Double
Jeopardy
7205-
Fraudulent Withholding Exemption Certificate: Double
Jeopardy
[78-2 USTC ¶9722]
United States of America
, Plaintiff-Appellee v. Robert D. Horn, Jr. and Peggy P. Horn,
Defendants-Appellants
(CA-10),
U. S. Court of Appeals, 10th Circuit, Nos. 78-1506, 78-1507, 583 F2d
1124,
9/6/78
, Reversing and remanding unreported District Court decision
[Code Sec. 7205]
Criminal penalties: Withholding exemption certificates, fraudulently
made: Double jeopardy: Mistrial.--In a trial of charges of
submitting false exemption statements to employers the trial court
failed to inquire of the jury as to the state of its deliberations so
that a declaration of mistrial by the trial court was improvidently
granted. The trial court was not justified in discharging the jury.
Further trial for the same offense was barred under the doctrine of
double jeopardy.
Larry D.
Patton, United States Attorney, William S. Price, Assistant United
States Attorney, Oklahoma City, Oklahoma 73120, for plaintiff-appellee.
Gary James Joslin, for defendants-appellants.
Before
HOLLOWAY, DOYLE and MCKAY, Circuit Judges.
DOYLE, Circuit
Judge:
The
defendants, husband and wife, were charged in separate counts of an
indictment with the offense of submitting false exemption statements to
employers, contrary to 26 U. S. C. §7205. In the Robert D. Horn, Jr.
indictment, it was alleged that on
April 12, 1977
, he was employed by Horn Seed Company, Inc., and was required by the
Internal Revenue laws to furnish Horn Seed Company, Inc. with a signed
withholding allowance or exemption certificate relating to the number of
withholding allowances or exemptions claimed on or about the date of the
commencement of employment by Horn Seed Company, Inc., and that he did
willfully submit a false exemption from a withholding statement claiming
that he had incurred no income tax liability for the year 1976; and that
he anticipated no taxable income in 1977. The further allegation was
that he had incurred liability for federal income tax for 1976, and he
anticipated that he would incur liability for 1977, in violation of §7205,
Internal Revenue Code.
The Peggy P.
Horn indictment is substantially the same as that which charged Robert
D. Horn, Jr., except that she was an employee of Kerr-McGee Corporation.
She too was alleged to have violated §7205, Internal Revenue Code,
based upon her alleged false statement that she had incurred no
liability for taxes in 1976 when, in fact, she had, and that she did not
anticipate having tax liability in 1977 when, in fact, she anticipated
that she would.
This is an
interlocutory appeal from a judgment of the district court, which
declared a mistrial following the court's decision that the jury was
unable to agree on a verdict.
On May 18,
1978, the jury was selected and a trial was had as to both defendants.
On May 19, at 5:30 p. m., the case was submitted to the jury. At about
7:00 p. m., the jury sent a note to the jury inquiring about a civil
suit which the Horns had brought. There had been some evidence regarding
this during the trial because it had to do with the tax matters in the
cause being tried. The court answered the questions and furnished to the
jury certain exhibits which it had requested. Deliberations continued,
but at 7:30 the jury sent a note asking for clarification of an
instruction which seemed somewhat at variance with the indictment. The
court clarified this and again the jury resumed deliberations. However,
at 8:57 p. m., the jury sent in a note signed by the foreman stating:
"The jury appears to be deadlocked." The judge brought the
jurors into the courtroom and told them that he intended to declare a
recess for the night. The jurors were instructed to return at 9:00 the
next morning in order to resume deliberations. The next morning, when
the jury appeared, the court discussed the note and in the course of
this said that they had deliberated something like three hours and that
the court did not consider this to be sufficient time to (fully)
consider the matter. He then reread the last paragraph of the
instruction submitted. This told the jury that its verdict must be
unanimous and reminded them of their duty to consult with one another
and of their duty to reach an agreement if agreement is possible
"without violence to individual judgment." The court continued
that each juror must decide the case on an individual basis, but only
after an impartial consideration of the evidence. They were also told to
reexamine their views and that they should not hesitate to change their
opinions if convinced that their opinions were wrong, but that "no
juror should surrender his or her honest conviction as to the weight or
effect of the evidence solely because of the opinion of fellow jurors or
for the mere purpose of returning a verdict." After that the court
proceeded to give a more formal Allen charge. He also answered the
question that had been submitted regarding the civil suit relating to
the criminal case which apparently had been filed by the defendants. The
court told the jury that the suit had been dismissed and added "so
if that is bothering you, if you think that case is going to decide the
issues here you can put it out of your mind because that case, the
defendants lost it and here is the order right here in Case No.
C-77-1111-C." The judge concluded: "So you Ladies and
Gentlemen go into the jury room now with a spirit of adhering to the law
and to the evidence in the case and see if you cannot reach a
verdict."
At 10:40 a.
m., that is after the jury had deliberated for somewhat more than an
hour, they were brought back into court. Without ceremony, the judge
announced:
I am now going
to do what I should have done last evening when I received your note
that you were deadlocked. I perhaps should have at that time declared a
mistrial but I thought maybe going home and sleeping upon it, being a
little fresher this morning and may be you might break the deadlock but
you have been out an hour this morning and have not so I am going to
declare a mistrial . . ..
There was no
inquiry of the foreman or of individual jurors whether it was a
consensus of the jury that they had made progress. Nor did the judge
inquire whether the members expected to reach a verdict. Instead the
court sua sponte declared a mistrial. The court, as the jury was
discharged, stated that the cause would be set down for trial
immediately. However, the district court later granted a stay of
proceedings so that the case could be appealed. This court ruled that
the cause was a proper one for immediate appeal.
Appellants'
contention is that the "mistrial" results in a final judgment
of dismissal, which bars further trial for the same offense.
*
* *
The question
which we must now decide is whether in the light of the facts and the
applicable law, the trial court was justified in discharging the jury.
The ultimate or eventual issue is whether the failure of the court to
inquire of the jury as to the state of their deliberations, considered
with the remainder of the record, calls for a judgment that the mistrial
was improvidently granted.
The argument
advanced is that there was a lack of "manifest necessity" for
declaring a mistrial sua sponte; that the court was required to
take steps to ascertain and demonstrate clearly that it was at the time
of granting the mistrial impossible for the jury to reach a verdict.
United States
v. Perez, 9 Wheat. 579 (1824); Arizona v. Washington, 98
S. Ct. 824 (1978); and United States v. Jorn [71-1 USTC ¶9172],
400
U. S.
470 (1971). The further argument is that having failed to take any
affirmative steps, a second trial was and is barred by the double
jeopardy clause of the Fifth Amendment.
In the trial
court's written order it stated that "It is clear from Perez, the
very fact that a jury is unable to agree upon a verdict, satisfies the
requirement of manifest necessity and the declaration of a mistrial does
not bar future prosecution. United States v. Goldstein [73-1 USTC
¶9470], 479 F. 2d 1061 (2d Cir. 1973), cert. denied, 414
U. S.
873 (1973)." Unquestionably, if a jury is unable to agree upon a
verdict, the trial court is justified in declaring a mistrial. The
question is whether the judge can conclude that the jury is unable to
reach a verdict without making inquiry, which objectively shows that
such is the situation.
