The opinion of the court was delivered by: KALODNER
Section 811 (b) (5) of the Social Security Act, August 14, 1935, c. 531, Title VIII, 49 Stat. 639, 42 U.S.C.A. § 1011, exempts from the scope of the Act "* * * Service performed as an officer or member of the crew of a vessel documented under the laws of the United States or of any foreign country; * * *."
The issue here presented is:
Are "barge captains" employed by the plaintiff exempt from social security taxes "as an officer or member of the crew" within the exemption above stated?
The issue is raised by plaintiff's suit to recover $1,800.26, together with interest, paid to the defendant as Social Security taxes for the calendar years 1937, 1938, and 1939. The suit was instituted following the Commissioner's rejection of plaintiff's claim for refund.
The case was submitted to the court upon the pleadings, stipulation of facts, and additional testimony. A jury trial was waived.
The stipulated statement of facts, which is hereby adopted as the findings of fact of this court, in part, is as follows:
1. Plaintiff at all times herein mentioned was, and now is, a corporation duly organized and existing under the laws of the Commonwealth of Pennsylvania.
2. At all times herein mentioned plaintiff was engaged in the business of mining, shipping and selling coal.
3. During the calendar years 1937, 1938, and 1939, plaintiff owned and operated certain coal barges, each of which was non self-propelled, and was enrolled at the Port of New York under the provisions of 46 U.S.C.A. §§ 251 to 254, and duly licensed to carry on the coasting trade under 46 U.S.C.A. § 262 -- a consolidated certificate of enrollment and license pursuant to 46 U.S.C.A. § 260, having been issued for each of said barges by the Collector of Customs of the Port of New York. Attached to plaintiff's complaint, marked "Exhibit A", is a statement setting forth the barge number, official number, length, net tonnage, and date of enrollment of each of said barges.
4. During said years plaintiff employed a barge captain on each of said barges, who was in sole charge of said barge and its cargo.
5. On July 31, 1939, plaintiff filed with defendant at Philadelphia reports on Forms SS-1b and SS-1c setting forth the name of each of said barge captains, his social security number, the wages paid to him, and the period covered by said payment, together with a summary or recapitulation showing the total wages paid to said barge captains from January 1, 1937, to June 30, 1939. Copies of said reports marked "Exhibit B" are attached to plaintiff's complaint. During said period plaintiff paid its said barge captains total wages or compensation of $90,012.95.
6. On July 31, 1939, plaintiff paid to defendant the sum of $1,800.26 as the tax imposed by Title VIII, Sections 801 and 804 of the Act of Congress approved August 14, 1935, 42 U.S.C.A. §§ 1001, 1004, on said payments of $90,012.95 made to plaintiff's said employees.
7. On November 27, 1939, plaintiff filed with defendant a claim for refund of said tax of $1,800.26 paid by it as aforesaid on July 31, 1939, a copy of which claim for refund marked "Exhibit C" is attached to plaintiff's complaint. The Commissioner of Internal Revenue of the United States by a letter to plaintiff dated September 11, 1940, notified plaintiff that its said claim for refund was disallowed in full, a copy of which letter, marked "Exhibit D", is attached to plaintiff's complaint.
8. The said payment of tax of $1,800.26 cannot be adjusted under Sections 802 (b) or 805 of said Act of Congress of August 14, 1935, 42 U.S.C.A. §§ 1002 (b) and 1005.
9. During the years 1937, 1938 and 1939 the plaintiff owned and operated thirty-four barges and two tugs which it employed in transporting coal from its dock to various points in New York Harbor. The barges had no steering apparatus and were towed from place to place by the company's tugs. The trips taken by the barges were usually very short -- no trip lasting more than six hours from dock to dock in the harbor.
10. The barge captains operated the barges alone in the course of transportation and were the only persons aboard the barges at ...