In re Keegan
| Decision Date | 05 March 1937 |
| Citation | 18 F. Supp. 746 |
| Parties | In re KEEGAN. |
| Court | U.S. District Court — Southern District of New York |
Fox & Wintner, of New York City (Robert J. Fox, of New York City, Harvey D. Jacob, of Washington, D. C., and Robert P. Schur, of New York City, of counsel), for petitioner.
Lamar Hardy, U. S. Atty., of New York City (Jay Slonim, Asst. U. S. Atty., of New York City, of counsel), for respondent.
A summons was served on Keegan, requiring him to appear before one Kunkel, an internal revenue agent, and testify as to the matter of the tax liability of a company by the name of Compania Navira Nacional. In issuing the summons the revenue officers assumed to be acting under authority of section 618 of the Revenue Act of 1928 (26 U.S.C.A. § 1514), to the effect that the Commissioner of Internal Revenue, in order to ascertain the correctness of any return or to make a return when none has been made, may by any officer or employee designated examine records and require attendance and take testimony of any person with knowledge in the premises. Keegan appeared in response to the summons and was sworn. After a few preliminary questions he was asked what records of customers' accounts were kept by a firm of bond dealers of which he was a partner. He declined to answer, stating that he had been harassed enough by agents coming repeatedly to his office and asking the same questions over and over. So the examination ended.
Kunkel then came here and asked for an order to compel Keegan to testify. By section 617(a) of the 1928 Act (26 U.S.C.A. § 1523), the District Court may compel a person to attend and testify in obedience to such a summons. Kunkel's petition showed the matters already stated. It also alleged that the inquiry concerned the tax liability of several others, in addition to Compania Navira Nacional, from 1916 to 1933, and that Keegan's firm had had financial dealings with several of the taxpayers under investigation. On the petition the court on January 20, 1937, issued an ex parte order directing Keegan to appear and give testimony in the matter of the tax liability of the named taxpayers. Keegan then made a motion to vacate the order. The moving papers state his belief that all the taxpayers concerned have paid all taxes truly owed by them, that the time for assessing taxes against them has expired, and that the order requiring him to testify is contrary to the Fourth Amendment. Keegan also stated in an affidavit in support of his motion that prior to the service of the summons three internal revenue agents had visited him frequently at his office, had asked him numerous questions which he had answered, and had asked for firm records which he had produced. It is further shown that a matter of assessment of tax against one of the taxpayers, Interocean Oil Company, for 1917-1921 is now pending before the Board of Tax Appeals.
The papers submitted in opposition indicate that the inquiry as to tax...
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Foster v. United States
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