U.S. v. Greenlee

• Decision Date: 28 May 1975
• Docket Number: No. 74-2106,74-2106
• Citation: 517 F.2d 899
• Parties: 75-1 USTC P 9488 UNITED STATES of America v. James W. GREENLEE, Appellant.
• Court: U.S. Court of Appeals — Third Circuit

Page 899

517 F.2d 899

75-1 USTC P 9488

UNITED STATES of America v. James W. GREENLEE, Appellant.

No. 74-2106.

United States Court of Appeals Third Circuit.

Argued April 15, 1975.

Decided May 28, 1975.

Stanford Shmukler, Philadelphia, Pa., for appellant.

Robert E. J. Curran, U. S. Atty., Richard R. Galli, Asst. U. S. Atty., Philadelphia, Pa., for appellee.

Before SEITZ, Chief Judge, ROSENN and WEIS, Circuit Judges.

OPINION OF THE COURT

SEITZ, Chief Judge.

Defendant James W. Greenlee appeals from his conviction, after a jury trial, of willfully failing to file income tax returns for the tax years 1970 and 1971 in violation of 26 U.S.C. § 7203 (1970).

Many facts are undisputed and may be briefly summarized. Defendant, an attorney, was employed in 1970-71 by an agency of the City of Philadelphia and earned sufficient income to require the filing of an income tax return for each of those years. However, Internal Revenue Service records reflect no return for defendant for the tax year 1970. With respect to the 1971 return, defendant was granted an extension for filing until May 19, 1972, a notice of non-filing was sent to and received by him in September 1972, and the return was filed in an envelope postmarked December 28, 1972.

On December 26, 1972, defendant met with IRS Special Agent David Patella and was confronted with the fact that the IRS had no record of returns for either 1970 or 1971. At that time defendant stated that he had filed the 1970 return in a timely fashion and that he had mailed the 1971 return during the week prior to the meeting, both returns with taxes due but without remittances. The next day, defendant produced for the agent copies of both returns bearing information substantially corresponding to figures he had recited to the agent from memory at their first meeting.

The bulk of the government's testimony at trial was devoted to establishing the IRS procedures for handling returns and the operation of the Service's computer system. The prosecution relied for proof of non-filing of a 1970 return on a manually prepared "Certificate of Assessments and Payments" and a computer printed "Transcript of Account" for the tax year 1970. A one page excerpt from a list of names of non-filers for the tax year 1970 to whom notices of delinquency were allegedly sent in April 1972 was also offered into evidence by the prosecution in an effort to establish that the defendant had been informed that the IRS had no return for that year.

The government's evidence with respect to the 1971 return included copies of defendant's request for an extension for filing and its rejection, the September 1972 notice of non-filing and a 1971 Form 1040 signed by defendant with an attached envelope postmarked December 28, 1972. Special Agent Patella also testified concerning defendant's statements to him that the 1971 return was not filed until the week prior to their meeting of December 26, 1972. The prosecution's evidence was completed by the testimony of a postal official that there were normal collections at defendant's office on December 26-27, 1972, and that the earliest that an envelope postmarked December 28, 1972, could have been collected there was December 27, 1972.

The defendant and his wife testified in his behalf. The defendant claimed that he mailed the 1970 return late on the evening of April 15, 1971, and his wife verified that she signed the return on that date, that her husband left to mail it, and that he returned to describe the confusion at the post office.

The defendant attributed his late filing of the 1971 return to the complicated nature of the return and his total involvement during 1972 in an investigation of his employing agency. He maintained that he mailed the 1971 return at his office on December 24, 1972. The defense also called a taxpayer whose name appeared directly below that of defendant on the list of individuals to whom notices of non-filing for 1970 were purportedly sent. This witness testified that his return had been timely filed and a refund paid him, and that he had never received a notice that the IRS had no record of a return for him for 1970. A defense computer expert highlighted for the jury possible areas of error in both the input and retrieval aspects of the IRS record and computer systems.

Sufficiency of the Evidence

Defendant first asserts that the evidence was insufficient to establish beyond a reasonable doubt that the 1970 return was not filed and that the government failed to establish willfulness with respect to the failure to timely file either return. In examining the evidence to determine whether it is sufficient to support the jury verdict of guilty, we must view the evidence adduced in the light most favorable to the government. Glasser v. United States, 315 U.S. 60, 80, 62 S.Ct. 457, 86 L.Ed. 680 (1942); United States v. Cades, 495 F.2d 1166, 1169 (3rd Cir. 1974).

