Opinion
22590-19
06-08-2023
NEIL R. CLEMENT & MEREDITH M. CLEMENT, Petitioners v. COMMISSIONER OF INTERNAL REVENUE, Respondent
ORDER
Eunkyong Choi Special Trial Judge
Pending before the Court is petitioners' Motion to Compel Discovery Responses Pursuant to Tax Court Rule 104, filed June 29, 2022. Petitioners move the Court to compel respondent to: (1) provide answers to petitioners' First Interrogatories that are either signed under oath or are certified in accordance with 28 U.S.C. § 1746 "by an IRS person, not its lawyer, in accordance with Tax Court Rule 71(c);" (2) answer interrogatory ten of petitioners' First Interrogatories and interrogatories three, four, and five of petitioners' Second Interrogatories; (3) answer interrogatory one of petitioners' Second Interrogatories; and (4) further respond to request one of petitioners' Second Request for Production of Documents.
Unless otherwise indicated, all statutory references are to the Internal Revenue Code, Title 26 U.S.C., in effect at all relevant times, all regulation references are to the Code of Federal Regulations, Title 26 (Treas. Reg.), in effect at all relevant times, and all Rule references are to the Tax Court Rules of Practice and Procedure.
For the reasons explained below, petitioners' motion is granted in part and denied in part.
Discussion
I. Certification of Respondent's Answers to Interrogatories
Although the amount in controversy in this case is less than $50,000, because petitioners did not elect to have the proceedings in this case conducted under section 7463, the proceedings must be conducted in accordance with the Tax Court Rules of Practice and Procedure, and in accordance with the Federal Rules of Evidence. See § 7453; Rule 143(a). This Court does not apply the Federal Rules of Civil Procedure unless the Tax Court Rules of Practice and Procedure provide no governing procedure and the Federal Rules of Civil Procedure are acceptable to govern the matter at hand. Rule 1(b).
Rule 70(a)(1) allows parties to obtain discovery by written interrogatories. Interrogatories are "to be answered by the party served or, if the party served is a . . . governmental agency, by an officer or agent who shall furnish such information as is available to the party." Rule 71(a). Unless objected to, each answer must be under oath and "signed by the person making them." Rule 71(c). Each objection must be signed by the person making them or by counsel. Id. However, pursuant to 28 U.S.C. § 1746, in lieu of answering under oath, a party may, in writing, make an unsworn declaration attesting to the truth of their answers under penalty of perjury. The unsworn declaration must be in substantially the same form as that provided by the statute and must provide that the declaration is "under penalty of perjury" and is "true." See Roy v. Ivy, 53 F.4th 1338, 1348 (11th Cir. 2022).
Respondent's certifications of his answers to petitioners' interrogatories are not in substantially the same form as that provided by 28 U.S.C. § 1746 because the certifications do not purport to be true, only "complete and correct." Also, his answers do not satisfy Rule 71(a) because they were not made by an officer or agent of respondent, but by respondent's counsel. While either the party served or counsel may object to interrogatories, only the party served (not counsel) may answer interrogatories. The Court will therefore compel respondent to provide answers to petitioners' interrogatories that are made under oath, or pursuant to 28 U.S.C. § 1746, by an officer or agent of respondent.
II. Respondent's Responses to Petitioners' Discovery Requests
Parties may discover any information that is relevant and that is not privileged. Rule 70(b)(1). The Court may limit the discovery of information that is outside the scope of Rule 70(b)(1). Rule 70(c)(1)(C). Relevancy is "construed broadly to encompass any matter that bears on, or that reasonably could lead to other matter[s] that could bear on, any issue that is or may be in the case." Oppenheimer Fund, Inc., v. Sanders, 437 U.S. 340, 351 (1978).
