Document: 50 L.Ed.2d 530 97 S.Ct. 619 429 U.S. 338 G. M. LEASING CORP., Petitioner,v.UNITED STATES et al. No. 75-235. Argued Oct. 4, 1976. Decided Jan. 12, 1977. Syllabus The Internal Revenue Service (IRS), having investigated the income tax liability of a taxpayer who was fugitive from justice, determined deficiencies for two taxable years, and because taxpayer's failure to file proper returns his status, made jeopardy assessments pursuant § 6861(a) Code 1954. Petitioner corporation be alter ego taxpayer. Thereafter, decision levy upon seize automobiles registered in petitioner's name partial satisfaction against taxpayer, agents warrantless seizures several such property which petitioner had no interest. For purpose levying on other subject seizure, they also went office, cottage-type building, forced entry. Pending further information as whether cottage an office or residence, initial seizures, but days later again entered without warrant seized books, records, property. Thereafter petitioner, claiming that it not ego, assessment invalid, contents violated Fourth Amendment, instituted this suit, seeking return automobiles, suppression evidence obtained documents, damages IRS agents. District Court judgment finding committed illegal searches violation Amendment. Appeals most part reversed, ruling were valid, conclusively established unconstitutional. Section 6331(a) 1954 authorizes collect taxes "by all rights property" belonging person "neglects refuses pay" any tax, 6331(b) defines "levy" including "the power distraint seizure by means." Held: 1. This granted certiorari limited Amendment issue thus accepts Appeals' determinations levies valid taxpayer' s ego. does challenge aspect probable cause believe items properly therefore only question before is warrants required. P. 351. 2. automobile occurred public streets, parking lots, open areas, involved invasion privacy Murray's Lessee v. Hoboken Land & Improv. Co., 18 How. (59 U.S.) 272, 15 L.Ed. 372. Pp. 351-352. 3. entry into since "except certain carefully defined classes cases, search private consent 'unreasonable' unless has been authorized warrant." Camara Municipal Court, 387 523, 528-529, 84 1727, 1730-31, 930. 352-359. (a) Business premises are protected corporations have rights. intrusion here based, nature business, its license, regulation activities, ground assets seizable satisfy assessments, justify depriving simply corporation. 353-354. (b) Neither history common law laws States prior adoption Bill Rights nor case time justifies creation broad exception requirement intrusions furtherance enforcement. 354-356. (c) must read authorizing opposed searches. 356-358. (d) fall under "exigent circumstances" requirement, clear agents' own delay making records seized. 358-359. 4. Of various remedy issues raised individual need addressed grant present posture case. shown constitutional Whether, Government contends, entitled money if acted good faith should considered courts below light facts, procedures based Lessee, supra, existence proof injury resulting temporary books immunity reserved Bivens Six Unknown Fed. Narcotics Agents, 403 388, 91 1999, 29 619. 359-360. 514 F.2d 935, affirmed part, reversed remanded. Richard J. Leedy, Salt Lake City, Utah, petitioners. Sol. Gen. Robert H. Bork, Washington, D. C., respondents. Mr. Justice BLACKMUN delivered opinion Court. 1 We case, 423 1031, 96 561, 46 404 (1975), arising context assessments.1 2 * Leasing Corp. Utah organized April 1972; among stated business purposes leasing automobiles. George I. Norman, Jr., although apparently incorporator, officer, director general manager. 3 In 1971 Norman tried convicted United Colorado counts aiding abetting misapplication funds federally insured bank, U.S.C. §§ 656. He sentenced concurrent two-year terms imprisonment. On appeal, conviction affirmed. Cooper, 464 648, 651-652 (CA10 1972). denied certiorari. 409 1107, 93 901, 34 688 (1973). 4 wife, November 15, 1971,2 filed joint Form 1040 calendar year 1970 which, apart their names, address, social security numbers, occupations, dependents, indicated "(e)stimated," $280,000. sum $289,800 transmitted when form placed suspense account future credit. Apart naked figure estimated contained deductions. App. 94. 5 Normans sought extension within 1971. A check $405,125 given 1972, application tax. evidently dishonored. Although extensions granted, neither ever return. 6 October after Norman's Tenth Circuit, assigned Agent Clayton investigation. Clayton, however, took immediate action. Id., at 66; Tr. Oral Arg. 24-25. 7 March 1973, petition writ denied, rehearing 410 959, 1414, 35 695 (1973), he surrendered Marshal serving sentence. By ruse, immediately disappeared. 6. thereupon became justice; still one oral argument. 