Singleton v. Comm'r of Internal Revenue
| Decision Date | 18 March 1976 |
| Docket Number | Docket No. 9680-74. |
| Citation | 65 T.C. 1123 |
| Court | U.S. Tax Court |
| Parties | JOHN W. SINGLETON, A.K.A. JOHN WESTLY, A.K.A. JOHN SINKLER, PETITIONER v. COMMISSIONER OF INTERNAL REVENUE, RESPONDENT |
OPINION TEXT STARTS HERE
After this case was set for trial and an evidentiary hearing scheduled on whether petitioner's constitutional rights guaranteed by the fourth and fifth amendments to the U.S. Constitution were violated, petitioner was indicted for income tax evasion for 1 of the 4 years pending before us. Respondent moved for a protective order under Rule 103(a)(1), (2), and (4), Tax Court Rules of Practice and Procedure, to suspend all further proceedings pending the final disposition of the criminal indictment. Held, under the particular circumstances present here, respondent's motion is denied and further proceedings in this civil case will not be suspended.
Petitioner was physically searched at Kennedy Airport as he departed on an airplane leaving the United States at which time $20,000 in cash was discovered on his person. Petitioner was required to execute Form 4790, ‘Report of International Transportation of Currency or Monetary Instruments.’ The search prompted an investigation of petitioner's income tax returns which ultimately led to the instant case. The identity of petitioner's bank on the Form 4790 was not used by agents of the Commissioner in their investigation of petitioner for income tax evasion. Held: The airport search of petitioner violated his rights guaranteed under the fourth amendment to the U.S. Constitution but the Commissioner's determination was not based upon constitutionally tainted evidence because the connection between the illegally obtained evidence and the respondent's proof became so attenuated so as to dissipate the taint. The presumption of correctness of the statutory notice of deficiency is not destroyed and the burden of going forward with the proof is not shifted to respondent under the authority of Efrain T. Suarez, 58 T.C. 792 (1972).
The initial interview of petitioner as to the investigation of his income tax returns was conducted by special agents of the Commissioner early in the morning at petitioner's residence without advance warning simultaneous with an initial interview of petitioner's accountant who prepared petitioner's income tax returns. Held, the manner of conducting the interview of petitioner did not violate his rights guaranteed under the fifth and sixth amendments to the U.S. Constitution. Laurence Goldfein, Ira L. Tilzer, and Richard A. Levine, for the petitioner.
Michael K. Phalin, for the respondent.
The Commissioner determined the following deficiencies in income tax and addition to tax against petitioner:
+----------------------------------------+
¦Taxable ¦Deficiency ¦Addition to tax ¦
+---------+------------+-----------------¦
¦year ¦in tax ¦sec. 6653(b)1 ¦
+---------+------------+-----------------¦
¦ ¦ ¦ ¦
+---------+------------+-----------------¦
¦1969 ¦$20,554.10 ¦$10,277.05 ¦
+---------+------------+-----------------¦
¦1970 ¦11,506.63 ¦5,753.32 ¦
+---------+------------+-----------------¦
¦1971 ¦6,624.07 ¦3,312.04 ¦
+---------+------------+-----------------¦
¦1972 ¦56,999.56 ¦28,499.78 ¦
+----------------------------------------+
Petitioner included in his petition allegations that his constitutional rights were violated. Shortly after respondent filed his answer, petitioner filed numerous motions2 to bring about a ruling on the constitutional grounds prior to trial. After numerous hearings on the motions, we set a hearing in New York City to receive evidence as to the alleged violation of petitioner's constitutional rights. Prior to that hearing, we held a hearing in Washington, D.C., on petitioner's motion for reconsideration of our ruling on petitioner's motion for production of documents at which time respondent filed a motion for protective order on the grounds that petitioner had, the previous week, been indicted for income tax evasion. We denied respondent's motion for protective order; we granted petitioner's motion for production of documents relating to the hearing to be held in New York City; we ordered respondent to turn over to the Court its files for an in camera inspection; we examined the files in camera and served the parties with the portions of respondent's files which we deemed appropriate for petitioner's use for the evidentiary hearing set for New York City.
The evidentiary hearing was held in New York City after which we served the parties with findings of fact and directed them to file memoranda of law.
