Falik v. United States, No. 368

CourtUnited States Courts of Appeals. United States Court of Appeals (2nd Circuit)
Writing for the CourtWATERMAN, FRIENDLY and HAYS, Circuit
Citation343 F.2d 38
PartiesRena FALIK, Plaintiff-Appellee, v. The UNITED STATES of America, Defendant-Appellant.
Decision Date18 March 1965
Docket NumberDocket 29396.,No. 368

343 F.2d 38 (1965)

Rena FALIK, Plaintiff-Appellee,
v.
The UNITED STATES of America, Defendant-Appellant.

No. 368, Docket 29396.

United States Court of Appeals Second Circuit.

Argued February 19, 1965.

Decided March 18, 1965.


343 F.2d 39

Joseph Kovner, Washington, D. C. (Louis F. Oberdorfer, Asst. Atty. Gen., Lee A. Jackson, George F. Lynch, Washington, D. C., Joseph P. Hoey, U. S. Atty., George L. Barnett, Asst. U. S. Atty., of counsel), for defendant-appellant.

Robert E. Scher, New York City, (Raphael, Searles & Vischi, New York City, Sidney O. Raphael, New York City, of counsel), for plaintiff-appellee.

Before WATERMAN, FRIENDLY and HAYS, Circuit Judges.

FRIENDLY, Circuit Judge.

Mrs. Falik brought this action in April, 1962, in the District Court for the Eastern District of New York to remove a tax lien of the United States as a cloud on the title to her home at Woodmere, Long Island. The lien was for withholding and social security taxes due from two corporations, of which the Commissioner of Internal Revenue had found her to have been a responsible officer, see Internal Revenue Code of 1954, §§ 3102, 3403, 6672;1 Mrs. Falik alleged that this finding was erroneous. The United States made a motion to dismiss for want of jurisdiction, amplified by an accompanying affidavit which spoke of sovereign immunity and the bar against injunctive or declaratory tax relief; Judge Dooling denied the motion, 206 F.Supp. 181 (1962). Two and a half years later the Government made a second motion to dismiss for want of jurisdiction or other appropriate relief, citing decisions in other districts contrary to Judge Dooling's; the motion contained a request that, in the event of denial, the judge should grant a certificate for an interlocutory appeal under 28 U.S.C. § 1292(b). Judge Dooling denied the motion but granted the certificate. Recognizing that the issue was one of importance in the administration of the revenue laws, on which district courts have differed; that this difference was due in some measure to our having accepted an argument of the Government in Pipola v. Chicco, 274 F.2d 909 (2 Cir. 1960), which, at the Government's urging, we branded as erroneous in United States v. O'Connor, 291 F.2d 520 (2 Cir. 1961); that failure to allow an interlocutory appeal followed by a victory by the Government on the merits might

343 F.2d 40
moot the issue that we ought to determine; and that a reversal would "materially advance the ultimate termination of the litigation," we granted leave for an interlocutory appeal

The district court had subject-matter jurisdiction over the action as one "arising under any Act of Congress providing for internal revenue * * *." 28 U.S.C. § 1340. While 28 U.S.C. § 2410(a) does not create a new "federal" claim, contrast § 7424, the present suit nevertheless does "arise under" the revenue laws because Mrs. Falik's liability as a responsible officer depends directly on the "construction or effect" of certain of those laws. United States v. Coson, 286 F.2d 453, 456-458 (9 Cir. 1961); contrast Remis v. United States, 273 F.2d 293 (1 Cir. 1960). However, 28 U.S.C. § 1340 alone would not enable the plaintiff to surmount the bars created by sovereign immunity and by the historic prohibitions against injunctions or declaratory relief in federal tax matters, § 7421, 28 U.S.C. § 2201. For this purpose she relies upon 28 U.S.C. § 2410(a), by which the United States consents to "be named a party in any civil action or suit in any district court, or in any State court having jurisdiction of the subject matter, to quiet title to or for the foreclosure of a mortgage or other lien upon real or personal property on which the United States has or claims a mortgage or other lien."2 The lien is obviously a "cloud" on the title and on a literal reading of the section it is difficult to see why the district court could not grant Mrs. Falik the relief she asks. But the Government urges with force that such adherence to the letter is forbidden by considerations of history and policy, and we are persuaded that the present action is not one contemplated by 28 U.S.C. § 2410(a), and cannot be entertained on any other ground.

