
    WOOLNER’S CASE.
    A. & S. Woolner v. The United States.
    
      On the Proofs.
    
    
      Certain distillers lose tax-paid stamps before they are affixed lo the cast's. They pay the tax twice to procure a second set of stamps. They then apply to the Commissioner of Internal Beoenue for a refund of the duplicate payment. He allows the claim and certifies it to the accounting officers for payment. The Comptroller of the Treasury rejects it.
    
    I. Tlie maimer in which distilled spirits are gauged, proved, marked, and tlie tax paid tliereon, examined and stated.
    II. Tlie tax-paid stamps issued by collectors for tlie payment of taxes on distilled spirits are notliing more than receipts, and are worthless as receipts to other parties than those to whom they are issued.
    III. 'Where a distiller loses his tax-paid stamps before they are affixed to the cask, and pays the tax again to procure other stamps, the duplicate payment is an overpayment, which may he refunded by the Commissioner of Internal Revenue.
    IV. The Commissioner of Internal Revenue, when considering claims for the overpayment of taxes or a refund of a tax excessive in amount, may take all the facts and circumstances into consideration, and will act upon his own judgment and discretion.
    V. Where the authority is in the Commissioner of Internal Revenue to refund a tax in his discretion, errors in the mere forms of procedure are wholly immaterial, not being within the control of the applicant.
    VI. Where the Commissioner of Internal Revenue, in a case within the scojie of his authority and jurisdiction, has ordered a refund of an overpaid tax, a court canno t inquire as to the sufficiency of the evidence before him.
    VII. Distillers whose tax-paid stamps are lost before being affixed to the cask are not restricted to applying to the Commissioner of Internal Revenue for duplicate stamps under the Revised Statutes (§ 3289). They may pay the tax a second time to the collector and apply for a refund.
    
      The Reporters’ statement of tbe case:
    Tbe following are tbe facts found by tbe court:
    I. On tbe 8tb of July, 1876, tbe claimants were distillers, having their distillery in tbe fifth district of Illinois, and on that day paid tbe internal-revenue tax assessed or due upon ten barrels of alcohol at their distillery, numbered 29289 to 29291 and 29301 to 29307, to the amount of $801, and received from the collector of said district therefor tax-paid stamps numbered 70069 to 70071 and 70081 to 70086 and 3269.
    II. On the 23d of October, 1876, the claimants again paid said tax of $801 on the same barrels of alcohol at said distillery to said collector, and received from him therefor ten other tax-paid stamps numbered 8878 to 8886, 3375.
    III. Subsequently the claimants presented to the Commissioner of Internal Revenue the following claim for refund:
    “ Claim under series '6, No. 14, for taxes improperly paid.
    
    “ State oe Illinois,
    “ Comity of Peoria, ss:
    
    “ Samuel Woolner, in the city of Peoria and State and county aforesaid, being duly sworn according to law, deposes and say's that he is a member of the firm of A. & S. Woolner; that they were engaged in the business of distilling spirits; that upon the twenty-third day of October, A. II. 1876, they were assessed by -, assessor of the-district of said State, an internal-revenue tax of eight hundred and one dollars for ten bbls. alcohol, numbered 29289 to 29291 and 29301 to 29307, which amount he afterwards, on the twenty-third day of October, A. D. 1876, paid to Howard Knowles, esq., collector of internal revenue for the said district; which assessment and payment of the aforesaid tax was, as this deponent verily believes, erroneous and improper, for the following reasons, viz:
    “The tax on the above ten bbls. alcohol (see Nos. 29289-to 29291 & 29301 to 29307, with the following rvarehouse stamps: 833589 to 833591 & 983601-983607) had been paid by us on the eighth day of July, 1876. The tax-paid stamps then obtained, numbered 70069 to 70071 & 70081 to 70086, and 3269, were lost by our teamster on his way to the distillery, and, as I firmly believe, were burned and destroyed by a fire burning at or near the place where he dropped them out of his pocket. In order to make use. of the ten bbls. alcohol we were compelled to pay the tax ($801.00) a second time, which we did on the twenty-third day of October, 1876, receiving the folloAving No. of tax-paid stamps in return: 88878 to 88886 and 3375. And this deponent now claims that by reason of the aforesaid erroneous assessment find payment of the said sum of eight hundred and one dollars they are justly entitled to have the sum of eight hundred and one dollars refunded, and they now ask and demand the same.
    “And this deponent further makes oath that he has not heretofore presented any claim for tlie refunding of tbe above amount or any part thereof.
    “SAMUEL WOOLNER.
    “ Sworn and subscribed before me this 20th day of December, A. D. 1870.
    “HOWARD KNOWLES.
    “ I certify that the facts as stated in the affidavit of Mr. Samuel Woolner are, in mv belief, true.
    “HOWARD KNOWLES,
    
