United States v. Trout, 1375
| Decision Date | 19 February 1942 |
| Docket Number | 1674,1733,1870.,No. 1375,1375 |
| Citation | 46 F. Supp. 484 |
| Court | U.S. District Court — Southern District of California |
| Parties | UNITED STATES v. TROUT et al. |
Latham & Watkins and R. W. Lund, all of Los Angeles, Cal., for W. A. Trout and others.
Meserve, Mumper & Hughes, of Los Angeles, Cal., for New York Life Ins. Co.
William Fleet Palmer, U. S. Atty., and Eugene Harpole, Sp. Atty., Bureau of Internal Revenue, both of Los Angeles, Cal., for the United States.
The above entitled actions have been duly consolidated and have been so tried. Instead of setting forth a lengthy statement of the facts and the reasons for my conclusions, I believe that the facts are thoroughly understood by all the parties and that, due to the large amount of money tied up in the hands of the United States District Clerk, an expeditious disposition of the case will be preferred by all parties, hence I shall content myself by stating my conclusions.
I find that the defendant W. A. Trout had no right, title or interest in and to the first endowment policy. I further find that the same had been duly assigned to Doris M. Grunigen and Forest J. Grunigen and that they are entitled to the proceeds of said policy, less costs and attorneys' fees hereinafter provided. The Government's evidence merely raised a suspicion of juggling.
Relative to the second endowment policy, I find the defendant W. A. Trout had an interest therein at the time of the perfection of the Government's lien and that the Government is entitled to 9,874.82/53,774.16 of the sum of $48,017.00, less costs and attorneys' fees as hereinafter provided. There is no evidence justifying the conclusion that the payment of $3,038.00 made by check of Mrs. Trout entitles her to an interest in the proceeds of this policy. I hold it was a voluntary payment on her part. In fact, her attempt to claim such an interest demonstrates, in my mind, the length some people will go in avoiding their obligations to their government.
The three life policies are admittedly the property of the debtor taxpayer and the Government is entitled to a judgment directing the interest of W. A. Trout thereby sold and the proceeds applied to the tax claims of the Government. I am not impressed with the contention of counsel that the "insured taxpayer has no interest in these three policies which is subject to seizure for payment of his tax liability", because the same has no cash surrender value, only a borrowing privilege. To so...
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