United States of America and S. Lee Rabney, Revenue Officer of The Internal Revenue Service v. Theodore M. McAnlis, 721 F.2d 334, 11th Cir. (1983)

721 F.
2d 334
84-1 USTC P 9187
UNITED STATES of America and S. Lee Rabney, Revenue

Officer
of the Internal Revenue Service, Plaintiffs-Appellees,
v.
Theodore M. McANLIS, Defendant-Appellant.
Nos. 82-5543, 82-5750.
United States Court of Appeals,

Eleventh Circuit.
Dec. 12, 1983.
Theodore M. McAnlis, pro se.

Stanley Marcus, U.S. Atty., Marc Fagelson, Asst. U.S. Atty., Miami, Fla.,
Michael L. Paup, Appellate Sect., Glenn L. Archer, Jr., Charles E.
Brookhart, Jo-Ann Horn, Tax Div., Dept. of Justice, Washington, D.C.,
for plaintiffs-appellees.
Appeals from the United States District Court for the Southern District of
Florida.
Before RONEY, HATCHETT and ANDERSON, Circuit Judges.
HATCHETT, Circuit Judge:
In this case we determine whether the district court was correct in enforcing an
Internal Revenue Service summons and holding the taxpayer in civil contempt.
We affirm.
The appellant, Theodore M. McAnlis, appeals two orders issued by the United
States District Court for the Southern District of Florida. First, McAnlis appeals
the order of April 12, 1982, enforcing an Internal Revenue Service (IRS)
summons ordering McAnlis to produce documents reflecting his income for the
years 1977, 1978, and 1979. Second, he appeals the district court's order of
April 26, 1982, finding him in civil contempt for failing to produce the
information. Finding the trial court's orders correct, we affirm.
3
On July 1, 1981, the Internal Revenue Service issued a summons to McAnlis

directing him to produce records relevant to income tax liability for the years
1977, 1978, and 1979. On March 2, 1982, the trial court ordered McAnlis, who
had consistently refused to produce the documents, to appear at the IRS offices
on March 30, 1982, and produce the requested information. The trial court also
directed McAnlis to appear in court on April 9, 1982, if he failed to present the
information on March 30. McAnlis appeared at the IRS offices on March 30,
but failed to bring the requested records. The trial court, therefore, on April 9,
enforced the summons and ordered McAnlis to appear before the IRS on April
16, 1982, and produce the information or show cause why he should not be
held in contempt. On April 22, the trial court held McAnlis in civil contempt
because he had failed to produce the required information or explain his failure
to do so on April 16.
4I. The Trial Court's Enforcement of the Internal Revenue

Service Summons
5
McAnlis raises six arguments concerning enforcement of the summons: (1) the
court abused its discretion by failing to determine that his letter to the IRS on
July 9, 1981, challenging the validity of the summons was an appearance by
him sufficient to shift the burden to the government to reject his challenge to the
summons; (2) the IRS did not have a right to summon his records, as it had no
basis on which to assume he is a person liable to pay taxes; (3) the IRS must
prove the existence of tax liability prior to issuance of any summons; (4) the
IRS did not comply with the disclosure provisions of the Privacy Act, 5
U.S.C.A. Sec. 552a(e)(3); (5) the IRS violated the fourth amendment; and (6)
the IRS did not exhaust its administrative remedies.
McAnlis's first contention lacks merit. In a petition for enforcement of a

