Opinion
No. C 02-5091 CRB
August 29, 2003
MEMORANDUM AND ORDER
Plaintiff sues an Internal Revenue Service revenue officer to quiet title on a tax lien. Now before the Court are the government's motion to remove Ava Pointer and substitute itself as a defendant, plaintiffs motion for summary judgment, and the government's motion for summary judgment. After carefully considering the papers submitted by the parties, including plaintiffs supplemental opposition filed on August 22, 2003, and having had the benefit of oral argument, the government's motion to substitute parties is GRANTED, the plaintiffs motion for summary judgment is DENIED, and the government's motion for summary judgment is GRANTED.
BACKGROUND
Plaintiff Michael John Ennis ("Mr. Ennis") filed federal income tax returns for 1994, 1995, and 1996. Kingston Decl. Ex. 1. He did not, however, fully pay the liabilities reflected on those returns. Id. The Internal Revenue Service ("IRS") claims that as of January 16, 2003, Mr. Ennis owed the United States $36,221.31, with interest continuing to accrue. Kingston Decl. Ex. 6; Def.'s Mot. at 4.
In 1997, defendant Ava Pointer ("Ms. Pointer"), then known as Ava Mills, held the position of Chief of Support Services with the IRS and was a Revenue Officer with a GS-11 ranking. Pointer Decl. at ¶ 3. On November 24, 1997, she signed and filed with the Contra Costa County Recorder's Office a Notice of Federal Tax Lien ("NFTL") to secure the IRS' interest against Mr. Ennis' property. Pointer Decl. Ex. A.
Mr. Ennis sues Ms. Pointer, challenging the validity of the NFTL. He seeks to quiet title and to recover monetary damages associated with his loss of credit rating. He makes the following allegations:
1. Ms. Pointer did not have the necessary authority to sign and file the NFTL. Compl. at 2.
2. He did not receive notices of liability or demands for payment prior to the filing of the NFTL. Compl. at 2.
3. The government did not follow the necessary state law filing procedures with respect to the NFTL. Compl. at 2.
On January 21, 2003, Mr. Ennis filed a motion attempting to amend his complaint to add the IRS as a defendant, to establish the complaint as one to "quiet title," and to ask for damages of $100,000 for "irreparable financial injury and hardships" arising from the clouding of his title.
Mr. Ennis has filed a motion for summary judgment. The government has filed a motion seeking to dismiss Ms. Pointer from the action and substitute itself as the proper defendant and a motion for summary judgment on the merits.
DISCUSSION
I. Cause of Action
As a precursor to any adjudication of the dispute, the Court must discern the proper legal bases for Mr. Ennis' claims. Pro se pleadings are held to less stringent standards than those drafted by lawyers.See Christiensen v. Commissioner of IRS, 786 F.2d 1382, 1384-85 (9th Cir. 1986). The Court should therefore construe his claims liberally in order to assure that he is not prejudiced by any lack of knowledge regarding legal technicalities. See id.
A. Quiet Title
Both sides agree that Mr. Ennis has a cause of action under 28 U.S.C. § 2410. Section 2410 allows suit against the United States to quiet title to property on which the IRS is asserted to have a procedurally invalid lien. See 28 U.S.C. § 241O(a); Elias v. Connett. 908 F.2d 521, 527 (9th Cir. 1990) (recognizing the cause of action); see also Hughes v. United States. 953 F.2d 53l, 538 (9th Cir. 1991) (noting that section 2410(a) "waives sovereign immunity and vests the district court with jurisdiction to consider matters falling within the scope of the statute") (citation omitted).
B. Damage Claims
Mr. Ennis' damage claims are barred as a matter of law.
The only causes of action that would entitle him to monetary damages are 26 U.S.C. § 7432, allowing suit for failure to release an unenforceable lien, and 26 U.S.C. § 7433, allowing suit for any other willful or negligent violation of the Internal Revenue Code. See 26 U.S.C. § 7433(a) (listing these statutes as the sole causes of action for damages arising from violations of the Internal Revenue Code); id at § 7432. Both statutes require exhaustion of administrative remedies, and both bar suits commencing more than two years after the right of action is created. See 26 U.S.C. § 7432(d), 7433(d).
There is no evidence that Mr. Ennis sought any administrative remedy here. Moreover, the NFTL was filed in 1997, and Mr. Ennis did not bring suit until 2002, which is more than twice the applicable time period.
II. Substitution of Parties
The government seeks to dismiss Ms. Pointer and substitute itself as the defendant, on the grounds that it is the real party at interest.
Both parties agree that the government should be added as a defendant. Mr. Ennis asked for this in his amended complaint, and the government has requested it in this motion. As previously noted, this Court has jurisdiction over the government in a section 2410 suit.
Mr. Ennis contests the dismissal of Ms. Pointer, apparently on the grounds that she is somehow liable in her individual capacity. See Pl,'s Mot. at 7. He argues that there is no evidence that she acted within the scope of her official duties in signing the NFTL.
This argument fails for numerous reasons. First, the government has supplied a certification pursuant to 28 U.S.C. § 2679(d) (Federal Tort Claims Act) establishing that Ms. Pointer was acting in her official capacity. Second, the burden of proof to establish that she acted in her individual capacity rests with Mr. Ennis, and he offers nothing to support even a reasonable inference that she was acting outside her official duties. Third, Mr. Ennis' only cause of action, section 2410, simply provides that "the United States may be named as a party" in suits to quiet title; it does not expressly create liability for IRS officers in either their individual or official capacity. See 28 U.S.C. § 2410. Finally, the lien belongs to the United States, not to Ms. Pointer individually, and it is unclear that she possesses the authority to release it.