*
* *
The place of
beginning a consideration of the case law is the 1824 decision of the
Supreme Court in
United States
v. Perez, supra. The succinct and precise opinion in that case
states that the courts have authority to discharge a jury from giving a
verdict, "whenever, in their opinion, taking all of the
circumstances into consideration, there is a manifest necessity for the
act, or the ends of justice would otherwise be defeated." The Court
further explains that: "They are to exercise a sound discretion on
the subject; and it is impossible to define all the circumstances, which
would render it proper to interfere."
The most
recent and most significant discussion of the subject is that found in
Arizona
v.
Washington
, supra. Although it was not a jury disagreement case, it
nevertheless considered whether the trial court was correct in its grant
of a mistrial motion at the behest of the district attorney, where
defense counsel in a murder case had sought to go outside the record and
tell the jury about the improper withholding of evidence by the district
attorney in the prior trial, which withholding had led to the reversal
of the previous conviction. The Supreme Court construed the words
"manifest necessity", saying:
The
words "manifest necessity" appropriately characterize the
magnitude of the prosecutor's burden. For that reason Mr. Justice
Story's classic formulation of the test has been quoted over and over
again to provide guidance in the decision of a wide variety of cases.
Nevertheless, those words do not describe a standard that can be applied
mechanically or without attention to the particular problem confronting
the trial judge. Indeed, it is manifest that the key word
"necessity" cannot be interpreted literally; instead, contrary
to the teaching of Webster, we assume that there are degrees of
necessity and we require a "high degree" before concluding
that a mistrial is appropriate.
98
S. Ct.
at 830-31.
The Supreme Court added that the strictest scrutiny is appropriate when
the basis for the mistrial is the unavailability of critical prosecution
evidence, or when there is reason to believe that the prosecutor is
using the superior resources of the state. At the other extreme, the
Court said, is the mistrial premised upon the trial court's belief that
the jury is unable to reach a verdict, long considered the classic basis
for a proper mistrial. Mr. Justice Stevens added that the argument that
a jury's inability to agree establishes reasonable doubt as to the
defendant's guilt has been uniformly rejected, but that the courts have
held that the trial judge may discharge a genuinely deadlocked jury and
require the defendant to submit to a second trial. If the court,
however, discharges the jury when further deliberations may produce a
fair verdict, the defendant is deprived of his right to have his trial
completed by a particular tribunal. If, on the other hand, the court
fails to discharge a jury which is unable to reach a verdict after
protracted and exhausting deliberations, there is a risk that a verdict
may result from pressure. The appellate court, it was pointed out, must
also exercise are in such a case to avoid condemning the action of the
trial court in granting a mistrial simply because it disagrees with his
conclusion; that the trial court's decision during the trial that the
jury is deadlocked is given great deference by the reviewing court.
In
Arizona
v.
Washington
, supra, it was concluded that the trial court acted properly in
granting the mistrial following the prejudicial statement of the defense
attorney.
The Fifth
Circuit in United States v. Gordy, 526 F. 2d 631 (5th Cir. 1976),
lists criteria for determining whether there was manifest necessity: First,
the length of the trial; second, the complexity; and, third,
the statement from the jury that it is hopelessly deadlocked. The court
pointed out that the present inability of the jury to agree is not the
problem. Rather, the question is whether such an agreement is possible.
The Fifth Circuit concluded that the court's communications with the
jurors prior to discharge were inconclusive and failed to demonstrate
manifest necessity for termination of the trial. The record failed to
demonstrate that the panel members felt that no verdict could be reached
given more time. It was observed that the trial was one in which the
judge was anxious to terminate the proceedings in order to depart
El Paso
(where the trial was taking place). Because of the lack of certinty that
a verdict could not be reached, the court concluded that manifest
necessity was not present.
In Arnold
v. McCarthy, 566 F. 2d 1377 (9th Cir. 1978), the Ninth Circuit said
that the trial court had not abused its discretion in finding that the
jury was hopelessly deadlocked because manifest necessity was there
present. The court through Judge Carter listed seven criteria:
(1) a timely
objection by defendant, (2) the jury's collective opinion that it cannot
agree, (3) the length of the deliberations of the jury, (4) the length
of the trial, (5) the complexity of the issues presented to the jury,
(6) any proper communications which the judge has had with the jury, and
(7) the effects of possible exhaustion and the impact which coercion of
further deliberations might have on the verdict.
It
then held that there was adequate support for the trial judge's
determination that the jury was hopelessly deadlocked:
The most
critical factor is the jury's own statement that it was unable to reach
a verdict.
United States
v. See, supra at 851. Upon receiving a communication from the jury
stating that it cannot agree, the trial court must question the jury to
determine independently whether further deliberations might overcome the
deadlock. * * * Merely questioning the jury foreman may not be
sufficient, but this circuit has recently held that questioning the
foreman individually and the jury either individually or as a group is
satisfactory.
United States
v. See, supra, at 851. At trial below the judge asked the
foreman himself and the jury as a group whether they felt there was a
reasonable probability of reaching a verdict. Only one juror felt there
was. (Emphasis supplied).
566
F. 2d at 1387.
In United
States ex rel Russo v. Superior Court, 483 F. 2d 7 (3d Cir.), cert.
denied, 414 U. S. 1023 (1973), it was ruled that retrial was barred
where the trial court had declared a mistrial sua sponte
following 15 hours of deliberation, because he considered the jury
exhausted, but had not inquired about their physical condition or had
not asked of progress they had made toward a verdict.
In
United States
ex rel Webb v. Court of Common Pleas, 516 F. 2d 1034 (3d Cir.
1975), there had been two previous trials which had ended in mistrials.
After six hours of deliberation the court called the jury back and asked
the foreman whether there was any hope of a verdict. The response was
that he believed not. Since there had not been any solicitation of the
other jurors' views and in view of the fact that all of the proceedings
were perfunctory and in view of the relative shortness of the
deliberations (six and one-half hours), the Third Circuit in an opinion
by Judge Adams concluded that the action of the district court declaring
a mistrial was invalid. Two factors governed. The shortness of the
deliberations and the failure to conduct more detailed questioning as to
whether the jury believed that it was unable to agree, together with the
failure to question anyone except the foreman.
The Second
Circuit case of United States v. Beckerman, 516 F. 2d 905 (2d
Cir. 1975), bears some resemblance to our case, but is, at the same
time, significantly different. There the defendant was charged with
possession with intent to distribute 28 grams of cocaine. Following a
three-day trial, the jury was dismissed without reaching a verdict after
the forewoman reported a deadlock. Defendant's motion to dismiss on the
ground of double jeopardy was denied by the United States District Court
for the Southern District of New York. The jury had deliberated seven
hours on the single charge following a short trial. At the end of that
period of time the jury reported that it was deadlocked and the jury
forewoman stated that more time would not enable the jury to reach a
verdict. Also, the defendant did not object to granting a mistrial. The
court in that case brought the jury into the courtroom and read the note
and asked whether that meant that they were unable to reach a verdict;
"whether you feel with a little more time you might be able to
reach a verdict." It was after the jury responded negatively that
the court declared a mistrial. Judge Motley, the trial judge, had given
a modified Allen charge in her original instructions. A request
was made by counsel for the government that the court give the jury a
regular Allen charge when they had reported by note their
inability to agree. She refused to do this.
