United States v. Williams, 514 U.S. 527 (1995)

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certiorari to the united states court of appeals for the ninth circuit

No. 94-395. Argued February 22, 1995—Decided April 25, 1995

The Government assessed a tax against Jerrold Rabin and placed a lien on all of his property, including his interest in the home he jointly owned with respondent Lori Williams, his then-wife. Before the Government recorded its lien, Rabin transferred his interest in the home to Williams, as part of a division of assets in contemplation of divorce. Although Williams was not personally liable for the tax, she paid it under protest to remove the lien and sued for a refund under 28 U. S. C. 1346(a)(1), which waives the Government's sovereign immunity from suit in "[a]ny civil action . . . for the recovery of any internal-revenue tax alleged to have been erroneously or illegally assessed or collected." The Government responded that it was irrelevant whether the Government had a right to Williams' money because she lacked standing to seek a refund under 1346(a)(1). According to the Government, that provision authorizes refund actions only by the assessed party, i. e., Rabin. The District Court accepted this jurisdictional argument, but the Court of Appeals reversed.

Held: Section 1346(a)(1) authorizes a refund suit by a party who, though not assessed a tax, paid the tax under protest to remove a federal tax lien from her property. Pp. 531-541. (a) Williams' plea falls squarely within 1346(a)(1)'s broad and unequivocal language authorizing suit for "any . . . tax . . . erroneously . . . collected." Pp. 531-532. (b) The Government's strained reliance on the interaction of three other provisions to narrow 1346(a)(1)'s waiver of sovereign immunity is rejected. The Government argues: Under 26 U. S. C. 7422, a party may not bring a refund action without first exhausting administrative remedies; under 26 U. S. C. 6511, only a "taxpayer" may exhaust; under 26 U. S. C. 7701(a)(14), Williams is not a taxpayer. The Government's argument fails at two statutory junctures. First, the word "taxpayer" in 6511(a)—the provision governing administrative claims—cannot bear the weight the Government puts on it. This provision's plain terms provide only a deadline for filing for administrative relief, not a limit on who may file. Further, the Government's claim that Williams is not at this point a "taxpayer" is unpersuasive. In placing a lien on her home and then accepting the tax payment she made under protest,


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