The opinion
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8 UNITED STATES DISTRICT COURT
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EASTERN DISTRICT OF CALIFORNIA
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11 UNITED STATES OF AMERICA, Case No. 1:18-cv-01318-JLT-SKO
12 Plaintiff, ORDER DENYING MOTION FOR
RECONSIDERATION
13 v.
(Doc. 98)
14 PAUL D. WELDON, STATE OF CALIFORNIA
FRANCHISE TAX BOARD, THE COUNTY OF
15 FRESNO, AND THE CITY OF FRESNO
16 Defendants.
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18 The United States filed this action on September 25, 2018, pursuant to 26 U.S.C.
19 §§ 7401, 7403 to reduce federal tax assessments against Defendant Paul D. Weldon to judgment
20 and to foreclose federal tax liens on residential property owned by Defendant located at 6519
21 West Olive Avenue, Fresno, California, 93723 (“the Property”). (Docs. 1, 40.) On January 25,
22 2023, the Court granted in part and denied in part the United States’ motion for summary
23 judgment, finding that Defendant is indebted to the United States in the amount of $767,041.19
24 for unpaid federal income tax, interest, and penalties for tax years 2000, 2002, 2003, 2004, 2005,
25 2006, 2007, 2008, 2010, 2012, and 2013, less credits according to proof, plus interest and other
26 statutory additions as provided by law. (Doc. 73 at 12.) The Court further ordered that the federal
27 tax liens of the United States upon the Property shall be foreclosed and that the Property shall be
1 Ninth Circuit on June 29, 2022 (Doc. 87), with the mandate entering on October 6, 2022. (Doc.
2 90.) The United States was ordered file a proposed order of sale as to real property belonging to
3 Defendant. (See Doc. 73 at 13; Doc. 92 at 2.)
4 On July 17, 2023, the United States filed a proposed order of sale as to the Property.
5 (Doc. 93.) On July 28, 2023, Defendant filed a motion to “permanently stay enforcement” of the
6 Court’s prior order(s) related to the sale of the Property, arguing, among other things, that his
7 medical condition(s) tip the “balance of hardships . . . sharply and heavily” against entering an
8 order of sale. (Doc. 94.) Defendant asked that the Court instead permanently stay the order of
9 sale and establish a life estate that would allow Defendant to remain in the Property for the
10 remainder of his life. (See id.)
11 On August 29, 2023, over Defendant’s “objections,” which the Court construed as a
12 motion for reconsideration brought pursuant to Federal Rule of Civil Procedure 60, the Court
13 entered an order of sale. Therein, the Court explained:
14 Under 26 U.S.C. § 7403, a district court “may decree a sale” of a
property subject to a lien of the United States. This power to order
15 the “sale of certain properties to satisfy the tax indebtedness of
delinquent taxpayers” extends to “the sale of the family home in
16 which a delinquent taxpayer had an interest at the time he incurred
his indebtedness.” United States v. Rodgers, 461 U.S. 677, 680
17 (1983). As the Court’s summary judgment order explained, (Doc.
73 at 7), under § 7403, this Court has “limited equitable discretion
18 in determining whether to order the sale of property to satisfy
delinquent tax liabilities.” United States v. Gibson, 817 F.2d 1406,
19 1407 (9th Cir. 1987). “District courts may exercise this limited
discretion in individual cases to take into account both the
20 government’s interest in prompt and certain collection of
delinquent taxes and the possibility that innocent third parties will
21 be unduly harmed by that effort.” Id. A district court's “limited
discretion accorded by § 7403 should be exercised rigorously and
22 sparingly.” Rodgers, 461 U.S. at 711. Critically, the Supreme
Court noted that there are “virtually no circumstances . . . in which
23 it would be permissible to refuse to authorize a sale simply to
protect the interests of the delinquent taxpayer himself or herself.”
24 Rodgers, 461 U.S. at 709; see also United States v. Nichols, No.
2:13-CV-0167-TOR, 2015 WL 7784878, at *1 (E.D. Wash. Nov.
25 6, 2015) (granting order of sale where there was no evidence of
harm to third parties even though taxpayers argued they were in
26 their late sixties, retired, and had health issues). Though Defendant
indicates his parents helped him purchase the Property and created
27 a living trust designed to benefit Defendant (Doc. 94), he points to
been unable to locate a single case that has stayed an order of sale
1 under even remotely similar circumstances, and certainly not one
that authorizes the Court to create a life estate benefitting
2 Defendant in a property subject to a federal tax lien.
3 The tax liability has already been decided, appealed, and reduced
to judgment in this case, and Defendant has articulated no legal
4 basis for the Court to decline to issue an order of sale.
Accordingly, the United States is entitled to enforce its federal tax
5 liens against the Subject Property under 26 U.S.C. § 7403, sell the
Property, and apply the proceeds toward the federal income tax
6 liabilities of the defendant.
7 || (Doc. 97 at 4-6 (footnote omitted).)
8 On September 6, 2023, Defendant filed a motion for reconsideration. (Doc. 98.) The
9 || United States opposed. (Doc. 99.) Once again, Defendant’s motion for reconsideration offers no
10 || legal basis upon which the Court may create a life estate. Indeed, the Court’s own considerable
11 || independent legal research on the subject revealed no such legal authority. To be blunt, nothing
12 || has changed. This Court is without the authority to do as Plaintiff requests. The motion for
13 || reconsideration is therefore DENIED.
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15 IT IS SO ORDERED.
16 Dated: _ September 21, 2023
TED STATES DISTRICT JUDGE
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