Court Opinion

ID: 3057851
Source: CourtListenerOpinion
Date Created: 2015-10-14 00:20:26.035034+00
Date Added: 2024-06-11T09:05:04.082854
License: Public Domain

[DO NOT PUBLISH]

             IN THE UNITED STATES COURT OF APPEALS

                     FOR THE ELEVENTH CIRCUIT                    FILED
                      ________________________          U.S. COURT OF APPEALS
                                                          ELEVENTH CIRCUIT
                                                              MAY 24, 2012
                             No. 11-11007
                                                               JOHN LEY
                         Non-Argument Calendar                  CLERK
                       ________________________

                D.C. Docket No. 8:10-cv-02652-RAL-TBM

ERNEST ENAX,

                                                           Plaintiff-Appellant,

                                  versus

COMMISSIONER OF IRS,

                                                         Defendant-Appellee.

                      ________________________

                Appeal from the United States District Court
                    for the Middle District of Florida
                      ________________________

                              (May 24, 2012)

Before HULL, MARCUS and BLACK, Circuit Judges.
PER CURIAM:

       Ernest Enax pro se appeals the district court’s dismissal of his action against

the Commissioner of the Internal Revenue Service (“IRS”) for improperly levying

his social security benefits. The district court dismissed Enax’s complaint for

failure to state a claim. After review, we conclude the district court lacked subject

matter jurisdiction to reach the merits of Enax’s claim and remand for the entry of

an order dismissing Enax’s complaint on that ground.1

                              I. BACKGROUND FACTS

       Enax’s complaint alleged that beginning January 2007, the IRS levied over

fifteen percent of his social security benefit, in violation of 26 U.S.C. § 6331(h).

On March 30, 2010, Enax sent a certified letter to the local Taxpayer Advocate

Service and to the IRS demanding that “the IRS discontinue any and all levies” of

his social security benefit checks in excess of fifteen percent and “refund all those

monies taken in excess” of fifteen percent. However, the IRS continued to levy

his social security benefit. Enax’s complaint sought an order: (1) finding that the

IRS violated the law when it took more than fifteen percent of Enax’s social

security benefit; (2) prohibiting the IRS from levying more than fifteen percent of

       1
       We review de novo whether the district court had subject matter jurisdiction. Adventure
Outdoors, Inc. v. Bloomberg, 552 F.3d 1290, 1294 (11th Cir. 2008).
                                              2
Enax’s social security benefit in future; and (3) requiring the IRS to “refund all

those monies taken in excess of” fifteen percent, plus interest.

       The IRS filed a motion to dismiss, arguing, inter alia, that the district court

lacked subject matter jurisdiction because Enax had failed to plead an applicable

waiver of sovereign immunity and did not comply with the prerequisites of a tax

refund suit. The district court granted the IRS’s motion to dismiss. Although the

district court stated that the IRS’s jurisdictional argument had merit, it dismissed

Enax’s complaint because it concluded that the IRS may levy in excess of fifteen

percent of an individual’s social security benefit payments. The district court

denied Enax’s subsequent motion for reconsideration and request to file a brief in

opposition to the IRS’s motion to dismiss.2 Enax appealed.3

                                       II. DISCUSSION

       The United States has sovereign immunity from suit unless it consents to be

sued, and the statute consenting to suit “define[s] [the district] court’s jurisdiction

       2
         Given that the district court lacked subject matter jurisdiction, we find no reversible error
in the district court’s granting of the IRS’s motion to dismiss before Enax could file a brief in
opposition. See Chudasama v. Mazda Motor Corp., 123 F.3d 1353, 1366-67 (11th Cir. 1997)
(explaining that the district court does not abuse its discretion in managing its docket where the
litigant’s rights are not materially prejudiced).
       3
         Although Enax’s pro se notice of appeal specified that he was appealing the district
court’s February 11, 2011 order denying his motion for reconsideration, it is overwhelmingly
clear from his appellate brief that he also intended to appeal the district court’s January 14, 2011
order dismissing his complaint and January 18, 2011 judgment. See KH Outdoor, LLC v. City of
Trussville, 465 F.3d 1256, 1260 (11th Cir. 2006).
                                                  3
to entertain the suit.” Christian Coalition of Fla., Inc. v. United States, 662 F.3d

1182, 1188 (11th Cir. 2011) (quotation marks omitted). Under 28 U.S.C.