If the trial
judge in this case had followed the same line, that is, had called the
jury into the courtroom and had inquired of it what progress, if any,
had been made, and whether there was a possibility that the jury could
reach a verdict, and if the jury had reported that there existed no
apparent possibility, there would be something in the record on which to
base a conclusion that there was manifest necessity for the declaring of
a mistrial. As it now stands, there is virtually a complete lack of
evidence of deadlock as of the time that the mistrial was granted. And
there is a dearth of evidence as to the jury's inability thereafter to
reach a verdict. On the other hand, in Beckerman, the inability
to reach a verdict at the time of the inquiry and with further
deliberation was the point on which the Second Circuit focused its
attention in concluding that the action of the trial court in declaring
the mistrial was a proper discharge of its vested authority.
One other case
must be considered and that is United States v. Gunter, 546 F. 2d
861 (10th Cir. 1976), cert. denied, 430
U. S.
947 (1977). There the jury was unable to agree in the first trial. It
was discharged and a mistrial was declared without objection. A second
trial was held and there two of the defendants were found guilty and the
six remaining defendants received an order declaring a mistrial due to
an inability of the jurors to agree upon the verdict as to them. At the
time there was no objection on the part of the defense to the discharge
of the jury. Following conviction in the third trial, however, the
contention was advanced that the court had erred in declaring the second
mistrial. This court concluded that the defense of double jeopardy was
unavailable. The exact facts are not reported in the opinion. It does,
however, appear in the court's opinion that the jury clearly indicated
to the trial judge that the members of the jury were in irreconciable
conflict as to the six defendants. The big issue on appeal was not so
much that the trial court had been justified in the second trial in
declaring a mistrial as it was whether it was error to try the
defendants a third time. Seemingly, the court was satisfied with the
record made as to the irreconcilable state of things at the time of
granting the mistrial.
In the case at
bar there is a complete lack of evidence that the jury was in
disagreement at the time that the mistrial was granted. It is true that
the night before mistrial was declared the jury had sent in a note
saying that it was unable to agree. What the situation was the next
morning when they returned, and after the Allen charge was given,
we do not know, because there was no inquiry as to what the situation
was. Had the court, following the one-hour plus deliberation, called the
jurors back into court and made an inquiry as to their progress, and had
it asked whether they were close to a verdict, or, if deadlocked,
whether all members of the jury agreed that this was the situation, then
there would have been a good basis for arguing that manifest necessity
existed. The term "manifest" suggests apparent or that which
is clear and which requires no proof, that which is open, palpable,
incontrovertible. It is synonymous with evident, visible or plain. See 2
Bouvier's Law Dictionary, at 2083. It definitely does not mean
something which exists only in the mind of the judge.
Also, the
sending of the note by the foreman the night before fails to establish
manifest necessity the next morning following an hour plus of
deliberation, because the state of jury deliberation is not unchanging.
When we consider also that the trial court acted sua sponte
following relatively short (in time) deliberations, we are unable to
uphold the decision granting the mistrial. We do add, however, that we
have no doubt as to the good faith belief of the trial judge that the
jury was deadlocked. Regardless of this, we must hold that this was
insufficient.
Being of the
opinion that the trial court's ruling is at odds with the decision of
the Supreme Court and of the courts of appeal which have been mentioned,
we are constrained to reverse the judgment of the trial court which
denied the motion to dismiss asserting double jeopardy. Accordingly, the
cause is reversed and remanded for further proceedings consistent with
the view expressed herein.
[85-1 USTC ¶9241]
United States of America
, Appellee v. Edgar L. Shields, Appellant
(CA-8),
U. S. Court of Appeals, 8th Circuit, No. 84-1364, 751 F2d 247,
12/27/84
, Vac'g and rem'g the unreported decision of the district court
[Code Secs. 7203 and 7205]
Criminal penalties: Probation revoked: Withholding exemption
certificates, fraudulently made.--The revocation of the taxpayer's
probation, to the extent that it was based on his failure to file income
tax returns for the years 1978, 1979, and 1980, was not supported by any
evidence in the record. The government introduced no evidence of the
taxpayer's income, and absent evidence of the taxpayer's income, there
was no way to tell whether he was required to file a return or not.
However, the court rejected the taxpayer's claim that revocation of
probation for his failure to file a 1977 return was a violation of the
Double Jeopardy Clause of the Fifth Amendment. Although the taxpayer
could not be prosecuted again for failure to file the return, the return
was still required by law to be filed, and failure to obey a probation
officer's instruction that it be filed was a separate act justifying
additional punishment. In addition, the record did contain sufficient
evidence to justify a finding that returns were required for the years
1976 and 1977. BACK REFERENCES: 85FED ¶5709.133 and 85FED ¶5711A.21.
Larry D. Hale,
Assistant United States Attorney,
St. Louis
,
Mo.
, for appellee. Richard A. Ahrens, Lewis & Rice,
611 Olive St.
,
St. Louis
,
Mo.
63101
, for appellant.
Before ARNOLD,
Circuit Judge, HENLEY, Senior Circuit Judge, and GIBSON, Circuit Judge.
ARNOLD,
Circuit Judge:
Edgar L.
Shields appeals from the District Court's revocation of his probation
for failure to file incometax returns. Because revocation was not
supported by evidence in respect of three of the five asserted
violations, we vacate the judgment and remand the case to the District
Court.
I.
In 1980,
Shields was convicted for failure to file a federal income-tax return
for 1977, a violation of 26
U. S.
C. §7203 (1976), and for filing a false withholding certificate with
his employer, a violation of 26
U. S.
C. §7205 (1976). 1
On the first count Shields was sentenced to one year's imprisonment, and
on the second count he was given three years of probation, following
service of his sentence on Count I. The general conditions of probation
required him to follow his probation officer's instructions. A special
condition of probation required Shields to file all correct income-tax
returns and forms required by income-tax laws, and to pay all taxes
determined to be owed during the period of probation. We affirmed the
conviction and sentence on direct appeal. United States v. Shields
[81-1 USTC ¶9294], 642 F. 2d 230 (8th Cir.) cert. denied, 454
U. S.
848 (1981).
During the
probationary period, Shields's probation officer instructed him to file
all "required" income-tax returns for the years 1976, 1977,
1978, 1979, and 1980. Shields refused to file returns. A
probation-revocation hearing was held, and his probation was revoked.
The District Court then sentenced Shields to one additional year in
prison.
Shields first
argues that there was a failure of proof at his revocation hearing. The
government proved only that he failed to file returns for the five years
in question. It introduced no evidence of Shields's income. Only those
persons with gross income above a certain level are required by law to
file returns. 26 U. S. C. §6012. Absent evidence of Shields' income,
there is no way to tell whether he was required to file a return or not.
The government replies that Shields unquestionably filed no returns. He
therefore, it is argued, violated the probation officer's instructions
and the condition of his probation.
We agree with
Shields on this point. The instruction he allegedly violated directed
him not simply to file returns, but to file "required"
returns. If no returns were required, his failure to file is not a
violation.
