Diehl v. United States

• Decision Date: 18 February 1971
• Docket Number: No. 29022.,29022.
• Citation: 438 F.2d 705
• Parties: Kent B. DIEHL, Sr., et al., Plaintiffs, Beth Koehler Diehl, Individually, etc., et al., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

438 F.2d 705 (1971)

Kent B. DIEHL, Sr., et al., Plaintiffs Beth Koehler Diehl, Individually, etc., et al., Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.

No. 29022.

United States Court of Appeals, Fifth Circuit.

February 18, 1971.

COPYRIGHT MATERIAL OMITTED

Dougal C. Pope, Donald G. Ritter, Houston, Tex., for plaintiffs-appellants.

Johnnie M. Walters, Lee A. Jackson, Asst. Attys. Gen., Tax Division, U. S. Dept. of Justice, Washington, D. C., Crombie J. D. Garrett, Ann E. Belanger. Attys., Dept. of Justice, Tax Div., Washington, D. C., Jerry Wells, Tax Div., Dept. of Justice, Fort Worth, Tex., Charles K. Ruth, Asst. U. S. Atty., Beaumont, Tex., for defendant-appellee; Roby Hadden, U. S. Atty., of counsel.

Before COLEMAN, INGRAHAM, and WILKEY^*, Circuit Judges.

COLEMAN, Circuit Judge:

This appeal presents three questions: (1) whether Mrs. Beth Koehler Diehl was estopped in the State of Texas from claiming to be the lawful widow of Kent B. Diehl, deceased; (2) whether her appointment as independent executrix of Diehl's estate by the County Court of Harris County, Texas, was void; and (3) whether either she as independent executrix, or a temporary administrator subsequently appointed, could be substituted as party plaintiff in a suit originally filed by the decedent for the refund of federal income taxes allegedly due the estate from a claimed overpayment in 1957. The District Court held against Mrs. Diehl and the temporary administrator on all points. They appeal. We affirm.

On September 27, 1962, Kent B. Diehl, Sr., formerly a resident of Orange County, Texas, more recently a resident of California, filed suit in the United States District Court at Beaumont, Texas, for a refund of $5,548.21 federal income taxes paid for the year 1957. The Government had already brought criminal proceedings against Diehl for alleged evasion of 1957 taxes. The District Court stayed all proceedings on the refund suit pending the disposition of the criminal charges. Mr. Diehl was suffering from a heart condition and secured several delays of a criminal trial on that account. On September 22, 1966, he died of a heart attack and the criminal prosecution was dismissed.

Some sixty days later, December 8, 1966, without mentioning Diehl's death, Beth Koehler Diehl moved to intervene as a plaintiff in the refund suit, alleging that she filed a joint return with the deceased in 1957, paid $5,548.21 in taxes which represented community property, and that she was entitled to ½ of any refund which might be recovered. Leave to intervene was promptly granted.

On February 13, 1967, Mrs. Diehl moved to be substituted as one of the plaintiffs in the place of Kent B. Diehl, Sr., alleging that he had died on September 22, 1966, and that she had been appointed independent executrix of the estate on January 24, 1967. This motion was granted.

In August, 1967, the Government counterclaimed in the amounts of $499,337.95 federal income taxes, $249,688.97 civil fraud penalties, and $249,688.97 interest for the year 1957.

On May 20, 1968, the Government filed a sworn motion to vacate the order which had substituted Beth Diehl, independent executrix, as a party plaintiff. The motion was based on certain facts stated not to have been known to the Government, and unknown to the Court, when the substitution order had been granted.

