Ric Ashe Forces IRS to Return Seized Property to Rightful Owner
Ric Ashe of our office recently won an interesting and difficult case in federal court against the U.S. government. The case began when the Internal Revenue Service (IRS) wrongfully seized a rare and valuable 1969 Dodge Charger belonging to our client. As stated by the Court in its written judgment, the case had more than “its share of innuendo and intrigue.”
The IRS seized the car from a classic car museum and consignment shop, where the car was for sale for nearly $850,000.00. The car was taken to the consignment shop by our client’s son, who was the real target of the IRS’ seizure efforts.
The IRS knew our client’s son had a history of buying and selling classic cars, so when they got a tip that he delivered a 1969 Dodge Charger to the consignment shop, they quickly checked car title records at the Missouri DMV and confirmed that our client’s son was the title owner of a 1969 Dodge Charger. The IRS then obtained an order from the Court allowing them to seize the son’s car, loaded up several IRS agents into black SUV’s and headed to the consignment shop to get the car.
Upon their arrival at the consignment shop, the IRS discovered the VIN number for the 1969 Dodge Charger located at the consignment shop did not match the VIN number of the 1969 Dodge Charger titled in the son’s name. No matter. The IRS simply crossed out the “wrong” VIN number on their paperwork, hand-wrote in the “correct” VIN number, and left with the car.
At first, both our client and our firm believed the matter could be resolved without delay. After all, the IRS seized a car with a VIN number that did not match the VIN number of the car they intended to seize. Proving this fact, however, would be considerably more difficult.
No title was ever issued to our client for the car. We had no bill of sale, receipt or other documentation of the sale. Insurance had never been obtained for the car, and we could not show that sales taxes or property taxes had been paid in connection with the car. Worse yet, we did not have our most important witness available to testify. Our client’s husband of 50-plus years the man who purchased the car- passed away just six weeks prior to the seizure.
The only significant documentation we had concerning the purchase of the car was a withdrawal slip showing that our client’s late husband withdrew a large amount of cash from the family bank account approximately one month before the purchase, and a deposit slip showing that he deposited a lesser amount into same bank account within a few days following his purchase of the car. The difference between the withdrawal slip and the deposit slip was the same amount that the parties agreed had been paid for the car, in cash, six years prior.
The person who sold the car to our client’s husband did not agree to cooperate at trial and, thus, the only eyewitness to the transaction available to testify about the car purchase was our client’s son, the alleged tax debtor.
On one hand, our client’s son made a great witness because he had located the car on his parents’ behalf, traveled with his father to Wisconsin to view the car, inspected the car, determined its value and negotiated the purchase price with the seller. He also transported the car to his home for storage, where he primarily kept the car for his parents from the day it arrived in Missouri until the day he took it to the consignment shop. In short, he knew the
facts as well as anyone.
On the other hand, our client’s son had an uneven history with the IRS that made him an easy target for opposing counsel, an experienced trial attorney with the U.S. Department of Justice in Washington, D.C. On cross-examination, the government’s attorney relentlessly tried to paint the son as an anti-tax radical who had convinced his own mother to lie on his behalf to prevent the IRS from seizing his car. Further, from the perspective of the IRS, the son’s extensive role in purchasing the car only confirmed its theory that the son was the real owner of the car.
In the end, however, the bank records proved irrefutable, our client’s son withstood cross-examination, and our client did what she needed to do-she gave the Court a big picture view of the facts that tied the vague and mysterious details of her ownership of the car together. The car has now been returned to our client.