authority of the Comptroller to pay refunds under section 215.26 was not altered by the 1969 act.

Thereafter, the authority of the Comptroller and DOR regarding tax assessments and refunds remained unchanged until 1978. In that year the legislature repealed section 212.15(4), Florida Statutes (1977), which had given taxpayers the right to have tax assessments under chapter 212 reviewed by DOR prior to initiating a proceeding in circuit court. Ch. 78-95, Laws of Florida. In the introductory clause to that law, it was stated that section 212.-15(4) was in conflict with or had been rendered unnecessary by the Administrative Procedures Act, chapter 120, Florida Statutes. The legislature also amended section 215.26, Florida Statutes, to read as quoted in note 3, supra.

This amendment to section 215.26 clarified the respective roles of DOR and the Comptroller in the administration of the sales tax statutes and applications for refunds. It expressly directed that applications for refund be filed with and received by the Comptroller, but further gave the Comptroller discretion to delegate this ministerial function of receiving applications to the state agency vested by law with the responsibility to collect the tax (DOR in this instance). Upon receipt of such application, however, only the agency to which the tax had been paid (DOR) was empowered to determine the amount of the tax and authorize a refund. The Comptroller continued to have authority under section 215.26 to refund taxes paid with monies from the state treasury, but only upon DOR’s approval manifested in a properly executed voucher authorizing such payment. We have found no statutory provision giving the Comptroller authority to overrule DOR’s determination regarding the legality of the tax assessment and the right to a refund.

Our review of the constitutional and statutory provisions establishing the respective authority of the Comptroller and DOR leads us to conclude that in 1979 the Comptroller had no administrative power to review and adjudicate the legality of tax assessments made by DOR under chapter 212. That administrative power lay only with DOR. Section 215.26 vested authority in the Comptroller to order disbursement of funds from the state treasury only after DOR, the state agency charged with administering the sales tax statute, recommended a refund and furnished a voucher to the Comptroller, who in turn was to determine that DOR’s voucher was in proper form and duly executed and issued pursuant to DOR’s legal authority.

This conceptual nature of the Comptroller’s power and duties was aptly described in Florida Development Commission v. Dickinson, 229 So.2d 6 (Fla. 1st DCA 1969), cert denied, 237 So.2d 530 (Fla. 1970):

The trial judge described the duty imposed upon the Comptroller by the Constitution as it relates to payment of accounts against the state most fully, and we think it appropriate to quote from his order the following material observations:

It is the duty of the Comptroller, before issuing a warrant for the payment of an account against the state, to make an administrative determination that the money is in the state treasury, that an appropriation has been made by law to pay the account, and that the expenditure is within the law fixing the powers of the state agency incurring the obligation. The Comptroller has no authority to supervise the operation of other state officers or state agencies in the exercise of the discretion vested in them by law. Neither does he have the power to veto their action in the performance of their legal duties. On the other hand, the duty of the Comptroller to audit, adjust and settle the accounts of all officers of the state, conferred by Section 23, Article IV, of the Constitution, would be destroyed if the Comptroller is required to pay all bills approved by all state officers without exercising any power to ascertain that the proposed expenditure of state funds is authorized by law.

So long as an expenditure is within the lawful power of another officer, the Comptroller has no authority to, in any manner or to any degree, control the exercise of the official discretion of that officer in the expenditure of state funds. But if any state agency exceeds its lawful power or goes outside the scope of the discretion vested in it by law in incurring obligations, it is the duty of the Comptroller to refuse to issue state warrants in payment of such obligations.

The complexity of modern government is such that it is not infrequent that questions arise as to the proper construction of statutes authorizing and regulating the expenditure of state funds. The agency administering a statute must, in the first instance, make an administrative determination of the scope of its powers. That determination is entitled to great respect from, but is not absolutely binding upon, the Comptroller. If the Comptroller is convinced that another state officer or agency has exceeded its lawful powers in incurring a bill against the state, it is the duty of the Comptroller to refuse to issue a warrant for the payment of that bill from state funds until such time as there has been a determination of the question. In many instances such determination is accomplished by an opinion of the Attorney General. However, the Comptroller has the legal right to refuse to be a party to a disbursement of public funds which he considers illegal until there has been a judicial determination of the validity of the proposed expenditure.