The government
has the burden of persuasion in a probation-revocation hearing to show
that the probationer's conduct has not met the conditions of probation. Schneider
v. Housewright, 668 F. 2d 366, 368 (8th Cir. 1981). The government
failed to offer any evidence at the hearing that Shields was obligated
by law to file the returns. The government failed to meet its burden of
persuasion, and revocation of probation was not proper for the failure
to file returns for 1978, 1979, and 1980. 2
The government did show, however, at the original trial that Shields's
income for the years 1976 and 1977 was sufficient to require that
returns be filed. The evidence is therefore sufficient to support
revocation of probation for the failure to file returns for these two
years.
Perhaps the
government could have shown that Shields had a sufficient gross income
for the last three years in question. We are morally certain that
Shields would have refused to file returns whatever his income might
have been. He contends that his earnings are not "dollars,"
and that the federal income-tax law is unconstitutional. These arguments
are frivolous, as we have held many times. But if punishment is to be
imposed, there must be proof of guilt, and in this record there is no
proof that returns were required for 1978, 1979, or 1980.
II.
Shields also
argues that since he has already served one year in prison for failure
to file a return for 1977, revocation of probation for the failure to
file this return is double jeopardy. We do not agree. Even though
Shields cannot be prosecuted again for failure to file the return, the
return is still required by law to be filed, and failure to obey a
probation officer's instruction that it be filed is a separate act
justifying additional punishment.
In United
States v. Alarik, 439 F. 2d 1349 (8th Cir. 1971), the defendant was
convicted for refusing to register for the draft and was placed on
probation for three years. A special condition of probation required
that the defendant register for the draft. The defendant failed to
register, his probation was revoked, and he was sentenced to two years'
imprisonment. The defendant argued that since he could not be prosecuted
again for failure to register, the special probation condition was
improper. This Court held the condition was not improper. "Because
under normal circumstances a defendant could not be prosecuted for
failure to perform an act does not make that act an illegal condition of
probation."
Id.
at 1351. The same reasoning applies here. Shields was bound to obey the
instructions of the probation officer, and he did not do so for the
years 1976 and 1977. 3
In United
States v. Drinkall, No. 84-1240, slip op. at 4 (8th Cir.
Nov. 26, 1984
), this Court held that, although probation could not be revoked for
unlawful conduct which occurred before conviction, failure to notify the
Social Security Administration of remarriage was a continuing
misrepresentation of marital status and was a proper ground for
revocation of probation. When a legal obligation to perform an act
exists both prior to conviction and during probation, and the omission
continues, revocation of probation is proper.
III.
In sum, we
hold that the revocation of Shields' probation, to the extent that it
was based on his failure to file income tax returns for the years 1978,
1979, and 1980, was not supported by any evidence in this record. We
reject Shields' claim that revocation of probation for his failure to
file a 1977 return is a violation of the Double Jeopardy Clause of the
Fifth Amendment. In addition, the record does contain sufficient
evidence to justify a finding that returns were required for the years
1976 and 1977. 4
The judgment
of the District Court, revoking Shields' probation and sentencing him to
one year's additional imprisonment, is vacated. The cause is remanded to
the District Court for it to reconsider whether probation should be
revoked and, if so, what punishment should be imposed. 5
We note that Shields has been in prison pursuant to the District Court's
revocation of his probation since
February 1, 1984
. His term is about to expire, and for this reason the District Court
may decide, assuming it remains of the view that probation was properly
revoked, that the time Shields has served is sufficient. Because of the
shortness of time, we direct that our mandate issue forthwith, and we
ask the District Court to conduct the further proceedings contemplated
by this opinion as soon as practicable.
Vacated and
remanded.
1
The certificate falsely stated that Shields had incurred no liability
for federal income taxes for 1976 and that he anticipated he would incur
no liability for federal income taxes in 1977.
2
Shields's probation was revoked for the failure to file tax returns, not
for the failure to pay taxes. We are not concerned, therefore, with the
restitution provision in the probation statute, 18
U. S.
C. §3651 (1982).
3
An analogous situation exists under the probation restitution statute,
18 U. S. C. §3651 (1982), which provides that as a condition of
probation the defendant may be required to make restitution for actual
damages or loss caused by the offense for which he was convicted. A
defendant convicted of tax evasion may be required, as a condition of
probation, to pay taxes owed, so long as the amount has been properly
determined. If he fails to pay, probation may be revoked and additional
punishment imposed, even if time has already been served for evading the
same taxes. Breach of the condition of probation is not, in the eyes of
the law, the "same offence" as the underlying conviction, in
this situation. But cf. United States v. Green, 735 F. 2d 1203,
1205 (9th Cir. 1984) (restitution may not be required of back taxes for
years other than those involved in the conviction).
4
Shields also argues that the District Court impermissibly delegated to
the probation officers the right to set conditions of probation, and
that the instructions he received to file tax returns were invalid
because they came from an officer in St. Louis, where defendant was
convicted, rather than from the probation office in Wichita, Kansas, to
which supervision of his case had been transferred. We reject those
arguments without further discussion.
5
On remand, it will not be open to the government to attempt to show what
Shields's income was for 1978, 1979, and 1980. A hearing has been held,
and we have determined that the evidence presented at this hearing was
insufficient to meet the government's burden of proof on this issue. The
Double Jeopardy Clause forbids giving the government another chance at
this point. Cf. Burks v. United States, 437 U. S. 1 (1978) (once
a reviewing court has found the evidence insufficient to sustain a
jury's verdict of guilty, the Double Jeopardy Clause precludes a second
trial, and judgment of acquittal must be entered).
[86-1 USTC ¶9327]
United States of America
, Plaintiff-Appellee v. James Foster, Defendant-Appellant
(CA-7),
U.S. Court of Appeals, 7th Circuit, 85-1925,
4/10/86
, 789 F2d 457, Affirming unreported District Court decision
[Code Secs. 7201 ,
7203 and 7205
]
Crimes: Failure to file returns: Evasion of tax: False withholding
exemption certificate: Convictions: Double jeopardy.--Convictions
for willfully failing to file returns, willfully attempting to evade
tax, and willfully filing a false employee's withholding allowance
certificate were sustained. Considering that each of the offenses
provided in Code Secs.
7201 , 7203 and 7205
requires proof of a different element, the court concluded that the
convictions under such Code sections did not violate the Fifth Amendment
double jeopardy provision barring cumulative punishments for the same
offense. Arguments that the individual did not act willfully and that
the Sixteenth Amendment was not properly enacted were rejected.
Anton R.
Valukas, United States Attorney, Joan Bainbridge Safford, Assistant
United States Attorney, Chicago, Ill. 60604, for plaintiff-appellee.
Andrew B. Spiegel, 77 W.
Washington St.
,
Chicago
,
Ill.
60602
, for defendant-appellant.
Before
CUMMINGS, Chief Judge,
CUDAHY
, Circuit Judge, and ESCHBACH, Senior Circuit Judge.
CUDAHY
, Circuit Judge:
Defendant
James Foster appeals his conviction on four counts of willfully failing
to file an income tax return, in violation of 26 U.S.C. §7203
; two counts of willfully attempting to evade income taxes, in
violation of 26 U.S.C. §7201
; and one count of willfully filing a false employee's withholding
allowance certificate, in violation of 26 U.S.C. §7205
. We affirm.
