145 C. Cls. Opinion of the Court Mr. Murray M. Chotiner for the plaintiff. Mr. George L. Ware, with whom was Mr. Assistant Attorney General George Cochran Doub, for the defendant. JONES, Chief Judge, delivered the opinion of the court: The plaintiff seeks to recover the face value of ninety-five postal money orders now in the plaintiff's possession. The case is before us on defendant's motion for judgment on the pleadings. The defendant contends that this court has no jurisdiction over the controversy and, in the alternative, that the petition fails to state a cause of action. The plaintiff, in 1953, while residing in Manila, Philippine Islands, acquired for value, ninety-five postal money orders issued by the United States Post Office Department and governed by 39 U.S.C. §§ 711, 723, 724, 728 (a).1 On the back of each money order was a printed statement to the effect that in order to transfer the instrument a special indorsement by the payee was necessary. Both the statute and the order 1" 711. Money-order system established. "To promote public convenience, and to insure greater security in the transfer of money through the mail, the Postmaster General may establish and maintain, under such rules and regulations as he may deem expedient, a uniform money-order system, at all suitable post offices, which shall be designated as 'money-order offices.' "The payee of a money order may, by his written indorsement thereon, direct it to be paid to any other person, and the postmaster on whom it is drawn shall pay the same to the person thus designated, provided he shall furnish such proof as the Postmaster General may prescribe that the indorsement is genuine, and that he is the person empowered to receive payment; but more than one indorsement shall render an order invalid and not payable, and the holder, to obtain payment, must apply in writing to the Postmaster General for a new order in lieu thereof, returning the original order, and making such proof of the genuineness of the indorsements as the Postmaster General may require. "§ 724. Identification of payee. "Postmasters shall not issue any money order conditioned that identification of payee, indorsee, or attorney may be waived, nor shall any postmaster pay any money order issued without requiring identification of the payee, indorsee, or attorney. "§ 728(a). Payment; unpaid orders after lapse of twenty years. "No money order heretofore or hereafter issued shall be paid after twenty years from the last day of the month of original issue. Claims for unpaid money orders shall be forever barred unless received by the Post Office Department within such twenty-year period. Any excess of funds accrued because of money orders remaining unpaid may be transferred to postal revenues at such times and in such amounts as the Postmaster General shall determine. The records of the Post Office Department shall serve as the basis for adjudicating claims for payment of money orders." 249 Opinion of the Court further stated that an additional indorsement would render the instrument void. All ninety-five postal money orders involved in this case bear a second indorsement. The plaintiff is unable to locate or identify any of the original payees or remitters named in the money orders. The plaintiff presented the money orders to the United States Post Office Department for payment of their face value totaling $8,344. The Postmaster General refused payment until such time as the plaintiff should produce evidence that the indorsements were genuine and that the plaintiff was the owner of the orders. The plaintiff contends that he acquired possession of the money orders for value received and that the second indorsements on the instruments were made through a misunderstanding. The plaintiff further asserts that the Postmaster General's refusal to pay the money orders without a hearing constituted arbitrary and capricious action, thus giving this court jurisdiction to review the decision of the Postmaster General. The instruments involved in this case are not "negotiable instruments" and are not therefore governed by the laws applicable to commercial paper. They are specialties called "money orders" and are governed by the postal laws. In order for the plaintiff to receive payment he must comply with the procedure required by those laws. In order to obtain payment on these money orders he must "make proof of the genuineness of the indorsements as the Postmaster General may require." The mere fact that the plaintiff is a holder for value is not sufficient. The issue is whether the plaintiff has complied with the statutory requirements. We hold that he has not met these requirements and that in refusing payment, the Postmaster General acted neither arbitrarily nor capriciously. The question before the Postmaster General was entirely one of fact. The evidence presented at that time by the plaintiff was not sufficient to satisfy the Postmaster General that the indorsements were genuine, nor was he satisfied with the chain of title. According to the statutory provisions it is within the discretion of the Postmaster General to Syllabus 145 C. Cls. authorize the payment of the money orders provided the holder "shall furnish such proof as the Postmaster General may prescribe that the indorsement is genuine, and that he is the person empowered to receive payment; ***." Absent any arbitrary action, his decision is final and this court will not upset it. The plaintiff, according to the statutory provision, is not left without a remedy should he be able at some later time to prove ownership of the orders since he has twenty years after the date of issue to make a proper claim against the defendant. Defendant's motion for judgment on the pleadings is granted, and plaintiff's petition will be dismissed. It is so ordered. LARAMORE, Judge; MADDEN, Judge; and WHITAKER, Judge, concur. STEWART P. VERCKLER, AS EXECUTOR OF THE ESTATE OF MARGARET STEWART VERCKLER v. THE UNITED STATES [No. 361-57. Decided March 4, 1959] ON PLAINTIFF'S AND DEFENDANT'S MOTIONS FOR SUMMARY JUDGMENT Taxes, estate; claims for refund; limitation of actions.