229 So.2d at 8 (emphasis added.)

To summarize, according to the explicit terms of section 215.26, DOR was required to review applications for tax refunds and determine the legality of its assessment.

If DOR determined that the refund should be denied, it was required to notify the applicant of such denial and state the reasons therefor. If DOR determined that a refund should be granted, then it was required to forward to the Comptroller a properly executed voucher authorizing payment of such refund. At that time the Comptroller had authority to review the voucher to assure that it was in due form, correct in amount, and properly executed by DOR. But the Comptroller was not given statutory authority to review and adjudicate the substantive legality of the disputed assessment by evaluating the facts and law and substituting his own judgment for the legal reasons relied upon by DOR in authorizing or denying the requested refund.

In this case appellants applied to the Comptroller for a refund under section 215.26 on grounds that sales taxes could not be legally assessed on the profit participation charges. Their applications were referred by the Comptroller to DOR, and DOR determined to deny the claim. The Comptroller then advised appellants of this denial and that they had a right to a section 120.57 hearing. An administrative hearing was timely requested and held, but only Florida Export and the Comptroller were parties to the hearing and final order entered in that administrative proceeding. After hearing evidence and argument on the legality of the tax assessment, the hearing officer recommended that the legality of the assessment be sustained and the refund denied. This recommended order was reviewed and approved by the Comptroller, not by DOR, even though whether the hearing officer’s recommended findings and conclusions of law on the legality of the assessment should be approved fell within DOR’s authority, not the Comptroller’s. Hence, DOR was an essential party to the administrative adjudication of the legality of the claim for refund. The importance of having DOR, rather than the Comptroller, review the hearing officer’s recommended order is materially enhanced by the fact that all members of the cabinet, not just a single member, may participate in DOR’s decision on the legality of the tax assessment.

Appellees’ have erroneously assumed in their briefs, without citation of authority, that the Comptroller was empowered to adjudicate the legality of appellants’ claims for refund. Certainly the Comptroller was authorized to issue a warrant for the payment of-the requested refund and was a proper party to the administrative proceeding; but most assuredly he was not the only essential party. We find no statutory support for appellees’ assumption that the Comptroller alone could adjudicate the legality of the disputed assessment or provide substantive review of the grounds of DOR’s denial of the refund applications in a section 120.57 proceeding. Nor have we found any reported case holding that DOR is not an essential or necessary party to such proceeding.

Irrespective of whether DOR was an essential party, however, it nevertheless follows that DOR’s absence as a party to Florida Export’s administrative proceeding for refund has deprived that administrative decision of the attributes previously discussed, i.e., the identity of essential parties and issues, required to make that decision binding and support the application of res judicata in this court action against DOR.

B.

CIRCUIT COURT JURISDICTION Determining whether the circuit court had been divested by general law of its historic exclusive original jurisdiction to adjudicate the legality of tax assessments requires careful review of the article V amendments and implementing statutes.

Article V, section 1, of the 1968 Florida constitution vested the judicial power of Florida in the various courts and, altema-tively, in legislatively established commissions. It provided as follows:

Courts. — The judicial power of the State of Florida is vested in a supreme court, district courts of appeal, circuit courts, Court of Record of Escambia County, criminal courts of record, county courts, county judge’s courts, juvenile courts, courts of justices of the peace, and such other courts, including municipal courts, or commissions, as the legislature may from time to time ordain and establish.