      " Collector.
    
    “Peoria, Ill., Dec. 20tft,.187C »
    IV. Thereafter the Commissioner made the following certificate of his decision or judgment, as required by the rules in relation to the refund of taxes: . .
    
      A schedule of claims foe the refunding of taxes erroneously assessed and paid, which have been examined and allowed.
    
    
      
    
    “ I hereby certify that the foregoing claims for the refunding of taxes erroneously assessed and paid have been examined and allowed.
    “ GREEN B. RAUM,
    “ Commissioner.”
    
    V. On or about the 21st April, 1877, the Secretary of the Treasury approved the said action of the Commissioner of Internal Revenue by a letter of which the following is a copy:
    “ Treasury Department “ Washington, D. C., April 21, 1877.
    “Hon. Green B. RauM,
    “ Commissioner of Internal Revenue':
    
    “ Sir : I return herewith the papers relating to the claim of A. & S. Woolner, of Peoria, Illinois, for refund of $801, an internal-reirenue tax alleged to have been twice paid on ten (10) barrels of alcohol.
    “It appears that on July 8th, 1876, the claimants purchased nineteen tax-paid revenue-stamps, which were lost by their teamster on his way to their distillery.; that as soon as the teamster discovered the loss he returned to search for them, and found nine of the stamps on the street, lying very near a fire made of waste paper and rubbish, and that the remaining ten were never found, but were supposed to have been burned in the fire mentioned. The ten tax-paid stamps thus lost were procured to be affixed to ten barrels of alcohol, and the complainants were compelled to purchase ten .other stamps, at a cost of $801, receiving stamps Nos. 8878 to 8886 and No. 3375.
    “ The evidence is conclusive as to the loss of the ten tax-paid stamps, and the purchase of the second series of stamps, which were affixed to the ten packages of alcohol. The claimants were thus compelled to pay a tax twice on the same packages.
    “ The evidence, however, is not conclusive in regard to the destruction by fire of the ten stamps proved to have been lost, though there is a strong presumption that they were so destroyed, as the nine stamps found were lying very near the fire Avhich was then burning.
    “ In the absence of any circumstance tending to cast suspicion on the parties, the department, in view of all the facts, is of the opinion that the second tax of $801 should be refunded, provided the claimants execute a bond, with sureties approved by the collector of the district, in double the amount refunded, conditioned to indemnify the Government against loss in case any of the stamps lost should be used by any one.
    “ Your recommendation for refund of $801 is accordingly approved upon compliance with the conditions aforesaid, and you will withhold the draft until the bond is executed and approved.
    “ Very respectfully,
    “JOHN SHERMAN,
    “ Secretary.”
    YI. An instrument, of which the following is a copy, was thereupon executed by the claimants, and approved by the collector of the district, and duly filed at the Treasury Department without objection:
    “ Know all men by these presents that we, Adolph Woolner and Samuel Woolner, Jacob Schunbacher and Edwin Pulsifer, are held and firmly bound unto the United States of America in the full and just sum of sixteen hundred and two dollars, money of the United States, to which payment, well and truly to be made, we bind ourselves, jointly and severally, pur joint and several heirs, executors, and administrators, firmly by these presents. Sealed with our seals, and dated this 30th day of April, A. D. 1877.
    “The condition of the foregoing obligation is such, that whereas, by adjudication of the proper officers of the Internal Revenue Department, approved and concurred in by the Secretary of the Treasury, the petition of the firm of A. and S. Woolner, of Peoria, Illinois, has been granted, in the matter of refunding said firm the sum of eight hundred and one dollars arising out of an alleged double payment of tax in consequence of the loss by said Arm of spirit-stamps numbered 70069, 70070 70071, 70081, 70082, 70083, 70084, 70085, 70086, and 3269, said said stamps being known as tax-paid spirit-stamps”:
    “Now, therefore, if all or any of said stamps in the future auditing of accounts or books or in any other manner shall appear to have been used by any person whatever, then the above obligation is to remain in foil force and virtue; otherwise, to be void and of none effect.”
    “ADOLPH WOOLNER,
    “SAMUEL WOOLNER,
    “ By Aclolph Woolner7s Attorney in Fact.77
    
