Attorney-at-Law

GREENBERG’S EXPRESS – NOT THE LAST STOP

In Uncategorized on 07/13/2018 at 16:48

Maybe that hallowed 1974 classic, Greenberg’s Express, 62 T. C. 324, isn’t so dead as maybe some of us thought. When I wrote my blogpost “Play Nice at the Graev“ 7/10/18, I envisioned interrogatories, depositions, document demands, and trials, flowing from ex-Ch J L Paige (“Iron Fist”) Marvel’s expansive order therein recited.

No less an authority than the Lead of The Jersey Boys confided to me the other day that Greenberg’s Express has been derailed, that Judge Tannenwald’s famous diktat that “(A)s a general rule, this Court will not look behind a deficiency notice to examine the evidence used or the propriety of respondent’s motives or of the administrative policy or procedure involved in making his determinations,” 62 T.C. 324, at p. 327, is dead-letter law.

Formerly, only when the very fabric of the Constitution was involved would Tax Court lift the shroud that envelops the IRS’ internal machinery.

But Graev III, while broaching no new law (the statute is twenty years old this year), opened the floodgates in many cases where the Section 6751(b) Boss Hoss sign-off wasn’t even honored in the breach, much less the observance.

Who better to put Greenberg’s Express back on the tracks and cause that venerable locomotive to make the merest whistlestop at the Graev than The Great Concurrer/Dissenter, Master Silt Stirrer and Old China Hand, Judge Mark V. Holmes?

Here’s a designated hitter to send us off to the weekend despite the Friday the 13th jinx, Scott A. Householder & Debra A. Householder, et al., Docket No. 19150-10, filed 7/13/18.

Scott & Deb had their day in court, and even cross-examined IRS’ declarant who now seeks to wild-card in the Boss Hoss sign-off, but nobody mentioned Boss Hoss on the trial. Scott & Deb yell “too late and prejudice, besides it’s all hearsay.”

Now the Boss Hoss sign-off is riddled with hearsay. But IRS is crafty, and relies on our old friend res gestae. I remember Prof. Grey T., on the Hill Far Above, so long ago, proclaiming “It’s all part of the reece jest-eye.”

For those of my readers who didn’t attend a high-priced law school, the res gestae is an exclamation or document introduced into evidence for the fact that it exists or was said, not for the truth thereof. So, like John Ciardi’s apostrophe to a poem, the statement need not mean but be.

True, the IRS is extremely tardy and slow off the mark.

“But we do think the Commissioner might have had less reason to anticipate the importance of § 6751 in this case than in many other cases. Although Graev III didn’t create new law, it is true that it and Chai are the first cases to clarify that § 6751(b) and § 7491(c) combine to place the burden of production on the Commissioner to show that he complied with § 6751(b) in cases where he wants a penalty. And unlike other cases where Chai ghouls have appeared, § 6751 never came up here in pretrial motions or discovery, and the Ninth Circuit has found that reopening the record may be justified in such a case. There wasn’t a change in law here — in the strictest sense of the phrase -but we also think it is possible that Graev III‘s consequences might have surprised the Commissioner in this case where § 6751 had not been talked about at all.” Order, at p. 6. (Citations omitted).

And Scott & Deb’s beef about prejudice and the need to sweat IRS’ declarant doesn’t get it, because said declarant testified enough on the trial back in 2014 to show the Boss Hoss did sign off.

As has been said before, the mere fact that the document exists is enough. See my blogpost “Robosigner? – Part Deux,” 4/5/18. All my piety and wit, and all my tears cannot wash out a word of it, as a much finer writer than I put it.

Edited to add: I’m told the line about a poem should not mean but be is not by John Ciardi, but by Archibald MacLeish. Sorry, Archie.

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