—In an action to recover estate tax under a 1956 amendment to the Internal Revenue Code of 1939 which made tax relief available to the estates of decedents dying after December 31, 1951, where property had previously been taxed to the estate of decedent's spouse who had died within two years before the decedent's death, it is held that the plaintiff met the provisions of the relief statute and was entitled to recover even though claim for refund was made more than three years after payment of the tax, since the prior collection of tax was not illegal, erroneous or excessive until the approval of the retroactive amendment and plaintiff had no basis for filing a claim until such time. The three-year statute of limitation for filing claims for refund of estate tax did not begin to run until the approval of the amendment to the Code and plaintiff's claim was filed within such time. Section 910, Internal Revenue Code of 1939. Internal Revenue 2025 Limitation of Actions → 49(4) 252 Opinion of the Court Taxes, estate; claims for refund-timely filing.-Timely filing of claim for refund of tax is a procedural prerequisite to the bringing of a suit to recover tax paid. Internal Revenue 2025 Taxes, estate; claims for refund-contingent claims.-No authority exists for the filing of contingent claims for refund based upon the possible future action of Congress in passing remedial legislation. Such a claim would not be based upon the grounds that there had been an erroneous or illegal collection of tax as required by section 910 of the Internal Revenue Code of 1939. Internal Revenue 2026 Statutes; construction and operation; remedial legislation.-Legislation intended to relieve persons of hardship should be construed liberally in favor of those who are the law's intended beneficiaries. Taxes, estate; claims for refund; limitation of actions; constructive payment. Where a retroactive amendment of the Internal Revenue Code provides for the refund of what had previously been a legally collected tax, the act creates a constructive payment of an illegally collected tax as of the time of the approval of the amendment and the limitation period for the filling of claims for refund begins as of that time. Mr. Graham Loving for the plaintiff. Mr. L. Karlton Mosteller and Messrs. Mosteller, Fellers, Andrews & Loving were on the briefs. Mr. Jack F. Blair, with whom was Mr. Assistant Attorney General Charles K. Rice, for the defendant. LARAMORE, Judge, delivered the opinion of the court: This is a suit for the refund of $20,863.74 in estate tax paid by the plaintiff as executor of the estate of Margaret Stewart Verckler. Claim is made under the provisions of Public Law 417, 84th Congress, 2d Session, 70 Stat. 26, approved February 20, 1956, retroactively amending the Internal Revenue Code of 1939 by adding new section 814, which provided in pertinent part as follows: *** If the executor so elects, the tax imposed by sections 810 and 935 in the case of a decedent (but only if the decedent was a citizen or resident of the United States at the time of his death) dying after December 31, 1951, shall be credited with all or a part of the amount * Opinion of the Court 145 C. Cls. of the Federal estate tax paid with respect to the trans- son The remaining portions of the act deal with the method of computing the credit and a provision that no interest shall be allowed in case of refund resulting from relief under the act. The uncontroverted facts in this case show that the decedent Margaret Stewart Verckler died on February 25, 1952, which was within two years of the death of her lawful spouse. On May 21, 1953, an estate tax return was filed together with payment of $175,858.74 as shown due by that return. On April 23, 1956, a deficiency assessment was made against the estate in the amount of $2,194.65 together with interest. This deficiency assessment was paid in full on April 27, 1956. On September 19, 1956, plaintiff filed a claim for refund of estate taxes in the amount of $23,058.39 alleging entitlement to the provisions of P.L. 417, supra, because that sum represented estate tax paid on property previously taxed to the estate of decedent's husband. The Commissioner of Internal Revenue allowed plaintiff's claim to the extent of $2,194.65 which was equal to the deficiency payment, less interest, made on April 27, 1956, but denied refund for the remaining $20,863.74 for which plaintiff has instituted this suit. Both parties have moved the court for summary judgment stating that there is no issue as to any material fact and that they are entitled to judgment as a matter of law. The Government's sole defense to this action is that the claim is now barred by the applicable statute of limitations. This arises in the following manner: Section 7422 (a) of the Internal Revenue Code of 1954 provides: No suit or proceeding shall be maintained in any court for the recovery of any internal revenue tax alleged to have been erroneously or illegally assessed or collected or of any sum alleged to have been excessive or in any manner wrongfully collected until a claim for refund or credit has been duly filed with the Secretary or his |