Williams v. United States, 1671.

• Decision Date: 02 May 1941
• Docket Number: No. 1671.,1671.
• Citation: 38 F. Supp. 536
• Parties: WILLIAMS v. UNITED STATES.
• Court: U.S. District Court — Northern District of Illinois

38 F. Supp. 536

WILLIAMS v. UNITED STATES.

No. 1671.

District Court, N. D. Illinois, E. D.

May 2, 1941.

Charles O. Rundall and Horace A. Young, both of Chicago, Ill., and Samuel T. Ansell and I. B. Kirkland, Jr., both of Washington, D. C., for plaintiff.

J. Albert Woll, U. S. Dist. Atty., of Chicago, Ill., and Carl J. Marold, Asst. U. S. Atty. Gen., of Washington, D. C., for defendant.

WOODWARD, District Judge.

The Court finds the facts herein as follows:

1. Plaintiff, Griff Williams, is 32 years of age and a resident of the City of Chicago, County of Cook and State of Illinois; and defendant, United States of America, is a corporation sovereign and body politic.

2. This action arises under the Internal Revenue Laws of the United States and is a suit for the recovery of $536.04 social security taxes assessed against and collected from the plaintiff for the year 1938, under Section 804, Title VIII of the Social Security Act of 1935, as amended, 42 U.S. C.A. § 1004.

3. On or about April 28, 1938, the plaintiff filed an Employer's Tax Return required under Title VIII of the Social Security Act for the first quarter of the year 1938 with the Collector of Internal Revenue in Chicago. This return reflected a tax of $187.16 imposed upon employers and employees by Title VIII of the Social Security Act of 1935, which amount the plaintiff paid to the Collector on that date. One-half thereof, viz., $93.58, represented the employer's tax imposed by Section 804 of said Act. No returns were filed by the plaintiff for the remaining three quarters of the year 1938. In May, 1939, under authority of Section 3612(a) of the Internal Revenue Code, 26 U.S.C.A. the Collector of Internal Revenue at Nashville, Tennessee, prepared and filed in the name of the plaintiff the Employer's Tax Returns for the remaining three quarters of the year 1938. These returns reflected a tax for this period arising under Title VIII of the Social Security Act which together with penalties and interest amounted to $884.92. This amount was assessed by the Commissioner of Internal Revenue and was paid by the plaintiff to the Collector of Internal Revenue at Chicago on February 3, 1940. One-half of said sum, viz., $442.46, represented the employer's tax imposed by Section 804 of said Act. On the same day the plaintiff filed with the Collector of Internal Revenue at Chicago a claim for refund of $536.04, representing such employer's taxes, penalties and interest, so paid, together with interest thereon. This claim for refund was rejected by the Commissioner of Internal Revenue by registered letter dated April 15, 1940, whereupon this suit was commenced.

4. Plaintiff is, and has been since 1930, a member of San Francisco Local No. 6 of the American Federation of Musicians (hereinafter referred to as the "Federation"), a labor union affiliated with the American Federation of Labor.

5. While an undergraduate at Stanford University, plaintiff assembled a campus orchestra, fulfilling engagements for compensation in an effort to earn funds with which to continue his college education. Plaintiff interrupted his university career to fill an engagement as a piano player with an orchestra led by Anson Weeks at the Mark Hopkins Hotel in San Francisco, California. That engagement lasted about thirteen months, after which plaintiff returned to the University and obtained his degree. After being graduated in 1932, plaintiff was re-engaged to play as a pianist under the leadership of Anson Weeks, which association continued about two and a half months. Thereafter plaintiff assembled an orchestra of ten musicians, including himself, to perform music at the Edgewater Beach Cafe at San Francisco, California, which engagement continued for about nine months. Upon the termination of that engagement, plaintiff, with one Jimmy Walsh, in the year 1934, assembled an orchestra to perform music at the Mark Hopkins Hotel in San Francisco, California, which organization was known as "Jimmy Walsh and Griff Williams and Their Orchestra." That engagement lasted ten or eleven months, at which time Mr. Walsh withdrew and the orchestra became known as "Griff Williams and his Hotel Mark Hopkins Orchestra." Since 1935, plaintiff and the orchestra of which plaintiff was the leader, has been known and booked as "Griff Williams and His Orchestra."