15; Brief Petitioners 5; 5-6. 8 Upon becoming fugitive, activated 19, amounts $406,099.34 $545,310.59, respectively.3 95. These solely third parties concerning amount stock sales through brokerage houses. 30, 67.4 Because appropriate collection so regarded jeopardy; deficiencies, therefore, assessed forthwith authority 1954, 26 6861(a).5 9 following day revenue called residence City endeavor taxes. Mrs. answered door. informed her demanded payment. No payment forthcoming, suggested get touch with attorney. 56. 6331 Code, notice liens County Recorder's Office levied bank Norman. 95, 58. 10 While observed parked driveway. Later, checking Motor Vehicle Division, learned these vehicles another owned wife. 73-74. They license conduct telephone listing. 74. It ascertained that, request Department Employment Security, Status Report. That report described corporation's principal activity "leasing Luxury Automobiles, Boats, etc." recited "average number employees" zero paid wages while during last three quarters 1972 far 1973. 91-92. Sales Use Tax Return second quarter reported sales. 93. seen "show" "collector" cars type "that would normally used business." 11 All facts engaged but, instead, repository least some personal assets. consulted Service's Regional Counsel. With concurrence, conclusion drawn actually belonged Accordingly, titled 75-76. 12 about 21, officers, warrant, Among them Stutz, Rolls Royce Phantom V, 1930 I, Stutzes, Jaguar. Three taken different locations City; Century Plaza lot Los Angeles, Cal.; near City. 121, 129; 13-14. None name. officers left Chevrolet station wagon use family.6 13 Also building itself. 19. one, possibly two, luxury might there. learning car garage premises, telephoned superior, Bert Applegate, asked him come out assist. 77-79. consisted garage. When Applegate arrived, locksmith already removed lock door direction officers. Stutz inside. cottage's rear 80-81. 14 cottage. outward appearance could residence. noticed kitchen. instructed proceed there until status confirmed.7 81, 23-24. then taking anything, replaced. 82. cottage, son, III, age listed dependent 1040, appeared. told corporation, 80, 34. testified living "as security." provide car's ownership. time. 16 Information came primarily Redd contractor place 79. addition, night; lights boxes being moved. next morning garage.8 83. Sometime days, furnishings there.9 23,10 agents, acting assistance locksmiths equipment van storage firm, remaining contents, records. An inventory hoped examine see certificates location Counsel, pack seal boxes, remove safe place. 83-88. 17 May, suit. amended complaint asserted claim wrongful levy, automobiles; documents; damages. 105-112. alleged arbitrary capricious, Ibid. Shortly thereafter, returned originals documents meantime, photocopied.11 amendment complaint, id., 124, punitive damages, relief, requested. 19 son intervention, 112-117, alleging essentially same requesting similar relief. allowed intervention. counterclaim foreclosure held 127-134. 20 At ensuing trial court jury testimony himself originally title name, 37; employees did lease cars, 37, 39; vintage model transferred end never issued stock, director's meetings, business.12 43-45. 21 intervenor. found offices intervenor; revenue-officer defendants warrant; forcibly 23 25;13 entry, search, "knowing full well violating rights" intervenor, "and others"; "maliciously"; photocopied retained photocopies; seven account; disposed stored others taxes, penalties, interest wife erroneous; federal those years; "engaged substantial preparation automobiles"; controlled wife; nominee. concluded intervenor's Amendment; photocopies possession destroyed illegal; intervenor determined; Government's dismissed prejudice; awarded favor value sold. 136-142. Judgment, injunctive relief destruction photocopies, accordingly. 142-144. 22 Appeals, reversed. 935 1975). ruled liability; Court's contrary clearly sustained burden proving erred invalidating dismissing counterclaim. regard held: "The refusal pay appellants included 'seizure means.' Thus statute commit search. court's order returning suppressing improper." (Footnote omitted.) 941. 24 support Clayton's participation "was malicious character." accord concession Government, insofar ordered shares intervenor.14 II 25 A. Secretary delegate "or lien . tax."15 6331(b), 7701(a)(21) well, define Both real estate property, tangible intangible, levy. Levy effected service forms physical Where feasible, posted tagged. intangible susceptible posting, tagging, party holding See Treas.Reg. 301.6331-1(a)(1), CFR 301.6331-1(a)(1) (1976). Phelps States, 421 330, 335-337, 95 1728, 1731-32, 44 201 (1975). And recognized compulsion occasionally required enforcement laws. Bisceglia, 420 141, 145, 915, 918, 43 88 Indeed, may readily acknowledge essential our self-assessment system enhances voluntary compliance lifeblood government, prompt availability imperious need." Bull 295 247, 259, 55 695, 699, 79 1421 (1935). Under 6321 Code,16 If countervailing effect Griffiths Commissioner, 308 355, 60 277, 319 (1939); Higgins Smith, 473, 476, 357, 406 (1940). follow 6321, empowered, 6331, liability. Plastic Electro-Finishing Corp., 313 F.Supp. 333-334 (EDNY 1970), aff'd, 71-1 USTC P 9421 (CA2 1971). 