author: WISDOM, Circuit Judge:

text:
    Edgar G. DAILEY, Plaintiff-Appellee, v. TRANSITRON ELECTRONIC CORPORATION, Defendant, and Transitaron Overseas Corporation, Defendant-Appellant.
    No. 72-3323
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    March 15, 1973.

      Horace C. Hall, III, Carlos M. Zaffirini, Laredo, Tex., for defendant-appellant.
    J. G. Hornberger, Lazaro Garza-Gongora, Jr., Laredo, Tex., for plaintiff-appellee.
    Before WISDOM, AINSWORTH and CLARK, Circuit Judges.

       Rule 18, 5 Cir.; see Isbell Enterprises, Inc. v. Citizens Casualty Company of New York et al., 5 Cir. 1970, 431 F.2d 409, Part I.

   WISDOM, Circuit Judge:

.In this case an employee sues his former employer for breach of an employment contract. The district court, 349 F.Supp. 797, held that the contract was governed by the laws of Texas and not the laws of Mexico. The sole issue before us on appeal is whether the district court correctly concluded that the laws of Texas were applicable. We affirm.

I.

The plaintiff, Edgar Dailey, is a mechanical engineer and a citizen of the United States. The defendant, Transitron Overseas, is a wholly owned subsidiary of Transitron Electronics. Both are Delaware corporations with their home offices in Massachusetts. Transitron Overseas has a permit to do business in Mexico. Transitron Mexicana, S.A., is organized under the laws of Mexico and is located in Nuevo Laredo, Mexico, immediately across the border from Laredo, Texas. Of the forty-seven thousand shares outstanding of Transitron Mexicana, S.A., six shares are owned by individuals and the rest are owned by Transitron Electronics. Other subsidiaries of Transitron Electronics conduct business in many locations throughout the United States,

Transitron Overseas buys piece parts from other Transitron subsidiaries and transports them into Mexico where they are assembled by Transitron Mexicana, Title to the pieces remains in Transitron Overseas. The assembled goods are then resold to the subsidiary from whom the pieces were originally bought.

II.

While the plaintiff was residing in California, he was visited by Mr. James Von Horz, vice-president of Transitron, who asked if the plaintiff had an interest in being employed by the defendant. Initially they discussed transferring the plaintiff to Kansas City or Mineral Wells. After further negotiations they orally agreed that the plaintiff would become director of engineering of the Mexican subsidiary. In January and February 1969, the plaintiff travelled to Laredo, Texas, to establish residence and take his pre-employment physical. The plaintiff received a written offer of employment dated February 3, 1969, on Transitron Mexicana stationery, from John Zimmerman, the manager of the Nuevo Laredo plant, and an employee of the Transitron Overseas Corporation. During the month of February 1969 the plaintiff started to work for the defendant corporation but continued to maintain his residence in Laredo, Texas. April 17, 1969, a contract of employment between the plaintiff and the Transitron Overseas Corporation was signed in Nuevo Laredo for three years service. The form of contract was prepared by an employee of the defendant who copied it from a form used by Transitron Electronics Corporation. The plaintiff moved to Nuevo Laredo in July or August 1970 and was discharged by the defendant a short time afterwards in September 1970.

The defendant employer paid the plaintiff by checks drawn on a United States bank, deducting United States soeial security and withholding taxes from his paycheck. Transitron Electronics Corporation paid unemployment compensation taxes on his wages. When discharged he applied for and received benefits with the Texas Employment Commission in Laredo, Texas. He has never received any benefits whatsoever under Mexican law, was never paid by Transitron Mexicana, S.A., and was not eligible for social security benefits in Mexico. He has never filed a Mexican income tax return but has paid all income taxes in the United States.

III.

In a diversity suit, a federal district court must apply the conflicts rules of the forum state. Klaxon Company v. Stentor, 1941, 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477. Texas, the forum state here, follows the traditional rule of applying the law of the place of performance or the law of the place where the contract was made, in the absence of a contrary manifestation of intent by the parties. Austin Building Co. v. National Union Fire Ins. Co., Tex.Sup.Ct.1968, 432 S.W.2d 697. This traditional rule is not conclusive but is presumptively applied if the parties’ intent is not determinable. Thus, before deciding where a contract was made or where it was to be performed, we look to the parties’ intent. Here, that second step is not reached because of the overwhelming relationship of the parties to Texas and the United States. See Res. of Conflicts 2d, §§ 6, 188, 196; Leflar, American Conflicts Law, § 103 False Conflicts (1968).

The plaintiff is a citizen of the United States and the defendant is a Delaware Corporation. The plaintiff contracted with the Delaware corporation and not with the Mexican corporation. In every respect he was treated as an employee of the Delaware corporation and subject to the rights and liabilities of an employee within the United States. In no way was he treated as a Mexican employee. The Mexican plant at which he worked was, but for six nominal shares, owned wholly by the Delaware parent corporation. Cf. Hellenic Lines v. Rhoditis, 1970, 398 U.S. 306, 90 S.Ct. 1731, 26 L.Ed.2d 252. All the parties with whom he negotiated were employees of the parent corporation or one of its subsidiaries within the United States, though some were also employed by the Mexican corporation. What is more, the contract was to be partially performed in Texas.

A second significant route to determining intent is the presumption that the parties intended to make a legally binding agreement. Teas v. Kimball, 5 Cir. 1958, 257 F.2d 817, 823; Texas Gas Utilities Co. v. Barrett, Tex.Sup.Ct.1970, 460 S.W.2d 409; Grace v. Orkin, Tex.Civ.App.1953, 255 S.W.2d 279. Article 40 of the Mexican New Federal Labor Code limits the duration of employment contracts to one year. Here, the contract was for three years and was enforceable in Texas since the writing satisfied the statute of frauds. Texas Business and Commerce Code, § 26.01 V.T.C.A.; Vernon’s Texas Civil Statutes Art. 3995, 26 Tex.Jur.2d 242 (Statute of Frauds § 89). Furthermore the statute of limitations in Mexico for breach of employment contract is two months, a period which the plaintiff failed to satisfy. That limitation period has been held to be substantive and not procedural. Gillies v. Aeronaves de Mexico, S.A., 5 Cir. 1972, 468 F.2d 281. In the district court below the jury found for the plaintiff and awarded him $34,579.99 for the employer’s breach.

We conclude that the intent of the parties was to be bound by the law of Texas. We need not reach any further questions of Texas conflicts rules.

Affirmed.


source: Caselaw Access Project

author: GOLDBERG, Circuit Judge:

license: Public Domain

text:
    Eldo GROGAN and Mrs. Effie Grogan, Plaintiffs-Appellants, v. UNITED STATES of America, Defendant-Appellee.
    No. 72-2791.
    United States Court of Appeals, Fifth Circuit.
    March 16, 1973.
    Rehearing Denied April 9, 1973.
    W. Woodrow Stewart, Joe K. Telford, Gainesville, Ga., for plaintiffs-appellants.
    John W. Stokes, Jr., U. S. Atty., Julian M. Longley, Jr., Asst. U. S. Atty., Atlanta, Ga., Scott P. Crampton, Asst. Atty. Gen., Meyer Rothwacks, Dennis M. Donohue, Attys., Tax Div., Dept, of Justice, Washington, D. C., for defendantappellee.
    Before GEWIN, GOLDBERG and DYER, Circuit Judges.
   GOLDBERG, Circuit Judge:

“It must often be said of the Internal Revenue Code of 1954, that of all the good intentions with which the road to hell is paved, this represents the best. Certainly the intention of Section 481 to codify case law and ad-' ministrative interpretation is a pavement block all its own. Hopefully, the courts will offer judicial arbitration of interpretations of the statute in the near future. In the meantime, we must live with codified confusion instead of uncodified chaos.”
—William H. Fletcher

Many courts have already faced the task of interpreting Section 481, and this is yet another case raising novel questions regarding the application of that statute. The precise issue before us is whether the transformation of a taxpayer’s interest in pre-1954 inventories and receivables — from that of a sole proprietor to that of a partner with a 91.6 percent interest in a partnership that now owns the items — justifies including those items when computing taxable income at the time Section 481 adjustments are made, even though those amounts would have been excluded had taxpayer’s sole proprietor status continued unchanged. The question seems never to have arisen before, and its resolution is not easy. The district court, 846 F.Supp. 564, held that the partnership was a new entity, distinct from the individual taxpayer, and that therefore taxpayer did not strictly satisfy Section 481’s terms and conditions and was not entitled to exclude the pre-1954 amounts. We disagree, and we find that the policies implicit in the statute are better served by allowing taxpayer to exclude from consideration in the year of change those partnership inventories and receivables that were previously owned by taxpayer and that were on hand before the statute took effect in 1954.

I. BACKGROUND

The central problem at which Section 481 is directed is the potential over-taxation, under-taxation, or loss (for income tax purposes) of items such as inventories and accounts receivable at the time a taxpayer changes his method of reporting. When a cash-basis taxpayer switches to the accrual basis, for example, the following problem is likely to arise:

“If in the year of change the taxpayer deducts his opening inventory and does not report as income accounts receivable at the close of the preceding taxable year, [absent some adjustment] there is a double deduction of the inventory to the extent it was paid for and deducted in previous years, and an entire omission from income of the accounts receivable at the close of the last taxable year in which the cash basis was used.”

To meet this problem before Section 481 was enacted in 1954, the Commissioner adopted the practice of granting his consent to a voluntary change in accounting methods only if the taxpayer agreed to transitional adjustments to prevent items from being taxed twice, deducted twice, or omitted altogether. See, e. g., American Automobile Ass’n v. United States, 1961, 367 U.S. 687, 81 S.Ct. 1727, 6 L.Ed.2d 1109. Following a period of uncertain and inconsistent treatment of cases where the change was not voluntary, the uniform rule emerged that “when the Commissioner compelled the change in the method of accounting, adjustments could not be required as to prior years.” E. g., Commissioner v. Dwyer, 2 Cir. 1953, 203 F.2d 522.

Specifically taking note of the state of the law as judicially interpreted, the Congress enacted Section 481 of the Internal Revenue Code of 1954:

§ 481. Adjustments required by changes in method of accounting
(a) General rule. — In computing the taxpayer’s taxable income for any taxable year (referred to in this section as the “year of the change”)—
(1) if such computation is under a method of accounting different from the method under which the taxpayer’s taxable income for the preceding taxable year was computed, then
(2) there shall be taken into account those adjustments which are determined to be necessary solely by reason of the change in order to prevent amounts from being duplicated or omitted, except there shall not be taken into account any adjustment in respect of any taxable year to which this section does not apply unless the adjustment is attributable to a change in the method of accounting initiated by the taxpayer.
(b) Limitation on tax where adjustments are substantial.— . . . .

