Morris v. Commissioner, 65 T. C. 324 (1975)

Under Tax Court Rule 72, parties seeking production of documents need not show good cause; documents must be produced if they are relevant and not privileged.

Summary

In Morris v. Commissioner, the Tax Court ruled that under Rule 72, petitioners seeking production of documents do not need to demonstrate good cause. The court emphasized that as long as the documents are relevant and not privileged, they must be produced. The case involved a request for third-party statements used in a related criminal case against petitioner Vincent Morris. The court rejected the respondent’s argument that production should be delayed until trial, stating that discovery’s purpose is to bring evidence to light before trial. This decision underscores the importance of early document disclosure in Tax Court proceedings.

Facts

Vincent Morris was acquitted of criminal tax evasion for the years 1966, 1967, and 1968. The Commissioner of Internal Revenue determined deficiencies and fraud additions for those same years. During the criminal investigation, third-party statements were collected and used in both the criminal case and the statutory notice of deficiency. Morris sought these statements under Tax Court Rule 72, which allows for document production without a showing of good cause. The Commissioner objected, arguing that a good cause showing was necessary and that production was premature.

Procedural History

Petitioners requested document production informally on June 9, 1975. The Commissioner objected on July 2, 1975, stating that the requested material was outside the scope of Tax Court discovery procedures. Petitioners filed a Motion for Production of Documents on July 18, 1975. The Commissioner filed objections on August 12, 1975. The Tax Court granted the motion on November 11, 1975, ordering the production of the documents.

Issue(s)

1. Whether Tax Court Rule 72 requires a showing of good cause as a prerequisite to the production of documents.
2. Whether the production of the requested documents was premature and should be postponed until trial.

Holding

1. No, because Tax Court Rule 72, derived from the 1970 amendment to Federal Rule of Civil Procedure 34, does not require a showing of good cause for document production.
2. No, because no reason was shown to postpone production until trial, and the court emphasized the importance of pretrial discovery.

Court’s Reasoning

The Tax Court held that Rule 72 does not require a good cause showing for document production, as it was modeled after the 1970 amendment to Federal Rule of Civil Procedure 34, which eliminated this requirement. The court rejected the Commissioner’s reliance on pre-1970 cases, noting that they were based on an outdated version of the rule. The court also dismissed the Commissioner’s argument that production was premature, stating that discovery’s purpose is to bring evidence to light before trial. The court emphasized that the requested documents were relevant and not privileged, thus meeting the criteria for production under Rule 72. The court cited P. T. & L. Construction Co. (63 T. C. 404 (1974)) to support its position on the discoverability of third-party statements.

Practical Implications

Morris v. Commissioner significantly impacts how document production requests are handled in Tax Court proceedings. Practitioners should note that under Rule 72, they need not show good cause to obtain relevant, non-privileged documents. This decision encourages early disclosure of evidence, allowing parties to better prepare their cases before trial. The ruling also clarifies that objections based on prematurity must be supported by specific reasons, as the court values the pretrial discovery process. This case has been cited in subsequent Tax Court decisions to support the broad scope of discovery under Rule 72, influencing how attorneys approach document requests in tax litigation.