Koner v. Procaccino

Sweeny, J. These are proceedings pursuant to CPLE article 78 (transferred to the Appellate Division of the Supreme Court in the Third Judicial Department by orders of the Supreme Court at Special. Term, entered in Albany County) to review determinations of the State Tax Commission which sustained unincorporated business tax assessments imposed under article 23 of the Tax Law. Petitioners have each been assessed unincorporated business tax liability upon income derived from free-lance photography. Petitioner Peterson was primarily engaged in editorial fashion photography. This work involved the supplying of photographs to express opinions' concerning fashion. Koner was designated a photo-journalist. By his photographs he endeavored to relate a story as a writer might do with words. The works of both appeared in many of the so-called popular magazines. While petitioners have no business affiliation with one another, the legal issues in each proceeding are the same and this court has permitted joinder of their proceedings. The issue presented is one of law, as there are no factual disputes. Each petitioner maintains that he should be exempt from the tax assessment since he is a member of a profession within the purview of subdivision (c) of section 703 of the Tax Law, the pertinent parts of which provide as follows: “ (c) Professions.— The practice of law, medicine, dentistry or architecture, and the practice of any other profession in which capital is not a material income producing factor and in which more than eighty per centum of the * * * income * * * is derived from personal.services actually rendered by the individual * * * shall not be deemed an unincorporated business.” Concededly, two requisites of the section, i.e., that more than 80% of gross income was derived from personal services and that capital was not a material income producing factor, are not in dispute. The issue narrows to whether petitioners were engaged in a “ profession ” pursuant to the terms of the statute. The Tax Commission has determined that they were not, and we agree. The record reveals that both petitioners are skilled photographers, although neither has a college degree in photography. Koner, however, received some formal training in photography while in the armed services. On several occasions the appellate courts have considered the question of what constitutes a “ profession ” as specified in subdivision (c) of section 703 of the Tax Law. This court has recently set forth factors which should be taken into considera [553] tion in determining whether a certain activity constitutes a profession. (Matter of Rosenbloom v. State Tax Comm., 44 A D 2d 69.) In Matter of Wilson v. Bates (282 App. Div. 1099) a situation somewhat similar to the instant case was presented in which this court sustained the tax commission’s denial of ah exemption to a commercial artist who specialized in coloring photographs for advertising purposes. In a more recent case, Matter of White v. Murphy (11 A D 2d 854, affd. 9 N Y 2d 995), the tax commission’s denial of an exemption to a commercial artist who did illustrations for business advertising which appeared in magazines was also sustained. Primarily, we are concerned with the intent of the Legislature and, specifically, what was meant by the use of the words “ the practice of any other profession.” Several professions are enumerated in subdivision (c) of section 703, namely the practice of law, medicine, dentistry or architecture, and then follows the language, ‘ ‘ and the practice of any other profession.” These words must be read in conjunction with the professions listed under the rule of ejusdem generis (McKinney’s Cons. Laws of N. Y., Book 1, Statutes, § 239, subd. b). The words “ any other” which follow in line after an enumeration of things or classes are to be regarded as relating to similar things or classes, if the meaning intended is otherwise doubtful. (Matter of Bowen v. Allen, 17 A D 2d 12, 14, affd. 13 N Y 2d 663.) In our view, to be entitled to an exemption under this Statute, in addition to the factors listed in Rosenbloom, the services performed must involve something more than the type of services generally performed by those in the broader categories of a trade, business or occupation (cf. Tax Law, § 703, subd. [a]). The services must also encompass some of the essential characteristics of the preceding enumerated professions. (See Matter of Freeman, 34 N Y 2d 1, 7.) Petitioners, who are, no doubt, skillful artisans, with several years of training and experience, nonetheless, were engaged in the business of photographically illustrating magazine articles. They were not devoted to public service in the traditionally professional sense, but sold their services to nonprofessional businesses. We conclude, therefore, that their activities constituted the carrying on of a business, rather than the practice of a profession. On this record, they have not sustained the burden of establishing that they came, within the purview of the statute,: and, as expressed in Matter of Schmidt v. Bates (282 App. Div. 980), a professional exemption should not be extended to new categories. [554] We find no merit in petitioners’ other eontention that to exclude them from exemption violates the Fourteenth Amendment’s Equal Protection Clause. (Lehnhausen v. Lake Shore Auto Parts Co., 410 U. S. 356; Shapiro v. City of New York, 32 NY 2d 96.) The determinations should be confirmed, and petitions dismissed, without costs.