We have previously said of this statute,

“By § 481 the 1954 Code expressed the legislative policy that no item should be omitted and no item should be duplicated as a result of a change in a method of accounting or reporting income for taxation. The provisions were to apply both in the ease where the taxpayer voluntarily changes his accounting method with the consent of the Commissioner and also in the case where a change in the method is required by the Commissioner.”

Commissioner v. Welch, 5 Cir. 1965, 345 F.2d 939, 942. But the statute clearly left intact the case law holding that changes in accounting and reporting not initiated by the taxpayer could not justify making adjustments as to pre-1954 amounts. By its very terms the statute requires that

“there shall not be taken into account any adjustment in respect of any taxable year to which this section does not apply unless the adjustment is attributable to a change in the method of accounting initiated by the taxpayer.”

The impact of the statute is clearly to allow some amounts of income to escape taxation. Where the taxpayer had inventories or accounts receivable on hand on December 31, 1953, for example, those amounts cannot be used to compute Section 481 adjustments when the taxpayer later changes his method of reporting unless the taxpayer initiates the change. Congress was well aware of this result when it enacted the statute, and the Senate Finance Committee report on this section of the Code expresses an unequivocal intention not to impose a burden, as to pre-1954 items, “that would be harsher on taxpayers in most instances of involuntary change than the results of recent court decisions.”

With that understanding of the effect Section 481 may have in some circumstances, we turn now to the particular facts of the case before us.

II. THE OPERATIVE FACTS

Taxpayer, Eldo Grogan, is a Georgia-poultry farmer who beginning sometime prior to 1950 operated as a sole proprietor a business that had (1) a broiler-growing portion, and (2) a feed mill portion. He kept his books and records and filed his income tax returns on the cash receipts and disbursements method of accounting. Taxpayer has always used the calendar year as his annual accounting period.

On December 31, 1953, taxpayer’s sole proprietorship had accounts receivable totaling $86,957.56 for poultry sold, accounts receivable totaling $172,545.69 representing feed and chickens furnished to contract growers, and a feed inventory of $2,000. There were no accounts payable on that date.

In November of 1959, taxpayer’s wife and her brother, William Mills, as trustee for taxpayer’s three minor children, formed a partnership known as the Grogan Poultry Company. The Grogan Poultry Company acquired the broiler-growing portion of taxpayer’s business. The Grogan Poultry Company used the accrual method of accounting.

On January 2, 1962, taxpayer and his brother, A. J. Grogan, as trustee for taxpayer’s three minor children, formed a partnership known as the Grogan Feed Company. Taxpayer contributed the feed mill portion of his proprietorship to the Grogan Feed Company. On the same day, taxpayer made gifts of $6,000 to each of his three minor children and permitted his brother, as trustee for the children, to invest the $18,000 total by purchasing a “share” of the Grogan Feed Company. As a result of these transactions, taxpayer owned a 91.6 percent interest in the Grogan Feed Company and his children owned the remaining 8.4 percent interest. The Grogan Feed Company elected to use the cash receipts and disbursements method of accounting.

The Grogan Feed Company sold practically all of its feed to the Grogan Poultry Company. Because it used the accrual method of accounting, the Grogan Poultry Company deducted the amounts of its purchases in the year of purchase and carried them on it books as accounts payable until paid. Because it used the cash basis method of accounting, the Grogan Feed Company did not report its sales to the Grogan Poultry Company until the accounts were actually paid.

In 1963 the Commissioner of Internal Revenue examined the tax returns filed by taxpayer and by the Grogan Feed Company for the years 1959 through 1962. The Commissioner made certain adjustments to reflect income but did not change the method of accounting used by the Grogan Feed Company.

In 1966 the Commissioner examined taxpayer’s individual returns and the Grogan Feed Company’s partnership returns for the years 1963 and 1964. Pursuant to Section 446(b) of the Internal Revenue Code of 1954, the Commissioner changed the partnership’s method of accounting for 1963 and all future years from the cash method of accounting to the accrual method. The Commissioner asserted that the change was necessary because the cash method of accounting did not properly reflect the partnership’s income. Invoking Section 481(a), the Commissioner included all of the Grogen Feed Company's receivables, as of December, 1963, as already accrued income. It is stipulated that some of these items were attributable to pre1954 years, i. e., they were accrued when taxpayer was still operating as a sole proprietor. The Commissioner’s Section 481(a) adjustments resulted in additional income in the amount of $159,011.57 being included in the Grogan Feed Company’s partnership return.

Based on these adjustments, the Commissioner assessed tax and interest against taxpayer for his distributive share of the partnership’s additional income. Taxpayer paid the additional income taxes, penalties, and interest in the total amount of $123,330.93 then filed a claim with the Internal Revenue Service for a refund. Following the denial of that claim, taxpayer filed this action. The court below, acting on stipulated facts, entered a judgment denying the refund, and this appeal followed.

III. THE DISTRICT COURT’S REASONING

The United States District Court recognized the central issue presented by this case, and stated the positions of the parties regarding the resolution of that issue as follows:

“Plaintiffs argue that under section 481, defendant had no right to include in Grogan Feed Co.’s partnership income for 1963 its inventory and deferred receivables as of December 31, 1963, without giving credit for the inventory and deferred receivables of Eldo Grogan’s proprietorship as of December, 1953. Defendant contends that the Grogan Feed Co. partnership is, for the purposes of section 481(a), a distinct entity, i. e., a “taxpayer”, separate from its individual partners and different from its predecessor sole proprietorship; that, since the partnership did not exist prior to 1962, no portion of the adjustment in dispute can actually be attributed to pre-1954 receivables of the partnership, and, thus, the partnership was due no credit for such items.”

Finding no cases in point, the court turned for guidance to three “somewhat analogous” cases: Pittsfield Coal & Oil Co., 25 Tax Ct.Mem. 11 (1966); Estate of Biewer, 41 T.C. 191 (1963); and Ezo Products Co., 37 T.C. 385 (1961). In each of these cases a successor in interest to one who had owned receivables in 1953 was denied the benefit of the exclusionary provision of Section 481(a) when adjustments were later made to the successor’s returns. The court below correctly read these three cases to stand for the general proposition that a new taxable entity, separate and distinct from the previous owner of pre-1954 receivables, cannot invoke the exclusionary language of Section 481(a).

Recognizing that partnerships are sometimes treated by the Code as “entities” and at other times as mere “conduits” to the partners, the District Court nevertheless concluded that the Grogan Feed Company partnership “is not for the purposes of section 481 a mere continuation of its predecessor proprietorship, but a separate entity not entitled to the benefit of its predecessor’s pre-1954 taxable years . . . ” Based on this reasoning, the court held that Section 481(a) justified adjusting taxpayer’s income for the year of change without excluding the pre-1954 amounts. Judgment was entered accordingly, and the ameliorative provisions of Section 481(b) were then applied.

IV. THE APPLICABLE LAW

As was the District Court, we are unable to discover any previously decided cases that are dispositive of the precise issue before us. We disagree with the District Court, however, regarding the approach to be used in determining whether taxpayer can invoke the exclusionary provisions of Section 481(a). The court below reasoned that because a partnership is sometimes considered a “taxpayer” under the Code, the use of the word “taxpayer” in Section 481(a) must, on the facts of this case, refer to the partnership itself. That premise led to the conclusion that because the partnership did not own the amounts in question on December 31, 1953, the exclusionary provisions of Section 481(a) are unavailable. We disagree with this approach, and‘we find that to allow the labeling of the successor’s status to govern the issue of tax liability is to exalt form over substance.

The proper inquiry is whether the person who will be liable for the tax occasioned by Section 481 adjustments can invoke the exclusionary provisions of Section 481(a). The obvious import of the exclusionary language of Section 481(a) is to excuse from taxes on pre1954 receivables and inventories any person who (1) owned those amounts on December 31, 1953, and (2) would be liable for taxes on them solely because of a Section 481 adjustment not initiated by the taxpayer. The unfairness that Section 481 was trying to avoid would not be availed if Grogan, as an individual taxpayer, is not to be treated as such because he became a partner. To put the matter in its clearest light, it is undisputed that if Grogan had sold 8.4 percent of his receivables, he would nonetheless be entitled to claim the benefit of the Section 481(a) exclusion for pre1954 amounts as to the remaining 91.6 percent.

This approach is entirely consistent with the cases relied upon by the District Court. None of the prior cases have involved a change in form from an individual to a partnership. Rather, the benefit of Section 481 (a)’s exclusion for pre-1954 amounts has been denied only where the transmutational change in status was from a sole proprietorship to a corporation, from a sole proprietorship to a decedent’s estate, or from a partnership to a corporation. In each of these instances, the successor was itself taxable tin the amounts it had acquired. But the interests of a shareholder and of a sole proprietor áre of different species, as is also true of an estate based upon the holdings of a decedent. Here, however, the interest as partner was the same as it was as proprietor, at least for Section 481 tax treatment. Both before and after Grogan formed the partnership, he was personally liable for any tax upon the receivables — only the percentage of his ownership has been altered by the change in status.

The benefit bestowed by Section 481 (a)’s exclusionary clause is personal to the one who owned the amounts in pre-1954 years. The partnership’s adjusted income may indeed include the entire amount of income added by reason of the Section 481 adjustment. But when computing the individual tax liability of the partners, Grogan, and only Grogan, may claim the Section 481(a) exclusion, for only Grogan owned the receivables prior to 1954. We do not read or apply Section 481(a) in a semantic seance, finding that “a partnership is not a proprietorship” and therefore the statute’s exclusionary effects are to be given no substance. Instead, we focus on the real out-of-pocket taxpayer and find him to be Grogan, be he a 100 percent proprietor or a 91.6 percent partner.

The principal intent on the part of Congress in enacting Section 481 was to ensure that after 1954 no item should escape taxation or be over-taxed or under-taxed at the time a taxpayer changes his method of accounting or reporting income, regardless of who initiated the change. But we cannot overlook the clear expression in the statute of a secondary intent to excuse liability for taxes on pre-1954 amounts that become taxable solely by reason of Section 481 adjustments where (1) the taxpayer owned the amounts before 1954, and (2) the taxpayer did not initiate the change. The primary purpose is to prevent either inequitable taxation or windfalls from accruing to taxpayers. The government here would have us disregard the secondary intent of the statute and award the government a windfall of its own.