Section 6, article V, of the 1968 constitution was entitled “Circuit Courts.” Subsection 6(3), formerly section 11, article V, of the 1885 constitution (prior to the 1956 revision), was entitled “Jurisdiction.” This subsection specified the jurisdiction of circuit courts as follows:

JURISDICTION. The circuit courts shall have exclusive original jurisdiction in all cases in equity except such equity jurisdiction as may be conferred on juvenile courts, in all cases at law not cognizable by subordinate courts, in all cases involving the legality of any tax, assessment, or toll, in the action of ejectment, in all actions involving the titles or boundaries of real estate, and in all criminal cases not cognizable by subordinate courts. They shall have original jurisdiction of actions of forcible entry and unlawful detainer, and of such other matters as the legislature may provide.

(Emphasis added.) Thus, the 1968 constitution unambiguously authorized circuit courts to exercise exclusive original jurisdiction over all cases involving the legality of any tax, assessment, or toll.

Article V was substantially rewritten in the 1972 amendment. Section 1 continued to be the section vesting judicial power and was expanded to read as follows:

COURTS. — The judicial power shall be vested in a supreme court, district courts of appeal, circuit courts and county courts. No other courts may be established by the state, any political subdivision or any municipality. The legislature shall, by general law, divide the state into appellate court districts and the judicial circuits following county lines. Commissions established by law, or administrative officers or bodies may be granted quasi-judicial power in matters connected with the functions of their offices.

(Emphasis added.) With this change of language, the constitution permitted the legislature, by duly enacted legislation, to grant appropriate quasi-judicial power to administrative officers or bodies so long as it pertained to matters connected with the functions of their offices. Section 5(b) of article V, as amended in 1972 (formerly section 6(3) of article V, 1968 constitution), described the jurisdiction of circuit courts:

JURISDICTION. — The circuit courts shall have original jurisdiction not vested in the county courts, and jurisdiction of appeals when provided by general law. They shall have the power to issue writs of mandamus, quo warranto, certiorari prohibition and habeas corpus, and all writs necessary or proper to the complete exercise of their jurisdiction. Jurisdiction of the circuit court shall be uniform throughout the state. They shall have the power of direct review of administrative action prescribed by general law.

(Emphasis added.) It should be noted that the words “original jurisdiction” were no longer modified by the word “exclusive.” Section 20, article V, as adopted in 1972, carried forward the existing jurisdiction of the circuit courts in the following language:

SECTION 20. Schedule to Article V.—

(a) This article shall replace all of Article V of the Constitution of 1885, as amended, which shall then stand repealed.

(b) Except to the extent inconsistent with the provisions of this article, all provisions of law and rules of court in force on the effective date of this article shall continue in effect until superseded in the manner authorized by the constitution.

(c)After this article becomes effective, and until changed by general law consistent with sections 1 through 19 of this article:

if # # # # #

(3) Circuit courts shall have jurisdiction of appeals from county courts and municipal courts, except those appeals which may be taken directly to the supreme court; and they shall have exclusive original jurisdiction in all actions at law not cognizable by the county courts; of proceedings relating to the settlement of the estate of decedents and minors, the granting of letters testamentary, guardianship, involuntary hospitalization, the determination of incompetency, and other jurisdiction usually pertaining to courts of probate; in all cases in equity including all cases relating to juveniles; of all felonies and of all misdemeanors arising out of the same circumstances as a felony which is also charged; in all cases involving legality of any tax assessment or toll; in the action of ejectment; and in all actions involving the titles or boundaries or right of possession of real property.

(Emphasis added.) Section 20, being a schedule to article V, was intended to provide for the transition from the old to the new court system and served to preserve the existing jurisdiction of all courts “until changed by general law” consistent with sections 1 through 19 of article V. Thus, section 20 continued exclusive original jurisdiction over the legality of tax assessments in circuit courts.

