Opinion
Case No. 1:01-CV-305
February 27, 2003
MEMORANDUM ORDER
The United States has brought this action to reduce federal income tax assessments against Randall and Elsha Miedema (the "Taxpayers") to judgment. The United States seeks to foreclose its federal tax liens upon property or rights to property, including property located at 6351 Division Street, Newaygo, Michigan (the "Subject Property"), to sell it, and apply the sale proceeds toward the tax debts owned by the Taxpayers pursuant to I.R.C. § 7403. The Taxpayers' co-defendants, Edward and Loraine Miedema, contend that the Subject Property belongs to them and have demanded a jury trial. The Court ordered Judgment by Default against the Taxpayers on October 25, 2002. Pursuant to the Court's November 26, 2002, Memorandum Order, the Judgment by Default against the Taxpayers was without prejudice to Edward and Lorraine Miedema's rights, defenses, and arguments in this case. Before the Court is the United States' uncontested motion to strike Edward and Lorraine Miedema' jury demand. The Court will grant the United States' motion.
The Seventh Amendment to the United States Constitution guarantees a litigant the right to jury trial for certain legal claims, but not equitable claims. U.S. Const. amend. VII; see also Tull v. United States, 481 U.S. 412, 417, 107 S.Ct. 1831, 1835 (1987); Ross v. Bernhard, 396 U.S. 531, 537-38, 90 S.Ct. 733, 737-38 (1970); Farmers-Peoples Bank v. United States, 477 F.2d 752, 755-56 (6th Cir. 1973). While actions to obtain a judgment of taxes owing are legal in nature, actions to foreclose tax liens on property are equitable in nature. See, e.g., United States v. McMullin, 948 F.2d 1188, 1190 (10th Cir. 1991) ("[W]hen the government only seeks to enforce its tax lien against a taxpayer's property, the taxpayer has no right to a jury trial since the action sounds in equity," but
where the government seeks to reduce a tax assessment to judgment and obtain a personal money judgment against the taxpayer, the taxpayer then has a Seventh Amendment right to a jury trial."); Damsky v. Zavatt, 289 F.2d 46, 56 (2d Cir. 1961) (finding that actions pursuant to I.R.C. § 7403 to foreclose a tax lien on property is an action in equity); United States v. Hassell, No. CIV.A. 302CV0112G, 2002 WL 1359718, at *1 (N.D.Tex. June 18, 2002) ("[T]here is no right to a jury trial in an action to foreclose tax liens pursuant to § 7403."). Thus, as long as an action to foreclose a tax lien on property pursuant to I.R.C. § 7403 is not commingled with other questions sounding in law, the Seventh Amendment does not guarantee a right to a jury trial.
In the instant case, the United States has already obtained a monetary judgment against the Taxpayers for the assessed federal income taxes. The only issue that remains before the Court is whether the federal tax liens attach to the Subject Property such that the United States may foreclose its liens and sell the Subject Property pursuant to I.R.C. § 7403. Additionally, the United States states in its motion to strike that it only "intends to use two alternative equitable theories to foreclose the tax liens." (Mot. Br. Strike Jury Demand at 6.) The Court thus finds that the lone remaining issue in this case sounds in equity. Accordingly, since the Seventh Amendment does not provide Edward and Lorraine Miedema a right to a jury trial, and Edward and Lorraine Miedema have not contested the United States' motion to strike their jury demand, the Court will grant the United States' motion.
Therefore,
IT IS HEREBY ORDERED that the United States' uncontested motion to strike Edward and Lorraine Miedema's jury demand (Docket No. 41) is GRANTED.