In wrestling with this problem, the Congress knew that a cut-off date would involve a windfall. It may not have measured meteorologically the statute’s tornadle impact in every case, and it may not have forecast this exact chicken-farmer case. But the Congressional scissor-hold that threw out pre-1954 inventories and receivables was not a foul throw — it was a permissible pinning down, openly seen and openly arrived at by the Congress, of all such future amounts. Congress knew that there were golden eggs that it would neither count nor recoup, but in order to pluck the feathers of varying hues from all future pullets with equity when accounting changes were made, either voluntarily or forced, Congress decided that a few Grogans would be able to feather their nests. A temporary disequilibrium was to be permitted in order to establish a future certainty and tranquility when the winds of accounting changes swept the tax atmosphere.

The case must’ be reversed and remanded to the District Court for a re-computation of Eldo Grogan’s proper tax liability in accordance with this opinion. Reversed and remanded.

      . Fletcher, Section 481: Changes in Accounting Methods, N.Y.U. 18th Inst, on Fed. Tax 161 (1960).

      . See, e. g., cases compiled in 2 Mertens, Law of Federal Income Taxation §§ 12.21, 12.21a.

      . The court below stated the issue as follows :
      “In light of the facts and arguments, the Court is presented with this novel question, which both parties agree is not governed by any existing precedent: Where a person who has operated a business as a sole proprietorship joins with other persons to operate the same business as a partnership and where the former sole proprietor owns an interest of more than 90% in the capital and profits of the partnership, is the partnership a continuation of the sole proprietorship for the purposes of I.R.C. § 481(a) so that pre-1954 inventories and accounts receivable of the proprietorship may be credited against the partnership’s inventories and accounts receivable in 1968, the year in which the government changed the partnership’s accounting method from cash to accrual'1”

      . For an excellent “capsulated discussion of the statutory-decisional background” of Section 481 see Commissioner v. Welch, 5 Cir. 1965, 345 F.2d 939, 942-943. See also Yager, The Dilemma Under Section 481, N.Y.U. 16th Inst, on Fed. Tax 565, 566-569 (1962).

      . 2 Mertens, Law of Federal' Income Taxation § 12.21 at 100.

      . Compare Ross v. Commissioner, 1 Cir. 1948, 169 F.2d 483, with Fowler Bros. & Cox, Inc. v. Commissioner, 6 Cir. 1943, 138 F.2d 774. Bee also Goodrich v. Commissioner, 8 Cir. 1957, 243 F.2d 686.

      . Commissioner v. Welch, 5 Cir. 1965, 345 F.2d 939, 942.

      . See S.Fin.Comm.Rep. on H.R. 8300, 83d Cong., 2d Sess., U.S.Code Congressional & Administrative News at pp. 4696—4697 (1954); H.R.Rep. No. 1337, H.R. Ways & Means Comm.Rep. on H.R. 8300, 83d Cong., 2d Sess., U.S.Code Congressional & Administrative News at 4075 (1954).

      . The language reading “unless the adjustment is attributable to a change in the method of accounting initiated by the taxpayer” was added by the Technical Amendments Act of 1958, Title I of Pub. Law 85-866, § 29(a) (1), and made retroactive to January 1, 1954. Id. § 29(d) (1). Bee also id. § 29(d) (2).

      . Subsection (b) contains various limitations on the amounts by which liability for taxes can be increased by using subsection (a) and sets out procedures for “softening” the tax blow when subsection (a) is applied.

      . The new provisions apply to taxable years beginning after December 31, 1953, and ending after August 14, 1954, the date of the enactment of the 1954 Code. 26 U.S.C. § 7851(a) (1)(A).

      . See note 8 supra.

      . S.Fin.Comm.Rep. on H.R. 8300, supra note 8, at 4697.

      . “Taxpayer” refers to Eldo Grogan. His wife, Effie Grogan, is a party to this action only because joint returns were filed for the years in question.

      . A partnership itself is riot subject to income tax. 26 U.S.O. § 701. Rather, each partner is taxed on his distributive share of the partnership’s income, regardless of whether it is actually distributed. See 26 U.S.O. § 702(a); Treas.Reg. § 1.702-1 (a).

      . See note 3 supra.

      . See, e. g., 26 U.S.O. § 703(b); Demirjian v. Commissioner, 3 Cir. 1972, 457 F.2d 1, 5-6; Brookshire v. Commissioner, 4 Cir. 1960, 273 F.2d 638; Swartz v. Commissioner, 42 T.C. 859 (1964).

      . See, e. g., 26 U.S.C. §§ 701, 702.

      . See note 10 supra. Taxpayer is satisfied with the court’s application of Section 481(b) and does not appeal from that part of the judgment.

      . Pittsfield Coal & Oil Co., 25 Tax Ct. Mem. 11 (1966).

      . Estate of Biewer, 41 T.C. 191 (1963).

      . Ezo Products Co., 37 T.C. 385 (1961). See also Dearborn Gage Co., 48 T.C. 190 (1967).

      . Commissioner v. Welch, 5 Cir. 1965, 345 F.2d 939; Graff Chevrolet Co. v. Campbell, 5 Cir. 1965, 343 F.2d 568. Cf. Falk v. Commissioner, 5 Cir. 1964, 332 F.2d 922.

      . “We have seen that under the [prior law] if the Commissioner forced a taxpayer to change ids accounting method from cash to accrual, the taxpayer would escape forever taxation upon the inventory or accounts receivable which existed at the beginning of the year of change.”
      Yager, supra note 4, at 568-569.

      . “The section included, however, a very important limitation upon the principle that income should not be omitted and deductions should not be duplicated. Section 481(a) (2) created an “Iron Curtain,” December 31, 1953, for calendar-year taxpayers, by providing that adjustments to income for the year of change should be limited to those which are attributable to years subject to the 1954 Code. By this provision, Congress in effect forgave the tax liability which should have been paid upon inventories and accounts receivable which had been accumulated for years by cash-basis taxpayers.”
      Yager, supra note 4, at 569-570.

      . “[I]t seems clear from the statute and the appropriate Committee Reports that Congress fully realized that, by creating the December 31, 1953 cut-off date in Section 481, it was permitting a taxpayer to avoid taxation on pre-1954 inventory completely . . ." Yager, supra note 4, at 573.


author: BUTZNER, Circuit Judge:

text:
    Carl Eugene PHILLIPS, Appellant, v. The CHESAPEAKE AND OHIO RAILWAY COMPANY, Appellee.
    No. 72-1660.
    United States Court of Appeals, Fourth Circuit.
    Argued Dec. 4, 1972.
    Decided March 14, 1973.

      Willard J. Moody, Portsmouth, Va. (Raymond H. Strople, Moody, McMurran & Miller, Portsmouth, Va., on brief), for appellant.
    Aubrey R. Bowles, Jr., Richmond, Va. (Aubrey R. Bowles, III, Richmond, Va., on brief), for appellee.
    Before BOREMAN, Senior Circuit Judge, and CRAVEN and BUTZNER, Circuit Judges.
   BUTZNER, Circuit Judge:

Carl Eugene Phillips appeals from a judgment entered upon a jury verdict in favor of the Chesapeake and Ohio Railway Company denying him recovery for injuries he suffered in two unrelated accidents. He principally complains about the district court’s refusal to submit to the jury the issue of negligence with respect to the first accident and the issue of compliance with the Safety Appliance Act with respect to the second. He also assigns error to the admission and exclusion of evidence and to several of the court’s instructions. Because the evidence presented factual issues for determination by the jury, we reverse and remand for a new trial.

I

The court limited the question of the C&O’s liability for Phillips’ first accident to the Safety Appliance Act. In determining whether the ease should also have been submitted to the jury under the Federal Employers’ Liability Act, we “look only to the evidence and reasonable inferences which tend to support” Phillips’ claims. Wilkerson v. McCarthy, 336 U.S. 53, 57, 69 S.Ct. 413, 415, 93 L.Ed. 497 (1949). Phillips was working as a field brakeman on a crew that was moving bad-order cars to a shop track at the C&O Fulton Yard, Richmond, Virginia. His job was to stop the bad-order cars from rolling back if they failed to couple with stationary cars already on the shop track.

Testimony about the accident was in dispute, but Phillips’ version was as follows: A bad-order car failed to couple after being twice kicked to the shop track. On both occasions Phillips tried unsuccessfully to stop the car by placing a two-by-four under the wheels. On the third attempt to place the car on the shop track, the conductor in charge told him to mount the car and brake it. He did as he was told, but the brake failed to hold. Fearing a collision, he jumped off and injured himself. At trial, the conductor denied he ordered Phillips to ride the car, but he admitted that it was dangerous to ride cars being kicked to the shop track.

Phillips contends that the evidence was sufficient to submit C&O’s negligenee under the Federal Employers’ Liability Act to the jury in three respects: (1) failure to provide adequate instruction and training; (2) failure to promulgate and enforce safety rules; and (3) failure to'provide a safe place to work.

The Supreme Court has restricted the power of a trial judge to withdraw a negligence issue under the Act from the jury:

“Judicial appraisal of the proofs to determine whether a jury question is presented is narrowly limited to the single inquiry whether, with reason, the conclusion may be drawn that negligence of the employer played any part at all in the injury or death. Judges are to fix their sights primarily to make that appraisal and, if that test is met, are bound to find that a case for the jury is made out whether or not the evidence allows the jury a choice of other probabilities.” Rogers v. Pacific R. R., 352 U.S. 500, 506, 77 S.Ct. 443, 448, 1 L.Ed.2d 493 (1957).

Applying this standard, we believe Phillips was entitled to have the jury determine the issue of negligence.

Phillips’ contentions that the C&O was negligent in failing to provide adequate training and to promulgate and enforce safety rules are closely related. Phillips was eighteen years old, and he had received only four days training. He claimed that he had never been warned that mounting a ear being kicked to the shop track was unsafe, nor had he been furnished a rule book prohibiting this practice. The C&O introduced some of its rules, but these did not include a regulation that forbade riding cars being kicked to the shop track. However, one of C&O’s witnesses admitted that the practice was unsafe.

