Robert G. Dudley v. United States

This is an appeal from a judgment of the District Court denying appellant’s claim for refund of tax in the amount of $3734.24 collected from him by the Internal Revenue Service pursuant to 26 *1198 U.S.C. § 6672 1 and granting the United States’ counterclaim in the amount of $9258.37 representing the difference between the amount of tax assessed against appellant and the amount collected. The District Court’s opinion is reported at 285 F.Supp. 979 (N.D.Cal.1967).

In 1960, appellant was president and, along with his wife, principal stockholder of the Dudley Industrial Corporation, a manufacturer of ceramic bathroom fixtures with plants in Hollister and Hemet, California. The corporation failed to collect and pay over to the IRS employment and withholding taxes in the amount of $12,992.61 for the first two quarters of 1960, as required by Sections 3102 and 3402 of the Internal Revenue Code of 1954, 26 U.S.C. §§ 3102 , 3402. The corporation was experiencing financial difficulties at the time. An involuntary petition in bankruptcy was filed against it on or about September 15, 1960, and it was adjudicated a bankrupt on November 27, 1961. The IRS filed a claim in bankruptcy for the…

(dissenting) :

I respectfully dissent. The able and experienced trial judge had an opportunity to see and hear the witnesses, including the appellant. The judge made a specific finding that the corporation’s check in payment of the taxes was dishonored due to insufficient funds and that appellant did not have a prior agreement with the bank to pay overdrafts. This finding, in my judgment, is supported by substantial evidence.

Moreover, in my opinion, there is substantial evidence supporting the finding that appellant was a responsible officer of the corporation at the time of the issuance of the check, its presentment for payment and thereafter during the period in question. True enough, there is a conflict in the testimony as to appellant’s status. But the weight to be given testimony depends upon the credibility of the witnesses. The judge’s findings on willfulness are shored by solid evidence. In these circumstances, I would not overturn the findings of the lower court.

I would affirm.

428 F.2d 1196 70-2 USTC P 9520 Robert G. DUDLEY, Appellant, v. UNITED STATES of America, Appellee. No. 22926. United States Court of Appeals, Ninth Circuit. July 7, 1970, Rehearing Denied Aug. 12, 1970. Francis Heisler (argued), Heisler & Stewart, Carmel, Cal., for appellant. Stephen H. Hutzelman (argued), Johhnie Walters, Tax Division, Mitchell Rogovin, Lee A. Jackson, Elmer J. Kelsey, Dept. of Justice, Washington, D.C., James R. Browning, Jr., U.S. Atty., Barbara Ashley Phillips, Asst. U.S. Atty., San Francisco, Cal., for appellee. Before MADDEN, * Judge of the United States Court of Claims, KILKENNY and TRASK, Circuit Judges. TRASK, Circuit Judge: 1 This is an appeal from a judgment of the District Court denying appellant's claim for refund of tax in the amount of $3734.24 collected from him by the Internal Revenue Service pursuant to 26 U.S.C. 6672 1 and granting the United States' counterclaim in the amount of $9258.37 representing the difference between the amount of tax assessed against appellant and the amount collected. The District Court's opinion is reported at 285 F.Supp. 979 (N.D.Cal.1967). 2 In 1960, appellant was president and, along with his wife, principal…