U.S. v. Brown, 75-2175

• Decision Date: 02 June 1976
• Docket Number: No. 75-2175,75-2175
• Citation: 536 F.2d 117
• Parties: 76-1 USTC P 9453 UNITED STATES of America et al., Plaintiffs-Appellees, v. Charles H. BROWN, Defendant-Appellant.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 117

536 F.2d 117

76-1 USTC P 9453

UNITED STATES of America et al., Plaintiffs-Appellees, v. Charles H. BROWN, Defendant-Appellant.

No. 75-2175.

United States Court of Appeals Sixth Circuit.

Argued April 2, 1976.

Decided June 2, 1976.

Stanley R. Kirk, Patmon, Young & Kirk, Detroit, Mich., for defendant-appellant.

Ralph B. Guy, Jr., U. S. Atty., Detroit, Mich., Scott P. Crampton, Gilbert Andrews, Appellate Section, Tax Div., Dept. of Justice Robert E. Lindsay, Daniel F. Ross, Robert A. Bernstein, Washington, D. C., for plaintiffs-appellees.

Before WEICK, McCREE, and MILLER, ^* Circuit Judges.

McCREE, Circuit Judge.

This appeal requires us to decide whether section 7602 of the Internal Revenue Code of 1954, which provides for the examination and production of "books, papers, records, or other data," authorizes the Internal Revenue Service to compel a taxpayer, who has otherwise complied with the requirements of a routine audit, to appear before an IRS special agent in order to write, in his presence and at his direction, taxpayer's former wife's signature twenty-five times. We hold that § 7602 does not authorize this production of handwriting exemplars not yet in existence.

Brown was summoned to appear before an IRS special agent to give personal handwriting exemplars and testimony relating to the preparation of his 1972 income tax return, pursuant to Int.Rev.Code of 1954, § 7602 (26 U.S.C. § 7602), which provides:

For the purpose of ascertaining the correctness of any return, making a return where none has been made, determining the liability of any person for any internal revenue tax or the liability at law or in equity of any transferee or fiduciary of any person in respect of any internal revenue tax, or collecting any such liability, the Secretary or his delegate is authorized

(1) To examine any books, papers, records, or other data which may be relevant or material to such inquiry;

(2) To summon the person liable for tax or required to perform the act, or any officer or employee of such person, or any person having possession, custody, or care of books of account containing entries relating to the business of the person liable for tax or required to perform the act, or any other person the Secretary or his delegate may deem proper, to appear before the Secretary or his delegate at a time and place named in the summons and to produce such books, papers, records, or other data, and to give such testimony, under oath, as may be relevant or material to such inquiry; and

(3) To take such testimony of the person concerned, under oath, as may be relevant or material to such inquiry.

The facts as found by the district court are not disputed. The IRS had been conducting an investigation to determine Brown's correct income tax liability for the year 1972. After the audit, the IRS received information that what appeared to be the signature of appellant's former wife, Sharon Brown, on the joint return filed by appellant and his wife for 1972, was a forgery. Thereupon, James Budde, a special agent assigned to the Intelligence Division of the IRS, launched an investigation.

On September 27, 1974, Budde obtained and served an administrative summons, directing Sharon Brown to appear and testify about the circumstances surrounding the filing of the 1972 return. Appellant then filed suit in district court against Sharon Brown and the IRS, and he obtained an injunction prohibiting his former wife from testifying in a manner that would violate the confidential marital privilege.

On January 13, 1975, Budde served an administrative summons upon appellant, directing him to give handwriting exemplars of Sharon's signature and testimony relating to the 1972 joint tax return. ¹ On January 20, 1975, Brown appeared in answer to the summons, but refused to produce the signatures as required by its terms. This enforcement action was then begun on June 30, 1975 by the IRS pursuant to 26 U.S.C. § 7604. ² Enforcement was granted on July 31, 1975, ³ and this appeal followed.

As the district court recited, appellant has not challenged the underlying relevancy or materiality of the exemplars sought by the summons. ⁴ Brown's challenge to its enforcement is premised solely on the ground that § 7602 does not authorize the production of handwriting exemplars not in existence.

In pertinent part, § 7602 sanctions use of a summons "(2) . . . to produce such books, papers, records, or other data, and to give such testimony, under oath, as may be relevant or material" to a legitimate tax investigation. Since there is no question that Brown's testimony may be compelled pursuant to § 7602(2), the only question is whether handwriting exemplars not in existence constitute "other data" within the meaning of the statute.