From this evidence, the jury could have found that the railroad had failed in its duty to train Phillips how to work safely as a brakeman on the shop track. Cincinnati, N. O. & T. P. Ry. v. Davis, 293 F. 481, 484 (6th Cir.1923); Erie R. R. v. Collins, 259 F. 172, 177 (2d Cir. 1919). The same evidence would have enabled the jury to find that the C&O was negligent in failing to promulgate and enforce adequate safety regulations. Kimbler v. Pittsburgh & L. E. R. R., 331 F.2d 383, 386 (3d Cir. 1964).

Phillips’ testimony that he was ordered to ride a car being kicked to the shop track, admittedly an unsafe practice, was sufficient to entitle him to have the jury decide whether the railroad, through its conductor, assigned him to an unsafe place to work. Moreover, the testimony of Phillips’ father provided an additional reason for submitting the case to the jury on the grounds that the C&O failed to provide a safe place to work or that the conductor was negligent.

Phillips’ father, who had some 27 years experience as a brakeman, was offered as an expert witness. He testified that, although kicking cars was normally a safe railroad practice, kicking bad-order cars to the shop yard was unsafe because the track was on an incline and the cars had something wrong with them. The district court excluded this testimony because Phillips was unable to prove that the car he was riding was defective.

The evidence should not have been excluded. The C&O’s conductor in charge of the operation knew that many of the bad-order cars had safety defects, although he was unable to testify about the condition of this car. He also knew that it was dangerous to ride a car on the shop track. After two vain attempts to stop the car with a two-by-four, it should have been apparent to the conductor that this car, loaded with scrap iron, was too heavy to be controlled by chocking. From these facts the jury could have found that the railroad was negligent because its conductor ordered the car kicked to the shop track a third time instead of shoving it in by the locomotive, an operation that would have safely controlled the movement of the car.

The evidence conflicted on many of these points, and the railroad raised doubts about the credibility of Phillips’ testimony. But since fair-minded men could differ over the evidence and the inferences that could be justifiably drawn from it, the issue of negligence under the Federal Employers’ Liability Act should have been submitted to the jury. “To deprive [railroad] workers of the benefit of a jury trial in close or doubtful cases is to take away a goodly portion of the relief which Congress has afforded them.” Bailey v. Central Vermont Ry., 319 U.S. 350, 354, 63 S.Ct. 1062, 1064, 87 L.Ed. 1444 (1943).

II

Several months after the first accident, Phillips returned to work and was injured while uncoupling cars. His job on this occasion was to pull the cut lever that releases a pin and uncouples the ear. Phillips testified that he pulled the cut lever and gave the engineer a signal. However, the pin fell preventing the car from uncoupling. He jumped back, pulled the cut lever again, and felt a sharp pain in his leg as he stepped away. There was testimony that it is abnormal, though not unknown, for a pin to fall after it has been released to uncouple a car.

The district judge ruled this evidence was insufficient to show that the coupler was defective, He, therefore, refused to submit to the jury Phillips’ claim that the C&O had failed to comply with the Safety Appliance Act, and he limited the jury’s consideration of the second accident to the question of the C&O’s negligence under the Federal Employers’ Liability Act.

The Safety Appliance Act imposes liability for defective uncoupling devices whether or not the railroad employee is going between cars to uncouple them when he is injured. Southern Pac. Co. v. Mahl, 406 F.2d 1201, 1204 (5th Cir. 1969). Furthermore, the mere failure of a safety device to operate properly at the time the employee is injured is sufficient to show that it is defective even if it operates properly before and after the incident in question. Myers v. Reading Co., 331 U.S. 477, 483, 67 S.Ct. 1334, 91 L.Ed. 1615 (1947). Therefore, testimony that the pin fell abnormally and prevented the cars from uncoupling was sufficient to submit the issue of liability under the Safety Appliance Act to the jury. Cf. Penn v. Chicago & N. W. Ry., 335 U.S. 849, 69 S.Ct. 79, 93 L.Ed. 398 (1948), rev’g 163 F.2d 995, 997 (7th Cir.1947).

Ill

Phillips’ other assignments of error require but brief comment. He complains that admission in evidence of a written statement he gave a C&O investigator following his first accident is barred by Virginia law. The district judge carefully reviewed the federal decisions on this issue. He correctly treated the problem as one of federal law under Rule 43(a) of the Federal Rules of Civil Procedure and properly held the statement admissible. Scarborough v. Atlantic Coast Line R. R., 190 F.2d 935, 941 (4th Cir. 1951).

We find no merit in Phillips’ insistence that the district court should have held him free of contributory negligence as a matter of law. With respect to the claims under the Federal Employers’ Liability Act, this issue presented a question for the jury.

The district court instructed the jury that Phillips did not assume the risk of danger of injury. It added, however, that if Phillips’ injuries were caused by normal risks or hazards which were inherent in the work, and not by the railroad’s negligence or violation of the Safety Appliance Act, Phillips could not recover. This explanation was likely to confuse rather than instruct the jury. Because the doctrine of assumption of risk played no part in the case, all reference to it and to risk inherent in the work could have been omitted from the charge without detracting from it.

We find no merit in Phillips’ other assignments of error. The judgment is reversed, and the case is remanded for a new trial.

      . Section. 1 of the Federal Employers’ Liability Act provides:
      “Every common carrier by railroad . . . shall be liable in damages to any person suffering injury while he is employed by such carrier . . . for such injury . . . resulting in whole or in part from the negligence of any of the officers, agents, or employees of such carrier, or by reason of any defect or insufficiency, due to its negligence, in its cars . . . .”45 U.S.C. § 51 (1970).

      . The term “bad-order” cars included ears needing safety repairs as well as cars requiring only minor alterations, such as addition of loading racks. There is no evidence why the car on which Phillips was riding at the time of the accident had been sent to the shop track.

      . To “kick” a car to the shop track, an engine pushes it towards the track. When the engine stops, the car is allowed to roll freely to stationary cars with which it is supposed to couple on contact.

      . 45 U.S.C. § 2 (1970) provides:
      “It shall be unlawful for any common carrier engaged in interstate commerce by railroad to haul or permit to be hauled or used on its line any car used in moving interstate traffic not equipped with couplers coupling automatically by impact, and which can be uncoupled without the necessity of men going between the ends of the cars.”

      . Va.Code Ann. § 8-293 (1950) provides in part:
      “. . . [I]n an action to recover for a personal injury or death by wrongful act or neglect, no ex parte affidavit or statement in writing other than a deposition, after due notice, of a witness as to the facts or circumstances attending the wrongful act or neglect complained of, shall be used to contradict him as a witness in the case.”


author: PER CURIAM:

text:
    Kermit STUBBLEFIELD, Petitioner-Appellant, v. J. D. HENDERSON, Warden, U. S. Penitentiary, Atlanta, Georgia, Respondent-Appellee.
    Nos. 72-2812, 72-2813.
    United States Court of Appeals, Fifth Circuit.
    March 1, 1973.
    Kermit Stubblefield, pro se.
    John W. Stokes, Jr., U. S. Atty., Anthony M. Arnold, Asst. U. S. Atty., Atlanta, Ga., for respondent-appellee.
    Before GEWIN, COLEMAN and MORGAN, Circuit Judges.
   PER CURIAM:

This appeal comes before us under the provisions of Local Rule 9(c)(2), the appellant having failed to file a brief. We affirm the judgment below.

Appellant, an inmate of the federal penitentiary in Atlanta, Georgia, filed his complaint in the district court alleging that he has been denied the assistance of another inmate to type letters on legal matters. The district court dismissed the petition without prejudice to refile upon exhaustion of administrative remedies. Appellant sought relief from the Bureau of Prisons, which advised him that regulations at Atlanta provide that typewriters and typists are available only for preparation of writs, not for letters. Appellant then refiled his petition in the district court, and the petition was dismissed.

It is well established that an inmate has no federally protected right to the use of typewriters to prepare legal writs. Williams v. United States Department of Justice, 5th Cir. 1970, 433 F.2d 958; Durham v. Blackwell, 5th Cir. 1969, 409 F.2d 838; see also Tarlton v. Henderson, 5th Cir. 1972, 467 F.2d 200. It follows, therefore, that an inmate has no federally protected right to use typewriters for correspondence, whether personal or legal. The judgment below is affirmed.

Affirmed.

      . It is appropriate to dispose of this pro se case summarily, pursuant to this Court’s local Rule 9 (c) (2), appellant having failed to file a brief within the time fixed by Rule 31, Federal Rules of Appellate Procedure. Kimbrough v. Beto, Director, 5th Cir. 1969, 412 F.2d 981.


text:
    UNITED STATES of America, Plaintiff-Appellee, v. Geoffrey Michael AVERY, Defendant-Appellant.
    No. 72-3716
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    March 20, 1973.
    Rehearing and Rehearing En Banc Denied May 8, 1973.
    Gardner W. Beckett, Jr., St. Peters-burg, Fla., for defendant-appellant.
    John L. Briggs, U. S. Atty., Jacksonville, Fla., Claude H. Tison, Jr., Asst. U. S. Atty., Tampa, Fla., for plaintiffappellee.
    Before GEWIN, COLEMAN and MORGAN, Circuit Judges.

       Rule 18, 5 Cir.; See Isbell Enterprises, Inc. v. Citizens Casualty Company of New York et al., 5 Cir., 1970, 431 F.2d 409, Part I.

   PER CURIAM:

Geoffrey Michael Avery was convicted of knowingly and wilfully failing and refusing to perform a duty required of him by law, that is, he failed and refused to report to Local Board #30, St. Peters-burg, Florida, in violation of § 462(a), Title 50 App., United States Code.

The appellant now claims that although he made no effort of any kind whatever to assert such a status he should have been entitled to a conscientious objector classification.

The appeal falls squarely within the decision of this Court in United States v. Taylor, 5 Cir., 1971, 448 F.2d 349.

Consequently, the judgment of the District Court is

Affirmed.


text:
    NATIONAL LABOR RELATIONS BOARD, Petitioner, v. AERO-MOTIVE MANUFACTURING COMPANY, Respondent.
    No. 72-1697.
    United States Court of Appeals, Sixth Circuit.
    Argued Jan. 29, 1973.
    Decided Feb. 8, 1973.

