author: SEE, Justice.

text:
    Ex parte Luneal BARNETT, as administrator of the estate of Robert Shorter, deceased. (In re Francina Morales v. Luneal Barnett, as administrator of the estate of Robert Shorter, deceased).
    1060174.
    Supreme Court of Alabama.
    Aug. 3, 2007.

      J. Mark Hart and Allen R. Trippeer, Jr., of Haskell Slaughter Young & Rediker, Birmingham, for petitioner.
    Bruce J. McKee and James R. Moncus III of Hare, Wynn, Newell & Newton, L.L.P., Birmingham, for respondent.
   SEE, Justice.

Facts and Procedural History

Francina Morales was injured in June 2003 when she was struck by an automobile driven by Robert Shorter. She sued Shorter, claiming damages in the amount of $175,000. During the course of the litigation, Shorter died, and Luneal Barnett, as the administrator of Shorter’s estate, was substituted as the defendant. Morales received $20,000 from her insurer, GEICO, under the underinsured-motorist provisions of her automobile-liability insurance policy. At trial, the jury awarded Morales damages of $35,000, and Barnett moved for a set-off of $20,000 to account for the insurance proceeds Morales had already received from GEICO. The trial court denied the motion and entered a judgment for Morales in the amount of $35,000. Barnett moved for the trial court to reconsider its ruling denying the set-off, and the trial court then amended its judgment to reduce the amount of the judgment by the $20,000 insurance payment. In doing so, the trial court relied on Batchelor v. Brye, 421 So.2d 1267 (AIa.Civ. App.1982), for its holding that a jury verdict against a defendant tortfeasor is subject to a set-off in the amount of the underinsured-motorist policy proceeds paid to the plaintiff.

The Court of Civil Appeals reversed the trial court’s judgment, limiting the holding in Batchelor to cases involving joint tort-feasors. Morales v. Barnett, 978 So.2d 722 (Ala.Civ.App.2006). The Court of Civil Appeals held that the collateral-source rule prohibits the trial court from reducing the damages recoverable from Shorter’s estate by the amount of the underinsured-motorist policy proceeds Morales received. We granted Barnett’s petition for the writ of certiorari to consider this holding.

Standard of Review

“Where the facts are not in dispute and we are presented with a pure question of law, as here, this Court’s review is de novo.” Christian v. Murray, 915 So.2d 23, 25 (Ala.2005) (citing State v. American Tobacco Co., 772 So.2d 417, 419 (Ala.2000), Ex parte Graham, 702 So.2d 1215, 1221 (Ala.1997), and Beavers v. County of Walker, 645 So.2d 1365, 1372 (Ala.1994)).

Analysis

Under the collateral-source rule, “an amount of damages is not decreased by benefits received by a plaintiff from a source wholly collateral to and independent of the wrongdoer .... ” Williston v. Ard, 611 So.2d 274, 278 (Ala.1992). In this case, the Court must determine whether uninsured/underinsured-motorist (“UM”) insurance benefits are a collateral source for the purposes of the collateral-source rule.

Barnett does not appear to question the applicability of the collateral-source rule generally; instead, she argues that the collateral-source rule does not apply in cases involving UM insurance. For this argument, Barnett cites the Court of Civil Appeals’ decision in Batchelor v. Brye, supra. She also argues that the “unique” and “hybrid” nature of UM insurance militates against applying the collateral-source rule in a case involving UM insurance.

Barnett first argues that the Court of Civil Appeals erred in distinguishing the present case from Batchelor v. Brye, supra. In Batchelor, the father of a boy killed in an automobile accident sued his UM insurance carrier and two joint tort-feasors, one of whom was insured and the other not. The plaintiff and the insurance carrier settled the UM claim for $10,000. The plaintiff then proceeded to trial against the two joint tortfeasors. The jury returned a verdict against the joint tort-feasors, assessing the plaintiffs damages at $30,000. The insured defendant paid $20,000 into the court and then moved to have the $30,000 judgment ordered satisfied. The trial court granted the motion, and the Court of Civil Appeals affirmed, concluding:

“The plaintiffs insurer ... stood in the shoes of the uninsured motorist ... as a source of payment to the plaintiff.... Though the jury, without knowledge of the plaintiffs settlement with [his insurer], later found the plaintiffs damages to be $30,000, the plaintiff had already received one-third of that amount from his insurer due to the liability of [the uninsured motorist].”

Batchelor, 421 So.2d at 1268-69. The court further noted that “while uninsured motorist payments may be used to partially meet the plaintiffs measure of damages, the plaintiff is never entitled to recover from any source more than the actual measure of damages.” 421 So.2d at 1269. The court in Batchelor concluded that “[t]he goal of uninsured motorist coverage is to make the plaintiff whole but not to allow double recovery.” 421 So.2d at 1269. For this reason, the court reduced the plaintiffs damages by virtue of the settlement with the UM insurance carrier and allowed “the $10,000 received by the plaintiff under the uninsured motorist provision of his policy [to] be used to partially satisfy the $30,000 judgment.” 421 So.2d at 1268. We agree with Barnett that Batchelor is largely on point.

The court in Batchelor did not discuss our cases applying the collateral-source rule, but “[i]t is well settled that the amount paid by an insurer to a plaintiff for damage to his vehicle does not affect his measure of recovery and that evidence of an insurance payment is not ordinarily admissible.” Jones v. Carter, 646 So.2d 651, 653 (Ala.1994). “ ‘The collateral source doctrine ... provides that damages recoverable for a wrong are not diminished because the injured party has been wholly or partially indemnified or compensated for his loss by insurance effected by him and to which the wrongdoer did not contribute ....”’ Mitchell v. Moore, 406 So.2d 347, 351 (Ala.1981) (quoting Powell v. Brady, 30 Colo.App. 406, 414, 496 P.2d 328, 332-33 (1972)). Batchelor appears to run afoul of the collateral-source rule. Thus, we must either overrule , it or hold that the collateral-source rule does not apply to UM insurance benefits.

Barnett argues that the collateral-source rule should not apply to UM insur-anee benefits because its application would allow Morales to receive a double recovery and to be in a better position following the accident than if the accident had not occurred. Alabama law generally bars double recoveries, and, although “ ‘a party is entitled to full compensation for his injuries,’” Wilbourn v. Ray, 603 So.2d 969, 972 (Ala.1992) (quoting McClendon v. City of Boaz, 395 So.2d 21, 26 (Ala.1981)), he “ ‘can gain but one satisfaction.’ ” Lee L. Saad Constr. Co. v. DPF Architects, P.C., 851 So.2d 507, 521 (Ala.2002) (quoting Mobile Ins., Inc. v. Smith, 441 So.2d 894, 896 (Ala.1983)). Thus, according to Barnett, the trial court correctly set off the $20,000 that Morales’s UM insurance carrier paid to Morales pursuant to her UM insurance policy, and the judgment was satisfied when Barnett’s insurer paid the remaining $15,000 of the judgment.

The rule against double recoveries bars a plaintiff from recovering more than her full damages when payments have been made by a tortfeasor or on behalf of a tortfeasor. 4 Restatement (Second) of Torts § 920A(1) (1972). “The collateral-source rule is an exception to the general rule of damages preventing a double recovery by an injured party.” Wills v. Foster, 372 Ill.App.3d 670, 673, 867 N.E.2d 1223, 1226, 311 Ill.Dec. 237, 240 (2007); see also Hardaway Mgmt. Co. v. Southerland, 977 S.W.2d 910, 918 (Ky. 1998) (“There is a strong public policy in this Commonwealth against double recovery for the same elements of loss. An exception, of course, is the collateral source rule that ‘damages recoverable for a wrong are not diminished by the fact that the injured party has been wholly or partly indemnified by insurance (to whose procurement the wrongdoer did not contribute).’ ” (emphasis omitted)). This Court has stated that “the amount paid by an insurer to a plaintiff for damage to his vehicle does not affect his measure of recovery ....” Jones v. Carter, 646 So.2d 651, 653 (Ala.1994); see also Jones v. Crawford, 361 So.2d 518, 522 (Ala.1978) (“The courts of this state have held many times that what has occurred between insurer and insured is of no concern to the defendant — that the sum received from insurance cannot be shown in mitigation of damages for the injury.” (footnote omitted) ); Sturdivant v. Crawford, 240 Ala. 383, 385, 199 So. 537, 538 (1940) (“The amount paid by the insurance company [for the damage to the plaintiffs car] does not even affect the measure of recovery. The insurance of the property is a mere indemnity, and insurer and insured are regarded as one person. The mere fact that the insurer had paid the insured cannot affect the action against the wrongdoer who has destroyed or injured the property, the subject of the insurance.”). Thus, the collateral-source rule generally precludes the trial court from deducting from the damages award the benefits the plaintiff received from an insurance policy, notwithstanding the fact that the plaintiff may receive what appears to be a “double recovery.”

Barnett argues that we should follow Haynes v. Yale-New Haven Hospital, 243 Conn. 17, 27, 699 A.2d 964, 969 (1997), which held that “for the particular purpose of characterizing underinsured motorist payments, the relationship ... between the underinsured carrier and the defendant may be viewed as analogous to that of joint tortfeasors, and thus that the general tort rale precluding double recovery from joint tortfeasors should apply.” (Footnote omitted.) Under Alabama law, among defendants jointly liable for the injury to the plaintiff, “where one tortfeasor settles, we have allowed the nonsettling tortfeasor to have the jury award reduced by the amount of any pro tanto settlement.” Ex parte Goldsen, 783 So.2d 53, 56 (Ala.2000). On the other hand, where the tortfeasors are not jointly liable, the nonsettling party “cannot ... claim a set-off for any amount received by the plaintiff in settlement with other defendants, based on the distinct acts of those defendants.” Torsch v. McLeod, 665 So.2d 934, 939-40 (Ala.1995). The issue, then, is whether, under Alabama law, a UM insurance carrier may be characterized as a joint tortfeasor along with the actual tortfeasor.

“ ‘Joint tortfeasors’ are ‘those who act together in committing wrong, or whose acts if independent of each other, unite in causing [a] single injury.’ ” Lowry v. Garrett, 792 So.2d 1119, 1122 (Ala.Civ.App.2001) (quoting Black’s Law Dictionary 839 (6th ed.1990)). “If damage results from concurrent, wrongful acts of two or more tort-feasors, they may be sued jointly or severally and the act of each may be counted on as the proximate cause of the injury....” Butler v. Olshan, 280 Ala. 181, 192, 191 So.2d 7, 17 (1966). “The policy in favor of the pro tanto satisfaction for joint tort-feasors is well established in Alabama law upon the theory that the right of action against joint tort-fea-sors is one and indivisible.” Hardman v. Freeman, 337 So.2d 325, 326 (Ala.1976) (footnote omitted).

