Local 174, International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America and Nugent La Poma v. United States

This is a proceeding to obtain discovery as to certain transactions between Local 174 and one Frank Brewster, which are claimed to be pertinent to an examination into the liability of Brewster and his wife for income tax during the years 1943 to 1953, inclusive. Since results obtained by administrative subpoena were unsatisfactory, this case was initiated in the District Court.

Frank Brewster has been for many years an employee and officer of Local 174, having acted as secretary-treasurer from 1947 through 1953 and subsequently as president. During the years 1943 to 1947, Brewster filed separate income tax returns. In 1948 he was married to Dorothy Brewster, and in the years 1948 through 1952 husband and wife filed joint income tax returns.

In January, 1954, a special agent of the Bureau of Internal Revenue was assigned to au,dit all such returns. A summons was issued by him to the Local and Nugent La Poma pursuant to § 7602 of the Internal Revenue Code of 1954, 26 U.S.C.A. § 7602 , directing them to bring all records and books of account of the Local “which in any way refer or relate to transactions between the said Local 174 and Frank W. Brewster, Dorothy Brewster or any other…

(dissenting).

I dissent. In my view the majority opinion indicates a misapprehension of the nature and character of this proceeding and it arrives at a conclusion which disregards all of the recent decisions both of the Supreme Court and of this court upon this subject. In United States v. Morton Salt Co., 338 U.S. 632, 642 , 70 S.Ct. 357, 363 , 94 L.Ed. 401 , the Supreme Court frankly recognized that it had turned a corner in dealing with cases of this kind and that in adjudging of the propriety of a court order enforcing an administrative subpoena, many of the old concepts had fallen by the wayside. The Court said:

“The only power that is involved here is the power to get information from those who best can give.it and who are most interested in not doing so. Because judicial power is reluctant if not unable to summon evidence until it is shown to be relevant to issues in litigation, it does not follow that an administrative agency charged with seeing that the laws are enforced may not have and exercise powers of original inquiry. It has a power of inquisition, if one chooses to call it that, which is not derived from the judicial function. It is more analogous to the Grand…

240 F.2d 387 56-2 USTC P 10,056 LOCAL 174, INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS OF AMERICA and Nugent La Poma, Appellants, v. UNITED STATES of America, Appellee. No. 14746. United States Court of Appeals Ninth Circuit. Nov. 8, 1956. Bassett, Geisness & Vance, Samuel B. Bassett, Seattle, Wash., for appellants. Charles P. Moriarty, U.S. Atty., William A. Helsell, Asst. U.S. Atty., Seattle, Wash., for appellee. Before HEALY, POPE and JAMES ALGER FEE, Circuit Judges. JAMES ALGER FEE, Circuit Judge. 1 This is a proceeding to obtain discovery as to certain transactions between Local 174 and one Frank Brewster, which are claimed to be pertinent to an examination into the liability of Brewster and his wife for income tax during the years 1943 to 1953, inclusive. Since results obtained by administrative subpoena were unsatisfactory, this case was initiated in the District Court. 2 Frank Brewster has been for many years an employee and officer of Local 174, having acted as secretary-treasurer from 1947 through 1953 and subsequently as president. During the years 1943 to 1947, Brewster filed separate income tax returns. In 1948 he was married to…