Beaty v. United States, No. 6760.

• Court: United States Courts of Appeals. United States Court of Appeals (4th Circuit)
• Writing for the Court: PARKER, , and SOPER and DOBIE, Circuit
• Citation: 220 F.2d 681,47 AFTR 362
• Parties: Keith M. BEATY, Appellant, v. UNITED STATES of America, Appellee.
• Decision Date: 24 March 1955
• Docket Number: No. 6760.

47 AFTR 362, 220 F.2d 681 (1955)

Keith M. BEATY, Appellant,
v.
UNITED STATES of America, Appellee.

No. 6760.

United States Court of Appeals, Fourth Circuit.

Argued March 7, 1955.

Decided March 24, 1955.

Writ of Certiorari Denied May 31, 1955.

Paul R. Ervin, Charlotte, N. C., and Llewellyn A. Luce, Washington, D. C. (Frank W. Snepp, Jr., and W. M. Nicholson, Charlotte, N. C., on brief), for appellant.

James M. Baley, Jr., U. S. Atty., Asheville, N. C., for appellee.

Before PARKER, Chief Judge, and SOPER and DOBIE, Circuit Judges.

Writ of Certiorari Denied May 31, 1955. See 75 S.Ct. 874.

SOPER, Circuit Judge.

On January 10, 1955 the Supreme Court of the United States considered petitions for writs of certiorari in this and eight other cases in which the Courts of Appeals had affirmed convictions of attempting to evade and defeat the income tax laws in violation of § 145 of the Internal Revenue Code, 26 U.S.C.A. § 145; and the Court vacated the judgments and remanded the cases to the Courts of Appeals for reconsideration in the light of its decisions in four other cases handed down on December 6, 1954, in each of which the prosecution had been based on the net worth method of proof.¹ The Supreme Court did not consider the merits of the cases remanded nor their relation to its recent opinions, but remanded them in the belief that reexamination by the Courts of Appeals was desirable even in those cases remotely involving the principles it had laid down. See 348 U.S. 905, 75 S.Ct. 311. The prior decision of this court in the pending case is found in 4 Cir., 213 F.2d 712.

Accordingly the pending case was set for argument on March 7, with directions to the parties to file briefs restricted to the questions raised in the decisions of the Supreme Court; and in accordance with this order briefs have been filed and counsel have been heard. The principal contention now made on behalf of the defendant is that the Government made use of the net worth method of proof in the District Court but failed to establish "an opening net worth" or the total net value of the taxpayer's assets at the beginning of a given year, as required by the pronouncements of the Supreme Court. One ground for this contention was the introduction in evidence by witnesses for the United States of two statements dated December 31, 1944 and June 30, 1946 respectively,

220 F.2d 682

which defendant had given to a brewery company as evidence of his financial status in connection with a purchase of merchandise. These statements showed an increase of net worth during the period of eighteen months in the amount of $145,800.10, and they were used as evidence tending to show that the net taxable income of the defendant was greater than that disclosed by his income tax reports for the years under examination

The defendant contends that these statements were without probative force...