We agree with DOR and the Comptroller that the 1972 amendments to the constitution authorized the legislature to give administrative officers and agencies quasi-judicial jurisdiction in matters connected with the functions of their offices, and that such jurisdiction could legally be exercised concurrently with original, nonexclusive jurisdiction given to circuit courts over the same matters. See State ex rel. Jones v. Wiseheart, 245 So.2d 849 (Fla.1971); State ex rel. York v. Beckman, 160 Fla. 810, 36 So.2d 769 (1948); State v. Sullivan, 95 Fla. 191, 116 So. 255 (1928). We likewise agree that such “quasi-judicial jurisdiction” could, by general law expressly so providing, embrace disputes over the legality of tax assessments. Based upon extensive additional research and study, we find no legal impediment to the legislature’s enactment of general legislation to permit DOR to administratively adjudicate the legality of tax assessments, should the taxpayer so elect. The critical question, however, is to what extent, if any, the legislature had done so by 1979, when this controversy arose and the court proceeding was filed.

In 1972 the Florida legislature implemented the amendments to article V respecting circuit court jurisdiction by providing in section 26.012, Florida Statutes (1972 Supp.), that circuit courts “shall have exclusive original jurisdiction” in “all cases involving legality of any tax assessment or toll.” The constitutional and statutory changes made in 1972 did not, therefore, abrogate the existing exclusive original jurisdiction of circuit courts in such cases, but merely provided that such jurisdiction could be expressly “changed by general law.” Williams v. Law, 368 So.2d 1285 (Fla.1979); St. Joe Paper Co. v. Metropolitan Dade County, 418 So.2d 1013 (Fla. 3d DCA 1982), pet. for rev. denied, 430 So.2d 451 (Fla.1983).

Section 212.15, Florida Statutes (1973), readopted without change by section 11.-2421, Florida Statutes (1973), also left undisturbed the exclusive original jurisdiction of circuit courts over actions challenging the validity of tax assessments. Cf, Williams v. Law, 368 So.2d 1285; St. Joe Paper Co. v. Metropolitan Dade County, 418 So.2d 1013. Section 212.15 directed the circuit court to determine the legality of the assessment and contained provisions requiring the taxpayer to either pay or secure the payment of the disputed taxes as a condition of filing suit.

DOR and the Comptroller contend that in making massive revisions to the Administrative Procedures Act in 1974 by enactment of chapter 74-310, Laws of Florida, “the legislature ... exercised its authority in art. V, § 1, and ... granted to the Department of Revenue and the Comptroller quasi-judicial power to conduct administrative hearings concerning matters connected with the functions of their offices.” (Ap-pellees’ motion for rehearing, p. 8). But we have found no statutory or decisional authority to support a construction of chapter 74-310 as divesting the circuit courts of their exclusive original jurisdiction over tax assessment controversies.

No provision in chapter 74-310 expressly granted agency jurisdiction over the legality of tax disputes in contravention of the otherwise explicit constitutional and statutory provisions discussed above. Section 120.57 merely provided in general language that any person substantially affected by agency action would be entitled to an administrative hearing in respect to the matter in dispute as part of the process leading to final agency action. No attempt was made to amend the provisions of the statutes explicitly giving circuit courts exclusive original jurisdiction over the legality of tax assessments. Section 3 of chapter 74-310 provided that:

(1) The intent of the legislature in enacting this complete revision of chapter 120, Florida Statutes, is to make uniform the rule-making and adjudicative procedures used by the administrative agencies of this state. To that end, it is the express intent of the legislature that the provisions of this act shall replace all other provisions in the Florida Statutes, 1973, relating to rulemaking, agency orders, administrative adjudication or judicial review, except marketing orders adopted pursuant to chapters 573 and 601, Florida Statutes, and that the division of statutory revision of the joint legislative management committee is directed to prepare a reviser’s bill to conform the Florida Statutes to such intent.

(Emphasis added.) Yet section 26.012(2)(e) (giving circuit courts “exclusive original jurisdiction”) was not repealed, revised, or amended in any reviser’s bill pursuant to this direction; rather, it remained intact and in full force and effect until amended in 1981 (see discussion, infra, pp. 952-953).