      Marcel Mallet-Prevost, Asst. Gen. Counsel, Peter G. Nash, Patrick Hardin, Alan D. Cirker, Charles N. Steele, N. L. R. B., Washington, D. C., Jerome H. Brooks, Director, Region 7, NLRB, Detroit, Mich., for petitioner.
    Darrel D. Jacobs, Michael F. Ward (Huston & Jacobs), Kalamazoo, Mich., for respondent.
    Before PHILLIPS, Chief Judge, and CELEBREZZE and McCREE, Circuit Judges.
   ORDER

This case is before the court upon the application of the National Labor Relations Board for enforcement of its order reported at 195 N.L.R.B. No. 133. Reference is made to the reported decision of the Board for a recitation of pertinent facts.

We agree that the respondent company was guilty of violating §§ 8(a) (1) and (5) of the Act as found by the Board. The majority of the panel is of the view that this court must enforce, albeit reluctantly, the order that the company pay $100 plus interest to those who engaged in the strike, did not receive the $100 bonus and were recalled to work on or before March 9, 1972. The award to non-strikers was made after a new collective bargaining agreement had been signed. The Board has broad discretion in formulating orders remedying unfair labor practices. Fibreboard Paper Products Corp. v. N. L. R. B., 379 U.S. 203, 216, 85 S.Ct. 398, 13 L.Ed.2d 233 (1964); N. L. R. B. v. Seven-Up Bottling Co., 344 U.S. 344, 346-347, 73 S.Ct. 287, 97 L.Ed. 377 (1953); Phelps Dodge Corp. v. N. L. R. B., 313 U.S. 177, 194-195, 61 S.Ct. 845, 85 L.Ed. 1271 (1941). Further, there appears to be no practical alternative to the remedy prescribed by the Board.

It is ordered that enforcement be granted.

Because of the violence and threats to the personal safety and property of non-strikers which occurred while the strike was in progress, Chief Judge Phillips would deny enforcement of sub-paragraph (a) of paragraph 2 of the order of the Board, as amended April 17, 1972, but would enforce the remainder of the Board’s order.


text:
    UNITED STATES of America, Plaintiff-Appellee, v. Eugene TANNENBAUM, Defendant-Appellant.
    No. 72-2385
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    Feb. 7, 1973.

      Daniel S. Pearson, Miami, Fla. (Court-Appointed but not under Act), for defendant-appellant.
    Robert W. Rust, U. S. Atty., Robert C. Byrne, Asst. U. S. Atty., Miami, Fla., for plaintiff-appellee.
    Before GEWIN, AINSWORTH and SIMPSON, Circuit Judges.

       Rule 18, 5th Cir. See Isbell Enterprises, Inc. v. Citizens Casualty Co. of New York et al., 5th Cir. 1970, 431 F.2d 409, Part I.

   PER CURIAM:

The defendant, Eugene Tannenbaum, was convicted by a jury on two counts of willful misapplication of bank funds, 18 U.S.C. § 656, and three counts of making or causing false entries to be made in a bank ledger, 18 U.S.C. § 1005. Concurrent two year sentences were imposed on each count. On this appeal, Tannenbaum contends that the evidence was insufficient to show that: (1) a connection existed between the misapplication of the bank funds and his status as a bank officer and director, and (2) the entries on the bank ledger were false entries within the meaning of 18 U.S.C. § 1005. Having carefully reviewed the record in this case, we find that the jury was properly instructed as to the elements of each offense and that its verdict was amply supported by the evidence. If we were to uphold Tannenbaum’s contentions on the facts of this ease, the criminal statutes involved would become nullities.

Judgment affirmed.


author: MURRAH, Circuit Judge.

text:
    Alma F. ANDERSON et al., Plaintiffs-Appellees, v. SALT LAKE CITY CORPORATION and Salt Lake County, Defendants-Appellants.
    Nos. 72-1286, 72-1287.
    United States Court of Appeals, Tenth Circuit.
    Argued and Submitted Sept. 18, 1972.
    Decided March 16, 1973.

      Ray L. Montgomery, Asst. Salt Lake City Atty., and Merrill K. Davis, Deputy, Salt Lake County Atty. (Jack L. Crellin, Salt Lake City Atty., and Carl J. Nemelka, Salt Lake County Atty., with them on the briefs), for defendants-appellants.
    Bryce E. Roe, Salt Lake City, Utah (Willi,am G. Fowler, Salt Lake City, Utah, with him on the brief), for plaintiffs-appellees.
    Before MURRAH, SETH and DOYLE, Circuit Judges.
   MURRAH, Circuit Judge.

The Boards of Commissioners of Salt Lake City and Salt Lake County informally permitted the Fraternal Order of Eagles to erect on city-county courthouse grounds a permanent 3 x 5-foot granite monolith inscribed with a version of the Ten Commandments and certain other symbols representing the All Seeing Eye of God, the Star of David, the Order of Eagles, letters of the Hebraic alphabet, and Christ or peace. After erection of the monolith in a prominent place near the courthouse entrance, the Commissioners of the City formally authorized the installation and maintenance of lighting equipment to illuminate and enhance the display, at City and County expense. Similar monoliths have been erected in public places across the United States and Canada— nine of them in Utah — as part of the Eagles’ established and continuing “youth guidance program,” and “. . . to inspire all who pause to view them, with a renewed respect for the law of God, which is our greatest strength against the forces that threaten our way of life.”

The plaintiffs, all residents and taxpayers of Salt Lake County, brought this suit seeking removal of the monolith and an injunction prohibiting the City and County from permitting erection or' maintenance of any similar monument on public land, alleging that the presence of the monolith is a violation of the Establishment Clause of the First Amendment, United States Constitution, and Article 1, Section 4, of the Utah Constitution.

Upon trial, the court, 348 F.Supp. 1170, held that the message conveyed by the monolith was “clearly religious in character;” that by their actions the Boards of Commissioners must be deemed to have adopted the program of the Order of Eagles, with the purpose and primary effect of advancing the cause of religion and certain religious concepts, thus inhibiting the ideas of persons with alternative beliefs, contrary to the prohibitions of the Establishment and Free Exercise Clauses of the First Amendment. Judgment was entered for the plaintiffs. We cannot agree, and, therefore, reverse the judgment.

The City and County challenge the standing of the plaintiffs to bring this suit, alleging lack of a proper nexus between plaintiffs’ status and the alleged constitutional infringement, and failure to show any direct injury. But we think the requisite standing is clearly conferred by non-economic religious values when the plaintiffs assert a litigable interest under the Establishment and Free Exercise Clauses of the Federal Constitution. E. g., Allen v. Hickel, 138 U.S.App.D.C. 31, 424 F.2d 944, 946 (1970), citing Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 153, 90 S.Ct. 827, 25 L.Ed.2d 184 (1970), and Scenic Hudson Preservation Conference v. FPC, 354 F.2d 608, 616 (2d Cir. 1965). We think the plaintiffs have standing based on their beliefs about religion to question whether those beliefs have been infringed upon by an alleged use of public property for religious purposes.

We do not understand either the City or County to contend that the erection and maintenance of the monolith was not done under color of state law, in the constitutional sense in which the question is presented here for decision. Cf. Lowe v. City of Eugene, 254 Or. 518, 463 P.2d 360 (1969), cert. denied, Eugene Sand & Gravel v. Lowe, 397 U.S. 1042, 90 S.Ct. 1366, 25 L.Ed.2d 654 (1970); Allen v. Hickel, supra, 424 F.2d at 947; and Everson v. Board of Education, 330 U.S. 1, 15-16, 67 S.Ct. 504, 91 L.Ed. 711 (1947). The City and County do invoke the abstention doctrine, contending that the federal court should have stayed its hand while the matter in issue is litigated in the state courts under the similar clauses of the state and federal constitutions. But this is not a ease or circumstance calling for abstention of the exercise of federal jurisdiction. The right asserted here is a basic First Amendment right, of which the federal court has jurisdiction, and, although a like provision of the state constitution is involved, proper resolution of the federal right is not conditioned upon resolution of any state question, law, or constitution. See, e. g., Lewis v. Kugler, 446 F.2d 1343 (3d Cir. 1971); Zwickler v. Koota, 389 U.S. 241, 248, 88 S.Ct. 391, 19 L.Ed.2d 444 (1967), quoting Stapleton v. Mitchell, 60 F.Supp. 51, 55 (D.C.Kan.1945); and Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961).

This brings us to the point of applying the Establishment Clause to the facts 'in this case. Surely nothing we can say at this time or place concerning the scope and effect of the Establishment Clause can serve to add to what has already been so prolifieally said elsewhere. From Everson v. Board of Education, supra, to Lemon v. Kurtzman, 403 U.S. 602, 91 S.Ct. 2105, 29 L.Ed.2d 745 (1971), the Supreme Court has treated the Establishment and Free Exercise Clauses under various factual situations with perplexing diversity of views. But throughout all these scholarly and authoritative writings runs a strain of consistency — one clear and distinct tenet of which we can be sure — the Constitution mandates complete government neutrality in religious matters. See, e. g., Everson v. Board of Education, supra; and Abington School Dist. v. Schemp, 374 U.S. 203, 83 S.Ct. 1560, 10 L.Ed.2d 844 (1963).

The government may not “. pass laws which aid one religion, aid all religions, or prefer one religion over another . . . .” Everson v. Board of Education, supra, 330 U.S. at 15, 67 S.Ct. at 511. Nor can one cent of taxpayers’ money be devoted to religious purposes. E. g., Douglas, J., concurrence, Lemon v. Kurtzman, supra, 403 U.S. at 640, 91 S.Ct. 2105, and Everson v. Board of Education, supra, 330 U.S. at 16, 67 S.Ct. 504.

In Lemon v. Kurtzman, supra, Chief Justice Burger reviewed and summarized the case history of the Establishment Clause. Said he, “[o]ur prior holdings do not call for total separation between church and state; total separation is not possible in an absolute sense. Some relationship between government and religious organizations is inevitable. . Judicial caveats against entanglement must recognize that the line of separation, far from being a ‘wall,’ is a blurred, indistinct, and variable barrier depending on all the circumstances of a particular relationship.” 403 U.S., at 614, 91 S.Ct., at 2112. Writing in the same case, Mr. Justice Brennan delineated pertinent standards in these words, “[w]hat the framers meant to foreclose, and what our decisions under the Establishment Clause have forbidden, are those involvements of religious with secular institutions which (a) serve the essentially religious activities of religious institutions; (b) employ the organs of government for essentially religious purposes; or (c) use essentially religious means to serve governmental ends, where secular means would suffice.” 403 U.S., at 643, 91 S.Ct., at 2126, quoting Abington School Dist. v. Schemp, supra, 374 U.S. at 294-295, 83 S.Ct. 1560 (concurring opinion), and Walz v. Tax Commission, 397 U.S. 664, 680-681, 90 S.Ct. 1409, 25 L.Ed.2d 697 (1970) (concurring opinion). From all that has been said, “[t]he test may be stated as follows: what are the purpose and the primary effect of the enactment? If either is the advancement or inhibition of religion then the enactment exceeds the scope of legislative power as circumscribed by the Constitution.” E. g., Abington School Dist. v. Schemp, supra, 374 U.S. at 222, 83 S.Ct. at 1571.

