Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-89-03258/USCOURTS-ca10-89-03258-0/pdf.json

Nature of Suit Code: 870
Nature of Suit: Tax Suits
Cause of Action: 

---

' ., . PILED 

UNITED STATES COURT OF APPEALS 

FOR THE TENTH CIRCUIT 

United States Court of Ap_peals 

Tenth Circuit 

JUN 2 9 1990 

ROBERT L. HOECKER 

Clerk 

JAMES T. FINLEN, JR., Personal 

Representative of the Estate of 

James T. Finlen, 

Plaintiff-Appellant, 

v. 

UNITED STATES OF AMERICA, 

Defendant-Appellee. 

) 

) 

) 

) 

) 

) 

) No. 89-3258 

) (D.C. No. 89-2242S) 

) (D. Kansas) 

) 

) 

ORDER AND JUDGMENT* 

Before TACHA, SETH, Circuit Judges, and BROWN,** District Judge. 

**Honorable Wesley E. Brown, Senior District Judge, United States 

District Court for the District of Kansas, sitting by designation. 

In this case, the personal representative of an estate claims 

interest on a replacement tax refund check from the date the 

government was notified that the replacement check was necessary 

until the date it was issued. Because there is no statutory 

authority for the payment of such interest, we affirm the decision 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth Circuit, 

except for purposes of establishing the doctrines of the law of 

the case, res judicata, or collateral estoppel. 10th Cir. R. 

36.3. 

Appellate Case: 89-3258 Document: 010110037508 Date Filed: 06/29/1990 Page: 1 
of the district court to dismiss the action pursuant to 

Fed. R. Civ. P. 12(b)(6). 

Drawing from the district court Memorandum and Order, filed 

August 24, 1989: 

The uncontested facts are that on May 30, 1987, the 

plaintiff received a United States Treasury check, dated 

May 22, 1987, in the amount of $130,587.99, representing 

an estate tax refund plus interest of $15,098.99. This 

refund check was inadvertently placed in the trash and 

destroyed on June 1, 1987. On June 2, 1987, the 

plaintiff notified the Internal Revenue Service (IRS) of 

the loss of the refund check and demanded a replacement 

check, which plaintiff received on December 3, 1987, in 

the amount of the original check, i.e., $130,587.99. 

The plaintiff filed the [district court] action to 

obtain interest on the refund check from May 22, 1987 

(the date of the first check) to December 3, 1987, the 

period between issuance of the first and second refund 

checks. 

Memorandum and Order, R. Vol. I, tab 6 at i-2 (citations to 

plaintiff's complaint omitted). Accord Brief for the appellant at 

4; Brief for the appellee at 4. The estate concedes on appeal 

that the United States owes no extra interest on the refund from 

May 23, 1987, to June 1, 1987. 

The district court granted the United States' motion to 

dismiss for failure to state a claim upon which relief can be 

granted, relying on 26 U.S.C. § 66ll(b)(2)(1989). 

provides: 

Section 6611. Interest on overpayments 

That statute 

(b) Period. 

as follows: 

Such interest shall be allowed and paid 

(2) Refunds. In the case of a refund, from the 

date of the overpayment to a date (to be determined 

by the Secretary) preceding the date of the refund 

·check by not more than 30 days, whether or not such 

refund check is accepted by the taxpayer after tender 

of such check to the taxpayer. The acceptance of 

such check shall be without prejudice to any right of 

2 

Appellate Case: 89-3258 Document: 010110037508 Date Filed: 06/29/1990 Page: 2 
the taxpayer to claim any additional overpayment and 

interest thereon. 

Id. We note that the statute does not provide for additional 

interest on delivered, received and valid refund checks which must 

be replaced due to inadvertent loss by the taxpayer. 

This court and others have long held that unless explicitly 

provided by statute or contract, interest is not recoverable on an 

obligation owing by the government. Dresser v. United States, 180 

F.2d 410, 411 (10th Cir. 1950); Steiner v. Nelson, 309 F.2d 19, 21 

(7th Cir. 1962); Doolin v. United States, No 89.-CV-898, slip op. 

at 7-8 (N.D.N.Y. Apr. 20, 1990); cf. Rosenman v. United States, 

323 U.S. 658, 663 (1945)( 11 Exaction of interest from the government 

requires statutory authority. II • • • • I interest requested on 

advance payment of estimated taxes); Universal Pictures Co. v. 

United States, 345 F.2d 1002, 1006 (2d Cir. 1965)( 11 [F]or interest 

to run against the Government, taxpayer must point to a specific 

statutory provision."; rejecting equitable 11 use of money" theory; 

interest requested on overpayments of interest by taxpayer on 

income and excess profits tax payments); see generally Annotation, 

Right to Interest on Tax Refund or Credit in Absence of Specific 

Controlling Statute, 88 A.L.R.2d 823, 840 (1963 & Supp. 1979 & 

1989). 

In this case, Finlen points to no statutory provision for the 

interest which he requests under the circumstances presented here. 

The refund check was timely delivered, timely received and capable 

of negotiation. Situations 3 and 4 of Rev. Rul. 76-74, 1976-1 

C. B. 388, in which allowance of interest on a replacement check 

was recommended, are distinguishable from these facts, as are 

3 

Appellate Case: 89-3258 Document: 010110037508 Date Filed: 06/29/1990 Page: 3 
cases which allow for additional interest on replacement checks 

under facts similar to those two situations. See,~, American 

Potash Co. v. United States, 8 F.Supp. 717, 717-18 (Ct. Cl. 

1934)(payment on refund check wrongly stopped by Comptroller of 

Currency); M.J. Whittall Assocs. Ltd. v. United States, 

50 F.2d 307, 307 (Ct. Cl. 193l)(check made out to wrong party). 

The judgment of the United States District Court for the 

District of Kansas is therefore AFFIRMED. 

ENTERED FOR THE COURT 

PER CURIAM 

4 

Appellate Case: 89-3258 Document: 010110037508 Date Filed: 06/29/1990 Page: 4