Jose Escobar v. United States

light litigation in are reasonable prosecu- this by their successful be said The Government rendered. the services plaintiffs into came tion of this suit already stipulated the reason- as to property has possession” of the “constructive Since fact, court costs. ableness of the Tex. In under in the involved suit. charg- litigation the fees were for which plaintiffs’ title vested Prob.Code 37§ might quite re- complicated and ed parties in construc- at that time.16 As quire be- the finding of additional facts possession property of the dece- tive can fore a decision as reasonableness dent, they to may considerd “execu- be even question made, be we remand this to 2203. tors” under Int.Rev.Code however, below. label, court The use this should necessary plaintiffs es- not be for further remand We reverse and deductible; attorneys’ nor tablish as opinion. fees proceedings consistent solely they penalized should be capacity, there official existed no formal law, they in which had state 2053(a)

act. does not turn

such distinctions. Altendorf

States, D.N.Dak.1964, F.Supp. 969. ESCOBAR, permitted Appellant, Jose plaintiffs The be should County expenses Rusk deduct the action well. The action that case America, UNITED STATES title, one clear and was based Appellee. underlying the will rather contract No. 23529. The than on the itself. effect on will however, estate, if Appeals same as United States Court of brought plaintiffs Fifth Circuit. the 1948 will had right probate. plaintiffs’ Dec. 1967. property by estate was estab- held Rehearing En Banc Denied Feb. 1968. once all lished and for court April 22, competent jurisdiction. Certiorari Denied When such a property transfer of a decedent’s is ac- See 88 S.Ct. 1411. complished law, Texas and subject estate, transfer to a federal infer seems reasonable the ex- penses bringing incurred about that

transfer must considered determin- pur- the net for federal tax estate Haggart’s poses. Estate v. Commission

er of Revenue, Internal

F.2d 514.

IY. only question left to decide attorneys’ whether fees incurred plaintiffs prosecution in the leaving dies, person 362. And see Tex. a lawful “When a provides will, or be- Prob.Code all of his estate devised “personal queathed representatives immedi- estates shall such will shall vest necessary ately legatees; also entitled to all rea- and and all the devisees expenses person, sonable incurred them in the devised the estate such immediately preservation, manage- bequeathed safe-keeping, in his shall vest * * * * * ment of the estate all rea- heirs at law Tex.Prob.Code § 37. attorney’s fees, necessarily sonable in- proceedings curred in connection with the * * management of such estate urges return.”3 filing allege of a return failure allege a element essential failure the indictment of the and that against crime therefore does unnecessary United for States. It analogize attempt cases decided us to Houston, Smith, Tex., J. Edwin Town- upon appellant would other statutes as Paso, Tex., appel- Leeper, er S. El for argument do, us have lant. decision in foreclosed our recent Harry Hudspeth, Tex., Paso, El Lee States, 5 358 Hoover v. United Cir. appellee. There, here, the F.2d 87. as indictment DYER, BELL, Before and GODBOLD alleged substantially in the “the offense Judges. Circuit language 7206(1), of which con- Section of the tains all of essential elements Judge: DYER, Circuit and sufficient within offense is thus meaning 7(c), of Federal Rules of Appellant Rule in a four count An indictment Criminal willfully making Procedure. indictment1 subscribing and with substantially alleging an in the income tax false returns language is sufficient of the years statute 1957,1958, 1959 and I960.2 He do unless the words of the statute acquitted 1 on Count and found of guilty contain all of the essential elements on the other counts. In his three appeal the offense. 1962, United Russell v. 749, from the conviction Counts 8 L.Ed. (1) 3 and he reversal because of seeks 240; Reynolds 2d United the failure of the indictment state cert, (5 denied, offense; 1955), (2) F.2d 123 of the non-disclosure identity informer; (3) of an the refusal 100 L.Ed. requested instructions; (4) Worthy (1955).” the insuf- Id. accord at ficiency evidence; (5) States., of the and F.2d 5 Cir. estoppel guilty appellee of the the not 392. verdict as to Count 1. affirm. We Identity The Informer’s