In applying this test, we must strike a balance between that which is primarily religious and that which is primarily secular, albeit embodying some religious impact. A tempered approach obviates the absurdity of striking down insubstantial and widely accepted references to the diety in circumstances such as courtroom ceremony, oaths of public office, and on national currency and coin. E. g., Allen v. Hickel, supra, 424 F.2d at 949. Overzealous rigidity may diminish or ultimately destroy the bulwark we have erected against governmental interference in matters of religion. Walz v. Tax Commission, supra 397 U.S. at 669, 90 S.Ct. 1409. We know that “[t]he Government may depict objects with a spiritual content, but it may not promote or give its stamp of approval to such spiritual content.” Allen v. Hickel, supra 424 F.2d at 948.

The decisions involving factual relationships more closely bearing upon our own case suffer from a lack of unanimity of reasoning and results. A brief reference to those cases serves to bring our case into constitutional focus. A string of lights in the form of a Latin Cross on the side of a courthouse was not a violation of the Establishment Clause because its primary purpose was found to be seasonal decoration of the downtown area for the benefit of business. See Paul v. Dade County, 202 So. 2d 833 (Fla.App.1967), cert. denied, 207 So.2d 690 (Fla.1967), cert. denied, 390 U.S. 1041, 88 S.Ct. 1636, 20 L.Ed.2d 304 (1968). In Allen v. Hickel, supra, the plaintiffs objected to the annual erection of a creche on federal land, as part of a continuing seasonal pageant initiated in 1954. The trial court granted defendants’ motion for summary judgment on grounds that the creche was only one of a group of symbols intended to represent the way Americans celebrate a particular holiday season. The Court of Appeals reasoned that the absence of evidence precluded determination of the “purpose and primary effect” of the creche, and accordingly remanded the case. Plaques were subsequently installed at the display explaining the secular purpose and history of the pageant. On remand the trial court recognized the religious significance of a nativity scene, but, in view of the additional secular significance of the creche in the over-all circumstances of the pageant, held that the religious effect was not substantial, hence the creche was not proscribed. See Allen v. Morton, 333 F. Supp. 1088 (D.C.D.C.1971).

In another ease involving issues similar to those we face here, Lowe v. City of Eugene, supra, the city issued permits for erection of a permanent cross in a municipal park. Despite contentions by the city that the cross was to be a war memorial and an attraction for local business, and that the erection did not involve public expense, the court ordered removal of the monument on grounds that the cross represented preferential treatment of particular religious ideas by the municipality. In another case, an Oklahoma City resident and taxpayer brought a suit seeking an injunction to prevent the city or its officials from maintaining a 50-foot-high Latin Cross at the municipal fairgrounds. The Supreme Court of Oklahoma, affirming unanimously the sustaining of defendant’s general demurrer on grounds that the cross was displayed in a “secular environment” and displayed sectarian ideas only in a “most evanescent” manner, emphasized that the action was brought only under the Oklahoma Constitution, and did not involve a question of federal relief. Meyer v. Oklahoma City, 496 P.2d 789 (Okl.1972), cert. denied, 409 U.S. 980, 93 S.Ct. 314, 34 L.Ed.2d 244.

It is against this background that we determine the “purpose and primary effect” of the subject monolith. The exact origin of the Ten Commandments is uncertain, but testimony in the record aids the supposition that a large portion of our population believes they are Bible based. Even so, an ecclesiastical background does not necessarily mean that the Decalogue is primarily religious in character — it also has substantial secular attributes. Indeed, one of the plaintiffs in our case, a lawyer, admitted while testifying that, “. . . the Ten Commandments is an affirmation of at least a precedent legal code.”

Although one of the declared purposes of the monolith was to inspire respect for the law of God, yet at the same time secular purposes were also emphasized. It is noteworthy that the Order of the Eagles is not a religious organization— it is a fraternal order which advocates ecclesiastical law as the temporal foundation on which all law is based, but this creed does not include any element of coercion concerning these beliefs, unless one considers it coercive to look upon the Ten Commandments. (Although they are in plain view, no one is required to read or recite them. Cf., e. g., Cohen v. State of California, 403 U.S. 15, 91 S.Ct. 1780, 29 L.Ed.2d 284 (1971).)

So the Decalogue is at once religious and secular, as, indeed, one would expect, considering the role of religion in our traditions. After all, “[w]e are a religious people whose institutions presuppose a Supreme Being.” Zorach v. Clauson, 343 U.S. 306, 313, 72 S.Ct. 679, 684, 96 L.Ed. 954 (1952). “It can be truly said, therefore, that today, as in the beginning, our national life reflects a religious people who, in the words of Madison, are ‘earnestly praying, as in duty bound, that the Supreme Lawgiver of the Universe . guide them into every measure which may be worthy of his [blessing...]" Abington School Dist. v. Schemp, supra, 374 U.S. at 213, 83 S.Ct. at 1566, quoting Memorial and Remonstrance Against Religious Assessments, as cited in Everson v. Board of Education, supra, 330 U.S. at 71-72, 67 S.Ct. 504 (appendix to dissenting opinion). “The history of man is inseparable from the history of religion.” See Engel v. Vitale, 370 U.S. 421, 434, 82 S.Ct. 1261, 1268, 8 L.Ed.2d 601 (1962).

It does not seem reasonable to require removal of a passive monument, involving no compulsion, because its accepted precepts, as a foundation for law, reflect the religious nature of an ancient era. See, e. g., Griswold, Absolute is in the Dark — A Discussion of the Approach of the Supreme Court to Constitutional Questions, 8 Utah Law Rev. 167, 173-176 (1963). The wholesome neutrality guaranteed by the Establishment and Free Exercise Clauses does not dictate obliteration of all our religious traditions. See, e. g., Griswold, supra. Although an accompanying plaque explaining the secular significance of the Ten Commandments would be appropriate in a constitutional sense, we cannot say that the monument, as it stands, is more than a depiction of a historically important monument with both secular and sectarian effects.

No one can be the judge of his own objectivity. It may well be that in this blurred, indistinct area of our national life and environment, opinions about the purpose and effect of the monolith are influenced by orthodox or unorthodox propensities. But be that as it may, we are brought to the conclusion that the monolith is primarily secular, and not religious in character; that neither its purpose or effect tends to establish religious belief.

The judgment of the District Court is, accordingly, reversed.

      . For example: In Everson v. Board of Education, 330 U.S. 1, 67 S.Ct. 504, 91 L. Ed. 711 (1947), Jackson and Rutledge, JJ., filed separate dissenting opinions; in Zorach v. Clauson, 343 U.S. 306, 72 S.Ct. 679, 96 L.Ed. 954 (1952), Black, Frankfurter and Jackson, JJ., each filed a separate dissenting opinion; in McGowan v. Maryland, 366 U.S. 420, 81 S.Ct. 1101, 6 L.Ed.2d 393 (1961), Harlan, J., joined Frankfurter, J., in an 83-page dissenting opinion with two appendices; in Abington School Dist. v. Schemp, 374 U.S. 203, 83 S.Ct. 1560, 10 L.Ed.2d 844 (1963), Douglas, Brennan and Goldberg, JJ., each concurred separately, while Stewart, J., dissented ; in Walz v. Tax Commission, 397 U.S. 664, 90 S.Ct. 1409, 25 L.Ed.2d 697 (1970), Brennan, J., concurred specially, Harlan, J., wrote a separate opinion, and Douglas, J., dissented; and, in Lemon v. Kurtzman, 403 U.S. 602, 91 S.Ct. 2105, 29 L.Ed.2d 745 (1971), Black, J., joined Douglas, J., in a special concurrence, while Brennan and White, JJ., wrote separate opinions.

      . See, e. g., J. Stamm and M. Andrew, The Ten Commanments in Recent Research 22-28, et seq. (2d ed. 1962).


text:
    W. S. SHAMBAN AND COMPANY, a corporation, Appellee, v. COMMERCE AND INDUSTRY INSURANCE COMPANY, a corporation, and Does I through V, Appellant.
    No. 26863.
    United States Court of Appeals, Ninth Circuit.
    March 12, 1973.
    Rehearing Denied May 14, 1973.

      David C. Bogert (argued), Richard B. Wolf, of Long & Levit, Los Angeles, Cal., for appellant.
    Herbert N. Wolfe (argued), of Low & Stone, Beverly Hills, Cal., for appellee.
    Before BARNES and WALLACE, Circuit Judges, and ENRIGHT, District J udge.

       The Honorable William B. Enright, United States' District Judge for the Southern District of California, sitting by designation.

   PER CURIAM:

This appeal resulted from an action brought by W. S. Shamban and Company against its insurance carrier for breach of the insurance provisions in which the insurance carrier, Commerce and Industry Insurance Company, failed to pay to its insured amounts due under a business interruption policy in force during a fire at the Fort Wayne, Indiana, plant of plaintiff.

On April 12, 1967, a fire at plaintiff’s plant damaged one production oven and temperature control mechanism of the oven, together with machinery used for processing metal parts. In addition, a recently installed device known as a “Gatlin Gun Sintering Rack,” used in a revolutionary method for producing “core molded” tubes was destroyed.

At the time of the loss there was in effect a policy of insurance between plaintiff, as insured, and defendant, as insurer, under which defendant agreed to indemnify plaintiff for business interruption loss caused by such a fire. More specifically, the policy insured plaintiff against:

“direct loss of earnings on operations which, had they not been prevented would have taken place during . . . the length of time which would have been required with the exercise of due diligence and dispatch to repair, rebuild or replace such of the described property as has been damaged.”

The policy defined “loss of earnings” as:

“the loss to the insured disclosed by comparing actual income and expense . for whatever period is affected with estimated income and expense for the same period assuming there had been no loss.”