The Government's motion to vacate asserted that Mrs. Diehl's application for letters testamentary in the County Court of Harris County, Texas, was false and fraudulent, and was by her knowingly and wilfully made, in the following particulars:

1. The application alleged that Kent B. Diehl, Sr. was domiciled in Harris County, Texas, at the time of his death, whereas, in fact, Diehl moved to Pittsburg, Kansas, in 1959. He resided there until 1961, at which time he moved his permanent residence to Glendale, California, where he died at the Glendale Memorial Hospital on September 22, 1966;

2. The applicant asserted that she was the wife of Kent B. Diehl, Sr. at the time of his death and that she was his widow at the time of the filing of the proceedings in Harris County, whereas, in fact, on October 28, 1959, at her suit, she obtained a divorce from Kent B. Diehl, Sr. in Jaurez, Mexico, with both husband and wife being represented by counsel in the proceedings. Subsequently thereto, on November 26, 1959, at Joplin, Missouri, Diehl married Carmen Ramsey, with whom he was living as husband and wife in California at the date of his death;

3. That Mrs. Beth Koehler Diehl specifically represented in her Harris County application that Kent B. Diehl, Sr. was never divorced, making no mention of the Juarez divorce. Section 81(a) (9) of the Texas Probate Code, V.A.T.S. requires a petition for probate to state whether a decedent was ever divorced.

Upon examination of the record, we find these sworn allegations to have been undisputed except that in her application to the Harris County Court Mrs. Diehl as to the residency of the deceased added the words, "based on Applicant's understanding of the law". The statement that the deceased was never divorced was not qualified in any respect whatsoever.

It may be also pointed out that under § 69 of the Texas Probate Code if a testator is divorced after making a will all provisions of that will affecting the previous spouse, including appointing her as a fiduciary, are rendered null and void. Mrs. Diehl's testimony by deposition revealed that she knew Kent B. Diehl, Sr., resided in California at the time of his death and, in fact, the undisputed allegations of the Government's motion to vacate shows that Mrs. Diehl's income tax returns for the calendar years 1959, 1960, 1961, 1962, 1963, 1964, 1965, and 1966 were all prepared by the attorney who represented her former husband in his income tax troubles, who had filed the refund suit in 1962, and who represented her both in the County Court of Harris County and the United States District Court in these motions to intervene and for substitution as a party plaintiff. Mrs. Diehl attempted to claim that Diehl's visits to Houston to confer with his attorney about his income tax cases created a domicile in Harris County. The District Court correctly rejected this contention.

The District Court found that deliberate misrepresentations had been made to the County Court, intended to lead that Court to believe that the deceased resided in Harris County and that Beth K. Diehl was his widow, without which that Court would have held that it had no jurisdiction. These findings are amply supported in the evidence and are not clearly erroneous.

Mrs. Diehl defended her position in the District Court on the ground that the Mexican divorce was invalid, therefore she was the widow of the deceased. This is clearly untenable and a 1954 decision of the Texas Court of Civil Appeals put her and her counsel on definite notice to that effect. The situation here is in no wise dissimilar to that in Dunn v. Tiernan, 284 S.W.2d 754 (Tex.Civ. App., 1955), in which it was settled in Texas that a party who seeks and obtains a Mexican divorce is thereafter estopped to deny its validity under the circumstances described in that opinion. To like effect, see Johnson v. Muelberger, 1951, 340 U.S. 581, 71 S.Ct. 474, 95 L.Ed. 552 (Florida divorce — full faith and credit); Perrin v. Perrin, 3 Cir., 1969, 408 F.2d 107 (Mexican divorce — both parties appearing — comity).

In the light of these facts, the District Court further held that the judgment of the Harris County Court naming Beth Koehler Diehl executrix of the estate of Kent B. Diehl, Sr. was void and not entitled to full faith and credit because it had been procured by fraud. The Court further held that in filing the application for substitution as a party plaintiff in the alleged capacity of executrix of the estate of the deceased Mrs. Diehl had likewise perpetrated a fraud upon the District Court. The order allowing Mrs. Diehl to intervene as a party plaintiff in her capacity as executrix was vacated.

This action was free of error. The deceased had no domicile in Texas, his domicile was in California, he had no fixed place of residence in Texas, he had no next of kin nor any property in Texas. The Probate Court of Harris County was led to believe that it had jurisdiction by the misrepresentations already alluded to. Mrs. Diehl was estopped to contend that she was the widow of the deceased. Under the circumstances of this case the District Court was not required to give full faith and credit to the Harris County judgment admitting the will to probate and appointing Mrs. Diehl as executrix. Where jurisdiction depends upon domicile that question is always open to re-examination, even upon contradictory evidence, Burbank...