summons, the IRS need only make a preliminary showing, "that the
investigation will be conducted pursuant to a legitimate purpose, that the
inquiry may be relevant to the purpose, that the information sought is not
already within the Commissioner's possession, and that the administrative steps
required by the Code have been followed." United States v. Powell, 379 U.S.
48, 57-58, 85 S.Ct. 248, 254-55, 13 L.Ed.2d 112 (1964). See also United States
v. LaSalle National Bank, 437 U.S. 298, 313, 98 S.Ct. 2357, 2366, 57 L.Ed.2d
221 (1978). Once the IRS fulfills this initial burden of showing a good-faith
issuance of the summons, the burden then shifts to the taxpayer to prove the
IRS failed to meet its burden or that the enforcement of the summons
constitutes an abuse of the court's process. Powell at 58, 85 S.Ct. at 255; United
States v. Southeast First National Bank of Miami Springs, 655 F.2d 661, 664
(5th Cir.1981).
7
In this case, the IRS has fulfilled its initial burden. McAnlis, however, has not
met his burden. His letter of July 9, 1981, fails to establish bad faith on the part
of IRS, or that enforcement of the summons constitutes an abuse of the court's
process. The letter contains various assertions detailing the procedural
deficiencies of the summons, but does not exhibit any evidence rebutting the
IRS's claims.
McAnlis's second and third contentions also are frivolous. The IRS had a basis
upon which to assume McAnlis was liable to pay taxes. McAnlis's failure to file
income tax returns for three years provided the basis. The IRS was complying
with its statutory duty in issuing the summons after McAnlis's failure to file his
returns. 26 U.S.C.A. Sec. 7602(a)(1), (2).1 The IRS, moreover, is not required
to establish tax liability prior to issuance of a summons. The agency has a
statutory duty to inquire after persons who may be liable for the payment of
taxes. 26 U.S.C.A. Sec. 7601(a).2 Since McAnlis failed to file any tax returns
for three years, the Internal Revenue Service legitimately believed he might be
liable for payment of taxes. Issuance of the summons prior to the establishment
of tax liability, therefore, was proper. The agency was fulfilling its statutory
duty. Donaldson v. United States, 400 U.S. 517, 523-24, 91 S.Ct. 534, 538-39,
27 L.Ed.2d 580 (1971); United States v. Harris, 628 F.2d 875, 878 (5th
Cir.1980).
McAnlis's remaining contentions lack substance. Compliance with 5 U.S.C.A.

Sec. 552a(e)(3), the Privacy Act, is not a prerequisite to enforcement of an IRS
summons. United States v. Wills, 475 F.Supp. 492, 494 (M.D.Fla.1979).
McAnlis, moreover, has suffered no prejudice in failing to receive a Privacy Act
notice. Enforcement of the summons does not violate McAnlis's fourth
amendment rights. As long as the IRS complies with the Powell requirements,
it will not violate the summoned party's fourth amendment rights. United States
v. Roundtree, 420 F.2d 845, 847-50 (5th Cir.1969). In this case, the IRS
fulfilled the Powell requirements. The IRS exhausted all administrative
remedies. Enforcement of the summons, therefore, does not violate the
exhaustion of remedies doctrine.
II. The Court's Order Holding McAnlis in Civil Contempt

10
11
McAnlis contends the trial court erred in holding him in contempt. (1) McAnlis
argues the court erred in initiating contempt proceedings on its own motion. (2)
McAnlis contends his affidavit was sufficient to purge himself of contempt. (3)
McAnlis claims the trial court denied him his right to counsel by rejecting his
request for a continuance so he could obtain counsel for the contempt
proceeding. (4) McAnlis argues that he did not have a fair opportunity to
produce a defense; and (5) McAnlis claims the contempt charge was based on
insufficient evidence. After a review of the record, we find McAnlis's
arguments meritless.
12
McAnlis suffered no prejudice as a result of the trial court's initiation of

contempt proceedings on its own motion. The trial court's action constituted
harmless error. McAnlis's affidavit was insufficient to purge him of the
contempt charge. In a contempt hearing, the alleged contemnor has the burden
of proving inability to produce the requested information. McPhaul v. United
States, 364 U.S. 372, 379, 81 S.Ct. 138, 142, 5 L.Ed.2d 136 (1960); United
States v. Hankins, 565 F.2d 1344, 1351-52 (5th Cir.), opinion clarified and
reh'g denied, 581 F.2d 431 (5th Cir.1978), cert. denied, 440 U.S. 909, 99 S.Ct.
1218, 59 L.Ed.2d 457 (1979). McAnlis's affidavit states that he has difficulty
comprehending the difference between matters of fact and conclusions of law;
but contains no evidence of his inability to produce the information. This
affidavit fails to fulfill his burden of proving inability to produce the requested
information.
13
The right to counsel exists if the litigant may lose his physical liberty if he loses
the litigation. Lassiter v. Department of Social Services of Durham County,
North Carolina, 452 U.S. 18, 25, 101 S.Ct. 2153, 2158, 68 L.Ed.2d 640 (1981).
We do not dispute McAnlis's right to counsel at the contempt proceeding
because imprisonment is a possibility. A review of the facts, however, compels
this court to hold McAnlis waived his right to counsel. On February 17, 1982,
McAnlis explained to the trial court that he did not want to pay for an attorney.
Subsequently, at the contempt hearing on April 22, McAnlis requested that the
trial court grant a continuance so he could obtain counsel. The facts suggest
that McAnlis requested the continuance to delay the proceedings.
14
The notice requirements of criminal contempt proceedings also apply to civil

