Today’s case highlights the difference in treatment of envelopes with no postmark between the Court of Federal Claims (CFC) and the Tax Court. It turns out that on this issue, petitioners receive better treatment at the Tax Court. Of course, it is better not to find out what a court thinks about a missing postmark. For those filing Tax Court petitions, the ability to electronically file offers an easy way around the postmark/private delivery service/postal delay issue. Credit to Carl Smith for spotting this case and providing much of the text of this post.
I have heard that only 15% of Tax Court petitioners have taken advantage of the post-DAWSON ability to electronically file petitions. The Tax Court is no doubt disappointed at this uptake of a provision that could save it time in processing petitions and in having to decide these types of cases. For a relatively long time, individuals have been able to file electronically in the Court of Federal Claims, district courts, bankruptcy courts and other federal courts. Yet, service from the post office continues its siren song for many petitioners. With the low uptake on the Tax Court’s electronic filing system for petitions, a decent number of practitioners must continue to prefer USPS or a private delivery service, but in many instances the people using the non-electronic filing options are pro se and low income.
The taxpayers in the case at issue did not have an electronic filing option because the document they were filing that causes the problem was not a petition but a refund claim. As of yet, the IRS does not have a way to electronically file refund claims (amended returns) that go back more than two years, apart from original tax returns. Even where you cannot electronically file documents with the IRS, faxing documents to the IRS provides a fast way to transmit them and immediately receive a receipt. But the IRS instructs filers of Form 843 refund claims to mail in the form. The mailing of documents continues to fill the pages of case books with situations where things do not work out.
In an opinion issued by the CFC in a refund case, McCaffery v. United States, No. 1:19-cv-01112 (Ct. Fed. Cl. 2021), the issue was whether the taxpayer could introduce extrinsic evidence of the mailing of a refund claim where the claim arrived at the IRS just after the filing deadline, but the envelope in which the claim came had no postmark. Under regulations, extrinsic evidence is allowed where the postmark is illegible, and the Tax Court has extended the reg.’s reasoning to situations where there is no postmark at all. The CFC disagrees with the Tax Court’s interpretation and would not accept parol evidence in the absence of a postmark. The CFC dismisses the case for lack of jurisdiction, without discussing whether a dismissal for failure to state a claim might be more appropriate (i.e., there is no discussion of the Walby Fed. Cir. opinion which we discuss here in a post by Carl).
Here’s what the CFC wrote about the Tax Court’s position:
Plaintiffs argue that extrinsic evidence may be used to prove the date of mailing for purposes of the deemed delivery rule even when the postmark is absent. They cite a line of cases from the Tax Court holding that extrinsic evidence as to timely mailing must be considered when an envelope contains no postmark at all. Pls.’ Opp. at 5 (citing to Sylvan v. Comm’r, 65 T.C. 548 (1975); Seely v. Comm’r, 119 T.C.M. (CCH) 1031, 2020 WL 201751 (2020); Williams v. Comm’r, 117 T.C.M. (CCH) 1328, 2019 WL 2373552 (2019); Blake v. Comm’r, 94 T.C.M. (CCH) 51, 2007 WL 2011294 (2007); Menard, Inc. v. Comm’r, 41 T.C.M. (CCH) 1279, 1981 WL 10531 (1981); Monasmith v. Comm’r, 38 T.C.M. (CCH) 60, 1979 WL 3117 (1979); Ruegsegger v. Comm’r, 68 T.C. 463 (1977)). That line of cases, however, originates in conceptual errors by the Tax Court in Sylvan.
In that case, much like this one, the Tax Court confronted an envelope with no postmark that was delivered after a deadline. The court found a gap in the statute: “There is nothing at all in the statute or legislative history indicating what Congress intended where the postmark is illegible; where there is no postmark because the petition was inserted in a new postal cover when the original cover was damaged; or where no postmark is affixed due to oversight or malfunction of a machine.” Sylvan, 65 T.C. at 552. “[I]n these circumstances,” the court reasoned, its “task . . . is to ask what Congress would have intended on a point not presented to its mind, if the point had been present.” Id. (quotes omitted). The court concluded, over a dissent, that extrinsic evidence should be admitted to prove the date of mailing for purposes of the deemed delivery rule not only when a postmark is illegible, but where it is absent.