Plaintiff was awarded judgment in the sum of $121,000 by the trial court.

Appellant before this court contends the lower court improperly computed appellee’s losses for two reasons. First, defendant maintains that in making Finding of Fact Number 6, the trial court improperly relied upon an unrepresentative prior year’s increase in estimating lost sales for the period of business interruption (suspension period). Secondly, defendant argues that in Finding of Fact Number 6(c), the lower court erred in impliedly determining that plaintiff would have earned 27.58% more sales revenue during the suspension period without incurring any additional labor costs.

The lower court determined that the suspension period was three and one-half months. Following the formula required in the insurance contract, the court projected sales revenue for this period using Shamban Company’s sales performance record as a gauge. Specifically, the court used the rate of growth of sales reflected in the 12 months immediately preceding the suspension period. This figure was 27.58%.

Appellant insurance company objects to this figure as being unrepresentative of the company’s growth record. Appellant aptly points to the growth rate in the year ending March 31, 1966, being 15.79%, and in the year ending March 31, 1965, being 15.79%. Thus, defendant argues, 1967 was an exceptional year which should not be exclusively used.

On the other hand, defendant offers little persuasive evidence that such a growth rate would not continue, at least over the short run. It should be remembered that the base year elected by the trial judge was the 12 month period immediately preceding the fire and ensuing suspension period.

Accordingly, we find that the trial court’s findings on this issue are supported by the evidence, and we concur in those findings. Rule 52(a) Federal Rules Civil Procedure, 28 U.S.C.A.; Ruud v. American Packing & Provision Company, 177 F.2d 538 (9th Cir. 1949).

Defendant, on appeal, also contends that the lower court erred finding that plaintiff would have earned 27.58% more sales revenue during the three and one-half month suspension period without incurring any additional labor cost. Defendant’s argument that this finding is not supported by the evidence is well taken.

Both parties agree that plaintiff is entitled to be reimbursed only for the difference between projected sales revenue and projected cost of goods sold. In this case the trial judge apparently found there would be no concomitant rise in labor cost with a 27.58% rise in sales. Plaintiff contends this result is supported by evidence of record that the new Gatling Gun process greatly increases productivity.

We cannot agree. As defendant points out, the Gatling Gun process is only one stage of production. In fact, the Gatling Gun stage requires only ten persons, whereas the machining stage requires 80 persons, and the finishing stage requires 25 persons. In the absence of contrary evidence, it is logical to project a rise in labor costs in the machining stage and the finishing stage production even if the Gatling Gun stage could effect increased output with no extra labor costs. In fact, the evidence did reveal that some departments at the plant were already working overtime prior to the fire.

Evidence adduced at trial indicated that direct cost of goods sold including labor costs was about 50% of sales revenue for the previous 12 months. The trial court in its Finding of Fact Number 6(c), however, determined that the sum of the continuing costs and expenses which would have attended plaintiff’s lost sales equalled only 35% of the revenue from such sales.

We recognize that we must view the record in the light most favorable to sustain the lower court’s judgment for plaintiff, and Finding of Fact 6(c) of the District Court must be sustained unless “clearly erroneous.” Rule 52(a) Federal Rules of Civil Procedure, 28 U. S.C.A.; County of Ventura v. Blackburn, 362 F.2d 515 (9th Cir. 1966).

“A finding is ‘clearly erroneous’ when although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.” United States v. United States Gypsum Company, 333 U.S. 364 at 395, 68 S.Ct. 525 at 542, 92 L.Ed. 746 (1948).

Appellant contends that the standard of review stated in Rule 52(a) has a diminished function in a case such as this, where the lower court’s fact-finding is based on interpreting data with the aid of expert witnesses rather than judging the credibility of witnesses. Citing the view expressed by the late Judge Frank in Orvis v. Higgins, 180 F.2d 537, 539 (2nd Cir. 1950), appellant urges this court to disregard the trial court’s findings. See also Pacific Vegetable Oil Corp. v. Commissioner of Internal Revenue, 251 F.2d 682 (9th Cir. 1957), Pacific Portland Cement Co. v. Food Machinery & Chem. Corp., 178 F.2d 541 (9th Cir. 1949). The late Judge Clark who drafted Rule 52(a) seemed, however, to be of the opinion that the “clearly erroneous” test should be applied on review even in a case not involving the credibility of witnesses. This court in Lundgren v. Freeman, 307 F.2d 104, 113 (9th Cir. 1962) addressed itself to this question and observed, “It seems to us that the Clark view is favored by history.” We have adhered to this position subsequently. United States v. Ironworkers Local 86, 443 F.2d 544, 549 (9th Cir. 1971). We, therefore, decline to review the evidence de novo and substitute our judgment for that of the trial judge.

After reviewing the record, we are left with the definite and firm conviction that the trial court made a mistake in finding that there would be absolutely no increase in cost, in spite of a 27.58% increase in sales. The trial court should reconsider the evidence on costs and make a new finding in relationship thereto.

Affirmed in part and reversed in part.


text:
    UNITED STATES of America and Elmer W. Holmes, Internal Revenue Agent, Internal Revenue Service, Plaintiffs-Appellees, v. L. Barbee PONDER, Jr., Defendant-Appellant.
    No. 72-2773
    Summary Calendar.

    United States Court of Appeals, Fifth Circuit.
    March 15, 1973.
    Rehearing Denied April 12, 1973.

      L. Barbee Ponder, Jr., pro se.
    Scott P. Crampton, Asst. Atty. Gen., Meyer Rothwacks, Atty., Tax Div., Dept, of Justice, Washington, D. C., Gerald J. Gallinghouse, U. S. Atty., New Orleans, La., Elmer W. Holmes, Agent, I. R. S., Baton Rouge, La., Mary Williams Cazalas, Joseph R. McMahon, Jr., Asst. U. S. Attys., New Orleans, La., for plaintiffsappellees.
    Before WISDOM, GODBOLD and RONEY, Circuit Judges.

       Rule 18, 5th Cir.; Isbell Enterprises, Inc. v. Citizens Casualty Co. of New York et al., 431 F.2d 409, Part I (5th Cir. 1970).

   PER CURIAM:

This is an appeal from an order of the District Court requiring taxpayer to comply with an Internal Revenue summons issued under the authority of 26 U.S.C.A. § 7602. We affirm.

1. There was no abuse of discretion in the denial of taxpayer’s motion for a change of venue. Although a District Court may, for the convenience of parties and witnesses, transfer the action to any other District where it might have been brought, 28 U.S.C.A. § 1404(a), a motion for a change of venue is addressed to the sound discretion of the Court, and the denial of the motion will not be overturned on appeal in the absence of an abuse of discretion. Metropolitan Life Ins. Co. v. Jones, 442 F.2d 1043 (5th Cir. 1971); Nowell v. Dick, 413 F.2d 1204 (5th Cir. 1969).

2. Relying on the fact that the return day specified in the summons was a legal holiday, which date was later changed by means of a letter from the agent issuing the summons, taxpayer asserts that the summons was invalid. Under the circumstances of this case, the District Court committed no error in denying the motion to dismiss the summons. Taxpayer, a practicing lawyer, appeared on the date specified in the supplementary letter, yet he did not question at that time the validity of the summons. By failing to object, taxpayer waived the right to assert this defense.

3. The attorney-client privilege is no defense to the summons. The' privilege applies to communications between lawyer and client, and, to come within the scope of the privilege, an attorney must show that the communication was made to him confidentially, in his professional capacity, for the purpose of securing legal advice or assistance. See e. g., Colton v. United States, 306 F.2d 633 (2d Cir. 1962), cert. denied, 371 U.S. 951, 83 S.Ct. 505, 9 L.Ed.2d 499 (1963). The identity of a client is a matter not normally within the privilege, Frank v. Tomlinson, 351 F.2d 384 (5th Cir. 1965), cert. denied, 382 U. S. 1028, 86 S.Ct. 648, 15 L.Ed.2d 540 (1966), nor are matters involving the receipt of fees from a client usually privileged, see United States v. Finley, 434 F.2d 596 (5th Cir. 1970).

The summons here at issue sought only financial records limited to cancelled checks, bank statements, duplicate deposit slips, and general ledger and cash receipts and disbursements journals, and taxpayer failed to carry his burden of proving that these records fell within the attorney-client privilege. Bouschor v. United States, 316 F.2d 451 (8th Cir. 1963); cf. United States v. Johnson, 465 F.2d 793 (5th Cir. 1972).

4. Taxpayer’s Fifth Amendment privilege against self-incrimination is not a defense to the summons. Although the summons seeks personal financial records, taxpayer made no showing that his claim of privilege was justified. As we stated in United States v. Roundtree, 420 F.2d 845 (5th Cir. 1969),

“[the witness’] remedy is not to voice a blanket refusal to produce his records or to testify. Instead, he must present himself with his records for questioning, and as to each question and each record elect to raise or not to raise the defense. The district court may then determine by reviewing . . . [the witness’] records and by considering each question whether, in each instance, the claim of self-incrimination is well founded.”

420 F.2d at 852. See also United States v. Johnson, supra.

Instead of selectively invoking his Fifth Amendment privilege, taxpayer broadly claimed the privilege. He neither specified particular documents nor advanced any evidence indicating how production of the requested documents and records would incriminate him.

5. Finally, the summons was not invalid because it sought copies, not original records. Taxpayer’s contention that the order violates the “best evidence” rule is wholly meritless. The “best evidence” rule is a rule of admissibility and is limited to situations involving the proof of the contents of a writing. United States v. Duffy, 454 F.2d 809 (5th Cir. 1972).

Affirmed.

