Ralston v. Heiner

SCHOONMAKER, District Judge.

This This, is a suit in equity wherein the plaintiff seeks to restrain the defendant as collector of internal revenue from executing a distress warrant for the collection of taxes due the United States from A. Guckenheimer & Bros. Co., distillers, against the distillery property which the plaintiff had acquired at sheriff’s sale on an execution against said A. Guckenheimer & Bros. Co.

The defendant has moved to dismiss the bill of complaint for tbe reason that this court is without jurisdiction of this action and that the plaintiff has an adequate remedy at law.

The plaintiff does not question the validity of the tax nor the fact that it was a lien on the distillery property prior to the date of the sheriff’s sale, but bases his claim to equitable relief on tbe contention that the lien of tbe tax upon-the distillery property was divested by the sheriff’s sale on a judgment against A. Guekenheimer & Bros. Co., and therefore we have presented a ease where the collector is seeking by distress warrant to seize property of a person other than the taxable on wbieb the government has no lien or claim and a case in which, if the plaintiff pays the tax, he will have no remedy at' law under the federal statutes to sue and recover the money paid, if, as a-matter of law, the tax lien had been divested by tbe sheriff’s sale in question.

The defendant contends that the court is without jurisdiction of this action under section 3224 of the Revised Statutes (26 USCA § 154 [Comp. St. § 5947]), and that the plaintiff has a complete remedy at law under sections 3220, 3226, and 3228 of the Revised Statutes (26 USCA §§ 149, 156, 157 [Comp. St. §§ 5944, 5949, 5951]). Section 3224 pro*495vides: “no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court.”

The plaintiff says that this statute does not apply to his case because no tax was assessed against him, and that he has the right to resort to equity for relief under the authority of Long v. Rasmussen (D. C.) 281 F. 236, holding that section 3224 of the Revised Statutes applies to taxpayers only. If this be the law, it does not apply to the facts of the instant ease. True, no tax was assessed against the plaintiff but he acquired property subject to a tax lien. The distillery, the operation of which gave rise to the tax in question, came into his hands. So far as that property is concerned he takes the place of the taxpayer, and if the tax in question he illegal or its lien divested by the sheriff’s sale, he has a full and complete remedy at law by paying the tax and bringing suit to recover the money. It is not for to determine in the instant case whether the tax lien of the government was or was not divested by the sheriff’s sale, 'although we may say that ordinarily in Pennsylvania a tax lien is not divested by the sheriff’s sale except to the extent that the tax is paid out of the proceeds of the sale. It is sufficient that we hold that the court is without jurisdiction in equity of the instant case and that the plaintiff has an adequate remedy at law.

A decree for the dismissal of the plaintiff’s bill of complaint may be submitted.