    “EDWIN PULSIFER,
    “JACOB SCHUNBACHER.”
    “ I hereby certify that Edwin Pulsifer and Jacob Schunbacher, the sureties in the within bonds, are personally known to me; that they are citizens of the Uidted States, and residents of the city of Peoria, Illinois; and that they are good and sufficient to pay the penalty of said bond.”
    “HOWARD KNOWLES,
    “ Collector."
    
    
      - VII. The Fifth Auditor, to whom said certificate of allowance by the Commissioner, with the documents above set out, were referred for examination and settlement in the regular course of the business of accounting in the Treasury Department, examined the same and certified to the First Comptroller said amount as due and payable to claimants.
    On the 30th of April, 1877, the Comptroller disallowed the same for the sole reason, as stated by him, as follows: “The •claim of A. & S. Woolner does not grow out of an illegal exaction of taxes, and therefore cannot be refunded in this way.”
    And the allowance of the Commissioner has never been paid.
    (Additional fact found at request of defendants:)
    VIII. The following are substantially the Treasury regulations, series 6, No. 14, as they stood at the time of the transactions referred to in the foregoing findings:
    “FORM 46.
    “Claims for the refunding of taxes and penalties alleged to have been erroneously or illegally collected must be made out upon Form 46. In this case, as in that of claims for abatement upon Form 47, the burden of proof rests upon the claimant. All the facts relied upon in support of the claim should be clearly set forth under oath. Tlie claim should be still further supported by certificates in form as follows :
    
      “Deputy collector’s certificate.”
    
    “ I hereby certify that I have carefully investigated the facts set forth in the within affidavit, and that 1 believe the statements to be in all respects just and true.
    , u_
    
      “Deputy Collector,
    
      “-Division,-District.”
    
    “Dated-, 187 — .
    “ Certificate of cleric in charge of records in office of Commissioner of Internal Revenue
    
    “I hereby certify that, from present personal examination, I find the sum of-dollars and-cents, reported against the said-on page —, line —, of the list on Form —, for-, 18 — ; also the sum of-dollars and-cents reported against-on page • — , line —, of the list on Form —, for-, 18 — , now on file in the office of the Commissioner of Internal Eevenue; and that the tax-included in the collector’s aggregate receipt for the said list transmitted by the assessor to the Commissioner of Internal Eevenue. Said receipt amount to $-.
    u_
    ’ “ Cleric in charge of Records.
    
    “Dated-, 187 — .
    “ Collector’s certificate.
    
    “I hereby certify that I have carefully investigated the facts set forth in the within affidavit, and am satisfied that the statements are in all respects just and true; and I further certify, upon personal examination, that I find the sum of-dollars and-cents reported against the said-on page —, line —, of the list on Form —, for-, 18 — ; and also the sum of-dollars and-cents reported against--on page —, line —, of the list on Form —, for-18 —, now on file in my office, and that the same was paid to me on the-day of-, 18 — , and on the-day of-; — , 18 — , and are included in my aggregate receipts for said lists, the receipts amounting to $-and $-, respectively, and delivered to the assessor to be transmitted to the Commissioner of Internal Eevenue; and that no claim for the assessment herein complained of has heretofore been presented.
    u_
    “ Collector,
    “-District-..
    187 — . “Dated
    
      “A claim for refunding should be made in the name of the party assessed, if living; if he is dead, there should be evidence of his death, and the claim should be made in the name of the executor or administrator. Certified copies of the letters of administration or letters testamentary, or other similar evidence, should be annexed to the claim to- show that the'claimant is administrator, &c.
    “The affidavit may be made by an agent of the party assessed; but, in such a case, there should be evidence of the agency, and of the sources of the agent’s knowledge concerning the casein question.”
    
