White House Press Release

170 #1286 IMMEDIATE RELEASE AUGUST 8, 1947 MEMORANDUM OF DISAPPROVAL S. 892 (Eightieth Congress, 1st Session), entitled "A BILL for the payment of claims of the Fidelity Trust Company, of Baltimore, Maryland, and others, covered by findings of fact madé by the United States Court of Claims, dated June 5, 1944, and contained in Senate Document Numbered 229, Seventy-eighth Congress, second session" would authorize and direct the Treasury to refund bankers special taxes paid under the War Revenue Act of June 13, 1898, and under the Emergency Revenue Act of October 22, 1914, and later held to have been erroneously and illegally collected by the decisions of the Supreme Court of the United States in the case of the Fidelity & Deposit Co. against United States (259 U. S. 296) and the United States against Fidelity & Deposit Co. (266 U. S. 587) even t though no claim for refund was filed, the taxpayers failed to take the necessary steps to protect their interests and the period provided by statute for the filing of claims for refund of such taxes has long since expired. S. 1654 (77th Congress, 1st Session), a bill for the relief of the Fidelity Trust Co., of Baltimore, Maryland, and others was referred to the Court of Claims in accordance with Senate Resolution 185 (77th Congress, 1st Session), November 10, 1941. Petitions were thereafter filed with the Court in 72 of the 78 cases referred to in S. 1645. NARA The Court of Claims in its findings of fact reviewed in detail the history of the claims covered by S. 1645, except the six claims for which no petitions were filed. The 72 claims considered by the Court are now covered by S. 892, the bill here under consideration. Therefore, the background for the proposed special legislation is clearly and fully set forth in the opinion of the Court in the case entitled Fidelity Trust Co. et al. V. United States (101 Ct. Cls. 831). See Seante Document No. 229 (78th Congress, 2nd Session). The Court points out that many claims for the refund of bankers' special taxes were filed and allowed, but that the 72 claims listed in S. 1645 were rejected by the Bureau of Internal Revenue on the ground that refund was barred because the claims were not filed within the time prescribed by law. The Court also points out that since then numerous efforts have been made in behalf of the various taxpayers for remedial legislation, beginning with S. 5448 (70th Congress, 2nd Session), and continuing in practically every succeeding Congress, a total of 14 separate bills, all of which have been opposed by the Secretary of the Treasury. It was stated by the Court, "Nor do we think that equitable grounds exist merely because some other taxpayers have come within the statute and been granted refunds. * *The plaintiffs are not entitled to either legal or equitable relief. The claims are for gratuities. One of the bills, S. 694 (74th Congress, 1st Session), having passed both Houses of Congress, was presented to President Roosevelt, who vetoed the bill on June 18, 1935. In the veto message the President stated, "Again I must express my belief that the field of special legis- lation should not be opened to relieve special classes of taxpayers from the consequences of their failure to perfect their claims for the refund of taxes within the period fixed by law." Since that time, the facts involved have been reconsidered and after very careful consideration I am unable to find any reason why an exception to the basic policy of the statute of limitations in the Internal Revenue Code should be made in these cases. The facts now presented are the same facts considered by the Court of Claims, and therefore, there are no new facts now presented that might indicate that the action taken in 1935 by President Roosevelt was not proper. The suggestion that some claims were filed of which the Bureau of Internal Revenue has no record is believed to be without merit as these are issues of fact which were properly justifiable and moreover cannot be considered as an argument supporting this bill since admittedly only a very few of the claims are involved in this respect. (OVER)