Key Points

  • The Alabama Court of Civil Appeals granted mandamus and directed the Jefferson Circuit Court to dismiss Envirocare's putative class action against Veseris and SiteOne for lack of subject-matter jurisdiction.
  • The court held that Envirocare's contract, tort, unjust-enrichment and fraud claims in substance seek a refund of sales taxes allegedly collected on exempt insecticide and fungicide purchases, so the TBOR governs them.
  • Because Envirocare had not completed the refund procedure in Ala. Code Section 40-2A-7(c), including a ruling on its petition and an appeal from any denial, the circuit court lacked jurisdiction.
  • The court acknowledged that no prior TBOR case addressed a consumer suing a seller directly, but held that the Supreme Court's precedents, including Patterson, City of Red Bay and Wilbert, apply equally to such suits.
  • The court did not decide whether Envirocare may bring a civil claim against the sellers if the Revenue Department denies its refund petition, calling that question not ripe.

The Alabama Court of Civil Appeals on Friday ordered a trial court to throw out a proposed class action accusing two pesticide suppliers of charging licensed pest-control companies sales tax on products the law exempts. The court held that buyers must pursue the state's tax-refund process before any court can hear the dispute.

The court unanimously granted a petition for a writ of mandamus filed by ES OpCo USA LLC, which does business as Veseris, and SiteOne Landscape Supply Inc. Presiding Judge Moore wrote the opinion, and Judges Edwards, Hanson, Fridy and Bowden concurred. The writ directs the Jefferson Circuit Court to vacate its July 20, 2026, order denying the suppliers' motions to dismiss and to dismiss the case for lack of subject-matter jurisdiction.

The ruling extends a line of Alabama Supreme Court decisions treating the Alabama Taxpayers' Bill of Rights and Uniform Revenue Procedures Act, known as the TBOR, as the only route to a tax refund. The court acknowledged that none of the cases construing the TBOR had addressed a consumer's complaint filed directly against a seller, and it held that the distinction made no difference.

Envirocare LLC, a licensed structural pest-control operator, filed the suit on Oct. 13, 2025, on behalf of itself and other licensed operators across Alabama. State law exempts from sales tax insecticides and fungicides used by properly permitted operators for "structural pest control work." Envirocare alleged that Veseris and SiteOne, both suppliers to pest-control companies, had for at least 10 years charged and collected sales tax from the class members on those purchases anyway.

According to the complaint, Envirocare demanded reimbursement. Veseris refused and offered limited credits or discounts on future purchases, and SiteOne did not respond. Envirocare sued for breach of contract or open account, breach of duty and wrongful collection of sales tax, negligence per se, and unjust enrichment, later adding a fraud count. The complaint also said Envirocare was "moving forward with seeking reimbursement for all of the sales tax" from the state through the Alabama Department of Revenue.

SiteOne moved to dismiss in February 2026, arguing that the TBOR supplied Envirocare's exclusive remedy, and Veseris joined the motion. The appeals court decided the case on jurisdiction alone and did not address whether the complaint stated a viable claim.

Under Alabama Code Section 40-23-26(d), Moore wrote, a seller that mistakenly collects tax on an exempt sale cannot keep the money and must send it to the Revenue Department. The consumer, not the seller, is "the party who suffers the loss," the opinion said.

The TBOR, enacted in 1992, lets a consumer petition the department for a refund, generally within two years of paying the tax. If the department denies the petition, the consumer may appeal to the Alabama Tax Tribunal or a circuit court within two years. The statute provides that a late appeal "shall be dismissed for lack of jurisdiction."

The opinion traced how the Alabama Supreme Court has applied that scheme. In Patterson v. Gladwin Corp., a 2002 franchise-tax refund class action against the revenue commissioner, the high court wrote that "The TBOR is jurisdictional on its face." In General Motors Acceptance Corp. v. City of Red Bay in 2004, it ordered dismissal of a city and county class action against GMAC over uncollected local taxes, even though sovereign immunity was not at issue. From those cases, Moore wrote, "a circuit court does not acquire subject-matter jurisdiction over a claim for a sales-tax refund unless and until the plaintiff has strictly complied with the refund procedures."

Applying that rule, the court looked past the labels on Envirocare's five counts. "Regardless of the form in which the complaint has been cast," Moore wrote, "Envirocare essentially seeks a sales-tax refund." The complaint itself alleged that Envirocare had filed or would file a refund petition with the department, "plainly indicating that it had not yet fully complied with the TBOR," the court wrote.

Envirocare had conceded that it must follow the TBOR to get a refund from the state, but argued that the statute should not bar a civil remedy against the suppliers. "Admittedly, none of the cases construing the TBOR have addressed the jurisdiction of a circuit court over a complaint filed by a consumer directly against a seller," Moore wrote. "However, we cannot discern any valid reason for failing to follow the law as enunciated by the supreme court based on that distinction."

The court relied on the high court's 2021 decision in Wilbert of Birmingham LLC v. Jefferson County, which recognized that the same jurisdictional principle binds taxpayers and taxing authorities. "The TBOR provides the remedy to a consumer seeking a refund of sales taxes improperly collected by a seller just as it provides a remedy to a taxing authority to collect sales taxes properly due from a seller," Moore wrote.

The court also rejected Envirocare's argument that the TBOR offered an inadequate remedy. Even if that were true, Moore wrote, it "does not affect the jurisdictional analysis." The opinion continued: "Envirocare must follow the TBOR as the exclusive means to obtain the sales-tax refund it is seeking, and, unless and until it does, the circuit court lacks subject-matter jurisdiction over the controversy."

The court left one question open. In a footnote, it declined to decide whether Envirocare could bring any civil claim against the suppliers if the Revenue Department denies its refund petition in whole or in part, calling that "a question not ripe for our review." The case now returns to the Jefferson Circuit Court, which must vacate its earlier order and dismiss the suit.