Haggert v. Hamlin

Opinion

USCA1 Opinion

June 10, 1994
                                [NOT FOR PUBLICATION]

                            UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT
                                 ___________________

No. 94-1027

JONATHAN S. HAGGERT,

                                Plaintiff, Appellant,

                                          v.

                                 BEN HAMLIN, ET AL.,

                                Defendants, Appellees.

__________________

                     APPEAL FROM THE UNITED STATES DISTRICT COURT

                              FOR THE DISTRICT OF MAINE

                     [Hon. Morton A. Brody, U.S. District Judge]
                                            ___________________

                                 ___________________

                                        Before

                                Selya, Cyr and Boudin,
                                   Circuit Judges.
                                   ______________

                                 ___________________

               Jonathan S. Haggert, on brief pro se.
               ___________________
               Jonathan B. Huntington and Eaton, Peabody, Bradford & Veague
               ______________________     _________________________________
          on brief for appellees.

__________________

                                  __________________

Per  Curiam.      Jonathan  B.  Haggert  appeals  a
                      ___________

            district  court order granting  appellees' motion for summary

            judgment.  We affirm.

                                I.  Background
                                    __________

                      Haggert sued  the appellees,  who are employees  of

            Haggert's employer, Guilford of Maine, seeking to enjoin them

            from complying with an  Internal Revenue Service (IRS) notice

            of  levy received by Guilford.  The notice of levy instructed

            Guilford to remit a  certain, non-exempt portion of Haggert's

            wages directly to the IRS to satisfy unpaid income taxes owed

            by Haggert.   After  Haggert filed suit,  Guilford apparently

            began complying with the notice of levy. 

                      Haggert filed his suit  in state court, serving the

            appellees  with  the  summons  and complaint  on  August  26,

            1993.1  The appellees removed the action to  federal district

            court on September 24,  alleging that Haggert was challenging

            the levy  procedure established in the  Internal Revenue Code

            and   that   the  court   therefore   had  federal   question

____________________

            1.  In  his  brief, Haggert  says  that  appellees failed  to
            timely answer  his complaint.   That argument  appears to  be
            based on  Haggert's belief  that he served  the complaint  on
            appellees on or  about August 9, 1993, when he unsuccessfully
            attempted  to have  them sign  a receipt  for the  complaint,
            rather than on August 26, when the summons and complaint were
            served together on appellees as required under Maine R.  Civ.
            P.  4(d).   Since Haggert  acknowledges that  appellees filed
            their answer on or  about September 8, 1993 (the  record does
            not show when the  answer was filed), we conclude  that their
            answer was timely.   See  Maine R. Civ.  P. 12(a)  (requiring
                                 ___
            defendants to serve their answer within 20 days after service
            of the summons and complaint).

                                         -2-

jurisdiction  under  28 U.S.C.    1331.    They also  filed a

            motion for summary judgment, claiming that they were required

            by law to  comply with the notice of levy  and that they were

            immune from being sued by Haggert for their compliance.  

            Haggert  filed a  motion for  remand on  the ground  that the

            appellees' notice  of removal was untimely.2   In affidavits,

            he  asserted that he  had given a  copy of the  complaint "in

            hand" to the  appellees on  August 9, well  over thirty  days

            before they filed their notice  of removal.  See 28 U.S.C.   
                                                         ___

            1446(b) ("The notice of  removal . . . shall  be filed within

            thirty  days  after the  receipt  by  the defendant,  through

            service  or otherwise,  of  a copy  of  the initial  pleading

            setting  forth the claim for relief upon which such action or

            proceeding is  based, . . .  .").  Without denying  that they

            had received  the complaint,  the appellees argued  that some

            cases held that  only proper service of process triggered the

            removal period under section 1446(b).   Because they had  not

            been served until August  26, they claimed that their  notice

            of removal on September 24 was timely.  They also argued that

            Haggert's affidavits did not clearly state that the appellees

            had received a  copy of the complaint,  but indicated instead

            that  the appellees had refused to accept a proffered copy of

            the complaint.

