© Copyright 1994 Sovereign Services ALL RIGHTS RESERVED
Introduction
This report addresses two questions:
1. "What are our rights if we get an IRS summons to produce our books
and records?"
2. "What are our rights if the IRS obtains a court order to search
and seize our records from our home or from our place of business?"
The purpose of this report is to inform you what your rights are under U.S. Supreme Court and Federal appellate court case law, and what actions you might take if you're confronted with these issues.
If you're the Managing Director of a Pure Contract Trust and the books and records are owned by the Pure Contract Trust, then only the Trustees can be served with the summons. Obviously, the IRS is barking up the wrong tree if they serve the Managing Director. If that happens, the IRS should be served with a Notice of Refusal instructing them that you're not a principal of the organization, and that it is the Trustees who should be served. The Notice of Refusal could take the following form:
To: _________________________________________
Concerning the summons served upon:
____________________________________________
(Common Law Constitutional Entity)
or ____________________________________________
(Individual)
I, _________________________________, am not a principal of
_________________________________________
(Common Law Constitutional Entity).
While reserving all my rights, I hereby inform you that since I am not the proper Party to be served concerning information about
_____________________________________________
(Common Law Constitutional Entity),
or any other action concerning
_________________________________________
(Common Law Constitutional Entity),
you should direct any such request to the Trustees of
________________________________________
(Common Law Constitutional Entity).
Furthermore, you are hereby informed that the act of production of private records is protected by the Fifth Amendment to the U.S. Constitution - U.S. v. Doe, 104 S.Ct. 1234 (1984).
(Signed) ___________________________
(Dated) ___________________________
Witness (optional) __________________
Place ___________________________
What if the IRS seizes the books and records of a Pure Contract Trust with a valid search warrant? Then, what are your rights? The IRS has seized books and records which are the property of the Pure Contract Trust. Yes, it's time for a Constructive Notice indicating to the IRS that they have seized the property of a constitutional, common-law entity protected by the U.S. Constitution. The Constructive Notice could take the same form as provided in Report #PCT05: The Jurisdictional Challenge.
Suppose that you as an individual operates under statutory law - because you have a birth certificate, social security number, driver's license, etc. Then, "How are your records protected?" Your personal books and records are your private records. You are protected under the privacy provision of the Fourth Amendment, and if you are served with a summons to produce your books and records, you are protected under the self-incrimination provision of the Fifth Amendment not to testify against yourself. "Records sought by subpoena or summons are considered privileged from disclosure by a taxpayer under the Fifth Amendment. Shapiro v. U.S., 335 U.S. 1." Also, see the references at the end of this report: Stuart v. U.S.; U.S. v. Cohen; U.S. v. Kleckner - all U.S. Supreme Court cases.
Your response could be to obey the summons and to take the books and records demanded in a briefcase to wherever the summons demands. However, in response to each specific question you're asked, you invoke the Fifth Amendment. If you're asked whether you're "making a blanket or general objection" to showing your records, you say: "No; I've come here with my books and records as demanded by the summons. I will cooperate with you fully and respond to each individual question you ask me." Your response to each question could then be to decline to answer, invoking the Fifth Amendment.
If you're asked whether you intend to invoke the Fifth Amendment to every question asked, you can respond: "No; it's quite possible that you'll ask me a question that I'll answer differently. But I don't really know how I'll respond until you've asked the question."
The key here is to show good faith and that you're not willfully violating a court order. "I wish to obey all court orders that apply to me, but I will stand on my 5th Amendment rights as I deem appropriate."
You can also respond to a question with: "Before I answer this question (or give you the specific book or record you ask for), can you give me a written guarantee that the information will not be used as evidence against me or to incriminate me?" The probability that a bureaucrat will give you such a guarantee is very close to zero.
Even if your books and records are legally seized from you through a court-ordered search, there may be restrictions on whether or not their contents can be used to incriminate you. See reference, Boyd v. U.S.; Schmerber v. California - both U.S. Supreme Court Cases.
Hill v. Philpott, 445, 2d 144 (1971)
This case concerns the extent to which a citizen's personal books and records
are protected by the Fourth and Fifth Amendments against seizure by government.
Dr. Vincent Hill commenced this action in the Federal district court by
seeking a rule to show cause why certain properties seized pursuant to
search warrants should not be returned and suppressed on the grounds that
the seizure was in violation of his constitutional rights under the Fourth
and Fifth Amendments.
In 1970, the Intelligence Division of the IRS requested from the district court, search warrants directed against Dr. Hill's residence and office based on the following evidence:
1. Affidavits of four former employees of Dr. Hill detailing his office procedures of certain records called "Red Letter Folders" on some patients. The employees were instructed that if the tax man visited the office, one employee should occupy him while the other incinerated the "Red Letter Folders." (You can read between the lines, and wonder what motivated the former employees to volunteer this information. Could it be that they were induced into becoming paid informants?)
2. An affidavit from a "Red Letter" patient of Dr. Hill stated that more than once the canceled checks, after being tendered to Dr. Hill for office visits, came back showing a second endorsement by a department store, indicating that Dr. Hill was using the checks for personal needs, and not reporting it as income. (I suppose we would interpret this as a commingling of funds.)