      . § 7602. Examination of books and witnesses
      Eor the purpose of ascertaining the correctness of any return, making a return where none has been made, determining the liability of any person for any internal revenue tax or the liability at law or in equity of any transferee or fiduciary of any person in respect of any internal revenue tax, or collecting any such liability, the Secretary or his delegate is authorized—
      (1) To examine any books, papers, records, or other data which may be relevant or material to such inquiry;
      (2) To summon the person liable for tax or required to perform the act, or any officer or employee of such person, or any person having possession, custody, or care of books of account containing entries relating to the business of the person liable for tax or required to perform the act, or any other person the Secretary or his delegate may deem proper, to appear before the Secretary or his delegate at a time and place named in the summons and to produce such books, papers, records, or other data, and to give such testimony, under oath, as may be relevant or material to such inquiry; and
      (3) To take such testimony of the person concerned, under oath, as may be relevant or material to such inquiry.
      Aug. 16, 1954, c. 736, 68A Stat. 901.


author: MEHAFFY, Circuit Judge.

text:
    UNITED STATES of America, Appellee, v. George Robert IRONS and Loretta Fay Irons, Appellants.
    No. 72-1309.
    United States Court of Appeals, Eighth Circuit.
    Submitted Dec. 6, 1972.
    Decided March 9, 1973.
    Certiorari Denied June 18, 1973.
    See 93 S.Ct. 3020.
    Jack S. Nordby, St. Paul, Minn., for appellants.
    J. Earl Cudd, Asst. U. S. Atty., Minneapolis, Minn., for appellee.
    Before MEHAFFY, BRIGHT and STEPHENSON, Circuit Judges.
   MEHAFFY, Circuit Judge.

Defendants, George Robert Irons, Jr. (hereafter Irons) and his wife, Loretta Fay Irons (hereafter Mrs. Irons), were convicted by trial to a jury under an indictment which charged them with a violation of 18 U.S.C. § 2113(a) for attempting to commit a felony by entering the State Bank of Dennison, Minnesota, the deposits of which were insured by the Federal Deposit Insurance Corporation. Each defendant was sentenced to a term of two years. Mrs. Irons’ sentence contained a proviso that after she had served six months of her sentence the remainder was to be suspended and she was placed on probation for eighteen months.

Defendants were jointly tried and represented by the same appointed counsel. Upon the close of the government’s case defense counsel moved for a judgment of acquittal in behalf of Mrs. Irons. This motion was denied and was followed by a motion for severance with the request that the case against Mrs. Irons be submitted to the jury at that point. This motion also was denied. There had been no request for separate counsel at any level prior to this time. Apparently after the close of the government’s case defense counsel concluded that the government had failed to make a case against Mrs. Irons and that her best interests would be served by resting her case at this point. Thereafter Irons took the witness stand as the only witness for the defense.

For reasons hereinafter set forth, we sustain the conviction of Irons and reverse the conviction as to Mrs. Irons.

The issues on appeal are the sufficiency of the evidence to sustain the conviction in both cases and whether defendants were denied their right to separate attorneys.

The case against Irons. The offense was committed in the small village of Dennison, Minnesota, a community of some two hundred fifty residents, approximately fifty miles south of Minneapolis-St. Paul. The few business buildings of Dennison are located on Dennison’s Main Street and run for about five blocks. They include the State Bank of Dennison. Eugene Gillispie, an employee of the local grain elevator, also serves Dennison as its constable and only law enforcement officer. The constable and his wife were at home and had fallen asleep while listening to television. The constable’s home is on Thorpe Street, one block east of Main Street and parallel to it, and is approximately three hundred fifty feet from the rear of the bank building. Mrs. Gillispie awakened at about 3:00 a. m. and noticed a station wagon on her front lawn. The constable went outside.to observe, took the license number of the station wagon, went back in the house, armed himself and called the Northfield, Minnesota police, giving them the license number on the station wagon which was registered in the name of Irons. The constable then took a position where he could observe the figures in the shadows at the rear of the bank building. There is a path that runs across the vacant area in an east-west direction from the rear of the bank to the constable’s home. This property is virtually vacant but does contain a storage shed or two. When the constable and his wife first stepped outside his house, they heard a steady pounding noise emanating from the direction of the rear of the bank. This pounding continued up until the arrival of the Northfield police. Additionally, the constable observed a flashlight in operation. Upon the arrival of the North-field police the pounding ceased and two figures were seen to emerge from the shadows behind the bank and run in the direction of the station wagon parked on the lawn of the constable’s house. The vantage point from which the constable was looking gave him an unobstructed view of the rear of the bank. He observed that the two figures paused a moment by the storage shed and continued to run in the direction of the station wagon. When the two figures were about thirty feet from the constable he ordered them to stop but one of the figures ran off and the other (Irons) continued towards the constable feigning intoxication. Not only the constable but Clifford Witt, a deputy sheriff, testified that there was nothing to indicate Irons’ intoxication.

In their investigation of the area the officers found a gaping hole approximately two feet by three feet in the rear wall of the bank building and some burglar tools, including an eight pound maul, a punch bar and a piece of pipe. The officers observed a reddish substance or dust on Irons’ pants and shoes which resembled the brick dust on the rear wall of the bank. Their search of Irons’ station wagon produced a police radio with inoperative batteries and the dome light cover which was found on the rear seat without a light bulb in its receptacle. When the officers were canvassing the wooded area, they found Mrs. Irons lying on the ground behind a tree. This was approximately ten minutes after the officers had arrived.

It was at this point that the government rested and counsel elected not to put Mrs. Irons on the stand.

Irons categorically denied that he participated in the crime or ever was near the rear of the bank building. If the jury saw fit to believe the testimony of the constable and officers, we have no alternative but to affirm his conviction. We must view the evidence in the light most favorable to the jury verdict, United States v. Skillman, 442 F.2d 542 (8th Cir.), cert. denied, 404 U.S. 833, 92 S.Ct. 82, 30 L.Ed.2d 63 (1971), and we must accept all reasonable inferences that tend to support the jury’s action. See United States v. Lodwick, 410 F.2d 1202, 1204 (8th Cir.), cert. denied, 396 U.S. 841, 90 S.Ct. 105, 24 L.Ed.2d 92 (1969); Phelps v. United States, 160 F.2d 858 (8th Cir. 1947).

This is a case where there could be no doubt about the commission of the crime or that Irons was one of the principals in the guilty act. The constable had taken a position that would permit him to see the figures emerge from the rear of the bank building upon the arrival of the police cars from Northfield. He had the two in his vision from the time the figures first emerged from the shadows at the rear of the building until they came within thirty feet of him and he ordered them to halt whereupon one took off in another direction but Irons continued until met by the constable and other officers. If the government’s case had not been nearly as strong, Irons’ testimony about leaving his home in St. Paul en route to another state without luggage and stopping in Dennison where he had never been before, had no relatives and did not even know anyone there, merely because he had learned from a waitress that they could find a dance in progress in the little village of Dennison, is certainly somewhat incredible and did not impress the jury.

The case against Mrs. Irons. Mrs. Irons was found behind a tree in the wooded area between the rear of the bank and the station wagon that belonged to her husband in the constable’s yard. This places her at the scene of the crime and no doubt with knowledge that a crime was being committed but nothing more. The government contended that she was serving as a lookout and should be convicted under 18 U.S.C. § 2, the aider and abettor statute. There is no evidence that she participated in the criminal act either before or at the time it was committed. She did not have the flashlight which was in use by one of the figures who was seen to depart from the rear of the bank. The canvass of the officers immediately made of the entire area disclosed nothing but her presence. She had nothing to signal with.

It is well settled that absent some evidence of participation we cannot sustain the conviction. United States v. McDonnell, 472 F.2d 1153 (8th Cir. 1973); United States v. Thomas, 469 F.2d 145 (8th Cir. 1972); United States v. Hill, 464 F.2d 1287 (8th Cir. 1972); United States v. Kelton, 446 F.2d 669 (8th Cir. 1971); Baker v. United States, 395 F.2d 368 (8th Cir. 1968).

Single attorney representation of co-defendants. There was no suggestion at any time prior to trial when defendants were represented by retained counsel or by court appointed counsel in this case that there was any need for separate counsel or separate trial, and, of course, no indication that there might possibly be a conflict of interests. We have held in an exhaustive opinion, United States v. Williams, 429 F.2d 158 (8th Cir.), cert. denied, 400 U.S. 947, 91 S.Ct. 255, 27 L.Ed.2d 253 (1970), that joint representation of co-defendants is not per se violative of the sixth amendment and that no reversible error is committed by the district court in assigning a single attorney to represent two or more defendants in a pending criminal action absent evidence of an actual conflict of interests or evidence pointing to a substantial possibility of a conflict of interests between the co-defendants. Our disposition of Mrs. Irons’ case makes unnecessary any lengthy discussion of this subject as there remains no substantial possibility of prejudice or justification for disturbing the judgment of the conviction as to Irons. Compare Glasser v. United States, 315 U.S. 60, 77, 62 S.Ct. 457, 86 L.Ed. 680 (1942); Campbell v. United States, 122 U.S.App.D.C. 143, 352 F.2d 359, 361 (1965).

Accordingly, the judgment is affirmed as to George Robert Irons and reversed with the order to dismiss as to Loretta Fay Irons.

      . In the district court defendant’s name appears as George R. Irons, Jr. and on appeal the “Jr.” is omitted. Reference is to the same party.


text:
    John A. KLOSTER, Appellant, v. S. S. CHATHAM and Waterman Steamship Corporation, Appellees.
    No. 72-1839.
    United States Court of Appeals, Fourth Circuit.
    Argued Feb. 7, 1973.
    Decided March 7, 1973.
    John J. O’Connor, Jr., Baltimore, Md. (O’Connor & Preston, P. A., Baltimore, Md., on brief), for appellant.
    Randall C. Coleman, Baltimore, Md. (Ober, Grimes & Shriver, Baltimore, Md., on brief), for appellees.
    Before HAYNSWORTH, Chief Judge, BUTZNER, Circuit Judge, and BRYAN, District Judge.
   PER CURIAM:

John Kloster, a longshoreman, brought this action for injuries he received while loading pipe from a gondola ear into the S.S. CHATHAM. Kloster alleged unseaworthiness and negligence of the ship’s crew in permitting mooring lines to become slack. The slack, he claims, allowed the CHATHAM to be washed against the pier by the wake of a passing vessel. This movement, he says, caused the ship’s hoisting line to dislodge a section of pipe which struck him. The district court found neither unseaworthiness nor negligence. However, deeming the ease to involve a pierside injury, the court dismissed the suit for lack of admiralty jurisdiction on authority of Victory Carriers v. Law, 404 U.S. 202, 92 S.Ct. 418, 30 L.Ed.2d 383 (1971), and Snydor v. Villain & Fassio et Compania Internazionale di Genova Societa Reunite di Naviagaione S.P.A., 459 F.2d 365 (4th Cir. 1972).

While Kloster’s complaint against the ship and its gear was sufficient" to state a claim within the admiralty jurisdiction of the district court, the findings of fact on the merits of the case are not clearly erroneous. Accordingly, the judgment of the district court is affirmed.