Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_06-cv-02528/USCOURTS-caed-2_06-cv-02528-4/pdf.json

Nature of Suit Code: 870
Nature of Suit: Tax Suits
Cause of Action: 26:7403 Suit to Enforce Federal Tax Lien

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

----oo0oo----

UNITED STATES OF AMERICA, 

 NO. CIV. 06-02528 WBS DAD

Plaintiff,

v. MEMORANDUM AND ORDER RE: MOTION FOR SUMMARY JUDGMENT

GERALD W. FILICE; URSULA FILICE,

EL DORADO COUNTY TAX COLLECTOR;

and STATE OF CALIFORNIA

FRANCHISE TAX BOARD, 

Defendants.

----oo0oo----

Based on the joint tax returns signed and filed by

defendants Gerald W. Filice and Ursula Filice (“defendants”) for

the tax years 1993 through 1997, a delegate of the Secretary of

Treasury made assessments against them for unpaid federal income

tax liabilities, penalties, and interest. (Pl.’s Stmt. of

Undisputed Facts ¶ 1.) As of November 21, 2007, the unpaid

federal taxes, assessed and accrued interest, and other statutory

additions totaled $ 350,259.86 (Id. ¶¶ 2, 5 (itemizing the

amounts owed); Beile Decl. Ex. 1.) On the dates of the

assessments, a federal tax lien attached to the defendants’

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1 Because defendants failed to oppose the United States’

motion for summary judgment, under Local Rule 78-230(c),

defendants are not entitled to be heard at oral argument in

opposition to the motion. The absence of an opposition does not,

however, independently justify granting the motion. Henry v.

Gill Indus., Inc., 983 F.2d 943, 949-50 (9th Cir. 1993). 

However, since defendants failed to oppose the United States’

factual assertions, the court is entitled to accept them as true. 

Gonsalves v. Conseco Ins. Co., No. 06-0058, 2007 WL 2898561, at

*2 (E.D. Cal. Sept. 28, 2007); see also Fitzgerald v. Henderson, 251 F.3d 345, 353 (2d Cir. 2001) (noting that because plaintiff

failed to oppose defendant’s motion for summary judgment, “the

only question that remains is whether summary judgment is

‘appropriate’; that is, whether [d]efendant’s evidentiary

material establish[es] an absence of a genuine issue of material

fact and that it is entitled to judgment as a matter of law”);

Gadsden v. Jones Lang Lasalle Ams., Inc., 210 F. Supp. 2d 430,

438 (S.D.N.Y. 2002) (accepting facts in movant’s Rule 56 papers

as true because non-movant’s opposition was rejected as

untimely).

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property, including their real property located at 4040 Rontree

Lane, Somerset, California, 95684 (“property”). (Id. ¶ 6;

Ashwell Decl. Ex. 13 (defendants’ Grant Deed to the property).) 

The Internal Revenue Service recorded a Notice of the Federal Tax

Lien in El Dorado County on September 27, 1999. (Ashwell Decl.

Ex. 14.) On November 13, 2006, the United States filed this

action to reduce to judgment the federal tax assessments for tax

years 1993 through 1997 and to foreclose on its tax lien against

the defendants’ property. 

Currently before this court is the United States’

motion for summary judgment requesting(1) entry of judgment

against the defendants for the income tax liability; (2) a

declaration of the validity of the United States’ federal tax

liens; and (3) an order of foreclosure of the property. Because

defendants did not file any opposition to the motion, the court

decides it without oral argument.1

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Summary judgment is proper “if the pleadings,

depositions, answers to interrogatories, and admissions on file,

together with the affidavits, if any, show that there is no

genuine issue as to any material fact and that the moving party

is entitled to judgment as a matter of law.” Fed. R. Civ. P.

56(c). A material fact is one that could affect the outcome of

the suit, and a genuine issue is one that could permit a

reasonable jury to enter a verdict in the non-moving party’s

favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248

(1986). The party moving for summary judgment bears the initial

burden of establishing the absence of a genuine issue of material

fact and can satisfy this burden by presenting evidence that

negates an essential element of the non-moving party’s case. 

Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). 

Alternatively, the moving party can demonstrate that the

non-moving party cannot produce evidence to support an essential

element upon which it will bear the burden of proof at trial. 

Id.

The non-movant “may not rest upon the mere allegations

or denials of the adverse party’s pleading.” Fed. R. Civ. P.

56(e); Valandingham v. Bojorquez, 866 F.2d 1135, 1137 (9th Cir.

1989). However, any inferences drawn from the underlying facts

must be viewed in the light most favorable to the non-moving

party. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp.,

475 U.S. 574, 587 (1986). In its inquiry, the court must not

engage in credibility determinations or weigh the evidence, for

these are jury functions. Anderson, 477 U.S. at 255.

“In an action to collect tax, the government bears the 

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initial burden of proof. The government, however, may satisfy

this initial burden by introducing into evidence its assessment

of taxes due” and providing a “minimal factual foundation” for

the assessment. Oliver v. U.S., 921 F.2d 916, 919-20 (9th Cir.

