United States v. Hooper

KAUFMAN, J. This is an appeal by the United States of America from a decree of final distribution and settling the first, final and supplemental account of administrator. This decree disallowed the claim of the Internal Revenue Service of the United States Government on the ground that it was not filed within the time provided by law for presentation of claims.

Decedent died in San Francisco on November 22, 1945, leaving as heirs at law a son, Fred A. Hooper, who was appointed administrator of the estate of decedent, and a daughter, Vera Epting. Notice to creditors was published on December 12, 1945.

On November 15, 1949, the estate was appraised at $11,502.90, consisting of $1,502.90 cash and a liquor and tavern business worth $10,000. On December 14, 1949, the administrator’s first accounting showed cash on hand in the sum of $7,364.94.

On December 28, 1949, Vera Epting filed objections to the first account. On January 26, 1950, the Collector of Internal Revenue filed a verified creditor’s claim setting forth decedent’s liability for delinquent income taxes for 1943, 1944 and 1945, plus interest thereon, in the total sum of $5,376.66. An affidavit of the collector attached to this claim stated that no payments had been made on said claim and that there were no offsets which would reduce the balance.

On August 12, 1952, the administrator’s supplemental report was filed. A referee was appointed by the court on December 12, 1952. The referee found that the administrator had carried on the tavern business until March, 1949, when it was sold for $9,000. He also found that objections to the administrator’s salary claim for conducting this business were well taken and on April 23, 1953, the court confirmed the referee’s findings and adopted his recommendations.

On November 19, 1953, the administrator filed a petition for settlement of first account and supplemental and final account and for distribution, again seeking an award for salary, and objecting to the Internal Revenue’s tax claim on the ground that it was an arbitrary assessment not supported by competent evidence.

[524]On February 26, 1954, the United States filed objections to the administrator’s petition and also petitioned for an order requiring the administrator to account or be held personally liable. The petition asserted that the estate was insolvent, that the claim of the United States was duly assessed against the estate and was entitled to priority. The United States also objected to the withdrawal of a sum of $2,145.26 by the administrator, and to said administrator’s failure to account for other sums of $1,081.51 and $1,502.90.