In this case, however, it is clear that Morales’s UM insurance carrier committed no wrongful act that united with Barnett’s negligence to cause a single injury, and her UM insurance carrier, therefore, was not a joint tortfeasor. Instead, a UM insurance carrier’s liability to the insured is based solely on its contractual obligations as laid out in the policy. Continental Nat’l Indem. Co. v. Fields, 926 So.2d 1033, 1037 (Ala.2005) (holding that the cause of action for recovery under the uninsured-motorist statute is contractual in nature); Howard v. Alabama Farm Bureau Mut. Cas. Ins. Co., 373 So.2d 628, 629 (Ala.1979) (“An action based on the uninsured motorist provisions of a liability policy is ex contrac-tu in nature.”). Although the tortfeasor’s liability triggers the insurer’s obligation to pay, that liability serves only to establish that the insured “is entitled to recovery under the terms of the policy.” Howard, 373 So.2d at 629. We therefore decline to treat a UM insurer as a joint tortfeasor.

Barnett argues that the UM insurance carrier stands in the shoes of the tortfea-sor as a “surrogate excess insurer” of the underinsured motorist, so that “both the tortfeasor and the [UM] carriers’ payments should be considered made on behalf of the tortfeasor towards satisfaction of the judgment .... ” Barnett’s reply brief at 7, Barnett’s brief at 11. Although we recognize that the UM insurance carrier’s liability is triggered when the plaintiff establishes the tortfeasor’s liability, we disagree that this means that any payment made by the insurer is made “on behalf of the tortfeasor.”

Section 32-7-23, Ala.Code 1975, which requires an automobile liability insurance policy to make available UM coverage, states that this coverage is “for the protection of persons insured thereunder .... ” That the UM insurer does not pay the insured “on the behalf of the tortfeasor” is evidenced by the fact that it is the insured who pays the premiums for the UM coverage, not the uninsured-motorist tortfeasor. The benefits “did not come from the defendant or a person acting for him.” Restatement (Second) of Torts § 920A cmt. b.; see also State Farm Mut. Auto. Ins. Co. v. Board of Regents of Univ. Sys., 226 Ga. 310, 311, 174 S.E.2d 920, 922 (1970) (“[P]ayments made by the insurance company under the policy are not payments made by or on behalf of the uninsured motorist-tortfeasor .... ”); Bradley v. H.A. Manosh Corp., 157 Vt. 477, 484-85, 601 A.2d 978, 983 (1991) (“[T]he UM carrier has a status different from that of insurance carriers who represent other tortfea-sors. Their contractual obligation is to persons allegedly at fault, whereas the contractual obligation of the UM carrier is to the injured party.”). Instead, the UM insurance benefits are the result of the plaintiffs decision to pay the premiums for UM insurance.

The UM insurer is not in privity with the tortfeasor. Haynes, 243 Conn. at 25, 699 A.2d at 968 (“We recognize that an underinsured motorist carrier ‘is not the alter ego of the tortfeasor and ... they do not share the same legal [status].... ’ The fact that the carrier and the tortfeasor do not share a complete legal identity, and thus are not in privity with each other, does not automatically resolve the narrower question of how payments made pursuant to an underinsured motorist policy should be treated.” (quoting Mazziotti v. Allstate Ins. Co., 240 Conn. 799, 817, 695 A.2d 1010, 1019 (1997))). Further, the tortfeasor could not demand contribution from the UM insurer if he had paid a judgment and the insurer had not. See Harleysville Mut. Ins. Co. v. Nationwide Mut. Ins. Co., 789 F.2d 272, 275 (4th Cir.1986) (“Nationwide’s contractual and statutory obligation is to satisfy a judgment its insured [Hollingsworth] may obtain against Doe. It has no obligation to satisfy any judgment others may obtain against Doe. Nothing in the Virginia statute or in the policy may be construed to give that effect. For exactly the same reason that Nationwide is liable to Hollingsworth, it is not liable to Baker or LaValleys or to Harleysville [Mutual Insurance Co.], their insure[r], for any right of contribution they may have against Doe. It simply has no contractual or statutory obligation to this effect. Neither does the common law create any such obligation”).

Barnett argues nonetheless that, because UM insurance has a “unique” and “hybrid” nature in relation to other forms of insurance, the collateral-source rule does not apply in cases involving UM insurance. She bases this argument on the fact that the tortfeasor must be shown by the insured to be both liable and uninsured before the UM insurance carrier has any duty to pay UM benefits. However, the requirement that the insured establish the liability of an uninsured motorist simply concerns whether the insured is entitled to recover under the UM insurance policy. Howard, 373 So.2d at 629. As noted above, the insurer’s duty to pay arises from the insurance contract, and, like any insurance contract, the insurer has no duty to pay a noncovered claim. Barnett in her reply brief says as much, noting that under first-party insurance policies, “all the insured must do is show an event or peril within the policy coverage.” Barnett’s reply brief at 9. The same is true for UM insurance; establishing that an uninsured motorist is liable serves to show that the peril was within the coverage of the policy.

For the foregoing reasons, we hold that UM insurance benefits are a collateral source that may not be used to diminish an award in favor of the plaintiff. To the extent that it is inconsistent with this opinion, we overrule Batchelor v. Brye, 421 So.2d 1267 (Ala.Civ.App.1982). In doing so, we note that the majority of jurisdictions that have addressed the issue agree that the collateral-source rule applies to UM insurance benefits paid to the insured. See International Sales-Rentals Leasing Co. v. Nearhoof, 263 So.2d 569, 571 (Fla.1972) (holding that neither the UM statute, caselaw, nor the contract in the case allowed the defendant to set off UM benefits paid to the plaintiff); State Farm Mut. Auto. Ins. Co. v. Board of Regents of Univ. Sys., 226 Ga. at 311, 174 S.E.2d at 922 (“[P]ayments made by the insurance company under the policy are not payments made by or on behalf of the uninsured motorist-tortfeasor, and do not affect the uninsured motorist’s liability to pay the damages recovered in the lawsuit against him.”); Dyet v. McKinley, 139 Idaho 526, 531, 81 P.3d 1236, 1241 (2003) (holding that UM insurance benefits are a collateral source); Beaird v. Brown, 58 Ill.App.3d 18, 21, 373 N.E.2d 1055, 1057, 15 Ill.Dec. 583, 585 (1978) (“[W]e find that payments received by the plaintiffs pursuant to their uninsured motorist coverage were received from a collateral source.”); Southard v. Lira, 212 Kan. 763, 770, 512 P.2d 409, 415 (1973) (“Nor are payments made by an insurance carrier under uninsured motorist coverage, payments which a tort-feasor can utilize to diminish the amount of his liability to the injured party.”); Estate of Rattenni v. Grainger, 298 S.C. 276, 278, 379 S.E.2d 890, 890 (1989) (“We find no persuasive reason to distinguish underin-surance proceeds from other insurance proceeds that are subject to the collateral source rule.”); and Johnson v. General Motors Corp., 190 W.Va. 236, 244, 438 S.E.2d 28, 36 (1993) (“[W]e hold that the collateral source rule operates to preclude the offsetting of uninsured or underin-sured benefits since the benefits are the result of a contractual arrangement which is independent of the tortfeasor .... ”).

Finally, Barnett argues that, “[i]f any party has a right to pursue Barnett[,] it would be GEICO for subrogation; however, the record does not show that GEICO preserved or made any attempt to pursue reimbursement for its [UM] payment.” However, Barnett offers no reference to the record supporting the proposition that Morales has contractually granted GEICO a right of subrogation. Indeed, Barnett affirmatively asserts that “the record does not show that GEICO preserved or made any attempt to pursue reimbursement for its [UM] payment.” See Ex parte Howell, 974 So.2d 304, 306 (Ala.2007) (“ ‘A reviewing court cannot predicate error on matters not shown by the record.... Indeed, a silent record supports a judgment.... It is the appellant’s duty to file a correct record.’ ” (quoting Robinson v. State, 444 So.2d 884, 885 (Ala.1983))). Nor does Barnett offer any authority to support what may be an implicit assertion that GEICO’s payment to Morales effects a legal subro-gation that cuts off any claim Morales may have had. Birmingham News Co. v. Horn, 901 So.2d 27, 78 (Ala.2004) (opinion on application for rehearing) (“ ‘Where an appellant fails to cite any authority for an argument, this Court may affirm the judgment as to those issues, for it is neither this Court’s duty nor its function to perform all the legal research for an appellant.’ ” (quoting Sea Calm Shipping Co. v. Cooks, 565 So.2d 212, 216 (Ala.1990))). Therefore, we reject this argument as well.

Conclusion

We affirm the judgment of the Court of Civil Appeals holding that the collateral-source rule prohibits the reduction of Morales’s damages award by the amount of Morales’s UM benefits.

AFFIRMED.

COBB, C.J., and WOODALL, SMITH, and PARKER, JJ., concur.

      . Section 32-7-23(b)(4), Ala.Code 1975, defines an "uninsured motor vehicle” as a vehicle with respect to which "[t]he sum of the limits of liability under all bodily injury hability bonds and insurance policies available to an injured person after an accident is less than the damages which the injured person is legally entitled to recover.”

      . The Court of Civil Appeals interpreted Batchelor as "implicating the legal principle that one joint tortfeasor may offset damages assessed by joint negligence by the amount of a pro tanto settlement entered into by another tortfeasor." Morales, 978 So.2d at 726. It concluded that, because the case before us now did not involve two joint tortfeasors, Batchelor is distinguishable. The Court of Civil Appeals does not explain the mechanics of this distinction, and other jurisdictions have held that the collateral-source rule applies in cases of joint tortfeasors. Pacific Gas & Elec. Co. v. Superior Court, 28 Cal.App.4th 174, 180-81, 33 Cal.Rptr.2d 522, 526-27 (1994) (rejecting defendant’s argument that the collateral-source rule does not apply in the case of joint tortfeasors); Adkins v. Knight, 256 Ga.App. 394, 395, 568 S.E.2d 517, 519 (2002) (holding that the collateral-source rule applies where the combined negligence of an unknown driver and the defendant caused the accident); and Klosterman v. Fussner, 99 Ohio App.3d 534, 539-40, 651 N.E.2d 64, 68 (1994) (applying the collateral-source rule where one defendant committed an intentional tort and the other tortfeasor was merely negligent).

      . Barnett cites State Farm Mutual Automobile Insurance Co. v. Mason, [Ms. 2050488, January 12, 2007] - So.2d -, - (Ala.Civ.App.2007), rev’d on other grounds, Ex parte Mason, [Ms. 1060665, July 27, 2007] - So.2d-(Ala.2007), for the proposition that " ‘despite the contractual relation between plaintiff insured and defendant insurer, this [action for UM benefits] is actually one for the tort allegedly committed by the uninsured motorist.' ” (Quoting Brown v. Lumbermens Mutual Casualty Co., 285 N.C. 313, 319, 204 S.E.2d 829, 834 (1974).) That case addressed whether an insured was “entitled to recover” against his UM insurance carrier, and noted "that a condition precedent to recovery has been legislatively imposed: an insured must possess an actionable claim against an uninsured motorist before proceeding against his or her UM carrier.” Mason, - So.2d at -. Mason did not hold that the UM insurance carrier is liable for the tort so as to make it jointly liable with the tortfeasor.

