Sage v. United States

Citation63 L.Ed. 828,39 S.Ct. 415,250 U.S. 33
Decision Date19 May 1919
Docket NumberNo. 344,344
PartiesSAGE et al. v. UNITED STATES
CourtUnited States Supreme Court

Mr. H. T. Newcomb, of New York City, for appellants.

Mr. Solicitor General Alex. C. King, of Atlanta, Ga., for the United States.

[Argument of Counsel from pages 33-36 intentionally omitted] Mr. Justice HOLMES delivered the opinion of the Court.

This is a claim under the Acts of June 27, 1902, c. 1160, § 3, 32 Stat. 406, and of July 27, 1912, c. 256, 37 Stat. 240, to have refunded a tax collected under the Act of June 13, 1898, c. 448, § 29, 30 Stat. 448, 464, 465, upon legacies to the wife and children of the testator Dean Sage. The petition was dismissed by the Court of Claims on demurrer. The testator died domiciled in New York on June 23, 1902, so that the debts of the estate were not ascertained and, as decided in McCoach v. Pratt, 236 U. S. 562, 35 Sup. Ct. 421, 59 L. Ed. 720; the legacies were not 'absolutely vested in possession or enjoyment' before July 1, 1902, and therefore by the terms of the Act of 1902 were not subject to the tax under the above mentioned § 29. A tax of $63,940.88 was collected, however, in June, 1903. On August 24, 1903, an application to have it refunded on the ground that the legacies were not subject to taxation under § 29 was made to the Commissioner of Internal Revenue, but was denied in the following month. Two years later the petitioners sued the Collector and in May, 1912, got judgment for $30,275.49, with interest and costs, which was satisfied by the United States. McCoach v. Pratt, supra, and United States v. Jones, 236 U. S. 106, 35 Sup. Ct. 261, 59 L. Ed. 488, Ann. Cas. 1916A, 316, had not been decided at that time and it was held that some of the interests were vested in enjoyment. Ward v. Sage, 185 Fed. 7, 108 C. C. A. 413. This suit is for the unrepaid residue and was begun on January 23, 1917. The Government contends that the judgment and also the Act of July 27, 1912, c. 256, § 1, 37 Stat. 240, are bars to the present claim.

The former judgment is not a bar. It is true that the statutes modify the common law liability for money wrongfully collected by duress so far as to require a preliminary appeal to the Commissioner of Internal Revenue before bringing a suit. Rev. St. § 3226 (Comp. St. § 5949). It is true also that it is the duty of the District Attorney to appear for the collector in such suits, Rev. St. 771 (Comp. St. § 1296); that the judgment is to be paid by the United States and the collector is exempted from execution if a certificate is granted by the Court that there was probable cause for his act, Rev. St. § 989 (Comp. St. § 1635); and that there was a permanent appropriation for the refunding of taxes illegally collected. Rev. St. § 3689 (17) (Comp. St. § 6799). No doubt too, if it appeared in a suit against a collector who had acted with probable cause and had turned over his money to the United States, that a part of the tax properly was due to the United States, unnecessary formalities might be omitted and the sum properly due might be retained. Of course, the United States in such a case could not require a second payment of that sum. Crocker v. Malley, March 17, 1919. 249 U. S. 223, 39 Sup. Ct. 270, 63 L. Ed. 573. But no one could contend that technically a judgment of a District Court in a suit against a collector was a judgment against or in favor of the United States. It is hard to say that the United States is privy to such a judgment or that it would be bound by it if a suit were brought in the Court of Claims. The suit is personal and its incidents, such as the nature of the defenses open and the allowance of interest, are different. It does not concern property in which the United States asserts an interest on its own behalf or as trustee, as in Minnesota v. Hitchcock, 185 U. S. 373, 388, 22 Sup. Ct. 650, 46 L. Ed. 954. At the time the judgment is entered the United States is a stranger. Subsequently the discretionary action of officials may, or it may not, give the United States a practical interest in the amount of the judgment, as determining the amount of a claim against it, but the claim would arise from the subsequent official act, not from the judgment itself. United States v Frerichs, 124 U. S. 315, 8 Sup. Ct. 514, 31 L. Ed. 471. But perhaps it would be enough to say that if the judgment otherwise were a bar the bar would be removed by the subsequent enactment of the Act of July 27, 1912, c. 256, 37 Stat. 240, upon which, as well as the Act of 1902, this claim is based.

The Act of July 27, 1912, after providing in § 1 for the presentation of claims for taxes erroneously collected under the above...

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    • United States
    • U.S. District Court — Southern District of California
    • 30 Octubre 1953
    ...U.S.C. § 1340. See: Lowe Bros. Co. v. United States, 1938, 304 U.S. 302, 305, 58 S.Ct. 896, 82 L.Ed. 1362; Sage v. United States, 1919, 250 U.S. 33, 37, 39 S.Ct. 415, 63 L.Ed. 828; 28 U.S.C. § 2006 and Reviser's note following § 1346, 28 The original complaint was dismissed upon motion for ......
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    • United States
    • U.S. Court of Appeals — Fifth Circuit
    • 6 Abril 1942
    ...1265. The broad language in this case, however, is to be taken with caution in view of the earlier case of Sage v. United States, 250 U.S. 33, 37, 39 S.Ct. 415, 63 L.Ed. 828, where it was held that a judgment against the Collector is not technically one against the United States and that th......
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    • 24 Junio 1941
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