The district court established "probable cause" for the issuance of the search warrants, and also established that the books and records were the "instrumentalities" of the crimes of tax evasion. On the same day, the IRS agents searched Dr. Hill's home and office and seized 35 cartons of books and records.
Dr. Hill filed a petition for an order directing that the property seized be returned and suppressed on the grounds that the seizure was in violation of his constitutional rights under the Fourth and Fifth Amendments. He also claimed that it deprived him of his property without due process of law in violation of the Fifth Amendment. The district court rejected all his contentions and denied him the request for the return or suppression of the property.
On appeal to the Federal circuit, Judge Campbell ruled as follows:
"In numerous cases where the IRS has sought court enforcement pursuant
to a summons," he said, "the courts have held that a taxpayer
may refuse to produce his books and records by asserting his privilege
against self-incrimination."
The government contended that once the validity of a search is established under the Fourth Amendment, then, whatever the government did is not a violation of the Fifth Amendment.
The judge said that the relationship between the Fourth and Fifth Amendments as pertaining to an individual's right to refuse the production of his books and records, is not a new problem to the courts. "We are unable to understand," he said "that the seizure of a man's private books and records to be used in evidence against him is substantially different from compelling him to be a witness against himself."
There is a difference between "instrumentalities of a crime" as opposed to "mere evidence." In the former, if the property was the fruits of a crime, such as, stolen goods, or the instrumentalities of a crime, the property rights in these items were considered forfeited to the State, and the government had the right to seize such property. In this case, the papers seized were not "instrumentalities of a crime," but were rather "mere evidence" and, therefore, the seizure was in violation of the Fourth Amendment, and their admission into evidence would be a violation of the Fifth Amendment.
The judge also said, "In recent years, this court has zealously guarded the Fifth Amendment rights of citizens confronted with possible penalties or prosecutions for violations of income tax laws. Of course, the Fifth Amendment makes the business of criminal prosecutions more difficult, but this is the clear intent of the Fifth Amendment.
In closing, Judge Campbell said, "The order of the district court is reversed and the case is returned, with directions to reconsider Dr. Hill's petition in light of this opinion."
So, despite all the incriminating evidence against Dr. Hill, the circuit
court still ruled in his favor. However, since 1971 the situation has changed
- as you'll discover in the rest of this report.
The Miranda Warning
The "Miranda warning" must be given to a taxpayer under criminal
investigation by the IRS at the inception of the first contact with the
taxpayer after his case has been transferred to the Intelligence Division
of the IRS for possible criminal prosecution. (Miranda: Warnings given
to an individual that he has a right to remain silent, that any statement
he does or make may be used as evidence against him, and that he has a
right to the presence of an attorney.)
Boyd v. U.S., 116 U.S. 616 (1886)
"And any compulsory discovery by extorting the party's oath, or compelling
the production of his private books and papers, to convict him of a crime,
or to forfeit his property, is contrary to the principles of a free government.
It is abhorrent to the instincts of an Englishman; it is abhorrent to the
instincts of an American. It may suit the purposes of despotic power; but
it cannot abide the pure atmosphere of political liberty and personal freedom."
That was the opinion of the U.S. Supreme Court in 1886. The court also
stated:
"... [B]ut illegitimate and unconstitutional practices get their first
footing in that way, namely by silent approaches and slight deviations
from legal modes of procedure. This can only be obviated by adhering to
the rule that constitutional provisions for the security of person and
property should be liberally construed. A close and literal construction
deprives them of their efficacy, and leads to gradual depreciation of the
right, as if it consisted of more in sound than in substance. It is the
duty of courts to be watchful for the constitutional rights of the citizens,
and against any stealthy encroachment thereon."
Hale v. Henkel, 201 U.S. 43 at 47 (1905)
"There is a clear distinction in this particular case between an individual
and a corporation, and that the latter has no right to refuse to submit
its books and papers for an examination at the suit of the State. The individual
may stand upon his constitutional rights as a citizen. He is entitled to
carry on his private business in his own way. His power to contract is
unlimited. He owes no such duty to the State, since he receives nothing
therefrom, beyond the protection of his life and property. His rights are
such as existed by the law of the land long antecedent to the organization
of the State, and can only be taken from him by due process of law, and
in accordance with the constitution. Among his rights are a refusal to
incriminate himself, and the immunity of himself and his property from
arrest or seizure except under a warrant of the law. He owes nothing to
the public so long as he does not trespass upon their rights." Hale
v. Henkel, 201 U.S. 43 at 47 (1905).
Individual vs. Corporate Records
The Pure Contract Trust has the same rights of privacy as an individual,
protected by the Fifth Amendment. However, a corporation has no such rights,
because it is a "franchise" or "creature" of the state.
There's also a legal doctrine concerning the "act of production" of potentially incriminating documents. The act of production itself could be a potentially incriminating act, and is therefore protected under the Fifth Amendment. An individual cannot be forced to produce records. This protection does not apply to corporations.