27 B. Our issue, we declined review son's claims voided Pet. Cert. 2, 3.17 approach accepting Those necessarily establish assessments. contain goods. There questions make "reasonable" either goods 28 C. places, involve privacy. 372 (1856), judicial debtor's land States. transfer governed principles Hester 265 57, 445, 68 898 (1924) (liquor field).18 offices. Significantly, said: 30 "(O)ne governing principle, justified current experience, consistently followed: except 87 1731, 930 (1967). 31 Coolidge New Hampshire, 443, 454-455, 2022, 2031-32, 564 (1971); 512, 2061 (White, J., concurring dissenting); Stoner California, 376 483, 889, 856 (1964); Jeffers, 342 48, 72 93, 59 (1951); McDonald 335 451, 69 191, 153 (1948); Agnello 269 20, 70 145 (1925). 32 respondents do contend Such proposition defended holdings contrary. Seattle, 541, 1737, 943 (1967); Go-Bart Co. 282 344, 51 153, 75 374 (1931); Silverthorne Lumber 251 385, 40 182, 64 (1920). Nor can claimed supra; Oklahoma Press Pub. Walling, 327 186, 205-206, 66 494, 503-04, 90 614 (1946); Hale Henkel, 43, 75-76, 370, 379, 652 (1906). Cf. California Bankers Assn. Shultz, 416 94 1494, 39 812 (1974); Federal Trade Comm'n American Tobacco 264 298, 305-306, 336, 337, 696 (1924); Wilson 221 361, 375-376, 538, 542, 771 (1911); Consolidated Rendering Vermont, 207 553-554, 178, 181, 52 (1908). 33 course, special existence, itself permissible purely context. Thus, Biswell, 311, 92 1593, (1972), locked storeroom hours, inspection procedure Gun Control Act 1968, 923(g), upheld: "When dealer chooses engage pervasively regulated accept knowledge firearms, ammunition will effective inspection." U.S., 316, 1596. Colonnade Catering 397 72, 774, (1970) (Congress fashion standards reasonableness regulate liquor industry failed authorize search). 36 activities. Rather, involves nothing more than normal laws, find justification treating differently circumstances 37 argue allows recognize "Power lay Taxes" specifically enunciated Const., Art. 8, cl. 1, First Congress, proposed Rights, provided "levied distress sale persons refusing neglecting pay." Mar. 3, 1791, c. 23, Stat. 204. This, relates rather thing resting area privacy, quite even situated access otherwise available seizing officer. 38 primary evils intended eliminated massive undertaken writs assistance.19 As Madison argued, urging restrain Government: General right pass shall necessary revenue; means enforcing Legislature: purpose, supposed framing constitutions State Governments view? reason restraining exercising power, like Government." Annals Cong. 438 (1834 ed.). urge England view cover cited materials anything approaching create great Amendment's protections 41 rely dicta Boyd 116 616, 524, 746 (1886)20 (subpoena papers impermissible). But Fisher 425 391, 408-411, 1569, 1579-80, 48 (1976), Andresen Maryland, 427 463, 471-472, 2737, 2744, 49 627 (1976)). direct apply invasions collection. Insofar language state, decline rejection basic principle shaped law. 42 Finally, congressional enactment, Biswell Colonnade. statute, "distraint n. supra. Read narrowly, every deprive use, enjoyment, (e. g., transferring title, asportation, immobilization). refer respondents, us intrusions. assert kind considerations discussed See. Examination shows opposite true. critical concerns discretion Respondents 66. Yet gives what seize. involved, choose dwelling invaded. both places hardly restraint discretion. concern disputed fact. situation questions; yet confusion over demonstrates obtaining relevant factor. 67-68. suggest dealing attempt put beyond reach. whenever neglects regardless indication risk concealment. focus situations involving rapid 45 bring reasoning cases highly activity. covers defaults unwilling hold mere sufficient declaring per se exempt seizure. less home. Even correct, assertion irrelevant respect intent makes distinction between properties areas. entries all, homes. 47 offer legislative reading give call constitutionality serious question. giving carte blanche natural reading, namely, authorization silent rule 1731. alternative argument new recognized, requirement.21 actions, first observation moved implicit exigent conclude commands III takes remedy. Specifically, prayed records; declaration Norman; (e) evidence; (f) release levies; (g) defendant-agents. 