We do not consider either of our cited decisions to be dispositive. Pipola v. Chicco, supra, was a state court action by purchasers of real estate who, because of error by a title searcher, had failed to receive notice of a duly filed United States tax lien; the United States removed and counterclaimed for foreclosure of the lien, under what is now § 7403, which the district court granted. The case came to us on the assumption, not seriously contested by the Government, 274 F.2d at 911, that in a formal sense the action initiated by the Pipolas was within 28 U.S.C. § 2410(a). The issue, see fn. 3 on that page, was "the scope of the inquiry into the validity of tax liens permitted" under the circumstances. The Government argued that the validity of the assessment could not be examined because (1) this could not be done even in a suit by it to enforce a lien against a taxpayer under what is now § 7403, (2) the taxpayer ought stand no better in a suit initiated by him under 28 U.S.C. § 2410(a), and (3) it could not have been intended that a third person should stand better than the taxpayer under either section. Although expressing surprise at the lack of decisions to support the first proposition, 274 F.2d at 912, we adopted it on the basis of a dictum in Bull v. United States, 295 U.S. 247, 259-261, 55 S.Ct. 695, 79 L.Ed. 1421 (1935), of our unwarranted confidence in the Government's presentation on a matter of tax administration, and of the lack of citation of contrary authority. Once that proposition was accepted, the others seemed to follow. Later, in United States v. O'Connor, supra, a suit under § 7403 to enforce a lien against the taxpayer, the United States urged that the first proposition of its argument in Pipola was in error, as the authorities and the history unearthed by its research demonstrated. Overruling what we had said in Pipola on that score, we declined to pass, one way or the other, on the Government's contention that the actual decision in that case...

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78 practice notes
  • Brewer v. US, No. 90 Civ. 3423 (GLG).
    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
    • 21 May 1991
    ...Act does not authorize a taxpayer to challenge an IRS assessment of his tax liability, id. at 733; see Falik v. United States, 343 F.2d 38, 42 (2d Cir.1965), the taxpayer is not precluded from bringing an action under 28 U.S.C. § 2410(a)(1) to challenge procedural irregularities in the seiz......
  • King v. United States, No. 248-65.
    • United States
    • Court of Federal Claims
    • 16 February 1968
    ...in other leading cases in the area since no reference is made to the Declaratory Judgment Act. See, e. g., Falik v. United States, 343 F.2d 38 (C.A.2, 15 In Dismuke v. United States, 297 U.S. 167, 56 S.Ct. 400, 80 L.Ed. 561 (1936), affirming on other grounds 76 F.2d 715 (C.A.5, 1935), the C......
  • Pollinger v. U.S., Civil Action No. 06-1885 (CKK).
    • United States
    • U.S. District Court — District of Columbia
    • 25 March 2008
    ...from contesting the merits of the underlying tax assessment itself." Id. at 939-40 (emphasis added); see also Falik v. United States, 343 F.2d 38 (2d Cir.1965). Indeed, "[t]he principle that a taxpayer cannot use section 2410(a) to challenge the extent of, or existence of, substantive tax l......
  • In Re Robert F. Rae, Bankruptcy No. 09-23646 (ASD).
    • United States
    • United States Bankruptcy Courts. Second Circuit. U.S. Bankruptcy Court — District of Connecticut
    • 25 August 2010
    ...from contesting the merits of the underlying tax assessment itself.” Aqua Bar & Lounge, supra at 939-40; see also, Falik v. United States, 343 F.2d 38 (2d Cir.1965). Because the Plaintiff is contesting not only the validity of the IRS' liens but also the validity of the tax assessment that ......
  • Request a trial to view additional results
78 cases
  • Brewer v. US, No. 90 Civ. 3423 (GLG).
    • United States
    • United States District Courts. 2nd Circuit. United States District Courts. 2nd Circuit. Southern District of New York
    • 21 May 1991
    ...Act does not authorize a taxpayer to challenge an IRS assessment of his tax liability, id. at 733; see Falik v. United States, 343 F.2d 38, 42 (2d Cir.1965), the taxpayer is not precluded from bringing an action under 28 U.S.C. § 2410(a)(1) to challenge procedural irregularities in the seiz......
  • King v. United States, No. 248-65.
    • United States
    • Court of Federal Claims
    • 16 February 1968
    ...in other leading cases in the area since no reference is made to the Declaratory Judgment Act. See, e. g., Falik v. United States, 343 F.2d 38 (C.A.2, 15 In Dismuke v. United States, 297 U.S. 167, 56 S.Ct. 400, 80 L.Ed. 561 (1936), affirming on other grounds 76 F.2d 715 (C.A.5, 1935), the C......
  • Pollinger v. U.S., Civil Action No. 06-1885 (CKK).
    • United States
    • U.S. District Court — District of Columbia
    • 25 March 2008
    ...from contesting the merits of the underlying tax assessment itself." Id. at 939-40 (emphasis added); see also Falik v. United States, 343 F.2d 38 (2d Cir.1965). Indeed, "[t]he principle that a taxpayer cannot use section 2410(a) to challenge the extent of, or existence of, substantive tax l......
  • In Re Robert F. Rae, Bankruptcy No. 09-23646 (ASD).
    • United States
    • United States Bankruptcy Courts. Second Circuit. U.S. Bankruptcy Court — District of Connecticut
    • 25 August 2010
    ...from contesting the merits of the underlying tax assessment itself.” Aqua Bar & Lounge, supra at 939-40; see also, Falik v. United States, 343 F.2d 38 (2d Cir.1965). Because the Plaintiff is contesting not only the validity of the IRS' liens but also the validity of the tax assessment that ......
  • Request a trial to view additional results

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