contempt proceedings. Brown v. Braddick, 595 F.2d 961, 966, n. 7 (5th
Cir.1979). To have sufficient notice of a contempt hearing, an individual needs
adequate notice and time for preparation. In Re Brummit, 608 F.2d 640, 642-43
(5th Cir.1979), cert. denied, 447 U.S. 907, 100 S.Ct. 2990, 64 L.Ed.2d 856
(1980); In Re Grand Jury Proceedings, 559 F.2d 234 (5th Cir.1977), cert.
denied, 434 U.S. 1062, 98 S.Ct. 1234, 55 L.Ed.2d 762 (1978). After reviewing
the facts, we find that McAnlis had adequate notice and time for preparation of
his defense. The trial court, therefore, gave him sufficient notice of the
contempt proceedings.
15
The contempt charge was based on sufficient evidence. Once a trial court
enforces an IRS summons, an individual who does not comply with the
summons is properly held in contempt unless he produces evidence showing
his lack of possession or control of the information sought by the summons.
See United States v. Hankins at 1351-52. Since McAnlis did not comply with
the summons enforced by the district court, he was properly held in contempt
because he had not produced any evidence concerning his lack of possession or
control of the information sought by the Internal Revenue Service.
III. Conclusion
16
We affirm the trial court's orders. The trial court acted properly in enforcing the
summons and holding McAnlis in contempt.
17
AFFIRMED.
Title 26, U.S.C.A. Sec. 7602(a)(1), (2) provides in pertinent part:

(a) Authority to summon, etc.--For the purpose of ascertaining the correctness
of any return, making a return where none has been made, determining the
liability of any person for any internal revenue tax or the liability at law or in
equity of any transferee or fiduciary of any person in respect of any internal
revenue tax, or collecting any such liability, the Secretary or his delegate is
authorized-(1) To examine any books, papers, records, or other data which may be relevant
or material to such inquiry;
(2) To summon the person liable for tax or required to perform the act, or any
officer or employee of such person, or any person having possession, custody,
or care of books of account containing entries relating to the business of the
person liable for tax or required to perform the act, or any other person the
Secretary or his delegate may deem proper, to appear before the Secretary or
his delegate at a time and place named in the summons and to produce such
books, papers, records, or other data, and to give such testimony, under oath, as
may be relevant or material to such inquiry[.]
Title 26, U.S.C.A. Sec. 7601(a) provides:
(a) General rule.--The Secretary or his delegate shall, to the extent he deems it
practicable, cause officers or employees of the Treasury Department to proceed,
from time to time, through each internal revenue district and inquire after and
concerning all persons therein who may be liable to pay any internal revenue
tax, and all persons owning or having the care and management of any objects
with respect to which any tax is imposed.

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721 F.

UNITED STATES of America and S. Lee Rabney, Revenue

United States Court of Appeals,

Theodore M. McAnlis, pro se.

On July 1, 1981, the Internal Revenue Service issued a summons to McAnlis

4I. The Trial Court's Enforcement of the Internal Revenue

McAnlis's first contention lacks merit. In a petition for enforcement of a

McAnlis's remaining contentions lack substance. Compliance with 5 U.S.C.A.

II. The Court's Order Holding McAnlis in Civil Contempt

McAnlis suffered no prejudice as a result of the trial court's initiation of

The notice requirements of criminal contempt proceedings also apply to civil

Title 26, U.S.C.A. Sec. 7602(a)(1), (2) provides in pertinent part:

Title 26, U.S.C.A. Sec. 7601(a) provides:

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