Unpublished Disposition, 883 F.2d 1025 (9th Cir. 1989)

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US Court of Appeals for the Ninth Circuit - 883 F.2d 1025 (9th Cir. 1989)

Michael Earl WARREN; Gretchen Ann Warren, Petitioners-Appellants,v.COMMISSIONER INTERNAL REVENUE SERVICE, Respondent-Appellee.

No. 88-7130.

United States Court of Appeals, Ninth Circuit.

Submitted June 28, 1989.* Decided Aug. 17, 1989.

Before BARNES, WALLACE and SKOPIL, Circuit Judges.


Michael and Gretchen Warren (the Warrens) appeal pro se the tax court's entry of summary judgment in favor of the Commissioner for deficiencies caused by the Warrens' failure to file 1983 income tax returns. They also appeal the tax court's award of section 6673 damages to the Commissioner. The Warrens contend that notices of deficiency were erroneously issued to them and that the tax court lacked jurisdiction. The Commissioner defends the decision below and requests sanctions on appeal. The tax court had jurisdiction under 26 U.S.C. §§ 7442 and 6214(a). We have jurisdiction over this timely appeal pursuant to 26 U.S.C. § 7482(a). We affirm. We also sanction the Warrens $1,500 and impose double costs for this frivolous appeal. Fed. R. App. P. 38.

We review decisions of the tax court on the same basis as decisions entered in the district court after civil bench trials. Professional & Executive Leasing, Inc. v. Commissioner, 862 F.2d 751, 753 (9th Cir. 1988). We review a summary judgment independently. Fireguard Sprinkler Systems, Inc. v. Scottsdale Insurance Co., 864 F.2d 648, 649 (9th Cir. 1988). In reviewing a summary judgment, we view the evidence in the light most favorable to the nonmoving party and consider whether there are any genuine issues of material fact and whether the court below correctly applied the relevant law. Little v. City of Seattle, 863 F.2d 681, 683 (9th Cir. 1988). Pro se papers are to be liberally construed. Christensen v. Commissioner, 786 F.2d 1382, 1384 (9th Cir. 1986).

The Warrens first contend that the tax court erred in granting summary judgment to the Commissioner. This contention lacks merit. In their petition for redetermination, the Warrens argued that the Commissioner and IRS: (1) failed to prepare an assessment of their taxes; (2) failed to assist them in resolving the amount they owed; (3) erred in applying a "married filing separately" status to the deficiency determination since the Warrens had always filed jointly; and (4) violated the Internal Revenue Code (IRC) and civil service codes by failing to assist them.

The Warrens' first and third allegations fail because they point to the Warrens' own failure to file a return and not to any wrongful act of the Commissioner. The IRS has no nondiscretionary duty to assess a taxpayer's taxes on demand. Stang v. IRS, 788 F.2d 564, 565 (9th Cir. 1986). The Warrens were required to file income tax returns for 1983. 26 U.S.C. §§ 6011(a) and 6012(a) (1) (A). By failing to file a return and by filing a petition in the tax court, the Warrens precluded the preparation of an assessment. See 26 U.S.C. §§ 6201(a) (1) and 6213(a). In addition, by not submitting a return, the Warrens failed to instruct the IRS as to their preferred filing status, which must be elected annually. Thompson v. Commissioner, 78 T.C. 558, 561 (1982); see also 26 U.S.C. § 6013(a); Counts v. Commissioner, 774 F.2d 426, 428 (11th Cir. 1985).

As for the Warrens' second claim, the record indicates that they were indeed assisted by the IRS, which sent them filing instructions and 1040 forms. However, the Warrens chose not to file a return. The Warrens' fourth claim--that the IRS violated the IRC and civil service code--is vague, conclusory and unintelligible. Since the Warrens have identified no justiciable error, see Grimes v. Commissioner, 806 F.2d 1451, 1453 (9th Cir. 1986) (Grimes), the Commissioner's determinations are presumed correct. Rapp v. Commissioner, 774 F.2d 932, 935-36 (9th Cir. 1985).

The Warrens also contend that the tax court lacked jurisdiction. However, the tax court is constitutional and has jurisdiction to determine the amount of a deficiency. Redhouse v. Commissioner, 728 F.2d 1249, 1253 & n. 2 (9th Cir.), cert. denied, 469 U.S. 1034 (1984). The tax court had jurisdiction over the Warrens once a valid notice of deficiency had been issued and the Warrens had petitioned the tax court for a redetermination. 26 U.S.C. §§ 6212, 6213; Tax Court Rule 13(a); cf. Abrams v. Commissioner, 814 F.2d 1356, 1357 (9th Cir. 1987) (failure of IRS to provide deficiency notice removes tax court jurisdiction).

The Warrens also raise various meritless arguments for the first time on appeal: (1) they are not liable for taxes or deficiencies because the IRC does not specify a tax on income earned within the United States by citizens; (2) as citizens, they would commit perjury by signing a return since the IRC specifies a tax on earned income only if earned by resident aliens or foreign corporations; (3) the IRC does not require them to file a return; (4) the IRC does not give the IRS jurisdiction over their person and property; (5) the federal taxation system is unconstitutional; (6) the IRC imposes tax on income not on individuals; (7) the tax penalties are invalid; and (8) taxes are voluntary. We need not address these issues because they were not raised in the tax court. Commissioner v. McCoy, 108 S. Ct. 217, 218-19 (1987).

The Warrens next appear to contend that the tax court erred in imposing damages under 26 U.S.C. § 6673. We review section 6673 damages for abuse of discretion. Grimes, 806 F.2d at 1454. We conclude that there was no abuse of discretion here. The Warrens did not raise any issue of fact to dispute the propriety of the Commissioner's determinations under Tax Court Rule 121, and they failed to state clear and concise assignments of error allegedly committed by the Commissioner under Tax Court Rule 34(b). Where the petition states claims which are unsubstantiated, vague, or utterly meritless, it is certainly no abuse of discretion to impose damages. 26 U.S.C. § 6673; Grimes, 806 F.2d at 1453-54 (damages awarded where no justiciable error presented in petition).

Finally, the Commissioner requests an award of $1,500 damages on the ground that this appeal is frivolous. We have discretion to impose attorneys' fees and single or double costs as a sanction for bringing a frivolous appeal. Fed. R. App. P. 38; McCarthy v. Mayo, 827 F.2d 1310, 1318 (9th Cir. 1987). An appeal is frivolous if the result is obvious or the arguments are wholly without merit. Swimmer v. IRS, 811 F.2d 1343, 1345 (9th Cir. 1987).

As explained above, the Warrens' arguments are unsubstantiated and frivolous. We therefore grant the Commissioner's request for sanctions in the amount of $1,500, see Cook v. Spillman, 806 F.2d 948, 949 (9th Cir. 1986) (imposing flat sanction of $1,500 against pro se litigant who raised frivolous arguments), as well as for double costs. Fed. R. App. P. 38.


Note: This disposition is not appropriate for publication and may not be cited to or by the Courts of this Circuit except as provided by Ninth Circuit Rule 36-3.


The panel is unanimously of the opinion that oral argument is not required in this case. Fed. R. App. P. 34(a)