Fisher v. U.S., 425 U.S. 391 (1976)
Since this case, the U.S. Department of Justice has operated on the basis
that all private business records (irrespective of their nature)
in the hands of a taxpayer are not protected by the Fifth Amendment
because of the following reasons:
Please note that the Pure Contract Trust is not a taxpayer. There are many cases that have made all kinds of rulings related to taxpayers. In general, these rulings don't apply to the Pure Contract Trust.
Garner v. U.S., 424 U.S. 648 (1976)
In this case the court ruled that Roy D. Garner had waived his Fifth Amendment
right by disclosing information on the IRS Form 1040. It's important to
realize that by voluntarily providing information to any government agency,
you relinquish your Fifth Amendment protection. The 1040 is a confession,
which you should consider very carefully before you sign and submit.
All readers are strongly advised to study all our tax reports, where these and other issues are covered in great detail.
Note that that the above citation talks about "the cooperative taxpayer" and the individual who relies upon his constitutional rights." I believe that these words were carefully chosen. The sovereign individual is not a taxpayer. In general, court rulings about the obligations of "taxpayers" don't apply to "individuals."
U.S. v. Doe, 104 S.Ct. 1234 (1984)
This case is an attempt to further emasculate the Fifth Amendment. In her
concurring opinion, Justice Sandra Day O'Connor wrote:
"I concur on both the result and reasoning of Justice Powell's opinion
for the Court. I write separately, however, just to make explicit what
is implicit in the analysis of that opinion: that the Fifth Amendment
provides absolutely no protection for the contents of private papers of
any kind. The notion that the Fifth Amendment protects the privacy
of papers originated in Boyd v. United States [citations], but our
decision in Fisher v. United States [citations] sounded the death-knell
for Boyd. "Several of Boyd's express and implicit declarations
[have] not stood the test of time." [citations] ... " [emphasis
added]
While the contents of private papers no longer enjoy any Fifth Amendment protection, the act of production does. U.S. v. Doe ruled that in order to compel a witness to produce records (act of production), the witness had to be granted "use immunity." If a witness is granted use immunity, then the records produced cannot be used to incriminate the witness. They also cannot be used in future prosecutions against the witness. Furthermore, the "fruits of the records" also cannot be used to incriminate the witness; that is leads to other records and witnesses that stem from the records produced.
April 15th
For a thorough treatment of the issues addressed in this report, I highly
recommend the book: April 15th: The Most Pernicious Attack Upon English
Liberties by Donald W. MacPherson. Order it by calling 1-800-BEAT-IRS.
Also inquire about Mr. MacPherson's other book: Tax Fraud & Evasion:
The War Stories.
Conclusion
In general, it's prudent to organize your affairs so that books and
records you want to keep private are difficult to locate by outsiders.
For some added protection, many of your records could be located outside the physical jurisdiction of whatever bureaucrat might threaten you sometime. Not only does this often reduce the chance of discovery of those records, but often your bureaucratic enemy will have to concede by his/her own rules that your records can't be seized. For example, USA bureaucrats will often concede that records located outside the USA are not in their physical jurisdiction. Even if they do insist some records are, it is so costly and cumbersome for them to pursue legal procedures in other countries they will often give up - if they can even discover where to look! There are over 200 countries in the world. That's a lot of physical jurisdictions for them to search. And many of them are going to be unfriendly and uncooperative to any meddling bureaucrats from the physical jurisdiction that might be inquiring about you.
For some further ideas on other physical jurisdictions, we recommend the books of Scope International Ltd. You may order our Report #TL22: The Scope Report (Advanced Freedom Technology) for more information about these intriguing and practical books.
It may also be prudent to take steps to remove yourself from statutory jurisdiction by becoming a state citizen (as opposed to a U.S. citizen).
References:
Boyd v. U.S., 116 U.S. 616 (1886); 116 U.S. 638; Hale v. Henkel,
201 U.S. 43 at 47 (1905); Gouled v. U.S., 255 U.S. 298 (1921);
Warden v. Hayden, 387 U.S. 294 (1967); Henry v. U.S., 361
U.S. 98; Beck v. Ohip, 379 U.S. 89; McDonald v. U.S., 335
U.S. 451; Trupiano v. U.S., 334 U.S. 699; Aguilar v. Texas,
378 U.S. 108; Shapiro v. U.S., 335 U.S. 1, 1948); Schmerber v.
California, 384 U.S.757 (1967); Agnello v. U.S., 269 U.S. 20;
U.S. v. United States Coin, 401 U.S. 715; Stuart v. U.S.,
416 F 2d 459 (1969); U.S. v. Cohen, 388 F 2d 464 (1967); U.S.
v. Kleckner, 273 F Supp. 251 (1967); Fisher v. U.S., 425 U.S.
391 (1976); Garner v. U.S., 424 U.S. 648 (1976); U.S. v. Doe,
104 S.Ct. 1234 (1984).
Reports in this series:
#PCT01 - #PCT01A - #PCT02 - #PCT03 - #PCT04 - #PCT05 - #PCT06 - #PCT07 - #PCT07A - #PCT08 - #PCT09 -
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