A-39213, DECEMBER 17, 1931, 11 COMP. GEN. 244

A-39213: Dec 17, 1931

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TO APPEAR AND TO HAVE THE CASE REMOVED TO A FEDERAL COURT FOR PROPER DETERMINATION OF WHETHER. THE GOVERNMENT'S TRANSFER OF TITLE WAS FREE OF ANY ALLEGED OWNERSHIP IN FAVOR OF A THIRD PERSON. IS NOT ENTITLED TO REIMBURSEMENT FOR THE LOSS OF THE CAR OR ANY EXPENSES INCURRED IN CONNECTION THEREWITH. 1931: THERE IS BEFORE THIS OFFICE FOR CONSIDERATION AND SETTLEMENT YOUR CLAIM FOR $851. THE CLAIM IS MADE UP OF THE FOLLOWING ITEMS: (A) $375.00. WAS SEIZED BY FEDERAL PROHIBITION AGENT KIRSHBAUM. WHERE STORAGE WAS PAID THEREON TO AND INCLUDING APRIL 7. WAS GIVEN A BILL OF SALE FOR THE PROPERTY. THAT THE FILE IN THE CASE SHOWS THAT NOTICE WAS PUBLISHED IN THE LOS ANGELES NEWS ON FEBRUARY 21.

A-39213, DECEMBER 17, 1931, 11 COMP. GEN. 244

PROHIBITION ENFORCEMENT - SEIZURE AND SALE OF AUTOMOBILES - REPLEVIN THE PURCHASER OF AN AUTOMOBILE WHICH HAD BEEN SEIZED FOR VIOLATION OF THE INTERNAL REVENUE LAWS, AND SOLD UNDER FEDERAL STATUTES, HAVING UNDERTAKEN TO DEFEND HIS TITLE TO THE CAR IN A REPLEVIN SUIT AGAINST HIM IN A MUNICIPAL COURT, WITHOUT GIVING THE GOVERNMENT NOTICE AND AN OPPORTUNITY THROUGH ITS ATTORNEYS, TO APPEAR AND TO HAVE THE CASE REMOVED TO A FEDERAL COURT FOR PROPER DETERMINATION OF WHETHER, UNDER THE FEDERAL STATUTES, THE GOVERNMENT'S TRANSFER OF TITLE WAS FREE OF ANY ALLEGED OWNERSHIP IN FAVOR OF A THIRD PERSON, IS NOT ENTITLED TO REIMBURSEMENT FOR THE LOSS OF THE CAR OR ANY EXPENSES INCURRED IN CONNECTION THEREWITH.

COMPTROLLER GENERAL MCCARL TO LAWRENCE S. COPELAND, DECEMBER 17, 1931:

THERE IS BEFORE THIS OFFICE FOR CONSIDERATION AND SETTLEMENT YOUR CLAIM FOR $851, BASED ON THE SALE TO YOU OF PEERLESS SEDAN, MOTOR NO. 11-E-6692, SEIZED FOR VIOLATION OF THE INTERNAL REVENUE LAWS. THE CLAIM IS MADE UP OF THE FOLLOWING ITEMS:

(A) $375.00, PURCHASE PRICE OF PEERLESS SEDAN, ENGINE NO. 11-E 6692, SOLD UNDER SECTION 3460, R.S., BY THE PROHIBITION ADMINISTRATOR.;

(B) $350.00, DAMAGES AWARDED THE STERLING FINANCE CORPORATION FOR THE WITHHOLDING AND DETENTION OF SAID AUTOMOBILE;

(C) $100.00, ATTORNEY'S FEE FOR DEFENDING REPLEVIN SUIT BROUGHT BY THE STERLING FINANCE CORPORATION; AND

(D) $26.00, COURT COSTS, INCLUDED IN JUDGMENT AGAINST LAWRENCE S. COPELAND.

THE FACTS APPEAR TO BE AS FOLLOWS:

ON JANUARY 21, 1930, PEERLESS SEDAN, ENGINE NO. 11-E-6692, REGISTERED UNDER 1930 CALIFORNIA LICENSE NO. 5-P-1892, WAS SEIZED BY FEDERAL PROHIBITION AGENT KIRSHBAUM, FOR VIOLATION OF THE INTERNAL REVENUE LAWS AND PLACED IN STORAGE WITH THE LOS ANGELES WAREHOUSE CO., WHERE STORAGE WAS PAID THEREON TO AND INCLUDING APRIL 7, 1930. IT APPEARS THAT YOU PURCHASED THE CAR APRIL 5, 1930, PAYING THEREFOR THE SUM OF $375, AND WAS GIVEN A BILL OF SALE FOR THE PROPERTY, SIGNED BY WILLIAM R. WOODS, JR., FEDERAL PROHIBITION ADMINISTRATOR, FOR THE TWENTY-SECOND DISTRICT OF CALIFORNIA (LOS ANGELES), DATED APRIL 7, 1930. THE GOVERNMENT OFFICER WHO HAD CHARGE OF THIS SEIZURE AND SALE ADVISED THIS OFFICE UNDER DATE OF DECEMBER 5, 1931, THAT THE FILE IN THE CASE SHOWS THAT NOTICE WAS PUBLISHED IN THE LOS ANGELES NEWS ON FEBRUARY 21, 1930, AS FOLLOWS:

