Tuesday, July 27, 2010

What is the Foregone Conclusion To Overcome the Fifth Amendment Act of Production Doctrine? (7/27/10)

The IRS summons is a substantial tool in the investigation of tax liabilities and of crimes related to taxes. The summons is compulsory process; to that extent, is like a grand jury subpoena. It is not as powerful a tool as the grand jury subpoena (because, in part, of timing and procedural predicates in enforcing the summons not present for grand jury subpoenas), but in its compulsoriness is like a grand jury subpoena. The Supreme Court held in a line of cases culminating United States v. Hubbell, 530 U.S. 27 (2000) that, although there is no Fifth Amendment privilege for the contents of documents, compulsory process may implicate the Fifth Amendment where the witness's act of producing is inherently testimonial. It is testimonial where the existence of the documents is not a "foregone conclusion" and thus the witness would, in effect, "testify" under compulsion as to the existence of the documents, their authenticity and the witness's possession of the documents. The question is what facts rise to the level of "foregone conclusion" as to the existence and possession of the documents the IRS has summonsed (or, in the case of a grand jury subpoena, that the grand jury has subpoenaed)?

In a recent opinion in a summons enforcement case, United States v. Shadley 2010 U.S. Dist. LEXIS 81651 (ND CA 2010), the Court held that the witness need not produce checkbook deposit slips for a bank account that the IRS knew about and even already had obtained the bank's records. Thus, the IRS certainly knew of the existence of a bank account, that the witness had made deposits into the account, and that the bank would have given the defendant a stamped deposit slip in normal course of accepting the deposits reflected on the deposit slips. Yet the Court held that the witness had a Fifth Amendment privilege because the act of production was testimonial and the Government had not shown that existence and possession of the deposit slips that the witness surely received was a foregone conclusion.

If Shadley is correctly decided, it is hard to imagine a case where the taxpayer cannot assert the privilege, thus turning the act of production doctrine into a Fifth Amendment privilege for the contents of the documents. So, let's explore a bit more about what level of knowledge is required for the Government to have sufficient knowledge for the foregone conclusion that precludes the assertion of the Fifth Amendment.

In United States v. Norwood, 420 F.3d 888 (8th Cir. 2005). the IRS had instituted a much heralded initiative to discover foreign bank accounts by issuing John Doe summonses to credit card processing agencies within the United States who would have records of processed charges for foreign bank accounts. From those records, the IRS obtained evidence that a particular taxpayer, the taxpayer- defendant in this summons enforcement proceeding had a foreign credit card, The IRS issued the summons for the taxpayer's bank and credit card records and related documents. The taxpayer appeared pursuant to the summons and asserted privileges. The Government then brought the summons enforcement proceeding and requested that the Court also issue an order requiring compliance with a consent directive directing the offshore bank to disclose information to the IRS. In the affidavit in support of the summons, the IRS Agent recounted the following evidence : (i) the taxpayer had a foreign bank account with two associated credit cards; (ii) the bank account number for that account; and (iii) the taxpayer had answered no to the foreign bank account question on Schedule B of his 1040.

One of the taxpayer’s defenses to compliance was the Hubbell defense. The district court and the court of appeals rejected the defense on the basis that the information the IRS already had made the existence of the foreign bank account virtually a “foregone conclusion,” sufficient to meet Hubbell’s requirements. The court of appeals reasoned:
The existence of the requested records relating to Norwood's [foreign bank credit] cards and [related foreign bank] account is a foregone conclusion. The summons seeks records such as account applications, periodic account statements, and charge receipts, all of which are possessed by the owners of financial accounts as a matter of course. Norwood does not contend that he does not possess any of these documents, and the government knows far more about the documents associated with Norwood's [foreign bank] cards and account than it did about the defendant's business records in Hubbell. 530 U.S. at 44. In Hubbell, the government could not show "any prior knowledge of either the existence or whereabouts” of the documents sought. Id. (emphasis added). Here, by contrast, the government knows the name and location of the bank that created the records sought, Norwood's payment card numbers, and even the details of a number of discrete transactions involving the cards and his [foreign bank] account. Accordingly, the district court's conclusion that “Norwood's production of the records has no testimonial significance,” is not clearly erroneous.
United States v. Ponds, 454 F.3d 313 (D.C. Cir. 2006) addressed some of the issues left open by Hubbell in holding that the Fifth Amendment was implicated in a compelled document production. Focusing on the spectrum usually encountered between the frames of the two cases – Fisher where the documents were reasonably known to exist (no Fifth Amendment privilege) and Hubble where the Government was just fishing (Fifth Amendment privilege) – the court said (pp. 320-321):