1990) (internal citations omitted). Unless the assessment is

“without rational foundation or is arbitrary,” “introduction of

the assessment establishes a prima facie case” for the

government. Id. Once “the government satisfies its initial

burden by introducing the assessment, [] the taxpayer then has

the burden of proof” to challenge the government’s claim that the

tax is due. Id.

In support of its motion for summary judgment, the

government has produced five Certificate of Assessments and

Payments for defendants for the tax years 1993 through 1997,

establishing that defendants owe $350,259.86, as of November 21,

2007. (Ashwell Decl. Ex. 1-10; Beile Decl. Ex. 1.) Factually,

the assessments were based on self-reported liabilities on Forms

1040 filed and signed under penalty of perjury by the defendants. 

(Pl.’s Stmt. of Undisputed Facts ¶¶ 1-2.) The Certificates of

Assessments also establish that the tax liabilities were properly

assessed by a duly authorized Secretary of Treasury, 26 U.S.C. §§

6201-6203, and that the notices and demand for payment of the

liabilities were properly sent to defendants. 26 U.S.C. §§

6303(a), 6321. 

In addition to the assessments and Forms 1040, the

government also supports its motion with Requests for Admissions 

that the United States served on defendants. The Requests for

Admissions asked defendants to admit that the amounts assessed

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were validly assessed and that the assessments have not been

paid. (Ashwell Decl. Ex. 11.) Defendants did not respond to the

Requests for Admissions, therefore the statements are deemed

admitted. Fed. R. Civ. P. 36; see also United States v.

Cunningham, No. 04-2483, 2006 WL 1628010, at *5 (E.D. Cal. June

7, 2006). 

The United States’ recorded tax liens are also valid. 

“When a taxpayer neglects or refuses to pay a federal tax

liability after assessment, notice, and demand for payment, [26

U.S.C.] § 6321 imposes a tax lien in favor of the government for

‘all property and rights to property, whether real or personal’

belonging to the taxpayer.” Cunningham, 2006 WL 1628010, at *5

(quoting 26 U.S.C. § 6321) (citing Drye v. United States, 528

U.S. 49, 55 (1999)). Defendants do not dispute that they own the

property at issue or that the United States has valid tax liens

against that property. 

Accordingly, this court must grant summary judgment in

favor of the United States because there is no genuine issue of

material fact as to the defendants’ tax liability or the validity

of the United States’ tax liens on defendants’ property. 

IT IS THEREFORE ORDERED that (1) the United States’

motion for summary judgment be, and the same hereby is, GRANTED;

(2) final judgment be entered against defendants in the amount of

$350,259.86, plus accrued but unassessed interest and penalties

as of November 21, 2007, plus interest pursuant to 26 U.S.C. §§

6601, 6621 and 28 U.S.C. § 1691(c) and other accruals as allowed

by law until paid in full; (3) the hearing set for January 7,

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2008 be, and the same hereby is, VACATED; and (4) once the clerk

of this court enters final judgment, the United States’ federal

tax liens shall be foreclosed and the subject property, described

as Parcel 3, as shown on that certain map entitled “parcel map,”

filed in the office of the recorder of the county of El Dorado,

State of California, on March 28, 1972 in book 5 of parcel maps

at page 75, Assessor’s parcel number 094-150-07, shall be sold

pursuant to 28 U.S.C. § 2001 and the following terms: 

1. The United States Marshal for the Eastern District of

California, his/her representative, or an Internal Revenue

Service Property Appraisal and Liquidation Specialist (“PALS”),

is authorized and directed under 28 U.S.C. §§ 2001 and 2002 to

offer for public sale and to sell the property. The United

States may choose either the United States Marshal or a PALS to

carry out the sale under this order and shall make the

arrangements for any sale as set forth in this order.

2. The United States Marshal, his or her representative, or

a PALS representative is authorized to have free access to the

property and to take all actions necessary to preserve the

property, including, but not limited to, retaining a locksmith or

other person to change or install locks or other security devices

on any part of the property, until the deed to the property is

delivered to the ultimate purchaser.

3. Additional terms and conditions of the sale are as

follows:

a. the sale of the property shall be free and clear of

the interests of Gerald W. Filice, Ursula Filice, Citifinancial

Mortgage, the United States, El Dorado County Tax Collector and

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the State of California, Franchise Tax Board;

b. the sale shall be subject to building lines, if

established, all laws, ordinances, and governmental regulations

(including building and zoning ordinances) affecting the

property, and easements and restrictions of record, if any;

c. the sale shall be held at the courthouse of the

county or city in which the property is located, on the

property’s premises, or at any other place in accordance with the

provisions of 28 U.S.C. §§ 2001 and 2002;

d. the date and time for sale are to be announced by

the United States Marshal, his/her representative, or a PALS;

e. notice of the sale shall be published once a week

for at least four consecutive weeks before the sale in at least

one newspaper regularly issued and of general circulation in El

Dorado County, and, at the discretion of the Marshal, his/her

representative, or a PALS, by any other notice deemed

appropriate. The notice shall contain a description of the

property and shall contain the terms and conditions of sale in

this order of sale;