NOTICE.--- TREASURY DEPARTMENT, OFFICE OF PROHIBITION ADMINISTRATOR, 1108 TRANSPORTATION BUILDING, LOS ANGELES, CALIF., FEBRUARY 21, 1930. ALL PERSONS CLAIMING THE FOLLOWING-DESCRIBED PROPERTY, SEIZED FOR VIOLATIONS OF THE INTERNAL REVENUE LAWS OF THE UNITED STATES ARE REQUIRED TO APPEAR AND MAKE SUCH CLAIM PRIOR TO MARCH 22, 1930, IN DEFAULT OF WHICH SUCH PROPERTY WILL BE DISPOSED OF UNDER THE PROVISIONS OF SECTION 3460, REVISED STATUTES. * * * ONE PEERLESS SEDAN, ENGINE NO. 11-E-6692, SEIZED JANUARY 21, 1930, IN LOS ANGELES COUNTY, CALIF. * * * WM. R. WOODS, JR., PROHIBITION ADMINISTRATOR. X-/6684). DATE OF FIRST PUBLICATION FEBRUARY 21, 1930.

ON MARCH 26, 1930, THERE APPEARED A PUBLICATION IN THE LOS ANGELES NEWS AS FOLLOWS:

NOTICE.--- TREASURY DEPARTMENT, OFFICE OF PROHIBITION ADMINISTRATOR, 1108 TRANSPORTATION BUILDING, LOS ANGELES, CALIF., MARCH 26, 1930. NO CLAIM BEING FILED AS REQUIRED BY THE STATUTE, FOLLOWING-DESCRIBED PROPERTY WILL BE SOLD AT AUCTION AT THIS OFFICE ON APRIL 5, 1930, AT 10 O-CLOCK IN THE FORENOON, UNDER THE PROVISIONS OF SECTION 3460, REVISED STATUTES; * * * ONE PEERLESS SEDAN, ENGINE NO. 11-E-6692; * * * WM. R. WOODS, JR., ADMINISTRATOR. DATE OF FIRST PUBLICATION, MARCH 26, 1930.

THIS OFFICE HAS BEEN ADVISED, ALSO, THAT THE "SALE OF THIS CAR WAS MADE TO PUBLIC AUCTION BY SEALED BIDS, FOUR OF WHICH WERE RECEIVED; " THAT THE BIDS WERE OPENED APRIL 5, 1930; AND THAT THE CAR WAS SOLD TO THE HIGHEST BIDDER, LAWRENCE S. COPELAND.

ON APRIL 24, 1930, THE PROCEEDS OF THE SALE, $375, WERE DEPOSITED WITH THE TREASURER OF THE UNITED STATES, BY THE COLLECTOR OF INTERNAL REVENUE, SIXTH DISTRICT OF CALIFORNIA, SYMBOL NO. 14390, ON CERTIFICATE OF DEPOSIT NO. 594, THE AMOUNT HAVING BEEN COVERED BY WARRANT NO. 7110, DATED MAY 6, 1930, TO THE CREDIT OF "0100--- INTERNAL REVENUE.'

IT APPEARS THAT THE STERLING FINANCE CORPORATION (ADDRESS NOT SHOWN), FILED A REPLEVIN SUIT AGAINST YOU IN THE MUNICIPAL COURT OF THE CITY OF LONG BEACH, LOS ANGELES COUNTY, CALIF., ON JUNE 5, 1930, AND THAT JUDGMENT WAS RENDERED AGAINST YOU BY THE COURT ON OCTOBER 14, 1930, IT HAVING BEEN DETERMINED THAT WILLIAM R. WOODS, JR., IN HIS CAPACITY AS FEDERAL PROHIBITION ADMINISTRATOR, OR OTHERWISE, FAILED TO COMPLY WITH THE LAWS AND REGULATIONS OF THE UNITED STATES IN THE SALE OF THE AUTOMOBILE UNDER SECTION 3460, REVISED STATUTES.

IT APPEARS, ALSO, THAT THE COURT ORDERED, ADJUDGED AND DECREED THAT THE PLAINTIFF HAVE AND RECOVER FROM THE DEFENDANT, LAWRENCE S. COPELAND, THE IMMEDIATE POSSESSION OF SAID AUTOMOBILE OR $500, PLUS $350 DAMAGES FOR DETENTION OF THE PROPERTY BY THE DEFENDANT, ALSO COST OF SUIT, TAXED AT $26. NO APPEAL WAS TAKEN. THE CAR WAS DELIVERED AT ONCE, AND RECEIPT TAKEN THEREFOR.

YOU HAVE SUBMITTED RECEIPTS FOR THE PURCHASE PRICE OF $375 PAID BY YOU TO THE GOVERNMENT FOR THE CAR (IN VIEW OF ITS RETURN), AND $100 ATTORNEY FEES, BUT NO RECEIPTS ARE SUBMITTED FOR THE ITEMS, $350 DAMAGES, OR $26 COSTS, IN THE REPLEVIN SUIT.

