Court Opinion

ID: 4472431
Source: CourtListenerOpinion
Date Created: 2020-01-13 23:25:30.999163+00
Date Added: 2024-06-11T14:50:25.749698
License: Public Domain

Halpern, J., dissenting: I dissent because I am not persuaded that, in the words of the majority, “we should accede to the decision of the three Courts of Appeals and should no longer adhere to the view that the new regulation is invalid.” Majority op. p. 397. The majority sets the stage for acceding in the following terms: The critical difference between us and the Courts of Appeals turns on whether we were correct in our conclusion that the legislative history contained such a clear expression of legislative intent as to justify the conclusion that the regulation in question was unreasonable. * * * [Majority op. p. 394.] The majority then proceeds (1) to reject two criticisms made by the Court of Appeals for the Sixth Circuit of our approach in Pacific First Fed. Sav. Bank v. Commissioner, 94 T.C. 101 (1990), revd. 961 F.2d 800 (9th Cir. 1992), and (2) to express reservations about certain positive arguments made by the Courts of Appeals. Indeed, the majority fails expressly to set forth any positive argument made by any of the Courts of Appeals with which it agrees. The sum and substance of the majority’s reasoning is as follows: Despite our reservations, we feel compelled to recognize that the holdings of three Courts of Appeals, that the new regulation is reasonable, make highly suspect our contrary position based on the implied, as contrasted with the express, intent of Congress. * * * [Majority op. p. 396.] To be sure, the majority makes clear that it is not adopting a rule of statutory construction that disregards implied intent in all cases: “We emphasize, however, that the legislative history of a statutory provision may be so clear that a finding of implied intent on the part of Congress would be in order in a future case involving statutory interpretation.” Majority op. pp. 396-397. Apparently, the majority is suggesting only that implied intent is less relevant to determining the reasonableness of a regulation than it is to a question of straight statutory interpretation. That is a distinction with which I cannot agree. We are a Court of national jurisdiction with expertise in the area of Federal taxes. Since appeals from this Court lie to each of the 12 Courts of Appeals, we face unique problems in dealing with the opinions of Circuit Courts. See, e.g., Lawrence v. Commissioner, 27 T.C. 713 (1957), revd. 258 F.2d 562 (9th Cir. 1958); Golsen v. Commissioner, 54 T.C. 742 (1970), affd. 445 F.2d 985 (10th Cir. 1971); Lardas v. Commissioner, 99 T.C. 490 (1992). We have, since Lawrence, backed off from the position taken therein, that, while certainly we should seriously consider the reasoning of a Court of Appeals that had reversed one of our decisions, we ought not to follow the Court of Appeals’ decision if we believe it to be incorrect: if still of the opinion that its original result was right, a court of national jurisdiction to avoid confusion should follow its own honest beliefs until the Supreme Court decides the point. The Tax Court early concluded that it should decide all cases as it thought right. [Lawrence v. Commissioner, supra at 716-717; fn. refs, omitted.] We have backed off to the extent that, in Golsen v. Commissioner, supra, we created a narrow exception to the Lawrence doctrine. Where a reversal would appear inevitable, due to the clearly established position of the Court of Appeals to which an appeal would lie, our obligation as a national Court does not require a futile and wasteful insistence on our view. Golsen v. Commissioner, 54 T.C. 742, 757. Accordingly, in that narrow circumstance, although we still think the result wrong, we will follow that Court of Appeals. Compare Golsen v. Commissioner, supra (Golsen doctrine established) with Lardas v. Commissioner, supra (Golsen doctrine inapplicable). This is not a case governed by the Golsen doctrine. In Lawrence v. Commissioner, supra at 717, we also stated: The Tax Court and its individual Judges have always had respect for the * * * [12] Courts of Appeals, have had no desire to ignore or lightly regard any decisions of those courts and have carefully considered all suggestions of those courts. The Tax Court not infrequently has been persuaded by the reasoning of opinions of those courts to change its views on various questions being litigated. [Citations omitted.] I am unconvinced that the majority is persuaded by the reasoning of the Courts of Appeals for the Sixth, Seventh, and Ninth. Circuits. Indeed, the majority seems to cite with approval my necessarily contrary analysis in Georgia Fed. Bank v. Commissioner, 98 T.C. 105 (1992), vacated and remanded per agreement of the parties (11th Cir., July 12, 1994): In Georgia Federal Bank v. Commissioner, 98 T.C. at 119-120, Judge Halpern, in a concurring opinion, explained that our decision in Pacific First had not been based on the reenactment doctrine, but on the view that the amendment to section 593 in 1969 and the accompanying legislative history necessarily reflected contemporaneous congressional intent that taxable income be computed for this purpose without taking NOL’s into account. * * * [Majority op. p. 395; emphasis added.] The majority has failed to convince me that we should not abide by our previous holdings. Besides the fact that three Courts of Appeals disagree with it, what precisely is wrong with our conclusion that the implicit intent of Congress makes unreasonable the new regulation? The majority quotes a comment made by the Court of Appeals for the Ninth Circuit: “ ‘in the realm of national tax law, “it is more important that the applicable rule of law be settled than it be settled right.””’ Majority op. p. 394. Although I do not necessarily reject that approach in all cases, I am unpersuaded that it is an appropriate approach here. I believe that, as a general rule, we should practice what we preached in Lawrence v. Commissioner, supra. We should follow our own honest beliefs until the Supreme Court decides the point. Id. at 716-717. To quote: “The Tax Court early concluded that it should decide all cases as it thought right.” Id. at 717. What we thought right is set forth in Georgia Fed. Bank v. Commissioner, supra, and Pacific First Fed. Sav. Bank v. Commissioner, supra. We should follow those decisions. Wells, J., agrees with this dissent.