____________________

            2.  Haggert has  also argued  that the district  court lacked
            jurisdiction  but, for  reasons  explained below,  this issue
            does not alter the outcome and need not be resolved.

                                         -3-
                                          3

The  district court  denied  Haggert's  motion  for

            remand,  and subsequently granted  the appellees'  motion for

            summary judgment.  

                                II.  Discussion
                                     __________

                      We need not determine  whether it is proper service

            or receipt of the complaint that triggers the  removal period

            under section 1446(b), or  whether the appellees' removal was

            timely  here.   As we  explain, Haggert  stands no  chance of

            success in any  court of law.  Even if  we ordered remand, we

            are certain that the state court would promptly grant summary

            judgment for the appellees.  For that reason, remand would be

            unquestionably  futile and is not required.  Cf. Bell v. City
                                                         ___ ____    ____

            of Kellogg,  922 F.2d 1418, 1424-25 (9th  Cir. 1991) (despite
            __________

            the district court's lack of  jurisdiction over the case once

            it  had determined  that  the appellants  lacked standing  to

            pursue their federal  claims, the court of appeals found that

            the  district court had  properly resolved the  merits of the

            remaining state claim; the court was "certain" that the state

            court  would  have dismissed  the  action  due to  appellees'

            "fatal  failure" to  meet  state  statutory prerequisites  to

            suit, and so the district court's resolution of that question

            prevented "any  further waste  of valuable judicial  time and

            resources").

                      Turning  to  the  merits,  it  is  clear  that  the

            district court  properly granted  the  appellees' motion  for

-4-
                                          4

summary  judgment.  It has been long established that the IRS

            may constitutionally satisfy outstanding income taxes  by way

            of nonjudicial, administrative levy under 26 U.S.C.   6331 et

            seq.  See  United States  v. National Bank  of Commerce,  472
                  ___  _____________     __________________________

            U.S. 713, 720-21 (1985); Christensen v. United States, 733 F.
                                     ___________    _____________

            Supp.  844 (D.N.J. 1990) (citing the  cases), aff'd, 925 F.2d
                                                          _____

            416 (3d Cir.  1991) (table).   Custodians of property  levied

            upon by  the IRS must comply with the notice of levy; if they

            do not, they become "liable in [their] own person and estate"

            to  the  government for  the sum  in  question and  may incur

            further penalty as  well.  See 26 U.S.C.    6332(d)(1) & (2);
                                       ___

            National  Bank of  Commerce,  472 U.S.  at 721.   If  they do
            ___________________________

            comply,  however,  they  are   immunized  from  liability  to

            delinquent taxpayers for delivering such  taxpayers' property

            to  the  IRS.    Id.  (citing  the  statutory  language,  now
                             ___

            contained in 26 U.S.C.   6332(e), which discharges the person

            honoring  the levy "from  any obligation or  liability to the

            delinquent  taxpayer with  respect  to such  property  . .  .

            arising  from such  surrender  or payment").   Custodians  of

            property levied upon have  only two defenses:  that  they are

            not  in possession of the  property, or that  the property is

            subject  to a prior judicial attachment or execution.  Id. at
                                                                   ___

            722,  727;  see  26  U.S.C.      6332(a)  ("[A]ny  person  in
                        ___

            possession of (or obligated  with respect to) property .  . .

            upon which  a levy has been  made shall . .  . surrender such

-5-
                                          5

property . .  . to  the Secretary [of  the Treasury],  except

            such part of the property  . . . as  is, at the time of  such

            demand,  subject  to an  attachment  or  execution under  any

            judicial process.").  

                      Haggert   does  not   dispute  that   Guilford  was

            obligated  to pay  him his  wages; he  does not  dispute that

            Guilford received  an IRS notice of  levy, directing Guilford

            to remit to the IRS certain, non-exempt portions of the wages

            which  Guilford owed to Haggert;3 he does not allege that his

            wages  were  subject  to   a  prior  judicial  attachment  or

            execution.   Thus,  there is  no  question that  Guilford had

            "possession of (or [was]  obligated with respect to property)

            . . .  upon which a levy has been made,"  and was required to

            surrender  that  property to  the IRS.    See Sims  v. United
                                                      ___ ____     ______

            States, 359  U.S. 108,  110-11 (1959) ("accrued  salaries are
            ______

            property  . . . subject to levy"; state auditor, who deducted

            taxes from  state employees' salaries and  issued warrants to

            pay such salaries, was  a person "obligated with respect  to"

            those salaries under  26 U.S.C.    6332(a)).   Those are  the

            material   facts  in   this   case;   they  are   undisputed.

