NO. 07-07 -030 8-CV IN THE CO UR T OF APPEA LS FO R THE S EVEN TH D ISTRI CT O F TEXAS

AT AM AR ILLO PAN EL B OC TOBER17, 2007

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___ JEF FR EY

GAR RE TT CR OSS, Appel lan t
v. US AA F ED ERAL SA

VIN GS B AN K, J EN NI FERM AY , ET A L., Appel lee s

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______ FRO M T HE 35 3 DIS T RI CT COU RT OF T RAVI S CO UNT Y; RD NO. D-1-GN-06-003 882 ; HON. MARGARET A. COOPER , PRESI DING

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____ Memorandum Opinion

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____ Bef ore QUINN, C.J., and CAMPBELL and HANCOCK, JJ. Je f f re y Gar re ttCro ss , a ct in g pr o s e, app eals f rom a summ ary judgme nt g rante d in fav or of US AA F ederal Sav ing s B ank (U SAA) and Jenni fer M ay ( Ma y ) as w ell as from an
order deny ing his ow n motion for summary

judg ment. Cros s sued USA A and it s e mploy ee Ma y for h onor ing a t ax

l ev y by the Inter nal R ev enue Ser v ic e (I RS ). He soug ht as damag es treb l e th e am ou nto f mo ne y r em i tt ed t o th e IR S. W e affi r m.2

Sum m ar y J udgm ent W e rev iew

a t ra dit ion al moti on for summar y jud g ment, suc h as thatbefore us, under th e st andard s et forth i n Ni xon v. Mr

. Pr oper ty Ma nagem ent C o., 690 S.W .2d 5 4 6 (T e x. 1985)

. W e nex t note that the IRS maylev y upon all proper

ty and ri g hts to proper

ty upon
w hich th ere exists a li en for unp a id t a xe s . 26 U.S. C.A. §6 331 (a) (W est Su pp. 200 7). Furthe rmore , anyone posse ssing such prope rty upo n w hich a levy has been ma de m ust surrend e r it “ e xc e p t [for] such p art of the pro perty or r ights as is, at the tim e of such dem and , subje ct to an atta chm ent or e x ecut ion und er a ny judicial proce ss.” Id. §6332( a) (W est 2002)

. Fai li ng or re fusing to sur re nder the proper ty ma ke s t h e stakeh old er personal ly

l iab le to t he g ov er nment for t h e va lu e of

the proper

ty w it hhel d. Id. §63 32(d ). How ev er , sur re nder ing the proper ty “ dis charg e[s ] [ the s tak ehol der] from any obl ig ati on or li abi li ty to the d eli nq uent tax pay er and any othe r p e rs on w it h r espec t t o s uch proper ty or rig hts to prop erty arising from such surrend er or paymen t.” Id. § 633 2(e). In oth er w ords, the I RS can l e v y

upon proper

ty enc umber ed by

a l ien for u npai d tax es. I f the person hol din g the proper

ty does not re lea se it , he becomes perso nal ly liab le to the g ov er nment for th e v alu e of the proper ty hel d. But, i f he tur ns itov er , t hen he is i nsul ated from l iab il it y to t he ta x

debt or . Notonl y i s t h e foreg oin g st atute and procedu re co nst it uti onal , United State s v. Nat ion al Bank

of Com m er

ce, 472 U .S. 7 1 3 , 721, 105 S.C t. 2919, 2925, 86 L. Ed.2d 565 (1 985) , butal so the o pti ons av ail abl e to the par ty hol din g the proper

ty ar e li mite d. Ei ther he can rel ease it , il lus tr ate that he does not posses s it, or show that it is subjec t to a pr iorO ur hol di ng a l so i ncl udes t he a l l egat i on t hat U SA A and M ay som ehow ad m i t t ed l i abi l i t y beca use t hey 1 d id n o t r e s p o n d to v a r io u s w r itt e n d e m a n d s C r o s s m a d e . S im p ly p u t, f e d e r a l s ta tu te n e g a te d th e c la im s u n d e rly i n g h i s d e m a n d s . S o , t h e re w a s n o th i n g to s u p p o rt th e m . 3 jud ic ial att achmentor

ex ecut ion

. United S tates v. Nati onal Bank of Com m er

ce, 472 U .S. at 72 1- 22, 1 05 S. Ct . at2925. The re cord at bar cont ain s no ev ide nce sug g est ing thatthos e w ho C ro ss su ed ei ther lac ked poss ess ion of t he money subj ect ed to levy or that the mone y w as subj ectto a pr ior attac hment or

ex ecut ion

. Thus, nei ther US AA nor it s employ ee (M ay ) coul d c hal len g e the
v ali dit y of the l ev y . Mo or

e v . G ener al Mo tor s Pensi on Pl ans, 91 F.3 d 848 , 851 (7 Cir

. th 1996)

. And, in abi din g by the levy , bot h US AA and Ma y w er e re li ev ed of any obl ig ati on or l i a b i l i t y t o C ro s s a r i s i n g fro m t h e a c t o f s u r re n d e r i n g t h e pr operty

. Jo nes v. Bass, 343 F. Supp.2 d 1066, 1070 ( D. W y o. 20 04) , aff’ d, No. 04- 8113, 2005 U .S. App. L E X IS 19187 (1 0 C ir . Se ptember

2, 2005) , cer

t. denied, 547 U .S. 1019, 126 S. C t. 1573, 164 L. Ed.2d th 299 ( 2006)

. So, and as a matter of law , C ro ss co uld not re cov er from ei ther

U SAA or

M ay for th e pur por

ted b re ach of contractunder ly ing hi s s uit or any other cl aim ti ed to ho nor ing the lev y , and summ aryjudgmen t in favor of th e tw o de fend ant s w as prop er. 1 Mo ti on fo r Sanc ti

ons Also p e n d in g b e fore us i s t he moti on for sanc ti ons filed by U SAA and M ay . The lat ter tw o c ontend that they ar e enti tl ed to re asona ble attor ney ’s fees and co urt c ost s a s sa n ct io n s fo r re sp o n d in g to a f rivo lo u s ap p e a l. Ass u m in g ar guendothatthe appeal w as f riv olou s, w e ha v e no ev iden ce be fore us of w hat a reason able atto rney’s fee would be in
re spond ing to the a ppeal

. So, w e hav e no basi s u pon w hic h to aw ard any fees. As for4

cour t c ost s, they

are nor mall y

l ev ied ag ain st the l o sin g p a rt y . So, becau se Cross i s t he los ing par

ty here, i t matt ers n ot w hether the appeal w as friv olo us. Acc ordin g ly , t he j udg ment of the tr ial co urt i s a ff ir med.

Per C ur iam