Moreover, in 1975 the legislature enacted chapter 75-191, § 11, Laws of Florida, which provided language in section 120.73 to explicitly clarify that chapter 74-310 was not intended to repeal statutory provisions granting the right to proceed in circuit court rather than by administrative hearing. That section specifically stated:

Nothing in this chapter [120] shall be construed to repeal any provision of the Florida Statutes which grants the right to a proceeding in the circuit court in lieu of an administrative hearing.... If any action has been dismissed or otherwise disposed of on the ground that a provision of the statutes granting the right to a trial or the jurisdiction to render declaratory judgments was repealed by chapter 74-310, Laws of Florida, such action shall be reinstated by order of the court upon the filing of a petition by the plaintiff at any time during the 60-day period immediately following the effective date of this act.

In the years immediately following the 1974 amendments to chapter 120, DOR attempted to establish through litigation in the courts that chapter 120 provided the taxpayers an administrative remedy for handling tax disputes that was itself exclusive of circuit court jurisdiction. Several cases between DOR and taxpayers considered that argument and consistently held that the historical original jurisdiction of circuit courts over such matters was not affected or impliedly repealed by the provisions of chapter 120. Department of Revenue v. Amrep Corp., 358 So.2d 1343 (Fla. 1978); Department of Revenue v. University Square, Inc., 336 So.2d 371 (Fla. 1st DCA), cert, denied, 342 So.2d 1101 (Fla. 1976); Accord State ex rel. Department of General Services v. Willis, 344 So.2d 580, 589 (Fla. 1st DCA 1977); Department of Revenue v. Crisp, 337 So.2d 404 (Fla. 2d DCA 1976), cert, denied, 346 So.2d 1248 (Fla.1977); Department of Revenue v. Estero Bay Development Co., 336 So.2d 479 (Fla. 2d DCA 1976), cert, denied, 345 So.2d 422 (Fla.1977); Department of Revenue v. Joanos, 364 So.2d 24 (Fla. 1st DCA 1978), cert, denied, 372 So.2d 467 (Fla. 1979). In University Square, Inc., 336 So.2d at 371-72, Judge Mills succinctly stated the rationale underlying this conclusion:

Section 120.73, Florida Statutes, clearly expresses the intent of the Legislature that circuit courts retain jurisdiction to determine the legality of contested documentary tax assessments by way of declaratory judgment actions.

In response to the Department’s argument, it is our opinion that there are no provisions in Chapter 120, Florida Statutes, which directly or by implication divest the circuit courts of their historical jurisdiction to determine the issues in contested documentary tax assessment actions. We are confident that had the Legislature intended to do this, it would have said so in specific language, and would have expressly repealed the inconsistent laws.

In a similar vein, in Department of Revenue v. Crisp, 337 So.2d at 405, the court stated:

The Florida legislature has determined that the circuit courts shall have exclusive original jurisdiction in all cases in equity and in all cases involving legality of any tax assessment. Fla.Stat. § 26.-012(2)(c), (e); Fla. Const., art. V, sec. 20(3). See Department of Revenue v. University Square, Inc., Fla.App. 1st 1976, 336 So.2d 371. We agree with the reasoning of the First District Court of Appeal in University Square that if the legislature had intended to divest the circuit courts of jurisdiction over this matter it would have repealed or amended Fla.Stat. § 26.012. Department of Revenue v. University Square, Inc., supra.

There is a significant difference between the hearings authorized by Fla.Stat. § 26.012 and those of Fla.Stat. § 120.68. Section 26.012 requires that the circuit court sit as a court of original jurisdiction providing an opportunity for full judicial proceedings while 120.68(4) limits the district court of appeal to appellate jurisdiction where the scope of review is confined to the record transmitted to it by the agency. We do not believe that the restricted review authorized by the APA preempts the complete hearing prescribed in 26.012.