            Accordingly, Guilford  had no choice  but to comply  with the

            notice  of levy, its employees may not be enjoined from doing

____________________

            3.  As noted above, the appellees began remitting portions of
            Haggert's wages to the IRS after Haggert filed suit.  Haggert
            has  not alleged that the  sums remitted to  the IRS included
            exempt portions of his wages.

                                         -6-
                                          6

so or be sued by Haggert for damages for having  done so, and

            the district  court  correctly granted  summary  judgment  in

            appellees'  favor.   See Burroughs  v. Wallingford,  780 F.2d
                                 ___ _________     ___________

            502,  503 (5th  Cir.  1986) (affirming  the district  court's

            dismissal of  delinquent taxpayers' suit against employees of

            the  taxpayers' employer  who  had complied  with tax  levies

            ordering  payment of a portion of the taxpayers' wages to the

            IRS).  

                      On  appeal, Haggert  makes  certain arguments  that

            challenge  the  levy  procedure,  the income  tax  system  as

            applied to him, or the IRS's compliance with other provisions

            of  the tax code or other statutes.  Strictly speaking, those

            arguments are not relevant to the present action which  seeks

            only to prevent the appellees  from complying with the notice

            of levy despite a  statutory mandate that Guilford do  so and

            statutory immunity  from  liability to  Haggert.    Haggert's

            arguments  are  inappropriate  in  an  action  against  these
                                                                    _____

            appellees, see id. at 503 (arguments challenging the tax levy
                       ___ ___

            are  more  appropriately brought  in  an  action against  the

            government), and  so we  need not consider  his arguments  in

            order to affirm the district court's decision.  See Schiff v.
                                                            ___ ______

            Simon  & Schuster,  Inc., 780  F.2d 210,  212 (2d  Cir. 1985)
            ________________________

            ("the  fact  that  appellant  disputes the  validity  of  the

            underlying  tax   assessment  does  not   alter  [appellee's]

            obligation to honor the levy, . . . .").  

-7-
                                          7

Since the appellees seek attorneys' fees and double

            costs, however, we  note that some of Haggert's  arguments or

            close variants thereon have been rejected by the courts, most

            of them  long ago, and that others  are either based on false

            premises or misreadings of  the law or are just  plain wrong.

            In  other words,  none  has any  merit.   We  recognize  that

            Haggert raised legitimate fact  issues relating to the remand

            question.  Nonetheless, even if  we had found the  appellees'

            notice of  removal to have  been untimely, resolution  of the

            merits of this case in favor of the appellees was inevitable.

            Precedent was overwhelmingly  against Haggert's suit;  he had

            no ground for relief against these appellees, as the district

            court   explained  before   Haggert   brought   his   appeal.

            Therefore, his  appeal was frivolous  under Fed. R.  App. 38.

            See E.H. Ashley & Co. v. Wells Fargo Alarm Services, 907 F.2d
            ___ _________________    __________________________

            1274, 1280 (1st Cir. 1990).

                      Accordingly, we grant appellees' request for double

            costs.   Kelly v.  United States, 789  F.2d 94, 98  (1st Cir.
                     _____     _____________

            1986) (awarding double  costs against a  pro se taxpayer  for

            bringing a frivolous appeal);  Sullivan v. United States, 788
                                           ________    _____________

            F.2d 813, 816 (1st  Cir. 1986) (same).4  We  deny the request

            for attorneys' fees.

____________________

            4.  We  hereby deny Haggert's motion for oral argument on the
            question of sanctions.

                                         -8-
                                          8

Affirmed.  Double costs  are awarded to appellees. 
                      __________________________________________________

-9-
                                          9