It is the government's contention that when Congress used the general phrase "other data," it intended to empower the IRS to summon any "constitutionally permissible information," including handwriting exemplars, to carry out its investigation. The government argues that the summons power of the IRS should be construed liberally because of its investigatory purpose. United States v. Widelski, 452 F.2d 1, 4 (6th Cir. 1971), cert. denied, 406 U.S. 918, 92 S.Ct. 1769, 32 L.Ed.2d 117 (1972).

The district judge followed United States v. Campbell, 390 F.Supp. 711 (D.S.D.1975) since affirmed in 524 F.2d 604 (8th Cir. 1975), and interpreted § 7602(2) as authorizing the IRS to require a taxpayer to create handwriting exemplars. We decline to follow the construction given to the statute by the Eighth Circuit, and we reverse the district court.

The government's interpretation of § 7602 does not follow from a consideration of the statute as a whole. In subsection (1), (§ 7602 is set out in full supra ), the Secretary or his delegate is authorized "(t)o examine any books, papers, records, or other data which may be relevant or material" to the investigation in question. (Emphasis added.) In subsection (2) the Secretary or his delegate is authorized to summon any person deemed to have relevant information to appear before the Secretary "to produce such books, papers, records, or other data." (Emphasis added.) The first subsection authorizes the Secretary to examine specified documents, but does not authorize him to order the making of any items not in existence. If the Congress had intended to give the Secretary the authority to direct the manufacture of new documents, it would have used appropriate language. Since it is "fundamental that a section of a statute should not be read in isolation from the context of the whole (statute)," Richards v. United States, 369 U.S. 1, 11, 82 S.Ct. 585, 591, 7 L.Ed.2d 492, 499 (1962), the "books, papers, records, or other data" to be produced in subsection (2) are those which may be examined in subsection (1). We therefore conclude that the Congress did not authorize the Secretary to require the manufacture of documents or other data for his examination.

The government's interpretation of "books, papers, records, or other data" is contrary to the well established doctrine of statutory construction, ejusdem generis. See 2A Sutherland, Statutes and Statutory Construction §§ 44.16-44.18 (4th ed. 1973). Literally, ejusdem generis means of the same kind, class, or nature. Black's Law Dictionary 608 (rev. ed. 1968). In the application of ejusdem generis, unless a statute otherwise indicates, where a listing of particular or specific objects is followed by general words to indicate that the list is incomplete, the general words will not be construed broadly, but will be limited to include only objects of the same kind or class specifically enumerated.

In Weyerhaeuser Steamship Co. v. United States, 372 U.S. 597, 600-601, 83 S.Ct. 926, 928, 10 L.Ed.2d 1, 4 (1963), the Supreme Court stated that "the traditional rule of statutory construction . . . counsels against giving to general words a meaning totally unrelated to the more specific terms of a statute." In Weyerhaeuser, the Court was concerned with the interpretation of then section 7(b) of the Federal Employees' Compensation Act, which provided in relevant part that the government's liability for

injury or death of an employee shall be exclusive, and in place, of all other liability of the United States or such instrumentality to the employee, his legal representative, spouse, dependents, next of kin, and anyone otherwise entitled to recover damages from the United States . . . . 5 U.S.C. § 757(b) ⁵.

The issue was whether the petitioner, a ship owner, was to be included in the general phrase, "anyone otherwise entitled to recover damages." The government, seeking to limit its liability, argued that the petitioner was included in the broad class of "anyone otherwise entitled . . . ." Nevertheless, the Court held that this general language had to be construed in the context of the explicit enumeration of "employees, their representatives, their dependents, and next of kin," and that the petitioner did not fall within this general class.

Section 7602 does not provide a definition of the phrase "other data." In its brief, the government interprets "other data" to include any "constitutionally permissible information." However, it is a "familiar canon of statutory construction that such (catchall terminating) clauses are to be read as bringing within the statute categories similar in type to those specifically enumerated." Federal Maritime Commission v. Seatrain Lines,, 411 U.S. 726, 734, 93 S.Ct. 1773, 1779, 36 L.Ed.2d 620, 627 (1973).

If Congress had intended the words "other data" to be interpreted in an unrestricted sense, it could easily have said so by adding words such as "of whatever kind whether in existence or not." We hold that the word "other" following this enumeration of particular items ought to be read as "other of a like kind." The statutory language conferring the power to "examine any books, papers, records, or other data...