123-124. noted, review. returned, concededly destroyed; claim, thus, moot. decided legality adversely petitioner. obviously premature proceedings arise seeks them. Meister 268, (CA3 1968); Hill 346 175 (CA9), cert. 382 956, 86 433, 361 (1965). irreparable motion suppress, Fed.Rule Crim.Proc. 41(e), equitable grounds advance proceedings, demonstrated. Hunsucker Phinney, 497 29, (CA5 1974), 927, 1124, 53 leaves "maliciously said seizure," 138, of" actions. illegal, maliciousness unsupported record erroneous. F.2d, 940-941. awarding 942. 54 above, obtained, forcible effected. brings consideration (1971), reservation suggests assuming faith; supported "apparent fact" conformity standard supra ; faith. be, instance and, directs, remanded consistent opinion. 56 ordered. 57 Chief BURGER, concurring. 58 I concur useful note factual setting provides seems, me, classic illustration dividing line impermissible, requirement. After into, retreat from, office-cottage, investigation 24-hour surveillance. One night course surveillance, cartons unknown Against background surreptitious nighttime constituted circumstance protect interests especially delinquent was, time, justice. Rather immediately, chose wait approximately half agree facts; holds observing suspicious events unavailable failing act once, exigency dissipated, understand imply, way, removal cartons, reasonably needed permitting reads: people secure persons, houses, papers, effects, unreasonable violated, Warrants cause, Oath affirmation, particularly describing searched, things seized." Four filing granted. 99. $69,265.04 $84,873.50, respectively. 96. witness cross-examination "No" "able cooperation all" 30. behalf gave negative answer received "any accountant representative." protests adverse inference flow asserts requested representatives powers attorney Service. Reply 3-4. Counsel stated: "I want correct wrong implication (N)obody (his fugitive) cooperation." 25. Jeopardy 97. 6861(b) enables redetermination deficiency. Laing 161, timely sent His awaits (Docket 6000-73). Angeles two-door tan valued $30,000, four-door burgundy $100,000. financed loans Murray Thrift. Following foreclosed arranged 33, 122. appears participate transactions portion proceeds Manual, 5341.1, instructs occupant denies officer permission enter, force. particular location. 21. Title Real Estate, Inc., suit requests include 23. 34, 59, 77. brief state pending appeal Circuit voluntarily existing 9, 76-77, 43. concedes destroyed. 14-15. conflicting issued. 52-53. date error. 10, affirming us. here. 13. reads part: "(a) Authority delegate. "If liable demand, lawful (and expenses levy) (except section 6334) chapter jeopardy, demand thereof 10-day period section. "(b) Seizure term 'levy' includes means. extend possessed obligations thereof. sell (whether personal, intangible)." (including interest, additional amount, addition assessable penalty, together costs accrue thereto) person." effectuated denial result, decisions sustaining summary administrative proceedings. 260, (1935), "is force judgment, due, officials debt." Cheatham 85, 87-90, 561 (1876); Railroad Cases, 575, 612-615, 663 Graham Du Pont, 262 234, 255, 567, 569, 67 965 (1923). rationale underlying decisions, very government depends revenues. Phillips 283 589, 596-597, 608, 611, 1289 (1931), rejected statutory collected summarily pre-seizure hearing. long adequate opportunity post-seizure determination rights, met requirements due process. Commissioner Shapiro, 424 614, 630-633, 1062, 1072-1074, 278 (1976); Fuentes Shevin, 407 67, 91-92, 1983, 1999-2000, 556 (1972). center Due Process Clause analysis yields result. noted Phillips, 596, approval "more character" "involving directly obligation taxpayer." T. Taylor, Two Studies Constitutional Interpretation (1969); N. Lasson, History Development Constitution 51-78 (1937); Landynski, Search Supreme 30-42 (1966). Boyd, stolen forfeited goods, duties concealed avoid thereof, totally man's therein contained, using him." 623, 528. establishing impermissibility subpoena papers. concerned places. say: sheriff law, chattels virtue writ, attachment, sequestration, execution, prohibition Fifth clause Constitution." 624, 529. (emphasis added). with, explain, "judicial writ" referred above meet requirements. describe "obnoxious assistance" designed protect. description types tax-enforcement actions reach: "Even obnoxious go this, examination ships vessels, therein, prohibited imported exported, paid, enter suspected vaults, cellars, warehouses goods." "hot pursuit," "plain view," "pursuant arrest," applicable

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