Before 1979
James Foster filed yearly income tax returns, although in 1977 and 1978
he did not pay the full amount of tax due. For the years 1979, 1980,
1981 and 1982, he filed no tax returns, although he was employed at that
time at Will-DuPage Service Co., in
Wheaton
,
Illinois
and was collecting disability pension benefits from the Village of Oak
Brook, Illinois, where he had previously been employed as a policeman.
When he went
to work for Will-DuPage Foster filed an employee's withholding allowance
certificate ("W-4 form"), properly claiming two allowances.
(He was married at that time.) On
January 1, 1981
, he filed a new--and false--W-4 form with Will-DuPage, claiming an
exemption from withholding on the grounds that he did not owe any
federal tax in 1980 and did not expect to owe any in 1981. In September
1981 the Internal Revenue Service (the "IRS") notified
Will-DuPage that Foster's 1981 W-4 form was incorrect and instructed it
to start withholding tax on the basis of one allowance. (Foster was
divorced from his wife that month.) Will-DuPage withheld as directed.
Foster wrote to his employer with instructions to stop withholding. He
wrote his employer another letter in February 1982, denying that he had
any tax liability and again demanding that the withholding stop. Two
days later he filed another false W-4 form, claiming exemption from
withholding on the basis that he owed no federal tax for 1981. On
instructions from the IRS, Will-DuPage stopped withholding.
In January
1985 a grand jury indicted Foster for willfully failing to file income
tax returns in 1979, 1980, 1981 and 1982; willfully attempting to evade
income taxes in 1981 and 1982; and willfully filing a false W-4 form in
1982. Foster, appearing pro se, waived trial by a jury and presented no
defense at his trial before the district judge. He was found guilty on
all counts, the judge finding that he had known that he was required to
file income tax returns and failed to do so; that he had filed false W-4
forms knowing them to be false; and that his overall purpose had been to
evade taxes. Transcript of Proceedings (March 25, 1985), at 156-57.
At the
sentencing hearing, Foster was represented by counsel. He was sentenced
to eighteen months' imprisonment: six months on Count One (failure to
file in 1979); twelve months on Count Two (failure to file in 1980), to
run consecutively to Count One; eighteen months on Count Three
(attempted tax evasion in 1981), to run concurrently with Counts One and
Two; twelve months on Count Four (failure to file for 1981), to run
consecutively to Count One but concurrently with Counts Two and Three.
Sentence was suspended on Counts Five through Seven (attempted tax
evasion for 1982, failure to file in 1982, filing a false W-4 form in
1982).
Foster raises
three arguments on appeal: (1) that conviction for both the misdemeanors
of failure to file and of filing a false W-4 form and the felony of
attempted tax evasion for the years 1981 and 1982 violated the double
jeopardy clause of the Fifth Amendment; (2) that the evidence was
insufficient to establish the mental state necessary for a conviction on
any count; and (3) that the prosecution was void ab initio
because the Sixteenth Amendment to the federal Constitution was never
properly ratified.
Foster argues
that his convictions for both the §7201
felony and the §7303 and
§7305 misdemeanors violated the double jeopardy clause. A violation of
26 U.S.C. §7201 1
requires proof of the following elements: (1) the existence of a tax
deficiency; (2) an affirmative act constituting an evasion or attempted
evasion of the tax; and (3) willfullness. Sansone v. United States
[65-1 USTC
¶9307 ], 380 U.S. 343, 351 (1965). In support of its assertion that
Foster attempted to evade taxes in 1981, the government offered evidence
that he (1) failed to file an income tax return for that year; (2) filed
a false W-4 form with his employer for that year; and (3) directed
correspondence to his employer in late 1981 instructing him to honor his
W-4 form and stop withholding. For the 1982 violation of §7201
, the government offered evidence that Foster (1) failed to file a
tax return in 1982; (2) directed correspondence to his employer in early
1982 instructing him to stop withholding; (3) filed a false W-4 form
with his employer in 1982. Because he was convicted of the misdemeanors
of failure to file and filing false W-4 forms as well as the tax evasion
felonies for 1981 and 1982, Foster contends that his Fifth Amendment
protection against "cummulative punishments for the same
offense" has been violated.
In its recent
opinion in Garrett v. United States, 105 S.Ct. 2407 (1985), the
Supreme Court discussed the double jeopardy analysis to be undertaken
when the same conduct violates two statutory provisions. The first step
is to determine whether Congress intended that each violation be a
separate offense. "There is nothing in the Constitution which
prevents Congress from punishing separately each step leading to the
consummation of a transaction which it has power to prohibit and punishing
also the completed transaction."
Id.
at 2412 (emphasis in original), quoting Blockburger v.
United States
, 284
U.S.
299, 304 (1932). The inquiry is into the language, structure and
legislative history of the statutes involved. Garrett, 105 S.Ct.
at 2412. If the legislative intent is unclear, it can also be inferred
by using the test laid out in Blockburger v. United States--whether
"[e]ach of the offenses created requires proof of a different
element." See Garrett, 105 S.Ct. at 2411, quoting
Blockburger, 284
U.S.
at 304.
As for the §7203
2
misdemeanors, the statutory language suggests two separate offenses:
both §7201 and §7203
state that the penalties imposed are "in addition to other
penalties provided by law." See supra notes 1 & 2. The
legislative history, on the other hand, is inconclusive. See S. Rep. No.
1622, 83d Cong., 1st Sess. (1954), reprinted in [1954] U.S. Code
Cong. & Ad. News 4621, 5251 ("Under these amendments, section
7201 will apply only to a willful attempt in any manner to evade or
defeat the tax or payment thereof, and the lesser offense of a willful
failure to file a tax return will be punishable as a misdemeanor under section
7203 ."); H. Conf. Rep. No. 2543, 83d Cong., 1st Sess. (1954), reprinted
in [1954] U.S. Code Cong. & Ad. News 5280, 5343-44
(substantially similar language).
The structure
of the statute--one broad felony followed by a large number of related
misdemeanors--suggests different offenses. The Supreme Court in Spies
described §7201 as
"the capstone of a system of sanctions which singly or in
combination were calculated to induce prompt and forthright
fulfillment of every duty under the income tax law . . . ." Spies,
317
U.S.
at 497 (emphasis supplied). The court in Reynolds v. United States,
288 F.2d 78 (5th Cir.), cert. denied, 368 U.S. 883 (1961),
agreed, holding that Congress intended a §7201
offense and the misdemeanor of willfully failing to pay tax, 26
U.S.C. §7202 , to be
separate offenses. Further, applying the Blockburger test, we
find that a violation of either statute would not necessarily entail a
violation of the other. See
United States
v. Woodward, 105 S.Ct. 611, 612 (1985). In Woodward, the
defendant made a false statement to a customs agent when declaring what
he was bringing into the country. He was convicted of making a false
statement to a
United States
agency and willfully failing to report that he was carrying more than
$5,000 into the country. Although the same conduct--answering
"no" to the question whether he was bringing more than $5,000
into the country--was the basis for both convictions, the Court noted
that "proof of a currency reporting violation does not necessarily
include proof of a false statement offense."
Id.
(emphasis supplied).