Although the Supreme Court did not adopt the “reasonable particularity” standard in affirming our decision, it emphasized that the applicability of the Fifth Amendment turns on the level of the government's prior knowledge of the existence and location of the produced documents. See Hubbell, 530 U.S. at 44-45. Post-Hubbell, another circuit has applied the reasonable particularity standard to determine whether an act of production is sufficiently testimonial to implicate the Fifth Amendment. See In re Grand Jury Subpoena Dated April 18, 2003, 383 F.3d 905, 910 (9th Cir. 2004). Because that standard conceptualizes the Supreme Court's focus in a useful way, so do we.
The Ponds court found that, under the facts, the prosecutors did not have the required particularity of knowledge as to some of the documents and, accordingly, that Ponds had a Fifth Amendment right to not produce the documents. As is sometimes the case where the subpoenaed party properly asserts a Fifth Amendment privilege, the prosecutors in Ponds obtained an immunity order and, as in Hubbell, the immunity order is ultimately what propelled the issue forward when the taxpayer claimed, in effect, that, because his Fifth Amendment privilege was implicated, the prosecutors used the “testimony” thus compelled in a way not permitted by the grant of immunity.

Now, back to Shadley, the question as to an, if not the, appropriate standard -- the reasonable particularity standard -- appears close to the standard for search warrants. Thus, if you framed the question as to whether the Government had sufficient evidence to seek and sustain a search warrant for the deposit slips, then there would be no Fifth Amendment privilege. It seems to me that the combination of the Norwood analysis and Ponds suggests that Shadley was improperly decided.

Nevertheless, Shadley does suggest in this genre of context that it is not a foregone conclusion that a district court will enforce the summons so a taxpayer with documents too risky to disclose voluntarily would be well advised to assert the act of production doctrine and put the IRS to its proof in an enforcement proceeding.  There should be no downside to doing so, and the taxpayer may prevail.

18 comments:

  1. Jack,

    I would suggest that the Hubbell/Ponds analysis indicates that Shadley was correctly decided. The IRS did not have concrete evidence that the summonee had deposit slips or a check book. This is because there was not a competent fact witness (besides the summonee) who could testify that any such records exist or were in the summonee's possession. Accordingly, the inescapable conclusion is that the IRS was unable to establish the existence or summonee's custody of such documents as a "foregone conclusion".

    As for Norwood, I believe that the taxpayers in that case were, to put it very delicately, less than energetically defended. Hence, the result in that case.

    Further, I agree that where is a case of taxpayer with documents too risky to voluntarily disclose to the IRS, the taxpayer should put the IRS to its proof in a full-course adversarial proceeding. If a taxpayer's attorney is not up for this challenge, he or she should be replaced at once.

    Finally, if the taxpayer is compelled to produce any documents, the taxpayer's counsel should make a very careful record of the precise testimonial production that is being compelled, the potentially incriminating nature of such production, and exhaust all available appeals including resort to petitioning the Supreme Court for discretionary review. Anything less than making sure that caution abounds risks that a subsequent judge could construe the taxpayer's testimonial production as a waiver of the 5th amendment right and/or that any compelled testimony could conceivably be deemed to be "not related" to subsequent criminal charges, thus, potentially depriving the taxpayer of a full-course Kastigar hearing if the taxpayer is subsequently prosecuted.

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  2. Anonymous,

    Your comments are excellent. Thank you!

    Jack Townsend

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  3. Jack,

    Thank you for the compliment.