      . The Supreme Court of Connecticut has rejected the application of the collateral-source rule in the context of underinsured-motorist insurance. That court stated:
      “We begin with the fundamental princi- , pie that the purpose of underinsured motorist insurance is to place the insured in the same position as, but no better position than, the insured would have been had the underinsured tortfeasor been fully insured.
      ... Under the plaintiff’s argument, however, she is in a better position because her decedent had been struck by an underin-sured driver than she would have been had the same driver been fully insured. ...
      "Furthermore, the plaintiff's putative right to recover against the defendants in the present case, for the loss that her decedent’s underinsured motorist carrier has already paid, depends solely on the order of litigation in this case. ...
      "... Under the plaintiff’s argument, however, when she pursues her underinsured motorist policy first, as she in fact did, she can recover, not only the $650,000 that she received from her decedent’s underinsured motorist carrier, but an additional amount for the same damages when she then brings an action against the defendants. Had the exact same claims been presented in a different order, however — namely, an action against the defendants first, rather than second — she agrees that she could recover only a total of $650,000. ... Put another way, it cannot be the law that underinsured motorist benefits are, or are not, a ‘collateral source’ depending solely on when they are sought. ...
      "Finally, the equities do not weigh substantially in favor of the plaintiff’s position. Precluding the plaintiff from obtaining double recovery does not deprive the decedent of the benefit for which she paid her under-insured motorist premium, namely, a guaranteed recovery of her wrongful death damages, subject to contractual limits, despite the fact that she was hit by an underinsured motorist, and whether there was a joint tortfeasor who could also be held liable. The only thing she is deprived of is the opportunity to recover more than she paid for.”

        Haynes, 243 Conn. at 27-31, 699 A.2d at 969-72 (footnotes omitted). The Supreme Court of Connecticut also rejected the argument that the rule it adopted in Haynes created a windfall for the defendant: "In such cases, however, the policy behind the fundamental principle barring double recovery ... simply is deemed to outweigh the policy behind the collateral source rule.
      ... Such a consequence is, therefore, not a windfall under the law, but rather a necessary consequence of a fundamental policy choice.” Haynes, 243 Conn. at 31-32, 699 A.2d at 972. We note, however, that the UM insurer can avoid double recovery by the insured by providing in its contract of insurance for the right of subrogation against the uninsured/underinsured tortfea-sor.

      . We also note that Barnett has not offered any authority for the implicit proposition that what has happened contractually between Morales and GEICO affects Morales's standing as against her. See Jones v. Crawford, 361 So.2d 518, 522 (Ala.1978) (“The courts of this state have held many times that what has occurred between the insuror and the insured is of no concern to the defendant — that the sum received from insurance cannot be shown in mitigation of damages for the injury.” (footnote omitted)); see also Southard v. Lira, 212 Kan. at 769, 512 P.2d at 414 (“The reasons generally given for the [collateral-source] rule are that the contract of insurance and the subsequent conduct of the insurer and insured in relation thereto are matters with which the wrongdoer has no concern and which do not affect the measure of his liability.”).

      . We also reject Barnett’s argument that the collateral-source rule is merely a rule of evidence and that the rule does not bar the trial court from reducing the damages award based on the payment of UM benefits to the plaintiff. See American Legion Post No. 57 v. Leahey, 681 So.2d 1337, 1343 (Ala.1996) (holding that the collateral-source rule is both a rule of evidence and of substantive law), overruled on other grounds, Marsh v. Green, 782 So.2d 223, 233 (Ala.2000); see also Williston v. Ard, 611 So.2d 274, 278 (Ala.1992) ("[A]n amount of damages is not decreased by benefits received by a plaintiff from a source wholly collateral to and independent of the wrongdoer ....”); and Restatement (Second) of Torts § 920A(2) ("Payments made to or benefits conferred on the injured party from other sources are not credited against the tortfeasor's liability, although they cover all or a part of the harm for which the tortfeasor is liable.”).


source: Caselaw Access Project

author: CRAWLEY, Presiding Judge.

license: Public Domain

text:
    HEALTHSOUTH CORPORATION v. JEFFERSON COUNTY TAX ASSESSOR, Dan Weinrib; and Jefferson County Tax Collector, J.T. Smallwood.
    2050538.
    Court of Civil Appeals of Alabama.
    Oct. 27, 2006.

      W. Howard Donovan III and Justin D. Fingar of Johnston, Conwell & Donovan, LLC, Birmingham; Robert D. Segall and Shannon L. Holliday of Copeland, Franco, Screws & Gill, P.A., Montgomery; and Loree Skelton, Birmingham, for appellant.
    Charles S. Wagner, asst, county atty., Birmingham, for appellees.
   CRAWLEY, Presiding Judge.

The facts of this tax case are virtually undisputed. In the period prior to 2002, several officials at the HealthSouth Corporation (“HealthSouth”) were involved in a scheme to artificially inflate the company’s reported earnings. In furtherance of this scheme, HealthSouth overstated its fixed assets by recording fictitious items of personal property in the fixed-asset books of many of its facilities, including the corporate headquarters located in Jefferson County. Consequently, when HealthSouth completed its personal-property tax returns for the 2001-2003 tax years and submitted them to Dan Weinrib, the Jefferson County tax assessor (“the tax assessor”), it intentionally listed numerous fictitious items of personal property and assigned fabricated values to those items. The fabricated values of those fictitious items of personal property were assessed to HealthSouth by the tax assessor, which resulted in an increase in the amount of ad valorem taxes on personal property owed and paid by HealthSouth.

HealthSouth amended its 2003 tax returns to remove the fictitious assets. This amendment reduced the assessment and resulting tax owed by HealthSouth, and the tax assessor allowed an adjustment to the amount of taxes owed by HealthSouth, pursuant to § 40-7-9.1, Ala.Code 1975. Testimony indicated that the tax assessor allowed this adjustment because the taxes had not yet been paid.

HealthSouth then amended its 2001 and 2002 personal-property tax returns and filed petitions for a refund of the portion of ad valorem taxes it claims it overpaid as a result of listing the fictitious items of personal property on its tax returns for those years. HealthSouth alleged in those petitions that it was due a refund pursuant to § 40-10-160, Ala.Code 1975, because those taxes were paid by mistake or error. J.T. Smallwood, the Jefferson County tax collector (“the tax collector”), requested an opinion from the attorney general on the matter, and the attorney general determined that no refund was due because, in the attorney general’s opinion, Health-South had made no mistake or error that would trigger the refund statute. The tax collector denied the petitions for refunds of taxes paid for the 2001 and 2002 tax years based on that opinion from the attorney general. HealthSouth then filed this action in the probate court and, after an ore tenus hearing, the probate court denied HealthSouth’s refund petitions. Health-South timely appealed to this court.

Although HealthSouth raises numerous issues on appeal, those issues can be summarized as follows: (1) whether Health-south is entitled to a refund of ad valorem taxes paid for the 2001 and 2002 tax years pursuant to § 40-10-160, Ala.Code 1975, because the terms “mistake,” “error,” and/or “other error” in the statute encompass intentional misrepresentations; (2) whether the assessment of ad valorem taxes on the fictitious items HealthSouth intentionally listed on its tax returns in furtherance of a fraudulent scheme to inflate earnings amounted to an illegal assessment; and (3) whether HealthSouth is entitled to a refund of the taxes paid for the 2001 and 2002 tax years because the tax assessor allowed an adjustment of the taxes paid for 2003, which were part of the same fraudulent scheme, pursuant to § 40-7-9.1, Ala.Code 1975.

Standard of Review

Because the relevant facts of this case are undisputed and this court is presented with issues regarding the correct application of the law to those undisputed facts, the standard of review is de novo, and no presumption of correctness is accorded to the trial court’s judgment. See Ex parte Graham, 702 So.2d 1215 (Ala.1997); Roberts Health Care, Inc. v. State Health Planning & Dev. Agency, 698 So.2d 106 (Ala.1997); State Dep’t of Revenue v. Garner, 812 So.2d 380, 382 (Ala.Civ.App.2001); and State Dep’t of Revenue v. Taft Coal Sales & Assocs., Inc., 801 So.2d 838, 839 (Ala.Civ.App.2001).

Analysis

I.

HealthSouth first contends that, pursuant to § 40-10-160, AÍa.Code 1975, it is entitled to a tax refund for the portion of the personal-property ad valorem taxes it claims it overpaid for the 2001 and 2002 tax years as a result of intentionally listing fictitious items of personal property on its tax returns along with fabricated values for those items because, it claims, the use of the words “mistake,” “error,” and “other error” in that statute indicate that the legislature intended “mistake” and “error” to have different meanings. HealthSouth asserts that the word “error” is broader in meaning than the word “mistake” and that an “error” includes intentional misrepresentations.

Section 40-10-160, Ala.Code 1975, explains when a taxpayer is entitled to recover a refund of taxes paid by mistake or error; it states:

“Any taxpayer who through any mistake, or by reason of any double assessment, or by any error in the assessment or collection of taxes, or other error, has paid taxes that were not due upon the property of such taxpayer shall be entitled, upon making proof of such payment to the satisfaction of the Comptroller, to have such taxes refunded to him if application shall be made therefor, as hereinafter provided, within two years from the date of such payment.”

In Bean Dredging, L.L.C. v. Alabama Department of Revenue, 855 So.2d 513 (Ala.2003), the Alabama Supreme Court stated the following regarding statutory construction:

“It is this Court’s responsibility to give effect to the legislative intent whenever that intent is manifested. State v. Union Tank Car Co., 281 Ala. 246, 248, 201 So.2d 402, 403 (1967). When interpreting a statute, this Court must read the statute as a whole because statutory language depends on context; we will presume that the Legislature knew the meaning of the words it used when it enacted the statute. Ex parte Jackson, 614 Solid 405, 406-07 (Ala.1993). Additionally, when a term is not defined in a statute, the commonly accepted definition of the term should be applied. Republic Steel Corp. v. Horn, 268 Ala. 279, 281, 105 So.2d 446, 447 (1958). Furthermore, we must give the words in a statute their plain, ordinary, and commonly understood meaning, and where plain language is used we must interpret it to mean exactly what it says. Ex parte Shelby County Health Care Auth., 850 So.2d 332 (Ala.2002).”

855 So.2d at 517.

In DeKalb County LP Gas Co. v. Suburban Gas, Inc., 729 So.2d 270, 276 (Ala.1998), the Supreme Court stated:

“It is true that when looking at a statute we might sometimes think that the ramifications of the words are inefficient or unusual. However, it is our job to say what the law is, not to say what it should be. Therefore, only if there is no rational way to interpret the words as stated will we look beyond those words to determine legislative intent. To apply a different policy would turn this Court into a legislative body, and doing that, of course, would be utterly inconsistent with the doctrine of separation of powers. See Ex parte T.B., 698 So.2d 127, 130 (Ala.1997).”