In Department of Revenue v. Amrep Corp., 358 So.2d 1343, the supreme court concurred with the rationale in University Square and Crisp. After noting that section 26.012, Florida Statutes (1975), contained provisions for “exclusive original jurisdiction” in the circuit courts “in all cases involving legality of any tax assessment,” the court stated:

In like fashion, Article V, Section 20(c)(3), Florida Constitution, provides, inter alia, that “until changed by general law” circuit courts shall have exclusive original jurisdiction “in all cases involving legality of any tax assessment or toll.” We concur with the holding and reasoning of the District Court of Appeal, First District, in Department of Revenue v. University Square, Inc., supra, that there are no provisions in Chapter 120, Florida Statutes, including Section 3 of Chapter 74-310, Laws of Florida, which directly or by implication divest the circuit courts of their historical jurisdiction to determine the issues in contested tax assessment actions such as the dispute in the instant case.

358 So.2d at 1348-49.

Once more we conclude that the 1974 revisions to chapter 120, as enacted in chapter 74-310, Laws of Florida, did not explicitly or impliedly repeal or modify the constitutional and statutory provisions giving circuit courts both original and exclusive jurisdiction of cases contesting the legality of a tax assessment and seeking a refund of taxes paid. Section 20 of article V, and section 26.012(2)(e), Florida Statutes (1979), continued to vest exclusive original jurisdiction in the circuit courts to hear and resolve disputes over the legality of tax assessments until such time as section 26.012 should be amended by general law expressly altering that explicit provision for exclusive jurisdiction.

Appellees argue that this result is inconsistent with the supreme court’s decision in Department of Revenue v. Amrep Corp., as the court in that case recognized the existence of concurrent jurisdiction of the administrative agency and circuit courts by the language in footnote 5 to that opinion. That footnote states:

The conclusion that this action is cognizable as a matter of original jurisdiction in the circuit court does not affect the jurisdiction of the district courts of appeal and this Court to review agency action pursuant to § 120.68, Fla.Stat. (1975).

(Emphasis in original.) 358 So.2d at 1349, n. 5. But this argument by appellees overstates the import of the Amrep Corp. decision. The footnote refers only to “original jurisdiction” because the court was not deciding whether “exclusive” jurisdiction of tax assessment disputes lay in the circuit court, but deciding whether such courts continued to possess original jurisdiction by virtue of the cited constitutional and statutory provisions. Moreover, the footnote is appended to a discussion of this court’s opinion in Department of Revenue v. Young American Builders, 330 So.2d 864 (Fla. 1st DCA 1976), concerning court jurisdiction to decide constitutional attacks on the validity of Department of Revenue rules, and therefore must be read in context with the issues being decided in Am-rep Corp., i.e., the constitutional validity of section 199.023(7), Florida Statutes (1975). Certainly, final agency action deciding matters not falling within the exclusive original jurisdiction of circuit courts, such as claims based on events occurring subsequent to a valid assessment and payment of taxes, may be properly reviewed under section 120.68 if the party elects, despite a statutory provision for original (but not exclusive) jurisdiction of such disputes in circuit court. It would appear, therefore, that the quoted footnote was included only to obviate a misconstruction and misapplication of the court’s Amrep opinion in other contexts. Cf Estate of W.T. Grant Co. v. Lewis, 358 So.2d 76 (Fla. 1st DCA 1978), affd, 370 So.2d 764 (Fla.1979), in which this court accepted jurisdiction under section 120.68 to review DOR’s denial of a sales tax refund over contentions by DOR and the Comptroller that exclusive jurisdiction of this question lay in the circuit court, because the issue under review did not involve the legality of a tax assessment, “but rather involves solely the question of petitioner’s right to a refund of sales taxes lawfully assessed in the first instance but for which petitioner contends it became entitled to refund due to a condition arising subsequent to the assessment.” 358 So.2d at 78.