A. Interrogatory Ten of Petitioners' First Interrogatories and Interrogatories
Three, Four, and Five of Petitioners' Second Interrogatories
Interrogatory ten of petitioners' First Interrogatories and interrogatories three through five of petitioners' Second Interrogatories all seek information relating to credit for withholding for taxable year 2016 in relation to respondent's levy of petitioner Neil Clement's retirement account. This issue came before the Court previously. On August 11, 2021, respondent filed a Motion for Partial Summary Judgment moving the Court to dismiss petitioners' claim for withholding credit for taxable year 2016. In an Order filed April 22, 2022, the Court granted respondent's motion. Accordingly, information relating to credit for withholding for taxable year 2016 is irrelevant. The Court will not compel respondent to answer these interrogatories because they seek information that is outside the scope of Rule 70(b)(1).
B. Interrogatory One of Petitioners' Second Interrogatories
Interrogatory one of petitioners' Second Interrogatories to respondent is as follows: "State the last known home address, home telephone number and mobile telephone number for Jose Lopez, identified in the IRS's responses to informal discovery." Answering this interrogatory, respondent objected on the grounds that the interrogatory "is not reasonably calculated to lead to the discovery of admissible evidence" and that the information sought, contact information for a former employee of respondent, is private. Petitioners assert that the information is discoverable because respondent has identified the former employee as a person with knowledge and facts about this case. Under Rule 70(b)(1), respondent must provide contact information for the former employee unless that information is irrelevant or privileged. However, under Rule 70(c)(1)(A), the Court may limit discovery if it determines that "the discovery sought is unreasonably cumulative or duplicative, or is obtainable from some other source that is more convenient, less burdensome, or less expensive . . . ."
Jose Lopez signed the Form 668-A(ICS) Notice of Levy that revenue agent Robin Underwood sent to petitioners notifying them that respondent had initiated a levy to collect unpaid tax liabilities totaling $798,498, which petitioners incurred over the course of 13 years. He signed the form on behalf of the then-acting area director, Jeffrey T. Daniel. Jose Lopez may have information that is relevant to this case. However, Robin Underwood, the revenue agent assigned to petitioners' file and the person who initiated the levy of the retirement account, is another source of the discovery petitioners seek from Jose Lopez and is the more convenient source because she is currently employed with Respondent. Respondent has already produced contact information for Robin Underwood. Accordingly, the Court will not compel respondent to produce contact information for Jose Lopez.
C. Request One of Petitioners' Second Request for Production of Documents
Request one of petitioners' Second Request for Production of Documents is as follows: "Produce a copy of the federal record retention schedule pursuant to which the Clément's [sic] collection file was destroyed on October 1, 2019." Responding to this request, respondent produced a copy of Document 12990, Records Control Schedule. Document 12990 provides over 20 schedules for the destruction of records. Respondent's response was unresponsive in that it did not indicate which schedule governed the destruction of petitioners' records.
Respondent subsequently discovered the National Archives form that identified the schedule pursuant to which petitioners' collection file was destroyed and produced it. Petitioners took issue with the fact that certain information in the form was redacted. However, as respondent noted, the information responsive to petitioners' request (the schedule pursuant to which petitioners' records were destroyed) was not redacted. Accordingly, respondent cured his defective response by later identifying the schedule pursuant to which petitioners' records were destroyed, making the dispute regarding respondent's response to request one of petitioners' Second Request for Production of Documents moot. The Court will not compel respondent to produce an unredacted copy of the previously produced National Archives form.
Upon due consideration of the foregoing, it is
ORDERED that petitioners' Motion to Compel Discovery, filed June 29, 2022, is granted in that respondent shall, by August 2, 2023, provide responses to petitioners' interrogatories that are made under oath, or pursuant to 28 U.S.C. § 1746, by an officer or agent of respondent. It is further
ORDERED that petitioners' Motion to Compel Discovery is denied in that respondent is not compelled to provide information relating to credit for withholding for taxable year 2016. Specifically, respondent is not compelled to answer interrogatory ten of petitioners' First Interrogatories or interrogatories three through five of petitioners' Second Interrogatories. It is further
ORDERED that petitioners' Motion to Compel Discovery is denied in that respondent is not compelled to provide contact information for former employee Jose Lopez. It is further
ORDERED that petitioners' Motion to Compel Discovery is denied in that the dispute regarding respondent's response to request one of petitioners' Second Request for production of documents is moot.