The pertinent language of the Code section in question is: “Any taxpayer who through any mistake, ... or by any error in the assessment or collection of taxes, or other error, has paid taxes that were not due upon the property of such taxpayer. ...” Nothing in § 40-10-160, Ala.Code 1975, leads us to believe that the legislature intended anything other than the plain meaning of those words. We do not find the language to be ambiguous, and because the legislature failed to define the words “mistake” and “error,” we must give those words their common, everyday meaning. The term “mistake” is defined as “a wrong action or statement proceeding from faulty judgment, inadequate knowledge, or inattention.” Merriam-Webster’s Collegiate Dictionary 795 (11th ed.2003). The term “error” is defined as “an act involving an unintentional deviation from truth or accuracy.” Merriamr-Web-ster’s Collegiate Dictionary 425 (11th ed.2003). Although HealthSouth may be correct that the plain meaning of the word “mistake” is slightly different from the plain meaning of the word “error,” we are clear to the conclusion that an intentional misrepresentation is not included in the plain meaning of either word.

Furthermore, we are persuaded by the attorney general’s opinion. The Alabama Supreme Court has recognized that an attorney general’s opinion, although not binding, can be persuasive authority. See Anderson v. Fayette County Bd. of Educ., 738 So.2d 854, 858 (Ala.1999), and Alabama-Tennessee Natural Gas Co. v. Southern Natural Gas Co., 694 So.2d 1344, 1346 (Ala.1997) (citing Poe v. Grove Hill Mem’l Hosp. Bd., 441 So.2d 861, 863 (Ala.1983)).

The attorney general issued an opinion concluding that § 40-10-160, Ala.Code 1975, does not allow a refund of taxes when the taxpayer has made an intentional misrepresentation to the taxing authority. The attorney general’s opinion stated:

“Section 40-10-160 of the Code of Alabama must be construed in light of the common law that preceded it. The common-law rule regarding a refund of taxes voluntarily paid has been stated as follows:
“ ‘[A] party may not recover taxes or charges voluntarily made unless such recovery is authorized by statute....
“ ‘Generally, if a taxpayer pays an illegal tax, with knowledge of facts sufficient to frame a protest, and if the payments were not made under duress or compulsion, the payment is deemed to be voluntary and cannot be recovered.’
“72 Am.Jur.2d State and Local Taxation § 979 (2004). Accord, e.g., Town Council of Cahaba v. Burnett, 34 Ala. 400 (1859).
“This Office has recognized that, contrary to the common-law rule, there shall not be read into section 40-10-160 of the Code a provision requiring compulsion or protest. Opinion to Honorable Derrell R. Hann, Judge, Probate Court, Talladega County, dated February 21, 1990, A.G. No. 90-00164, citing Graves v. McDonough, 264 Ala. 407, 88 So.2d 371 (1956). Taxes may, therefore, be refunded under section 40-10-160, even though they are voluntarily paid. C.f. City of Birmingham v. Piggly Wiggly Ala. Distrib. Co., 638 So.2d 759 (Ala.1994) (considering a refund of municipal taxes under section 40-10-164 of the Code of Alabama, which expressly exempts compulsion or protest).
“The intentional misrepresentation of the value of property by the taxpayer for property tax purposes does not constitute a mistake of law or fact by the taxpayer. There were neither double assessments nor any errors in the assessment or collection of the taxes made by the taxing officials.
“To conclude that a refund is due in every case in which taxes were paid in an incorrect amount simply because the taxes were paid voluntarily and without protest would apply the refund rule out of context. The history of the rule indicates that a refund was never intended to be available where the tax paid was incorrect because of intentional misrepresentations by the taxpayer for personal gain. At common law, a refund was warranted if it was involuntarily paid under protest. A taxpayer cannot, however, be expected to protest a result the taxpayer wanted. Graves does not indicate that this aspect of the rule changed when the rule was codified and the protest requirement was eliminated. Therefore, the taxpayer is entitled tó a refund where the taxpayer gives inaccurate information resulting in the illegal tax only if that information was mistakenly or inadvertently given. C.f. A.G. No. 90-00164.”

Op. Att’y Gen. No. 2005-096 (March 30, 2005). The attorney general has issued numerous opinions regarding this statute, none of which approved a refund under facts similar to those in this case. In addition, the attorney general stated that “all of the opinions of this Office approving a refund under the statute have done so solely for mistake or inadvertent error.” Id.

The probate court-did not err in its judgment denying HealthSouth relief under § 40-10-160, Ala.Code 1975. We cannot conclude that the legislature intended § 40-10-160, Ala.Code 1975, to allow a refund of-taxes paid on fictitious items intentionally listed on a tax return in furtherance of a fraudulent scheme to inflate earnings.

II.

HealthSouth next contends that it is entitled to a refund of the taxes it paid on the fictitious assets it intentionally listed on its tax returns because, it claims, the assessment of taxes on those nonexistent items of personal property was void and illegal under Alabama law.

HealthSouth relies heavily on City of Birmingham v. Piggly Wiggly Alabama Distributing Co., 638 So.2d 759 (Ala.1994), to support the contention that taxes assessed on the fictitious items of personal property are void and illegal under Alabama law. Although Piggly Wiggly does set out the definition of an illegal assessment, the facts of that case are distinguishable from the facts in- this case. In Piggly Wiggly, Piggly Wiggly Alabama Distributing Co. (“Piggly Wiggly Distributing”) mistakenly filed its business-license returns under Schedule 165 of the License Code of the City of Birmingham and paid $400,098.in fees. However, if Piggly Wiggly Distributing had filed under the correct schedules, Schedules 249 and 250 of the License Code, it would have paid only $2,800 in fees. Piggly Wiggly Distributing sought a refund from the City of Birmingham, asserting that because of a mistake of law or fact, it had been erroneously classified under Schedule 165. The City refused to issue a refund, and Piggly Wiggly Distributing sued for and was awarded a refund. In affirming the circuit court’s judgment, the Alabama Supreme Court noted that the word “illegal” had been “defined generally as ‘[ajgainst or not authorized by law,”’ that “[njothing in § 40-10-164 [led] th[at] Court to believe that the Legislature intended anything other than the ordinary meaning of th[at] word,” and that “under § 40-10-164 a taxpayer has a right to obtain a refund of an illegally assessed license tax from a municipality, even though the payment was voluntary.” 638 So.2d at 765 (quoting Black’s Law Dictionary 747 (6th ed.1990)). The Alabama Supreme Court concluded that the payment of the license fee by Piggly Wiggly Distributing under Schedule 165 was unauthorized and, therefore, illegal because Schedules 249 and 250 provided that they were the sole applicable and governing provisions of the License Code for a cooperative-grocers association, such as Piggly Wiggly Distributing. The fees that Piggly Wiggly Distributing sought to have refunded were paid as a result of unauthorized assessments. It is clear that the basis of the Court’s ruling in Piggly Wiggly was based on a bona fide mistake, where Piggly Wiggly Distributing mistakenly paid fees under the wrong schedule in the License Code, and not an intentionally false tax return.

Furthermore, this case differs from Piggly Wiggly in that in this case the tax assessor was authorized to assess taxes on the assets HealthSouth listed on its tax returns. The Code establishes the procedure for assessing and collecting taxes on personal property and sets out the duties and responsibilities of the taxpayer and the tax assessor. Section 40-7-l(a), Ala.Code 1975, provides that “[t]he tax assessor ... in each of the several counties shall have the right and authority to assess ... all personal property to the party last assessing the same, or to the owner of record.... ” Section 40-7-20, Ala.Code 1975, requires a taxpayer to submit tax returns that include a “full, true, and distinct statement of all ... personal property ” (emphasis added), and § 40-7-14 requires a taxpayer to provide the “estimated value of every item of personal property listed.” Section 40-7-21(a), Ala.Code 1975, provides that

“[i]t shall be a Class C misdemeanor for any taxpayer, or attorney or agent of any taxpayer having authority to make tax returns, to fail, neglect, or refuse on demand of the tax assessor, county revenue commissioner, or other assessing official, to fill out or have filled out the schedule or list herein provided for, or to fail to give the information herein provided for, or to fail, refuse, or neglect, to take and subscribe to the oath or affirmation required to such schedules or fail to return the same to the assessing official as prescribed by law.”

Section 40-7-27, Ala.Code 1975, provides that

“[w]hen the assessor shall have completed his work of assessing, valuing, and equalizing property which has been listed for taxation in his county, and such valuation shall have been entered on the assessments lists, ... he shall certify over his signature to the correctness of his returns, showing valuations fixed by him, and he shall at once notify the Department of Revenue by certified or registered mail that he has completed his assessment, valuation, and equalization work and that the tax returns are ready for the review and inspection as provided for in this title.”

Section 40-7-34, Ala.Code 1975, provides that “[a]fter the book of assessments has been completed as provided in this title, the Department of Revenue or the agent or assistant thereof shall certify on the book of assessments that the same has been examined and corrected by him,” specifying the total amount of several types of taxes and that “such certificate is to be the warrant to the tax collector of the county to proceed to collect such taxes in the manner directed by law.”

HealthSouth had a duty to provide the tax assessor with tax returns that included a full, true, and distinct statement of all the personal property it owned along with an estimated value of every item. The legislature made the failure to conform with this duty a class C misdemeanor for a reason. The heightened importance stems from the fact that the tax assessor depends on the taxpayer to provide a true and accurate list of property from which the tax assessor affixes values for assessment purposes. The tax assessor was authorized to assess the taxes based on the lists provided by HealthSouth. See §§ 40-7-1, 40-7-27, and 40-7-34, Ala.Code 1975. HealthSouth’s violation of its duty to provide correct and truthful information on its tax returns did not abrogate the tax assessor’s authority to affix values for assessment purposes to the property listed on HealthSouth’s tax returns.

Moreover, in Alamo National Bank of San Antonio v. Commissioner of Internal Revenue, 95 F.2d 622, 623 (5th Cir.1938), the United States Court of Appeals for the Fifth Circuit stated:

“Taxation is a matter of statutes, and equitable considerations cannot override the provisions of the statutes, nor always supply their omissions. McEachern v. Rose, 302 U.S. 56, 58 S.Ct. 84, 82 L.Ed. [46 (1937)]. Nevertheless honesty, good faith, and consistency are due in tax accounting. The right and wrong of things and equitable principles have a place in tax matters. Stearns Co. v. United States, 291 U.S. 54, 54 S. Ct. 325, 78 L.Ed. 647 [(1934)]; Stone v. White, 301 U.S. 532, 57 S.Ct. 851, 81 L.Ed. 1265 [(1937)].”

95 F.2d at 622-23. Alabama courts have also indicated that equitable principles have a place in tax matters. See Sims v. White, 522 So.2d 239, 240 (Ala.1988), Grant v. State, 667 So.2d 1369, 1372 (Ala.Civ.App.1994), and Town of Camp Hill v. James, 686 So.2d 1208, 1211 (Ala.Civ.App.1996).