      Mr. Lewis Abraham for the claimants:
    The claim is a debt of the United States of a specific liquidated amount. The power of the Commissioner of Internal Kevenue is absolute; he is clothed with full and complete equity jurisdiction ; a jurisdiction and control of the most vital force and consequence, because it is incapable of review or reversal.
    “The provisions of the statute referred to seem clearly to sustain the proposition that it was intended by Congress that wrongs and grievances occurring under the internal-revenue acts should be investigated and passed upon, not by the courts, but by the officials immediately charged with their execution, but it is the plain policy of the law that the remedy is not to be by a resort to courts, but to other means pointed out by law.” (C. W. Robaclc v. .72. M. W. Taylor, collector U. S. G. 0., 8. JD. Ohio, 4- Int. Eev. Eec., 170.) Congress certainly did not intend to deny the citizen the benefits of equity, but. simply to confer its exercise on the Commissioner, instead of the courts.
    Petitioners followed the law as required, and if even the merits, are inquired into, the official’s action is within it. (13 Ops. Atty. Gen., 574.) It is, however, not competent for any tribunal to inquire into the reasoning by which these officials arrived at their conclusions; there is no appeal therefrom; it is a matter left to their sole discretion. The claim in question was for an amount that required concurrent action by the Secretary of the Treasury. The jurisdiction of the officials was then exhausted ; they determined the question; awarded an allowance, which no one has the right to question. (See case of Sebastian v.. Kaufman.) A bond of indemnity was tendered and accepted;, this, though not statutory, is good. United, States v. Tingey, 5 Pet., 115,122; United States v. Garlinghouse, 4 Benedict, D. C., 94 .) .
    
      
      Mr. A. D. Robinson (with, whom was tbe Assistant Attorney-’General) for tbe defendants :
    Claimant cannot recover, because tbe decisions of tbe Commissioner and tbe Secretary were not based “ upon proper evidence of facts,” as required by law.
    Section 3426 Revised Statutes provides that “ upon proper evidence of facts ” tbe Commissioner may make allowance for sucb stamps as may bave been spoiled, destroyed, &c.
    If tbe decision of tbe Commissioner and tbe Secretary is prima facie evidence sufficient to recover, we impeach tbe decision by showing that it was based on improper evidence, or, rather, upon no evidence. (See opinion Supreme Court in Kaufman’s Case).
    Tbe proof was not made in accordance with tbe regulations on this subject. (Series 6, No. 14, above referred to.)
    Tbe decision wTas not final, but conditional, and therefore claimant cannot recover.
    This is not a claim growing- out of an illegal or erroneous exaction of taxes, and therefore tbe Commissioner bad not jurisdiction to make an allowance; certainly not unless an absolute destruction of stamps was shown.
   Richardson, J.,

delivered tbe opinion of tbe court :

, This case presents no difficulties upon tbe controlling facts, which fully establish tbe claim set forth in tbe petition, and tbe defense has no foundation in law or justice.

Tbe claimants were distillers of spirits, in possession of ten barrels of alcohol in tbe warehouse of then distillery, upon which there was a tax due of $801. This tax they paid to tbe collector in July, 1876, and again paid tbe same tax to tbe same collector in October of that year. Afterward, they made application to tbe Commissioner of Internal Revenue for refund and payment back of tbe amount thus paid in excess of that which was legally and justly due. (Rev. Stat., § 3220.)

Tbe Commissioner allowed tbe claim, and certified tbe same to tbe accounting officers for payment, where it met -with tbe disapproval of tbe Comptroller.