We also attach no controlling significance to the repeal, in 1978, of section 212.15(4), which provides for review in the circuit court of Leon County, by section 54, chapter 78-95, Laws of Florida. Section 26.012, not section 212.15, vested exclusive jurisdiction in circuit courts to hear tax assessment cases. Section 54 left intact the provisions in section 212.15(5) which described the powers and duties of circuit courts when hearing tax assessment cases. The repeal of provisions in section 212.15(4) did not expressly affect circuit court jurisdiction to adjudicate the legality of tax assessments, and we find no basis for treating this 1978 enactment as impliedly repealing or modifying the provisions of section 26.012. Applying the test enunciated in Department of Revenue v. Am-rep Corp., 358 So.2d at 1348, we do not view section 54 of chapter 78-95 as a “positive repugnancy” to section 26.012, and thus hold that section 54 was not “clearly intended to prescribe the only governing rule, or that it revises the subject matter of the former.”

Review of subsequent legislative history with respect to section 26.012(2) is appropriate to confirm our interpretation of legislative intent that circuit courts continued to have exclusive original jurisdiction over the legality of tax assessments. See Parker v. State, 406 So.2d 1089, 1092 (Fla. 1982). Prior to 1981 widespread confusion existed throughout this state regarding required tax procedures and the proper forum for resolving state tax controversies. See generally 1 Florida State & Local Taxes, paragraph 10.04 (The Florida Bar 1984); 2 Florida Administrative Practice Manual, § 15.05(e). In 1981 the legislature enacted chapter 81-178, Laws of Florida, entitled “An act relating to civil procedures in certain tax controversies,” in an attempt to eliminate the prevailing confusion by making significant revisions to the statutes relating to civil tax procedures for contesting the legality of tax assessments. Of particular relevance to this case are the amendments to section 26.012(2)(e), the creation of new section 72.011, and the repeal of section 212.15(5).

Section 1, chapter 81-178, amended section 26.012(2) to add the following underlined language providing that circuit courts “shall have exclusive original jurisdiction ... (e) In all cases involving legality of any tax assessment or toll, except as provided in s. 213.19.” The creation of this exception by the legislature manifested explicit recognition that exclusive original jurisdiction of cases contesting the legality of tax assessments had been placed in circuit courts by section 26.012(2)(e) up to that time. Had the legislature intended, through any of its prior statutory enactments and amendments, to deprive the circuit courts of this historical exclusive original jurisdiction in tax assessment cases and permit only concurrent jurisdiction with the appropriate administrative agency, the adoption of the statutory exception to facilitate such administrative action, as done by this 1981 amendment, would have been unnecessary and a clearly superfluous act.

Section 213.19 referred to in this amendment (later codified as section 72.011 in Florida Statutes 1981) was an entirely new section created by section 11 of chapter 81-178. Section 72.011 provided detailed provisions by which a taxpayer could contest the legality of a tax assessment under chapter 212 (and other chapters in title XIV, Florida Statutes) “by filing an action in circuit court, or alternatively the taxpayer may file a petition under the applicable provisions under chapter 120.” It expressly precluded the taxpayer from filing an action in court once a section 120.56, 120.-565, or 120.157 proceeding had been initiated regarding the same subject matter, and expressly limited appellate review in such instances to that provided under section 120.68. On the other hand, once a court action had been initiated, no action could be initiated under chapter 120. Essentially, the statute permitted the taxpayer to proceed in an administrative hearing or in court without first having to pay the disputed tax. It required, however, as a condition to filing an action in court, that the taxpayer tender the disputed amount into the registry of the court or post a bond to secure payment of the disputed tax. But most significant to this case, section 72.011(5) made the alternative administrative procedure established by section 72.011 “not applicable to actions for refund for taxes previously paid.”