HealthSouth cannot intentionally provide the tax assessor with misleading information in furtherance of a fraudulent scheme, allow the tax assessor to depend on this information in making the assessment, let the assessment stand while it benefits from the fraudulent scheme, and then change its position and request a refund of the taxes when the fraud is discovered and is no longer profitable. See Henderson v. Simmons, 234 Ala. 329, 332, 174 So. 491, 492 (1937) (stating that “one who has assessed property for taxation, and permits the assessment to stand, is estopped from denying liability for the taxes then assessed”).

III.

HealthSouth finally contends that, pursuant to § 40-7-9.1, Ala.Code 1975, it is entitled to a refund of the taxes paid for the 2001 and 2002 tax years because, it argues, the tax assessor allowed an adjustment of the taxes paid for 2003 that were part of the same fraudulent scheme. Specifically, HealthSouth argues that the tax assessor should not be allowed to engage in this type of disparate treatment.

As stated above, HealthSouth’s 2001, 2002, and 2003 tax returns included fictitious assets along with fabricated values for those assets. The tax assessor provided HealthSouth with an adjustment with respect to HealthSouth’s 2003 assessment. After HealthSouth requested a refund of taxes paid for the 2001 and 2002 tax years, the tax assessor requested an opinion from the attorney general on the matter, and the attorney general determined that HealthSouth was not entitled to a refund. Based on that opinion, the tax assessor denied HealthSouth’s refund petitions for the 2001 and 2002 tax years.

In essence, HealthSouth requested the probate court to invoke its equity jurisdiction to grant the refund petitions. A party seeking equitable relief, however, must have acted with equity and must come into court with clean hands. Levine v. Levine, 262 Ala. 491, 494, 80 So.2d 235, 237 (1955). In J & M Bail Bonding Co. v. Hayes, 748 So.2d 198 (Ala.1999), the Alabama Supreme Court stated:

“The purpose of the clean hands doctrine is to prevent a party from asserting his, her, or its rights under the law when that party’s own wrongful conduct renders the assertion of such legal rights ‘contrary to equity and good conscience.’ Draughon v. General Fin. Credit Corp., 362 So.2d 880, 884 (Ala.1978). The application of the clean hands doctrine is a matter within the sound discretion of the trial court. Lowe v. Lowe, 466 So.2d 969 (Ala.Civ.App.1985).”

748 So.2d at 199. HealthSouth cannot be permitted to take advantage of its own wrong by receiving a refund based on its own inequitable conduct. There is no equity in allowing HealthSouth to obtain relief from its own fraudulent scheme.

Conclusion

We agree with the probate court that the relief sought by HealthSouth is not authorized under state law. The tax system cannot be used as a tool to further a fraudulent scheme for private personal gain.

Based on the above, we affirm the judgment of the probate court.

AFFIRMED.

THOMPSON and MURDOCK, JJ., concur.

PITTMAN and BRYAN, JJ., concur in the result, without writing.

      . The tax returns were signed by an agent of HealthSouth and contained the following oath: "I hereby affirm that to the best of my knowledge and belief this listing including any accompanying statements, schedules, and other information is true and complete.”

      . HealthSouth assumes for purposes of this appeal that the reduction in the amount of the taxes owed for 2003 was an adjustment and not a refund.

      . HealthSouth also relies on Harlan v. United States, 160 Ct.Cl. 209, 312 F.2d 402 (1963), a case from the United States Court of Claims; however, that case is distinguishable. In Harlan, the receiver for an Indiana corporate taxpayer filed claims for a refund of the taxes the receiver claimed the corporate taxpayer had overpaid in 1949 and 1950 on the theory that the corporate taxpayer had overstated its income and had overpaid its taxes to permit former management to retain control of the corporation. The court allowed that receiver to utilize any loss in 1950 as a carryback to 1949 to increase recovery for that year. Rules of Court of Claims, Rule 38(c), 28 U.S.C. Harlan did not concern a refund of ad valorem property taxes based on mistake or error of law or an illegal assessment.

      . In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir.1981)(en banc), the Eleventh Circuit Court of Appeals adopted as binding precedent all of the decisions of the former Fifth Circuit Court of Appeals entered before October 1, 1981.


author: LYONS, Justice. SEE, Justice PARKER, Justice

text:
    Ex parte HEALTHSOUTH CORPORATION. (In re HealthSouth Corporation v. Jefferson County Tax Assessor, Dan Weinrib, and Jefferson County Tax Collector, J.T. Smallwood).
    1060296.
    Supreme Court of Alabama.
    Aug. 24, 2007.

      Joseph B. Mays, Jr., Bruce P. Ely, and Marc James Ayers of Bradley Arant Rose & White, LLP, Birmingham, for petitioner.
    Charles S. Wagner, asst, county atty., Birmingham, for respondents.
    Troy King, atty. gen., Kevin Newsom, deputy atty. gen., and G. Ward Beeson III, asst. atty. gen., for amicus curiae State of Alabama, in support of the respondents.
   On Application for Rehearing

LYONS, Justice.

The opinion of May 4, 2007, is withdrawn, and the following is substituted therefor.

HealthSouth Corporation appealed to the Court of Civil Appeals from a judgment of the Jefferson Probate Court in favor of Dan Weinrib, the Jefferson County tax assessor, and J.T. Smallwood, the Jefferson County tax collector (“the taxing authorities”). The Court of Civil Appeals affirmed the judgment of the probate court. HealthSouth Corp. v. Jefferson County Tax Assessor, 978 So.2d 737 (Ala.Civ.App.2006). HealthSouth then petitioned this Court for a writ of certiorari, and we granted HealthSouth’s petition to review two issues presented by this case. We affirm the judgment of the Court of Civil Appeals.

I. Factual Background and Procedural History

For the tax years 2001, 2002, and 2003, HealthSouth submitted personal-property tax returns to the Jefferson County tax assessor on which it intentionally listed numerous fictitious items of personal property and assigned fabricated values to those items. HealthSouth paid taxes for the years 2001 and 2002 based on the submitted returns. Before paying the amount due for 2003, however, Health-South amended its tax return for that year to remove the fictitious assets. The Jefferson County tax assessor allowed the adjustment as to 2003. HealthSouth then amended its 2001 and 2002 returns and filed petitions for a refund of the portion of ad valorem personal-property taxes it claims it overpaid as a result of listing the fictitious items of personal property on its tax returns for 2001 and 2002. The Jefferson County tax collector requested an opinion from the attorney general, who determined that no refund was due. The tax collector then denied the petitions for a refund of the taxes HealthSouth had paid for 2001 and 2002 on the fictitious property.

HealthSouth filed an action in the Jefferson Probate Court challenging the tax collector’s refusal to grant its petitions for the refund of ad valorem taxes paid on personal property for the years 2001 and 2002. When the probate court denied the petitions for refund, HealthSouth appealed to the Court of Civil Appeals. That court affirmed the judgment of the probate court. The Court of Civil Appeals held that § 40-10-160, Ala.Code 1975, providing for tax refunds based upon a mistake or an error, did not permit a refund when the taxpayer’s overpayment resulted from the taxpayer’s intentionally false statements as to the value of nonexistent assets. The Court of Civil Appeals further held that “HealthSouth’s violation of its duty to provide correct and truthful information on its tax returns did not abrogate the tax assessor’s authority to affix values for assessment purposes to the property listed on HealthSouth’s tax returns.” 978 So.2d at 744. This Court granted certiora-ri to consider two questions of first impression: whether the term “error” has a meaning different from the term “mistake,” specifically whether the former term is broad enough to encompass intentional dishonest conduct; and whether an intentional misrepresentation by a taxpayer in reporting property on a tax return can create a right in the taxing authorities to collect and retain taxes on nonexistent property so that no refund of taxes collected because of such an error can be had under § 40-10-160, Ala.Code 1975.

II. Standard, of Review

“In reviewing a decision of the Court of Civil Appeals on a petition for a writ of certiorari, this Court ‘accords no presumption of correctness to the legal conclusions of the intermediate appellate court. Therefore, we must apply de novo the standard of review that was applicable in the Court of Civil Appeals.’ Ex parte Toyota Motor Corp., 684 So.2d 132, 135 (Ala.1996). Because the material facts before the Court of Civil Appeals were undisputed, that court’s review of the trial court’s ruling would be de novo as well. State Dep’t of Revenue v. Robertson, 733 So.2d 397, 399 (Ala.Civ.App.1998). This is particularly true where the intermediate appellate court is construing statutory provisions. Robertson, supra; Pilgrim v, Gregory, 594 So.2d 114, 120 (Ala.Civ.App.1991).”

Ex parte Exxon Mobil Corp., 926 So.2d 303, 308 (Ala.2005).

III. Analysis

A. Whether “Error” Has a Meaning Dif- ■ ferentfrom “Mistake”

Section 40-10-160 provides:

“Any taxpayer who through any mistake, or by reason of any double assessment, or by any error in the assessment or collection of taxes, or other error, has paid taxes that were not due upon the property of such taxpayer shall be entitled, upon making proof of such payment to the satisfaction of the Comptroller, to have such taxes refunded to him if application shall be made therefor, as hereinafter provided, within two years from the date of such payment.”

(Emphasis added.)

This Court’s decision to grant HealthSouth’s petition for the writ of cer-tiorari was, triggered by the pivotal issue of the significance-, if any, of the legislature’s choice of two words — “error” and “mistake” — in its refund statute and its linking those words with the disjunctive conjunction “or.” The parties have wrestled mightily with parsed definitions from various sources that might afford a separate field of operation for each term. Of course, HealthSouth contends that “error” can embrace an intentional act and therefore that its fraudulent inclusion on its personal-property tax returns of assets that did not exist constitutes the type of activity for which it is entitled to relief pursuant to § 40-10-160 in the form of a refund of taxes paid. HealthSouth does not contend that “mistake” embraces its activities. The taxing authorities, on the other hand, argue that neither “error” nor “mistake” includes deliberate, intentional acts of the character committed by Health-South.

The Court of Civil Appeals, after citing definitions for each word, concluded:

“Although HealthSouth may be correct that the plain meaning of the word ‘mistake’ is slightly different from the plain meaning of the word ‘error,’ we are clear to the conclusion that an intentional misrepresentation is not included in the plain meaning of either word.”

978 So.2d at 741. ’

We conclude that the.Court of Civil Appeals was correct. While nuanced definitions of the two words could considerably lengthen this opinion, there is ample authority for the proposition that neither “error” nor “mistake” contemplates dishonest activity. This Court considered the significance of a legislative choice of “clerical error” and “other mistake of the clerk” in Ford v. Tinchant & Brother, 49 Ala. 567, 571 (1873). Although the Ford Court concluded that each of the terms had a separate field of operation, a limitation in its holding is significant to the issue in this case. This Court in Ford stated:

“The legislature cannot be held to have been so careless of language, as to have used the expressions ‘clerical error,’ and ‘other mistake of the clerk,’ in exactly synonymous sense, in view of the liability to mistake in the entries and record of causes; or to have excluded from amendment the manifest oversights and inaccuracies of the counsel, not calculated to mislead, in permitting the correction of ‘any error in fact in the process.’ ”

(Emphasis added.) Thus, in Ford this Court qualified the field of operation of “clerical error” and “other mistake of the clerk” by embracing only conduct that was “not calculated to mislead.”