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  4. Jack,

    I have additional comments.

    First, I would like your readers to consider the article entitled "THE ACT-OF-PRODUCTION PRIVILEGE POST-HUBBELL: UNITED STATES V. PONDS AND THE RELEVANCE OF THE "REASONABLE PARTICULARITY" AND "FOREGONE CONCLUSION" DOCTRINES" authored by Mark A. Cowen (Link: http://www.georgemasonlawreview.org/doc/17-3_Cowen.pdf). This article was recently published in George Mason Law Review (Vol. 17. No. 3 Spring 2010, beginning at P. 863).

    Mr. Cowen argues that "the result in Ponds is correct but not for the reasons expressed in the D.C. Circuit's Opinion. By misunderstanding the holding of Hubbell, the Ponds court focused too much on the prior knowledge of the government and too little on the actual testimonial character of the production itself. " Id. at 864.

    I do not wish to steal Mr. Cowen's thunder. And so, I would like to commend his article to your readers. Perhaps you can provide an addendum at the bottom of your most recent "foregone conclusion" article.

    Secondly, I would like to commend well-respect white collar defense attorney Scott Michel's article entitled "D.C. Circuit Extends Supreme Court's Interpretation of 'Derivative Use' Under 'Act of Production' Immunity" (Link: http://www.capdale.com/files/Publication/637c06fc-a7da-4c4a-b394-01802ef1b795/Presentation/PublicationAttachment/c18fe760-4897-404c-89eb-016224f19b89/SDM%20-%20DC%20Circuit.pdf) to your readers.

    3. Finally, I would suggest that your readers check out the article entitled "THE FIFTH AMENDMENT AND THE GRAND JURY" authored by Sara Sun Beale and James Felman (Link: http://scholarship.law.duke.edu/cgi/viewcontent.cgi?article=2556&context=faculty_scholarship).

    I would especially like to draw your readers attention to page 3 of the foregoing article wherein the authors suggest: "[i]t may be necessary...for the witness to submit the documents in question to the court for in camera review. Citing United States v. Bell, 217 F.R.D. 335 (M.D. Pa. 2003); United States v. Cianciulli, 2002 WL 1484396 (S.D. N.Y. 2002).

    While I have great respect for the authors' views, let there be no misunderstanding that I am not a big fan of the "in camera" approach. This is because I believe it could lead to great and potentially incriminating disclosures. Compare US v. Melchor-Moreno, 536 F. 2d 1042 (5th. Cir. 1976) (expressing reservations as to the question of whether in camera proceedings are any kind of substitutes for use/derivative use immunity); 373 F. 2d 622 (3rd. Cir. 1967) (expressing serious reservations as to whether in camera hearings promote maximum disclosure in derogation of a witness's Fifth Amendment right/privilege). Those disclosures might be available to a grand jury despite assurances from the judge that they will be kept under seal. See In re: Grand Jury Subpoena, 836 F. 2d 1468 (4th. Cir. 1988) (holding that grand jury subpoena trumps confidentiality/sealing order); In re: Grand Jury Proceedings (Williams), 995 F. 2d 1013 (11th. Cir. 1993) (following the 4th. circuit, rejecting the 2nd. circuit's decision in Martinell, and holding that a grand jury subpoena trumps a district court's confidentiality order); In re: Grand Jury Subpoena Served on Meserve, 62 F. 3d 1222 (9th. Cir. 1995) (following the 4th and 11th circuits' position). See also Maness v. Meyers, 419 U.S. 449 (1975) (in a case originating in Texas and raising the clear and distinct possibility that a witness waives his or her 5th amendment right if he or she testifies, even with a compulsion order, without an actual grant of use/derivative use immunity in accordance with applicable federal or state law). See further Anonymous Commentary posted on this site on October 13, 2009 1:11 PM.

    I would note that in Bell, the presiding judge used the summonee's in camera submissions against him.

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  5. Jack,

    I would like to commend to your readers the article entitled "THE FIFTH AMENDMENT RIGHT AGAINST SELF-INCRIMINATION" authored by Attorney F. Clinton Broden, Broden & Mickelsen, Dallas, Texas. (Link: http://www.brodenmickelsen.com/documents/5thA.pdf).