§ 1346(a), the district court has original jurisdiction to hear a civil action against

the United States “for the recovery of any internal-revenue tax alleged to have

been erroneously or illegally assessed or collected, or any penalty claims to have

been collected without authority or any sum alleged to have been excessive or in

any manner wrongfully collected under the internal-revenue laws[.]” 28 U.S.C.

§ 1346(a). However, before a taxpayer may bring such an action against the IRS,

the taxpayer must first file an administrative claim with the IRS for a refund or

credit “according to the provisions of law in that regard” and any applicable

regulations. 26 U.S.C. § 7422(a); see also 26 C.F.R. § 301.6402-2(a).

      These requirements include, inter alia, the full payment of all taxes owed to

the IRS. Flora v. United States, 357 U.S. 63, 68, 78 S. Ct. 1079, 1083 (1958),

aff’d on reh’g, 362 U.S. 145, 80 S. Ct. 630 (1960). In addition, the administrative

claim must be “verified by a written declaration”; set forth “in detail each ground

upon which a credit or refund is claimed and facts sufficient to apprise the

Commissioner of the exact basis” of the claim; and use the appropriate tax refund

form. 26 C.F.R. §§ 301.6402-2(b), 301.6402-3(a). The administrative claim also

must be filed within three years of the filing of the return or within two years of

                                           4
the tax being paid. 26 U.S.C. § 6511(a); Wachovia Bank, N.A. v. United States,

455 F.3d 1261, 1269 (11th Cir. 2006). If the taxpayer does not comply with these

requirements, the district court does not have jurisdiction to entertain the tax

refund suit. Id. at 1264.

      Here, Enax does not contend that he complied with any of these

requirements before filing his tax refund suit. Specifically, Enax does not claim

he paid the full sum of taxes owed, and, indeed, his request to prevent the IRS

from taking more than fifteen percent of his social security benefits going forward

indicates that he has not done so. Although Enax wrote a letter to the IRS, he did

not file a verified administrative claim using the proper tax refund form.

Moreover, to the extent his March 10, 2010 letter was an attempt to file an

administrative claim, it appears to have been untimely given that Enax’s social

security benefits were levied by January 2007, over three years earlier.

      Enax argues that Congress waived sovereign immunity by enacting 26

U.S.C. § 7433, which provides a civil action for “actual, direct economic

damages” resulting from an unauthorized collection action. See 26 U.S.C.

§ 7433(a), (b)(1). The problem for Enax is that his complaint did not seek actual

damages or allege that he had incurred any actual pecuniary losses as a result of

the allegedly improper collection of taxes. See 26 C.F.R. § 301.7433-1(b)

                                          5
(defining “actual, direct economic damages” as “actual pecuniary damages

sustained by the taxpayer as the proximate result of the reckless or intentional, or

negligent, actions” of the IRS).4 Instead, Enax sought to recover those allegedly

improperly collected taxes from his social security benefit, i.e., a tax refund suit.

See 26 U.S.C. § 7422(a) (defining a tax refund suit as one “for the recovery of any

internal revenue tax alleged to have been erroneously or illegally assessed or

collected”); see also 26 C.F.R. § 301.6331-1 (providing authority to IRS district

directors to collect unpaid taxes by levy). Before bringing such a tax refund suit,

Enax was required to exhaust his claim administratively, and his failure to do so

barred the district court from entertaining it.5

       Where the district court lacks subject matter jurisdiction, “it ha[s] no power

to render a judgment on the merits.” Crotwell v. Hockman-Lewis Ltd., 734 F.2d

767, 769 (11th Cir. 1984). Accordingly, we vacate the district court’s judgment

and remand for the district court to dismiss Enax’s complaint for lack of subject

       4
         Enax never asked to amend his complaint to assert a damages claim and does not argue
on appeal that the district court should have allowed him to do so before dismissing his
complaint. See Timson v. Sampson, 518 F.3d 870, 874 (11th Cir. 2008) (stating that issues not
raised in pro se litigant’s brief are abandoned)
       5
         To the extent Enax sought prospective declaratory or injunctive relief, his claims were
barred by the Anti-Injunction Act, 26 U.S.C. § 7421, and the federal tax exemption to the
Declaratory Judgment Act, 28 U.S.C. § 2201(a), and, thus, the district court lacked subject matter
jurisdiction over those claims as well. See Christian Coalition of Fla., Inc. v. United States, 662
F.3d 1182, 1190-94 (11th Cir. 2011).
                                                6
matter jurisdiction.6

      VACATED AND REMANDED.

      6
          Enax’s motion to file a reply brief out of time is granted.
                                                   7