THE REVENUE ACT OF MAY 29, 1928, 45 STAT. 882, PROVIDES:

SEC. 709. THE PROVISIONS OF LAW APPLICABLE TO THE REMISSION OR MITIGATION BY THE SECRETARY OF THE TREASURY OF FORFEITURES UNDER THE CUSTOMS LAWS SHALL APPLY TO FORFEITURES INCURRED OR ALLEGED TO HAVE BEEN INCURRED, BEFORE OR AFTER THE ENACTMENT OF THIS ACT, UNDER THE INTERNAL- REVENUE LAWS.

THE APPLICABLE PROVISIONS OF THE TARIFF ACT OF 1922, 42 STAT. 986, PROVIDE:

SEC. 613. DISPOSITION OF PROCEEDS.--- ANY PERSON CLAIMING ANY VESSEL, VEHICLE, MERCHANDISE, OR BAGGAGE, OR ANY INTEREST THEREIN, WHICH HAS BEEN FORFEITED AND SOLD UNDER THE PROVISIONS OF THIS ACT, MAY AT ANY TIME WITHIN THREE MONTHS AFTER THE DATE OF SALE APPLY TO THE SECRETARY OF THE TREASURY IF THE FORFEITURE AND SALE WAS UNDER THE CUSTOMS LAWS, * * * FOR A REMISSION OF THE FORFEITURE AND RESTORATION OF THE PROCEEDS OF SUCH SALE, OR SUCH PART THEREOF AS MAY BE CLAIMED BY HIM. UPON THE PRODUCTION OF SATISFACTORY PROOF THAT THE APPLICANT DID NOT KNOW OF THE SEIZURE PRIOR TO THE DECLARATION OR CONDEMNATION OF FORFEITURE, AND WAS IN SUCH CIRCUMSTANCES AS PREVENTED HIM FROM KNOWING OF THE SAME, AND THAT SUCH FORFEITURE WAS INCURRED WITHOUT ANY WILFULL NEGLIGENCE OR INTENTION TO DEFRAUD ON THE PART OF THE APPLICANT, THE SECRETARY OF THE TREASURY * * * MAY ORDER THE PROCEEDS OF THE SALE, OR ANY PART THEREOF, RESTORED TO THE APPLICANT, AFTER DEDUCTING THE COST OF SEIZURE AND OF SALE, THE DUTIES, IF ANY, ACCRUING ON THE MERCHANDISE OR BAGGAGE, AND ANY SUM DUE ON A LIEN FOR FREIGHT, CHARGES, OR CONTRIBUTION IN GENERAL AVERAGE THAT MAY HAVE BEEN FILED. IF NO APPLICATION FOR SUCH REMISSION OR RESTORATION IS MADE WITHIN THREE MONTHS * * *, THE PROCEEDS OF SALE SHALL BE DISPOSED OF AS FOLLOWS:

THERE IS NO RECORD THAT THE STERLING FINANCE CORPORATION PRESENTED TO THE GOVERNMENT AT ANY TIME BETWEEN FEBRUARY 21, 1930, DATE OF FIRST PUBLICATION OF NOTICE, AND APRIL 5, 1930, DATE OF SALE, ANY CLAIM OF TITLE TO OR INTEREST IN THE SAID SEDAN, OR THAT SAID CORPORATION EVER MADE CLAIM TO THE SECRETARY OF THE TREASURY FOR REMISSION OF THE FORFEITURE AND RESTORATION OF THE CAR OR PAYMENT TO IT OF THE PROCEEDS OF THE SALE MADE TO YOU ON APRIL 5, 1930.

SINCE YOU UNDERTOOK TO DEFEND YOUR TITLE TO THE CAR AND PERMITTED THE MUNICIPAL COURT OF LONG BEACH TO CONSIDER AND PASS UPON THE LEGALITY OF THE GOVERNMENT'S SALE TO YOU WITHOUT GIVING THE GOVERNMENT NOTICE AND AN OPPORTUNITY THROUGH ITS ATTORNEYS, TO APPEAR AND HAVE THE CASE REMOVED TO A FEDERAL COURT FOR PROPER DETERMINATION OF WHETHER UNDER THE FEDERAL STATUTES, THE GOVERNMENT'S TRANSFER OF TITLE TO YOU WAS FREE OF ANY ALLEGED OWNERSHIP IN FAVOR OF THE STERLING FINANCE CORPORATION, I HAVE NO CHOICE BUT TO DISALLOW YOUR CLAIM. SEE DECISION OF THIS OFFICE, DATED SEPTEMBER 11, 1931, A-38319. SEE, ALSO, MOFFAT AND ANOTHER V. UNITED STATES, 112 U.S. 24, WHEREIN IT WAS HELD THAT THE GOVERNMENT DOES NOT GUARANTEE THE INTEGRITY OF ITS OFFICERS, NOR THE VALIDITY OF THE ACTS OF SUCH.