Court Opinion

ID: 8917585
Source: CourtListenerOpinion
Date Created: 2022-11-27 05:43:42.979414+00
Date Added: 2024-06-11T17:09:08.044923
License: Public Domain

DUNIWAY, Circuit Judge
(dissenting):
I dissent.
Our decision in Estate of Lang v. Commissioner, 9 Cir., 1980, 613 F.2d 770, is in point, and we are. required to follow it. Moreover, even if that case were not in point, we should hold that the appellants’ appeal is timely. The majority exalts form over substance, and sets a trap for the unwary.
The five male appellants in this case were, during the years in question, “21 dealers” at the Dunes Casino in Las Vegas, Nevada. They, together with one Keogh, another 21 dealer at the casino, were found by the Commissioner to have failed to report most of the tips or “tokes” that they received from patrons of the casino. Each petitioned the tax court for a redetermination of the deficiency asserted by the Commissioner. Their cases were consolidated on the Commissioner’s motion, which they joined. There was but one trial, and one opinion. The major part of the evidence was received against all of them. It is described in our opinion in Keogh v. C.I.R., 9 Cir., 713 F.2d 496 (1983). That evidence was the determining evidence against each taxpayer. The “Memorandum, Findings of Fact and Opinion” of the tax court is also described in Keogh.
The majority emphasizes the facts that each taxpayer filed a separate petition in the tax court, that the consolidation was “for purposes of trial, briefing and opinion,” that each taxpayer had a separate docket number, that the opinion stated “[decisions will be entered,” and that, all on the same day, six pieces of paper were filed, each bearing a caption containing the name of a taxpayer and of his spouse, if any, and the number assigned to that taxpayer’s petition, each labelled “Decision,” and each showing the deficiency computed against *439that taxpayer. I wonder what the majority would have held if but one paper had been filed, captioned, like the opinion, with the names and docket numbers of all of the taxpayers and spouses, entitled “Decision,” and computing and fixing a deficiency for each taxpayer. Also, would it have made any difference if the opinion had said, “Decision will be entered,” instead of “Decisions will be entered”?
The majority opinion states: “At no point, however, were the taxpayers and the Keoghs joined in one action.” This, to me, is simply not so. I am reminded of the story of the blind men who “saw” the elephant. The part that each touched and felt decided what he said the elephant was. The majority encounters the trunk — the original petitions, and the tail — the final “decisions,” and gives no weight to the body of the beast. Yet that is the heart of the case, the trial — the testimony, the exhibits, the stipulations, the briefs, the arguments, the findings of fact, the conclusions of law. The judgment or “decision” follows from the latter, and its entry is usually a clerical and ministerial matter. From the time of consolidation to the end, this was, for all practical purposes, one case, and all of the taxpayers were parties to it. I think that most litigants, and indeed most lawyers, would think that each taxpayer in the matter was a “party” to a single consolidated proceeding in the tax court.
Section 7483 of 26 U.S.C. provides:
Review of a decision of the Tax Court shall be obtained by filing a notice of appeal with the clerk of the Tax Court within 90 days after the decision of the Tax Court is entered. If a timely notice of appeal is filed by one party, any other party may take an appeal by filing a notice of appeal within 120 days after the decision of the Tax Court is entered.
Here, the crucial sentence of the section is the second. It refers to “one party,” and “any other party.” I would hold that, when the consolidation occurred, all of the taxpayers became parties to the consolidated case, and remained parties thereafter, whether or not the opinion said “decision” or “decisions,” and whether or not there was one paper labelled “decision” or there were six, each labelled “decision.” The majority’s opinion turns the sentence into a trap for the unwary.
My conclusion is supported by our decision in Estate of Lang v. C.I.R., 9 Cir., 1980, 613 F.2d 770 fn. 1, pp. 771-772. There, one taxpayer had filed two petitions in the tax court, one attacking a gift tax deficiency and one attacking an estate tax deficiency. The two were consolidated and tried together, and there was one opinion, and it said “Decision will be entered.” However, the tax court filed two decisions, one in each case. Here is what we said:
Neither § 7483 nor prior Ninth Circuit cases interpreting that statute directly address the problem of a consolidated case for which two “decisions” have been published. Among the factors we have taken into consideration in our application of § 7483 to this novel situation are these: (1) The Tax Court’s opinion did not anticipate two decisions. Rather, it concluded with the order that “Decision will be entered under Rule 155” (emphasis added). (2) The issuance of two “decisions” was specifically requested by the Commissioner. (3) The Commissioner waited until the 88th day to file his estate tax appeal, perhaps deliberately in order to preclude the taxpayer from responding with an appeal of the gift tax issues. (4) The two “decisions” were issued as a paired set on the same day. (5) Except for the separate “decisions,” this case has been treated as a single proceeding in all other respects.
