to raise the first defense, by denying that he currently has outstanding loan obligations to Yelram in the amount of $ 15,568 and to MMP in the amount of $ 280,408. (Def. Memorandum in Opposition to Pl. Motion for Summary Jdgmt, p. 1.)
The only support Williams offers for this position is his sworn affidavit stating that he is not currently indebted to Yelram or MMP, that "no tax returns subsequent to the 1991 returns of Yelram Productions, Inc. . . . make any reference to any outstanding loan obligations to either Yelram Productions Inc. or Marley Marl Productions . . ." and that both of the 1994 433-B forms relied upon by the Government "were prepared and presented to me by an accountant without any explanation as to their contents, and I signed the same without any understanding of their contents. These documents were not signed before any notary or other public official; nor was I ever sworn under oath to the veracity of the contents of these forms." (Williams Aff. P 3.)
We agree with the Government that this evidence is insufficient as a matter of law. As regards the $ 15,568 loan to Yelram, it is difficult to determine from Yelram's 1991 consolidated tax forms precisely what monies Williams owed Yelram and its subsidiaries as of the end of 1991. We note that the consolidated balance sheet shows a net loan "to stockholders" (and Williams was the sole stockholder of Yelram and all of its subsidiaries) of $ 99,661. (See Exh A., Form 1120, Schedule L.) Relying upon Williams' statements to the IRS in 1994, these loan amounts apparently subsequently changed. Regardless, Williams in 1994 declared under the penalty of perjury that Yelram's sole asset was a $ 15,568 loan to himself
(See July 30, 1996 Declaration of Daniel S. Alter, Exh. E.) Similarly, he declared under the penalty that one of MMP's seven assets was a $ 280,408 loan to himself. Id. at Exh. F. Although he failed, apparently inadvertently, to include this amount on the next page under "Accounts/Notes Receivable," he cannot escape the compelling effect of his explicit declaration that he owed the precise amount of $ 280,408.
These declarations are binding upon Williams. We are entitled to give an unsworn statement signed under the penalty of perjury the same weight as an affidavit. Goldman, Antonetti, Ferraiuoli, Axtmayer & Hertell v. Medfit Intern., 982 F.2d 686, 690 (1st Cir. 1993), (citing 28 U.S.C. § 1746
); Bleavins v. U.S., 807 F. Supp. 487, 489 (C.D.Ill.), aff'd, 998 F.2d 1016 (7th Cir. 1983). Williams cannot now contradict this statement with a later affidavit. "The rule is well settled in this circuit that a party may not, in order to defeat a summary judgment motion, create a material issue of fact by submitting an affidavit disputing his own prior sworn testimony." Trans-Orient Marine Corp. v. Star Trading & Marine, Inc., 925 F.2d 566, 572 (2d Cir. 1991); see also Reisner v. General Motors Corp., 671 F.2d 91, 93 (2d Cir.), (disregarding plaintiff's factual claims after defendant moved for summary judgment, "where those claims contradicted statements made previously by plaintiff at his deposition, in his affidavits, and in response to defendant's interrogatories"), cert. denied, 459 U.S. 858, 74 L. Ed. 2d 112, 103 S. Ct. 130 (1982); cf. United States v. Wynshaw, 697 F.2d 85, 87 (2d Cir.) (taxpayer estopped from claiming signature on return was not hers when she represented at a later date that it was, thus causing the IRS to rely to their detriment on her representation), cert. denied, 464 U.S. 822, 78 L. Ed. 2d 96, 104 S. Ct. 87 (1983).
Nor can he avoid his sworn 1994 statement merely by claiming in his affidavit that an accountant prepared the forms and he did not understand them. "An account is merely the agent of the taxpayer," Springfield Prod., Inc. v. C.I.R., T.C. Memo 1979-023, 1979 T.C. Memo 23, 1979 WL 3121, 38 T.C.M. (CCH) 74, T.C.M. (P-H) 79,023 (U.S. Tax Ct., Jan 16, 1979) (No. 6412-69, 7252-72) (citations omitted), and it is "a common agency principle that the principal . . . is responsible for the action of his agent (accountant)." Id. In addition, the law assumes that a taxpayer will read his return before signing it. Cf. In re Meier, 1993 U.S. Dist. LEXIS 10792, 1993 WL 406055, 72 A.F.T.R.2d (P-H) 5598, 93-2 U.S. Tax Cas. (CCH) 50,482 (E.D.Va., July 26, 1993) (No. 2:93 Civ. 583), (citing Erdahl v. C.I.R., 930 F.2d 585, 589 (8th Cir. 1991) (discussing the "innocent spouse" exception)). The 433-B Form Williams signed in 1994 regarding Yelram was neither long nor complex -- it consisted of a mere four pages in which the sole asset, the $ 15,568 loan, was listed twice. One of these instances listed the $ 15,568 as a "Account/Note Receivable" and denominated it "Marlon Williams". (See July 30, 1996 Declaration of Daniel S. Alter, Exh. E.) The Yelram Form 433-B only contained one other number. Id. Similarly, the MMP Form 433-B consisted of four pages and a mere seven listed assets, one a $ 280,408 denominated "Marlon Williams." Id. at Exh. F. Williams cannot now claim that he did not understand this form.
Lastly, although he states that subsequent tax records do not reflect any outstanding loan obligations to him, he has not provided those records. Moreover, absent evidence regarding the satisfaction of the loan that he stated under the penalty of perjury existed in 1994, such a mere offering of later self-serving tax forms would be insufficient evidence to defeat the Government's motion for summary judgment.
For the foregoing reasons, we grant the Government's motion for summary judgment. We find that Williams is subject to the Notices of Levy dated February 3, 1995 and order him to pay the United States the amount he owed Yelram ( $ 15,568) and MMP ( $ 280,408), together with costs and interest as set forth in 26 U.S.C. § 6332, not to exceed the amount Yelram and MMP currently owe the IRS.
April 9, 1997
White Plains, NY
William C. Conner
Senior United States District Judge