Sufficiency Indictment During cross-examination count in Each the indictment Agent Special Revenue for the Internal alleges defendant did “make * * * investiga- Service, developed and it subscribe income tax [an] April 15, $6,192.00; 1. “That on or about in violation of within excess Code, El Paso Division of Western Title United States Texas, 7206(1).” Escobar District of Jose did wil fully knowingly allegations and 3 and were and make subscribe a in Counts except Income Individual Tax Re and States identical as to dates amounts. turn, Treasury Department Form perti- 7206(1) provides 2. a written was verified declara 26 U.S.C.A. penalties part: under the tion that it was made nent “Any person * * * wilfully perjury, which said United who States * * * any Return he makes and return Individual Income Tax subscribes did every or a writ- believe to be true and correct as which contains is verified ten is made material matter the said declaration penalties perjury, he does States Individual Income Tax and which Return representa not believe to be true and correct as contained the statement * * * every shall be material matter tion Mavis E. that Jose and Escobar of upon guilty felony and, Paso, Texas, conviction El of a had received taxable thereof, year during shall be fined not than income the calendar more $5,000.00, imprisoned $6,192.00, than not more amount whereas he years, together believed, both, then three with there well knew and prosecution.” Paso, Jose and E. of El costs Mavis Escobar Texas, received taxable dur income had 1, supra. year substantially note See the calendar genesis making tion of had its ed from knowledge his defense without appellee identity.” an informer. advised the informer’s only pro- court that Firo the informer had other F.2d vided information about someone brought appellant. than It out Requested Perjury Instructions on appellant’s law that other members of investigated simultaneously firm were requested and the file were all convicted of failure court refused to instruct The court sus- income tax returns. the so-called “two witness rule” and the appellee’s tained the refusal to disclose stringent proof applicable burden of identity informer, required perjury. Appellant cases of contends appellee to the name submit to the court that given the instructions should been have camera, of the informer in and announced language the of the statute inform- that if either side call the should punishes making the willful and sub testify er to would the the court excuse scribing of a false return “which contains jury notify The inform- both sides. by or is verified a written declaration er was not called. penalties that it is made under the of Appellant preju- 5 that claims he was perjury.” He that asserts the indict the in- diced the of non-disclosure against charged ment perjury him unspeci- former because he could not call give that the refusal to the instructions fied defense witnesses the risk without was reversible error. Weiler United v. placing that he would be the informer States, 1945, 548, 606, 323 65 ignores the the court’s stand. But this 89 L.Ed. 495. representation to counsel that it would “plain meaning Under the rule” of notify both if the informer was sides statutory construction it clear testify. Moreover, is that to called the appellant compelling perjury. of absence reason some was doing so, disclosure of an informer’s say The statute does that one who identity generally Rugen- is declined. willfully a makes false return “shall be 528, States, 1964, dorf United guilty 376 U.S. perjury.” fact, of In it contains 534-536, 825, 84 S.Ct. 11 L.Ed.2d language indicating no the crime States, 1964, Robinson v. United 5 Cir. perjury language is involved at all. The 880, 325 F.2d 883.4 fails to penalties perjury” under “made is any showing “prevent- make purely he was significance.6 historical States, 4. In 1965, requirement Wheeler v. effect, pred- United 1 Cir. was still in 946, by appellant, F.2d 351 present relied on statute, ecessor of the former § improper there was an 145(c) Code, limitation of de- the Internal Revenue right fendant’s of cross examination of a 145(c) was enacted. add- actually witness called. Roviaro v. Unit- ed to the 1939 Code the act of Oc- States, 1957, 53, ed 353 (1942). tober Stat. 1 L.Ed.2d 639 Taylor States, and Portomene v. United 9 Cir. States, specifically applied F.2d cited F.2d It to by appellant inapposite. are penalties provided In each case its violation the § participant the informer was a predecessor code, the sale the criminal Appellant’s suggestion po- of heroin. perjury statute, § 18 U.S.C.A. entrapment persuasive tential is not requirement be- 1621. The oath re- entrapment presupposes guilt, yet cause pealed by August the act of appellant maintained in- (1949) he was Stat. 667 codified as 26 U.S.C.A. charge. McCarty nocent of (1952), § 3809 which statute also re- 5 Cir. pealed 145(c) § of the Internal Revenue 3809(a), Code. The new § which was 2, supra. 