That was erroneous for several reasons. To begin with, the Tax Court was mistaken that the Internal Revenue Code contains “nothing at all . . . indicating what Congress intended” in cases of absent postmarks. Id. Section 6511(a) contains a deadline, and section 7502 contains a deemed-delivery exception that is textually inapplicable when a postmark is missing. There is thus no gap to be filled; a late-received envelope lacking a postmark is simply untimely, whatever the extrinsic evidence might be. When a court treats circumstances covered by a general rule as falling into a gap, the court is not really “ask[ing] what Congress would have intended,” Sylvan, 65 T.C. at 552, but presuming that the statute should say something different.8 See also Antonin Scalia & Bryan Garner, Reading Law: The Interpretation of Legal Texts 94 (2012) (“As Justice Louis Brandeis put the point: ‘A casus omissus does not justify judicial legislation.’ And Brandeis again: ‘To supply omissions transcends the judicial function.’”) (citing Ebert v. Poston, 266 U.S. 548, 554 (1925), and Iselin v. United States, 270 U.S. 245, 251 (1926)).
Besides, when Sylvan was decided, the Treasury had already promulgated the regulation providing for extrinsic evidence of the contents of illegible postmarks, but not absent ones. See Republication, 32 Fed. Reg. 15241, 15355 (Nov. 3, 1967); see also Sylvan, 65 T.C. at 560 (Drennen, J., dissenting) (noting that the regulations then in effect “provide[ ] that if the postmark on the envelope is not legible, the petitioner has the burden of proving the time when the postmark was made”). By sanctioning proof by extrinsic evidence in other circumstances, the Tax Court merely created a new exception that neither Congress nor the administering agency authorized.9 That, too, is inappropriate: A judge should not “elaborate unprovided-for exceptions to a text, as Justice Blackmun noted while a circuit judge: ‘If the Congress had intended to provide additional exceptions, it would have done so in clear language.’” Scalia & Garner, supra, at 93 (citing Petteys v. Butler, 367 F.2d 528, 538 (8th Cir. 1966) (Blackmun, J., dissenting)). Nor should a court assume that because a legislature provided relief from a general rule in one circumstance, similar relief should be applied in other circumstances. See Easterbrook, supra, at 541 (“Legislators seeking only to further the public interest may conclude that the provision of public rules should reach so far and no farther[.]”).
Limiting judicial discretion to elaborate on enacted texts is especially important when it comes to this Court’s jurisdiction. This Court’s authority to hear cases brought against the United States rests on waivers of sovereign immunity which must be interpreted strictly. See Block v. N. Dakota ex rel. Bd. of Univ. & Sch. Lands, 461 U.S. 273, 287 (1983) (“[W]hen Congress attaches conditions to legislation waiving the sovereign immunity of the United States, those conditions must be strictly observed, and exceptions thereto are not to be lightly implied.”); see also, e.g., Sumner v. United States, 71 Fed. Cl. 627, 629 (2006). That makes it inappropriate to find jurisdiction by implying additional exceptions to Plaintiffs’ deadlines, or otherwise enlarging the deemed delivery rule.
In short — contrary to Sylvan — cases like this one are controlled by the plain text of the relevant statutes and regulations. See, e.g., Myore v. Nicholson, 489 F.3d 1207, 1211 (Fed. Cir. 2007) (“If the statutory language is clear and unambiguous, the inquiry ends with the plain meaning.”) (citing Roberto v. Dep’t of the Navy, 440 F.3d 1341, 1350 (Fed. Cir. 2006)).
The result in this case is harsh. Mr. McCaffery has declared — without contradiction, and with some circumstantial corroboration — that he mailed the amended return on a day when it would have been deemed timely, if it only had been postmarked.
In Sylvan, the date of receipt left the court with “no doubt whatsoever” that the envelope was mailed on a day when a contemporaneously applied postmark would have satisfied the deemed delivery rule. 65 T.C. at 550-51. Plaintiffs cite other cases where it seems unfair not to consider evidence of mailing. E.g., Pls.’ Opp. at 8 (citing to Glenn v. Comm’r, 105 T.C.M. (CCH) 1228, 2013 WL 424879 (2013) (noting that the Postal Service’s employee made an error, and but for that error, the envelope in question would have contained a timely postmarked date)). One can even imagine two filings with the same deadline mailed on the same day, one with a missing postmark and one with an illegible postmark, where extrinsic evidence on deemed delivery can only be admitted as to the latter. Like many bright-line rules, the deemed delivery rule might be simple and predictable to administer, but its results are not always satisfying in close cases.
Yet the text controls.