Unpublished Disposition, 902 F.2d 41 (9th Cir. 1990)

No. 88-6526.

United States Court of Appeals, Ninth Circuit.

Appeal from the United States District Court for the Central District of California, Francis C. Whelan, District Judge, Presiding.

C.D. Cal.

AFFIRMED WITH SANCTIONS.

Before CANBY, LEAVY, Circuit Judges, and WILLIAM H. ORRICK,^**  District Judge.

MEMORANDUM^*** 

The Internal Revenue Service ("IRS") assessed a deficiency and penalties against Joseph and Carol Sulak after they refused to provide financial information in their 1981 income tax returns. In March 1987, after due notice, the IRS levied on Joseph Sulak's account in Sunland Federal Credit Union ("Sunland") to cover the amounts owed. The Sulaks filed this action against the IRS, its agents, Sunland, and Sunland's manager. A magistrate recommended dismissing the action for lack of jurisdiction. The district court adopted the recommendation. The Sulak's appeal. We affirm.

The Sulaks argue that they were denied due process because the magistrate and the district court failed to provide them with a hearing prior to deciding the merits of the motion to dismiss. We reject this argument. First, nothing in the record suggests the Sulaks requested a hearing. Second, we have required a hearing when " [i]t is impossible to determine from the pleadings the precise factual issues presented" and the factual posture of the case was determinative on the jurisdiction issue. Armstrong v. Udall, 435 F.2d 35, 40-41 (9th Cir. 1970) (court's jurisdiction dependent on whether appellant occupied land covered by a patent, and a hearing was necessary to hear evidence on whether she actually occupied the land). No such factual concern exists in this case. The Sulaks base their right to relief on the legal theory that, as free sovereigns, they cannot be subject to the federal income tax laws.

The magistrate adequately considered the merits of the remaining arguments advanced by the Sulaks. The district court adopted the recommendation and we affirm the decision of the district court.

Both appellees characterize this appeal as frivolous and request an award of sanctions. The IRS limits its petition to an award of $1,500 in lieu of attorney's fees and costs (an amount which the IRS represents to be less than its actual attorney's fees and costs, see IRS Appellee's Brief at 26 n. 6), while Sunland requests attorney's fees and double costs. We agree that the appeal is frivolous and note that the Sulaks have been previously sanctioned by this court for raising arguments similar to the ones advanced in this case. Pursuant to Fed. R. App. P. 38 we therefore order the Sulaks to pay $1,500 to the IRS in lieu of attorney's fees and costs and attorney's fees and double costs to Sunland. See Trohimovich v. CIR, 776 F.2d 873, 875-76 (9th Cir. 1985).

AFFIRMED WITH SANCTIONS.