    I would like to draw your readers attention to page 13 of the article, wherein Mr. Broden states in clear and unmistakable terms: "YOU MUST READ AND REREAD Doe and Hubbell IF YOU REPRESENT A WITNESS WHO IS COMPELLED TO PRODUCE DOCUMENTS TO A GRAND JURY OR AT TRIAL."

    I would also suggest that your readers pay particular attention to pp. 21-24, wherein Mr. Broden discusses Act-of-Production Immunity, Hubbell and Ponds.

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  6. To the Readers of this blog, I goofed today and responded to the comments on a blog of a different topic. This caused comments to my comments to then be accumulated on the blog on a different topic. I will try to reconstruct the comments related to this blog topic here in the sequence of the discussion so that readers can follow the discussion.

    My apologies for this error, but please read on because Anonymous offers some very excellent comments and leads for further reading.

    Jack Townsend

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  7. Jack posted this comment at 1:12pm:

    Anonymous,

    Your contributions to the discussion are outstanding. Thank you again.

    I would like briefly to return to the Shadley case and focus on the deposit slips. I presume that a bank representative would testify that when the bank gets a deposit, the bank routinely stamps the deposit slip presented by the depositor so that he has a receipt for the deposit. So, when the depositor receives the stamped deposit slip, he has possession and the bank's routine practice would establish the likelihood of the depositor's possession at some point (the point of deposit). And, even if the deposit were presented by another, the other would take the receipt at the direction of the depositor and thus the depositor would have constructive possession of the receipt.

    Of course, of the depositor no longer at the time of the compulsory process has possession of the deposit slip(s) (either actual or constructive), that is a complete defense that the defendant has to establish (however miinimal the showing that is required to show lack of possession). But, it seems to me tha the Government would have made a prima facie showing of the type required in Hubbell / Norwood / Ponds, subject to the defendant making the minimal showing that he or she can't produce becuase he or she no longer has possession or control.

    I do suppose that, if the depositor no longer has control because he or she destroyed the deposit slip(s) in a potentially criminal act, making the showing of lack of possession might itself have Fifth Amendment implications. But that is not what occurred in Shadley where the depositor produced the documents in camera.

    So, I will soon read the materials you cite and may have to come back with something further.

    Thanks again,

    Jack Townsend

    July 28, 2010 1:12 PM

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  12. Jack,

    In the course of my research into Fifth Amendment jurisprudence I have found a potentially important but troublesome decision by the Georgia Supreme Court. See Feig v. Feig, 272 S. E. 2d 723 (Ga. 1980).

    Here is the Westlaw summary:

    "Former wife filed motion seeking to hold former husband in contempt for failure to furnish a current financial statement as well as the first page of former husband's state and federal income tax returns as provided in the property settlement agreement incorporated into the judgment of divorce. The Fulton Superior Court, Ward and Jenrette, JJ., overruled former husband's claim of a Fifth Amendment privilege and found him in contempt of court. Former husband appealed. The Supreme Court, Hill, J., held that where the husband, who was represented by counsel, voluntarily and intelligently waived constitutional and statutory safeguards against self-incrimination as part of the quid pro quo of the property settlement agreement, the privilege against self-incrimination could be voluntarily waived by the property settlement agreement as to future income tax returns and financial information covering future financial events unknown at the time of entering into the contract, and, therefore, the former husband was required to produce the agreed and requested financial information."

    Id. at 723.

    The Georgia Supreme Court's decision could prove quite useful to the IRS. Much like what we see in plea agreements offered by the various US Attorneys Offices, I could see the IRS's Counsel (or the US Attorney's Office or the US DoJ's Tax Division for that matter) insist upon a taxpayer's waiver of the Fifth Amendment privilege in connection with just about any agreement between the taxpayer and the IRS.