Because the two decisions derive from the same opinion, we do not find that one of them became final and appealable after 90 days when an appeal had been taken from the other before that time. Further appeals of either decision would have been precluded only after 120 days.
In the case at bar, elements (4) and (5) are also present. I decline to believe that we should rest our judgment on whether the opinion said “decision” or “decisions,” or whether the Commissioner asks for two de*440cisions. To do so would be hyper-technical. As to element (3), the language of the crucial second sentence in § 7483 does not make the 120 days inapplicable if the first party appeals, as the Keoghs did, early in the 90 days specified in the first sentence, rather than late, as the Commissioner did in Estate of Lang.
The distinctions drawn by the majority are not valid. One ground is the word “decisions” in the opinion here, and “decision” in Estate of Lang. The other is that in that case the same taxpayer was a party to each case. The first is, as I have said, hypertechnical. The other is immaterial. We should follow Estate of Lang. The majority decision transforms Estate of Lang into Mr. Justice Roberts’ “restricted railroad ticket, good for this day and train only.” Smith v. Allwright, 1944, 321 U.S. 649, 669, 64 S.Ct. 757, 768, 88 L.Ed. 987 (Roberts, J., dissenting). A panel should not treat our own precedents that way. Overruling is the prerogative of the court in banc.
Legislative history also supports my position. When § 7483 was enacted as part of the Internal Revenue Code of 1954, it provided, in pertinent part, that “The decision of the Tax Court may be reviewed ... if a petition ... is filed by either the Secretary ... or the taxpayer within 3 months after the decision is rendered. If, however, a petition ... is so filed by one party to the proceeding, a petition ... may be filed by any other party to the proceeding within 4 months after such decision is rendered.”
The provision was different, however, in the House Bill. House Report No. 1337, March 9, 1954, reprinted at 3 U.S.Code Cong. & Admin.News, 1954, pp. 4017 ff., states, at p. 4582:
§ 7483. Petition for review
This section changes existing law by providing, in case one party to the proceeding files a petition for review that the adverse party is given 1 additional month to file his petition for review.
(Emphasis added). The Senate Report, reprinted at id., pp. 4621 ff., states at p. 5265:
§ 7483. Petition for review
... Your committee has amended the section to provide that if one party to the proceeding files a petition for review, the additional month to file a petition for review will be available to any other party to the proceeding, whether or not an adverse party.
As to this, the Conference Report, House Report No. 2543, July 26, 1954, reprinted at id. 5280 ff., states, at p. 5345: “The House recedes.”
In 1969, § 7483 was amended to its present form by the Tax Reform Act of 1969. The amendment was inserted by the Senate as part of a chapter changing the tax court to an Article I Court. See Senate Report No. 91-552, reprinted at 2 U.S.Code Cong. & Admin.News, 1969, pp. 2027 ff., at page 2340. The Report states (p. 2344):
Changes are made as to time for appeal and terminology in order to conform the code provisions to the Federal Rules of Appellate Procedure. The code provision for appealing from Tax Court decisions within 3 months after entry of decision, is changed to 90 days. In order to resolve a number of cases in which appellate jurisdiction is being challenged because the petition for review was filed within 3 months but after 90 days, the amendments provide that a petition is timely filed if it is filed within either time period. This applies in cases where the Tax Court decision is entered before the thirtieth day after the bill’s enactment. Thereafter, the 90-day rule is to apply.
I find nothing in the Report indicating an intent to make any change except one from 3 or 4 months to 90 or 120 days.
Rule 4(a)(3), F.R.App.P., states: “If a timely notice of appeal is filed by a party, any other party may file a notice of appeal within 14 days .... ” It does not say “party to the case” or “party to the action.” Adding “to the case” or “to the action” would be unnecessary surplusage. The change from “party to the proceeding” to “party” is, as the Report states, “conforming.” See also the Conference Report, No. 91-782, reprinted at id., pp. 2392 ff., at 2457: “(12) Changes are made as to time *441for appeal and terminology in order to conform the code provisions to the Federal Rules of Appellate Procedure;”. No doubt it was felt that “to the proceeding” was unnecessary surplusage. There is no indication that the omission was intended to have the rather astonishing effect that the majority gives to it. We should not narrow the language of § 7483 by a meeching construction of it.
We should proceed to consider the merits. On the merits, I would affirm the tax court for the reasons stated in Keogh, supra.
I dissent.