5. See note apparently intended to substitute for § time, 6. At one income tax 145(c), very had to present returns similar to the be made under oath. 7206(1). longer was true when This § U.S.C.A. It no Levin v. penalties referred to the in 18 U.S.C.A. F.2d 598 was decided. penalty provided While oath § for its fine, plus $10,000 imprisonment and phrase present in the statute remains may prosecution) costs of “signpost” phrase” to indi- a “catch evidence, proven circumstantial types are covered cate what of documents 348 U.S. any Holland v. phrase this statute. Without It would 99 L.Ed. 150. purview would come document within appel- contradictory accept to indeed identical and it would be statute argument an there must be lant’s application (except penalty) to 26 U.S.C.A. § the lesser rules stricter which is statute. a misdemeanor 7206(1). offenses light it under- When viewed in Congress phrase left standable that urges held Finally, that we in the and that Internal statute States, supra, that in Hoover v. United in its Revenue Service left statement prosecution 26 U.S.C.A. § requiring return forms after statute prosecu- analogous perjury (1) to a repealed.7 returns to be sworn was context, said what we tion.8 But read in was, though phrase, outdated only the defend- there had reference easily provide remained to discernible failed court had contention that the ant’s 7206(1) application limit matter.” term “material Congress predecessors. its It relieved reasoning per- pointed in the We having from new some substitute subject matter was as to what cases phrase. purpose That other it serves no Comparing element material. the by perjury is evidenced the fact that prosecution under in matter” a “material States, requires oath, United v. Smith perjury 7206(1) in a that element with § 143, 144, no 363 F.2d prosecution of- make the two does not required oath return. in an income tax is analogous. convinced that We are fenses Furthermore, “penalties spite in of the refusing properly in the acted court Congress perjury” language, for went perjury appellant’s requested instruc- lighter provide on to much another and tions. by penalty proscribed for the offense 7206(1), (3 years) provided than that § Included Refusal of Lesser perjury for 1621 under 18 U.S.C.A. § Charge Offense (5 years). erred Appellant court that the contends Appellant cases, and we have cites no jury refusing charge could that the in applying any, the been to find unable guilty under U.S.C.A. § find him 26 prose- proof perjury in rules cases to though (misdemeanor) he was even 72079 7206(1). It cutions 26 U.S.C.A. § violating 7206 U.S.C.A. § 26 indicted significant is that in the most serious (1) (felony). is an element There offenses, of all tax 26 7201 U.S.C.A. § e., 7207, i. 7206(1) not in which is § § (which attempts proscribes willful contain a statement document must the evade and which carries defeat taxes and penalties of it is “made under the penalty maximum found the heaviest years perjury.” the Internal Revenue Code—five prosecution perjury which latter a as in the nature to violation was the same years $2,000 (5 gravamen fine.) false As offense section. makes the * * swearing part matter to a material of the Internal Bevenue Code of a 1954, enacted, present 7206(1) was perti- provides in 7207 9. 26 U.S.C.A. changed penalty time the this willfully “Any person part: who nent years’ imprisonment maximum a of 3 * * * Secretary delivers $5,000 fine, plus prose- the costs of * * * * * * * * * any return cution. to be or him to bo fraudulent known matter, any course, phrase shall material a false as to Of served definite impris- $1,000, requirement purpose more than fined not before the oath year, both.” not more than oned removed. following Appellant quotes from 7206(1) is similar Hoover: applies to Section 7207 income of Willfulness Evidence tax v. United violations. Sansone on the fact that will Premised S.Ct. fulness is element of an essential 1009, 13 L.Ed.2d 882. Since the other argues charged,10 offense (§ 7206(1)) applies statute also involved appellee a shown no more than has violations, to income tax mere of income and understatement Sansone, rationale of “the lesser-included showing inadequate to establish is applies offense doctrine these statutes however, satisfied, are willfulness. We appropriate in an case.” Ibid. more than evi there is sufficient question then becomes whether sustain this element dence appropriate this is “an case.” Sansone v. offense. Holland United guidelines: offers the 348 U.S. 99 L.Ed. 150. S.Ct. But a lesser-offense is not attorney practicing is a proper where, pre- on the evidence experience For tax field. sented, factual issues to be resolved years four understated consecutive- he jury are same as to both his Evidence income almost one-half. greater lesser and offenses. underreport pattern of “a consistent 349, 350, Id. at at 1009. S.Ct. may large sup of income” amounts words, In other the lesser must offense port an of willfulness. Holland inference not, be included facts within but States, supra, at case, completely encompassed of the 137; at Smith v. greater. A lesser-included of- 147, 157, L.Ed. 348 U.S. only proper fense where instruction 192; Procario, 2 Cir. States requires greater cert, denied disputed factual find 1923, 16 L.Ed.2d required element con- Alker, States viction lesser-included offense. cert, 906, 135, 148, F.2d denied U.S. 350, (Emphasis Id. at at 1009. S.Ct. rehearing 571, 3 L.Ed.2d added.) denied 359 3 L.Ed. S.Ct. U.S. Cir., Accepting guidelines, 683; Epstein these the 2d v. cert, question to whether there “a narrows is 246 F.2d denied 355 disputed 7206(1) element” factual in L.Ed.2d 74. § present which is Furthermore, appellant not in As was in of