    Although Feig v. Feig is binding only in Georgia, it is a reported decision from a court of last resort that could conceivably be used to persuade a federal or state court judge to conclude that where the record demonstrates that an individual who was represented by counsel voluntarily and intelligently waived his or her constitutional and statutory safeguards against self-incrimination as part of the quid pro quo of an agreement, the privilege against self-incrimination could be voluntarily waived by such agreement as to just about any documents or oral testimony (including financial information covering future financial events unknown at the time of entering into the contract). Accordingly, the individual could be required to produce the agreed records and give oral testimony upon demand.

    Further, where an individual represented by counsel enters into an agreement which has the necessary effect of waiving a constitutional right, express notice of or reference to such waiver is not required See Feig v. Feig, 272 S.E. 2d at 724, citing Garner v. United States, 424 U.S. 648 (1976).

    OBSERVATION: The Georgia Supreme Court has emphasized that an individual represented by counsel can enter into an agreement calling for a broad (perhaps even unbridled) waiver of his or her Fifth Amendment right. This strongly implies that an unrepresented individual cannot be deemed to have made a knowing and voluntary waiver of such fundamental right. This certainly raises the question as to whether an unrepresented individual could be viewed under a more accommodating standard. See Haines v. Kerner, 404 U. S. 419 (1972) (pleadings filed by pro se litigants must be viewed under a less strict standard).

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  13. Jack,

    Thank you for your feedback. Please take a close look at Eleventh Circuit's 1996 decision in In re: Grand Jury Subpoena Dated April 9, 1996 (Joan Smith), 87 F. 3d 1198, 1201-1202 (11th. Cir. 1996).

    July 28, 2010 1:49 PM

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  14. Also, please check out footnote 3 in the 11th Circuit's decision distinguishing the same from Rylander:

    The instant case is distinguishable from United States v. Rylander, 460 U.S. 752, 103 S.Ct. 1548, 75 L.Ed.2d 521 (1983), in which the Court held that where a claim of lack of possession is raised for the first time at a contempt hearing for failure to produce documents, the witness has the burden of proving a present inability to comply, even where this requires providing oral testimony. Id. at 759, 103 S.Ct. at 1554. In that case, after Rylander refused to comply with an IRS summons, the district court issued an order to show cause why the order should not be enforced. Id. at 754, 103 S.Ct. at 1551. Rylander failed to file a responsive pleading, did not appear for the show cause hearing, and did no more than send an unsworn letter to the court stating that he was not the president of the corporation and that he did not possess the records. Id. The court found that he possessed the documents and ordered the summons enforced. Id. at 761 n. 3, 103 S.Ct. at 1554 n. 3. Rylander did not seek reconsideration, neither did he appeal. Id. at 754, 103 S.Ct. at 1551.

    Having never raised a claim of inability to comply with the summons (and the court having found to the contrary), the only issue before the court at the contempt hearing was whether Rylander had the present ability to comply with the order-he was not permitted to raise his original inability to comply with the original summons. Id. at 757, 103 S.Ct. at 1552 (“[A] contempt proceeding does not open to reconsideration the legal or factual basis of the order alleged to have been disobeyed....”) (quoting Maggio v. Zeitz, 333 U.S. 56, 69, 68 S.Ct. 401, 408, 92 L.Ed. 476 (1948)). At the contempt hearing, where there was a presumption of continued possession of the documents, Rylander had the burden of demonstrating his present inability to comply. Id. The Rylander Court held, therefore, that in defending a contempt charge where the defendant had not previously challenged his inability to comply with a summons to produce documents (and where the court had already found that the defendant had possessed the documents), a defendant may raise only the defense of a present inability to comply. The Court further held that in making such a defense, the burden of proving that inability is on the defendant, even if doing so requires testimony that may be self-incriminating. The Court did not address the question of whether a defendant could be forced to provide self-incriminating oral testimony in a subpoena enforcement proceeding or in support of a motion to quash a subpoena. See White Collar Crime: Survey of Law-1983 Update, 21 Am.Crim.L.Rev. 179, 181-82 (1983) ( “ Rylander leaves open the question of whether resort to the privilege against self-incrimination in a subpoena enforcement proceeding will shift the burden of proving availability to the government.”). As our opinion makes clear, a defendant may not be forced to testify under these circumstances. Inability to comply, however, may possibly be provable by means other than defendant's own testimony.