The proceedings up to this point present the following issues: (1) Should the discovery proceedings in the Tax Court be suspended pending final disposition of the indictment for income tax evasion brought against petitioner; (2) were petitioner's rights guaranteed under the fourth amendment to the United States Constitution violated when he was ‘frisked’ as a departing airline passenger for a foreign destination; (3) were petitioner's rights guaranteed under the fifth and sixth amendments to the United States Constitution violated when agents of the Commissioner conducted the initial interview of petitioner at his residence; and (4) if petitioner's constitutional rights were violated at the airport or at his residence, to what extent should the evidence to be introduced by the Commissioner at trial be suppressed as being tainted.
Some of the facts have been stipulated and are found accordingly. The stipulation of facts and the attached exhibit are incorporated by this reference.
John W. Singleton (hereinafter petitioner) resided at 488 North Woodland Street; Englewood, N.J., at the time he filed his petition in this proceeding. Petitioner timely filed Federal income tax returns for the periods here involved with the following Internal Revenue Service Centers:
+----------------------------------+
¦TYE Dec. 31— ¦Service Center ¦
+----------------+-----------------¦
¦ ¦ ¦
+----------------+-----------------¦
¦1969 ¦Andover, Mass. ¦
+----------------+-----------------¦
¦1970 ¦Andover, Mass. ¦
+----------------+-----------------¦
¦1971 ¦Philadelphia, Pa.¦
+----------------+-----------------¦
¦1972 ¦Holtsville, N.Y. ¦
+----------------------------------+
On the morning of December 7, 1972, petitioner arrived at the BOAC terminal of John F. Kennedy International Airport for the purpose of boarding a flight to Jamaica. Petitioner first checked his baggage at the Air Jamaica counter; when his flight was called, he proceeded to the designated departure gate by means of the north ramp of the terminal.
The following diagram depicts the north ramp of the BOAC terminal as it appeared on December 7, 1972: (DIAGRAM OMITTED)
At the base of the north ramp was stationed a BOAC employee who checked each passenger's boarding pass, denying access to the ramp to any person not possessing such a pass. On the podium next to the official was a sign, 9-by-11 inches in size located 3 feet above the floor facing approaching passengers, indicating that all baggage would be searched prior to boarding and that all passengers would be required to demonstrate that they were carrying no lethal weapons. Passengers proceeding up the ramp toward the flight gates were required to walk to either side of a partition beyond which were located tables on which carry-on baggage was placed for inspection. On the wall at one end of the tables were two 11-by-14-inch signs provided to all carriers by the FAA. The signs, one in English and one in Spanish, stated that carrying concealed weapons aboard an aircraft is punishable by prison sentences and fines and that all passengers and baggage were subject to search. They were printed in red and blue letters 1 1/2 inches in height. The searches of the carry-on luggage were conducted by employees of the U.S. Customs Service. After customs officials were satisfied that carry-on baggage contained no weapons, it was placed on tables directly behind them where it could be claimed by its owner. After picking up their luggage at these tables, the passengers were searched for weapons. The personal searches were conducted behind either of two portable screens located approximately 10 feet beyond the tables. All passengers were frisked by customs officials.
When petitioner's boarding pass was checked at the base of the ramp, he did not notice the sign on the podium; nor did he notice the signs on the wall at one end of the inspection tables where his carry-on baggage, a small airline bag, was searched. After his airline bag was inspected, he was required to walk behind one of the portable screens where he was frisked. The frisking officer, a U.S. Customs Service employee, passed his hands over petitioner's body from his feet upward. Upon feeling something in the breast pockets of petitioner's suit coat, he opened the coat which was previously unbuttoned by petitioner and removed petitioner's passport and a transparent plastic envelope containing currency from each pocket. Each envelope was approximately 2 1/2 inches wide, 6 inches long, and 1/4- to 1/2-inch thick and contained 100 new $100 bills fastened with bank wrappers. The packets had been inserted in petitioner's coat pocket vertically and the tops of the packets of money did not extend above the upper edge of each coat pocket. After the two parcels of cash were removed, petitioner was told to #Wait here.' The officer soon returned with a second customs official at which time petitioner was required to sign Form 4790, entitled ‘Report of International Transportation of Currency or Monetary Instruments.’ That form indicated that the source of funds being transferred out of the United States was ‘Chemical Bank— N.Y.’ The packets of cash were returned and pet...
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