Conway v. United States, 5466.

• Decision Date: 31 May 1960
• Docket Number: No. 5466.,5466.
• Citation: 278 F.2d 710
• Parties: Thomas C. CONWAY et al., Appellants, v. UNITED STATES of America, Defendant, Appellee.
• Court: U.S. Court of Appeals — First Circuit

278 F.2d 710 (1960)

Thomas C. CONWAY et al., Appellants, v. UNITED STATES of America, Defendant, Appellee.

No. 5466.

United States Court of Appeals First Circuit.

May 31, 1960.

John M. Maguire, Boston, Mass., with whom C. Keefe, Hurley, John Kimball, Jr., and Hale & Dorr, Boston, Mass., were on brief, for appellants.

David O. Walter, Atty., Dept. of Justice, with whom Abbott M. Sellers, Acting Asst. Atty. Gen., Lee A. Jackson, and Harry Marselli, Attys., Dept. of Justice, Anthony Julian, U. S. Atty., and Andrew A. Caffrey, Asst. U. S. Atty., Boston, Mass., were on brief, for appellee.

Before WOODBURY, Chief Judge, and HARTIGAN and ALDRICH, Circuit Judges.

ALDRICH, Circuit Judge.

This is an appeal from a decision of the district court, sitting without jury, finding appellants, husband and wife, liable for deficiencies in income tax payments for the years 1939 to 1948, inclusive, together with fraud penalties and interest. The husband will hereinafter be referred to as the taxpayer. Essentially the only question raised is whether the evidence warranted the findings as to the dollar amounts of the several deficiencies. That the amounts were in any event substantial, is not disputed, and the finding of fraud is not attacked. Or, as taxpayer states in his brief with more delicacy, "The real and consistent fact is that Dr. Conway's returns for 1934-1948 at no time mirrored the full truth." The criticism is that the court found deficiencies in accordance with the testimony of the revenue agents. This testimony, based upon "the bewildering net worth approach," as taxpayer describes it, he characterizes as "sedentary prefabrication," "financial distortions," "imaginative mathematics," "airy-fairy deductions," and "mere whimsicality," as distinguished from "commonsensible interpretation of matter in the record." We find such attributions more arresting than accurate.

Taxpayer, at the outset, charges that "the trial judge's handling of the present case casts an improper burden upon the patience of the Appellate Court." We have been more impeded by statements throughout taxpayer's brief of seemingly positive fact which prove, on examination, to be nothing but taxpayer's unsupported testimony. Taxpayer says that he has cited only testimony that the trial court has not found to be false. Even were that so, in view of the fact that the court has found vital parts of his testimony to be deliberate concoctions, and has found all of his returns fraudulently false, the suggestion that its general findings must be set aside as clearly erroneous because of taxpayer's testimony not specifically found to be false does not commend itself.¹

Taxpayer raises various contentions more or less standard to net worth cases. First, he asserts that the government evidence of his net worth at the opening of the period, adopted by the court, must be rejected because of his own testimony that he then had a hoard of small bills in the dining room sideboard totaling $55,000. It is sufficient to say that the court...