    July 28, 2010 1:51 PM

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  15. Missing Corporate Documents: An Analysis of the 11th Circuit's 1996 Decision in In re: Grand Jury Subpoena Dated April 9, 1996 (Joan Smith)

    In any criminal income tax investigation, or most any fraud inquiry, for that matter, control of relevant documents often dictates the outcome of the investigation. A case decided in 1996 by the U.S. Court of Appeals for the 11th. Circuit clearly illustrates several of the governing principles of law relating to the battle for documents.

    In re Grand Jury Subpoena Dated April 9, 1996 (Joan Smith), 87 F.3d 1198 (11th Cir. 1996), the court confronted a case involving Joan Smith, the sole officer and director of a corporation. A federal grand jury in Miami had served a subpoena calling for her to produce records of the corporation. She challenged the subpoena, asserting not only that she did not have the records in her possession, but also that if she were questioned about the location of the documents, she would assert her Fifth Amendment privilege not to incriminate herself. The federal district judge in Miami rejected her argument, held her in contempt, and ordered her imprisoned until she complied with the Court's order to testify concerning the documents. The imprisonment sanction was stayed to allow consideration by the Court of Appeals.

    While the constitutional protection against compelled self-incrimination afforded by the Fifth Amendment permits an individual from being forced to give evidence against himself, the general rule is that the Fifth Amendment protects only against the making of compelled oral declarations. As a general rule, the Fifth Amendment does not protect papers, with the result that the content of documents is not protected by the Fifth Amendment.

    To this point, Joan Smith wins. The prosecutors' real goal appears to have been to force her to tell them the location of the documents - to give oral testimony which could have provided a link in the chain of evidence that might lead to incrimination- and that is plainly protected under the Fifth Amendment.

    But it's not as simple as that, because the subpoena was not directed to Joan Smith in her individual capacity, but rather as representative of her corporation. The Fifth Amendment is a personal privilege: it protects individuals, not entities like corporations or partnerships or unions. In a 1988 case, Braswell v. United States, 487 U.S. 99 (1988) the Supreme Court ruled that doing business in the corporate form does away with Fifth Amendment protection, even where the corporation consists of only one person. If answering questions as to the location of corporate documents not produced were viewed as a duty of a corporate custodian of documents, Joan Smith was correctly held in contempt for refusing to give the answers.

    Fortunately for Joan Smith, the 11th Circuit ruled that this case fell right in the middle where, for Fifth Amendment analysis purposes, individual meets corporation. True, she was a corporate representative, as the prosecutors pointed out - and she was therefore obligated to produce any documents of the corporation - but she did not possess any corporate documents, so there was nothing to produce. And true also, as the defense noted, that corporate representative or not, she had a Fifth Amendment privilege to refuse to make potentially incriminating oral statements. The Court held that if she had documents they had to be produced, but she could not be compelled to answer orally as to the whereabouts of the records.

    This is Fifth Amendment analysis at its most rarefied. The necessary distinctions are often razor- thin, but they are vital to making a correct analysis in the concrete setting of an actual case.

    BOTTOM LINE: Ms. Smith was energetically and vigrously defended by Dennis Kainen and Alan Weisberg. They are among the finest white collar criminal defense attorneys in Florida. The point is the better and more energetic a witness's defense, the more favorable the outcome for the witness.

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  16. Anonymous,

    All I can is thank you for moving this discussion to a level that I had not anticipated. I have learned from your comments and hope the readers of this blog will as well.

    I again apologize to readers who took the trouble to go through the comments. As noted earlier, they are reconstructed in the time line they were made as comments to an unrelated blog.

    I hope other readers will weigh in on the topic.