Those are all tbe material facts; and tbe case is precisely tbe. same in principle, as to the authority of tbe Commissioner of Internal Revenue and tbe force and effect of bis certificate, as that of Kaufman v. United States (11 C. Cls. R., 659), recently affirmed by the Supreme Court ou appeal (96 U. S. R., 568); and w'e might, perhaps rest our decision upon the facts above recited and the opinions of this court and the Supreme Court in that case, but the circumstances under which this double payment was made have been put in evidence, and we will review them with reference to the statute provisions with which they are connected.

When spirits are distilled they are drawn from the cisterns into casks, which are thereupon gauged, proved, and marked by an internal-revenue gauger, and immediately removed into the distillery warehouse, under the care of a G-overnment storekeeper, where they are numbered by serial numbers, and have attached stamps with the number of proof-gallons of spirits contained therein ivritten thereon. (Rev. Stat., §§ 3271, 3273, 3287.) Finch's Case, 12 C. Cls. R., 365.) The amount of the tax then becomes fixed and determined, and the distiller is required to give bond to pay the tax and remove the casks within one year (Rev. Stat., § 3293); recently extended to a longer period.

Within that year the distiller must pay the tax to the collector, who issues what is called a tax-paid stamp, the form of which is prescribed by statute, and which is nothing more than a receipt, specifying each cask by number and quantity of spirits therein, the warehouse, and to whom the cask is for delivery. This stamp is required to be placed on the head of the cask by the gauger, in the presence of the storekeeper, before the same can be removed from the warehouse. (Rev. Stat., §§ 3294, 3295.)

In the present case, when the claimants paid the tax on their ten barrels of alcohol, the tax-paid stamps were not delivered to the gauger by the collector, as it would seem from the collect- or’s certificate to the claimant’s application for refund, but were intrusted to the claimant’s teamster, who, it was alleged, lost the same under such circumstances as might lead to the conclusion, asserted by the claimants, that they had been destroyed. As the claimants could not remove the barrels from the warehouse without stamps thereon, and the collector had no authority to issue stamps except for money, since they are furnished to him by the Government and he is charged therewith, the claimants were obliged or thought it necessary to pay the tax again in order to obtain possession of their alcohol for sale, trusting to the Commissioner to refund the same upon application and presentation of the facts.

They marte application accordingly, and tlie only question of doubt raised before tbe Commissioner was whether or not the stamps were actually destroyed, the fact of double payment being a matter of record apparent upon the books of the collector. For refund under section 3220, this question was material only in connection with the possibility of fraudulent intent on the part of the claimants to use the stamps for other barrels of alcohol, which could not be done excejit in collusion with both the Government storekeeper and gauger, by giving the same numbers to other barrels of the same contents, in the same warehouse, as owned by the same parties, and for delivery to the same persons named in the stamps;' since, for any other purpose, and under other circumstances, and in the hands of persons not named therein, they would be as worthless as receipts running to parties other than the holder. The tax was, in fact, paid twice. It was, in the language of that section, a tax paid ‘'excessive in amount,” and so might be refunded, unless the Commissioner, for reasons satisfactory to himself, should decide otherwise, and in this latter case his decision would be final and conclusive.

It was the- duty of the Commissioner to take all the facts and circumstances into consideration, and to act upon his own,judgment and discretion. The statute gives to him alone the power, u subject to regulations prescribed by the Secretary of the Treasury, * * * to remit, refund, and pay back all taxes erroneously or illegally assessed or collected, * * * and all taxes that appear to be unjustly assessed or excessive in amount, or in any manner wrongfully collected.” (Rev. Stat., § 3220.)

A regulation of the Secretary of the Treasury, prescribed many years ago, requires the Commissioner, in cases involving an amount exceeding $250, and before its final decision, to transmit the same, with the evidence in support thereof, to the Secretary for his consideration and advisement; but it has never been understood in the Treasury Department that the powers and duties of the Secretary extended beyond advising the Commissioner, upon whom alone rests the responsibility of the final decision.

