Court Opinion

ID: 9459843
Source: CourtListenerOpinion
Date Created: 2023-08-04 21:33:01.865516+00
Date Added: 2024-06-11T17:36:21.451868
License: Public Domain

ELY, Circuit Judge
(dissenting) :
I respectfully dissent. In my opinion, the prosecution’s evidence was insufficient to establish, beyond all reasonable doubt, Andro’s guilt of the offense in question.
As early as March 25, 1966, Andros was mailed a letter advising him of the Government’s belief that an income tax deficiency was due and had been assessed. The information was filed on April 7, 1972. It charged, in effect, that Andros had willfully failed to pay the taxes on July 16, 1966. The Government apparently specified the July 16, 1966, date because on that day Andros had won $20,000 from a so-called “5-10” wager on horseracing. The prosecution had also learned that two days thereafter Andros had opened a bank account under an assumed name and deposited the sum of $10,000 therein. As to the law applicable to the offense with which Andros was charged, I quote from the Government’s brief as follows:
“To establish the offense of a willful failure to pay a tax, in violation of Section 7203 of the Internal Revenue Code of 1954, the Government must prove that the accused possessed specific wrongful intent — the purpose to disobey — at the time he did not pay the tax. See Spies v. United States, 317 U.S. 492, 497 [63 S.Ct. 364, 87 L. Ed. 418] (1943); United States v. Palermo, 259 F.2d 872, 882 (C.A.3, 1958); Wilson v. United States, 250 F.2d 312 (C.A.9, 1957); United States v. Goodman, 190 F.Supp. 847, *535851-852 (N.D.Ill., 1961). The element of willfulness must include some element of evil motive and want of justification in view of all the financial circumstances of the taxpayer. Spies v. United States, supra, [317 U.S.,] p. 498 [63 S.Ct. 364]. Mere laxity, careless disregard of the duty imposed by law, or even gross negligence, unattended by evil motive are not probative of the element of willfulness. United States v. Palermo, supra, 259 F.2d, p. 882.” (Footnote omitted.)
I am convinced that the Government did not carry its burden in respect to one element of the offense, i. e., that on July 16, 1966, the financial circumstances of Andros were such that he possessed readily available funds with which to pay his obligations to the Government. Andros offered no evidence in his own defense, but through the cross-examination of prosecution witnesses, it was established that Andros was a gambler, that he had habitually followed the practice of “kiting” checks, that he was overdrawn in one of his bank accounts to the extent of $27,000, overdrawn in other bank accounts to the extent of $35,000, indebted to the extent of $9,100 because of his check kiting activity, indebted to one Alessio in the sum of $23,500, and indebted to a horse racing enterprise, Bay Meadows Race Track, in the amount of $15,000. There was also evidence of other debts owed by Andros, including one of $30,000 that arose from a loan from his mother and which was evidenced by a mortgage. The Government replies that most of Andros’ debts were incurred after July 16, 1966, but it concedes that Andros’ obligation to Bay Meadows Race Track existed on that date.1 It argues, however, that there was no evidence that appellant “was being pressed for payment” of this obligation. This argument taxes my credulity. One need have no special expertise in order to recognize that a debt owed by one gambler to another is a “pressing” obligation.
Having itself established that Andros, on July 16, 1966, owed more money to others that the amount which was then in his possession, the Government did not, and could not, prove beyond a reasonable doubt that Andros was on that date financially able to pay the taxes in question.
Accordingly, I would reverse.

. This concession, as I interpret it, appears on page 28 of the Government’s brief. Also on that page is the admission that evidence as to Andros’ “check kiting” was presented through the testimony of one Maiorana. As to this, the Government’s brief continues, “In fact, however, this activity only resulted in a $9100 debt . ” Finally, the Government, on the same page 28, states: “While there was evidence of a large debt owed to Bay Meadows Race Track . . . . ” and “the evidence established that appellant made but one $1,000 payment on this debt during the relevant period of time charged.” In the light of this, I challenge the majority’s unqualified assertion that the indebtedness of Andros “was not proved.”
I cannot believe that investigators for the Internal Revenue Service were either so inept or so negligent that their verification of Andros’ heavy indebtedness was untrustworthy.