Defendant maintains that his testimony that he did in fact file the 1970 return is sufficient to overcome the government's evidence that it has no record of a return, and cites a number of civil cases in the United States Tax Court in support of his position, e. g., Harzi v. United States, 73-2 U.S.T.C 9712 (T.C.1973). In essence, defendant asks us to weigh evidence and judge credibility in the same manner as the Tax Court which sat as a fact-finder in those cases and determined that the government's negative evidence was insufficient to overcome the testimony of a taxpayer heard by the court and found to be credible.

Our function is considerably more limited. We neither weigh evidence nor judge the credibility of witnesses. These are matters for the jury. We consider only whether, taking the evidence in its most favorable view to the government, it would permit the jury to find this element established beyond a reasonable doubt. We conclude that the government's evidence that the IRS had no record of a return, when evaluated in light of the evidence as to the recordkeeping procedures of the Service, was sufficient to permit such a finding. The jury's decision to reject defendant's testimony to the contrary is not subject to appellate review. Government of Virgin Islands v. Gereau, 502 F.2d 914, 921 (3rd Cir. 1974), cert. denied, 420 U.S. 909, 95 S.Ct. 829, 42 L.Ed.2d 839 (1975).

We must also reject the contention that the evidence was insufficient to prove willfulness with respect to the failure to file in each of the two years. In our view, the defendant's arguments on this score misconceive the meaning of the word "willfully" in 26 U.S.C. § 7203 and its companion statutes, 26 U.S.C. §§ 7201-07, all of which use the word in the same sense. United States v. Bishop, 412 U.S. 346, 93 S.Ct. 2008, 36 L.Ed.2d 941 (1973). In the context of these statutes, the requirement that an act be done "willfully" means that it must have been activated by a "bad purpose or evil motive." Id. at 361, 93 S.Ct. 2008. A review of the evidence convinces us that the government established a willful failure to file under this standard.

Defendant was an attorney with a substantial income who the jury could infer should have been aware of his obligation to file timely tax returns and who had in fact filed such returns in previous years. The testimony of Special Agent Patella showed that defendant demonstrated an awareness of that obligation during his meetings with the agent. Yet, when construed most favorably to the government, the evidence shows that defendant did not file a return for 1970, did not mail his 1971 return until after a meeting with an IRS agent on December 26, 1972, and misrepresented both the fact of filing the 1970 return and the time of filing the 1971 return to the agent investigating his case. The evidence so construed also displays a two year pattern of derelictions in fulfilling defendant's obligation to make timely returns, itself indicative of the willfulness of his actions.

Defendant contends that any evidence respecting events after the due dates for the filing of returns for the respective years is irrelevant to the crucial question of his state of mind at the time he failed to make the required returns. We reject this contention. See United States v. O'Connor,433 F.2d 752, 754 (1st Cir. 1970), cert. denied, 401 U.S. 911, 91 S.Ct. 874, 27 L.Ed.2d 809 (1971); United States v. Litman, 246 F.2d 206 (3rd Cir.), cert. denied, 355 U.S. 869, 78 S.Ct. 118, 2 L.Ed.2d 75 (1957). We are satisfied that the evidence taken as a whole warranted a finding that the failure to file here was attended by the bad purpose of an intention to violate the law by not fulfilling defendant's obligation of timely filing of which he was well aware. The existence of willfulness is not legally negated by the excuse of pressing business arising from the investigation of defendant's employing agency, see Bernabei v. United States, 473 F.2d 1385 (6th Cir. 1973), nor does the late filing of the 1971 return preclude finding a willful violation of the statute, which makes a misdemeanor the failure to "make such return . . . at the time or times required by law . . . ." 26 U.S.C. § 7203; Sansone v. United States, 380 U.S. 343, 354, 85 S.Ct. 1004, 13 L.Ed.2d 882 (1965).

We conclude, therefore, that the evidence here was sufficient for the jury to find that defendant did not file a return in 1970 and that his failure to file returns when required by law in 1970 and 1971 was willful within the meaning of § 7203.

Errors in the Court's Instructions

Defendant alleges that the court erred in its instructions to the jury with respect to the definition of "willful" and in its statements regarding the manner in which the jury should treat the government's evidence that it had no record of a return for 1970.

On the issue of willfulness the court instructed:

The word "willful" as used in these statutes means voluntary. It means purposeful, deliberate, and intentional as distinguished from accidental, inadvertent or...