Source: https://supreme.justia.com/cases/federal/us/288/426/case.html
Timestamp: 2017-06-28 21:03:58
Document Index: 618873697

Matched Legal Cases: ['§ 278', '§ 278', '§ 278', '§ 278', '§ 278', '§ 278', '§ 250', '§ 110', '§ 278']

Pacific Coast Steel Co. v. McLaughlin (full text) :: 288 U.S. 426 (1933) :: Justia US Supreme Court Center Log In
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Pacific Coast Steel Co. v. McLaughlin 288 U.S. 426 (1933)
U.S. Supreme CourtPacific Coast Steel Co. v. McLaughlin, 288 U.S. 426 (1933)Pacific Coast Steel Co. v. McLaughlinNo. 518Argued February 15, 1933Decided March 13, 1933288 U.S. 426CERTIORARI TO THE CIRCUIT COURT OF APPEALS
1. Clause (2) of paragraph (e) of § 278 of the Revenue Act of 1924, which declares that that section shall not "affect any assessment made . . . before the enactment of this Act," does not render inoperative the provisions of paragraph (c) of the same section authorizing waivers with respect to taxes of which the assessment had been made but the collection had become barred prior to the date of the Act. P. 288 U. S. 428.
2. Waivers given after the date of the Revenue Act of 1924 with respect to the collection of taxes barred before that date are not invalid under clause (1), paragraph (e) of § 278 of that Act. See McDonnell v. United States, ante p. 288 U. S. 420. P. 288 U. S. 429.
McDonnell v. United States, ante, p. 288 U. S. 420, involved the question of the effect of § 278(e) on Page 288 U. S. 427 assessment waivers where the period for assessment had expired before the effective date of the act of 1924. This case involves the effect of that section on collection waivers where the period for collection had expired before the effective date of the Act of 1924, but where the assessment had been timely, and before the Act.
The district court, without opinion, entered judgment for the defendant. The circuit court of appeals held that the waiver, though in terms extending the time for assessment, was effective to extend that for collection, and that the waiver was valid under § 278 of the Revenue Act of 1924. The judgment of the District Court was accordingly affirmed. 61 F.2d 73. This Court granted certiorari "limited to the question of the effect of § 278(e) of the Revenue Act of 1924." 287 U.S. 595. Page 288 U. S. 428
The petitioner contends that clause (2) of paragraph (e) of § 278, which states that the section shall not "affect any assessment made, or distraint or proceeding in court begun, before the enactment of this Act," renders paragraph (c) inoperative in the case at bar; that the waiver therefore had no statutory authority, and was of no effect. The government insists, in answer to this contention, that even if clause (2) thus qualifies paragraph (c), [Footnote 1] the waiver is nevertheless valid either without express statutory authority or under the authority of the Revenue Act of 1921, § 250(d), [Footnote 2] which, it is argued, remained in force by virtue of § 110(b) of the Act of 1924. [Footnote 3] We do not pass upon this contention of the government; for we are of opinion that paragraph (c) is not rendered inoperative by clause (2) of paragraph (e).
The meaning of clause (2) was considered in Russell v. United States, 278 U. S. 181. It was there pointed out Page 288 U. S. 429 that the distinction in the Act of 1924 between existing and subsequent assessments derived significance from the contemporaneous creation of the Board of Tax Appeals. Assessments made after June 2, 1924,
278 U.S. at 278 U. S. 186. Where an assessment was made before the Act, the reason for the extension did not exist. In the case of waivers, no such considerations exist to indicate that Congress intended to distinguish between assessments made before and those made after the Act. It was held in the Russell case that to apply paragraph (d), extending the period for collection to six years after assessment, to an assessment made before the Act would "affect" that assessment, and hence was forbidden by clause (2) of paragraph (e). Such an application, it was said,
278 U.S. at 278 U. S. 187. In the case at bar, no such effect follows upon a recognition of the waiver. The claim against the petitioners was barred, it is true, at the time of the enactment of the 1924 Act, but, even before the Act, the claim was subject to revival by waiver of the statute of limitations. We are of opinion, therefore, that paragraph (c) does not "affect" the assessment in the case at bar so as to be rendered inoperative by clause (2) of paragraph (e).
There remains the question of the effect of clause (1) of paragraph (e), which provides that § 278 shall not authorize an assessment or collection already barred at the effective date of the 1924 Act. This is the same question considered in the McDonnell case, ante, p. 288 U. S. 420, with respect to assessment waivers, and, for the reasons there Page 288 U. S. 430 stated, we hold that the clause does not impair the validity of the waiver here involved.