In Alabama & Georgia Lumber Co. v. Tisdale, 139 Ala. 250, 36 So. 618 (1903), the amount of the judgment enforcing a mechanic’s lien was less than the amount that had previously been claimed in the statement of lien filed in the office of judge of probate. The validity of the lien was challenged on the basis of the discrepancy. The applicable statute provided: “[N]o error in the amount of the demand or in the name of the owner or proprietor shall affect the lien.... ” 139 Ala. at 255, 36 So. at 619. The Court observed:

“Fraud is never presumed. On the facts found, the discrepancy can and should be accounted for on the ground of a mistake or error ....
“... Whether the present statute was intended to prevent a destruction of the lien when the amount in the statement was intentionally made excessive in order to secure to the lienor a fraudulent advantage, we will not decide. But where, as here, no fraudulent purpose or intent is found to exist, we are clearly of [the] opinion that the lien is not impaired or destroyed by the error as to the amount.”

139 Ala. at 256-57, 36 So. at 620. Later, in Fleming v. McDade, 207 Ala. 650, 651, 93 So. 618, 619 (1922), this Court was required to resolve the question left unanswered in Alabama & Georgia Lumber Co. This Court stated:

“In Ala. & Ga. Lbr. Co. v. Tisdale, 139 Ala. 250, 257, 36 South. 618 [(1903)], there is to be found a query whether the present statute [providing for protection from destruction of the lien for error in the amount of the demand] was intended to prevent the destruction of the lien, as held in Lane & Bodley Co. v. Jones, [79 Ala. 156 (1885), holding that a fraudulent statement vitiated the lien] under the statute then in force, as to which no opinion was expressed. We are clearly of the opinion, however, that the principle announced in the older case has been in no wise affected by the provision of the present statute that ‘no error in the amount of the demand, ... shall affect the lien’; for this means merely an inadvertent or honest mistake, and not a willfully false claim.”

In Scheuer v. Berringer, 102 Ala. 216, 14 So. 640 (1894), dealing with error or mistake, on the one hand, or fraud, on the other, in settlements of accounts between partners, this Court recognized differing relief available attending each circumstance. This Court quoted with approval the trial court’s order, which in turn quoted Cowan v. Jones, 27 Ala. 317, 325 (1855), in which this Court stated, “ ‘ “The rule is settled that, where errors or mistakes only are shown, the account will not be opened, as where fraud is shown; but the party alleging error or mistake in the account, will be permitted to surcharge and falsify it.” ’ ” 102 Ala. at 220, 14 So. at 642. The trial court’s order continued:

“ ‘In Moses [Bros.] v. Noble[’s Adm’r], 86 Ala. 407, [410, 5 So. 181, 182 (1888),] Justice Clopton remarks: “In the absence of allegation and proof of fraud or undue influence, which taints the entire account, the court will not open and unravel as if no account had been made.... When only errors or mistakes are made, alleged, and proved, wrong charges which should be deducted, or omission of credit which should be allowed, the court will give the party complaining permission to surcharge and falsify the account, and limits its authority to a correction of the errors or mistakes.” ’ ”

102 Ala. at 220, 14 So. at 642. Scheuer was followed in Burks v. Parker, 192 Ala. 250, 68 So. 271 (1915).

In the context of acts of a municipality, this Court has limited error or mistake to honest activity:

“Bad faith is synonymous with fraud. 6 C.J. pp. 880, 881; Morton & Bliss v. [New Orleans & Selma] Railway Co., 79 Ala. 590, 617 [ (1885) ]. Error or mistake of judgment, in the exercise of a discretionary power, is not the equivalent of bad faith or fraud. In such circumstances, error or mistake of judgment consists with honest intention, or freedom from unworthy or unlawful motive or design.”

Pilcher v. City of Dothan, 207 Ala. 421, 424, 93 So. 16, 19 (1922) (emphasis added).

HealthSouth accuses the Court of Civil Appeals of rewriting § 40-10-160 by refusing to permit the modifier “any,” used in the statute to modify both error and mistake, to have a field of operation. But adopting HealthSouth’s view requires us to expand the commonly understood and long-settled scope of the terms “error” or “mistake,” contrary to this Court’s treatment of those terms over the years. Indeed, in Fleming v. McDade, the statute in question used an equally broad adjective in providing that “no error in the amount of the demand ... shall affect the lien.” 207 Ala. at 651, 93 So. at 619 (emphasis added). As previously noted, this Court did not permit such language, contrary to common usage, to sweep so broadly as to protect a party from the destruction of its lien by reason of its fraudulent statement of amount.

We are not led to a different conclusion by reason of a recent opinion of a Georgia trial court recognizing HealthSouth’s right to a refund pursuant to a Georgia statute. Section 48-5-380(a), Ga.Code Ann., provides:

“Each county and municipality may refund to taxpayers any and all taxes and license fees which are determined to have been erroneously or illegally assessed and collected from the taxpayers under the laws of this state or under the resolutions or ordinances of any county or municipality or which are determined to have been voluntarily or involuntarily overpaid by the taxpayers.”

(Emphasis added.) In Marconi Avionics, Inc. v. DeKalb County, 165 Ga.App. 628, 630, 302 S.E.2d 384, 385-86 (1983), relied upon by the Georgia trial court, the Georgia Court of Appeals stated: “We interpret the refund statute according to its literal and logical meaning: it applies to all property ‘erroneously or illegally assessed’ and taxes ‘voluntarily or 'involuntarily overpaid,’ for whatever reason.” Section 40-10-160 is materially different from the Georgia statute.

Finally, we note that HealthSouth contends that the Court of Civil Appeals has disregarded the rule of construction of statutes that presumes every word has some purpose and that no superfluous provisions are used. See Ex parte Panell, 756 So.2d 862, 867 (Ala.1999). Our determination that the words “error” and “mistake” are 'not consistent with dishonest acts, regardless of whatever else they might mean, obviates the necessity for determining the applicability of this presumption. Nevertheless, we note that this Court, as well as other jurisdictions, hás recognized that that presumption can be overcome by a determination that the legislature has used synonyms. See Anderson v. Hooks, 9 Ala. 704, 709-10 (1846), discussing the significance of a phrase in the Statute of Frauds referring to “the intent or purpose” and concluding:

“The introduction of the term ‘purpose’ into the act, does not impart to it any additional potency; It is only the synonym for design, intention, aim — is but a mere expletive, intended to convey the idea which the legislature had in view more strikingly, and might be- stricken from the act without affecting its interpretation in any manner.”

Likewise, in Caldwell v. State, 32 Ala.App. 228, 230, 23 So.2d 876, 878 (1945), the Court of Appeals held that “[t]he words ‘oppose’ and ‘resist’ as they appear in the [Code] section are synonymous.”

“It seems clear that the terms ‘oppose’ and ‘resist’, as they are used in the statute under consideration, convey a legislative intent to protect the officer against obstruction and interference and therefore contemplate the use of either actual or constructive force against the officer who is making an effort to serve or execute the legal writ or process. In other words, it is not made a criminal offense to hinder or interrupt or circumvent the service of the process with which the officer is armed, unless in doing so actual or constructive force is used against the officer himself.”

32 Ala.App. at 230—31, 23 So.2d at 878.

Such observations about a legislature’s capacity to employ synonyms were summarized in Hawaiian Airlines, Inc. v. Norris, 512 U.S. 246, 253, 114 S.Ct. 2239, 129 L.Ed.2d 203 (1994), in which the United States Supreme Court noted the existence of cases recognizing the use of synonyms in statutes, by referring to United States v. Olano, 507 U.S. 725, 732, 113 S.Ct. 1770, 123 L.Ed.2d 508 (1993), which it described as “reading ‘error or defect’ to create one category of ‘error.’ ” The Court then noted that Olano cited McNally v. United States, 483 U.S. 350, 358-59, 107 S.Ct. 2875, 97 L.Ed.2d 292 (1987), which the Court described as holding that the “second phrase in [the] disjunctive [was] added simply to make the meaning of the first phrase ‘unmistakable.’ ” In McNally, the Court stated: “As we see it, adding the second phrase simply made it unmistakable that the statute reached false promises and misrepresentations as to the future as well as other frauds involving money or property.” 483 U.S. at 359, 107 S.Ct. 2875. See also Southwick v. State, 126 Ark. 188, 190, 189 S.W. 843, 844 (1916) (“The use of the disjunctive ‘or’ between the words ‘intimidation’ and ‘threats’ in the statute was not in the sense of indicating that they are two different things, but was only used as an alias to designate the same thing by different words.”); and Smith v. R.F. Brodegaard & Co., 77 Ga.App. 661, 663-64, 49 S.E.2d 500, 502 (1948):

“We do not think the words ‘possession, custody, or control,’ as used in the statute providing for bail in actions for personalty, mean three different things; or that they state three different situations or grounds on which a plaintiff in trover can require a bond of the defendant. They express an alternative of terms, definitions or explanations of the same thing in different words. They mean substantially the same thing, i.e. that the property is within the power and dominion of the defendant. ... ‘The word “or,” when used not to connect two distinct facts of different natures, but to characterize and include two or more phases of the same fact, attended with the same result, states but a single ground, and not the alternative.’ 46 C.J., 1125(4). This rule of construction has been recognized and applied by our courts in criminal cases and in civil cases.”

See also Lewis v. Superior Court, 217 Cal.App.3d 379, 397, 265 Cal.Rptr. 855, 865 (1990) (“Although we endeavor to give effect to every word in a statute, sometimes terms used together are simply synonymous.”). Finally, see United States v. Patterson, 55 F. 605, 639 (C.C.D.Mass.1893):

“The court is well aware of the general rule which has been several times (twice certainly) laid down by the supreme court of the United States, that in construing a statute every word must have its effect, and the consequent presumption that the statute does not use two different words for the same purpose; but this rule has its limitations, and it is a constant practice for the legislature to use synonyms. A word is used which it is thought does not perhaps quite convey the idea which the legislature intends, and it takes another word, which perhaps has to some a little different meaning, without intending to more than make strong the purpose of the expression in the statute.”

Even if the terms “error” or “mistake” are synonymous, resort to synonyms for clarity or emphasis is clearly within the prerogative of the legislature.

