Ryan v. United States, 6184.

• Decision Date: 17 November 1930
• Docket Number: No. 6184.,6184.
• Citation: 44 F.2d 951
• Parties: RYAN v. UNITED STATES.
• Court: U.S. Court of Appeals — Ninth Circuit

44 F.2d 951 (1930)

RYAN v. UNITED STATES.

No. 6184.

Circuit Court of Appeals, Ninth Circuit.

November 17, 1930.

George D. Toole and C. S. Wagner, both of Butte, Mont., for appellant.

Wellington D. Rankin, U. S. Atty., and Howard A. Johnson and Arthur P. Acher, Asst. U. S. Attys., all of Helena, Mont.

Before RUDKIN and WILBUR, Circuit Judges, and JAMES, District Judge.

RUDKIN, Circuit Judge.

This was a proceeding by information to forfeit bar fixtures and other articles of personal property found in a soft drink parlor where intoxicating liquors, in respect whereof a tax was then and there due and unpaid, were kept and sold. The proceedings were instituted under section 3453 of the Revised Statutes (26 USCA § 1185), which provides as follows:

"All goods, wares, merchandise, articles, or objects, on which taxes are imposed, which shall be found in the possession, or custody, or within the control of any person for the purpose of being sold or removed by him in fraud of the internal-revenue laws, or with design to avoid payment of said taxes, may be seized by the collector or deputy collector of the proper district, or by such other collector or deputy collector as may be specially authorized by the Commissioner of Internal Revenue for that purpose, and shall be forfeited to the United States. And all raw materials found in the possession of any person intending to manufacture the same into articles of a kind subject to tax for the purpose of fraudulently selling such manufactured articles, or with design to evade the payment of said tax; and all tools, implements, instruments, and personal property whatsoever, in the place or building, or within any yard or inclosure where such articles or raw materials are found, may also be seized by any collector or deputy collector, as aforesaid, and shall be forfeited as aforesaid. The proceedings to enforce such forfeitures shall be in the nature of a proceeding in rem in the district court of the United States for the district where such seizure is made."

This section, enacted in 1866 (14 Stat. 111), was amendatory of section 48 of the Act of June 30, 1864 (13 Stat. 240). By the earlier act, the forfeiture, save as to goods, wares, merchandise, articles, or objects on which taxes were imposed, and raw materials, was limited to "* * * tools, implements, instruments, and personal property whatsoever, in the place or building, or within any yard or enclosure where such articles on which duties are imposed, as aforesaid, and intended to be used by them in the fraudulent manufacture of such raw materials, shall be found. * * *"

It will be observed that by the amendment, or in the revision, the limitation in regard to the intended use of the tools, implements, instruments, and personal property was left out.

Although the amended section has been in effect for upwards of sixty years, the provision in regard to the forfeiture of personal property has never been construed by the Supreme Court or by any Circuit Court of Appeals, so far as we are advised, and the decisions of the Circuit and District Courts, both early and late, are in hopeless conflict. Thus, in United States v. Thirty-three Barrels of Spirits, 28 Fed. Cas. page 72, No. 16,470, decided in 1868, Judge Lowell said:

"The new statute amends the phraseology of this section in several other particulars, without perhaps much variation of the meaning, but omits altogether the qualifications of intended use of the tools, implements, instruments, and personal property, and upon a literal interpretation might seem to subject to seizure and forfeiture all goods and chattels and other things coming within the very general description of personal property, to whomsoever they may...