A §7203
misdemeanor requires proof that (1) the defendant had a legal duty
to file a tax return; (2) he failed to do so; and (3) he acted
willfully. United States v. Gorman [68-1
USTC ¶9312 ], 393 F.2d 209, 213 (7th Cir.), cert. denied,
393 U.S. 832 (1968). There is no requirement of an affirmative act,
whereas a §7201 offense
requires some affirmative act. Failure to file without more will not
sustain a conviction under §7201
. United States v. Spies [43-1
USTC ¶9243 ], 317 U.S. 492, 499 (1943). Conversely, while someone
attempting to evade or defeat tax will often fail to file a return, this
is not necessary for the completion of the offense (for instance, one
could file a fraudulent return or file a return without remitting
payment). Finally there is no indication that Congress did not intend
these two statutory provisions to be separate offenses. See Albernaz
v.
United States
, 450
U.S.
333, 340 (1981). All guides to legislative intent suggest that Congress
meant §§7201 and
7203 to constitute separate offenses and that Foster's convictions for
both offenses do not violate the double jeopardy clause.
With regard to
the §7205 3
violation, Congress stated its intent in the statutory language: a
criminal conviction for a violation of §7205
should be "in lieu of any other penalty provided by law." 4
This language was added by §1626(d) of The Current Tax Payment Act of
1943, Pub. L. No. 68, 57 Stat. 126, 138, codified at 26 U.S.C. §470(d)
(I.R.C. 1939), and the legislative history explains that the penalties
imposed by the section "are in lieu of those provided in section
145(a) of the code." S. Rep. No. 221, 78th Cong., 1st Sess. 31
(1943). Section
145(a) of the 1939 Internal Revenue Code was a misdemeanor offense
of failing to file returns, submit information or pay tax and was the
apparent predecessor to §7203
of the 1954 Code. Section
145(b) was, however, a felony offense producing a heavier penalty
for "any person who willfully attempts in any manner to evade or
defeat any tax imposed by this chapter. . . ." Thus, it appears
that Congress intended a conviction for filing a false W-4 form to be in
lieu of other misdemeanors involving filing but not in lieu of the
felony offense of attempting to evade the income tax. This further
buttresses our view that Congress intended the §7201
offense to be an offense separate from the numerous misdemeanors in
the Code. When §470(d) was moved to §7205
in the current tax code, the legislative history noted that no
change was intended from existing law. S. Rep. No. 1622, 83d Cong., 1st
Sess. (1954), reprinted in [1954] U.S. Code Cong. & Ad. News
4621, 5252. As with §7203
, filing a false W-4 form and attempting to evade taxes are separate
offenses under Blockburger as well. Since Congress intended that §7201
and §7205 be
separate offenses, Foster's double jeopardy argument must fail. 5
Second, Foster
argues that his convictions on all counts are not supported by
sufficient evidence because the government did not prove that he had the
requisite state of mind for any of the offenses. The government was
required to prove that Foster acted "willfully" with respect
to each of the seven offenses.
To show that
Foster acted willfully, the government needed to demonstrate that Foster
intentionally violated a known legal duty--it was not required to show
any bad purpose on his part. United States v. Pomponio [76-2
USTC ¶9695 ], 429 U.S. 10, 12 (1976). Foster's reliance upon United
States v. Aitken [85-1
USTC ¶9209 ], 755 F.2d 188 (1st Cir. 1985), and United States v.
Phillips, 775 F.2d 262 (10th Cir. 1985), where a subjective
test--requiring an inquiry into the defendant's actual state of
mind--was employed, is misplaced. Whatever may be the theoretical
objections, the Seventh Circuit has adopted an objective test: because
the mistake of law defense is extremely limited, a mistake on the
defendant's part must be "objectively reasonable." United
States v. Moore [80-2
USTC ¶9627 ], 627 F.2d 830, 833 (7th Cir. 1980), cert. denied,
450 U.S. 916 (1981). Accord United States v. Witvoet [85-2
USTC ¶9530 ], 767 F.2d 338, 340 (7th Cir. 1985); United States
v. Bressler [85-2
USTC ¶9646 ], 772 F.2d 287, 290 (7th Cir. 1985), cert. denied,
106 S. Ct. 852 (1986).
Moreover, the
evidence supports the conclusion that Foster acted willfully under either
test. The district court found that Foster knew that he had to file
income tax returns, that he knew that he had made false statements on
his W-4 Forms, and that he had an "overall purpose" to evade
taxes he knew he owed. We cannot say that these findings were clearly
erroneous. Before 1979 Foster filed taxes regularly and before 1980 he
filed accurate W-4 forms with his employers. He also received several
notifications about his tax liability from the IRS. Also in the record
are tax protester materials Foster sent to the IRS and to Will-DuPage.
The evidence supports the conclusion that Foster acted willfully in
failing to file tax returns, filing a false W-4 form and attempting to
evade taxes.
Foster's third
assertion of error is that his prosecution under the Internal Revenue
Code of 1954, 26 U.S.C. §1 et
seq., was void ab initio because the Sixteenth Amendment to
the federal Constitution was never properly ratified. Foster only gave
this court the briefest of explanations, in his reply brief, as to why
the amendment was improperly ratified. In his opening brief he
incorporated by reference the brief filed by the defendant-appellant in United
States v. Ferguson, No. 85-1688, currently pending before this
court.
This
incorporation method violates F.R.A.P. 28(a)(4), which requires that an
appellant's brief contain "the contentions of the appellant with
respect to the issues presented, and the reasons therefor, with
citations to the authorities, statutes and parts of the record relied
on." Mr. Foster has merely cited to a brief in an unrelated case,
prepared by a different attorney from his own--which itself does not
explain why the Sixteenth Amendment is void beyond stating the
conclusion that the required number of state legislatures never ratified
the amendment and that then-Secretary of State Philander C. Knox
falsified the certification record. See Appellant's
Brief
,
United States
v.
Ferguson
, No. 85-1688, at 10.
In his reply
brief, Foster sets forth the following contentions: (1) that on
February 25, 19
13 Secretary Knox certified the Sixteenth Amendment as duly ratified, 36
states having tendered ratifying resolutions to the State Department;
(2) that Knox knew that 11 states had adopted versions with different
wording, 22 states had altered the amendment's punctuation, and one
state (Kentucky) had actually rejected the proposed amendment; (3) that
the Office of the Solicitor had informed Knox that "a legislature
is not authorized to alter in any way the amendment proposed by
Congress"; (4) that Knox therefore knew he was under a duty to
instruct those 33 states that they must ratify a conforming version of
the amendment. Appellant's Reply Brief at 10-12. Based on these
contentions, Foster asserts that the ratification of Sixteenth Amendment
did not comply with Article V of the Constitution and that therefore the
Sixteenth Amendment is unconstitutional.
At the outset,
we note that the Sixteenth Amendment has been in existence for 73 years
and has been applied by the Supreme Court in countless cases. While this
alone is not sufficient to bar judicial inquiry, it is very persuasive
on the question of validity. In Knoblauch v. Commissioner [85-1
USTC ¶9109 ], 749 F.2d 200 (5th Cir. 1984), cert. denied,
106 S. Ct. 95 (1986), the court was presented with the argument that the
Sixteenth Amendment had not been properly ratified because "Ohio
was not a state when it ratified the amendment, that William Howard
Taft, being from Ohio, was thus not legally president at that time, and
that all laws enacted during Taft's administration are therefore
void."
