Practical Pigs on the Practice
by Michael Asimow, UCLA Law School(March 1998)
Fans of the excellent series The Practice are engaged in a boaring dispute about the use of a pig as a check. In the episode aired on February 9, Eugene represented a tax protestor in a criminal case who filed a correct Massachusetts tax return but refused to pay the tax.
The client turned loose a greased pig at the Revenue Department--which got the tax people mad enough to prosecute him after they had cleaned up the mess. On the pig was written the necessary elements of a check-"pay to the order of the MA Revenue Department," the amount, and a signature. The court dismissed the case since the pig should be treated as payment, even though the state failed to catch the pig and cash it at the bank. Sow what, you ask?
I have consulted with my colleagues, negotiable instruments gurus Bill Warren and Ken Klee, to clarify this matter. Warren declared that the issue was too slippery to give an opinion, but observed that the case was in accord with the landmark English decision of Board of Inland Revenue v. Haddock. In that case, String, J. concluded that a cow bearing the words "To the London and Literary Bank, Ltd.: Pay to the Collector of Taxes, who is no gentleman, or Order, the sum of fifty-seven pounds (and may he rot)" was a negotiable instrument that could be endorsed over to any willing holder. While some may argue that Haddock is distinguishable as involving either a cow or a fish, rather than a pig, most would consider the case directly in point.
As a result, Warren noted, pigs might even be considered legal tender. He remarked, however, that some pigs he had eaten recently would not qualify.
Federal tax regulations require tax payments in the form of a check or money order, but do not seem to require that the check be written on paper. The regs do, however, allow the director to refuse to accept any personal check whenever he or she has good reason to believe that such check will not be honored upon presentment--the issue addressed below. Treas. Reg. Section 301.6311-1(a)(1)(i). As recently amended, the Code requires tax payments by "any commercially acceptable means that the Secretary deems appropriate." IRC Section 6311(a). Future regulations might, therefore, rule that payment by pig is not commercially acceptable. Our research department is working on the question of whether Massachusetts has similar regulations.
What exactly would happen if the Revenue Department had captured the elusive swine, schlepped it down to the bank, and attempted to cash it? Undoubtedly, this will be a rather time-consuming transaction. In all likelihood, the Department's agent and the pig will be ahead of me in line at the bank.
Use of the ATM machine is not recommended when cashing a pig. It might cause ham to both pig and machine.
Klee believes that the drawee bank (i.e. the taxpayer's bank) would have to honor the check unless it had something in its customer agreement to the contrary. The collecting bank (i.e. the tax department's bank) would not be required to take the check, but if it did so as a favor to the department, it would be interesting to see how the Fed deals with this item in its interbank clearing process.
Klee adds the highly relevant observation that the use of the pig as a check should not cause someone who loaned money to the taxpayer on the security of the pig to lose his priority, even if the pig bounced. Losing one's priority is referred to in the trade as being "primed," which in the case of a pig may also suggest a shortened life expectancy.
Once more, The Practice brings home the bacon. It wins high marks for an excellent and legally accurate script.