Max Kuney, Jr., and Constance K. Kuney, His Wife Max J. Kuney, Sr., Olive R. Kuney v. William E. Frank, District Director of Internal Revenue

In these three cases we are again in the never-never land of family partnerships and the income tax. Each case is an action to recover taxes claimed to have been illegally collected, following denial of claims for refund. The cases were consolidated for trial and are also consolidated on appeal. A jury returned a verdict in favor of the appellant taxpayers. Thereafter, pursuant to Rules 50(b) and 59, F.R.Civ.P., 28 U.S.C.A., a motion was made by appellee, District Director of Internal Revenue, for a judgment notwithstanding the verdict and, in the alternative, for a new trial. The court granted and entered judgment notwithstanding the verdict, and denied the motion for a new trial. All plaintiffs appeal.

The sole question is whether there was substantial evidence to sustain the verdict. The trial court held that there was not, and we agree.

The jury was instructed to return a special verdict, and did so, in the following form:

In granting judgment n. o. v., the Court said:

It is upon this ground that we are affirming.

We are often astonished at the apparent naiveté of taxpayers, and, sometimes, of their counsel. The courts have said, almost ad nauseam, and in various ways,…