Id.
at 201. The court found persuasive in rejecting that argument the fact
that " 'recognition of the validity of [the] amendment [has]
continued in an unbroken line.' "
Id.
at 202, citing Parker v. Commissioner [84-1
USTC ¶9209 ], 724 F.2d 469, 471 (5th Cir. 1984). See also, e.g.,
Maryland Petition Committee v. Johnson, 265 F. Supp. 823, 826 (D.
Md. 1967), aff'd, 391 F.2d 933 (4th Cir.), cert. denied,
393 U.S. 835 (1968) (Fourteenth Amendment's "age and usage"
are "persuasive indicia" of valid ratification); United
States v. Association of Citizens Councils, 187 F. Supp. 846, 848
(W.D. La. 1960) (noting in upholding validity of Fourteenth and
Fifteenth Amendments the "hundreds of cases in which the United
States Supreme Court has applied these Amendments"). 6
Thus, we would
require, at this late hour, an exceptionally strong showing of
unconstitutional ratification. Foster has not made such a showing. He
has not asserted any authority, binding on this court or for that matter
on Secretary Knox in 1913, for his contention that a state's ratifying
resolution may not have different punctuation or slightly different
wording than Congress' version of an amendment. 7
He offers no support for his claim that any wording changes were not
inadvertent but rather the product of "deliberate
malfeasance." He has not shown that these slight variations
affected the meaning of what the states acceded to in ratifying the
amendment. "[He] has merely pointed to technical variances which
may be of some historical interest but which have no substantive effect
on the meaning of the Sixteenth Amendment." United States v.
House, 617 F. Supp. 237, 238-39 (W.D. Mich. 1985) (addressing
precisely the same contentions on a complete record). He clearly has not
carried the burden of showing that this 73-year-old amendment was
unconstitutionally ratified.
For all of the
foregoing reasons, the conviction of James Foster on all counts is
AFFIRMED.
1
26 U.S.C. §7201 (1982)
provides:
Any
person who willfully attempts in any manner to evade or defeat any tax
imposed by this title or the payment thereof shall, in addition to other
penalties provided by law, be guilty of a felony and upon conviction
thereof, shall be fined not more than $100,000 ($500,000 in the case of
a corporation), or imprisoned not more than 5 years, or both, together
with the costs of prosecution.
2
26 U.S.C. §7203 (1982)
reads in relevant part:
Any person
required under this title to pay any estimated tax or tax, or required
by this title or by regulations made under authority thereof to make a
return . . . keep any records, or supply any information, who willfully
fails to pay such estimated tax or tax, make such return, keep such
records, or supply such information, at the time or times required by
law or regulations, shall, in addition to other penalties provided by
law be guilty of a misdemeanor and, upon conviction thereof, shall be
fined not more than $25,000 . . . or imprisoned not more than 1 year, or
both, together with the costs of prosecution . . .
3
26 U.S.C. §7205(a) (1982)
reads:
Any
individual required to supply information to his employer under section
3402 who willfully supplies false or fraudulent information
thereunder which would require an increase in the tax to be withheld
under section 3402
, shall in lieu of any other penalty provided by law (except the
penalty provided by section
6682 ), upon conviction thereof, be fined not more than $1,000, or
imprisoned not more than 1 year, or both.
4
See supra note 3. For violations occurring after
July 18, 1984
, Congress has amended this provision to read that a §7205
criminal penalty shall be "in addition to" any other
penalty provided by law. Pub. L. No. 98-369, §159(a)(1), 95 Stat. 341
(1984). The legislative history examined the change: "Thus for
example, prosecution for willful evasion (sec.
7201 ) is not barred where prosecution for a false certificate (sec.
7205 ) is also possible." H. Conf. Rep. No. 861, 98th Cong., 2d
Sess. 1001 (1984), reprinted in [1984] U.S. Code Cong. &
Admin. News 751, 995. The amendment was made in response to United
States v. Williams [81-1
USTC ¶9268 ], 644 F.2d 696, 700 (8th Cir.), cert. denied sub
nom. Terrell v. United States, 454 U.S. 841 (1981), where the court
ruled that Congress intended filing a false W-4 form to be punished
solely under §7205 and
did not intend such conduct to be included under §7212
(endeavoring to obstruct the due administration of the Internal
Revenue Code).
5
We also note that, since all of these convictions were obtained at one
trial, Foster's only argument can be against cumulative punishments, not
cumulative prosecutions. In fact, the sentencing was arranged in such a
way that he received only eighteen months' imprisonment overall. He was
sentenced to eighteen months on Court Three (attempted tax evasion in
1981) and received a suspended sentence on Count Five (attempted tax
evasion in 1982). The other sentences ran concurrently with Count Three
and (with some running concurrently with each other) equaled eighteen
months. Thus, even if there had been a double jeopardy violation we fail
to see how, under the sentencing scheme here, it resulted in cumulative
punishment.
6
Further, we note that there is authority for treating the validity of an
amendment's ratification as a non-justiciable political question. In Leser
v. Garnett, 258 U.S. 130 (1922), it was objected that the
resolutions of two states ratifying the Nineteenth Amendment did not
conform to those states' legislative procedure. The Supreme Court ruled
that
[t]he
proclamation by the Secretary certified that from official documents on
file in the Department of State it appeared that the proposed Amendment
was ratified by the legislatures of thirty-six states, and that it 'has
become valid to all intents and purposes as a part of the Constitution
of the United States.' As the legislatures of Tennessee and of West
Virginia had power to adopt resolutions of ratification, official notice
to the Secretary, duly authenticated, that they had done so was
conclusive upon him, and, being certified to by his proclamation, is
conclusive upon the courts.
Id.
at 137 (emphasis supplied). In Coleman v. Miller, 307
U.S.
433, 450 (1939), the Court refused to address the effect of a previous
ratification or rejection of the Child Labor Amendment upon a subsequent
ratification, finding this "a political question pertaining to the
political departments." These two cases have been followed by
several lower courts, see, e.g., United States v. Ferguson, No.
84-100-CR (N.D. Ind.
Jan. 15, 1985
) (addressing same arguments as this appeal concerning invalidity of
Sixteenth Amendment); Maryland Petition Committee, 265 F. Supp.
at 825-27 (addressing contention that fewer than three-quarters of the
states ratified Fourteenth Amendment).
7
Foster dispenses with the ultimate conclusion of the Solicitor--that the
ratification was proper--by calling it a "house of cards."
Appellant's Reply Brief at 12. One district court has found the
reasoning in the Solicitor's memorandum "as persuasive to this
Court as it apparently was to Secretary Knox."
United States
v. House, 617 F. Supp. 237, 239 (W.D. Mich. 1985).
[87-2 USTC ¶9591]
United States of America
, Plaintiff-Appellee v. James C. Buckner, Defendant-Appellant
(CA-7),
U.S. Court of Appeals, 7th Circuit, 86-3128,
10/1/87
, 830 F2d 102, Affirming an unreported District Court decision
[Code Secs. 7201 ,
7203 and 7205--Result unchanged by the Tax Reform Act of 1986 ]
Criminal penalties: Evasion or avoidance of tax: Conviction: Failure
to file returns: Lesser included offenses: Fraud: Withholding of tax on
wages.--A taxpayer had the requisite specific intent to support his
conviction under Code Secs.