f. The minimum bid will be set by the Internal Revenue

Service. If the minimum bid is not met or exceeded, the Marshal,

his or her representative, or a PALS may, without further

permission of this court, and under the terms and conditions in

this order of sale, hold a new public sale, if necessary, and

reduce the minimum bid or sell to the second highest bidder;

g. the successful bidder(s) shall be required to

deposit at the time of the same with the Marshal, his/her

representative, or a PALS a minimum of ten percent of the bid,

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with the deposit to be made by certified or cashier’s check or

cash payable to the United States District Court for the Eastern

District of California; before being permitted to bid at the

sale, bidders shall display to the Marshal, his/her

representative, or a PALS proof that they are able to comply with

this requirement; no bids will be received from any person(s) who

have not presented proof that, if they are the successful

bidders(s), they can make the deposit required by this order of

sale;

h. the balance of the purchase price for the property

is to be paid to the United States Marshall or a PALS (whichever

person is conducting the sale) within twenty days after the date

the bid is accepted, by a certified or cashier’s check payable to

the United States District Court for the Eastern District of

California; if the bidder fails to fulfill this requirement, the

deposit shall be forfeited and shall be applied to cover the

expenses of the sale, including commissions due under 28 U.S.C. §

1921(c), with any amount remaining to be applied to the federal

income tax liabilities of Gerald W. Filice and Ursula Filice at

issue herein; the realty shall be again offered for sale under

the terms and conditions of this order of sale; the United States

may bid as a credit against its judgment without tender of cash;

i. the sale of the property shall be subject to

confirmation by this court; the Marshal or a PALS shall file a

report of sale with the court, together with a proposed order of

confirmation of sale and proposed deed, within twenty days from

the date of receipt of the balance of the purchase price;

j. on confirmation of the sale, the Marshal or PALS

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shall execute and deliver a deed of judicial sale conveying the

property to the purchaser;

k. on confirmation of the sale, all interests in,

liens against, or claims to, the property that are held or

asserted by all parties to this action are discharged and

extinguished;

l. on confirmation of the sale, the recorder of deeds,

El Dorado County, California shall cause transfer of the property

to be reflected upon that county’s register of title; and

m. the sale is ordered pursuant to 28 U.S.C. § 2001,

and is made without right of redemption.

4. Until the property is sold, Gerald W. Filice and Ursula

Filice shall take all reasonable steps necessary to preserve the

property (including all buildings, improvements, fixtures and

appurtenances on the property) in its current condition

including, without limitation, maintaining a fire and casualty

insurance policy on the property. They shall neither commit waste

against the property nor cause or permit anyone else to do so. 

They shall neither do anything that tends to reduce the value or

marketability of the property nor cause or permit anyone else to

do so. The defendants shall not record any instruments, publish

any notice, or take any other action (such as running newspaper

advertisements or posting signs) that may directly or indirectly

tend to adversely affect the value of the property or that may

tend to deter or discourage potential bidders from participating

in the public auction, nor shall they cause or permit anyone else

to do so.

5. All persons occupying the property shall leave and

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vacate the property permanently within thirty days of the date of

this order, each taking with them his or her personal property

(but leaving all improvements, buildings, fixtures, and

appurtenances to the property). If any person fails or refuses

to leave and vacate the property by the time specified in this

order, the United States Marshal’s Office, alone, is authorized

to take whatever action it deems appropriate to remove such

person from the premises, whether or not the sale of such

property is being conducted by a PALS. If any person fails or

refuses to remove his or her personal property from the property

by the time specified herein, the personal property remaining on

the property thereafter is deemed forfeited and abandoned, and

the United States Marshal’s Office is authorized to remove it and

to dispose of it in any manner it deems appropriate, including

sale, in which case the proceeds of the sale are to be applied

first to the expenses of sale and the balance to be paid into the

Court for further distribution.

The proceeds arising from sale are to be paid to the

clerk of this court and applied as far as they shall be

sufficient to the following items, in the order specified:

1. To the United States Marshal or the PALS (whichever

person conducted the sale as arranged by the United States) for

the costs of the sale;

2. To all taxes unpaid and matured that are owed to Gerald

W. Filice and Ursula Filice for real property taxes on the

property;

3. To Citifinancial Mortgage, in the amount of the balance

due on the mortgage and deed of trust recorded on the property; 

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4. The State of California, in the amount owed on its tax

lien for the tax year 1995;

5. The United States, in the amount owed on its tax lien

that arose on November 26, 1996 for the tax year 1995;

6. The State of California, in the amount owed on its tax

lien for the tax year 1996; 

7. The United States, in the amounted owed on its tax liens

that arose on April 13, 1998 for the tax year 1995, and amount

owed on the tax liens for the tax years 1993, 1994, 1996 and

1997;

8. The State of California, in the amount owed on its tax

liens for the tax years 1997 through 2004.

9. Any balance remaining after the above payments shall be

held by the Clerk until further order of the court.

DATED: December 28, 2007

 

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