B. Whether a Taxing Authority Has the Right to Assess and' Collect Taxes on the Basis of an Intentional Misrepresentation by the Taxpayer

HealthSouth also argues that even though it intentionally misrepresented assets on its personal-property tax returns, because those assets did not actually exist, the taxing authorities did not have the right to assess and collect personal-property taxes on the assets listed on the tax returns. As to this issue, we affirm the judgment of the Court of Civil Appeals for the reasons set forth in Part II of its opinion of October 27, 2006. The Court of Civil Appeals stated:

“In essence, HealthSouth requested the probate court to invoke its equity jurisdiction to grant the refund petitions. A party seeking equitable relief, however, must have acted with equity and must come into court with clean hands. Levine v. Levine, 262 Ala. 491, 494, 80 So.2d 235, 237 (1955). In J & M Bail Bonding Co. v. Hayes, 748 So.2d 198 (Ala.1999), the Alabama Supreme Court stated:
“ ‘The purpose of the clean hands doctrine is to prevent a party from asserting his, her, or its rights under the law when that party’s own wrongful conduct renders the assertion of such legal rights “contrary to equity and good conscience.” Draughon v. General Fin. Credit Corp., 362 So.2d 880, 884 (Ala.1978). The application of the clean hands doctrine is a matter within the sound discretion of the trial court. Lowe v. Lowe, 466 So.2d 969 (Ala.Civ.App.1985).’
748 So.2d at 199. HealthSouth cannot be permitted to take advantage of its own wrong by receiving a refund based on its own inequitable conduct. There is no equity in allowing HealthSouth to obtain relief from its own fraudulent scheme.”

978 So.2d at 745.

Justice Parker’s dissent states: “Such refunds [for overpayment of taxes] are appropriate regardless of the malfeasance of the person seeking the refund. This was noted by Craig M. Boise in Playing with ‘Monopoly Money’: Phony Profits, Fraud Penalties and Equity, 90 Minn. L.Rev. 144, 147-48 (2005), which examines recent incidents of falsely inflated income of major U.S. corporations.” 978 So.2d at 758.

The law review article cited by Justice Parker in fact supports the completely opposite view that equitable defenses should be available in actions seeking a tax refund after the taxpayer’s fraud in overstating its tax liability has been exposed. The article states:

“Recognizing that companies that inflate their taxable income make the IRS ‘an unwitting accomplice to ... fraud,’ the Senate, in May 2008, approved a measure that would have increased the penalty for tax fraud to an amount equal to the overpayment of tax attributable to the fraud. The effect of this provision would have been to disallow any refunds of taxes paid on fraudulently inflated income. Unfortunately, the measure was dropped in the conference committee and did not become part of the American Jobs Creation Act of 200k ultimately signed by President George W. Bush in October 2004. However, this Article suggests that the IRS may be able to achieve the results intended by the omitted Senate provision through the rules of equity. Moreover, equity may well furnish a more sound approach to penalizing offenders in such cases than would a legislative enactment.
“Central to the thesis of this Article is the fact that tax-refund suits are in essence claims in equity, a proposition that has two important implications. First, the taxpayer filing a tax-refund suit is asking the court to impose a fair, just, and equitable ‘remedy’ — namely, the refund of taxes paid in excess of what was due. As an equity claimant, the taxpayer is not in a position to demand that the refund be granted. Second, the fact that refund suits are actions in equity means that claimants are subject to well-established equitable defenses like the doctrine of unclean hands. Based on these twin propositions, this Article asserts that the IRS not only may, but should, assert equitable defenses to deny refunds of taxes paid on fraudulently inflated earnings.”

90 Minn. L.Rev. at 150-51 (emphasis added) (footnotes omitted).

The dissenting opinion also relies on the views of three staff reporters of The Wall Street Journal. The dissent states:

“A Wall Street Journal article noted the same principle: ‘[f]raud or not, the current tax code makes no distinctions. It is a basic tenet of tax law — both for individuals and corporations — that those who overpay are entitled to a refund.’ Rebecca Blumenstein, Dennis K. Ber-man, and Evan Perez, After Inflating Their Income, Companies Want IRS Refunds, The Wall Street Journal, May 3, 2003, at Al.”

978 So.2d at 758.

We are more impressed with the holding in Stone v. White, 301 U.S. 532, 535, 57 S.Ct. 851, 81 L.Ed. 1265 (1937):

“The statutes authorizing tax refunds and suits for their recovery are predicated upon the same equitable principles that underlie an action in assumpsit for money had and received. United States v. Jefferson Electric [Mfg.] Co., 291 U.S. 386, 402 [ (1934) ]. Since, in this type of action, the plaintiff must recover by virtue of a right measured by equitable standards, it follows that it is open to the defendant to show any state of facts which, according to those standards, would deny the right, Moses v. Macferlan, supra, [2 Burr. 1005] at 1010 [ (K.B. 1750) ]; Myers v. Hurley Motor Co., 273 U.S. 18, 24, 50 A.L.R. 1181 [ (1927) ]; cf. Winchester v. Hackley, 2 Cranch 342 [ (1805) ], even without resort to the modern statutory authority for pleading equitable defenses in actions which are more strictly legal, Jud.Code, § 274b, 28 U.S.C. § 398.”

IV. Conclusion

The settled meaning of the terms “error” and “mistake” is not consistent with intentional dishonest acts. Furthermore, HealthSouth’s intentional misrepresentation of its assets did not abrogate the right of the taxing authorities to assess and collect personal-property taxes from HealthSouth based upon the information HealthSouth provided on its personal-property tax return. We therefore affirm the judgment of the Court of Civil Appeals.

APPLICATION OVERRULED; OPINION OF MAY 4, 2007, WITHDRAWN; OPINION SUBSTITUTED; AFFIRMED.

COBB, C.J., and WOODALL, STUART, and SMITH, JJ., concur.

SEE, J., concurs in the rationale in part and concurs in the result.

PARKER, J., concurs in part and dissents in part.

BOLIN and MURDOCK, JJ., recuse themselves.

SEE, Justice

(concurring in the rationale in part and concurring in the result).

I fully join in the holding of the main opinion. I agree that neither “mistake” nor “error” in this statute encompasses HealthSouth’s deliberate misrepresentations on its tax returns. I write specially only to note that I do not consider it necessary to determine whether the legislature could have intended to use the terms “error” and “mistake” as synonyms. Therefore, I do not join in that discussion.

PARKER, Justice

(concurring in part and dissenting in part).

I concur with the conclusion of the main opinion on the first issue — whether the term “error” differs from the term “mistake,” specifically, whether “error” is broad enough to encompass intentional conduct. However, I dissent from the adoption by the majority of the rationale of the Court of Civil Appeals’ opinion on the second issue — whether an intentional misrepresentation by a taxpayer in reporting property can create a right to collect and retain taxes on nonexistent property so that no refund of taxes collected due to such an error can be had under § 40-10-160, Ala.Code 1975.

The majority opinion, by affirming the judgment of the Court of Civil Appeals on this issue, effectually holds that the State has the authority to tax nonexistent property. The Court of Civil Appeals distinguished the present case from City of Birmingham, v. Piggly Wiggly Alabama Distributing Co., 638 So.2d 759, 765 (Ala.1994), in order to contradict Health-South’s contention that the tax assessor had no authority to assess nonexistent personal property to HealthSouth. The Court of Civil Appeals’ opinion notes that Piggly Wiggly involved a mistake, whereas the present case involves an intentional misrepresentation. ■ That opinion holds that in an instance of mistake, such as in Piggly Wiggly, the assessor is without authority to assess the property. But in this case, the Court of Civil Appeals held:

“The tax assessor was authorized to assess the taxes based on the lists provided by HealthSouth. HealthSouth’s violation of its duty to provide correct and truthful information on its tax returns did not abrogate the tax assessor’s authority to affix values for assessment purposes to the property listed on HealthSouth’s tax returns.”

978 So.2d at 744 (citation omitted). Although this mistake/intentional-misrepresentation distinction does distinguish Pig-gly Wiggly from this case, it is irrelevant. The forms an entity fills out may give the assessor authority to assess the value of the property listed; however, this presupposes there is property listed that has value to be assessed. Nonexistent property has no value, and without property to assess, the assessor is without authority.

The Court of Civil Appeals also suggested that equity has a place in tax matters. 978 So.2d at 744 (citing Sims v. White, 522 So.2d 239, 240 (Ala.1988)). However, equity may not prevent HealthSouth from receiving a refund, because it is illegal for the tax assessor to assess nonexistent property. “ ‘Illegal’ is defined generally as ‘[ajgainst or not authorized by law.’ ” Piggly Wiggly, 638 So.2d at 765 (quoting Black’s Law . Dictionary 747 (6th ed.1990)). Because the assessor has no authority to assess nonexistent property, it is illegal for the assessor to do so. There is no constitutional or statutory support for the proposition that the assessor is authorized to assess nonexistent property.

Constitutional and Statutory Construction

The Alabama Constitution of 1901, § 211, explicitly limits the State’s taxing authority:

“All taxes levied on property in this state shall be assessed in exact proportion to the value of such property....”

Nonexistent property has no value; therefore, nonexistent property may not be taxed. The “value of [nonexistent] property” is zero. Any “exact proportion” of zero is zero.

This Court has recognized the following three principles regarding the government’s power of taxation:

“(1) The power of taxation is an incident of sovereignty and is possessed by the government without being expressly conferred by the people.
“(2) The power is purely legislative.
“(3) So long as no constitutional limitations are exceeded, the Legislature is of supreme authority, and the courts, as well as all others, must obey.”

State v. Birmingham, So. Ry., 182 Ala. 475, 479, 62 So. 77, 79 (1913). This Court noted that “[t]he purpose and scope of this constitutional limitation ... is that it was designed to secure uniformity and equality by the enforcement of an ad valorem system of taxation and to prohibit arbitrary or capricious modes of taxation without regard to value.” 182 Ala. at 480-81, 62 So. at 79 (emphasis added). This Court further stated that “[i]f the legislative provision in question is unconstitutional, it must be because it is repugnant to one or more of the following sections of the state constitution: Section 211....” 182 Ala. at 479, 62 So. at 79.

The authority of the tax assessor is derived from the legislature through § 40-7-1, Ala.Code 1975, as shown below, and if that authority is to extend to nonexistent property, the statute would be unconstitutional because it would be repugnant to § 211, Ala. Const.1901. It is a well-settled principle of statutory construction that a statute should be construed to avoid conflict with the constitution. The Constitution of Alabama establishes the extent of the authority to tax property when it states: “All taxes levied on property in this state shall be assessed in exact proportion to the value of such property.” Ala. Const.1901, § 211. This section “pro-hibitfe] the Legislature from prescribing or declaring an arbitrary or artificial value of the property of individuals or corporations, and assessing taxes on such valuation.” Birmingham So. Ry., 182 Ala. at 481, 62 So. at 79 (citing Assessment Board v. A.C.R.R., 59 Ala. 551 (1877)). Section 211 prevents placing an “artificial value” on nonexistent property. Such a valuation would disregard the constitutional mandate that the tax is to be “in exact proportion to the value of’ the property. Nonexistent property has no value. Therefore, if the authority of the assessor, derived from § 40-7-1, is to be read to include nonexistent property, the statute conferring that authority would be repugnant to § 211 and, therefore, unconstitutional.