Plaintiff has been earning his livelihood as a pianist ever since he became a member of the Federation. During the year 1938 he was the leader of a dance orchestra known as "Griff Williams and His Orchestra." During said year the orchestra of which plaintiff was the leader, which consisted of from twelve to fourteen men, played at various places, ranging from the Western Coast of the United States to as far East as Chicago, Illinois. The places at which the orchestra played were twenty-two in number, consisting of hotels, restaurants, night clubs, ballrooms, amusement parks, clubs, colleges and civic organizations.

The performances given by this orchestra consisted of playing popular music. Besides acting as leader, the plaintiff participated as a musician in the orchestra. As leader, plaintiff fixed the time for rehearsals other than rehearsals for floor shows or other talent.

All engagements for one week or longer were known as "steady engagements," and those for less than one week were known as "single engagements."

6. All engagements during the year 1938, excepting one, were performed pursuant to written contracts, of which the following are typical:¹

The exception hereinabove referred to was in the form of a letter, but not materially different from the contracts for steady engagements, being Plaintiff's Exhibit Number 16.

7. The Music Corporation of America is a booking agency duly licensed by the American Federation of Musicians. In 1934, plaintiff entered into an agreement with the Music Corporation of America making said corporation his agent for the purpose of booking engagements for his and the orchestra of which he was the leader. All of the engagements of the plaintiff and of the orchestra of which plaintiff was the leader during the year 1938 were booked by the Music Corporation of America. The consideration received by the Music Corporation of America for said bookings was in the form of commissions.

8. The laws, rules and regulations of the Federation became and were a part of the several contracts covering the engagements of plaintiff and the orchestra of which plaintiff was the leader during the year 1938, which laws, rules and regulations have been offered and admitted in evidence and are identified as Plaintiff's Exhibits Numbers 23 and 24, which, by reference, are severally and respectively incorporated herein and made a part of this finding of fact.

9. The Constitution of the Federation is identified as Plaintiff's Exhibits Numbers 23 and 24, which, by reference, are severally and respectively incorporated herein and made a part of this finding of fact.

10. The procedure through which the orchestra of which the plaintiff was the leader was booked, was as follows: The Music Corporation of America presented to the prospective establishment a number of orchestras and advised it as to the standing and qualifications of each of the prospective orchestras. In addition to receiving these recommendations, the representative of the establishment customarily made inquiries of the manager of other establishments where the plaintiff and the orchestra of which the plaintiff was the leader had played, listened to their music on the radio, and if he found the style of the music adaptable to his particular establishment, and the contract price suitable, he engaged the orchestra. In general — and there may be occasional exceptions — the establishments, in negotiating or making the contracts for the engagements, were not concerned with the identity of the individual musicians in the orchestra, and did not ask, and were not told, their names. The establishments were familiar with plaintiff and the orchestra of which plaintiff was the leader, its reputation and its special quality of music, and they relied on plaintiff to bring an organization composed of musicians selected and rehearsed by him and capable of performing its special quality of music.

11. Plaintiff himself, or by his agent, collected in a lump sum from the establishments engaging plaintiff and the orchestra of which plaintiff was the leader, the compensation of plaintiff and the members of the orchestra of which plaintiff was the leader to which they are entitled under the several contracts. Upon receiving such compensation from said establishments, the plaintiff distributed and paid to the members of the orchestra, who were known as "sidemen", the compensation due to them respectively.

12. The compensation paid by the establishments varied with and was sometimes more, but never less, than the minimum Federation scale of wages for leaders and "sidemen" as fixed for the local union jurisdiction in which the establishment was located. Plaintiff and the "sidemen" received compensation only for their services actually rendered pursuant to the terms of contracts with establishments and none for the periods between engagements. The "sidemen" received the compensation agreed upon between the plaintiff and the "sidemen", within the limits of the Federation rules. The agreements between plaintiff and the "sidemen" were oral. The establishment did not fix the compensation of the individual "sidemen." This was in accordance with the established custom of the trade. Out of the amount received by plaintiff from the several establishments, the plaintiff paid the traveling expenses of the orchestra, commissions and other miscellaneous expenses, as well as the compensation of the "sidemen", and the residue, if any, which in no event was less than the minimum scale for leaders, belonged to the plaintiff.

13. Plaintiff selected the "sidemen" and passed on the qualifications...