Court Opinion

ID: 8588935
Source: CourtListenerOpinion
Date Created: 2022-11-23 15:42:07.447944+00
Date Added: 2024-06-11T16:54:21.965122
License: Public Domain

Whaley, Chief Justice,
dissenting:
I dissent from the decision of the majority of the court on the ground that this court does not have jurisdiction to review a special assessment determination of the Commissioner. That has been the consistent rule followed by the Supreme Court in all cases which have come before it for consideration. Williamsport Wire Rope Co. v. United States, 277 U. S. 551; Heiner v. Diamond Alkali Co., 288 U. S. 502; and Welch v. Obispo Oil Co., 301 U. S. 190. In these cases the Supreme Court has pointed out that “in this delicate and complex phase of revenue administration” it is beyond the power of the courts to inquire into and disturb these acts of the Commissioner which Congress vested in an administrative agency as the final authority. The decisions of this court have been to the same effect. Central Iron & Steel Co. v. United States, 79 C. Cls. 56; Bradford & Co. v. United States, 79 C. Cls. 89; Michigan Iron & Land Co. v. United States, 81 C. Cls. 330; and Cuban-American Sugar Co. v. United States, 89 C. Cls. 215.
The reason given by the majority for this unusual and exceptional departure from the rule so long established and so consistently followed is that unlawful and wrongful acts *491drove the taxpayer to request special assessment and that it was not done voluntarily. In my view the facts are to the contrary. A controversy arose between the Commissioner and plaintiff over whether plaintiff’s tax liability for 1917 should be determined on the calendar or fiscal-year basis under the provisions of Section 13 (a) of the Eevenue Act of 1916, which was the governing act. Plaintiff filed its returns on the fiscal-year basis, whereas the Commissioner held that since appropriate notice had not been given it should be held to a calendar-year basis. The Commissioner accordingly determined plaintiff’s tax liability for the year 1917 on the latter basis. The facts found by the court show no protest against the annual basis when that final determination was made. What they show is that after the determination plaintiff requested special assessment and, since the determination had been made on the calendar-year basis, the request certainly must have been for a special assessment determination on a calendar-year basis. The Commissioner acceded to plaintiff’s request, granted special assessment, and made his determination accordingly. When that determination was made, plaintiff advised the Commissioner of its satisfaction with the Commissioner’s determination in these words:
The assessment under the relief provisions of the Eevenue Acts of 1917 and 1918 is not contested, but we wish to protest and appeal the rate allowed for the period ended September 30,1918.
We. have in these'facts not only a request for special assessment ■by"'plaintiff, but an acceptance of the results reached for 1917, the year before the court, and only an objection to the comparatives used by the Commissioner for the nine months of 1918. The nine months’ period of 1918 is not before the court.
In addition,' between 1925 and 1929 plaintiff filed two claims for refund, both for the calendar-year 1917 and in neither of these claims was any protest made against the Commissioner’s final determination on a calendar-year basis. It was not until April 25,1929, that we have formal notifica*492tion from plaintiff of its dissatisfaction with the annual basis of the Commissioner’s determination. At that time suit was brought-in the Federal district court for the Western District of South Carolina for the recovery of taxes for the year now before this court, and one of the grounds assigned was that the taxes should have been determined on a fiscal rather than on a calendar-year basis. In deciding that case adversely to plaintiff, the learned Judge Watkins held not only that plaintiff had not properly put the Commissioner on notice of its intention of raising the issue of the accounting basis but also that—
Even if this question could now be raised, it could not avail in this case for the reason that I am unable to find where the corporations subject to this tax had proceeded to acquire any absolute or certain right to have their returns made and audited upon a fiscal year basis. As above stated, the testimony indicates that, because of the custom previously established, it would have been fair to permit this to be done. I fail to find, however, that any previous application was made to or consent given by the Commissioner for a fiscal year accounting during 1917. [56 Fed. (2d) 180,183, 184.]
Under such a state of facts, how it could be said there was any compulsion or arbitrary act on the part of the Commissioner in bringing about the special assessment determination passes my comprehension. In my opinion, the request was made by plaintiff in the ordinary way. Plaintiff accepted that determination and should not now be permitted to' repudiate those acts. That it may have chosen unwisely in 1925 in seeking relief from the Commissioner’s determination under a remedial statute, in which the results turned out differently from what it expected, is not something into which we can inquire at this time. The die was cast when the request was voluntarily made. Certainly more compelling circumstances than have been shown should be presented in order to justify a departure from a rule so well established and a judgment of such magnitude at this late date. In my opinion, the petition should be dismissed for lack of jurisdiction.
*493In the above case (No. 42118) the following order was issued, November 16, 1942:
ORDER
This case comes before the court on defendant’s motion for judgment; and it appearing that on April 6, 1942, the court filed special findings of fact with an opinion holding that plaintiff was entitled to recover, but suspended the entry of judgment to await the filing of a stipulation by the parties showing the amount due plaintiff under the court’s decision; and it further appearing that on October 6,1942, plaintiff filed a motion to dismiss the petition herein, stating that “the plaintiff has been paid”; which motion was allowed November 2, 1942, and the petition dismissed; and it further appearing that on November 13, 1942, the defendant filed a motion for judgment, signed on behalf of the plaintiff by Howe P. Cochran and on behalf of the defendant by Assistant Attorney General Samuel O. Clark, Jr., in which it is stated that: “In conformity with the direction of the court, the parties reached an accord that the refundable overpayment of income tax due plaintiff for 1917 was $65,000, and that interest thereon had accumulated prior to October 1, 1942, in an amount of $35,000,” and that “Inasmuch as both parties waived any right to seek review of the decision of the Court, or the amount of the refund, Treasury check No. 1500139, in the amount of $100,-000 in full satisfaction of plaintiff’s claim was issued September 29, 1942”; and it further appearing from the defendant’s said motion that the claim herein has been paid by Treasury check No. 1500139 issued to plaintiff on September 29, 1942, for the sum ’ of $100,000, being $65,000 principal and $35,000 as interest accumulated thereon prior to October 1, 1942 — now, therefore,
It is ordered this 16th day of November 1942, that an entry be made on the docket of this case that (in the absence of the filing in this court of a stipulation by the parties showing the amount due plaintiff or the filing by either party of a motion for the entry of judgment) “the claim *494herein'having been settled by agreement of the parties and paid by Treasury warrant No. 1500139 for $100,000, as above stated, the defendant’s motion for judgment is overruled.”
By the Court.
Richard S. Whalet,

Chief Justice.