It is obvious, therefore, that in 1981 the legislature expressly authorized, for the first time, an administrative procedure for contesting tax assessments and expressly changed by general law the existing exclusive original jurisdiction of circuit courts, but explicitly excepted from this administrative procedure “actions for refund of taxes previously paid.” See 50 Fla.Jur.2d, Taxation, §§ 13:2 — 4 (1983). Newly created section 72.011, when read in para materia with section 26.012(2)(e), as amended, thus preserved the exclusivity of circuit court original jurisdiction in tax refund cases. For this reason, the explicit legislative clarification of DOR’s concurrent jurisdiction made in section 72.011, Florida Statutes (1981), even if susceptible to retroactive effect as suggested by appellees, would not remove this refund case from the circuit court’s exclusive original jurisdiction. Additionally, we note that section 18, chapter 81-178, repealed subsection (5) of section 212.15, and justifiably so, as those provisions had now been made superfluous by the new provisions in section 72.011.

Moreover, this statutory scheme substantially parallels the federal practice and procedure regarding income taxes under the Internal Revenue Code. See 1 Fla.State & Local Taxes, paragraph 10.04[1] (Fla.Bar 1984). Notably, the federal procedure requires that refund actions be filed in federal district courts (where a jury trial may be obtained) or in the Court of Claims. See generally 34 Am.Jur.2d, Federal Taxation, paragraph 9324.

Therefore, in the face of such consistent statutory provisions explicitly granting circuit courts exclusive original jurisdiction of actions for refund based on the illegality of the tax assessment, we decline to imply that the amendments to chapter 120 in chapter 74-310, Laws of Florida, afforded either DOR or the Comptroller concurrent jurisdiction in such cases.

C.

CONCLUSION

To summarize, appellants were assessed and paid taxes on their profit participation lease payments. Thereafter they sought determination of the legality of the assessment and refund of the taxes so paid by filing an action against DOR in circuit court. After the filing of that action, at the somewhat ambiguous direction of the circuit court, they filed an administrative claim for refund with the Comptroller. When the claim was denied, Florida Export pursued a petition for section 120.57 administrative review. DOR, although an essential party to that dispute, was not made a party to the administrative proceeding. The Comptroller did not have the power to adjudicate the merits of the legality of the assessment. Appellants did not, by their attempts to comply with the circuit court’s directions to seek a refund, waive or stipulate away their rights to pursue their action in circuit court. Under the circumstances, the circuit court had exclusive original jurisdiction to adjudicate the legality of the tax assessment against appellants in their refund action. It was error, therefore, for the trial court to grant summary judgment on the grounds of res judicata.

DOR and the Comptroller, and also the Tax Section’s motion, point out that several hundred cases by taxpayers with DOR and the Comptroller have been handled administratively, and that the district courts of appeal and the supreme court have affirmed decisions in a number of those cases without questioning the jurisdiction of the administrative agencies. They further argue that the validity of those decisions will be placed in jeopardy by a ruling that circuit courts have exclusive original jurisdiction in this case, especially if such ruling is made retroactive. For all we know, the precise jurisdictional question presented in this case was presented in none of those cases, so we cannot treat those cases as controlling. Jurisdiction is conferred on courts and administrative agencies by constitutional provisions and statutes duly enacted by the legislature, not by court decision. Our function is limited to reasonably construing the lawful language of those provisions without enlarging by implication a tribunal’s specified jurisdiction simply because such jurisdiction may have been exercised previously without objection and it now seems politic or, for that matter, in the public interest to create or recognize such enlarged jurisdiction. Under section 1, article V, of the Florida constitution, only the legislature has the power to confer and specify the extent of an administrative agency’s quasi-judicial jurisdiction.

To avoid unnecessary concern and misinterpretation of this opinion, it is appropriate to state what we do not decide. We do not find it necessary to reach and decide whether the 1981 and subsequent amendments creating section 72.011 can be given retroactive effect in appropriate cases, nor do we decide the extent of DOR’s quasi-judicial power to adjudicate tax disputes not involving tax refund claims such as this.

We also do not decide whether this decision must be given retroactive effect to invalidate decisions in other cases which have proceeded to finality. Our decision today should be read as passing, based on t