    I do want to state just one concern with an expansive reading of the Fifth Amendment Act of Production doctrine. It seems to me that Anonymous is advocating that there is precious few if any instances where the Act of Production doctrine would not apply. If that is the case, it seems to me that we should just adopt Justice Thomas' concern in his dissent in Hubble that any compulsion to produce documents is inconsistent with the Fifth Amendment. I don't think that is what the majority intended in Hubble.

    I think where I end up is that, if the Government has sufficient particularity (that's sufficient not perfect) to support a search warrant, it should be sufficient to support a summons or subpoena. Otherwise, the Government will be compelled more often to use the search warrant where a summons or subpoena would suffice. The search warrant is far more intrusive than the summons or subpoena. So, I think some balancing of the Fifth Amendment concerns with other concerns about encouraging use of the search warrant should weigh in some accommodation between the two. I think Ponds does that nicely by seeming, at least, important a standard like the search warrant standard. It's not perfect, but it does draw a line that courts have dealt with a long time and can administer.

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  17. Jack,

    Have you received and reviewed my analysis of the Georgia Supreme Court's decision in Feig v. Feig, 272 S. E. 2d. 723 (1980)?

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  18. Jack

    In the course of my research into Fifth Amendment jurisprudence I have found a potentially important but troublesome decision by the Georgia Supreme Court. See Feig v. Feig, 272 S. E. 2d 723 (Ga. 1980).

    Here is the Westlaw summary:

    "Former wife filed motion seeking to hold former husband in contempt for failure to furnish a current financial statement as well as the first page of former husband's state and federal income tax returns as provided in the property settlement agreement incorporated into the judgment of divorce. The Fulton Superior Court, Ward and Jenrette, JJ., overruled former husband's claim of a Fifth Amendment privilege and found him in contempt of court. Former husband appealed. The Supreme Court, Hill, J., held that where the husband, who was represented by counsel, voluntarily and intelligently waived constitutional and statutory safeguards against self-incrimination as part of the quid pro quo of the property settlement agreement, the privilege against self-incrimination could be voluntarily waived by the property settlement agreement as to future income tax returns and financial information covering future financial events unknown at the time of entering into the contract, and, therefore, the former husband was required to produce the agreed and requested financial information."

    Id. at 723.

    The Georgia Supreme Court's decision could prove quite useful to the IRS. Much like what we see in plea agreements offered by the various US Attorneys Offices, I could see the IRS's Counsel (or the US Attorney's Office or the US DoJ's Tax Division for that matter) insist upon a taxpayer's waiver of the Fifth Amendment privilege in connection with just about any agreement between the taxpayer and the IRS.

    Although Feig v. Feig is binding only in Georgia, it is a reported decision from a court of last resort that could conceivably be used to persuade a federal or state court judge to conclude that where the record demonstrates that an individual who was represented by counsel voluntarily and intelligently waived his or her constitutional and statutory safeguards against self-incrimination as part of the quid pro quo of an agreement, the privilege against self-incrimination could be voluntarily waived by such agreement as to just about any documents or oral testimony (including financial information covering future financial events unknown at the time of entering into the contract). Accordingly, the individual could be required to produce the agreed records and give oral testimony upon demand.

    Further, where an individual represented by counsel enters into an agreement which has the necessary effect of waiving a constitutional right, express notice of or reference to such waiver is not required See Feig v. Feig, 272 S.E. 2d at 724, citing Garner v. United States, 424 U.S. 648 (1976).

    OBSERVATION: The Georgia Supreme Court has emphasized that an individual represented by counsel can enter into an agreement calling for a broad (perhaps even unbridled) waiver of his or her Fifth Amendment right. This strongly implies that an unrepresented individual cannot be deemed to have made a knowing and voluntary waiver of such fundamental right. This certainly raises the question as to whether an unrepresented individual could be viewed under a more accommodating standard. See Haines v. Kerner, 404 U. S. 419 (1972) (pleadings filed by pro se litigants must be viewed under a less strict standard).

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Please make sure that your comment is relevant to the blog entry. For those regular commenters on the blog who otherwise do not want to identify by name, readers would find it helpful if you would choose a unique anonymous indentifier other than just Anonymous. This will help readers identify other comments from a trusted source, so to speak.