7201 , 7203 and 7205
. Furthermore, the taxpayer's claim that he was denied access to
information about the grand jury panel and his assertion that the
charges of failure to file returns were lesser included offenses of his
tax evasion charge were both rejected. The circuit's rule requiring that
only objectively reasonable mistakes negate the necessary mental state
for tax offenses was not satisfied. The taxpayer's mistaken belief in
various tax protestor-type arguments which had been unanimously rejected
by numerous courts did not consititute a reasonable mistake of law.
Charges of failure to file returns were declared not to be lesser
included offenses of tax evasion in Foster, CA-7, 86-1
USTC ¶9327 , 789 F.2d 457, a case which the taxpayer's lawyer had
handled.
Anton R.
Valukas, United States Attorney, Stephen P. Sinnot, Assistant United
States Attorney, Chicago, Ill. 60604, for plaintiff-appellee. Andrew B.
Spiegel, 77 W.
Washington St.
,
Chicago
,
Ill.
60602
, for defendant-appellant.
Before FLAUM,
EASTERBROOK, and KANNE, Circuit Judges.
EASTERBROOK,
Circuit Judge:
The prosecutor
launched a preemptive strike in this criminal prosecution of a tax
protester. The district court granted the prosecutor's request for an
order forbidding the defense to bring "to the attention of the jury
by argument or evidence any matters relating to" five enumerated
issues:
That the
Sixteenth Amendment to the U.S. Constitution was improperly ratified and
therefore never came into being;
That wages are
not income and therefore are not subject to federal income tax laws;
That tax laws
are unconstitutional;
That filing a
tax return violates the privilege against self incrimination under the
Fifth Amendment to the U.S. Constitution;
That Federal
Reserve Notes do not constitute cash or income.
These
"tired arguments", Coleman v. CIR [86-1
USTC ¶9401 ], 791 F.2d 68, 70 (7th Cir. 1986), are the repertory of
the tax protest movement. They amount to obdurate refusal to acknowledge
the law. In civil litigation they are sanction-bait, see Coleman;
Buckner seeks to persuade us that in criminal litigation they are
grounds of acquittal.
His technical
argument is that offenses such as tax evasion under 26 U.S.C. §7201
, failure to file tax returns under 26 U.S.C. §7203
, and filing false forms W-4 under 26 U.S.C. §7205
--the offenses of which Buckner was convicted--are specific intent
crimes. The prosecution must show that Buckner did these things knowing
he had a duty to act otherwise. United States v. Pomponio [76-2
USTC ¶9695 ], 429 U.S. 10 (1976). Buckner contends that he must be
acquitted if he acted in a mistaken belief that his conduct was in
accord with law.
The approach
is brought up short by this circuit's rule that only objectively
reasonable mistakes negate the necessary mental state for tax offenses. United
States v. Moore [80-2
USTC ¶9627 ], 627 F.2d 830, 833 (7th Cir. 1980). Although this view
has been challenged by other circuits, e.g., United States v. Aitken
[85-1 USTC
¶9209 ], 755 F.2d 188, 191-93 (1st Cir. 1985), we have reaffirmed
it. United States v. Davenport [87-2
USTC ¶9422 ], 824 F.2d 1511, 1517-18 (7th Cir. 1987); see also,
e.g., United States v. Bressler [85-2
USTC ¶9646 ], 772 F.2d 287, 290-91 & n.2 (7th Cir. 1985). If
the legal system accepts every mistake of law as a defense, this leads
people to be ignorant, to delude themselves, or to tell tall tales to
the jury. If the legal system either refuses to recognize a mistake of
law as a defense (the usual rule) or accepts only a reasonable mistake
as a defense (our rule in tax cases), this leads people to learn and
comply with the law. Limiting the defense in tax cases is essential
because the desire to keep as much of one's income as possible would
supply an irresistible temptation to be obtuse about the law, if
obtuseness eliminated the duty to pay.
Our cases from
Moore
to
Davenport
have dealt with jury instructions. Their principle governs the receipt
of evidence as well. If a particular belief is objectively unreasonable
as a matter of law and therefore irrelevant, the court need not accept
evidence tending to show that the defendant possessed that belief. Fed.
R. Evid. 402. And there can be no doubt that the five propositions the
district court put under the ban are unreasonable as a matter of law. We
have rejected each, many times. Believing an incorrect proposition of
law is a "reasonable" mistake only if there is a bona fide
dispute about it. For example, a person with a rare blood type who
regularly sells the blood may be reasonable (if wrong) in believing that
the exchange is not taxable, when there is no precedent directly on
point. See United States v. Garber [79-2
USTC ¶9709 ], 607 F.2d 92 (5th Cir. 1979) (en banc). Clinging to a
proposition that has been unanimously rejected by numerous courts is not
a "reasonable" mistake.
The court told
the jury that it could convict Buckner only if the prosecution proved
beyond a reasonable doubt that Buckner knew he had to pay taxes and file
returns. It informed the jury that a "good-faith misunderstanding
of the law based on reasonable grounds may negate wilfulness." The
court's order did not prevent Buckner from showing any mistake based on
"reasonable grounds". He complied with the tax laws until
1981. Then he stopped filing returns and started making specious claims
of exemption on his W-4 forms. The evidence was sufficient to support
the jury's verdict.
Buckner's
principal remaining argument is that the court unduly restricted his
access to information about the composition of the grand jury panel. The
court made available data about the panel in April 1984, from which the
grand jurors who indicted Buckner were drawn. The court also set a date
for making motions based on these data. The date passed, but Buckner
belatedly filed an unsworn motion calling the data insufficient for
analysis and requesting more. The court properly denied this request.
Buckner had a statutory right to data sufficient to assess the
composition of the panel, 28 U.S.C. §1867(f); Test v. United States,
420 U.S. 28 (1975), but the statute offers assistance only to the
litigant who analyzes the data he receives and provides a "sworn
statement of facts which, if true, would constitute a substantial
failure to comply with the provisions of this title", §1867(d). An
untimely assertion that counsel wants more data does not automatically
entitle the litigant to another round of records. The Jury Selection and
Service Act is not a license for delay at the defendant's option. United
States v. Koliboski [85-1
USTC ¶9251 ], 732 F.2d 1328, 1331 (7th Cir. 1984). Having failed to
make anything of the data he requested underlying the selection of the
grand jury that indicted him, Buckner was not entitled to rummage
through the records for other months.
Buckner also
insists that the charges of failure to file returns are lesser included
offenses of the charges of tax evasion. We held the contrary in United
States v. Foster [86-1
USTC ¶9327 ], 789 F.2d 457, 460 (7th Cir. 1986), which Buckner's
lawyer, Andrew B. Spiegel of Chicago, does not cite even though he was
also Foster's lawyer. We remind Spiegel of his ethical obligation to
bring to the court's attention relevant authority binding on the court.
Tax protesters ignore cases rejecting their positions; we expect
different behavior from members of our bar. None of Buckner's other
contentions requires discussion.
AFFIRMED