Taxation statutes are to be strictly construed against the taxing authority: “[W]e are here concerned with a taxing act, with regard to which the general rule requiring adherence to the letter applies with peculiar strictness.” Crooks v. Harrelson, 282 U.S. 55, 61, 51 S.Ct. 49, 75 L.Ed. 156 (1930). In United States v. Merriam, 263 U.S. 179, 187-88, 44 S.Ct. 69, 68 L.Ed. 240 (1923), the Supreme Court stated: “[I]n statutes levying taxes the literal meaning of the words employed is most important for such statutes are not to be extended by implication beyond the clear import of the language used.” “[I]f there is a serious doubt as to taxability, the doubt should be resolved in favor of the taxpayer.” Western Elec. Co. v. United States, 564 F.2d 53, 66, 215 Ct.Cl. 100, 124 (1977)(citing Allstate Ins. Co. v. United States, 530 F.2d 378, 209 Ct.Cl. 1 (1976); Ellis v. United States, 416 F.2d 894, 897 (6th Cir.1969); and McFeely v. Commissioner, 296 U.S. 102, 111, 56 S.Ct. 54, 80 L.Ed. 83 (1935)). “A basic rule of statutory construction is that ambiguous tax statutes are construed against the taxing authority and in favor of the taxpayer.” Birmingham v. AmSouth Bank, N.A., 591 So.2d 473, 477 (1991) (citing Alabama Farm Bureau Mut. Cas. Ins. Co. v. City of Hartselle, 460 So.2d 1219 (Ala.1984); Owen v. West Alabama Butane Co., 278 Ala. 406, 178 So.2d 636 (1965); and Miller v. Standard Nut Margarine Co., 284 U.S. 498, 52 S.Ct. 260, 76 L.Ed. 422 (1932)).

The Court of Civil Appeals concluded that the tax assessor was authorized to assess taxes on the assets HealthSouth listed on its tax returns. 978 So.2d at 743 (relying on § 40-7-l(a), § 40-7-27, and § 40-7-34). “HealthSouth’s violation of its duty to provide correct and truthful information on its tax returns did not abrogate the tax assessor’s authority to affix values for assessment purposes to the property listed on HealthSouth’s tax returns.” 978 So.2d at 744. Therefore, the Court of Civil Appeals concluded, it was not illegal to assess value on the nonexistent property, because the tax assessor had the authority to do so and that authority was not abrogated.

The Court of Civil Appeals misinterprets the statutes that give the tax assessor his authority. The only statute relevant to the issue of authority, because it is the only statute that addresses the issue of authority, is § 40-7-1, which provides: “The tax assessor ... shall have the right and authority to assess all ... personal property to the party last assessing the same, or to the owner of record.... ” That court concluded that because the statute gives authority to the assessor to “assess all personal property ... to the owner of record” and because HealthSouth included the nonexistent property on its returns, the statute gives the assessor authority over the nonexistent property. However, § 40-7-1 nowhere grants authority to the tax assessor to assess nonexistent property. The phrase “owner of record” allows the assessor to assess the property listed on the return, but this necessarily presumes that the property listed actually exists and has value. Even though it may be listed, nonexistent property has no owner — of record or otherwise — and no value capable of being assessed. Even if somehow we were to conclude that the assessor could assess fictitious property, no verifiable valuation criteria would exist by which to do so.

If doubt exists as to whether the State has constitutional or statutory authority to tax nonexistent property, we must return to the basic axiom of statutory interpretation set forth above: Taxation statutes are to be construed strictly in favor of the taxpayer and against the State.

Analogous Cases

Taxés are to be assessed in exact proportion to the value of the property taxed. Although it has been stated that this valuation may be a percentage of the actual value, see State v. Birmingham So. Ry., supra, and the valuation process is not always accurate, see Hamilton v. Adkins, 250 Ala. 557, 35 So.2d 183 (1948), if that proportionate value is overstated, in the case of nonexistent or exempt property, and the taxes collected are beyond those owed, then refunds have been allowed. “In Pacific Coast Co. v. Wells, 134 Cal. 471, [66 P. 657 (1901) ], the taxpayer inadvertently overstated the amount of his solvent credits, and the assessor adopted the erroneous figure as the basis of the assessment. The Supreme Court treated the tax there as based pro tanto on nonexistent property and held the taxpayer entitled to a refund.” Lockheed Aircraft Corp. v. County of Los Angeles, 207 Cal.App.2d 119, 126-27, 24 Cal.Rptr. 316, 321 (1962). In Lockheed, the court stated that the various refund decisions “reflect the view of the courts that where it can be established that an assessment is based upon property which is exempt, outside the jurisdiction, or nonexistent, the taxpayer is entitled to judicial relief.” 207 Cal.App.2d at 127, 24 Cal.Rptr. at 321. Therefore, an overpayment of tax should result in a tax refund.

Such refunds are appropriate regardless of the malfeasance of the person seeking the refund. This was noted by Craig M. Boise in Playing with “Monopoly Money’’: Phony Profits, Fraud Penalties and Equity, 90 Minn. L.Rev. 144, 147-48 (2005), which examines recent incidents of falsely inflated income of major U.S. corporations. A Wall Street Journal article noted the same principle: “[fjraud or not, the current tax code makes no distinctions. It is a basic tenet of tax law — both for individuals and corporations — that those who overpay are entitled to a refund.” Rebecca Blumenstein, Dennis K. Berman, and Evan Perez, After Inflating Their Income, Companies Want IRS Refunds, The Wall Street Journal, May 3, 2003, at Al. Additionally, many articles have reported that HealthSouth, Enron Corporation, and WorldCom are seeking tax refunds from the Internal Revenue Service (“the IRS”). See, e.g., Associated Press, Judge orders Scrushy to pay back millions in Health-South bonuses, Bradenton Herald, Jan. 5, 2006, which stated: “Combined with as much as $265 million in refunds the company is seeking from the federal government for taxes it paid on overstated income during the fraud, the court-ordered repayment could help shore up the finances of HealthSouth.”

Although taxpayers who fraudulently increase their income are entitled to a refund, we may have difficulty determining whether these taxpayers actually get a refund. The IRS requires confidentiality of federal income-tax returns. 26 U.S.C. § 6103. Nonetheless, some reports may come from the corporations themselves, as was the case for MCI, formerly World-Com. “MCI, formerly known as World-Com Inc., has already collected nearly $300 million in overpayments from the I.R.S., a company spokeswoman said. The telecommunications giant’s accounting irregularities total $11 billion.” Anitha Red-dy and Christopher Stern, Firms Want Refunds of Tax on Fake Profit; MCI Collects Almost $300 Million, The Washington Post, final ed. May 3, 2003, at El. The State of Alabama should not deny refunds on nonexistent property when the IRS provides refunds of taxes paid on nonexistent income.

Punitive Aspect Is Misdirected

The Court of Civil Appeals’ opinion concludes: “HealthSouth cannot be permitted to take advantage of its own wrong by receiving a refund based on its own inequitable conduct.” 978 So.2d at 745. Health-South is not seeking to “take advantage of its own wrong”; rather, HealthSouth is asking to be placed in the position it would be in if the property had been reported and assessed properly. In so doing, HealthSouth is attempting to right the wrong done to its shareholders by its former officers or agents.

Any effort to hold HealthSouth accountable for the fraud of its former officers should not overlook the fact that those who have suffered most as a result of HealthSouth’s wrongdoing are its innocent stockholders. HealthSouth’s former officers who were involved in the fraud have already, for the most part, borne the consequences of their actions. Penalizing HealthSouth further by retaining this tax would not be an act of reprimand, but a misplaced chastisement of the innocent shareholders, because withholding the tax refund would prevent the shareholders and creditors from using the tax refund to mitigate damages. As Boise says, “After all, the direct cost of any penalty generally will be borne by shareholders in addition to the potential indirect costs associated with the penalty.” Playing with “Monopoly Money,” 90 Minn. L.Rev. at 201. Retaining the excess tax does not deter future tax fraud, because those who perpetrated the fraud are not the persons who will suffer from the denial of the refund.

It is true that shareholders assume the risks of their investments. However, the State should not magnify the shareholders’ losses by refusing to refund illegal taxes on nonexistent property, especially when, as in this case, the fraud and misrepresentations were concealed from the shareholders.

Conclusion

I therefore dissent — not because I tolerate corporate fraud, but because I see the need to carefully limit the power of the State in the area of taxation. In McCulloch v. Maryland, 17 U.S. (4 Wheat.) 316, 391, 4 L.Ed. 579 (1819), Chief Justice John Marshall declared: “A right to tax, without limit or control, is essentially a power to destroy.” The power to tax nonexistent property adds to the power to destroy the power to redefine reality. This is a power that must not be ceded, even in the most egregious of circumstances.

      . As the Court of Civil Appeals noted, before 2002 several officials of HealthSouth were involved in a scheme to artificially inflate the company's reported earnings and, in further-anee of that scheme, overstated the corporation’s fixed assets. The inflated personal-property tax returns reflected the overstated assets.

      . The State of Alabama has intervened as an amicus curiae in support of the taxing authorities.

      . HealthSouth relies upon an unpublished opinion rendered by the Superior Court of Clayton County, Georgia, a copy of which HealthSouth provided to this Court. HealthSouth Holdings, Inc. v. Clayton County, Georgia, No.2005-CV-2056-7 (Clayton Superior Court, October 19, 2006).

      . The majority opinion quotes Stone v. White, 301 U.S. 532, 535, 57 S.Ct. 851, 81 L.Ed. 1265 (1937), as recognizing that federal tax " 'statutes authorizing tax refunds and suits for their recovery are predicated upon the same equitable principles that underlie an action in assumpsit for money had and received.’ ” 978 So.2d at 754. In Stone, where a trust had mistakenly paid the tax on money disbursed to a beneficiary when the beneficiary should have paid the tax, the trust sued to recoup the tax payment after the point in time when the Internal Revenue Service could have required the beneficiary to pay the tax. The Supreme Court recognized that equitable principles would apply to the government, as well as to the taxpayer: “Equitable conceptions of justice compel the conclusion that the retention of the tax money would not result in any unjust enrichment of the government.” 301 U.S. at 537, 57 S.Ct. 851. The Court found that although the tax-payment procedure had been erroneous, it had "resulted in no unjust enrichment to the government, and in no injury to petitioners or their beneficiary.” 301 U.S. at 539, 57 S.Ct. 851.
      Here, in contrast, the retention of the tax payment would result in unjust enrichment to the government and injury to the petitioner and its shareholders.
      Equity, however, has no place in our constitutional scheme limiting the authority of the tax assessor, explained infra. Moreover, court adoption of equity principles would empower the judiciary to exact penalties against taxpayers that the legislature has not enacted.

      . As noted in the majority opinion, the author of this article argues "that equitable defenses should be available in actions seeking a tax refund after the taxpayer’s fraud in overstating its tax liability has been exposed.” 978 So.2d at 753 (emphasis added). The author states that the position he argues "would establish a new precedent.” 90 Minn. L.Rev. at 201 ("The use of equitable defenses in denying a fraud-related refund claim in a case like WorldCom’s, for example, would establish a new precedent.”). In that portion of the article quoted in the majority opinion, the author argues that the Internal Revenue Service should use principles of equity to accomplish what Congress refused to do in 2004 — to authorize the Internal Revenue Service to retain the full amount of the overpayment in cases of fraudulent overpayments.
      As noted in note 4, supra, equity cannot be employed to expand the constitutionally limited authority of our tax assessors.