Mr. Ennis has no cognizable claim against Ms. Pointer. Her dismissal is therefore appropriate.
III. Summary Judgment Motions
The Court now turns its consideration to the parties' cross-motions for summary judgment. As previously discussed, the only issue properly before this Court is the procedural validity of the lien under section 2410. The motions identify three areas of contention that have bearing on this issue: (1) whether Ms. Pointer had no authority to sign and file the NFTL, (2) whether notices of assessment and demands for payment were made, and (3) whether California's filing procedures were followed.
A. Legal Standard
"Summary judgment is appropriate when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law." Brassica Prot. Prods, v. Sunrise Farms. 301 F.3d 1343, 1347 (Fed. Cir. 2003). An issue is "genuine" only if there is sufficient evidence for a reasonable fact finder to find for the non-moving party. See Anderson v. Liberty Lobby. Inc., 477 U.S. 242, 248-49 (1986). A fact is "material" if the fact may affect the outcome of the case. See id. at 248.
The party moving for summary judgment bears the initial burden of identifying those portions of the pleadings, discovery, and affidavits that demonstrate the absence of a genuine issue of material fact. See Celotex Corp. v. Cattrett. 477 U.S. 317.323 (1986V Where the moving party will have the burden of proof on an issue at trial, it must affirmatively demonstrate that no reasonable trier of fact could find other than for the moving party. See id. Once the moving party meets this initial burden, the non-moving party must go beyond the pleadings and by its own evidence "set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). All reasonable inferences must be made in favor of the non-moving party. Anderson. 477 U.S. at 250.
B. Ms. Pointer's Authority
Both parties agree that Delegation Order 196 from the Internal Revenue Manual confers the power to sign NFTLs upon revenue officers of grade GS-9 or higher. See Delegation Order 196 at ¶¶ 1-4. Mr. Ennis argues that this is insufficient evidence of Ms. Pointer's authority because (a) the Delegation Order does not apply to Ms. Pointer since she was "Chief of Support Services," and (b) the Delegation Order only gives authority to sign the NFTL, not to file it-in this case, the filing was done by an IRS clerk at the direction of Ms. Pointer.
As to the first argument, while Ms. Pointer lists her title in 1997 as "Chief of Support Services," she also states that she was a revenue officer with a GS-11 ranking. See Defs.' Mot. Ex. 6 at 2 (Declaration of Ava Pointer). Lacking any evidence to refute this, Mr. Ennis raises no genuine issue of material fact as to Ms. Pointer's position or grade.
As to the second argument, the government admits that neither Delegation Order 196 nor any other Delegation Order specifically confers authority to file an NFTL. See Defs.' Mot at 7. However, it contends that this authority is implied by the authority to sign NFTLs and to release satisfied and unenforceable liens.
The government's position is the only one that makes sense. Ms. Pointer declares that she followed her standard procedure with regards to the filing by giving the NFTL to an IRS clerk. See Defs.' Mot. Ex. 6 at 2. In the absence of any Delegation Order specifically conferring the filing authority to anyone else, it makes sense to presume that the authority to sign an NFTL implies authority to oversee its filing.
C. Demands for Payment
Mr. Ennis asserts that the IRS did not make the proper statutory notices of assessment and demands for payment, and thus the NFTL is procedurally defective. Failure to send notices of assessment and demands for payment as required by 26 U.S.C. § 63O3(a) is a cognizable procedural defect under section 2410, and thus this Court has jurisdiction to address it. See Huff v. United States, 10 F.3d 1440, 1445 (9th Cir. 1993).
Mr. Ennis fails to raise any genuine issue of material fact here. The government has provided the Court with Forms 4340 for the years 1993-96. See Kingston Decl., Exs. 1-4. These forms show that the required notices and demands were made. Mr. Ennis presents no evidence, nor does he even allege, that the forms are in any way incorrect. Forms 4340 constitute sufficient evidence to support a grant of summary judgment against a plaintiff who alleges a violation of section 63O3(a). See Huff. 10 F.3d at 1446.
D. California Filing Procedures
Mr. Ennis asserts that California Code of Civil Procedure § 2102 requires certification of an NFTL before it can be filed.
Even if Mr. Ennis' interpretation of the regulation were correct, state procedural regulations are inapplicable to the validity of an NFTL. "The form and content [of an NFTL] shall be prescribed by the Secretary [of the Treasury]. Such notice shall be valid not withstanding any other provision of law regarding the form or content of a federal tax lien." 26U.S.C. § 6323(f)(3).
E. Summary
The Court finds that Mr. Ennis has raised no genuine issue of material fact that would entitle him to relief under 28 U.S.C. § 2410.
CONCLUSION
For the foregoing reasons, the government's motion to dismiss Ms. Pointer and substitute itself as the defendant is GRANTED, Mr. Ennis' motion for summary judgment is DENIED, and the government's motion for summary judgment is GRANTED.IT IS SO ORDERED.
JUDGMENT
The Court having dismissed the individual defendant and granted the government's motion for summary judgment by Memorandum and Order dated August 29, 2003, it is hereby ordered that judgment be entered in favor the Internal Revenue Service and against plaintiff.IT IS SO ORDERED.