In this case the Secretary had some doubt about the sufii ciency of the evidence of the destruction of the stamps, and advised the taking of a bond of indemnity; but the Oommis-sioner does not appear to have so far adopted the advice as to make the giving of a bond a condition-precedent to the refund, as he certified the amount claimed, without condition, to the accounting officer for payment. However, an instrument was filed, which the claimants intended as a bond, in accordance with the advice and direction of the Secretary, and it was received without objection. The claim was disallowed by the Comptroller on another and different ground.

The allowance might, no doubt, luwe been made under the provisions of Rbvised Statutes,. § 3426, for refunds for “stamps spoiled, destroyed, or rendered useless, or unfit for the purpose intended,” * * * although that section was enacted more particularly with reference to other classes of stamps, which, unlike these tax-paid stamps, if lost and not destroyed, upon falling into the hands of other parties would be of value, and might be used by them without the possibility of discovery, and even without fraud.

Under one or the other of sections 3220 or 3426 of the Revised Statutes the claimants were entitled to relief. The Commissioner chose to act under the former section, and in doing so he entered the allowance, with other caséis in a general printed form for refunding taxes erroneously assessed and paid, making no distinction in the different cases whether “ erroneously or illegally assessed or collected” or “unjustly assessed or excessive in amount, or in any manner wrongfully collected.” The authority was in the Commissioner in all the different cases under both sections, and errors in the mere forms of procedure by him not in violation of his powers and authority are wholly-immaterial, as we pointed out in Kaufman's Case (12 C. Cls. R., 659), where the Commissioner, in his certificate of allowances, referred for his authority to an act which had been repealed instead of to the re-enacted provisions in the Revised Statutes, as he could not well have done otherwise at that time, after the statutes were enacted and before they were distributed. The forms of proceedings by the Commissioner are not within the control of claimants, and they should not lose their rights by any errors or imperfections therein made by him or with his concurrence. It is sufficient if the Commissioner acts within the scope of his authority and jurisdiction, whatever forms he may adopt.

It is urged on behalf of the defendants that the Commissioner did not have sufficient evidence upon which to found his decision. 33ut that is beyond our jurisdiction to determine. When the law intrusts the decision of any question of fact to a designated public officer, the sufficiency of the evidence depends upon his own judgment, and cannot be reviewed by any other officer or any tribunal. What would be sufficient for him might not be sufficient for other minds; and what would be sufficient for others might be quite insufficient for him. It is enough for us to know that the Commissioner acted upon some evidence which was satisfactory to himself. It is also urged that the certificate accompanying the application did not conform to that prescribed by the regulations. That is wholly immaterial, because it does not appear that it was the whole evidence acted upon, and the collector’s certificate was a substantial compliance with the regulation finder the circumstances and in connection with the records which it may be presumed the Commissioner had access to; and, especially, because it was received, accepted, and acted upon by him, and cannot now be excepted to in this court for the first time.

The Comptroller refused to pass the claim, because he held that the tax could not be refunded in that way. Perhaps the claimants might have had one remedy under Revised Statutes, § 3315, by making application for duplicate stamps, although that section seems rather to aj)ply to cases where stamps have once been affixed and subsequently lost or destroyed and new ones are called for in order to restamp the casks, that they may not be seized for violation of law. (Rev. Stat., § 3289.) But even if they had a remedy under that section, it was a limited one, and might have been quite impossible of execution or inadequate in this case. The claimants were in Illinois,' and to obtain duplicate stamps, they were required to make application to the Commissioner of Internal Revenue at Washington, and await the slow process of departmental business, while by law and their bond they must remove the barrels from the distillery within one year from the time they were first stored therein, and that time might' expire before they could obtain duplicate stamps.

But whether or not the claimants had another remedy under that section (Rev. Stat., § 3315), we are of opinion that it did not exclude them from the right to pay the tax a second time, in order to get immediate possession, of tbeir property, and to apply for and obtain a refund under Revised Statutes, section 3220.

Tbe judgment of tbe court is tbat tbe claimants recover tbe sum of $801.

Nott, J., was absent when tbe decision was announced, but was present at tbe bearing and concurs in tbe judgment.  