pointed only phases keep out difference all the between law firm’s record the ing knowledge the two in statutes is the “made and had the actual penalties perjury” requirement the partner the state of finances. No firm’s 7206(1). any question ship there required If was returns U.S.C.A. § jury concerning the during years for whether some 6031 were filed the or question. all of returns the involved here A to were file is admissible failure penalties Hoyer were not “made under the on the issue of willfulness. perjury” appellant would have been 8 Cir. entitled, Sansone, requested to the and books records were Pertinent charge. However, appellee investigators contends, and not made available to appellant dispute, although appellant requested re does that all had been “perjury produce turns here contain involved the A to all and books records. savings Therefore, kept appellant declaration.” there no account secret dispute concerning grown $18,000 factual the had in 1956 to from $50 greater during reported to be submitted to the he in 1960 time jury, ergo appellant gross only $38,237.00. was not entitled his to be income charge. requested to appellant his v. At told See Sansone the interview initial 354-355, agents merely United States at he office S.Ct. 1004. that shared 2, supra.

10. See note lawyers, analysis space only by can when it be eliminated an with two other deposits, partnership. actually equal In We not withdrawals. dis- agree. appellee required no The is face of all this evidence there analyze analysis appellant’s deposits, to merit contention that deposits support prerequisite is insufficient method evidence is only element extent of willfulness. information nature deposits source of included funds is Appellant’s of mistake assertion govern- is in the hands of the Claiming his unpersuasive. that also requirement ment available within adding secretary ma- on an calculated pursuing exceptions leads. fewWith his withdrawals chine the amount of deposit slips disclosed no such infor- argues firm, if she from the he (For mation. there the same reason appellant relied made an error agents no merit to the contention that tape con- prepare returns his improperly attempt failed to to locate tapes were viction cannot stand. missing deposit slips.) appellee And evidence, nor is there not offered in govern- sufficiently pursued leads. The they any showing incorrect. were case, prima ment made out a facie nothing Moreover, to indicate there was discharged obligations to make its use tapes in appellant on such that preparing relied pursue of data in its hands and to leads. simply There is his return. Appellant, attacking govern- while appellant’s support for no alleged record accounting produced ment’s method noth- of mistake. defense computa- government’s refute appel- analysis tions. A detailed Sufficiency the Evidence proof precedental lee’s would be of no appellee used the bank value. A careful review of record deposit expenditures method ap- convinces us as to evidence —cash prove appellant his pellant’s understated of income in understatement deposits income, e., year i. bank account total each which he was convicted plus currency paid minus out in entirely items sufficient. equals net income items non-income the Acquittal by Estoppel partnership. Bostwick v. F.2d Because the returned a not States, 5 Holbrook United guilty verdict to count of the first cert, denied 349 F.2d indictment insists that bank 99 L.Ed. 1249. The acquittal by estop must be treated as an computation was the account used in pel Counts and because there is partnership’s in which were trust account no additional evidence of willfulness deposited receipts from the firm’s law support the latter three counts. The practice. appellee correctly The treated short answer if the to this is that even equal partnership as the firm as an upon verdict is looked as inconsistent signed one-third the earn require not would Dunn a reversal. ings deposit firm. The tickets 390, 393, States, 1932, 284 U.S. account did not firm’s trust disclose 52 States, Rua v. United L.Ed. deposited of the funds source deposit could some of tickets cert, denied, 377 U.S. agents found. non-in The eliminated is not L.Ed.2d 738. But verdict analyzing come withdrawals items inconsistent the evidence dif deducting from from the the account and jury might fered on each count. representing deposits total set all sums well have had doubt of the a reasonable funds, tlements, court costs client’s guilt count, appellant’s on the first urges other non-income items. remaining counts. deposit-cash expenditure the bank produce acceptable find without We have considered and method cannot complained of items merit the other errors result non-income here because appellant. judgment of the district

court is

Affirmed.

ON PETITION FOR REHEARING

EN BANC

PER CURIAM: Rehearing

The Petition panel denied and no nor member

Judge regular active service on the having requested

Court the Court banc, polled rehearing en Rule (a), (b), subpar. the Petition for Re

hearing En Banc is denied.

NATIONAL LABOR RELATIONS BOARD, Petitioner,

HECK’S, INC., Haddad, and Fred its President, Respondent.

No. 11390. Appeals

United States Court of

Fourth Circuit.

Argued Nov.

Decided Dec. Dworski, Atty., Bernard N.L.R.B. M.

(Marcel Mallet-Prevost, Asst. Coun- Gen. sel, petitioner. N.L.R.B., petition), Charleston, Holroyd, W. Frederick F. Va., respondent. BUTZNER,

Before BOREMAN Judges, W. Circuit WOODROW JONES, Judge. District

Case Details

Case Name: Jose Escobar v. United States

Court Name: Court of Appeals for the Fifth Circuit

Date Published: Apr 22, 1968

Citation: 388 F.2d 661

Docket Number: 23529

Court Abbreviation: 5th Cir.