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ATLANTIC MACARONI CO. v. CORWIN

May 1, 1936

ATLANTIC MACARONI CO., Inc.,
v.
CORWIN



The opinion of the court was delivered by: GALSTON

GALSTON, District Judge.

The United States Attorney moves to dismiss the complaint on the ground that it seeks recovery from the United States, through the collector of internal revenue, of certain internal revenue taxes erroneously alleged to have been assessed and collected by the defendant, and fails to allege the filing with the Commissioner of Internal Revenue of a claim for refund.

The complaint alleges that the plaintiff was engaged in the manufacture and sale of spaghetti, macaroni, noodles, and alimentary pastes; that on July 9, 1933, it had in its possession a large amount of wheat flour for the purposes of its business; that in August, 1933, the defendant, while collector of internal revenue for the First District of New York, demanded of the plaintiff the sum of $8,770.32 as a tax imposed by the Act of Congress of May 12, 1933, c. 25, title 1, § 16, 48 Stat. 31, 40 (Agricultural Adjustment Act, U.S.C. title 7, § 616 [7 U.S.C.A. § 616]). Plaintiff refused to pay this sum and defendant threatened that unless it was paid plaintiff would be treated as a delinquent and its property seized. Under the coercion of the demand, the plaintiff paid the sum demanded to the defendant.

 The plaintiff alleges that the act and the taxes imposed were and still are contrary to the Constitution of the United States. Accordingly, plaintiff demands judgment against the defendant in the sum of $8,770.32. The complaint was filed July 11, 1935.

 Since the filing of the complaint, the Supreme Court, on January 6, 1936, in United States v. William M. Butler et al., 297 U.S. 1, 56 S. Ct. 312, 80 L. Ed. , affirmed the order of the United States Circuit Court of Appeals, 78 F.2d 1, which reversed the order of the District Court, 8 F.Supp. 552. That court had rendered judgment holding the taxes imposed valid and ordering them paid.

 Accordingly, the plaintiff here contends that the act in question, having been declared unconstitutional, the procedural parts fall with the substantive parts, and cites: Trusler v. Crooks (1926) 269 U.S. 475, at page 482, 46 S. Ct. 165, 70 L. Ed. 365; Connolly v. Union Sewer Pipe Co. (1902) 184 U.S. 540, 565, 22 S. Ct. 431, 441, 46 L. Ed. 679; Ogden City v. Armstrong (1897) 168 U.S. 224, 18 S. Ct. 98, 42 L. Ed. 444; Pollock v. Farmers' Loan & Trust Co. (1895) reargument 158 U.S. 601, at page 635, 15 S. Ct. 912, 39 L. Ed. 1108; Spraigue v. Thompson (1886) 118 U.S. 90, 6 S. Ct. 988, 30 L. Ed. 115; Poindexter v. Greenhow (Virginia Coupon Cases) (1884) 114 U.S. 270, 5 S. Ct. 903, 962, 29 L. Ed. 185.

 In Trusler v. Crooks, supra, the validity of section 3 of the Future Trading Act (c. 86, 42 Stat. 187) was under consideration; previously in Hill v. Wallace, 259 U.S. 44, 42 S. Ct. 453, 66 L. Ed. 822, the major part of the plan had been condemned and it was held, therefore, that section 3, being a mere feature without separate purpose, must share the invalidity of the whole, despite the fact that section 11 of the act provided, "that if any provision of this Act * * * is held invalid, the validity of the remainder of the Act * * * shall not be affected thereby." This case does not stand for the proposition asserted by the plaintiff that the procedural provisions fall with the substantive.

 Connolly v. Union Sewer Pipe Co., supra, holds no more than the well-understood proposition that "if different sections of a statute are independent of each other, that which is unconstitutional may be disregarded, and valid sections may stand and be enforced. But if an obnoxious section is of such import that the other sections without it would cause results not contemplated or desired by the legislature, then the entire statute must be held inoperative." This was not an action to recover money from the government or any of its administrative agencies and clearly is not in point.

 Ogden City v. Armstrong, supra, likewise is of no value in the determination of the question involved here because the remedial provision in respect to claims or actions for refund was not part of the statute in question.

 Pollock v. Farmers' Loan & Trust Co., supra, Spraigue v. Thompson, and Poindexter v. Greenhow (Virginia Coupon Cases), supra, are equally unavailable to the plaintiff and for the same reasons.

 On the other hand, the government contends that the validity of the provisions of the Agricultural Adjustment Act, as amended with respect to refunds and recoveries of taxes paid thereunder, is not affected by the determination of the Supreme Court that such taxes are unconstitutional and void.

 Section 14 of the statute as originally enacted (U.S.C. title 7, § 614, 7 U.S.C.A. § 614) provides that if any provision of the title is declared unconstitutional, the validity of the remainder shall not be affected thereby.

 On August 24, 1935, a time subsequent to the filing of the complaint herein, the Agricultural Adjustment Act was amended; chapter 25, 48 Stat. 31, as amended by the Act of August 24, 1935; ...


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