Court Opinion

ID: 8594750
Source: CourtListenerOpinion
Date Created: 2022-11-23 16:01:49.159076+00
Date Added: 2024-06-11T16:54:50.427489
License: Public Domain

Nichols, Judge,
concurring:
I join in the decision of the court but I question its approach to the problem before it. "When the United States Supreme Court elects to take a case on certiorari, receives briefs, hears oral argument, and puts out a decision including a signed opinion, it seems to me it is entitled to expect that •it has created a precedent that lower Federal courts will follow over a wide area. Diligence by them in reducing the authority of such a holding to its own peculiar facts, is hardly to be reconciled with the place of the Supreme Court in our judicial system.
Here we have a decision, Raybestos-Manhattan, Inc. v. United States, 296 U.S. 60 (1935). The Court does not quote the laws of New Jersey, as it does the applicable Revenue Act. Neither does the more extended opinion below, 80 Ct. Cl. 809, 10 F. Supp. 130 (1935). In holding that the stamp tax liability attached to the “vicarious” transfer of the new corporation’s stock from the old corporations to the stockholders, I am sure it expected its decision to apply as a prece*124dent to reorganizations and mergers throughout the United States. Presumably it subscribed to the idea that Federal taxes should be uniform everywhere. Had it anticipated and meant to sanction a hair splitting analysis of differences between the laws of New Jersey, and of other states, with respect to the procedural details of reorganizations and mergers, with results determinative of tax liability, it might very well have thrown in the sponge and held the other way. The decision rests on a fiction, in that new stock which by agreement was to go direct to the stockholders, is imagined or presumed to go to them via the old corporations. Whether the fiction is not permitted to be a fact under local law, or is just not the agreement of the parties, appears to me to be neither here nor there.
Union Bankers Ins. Co. v. United States, 317 F. 2d 598 (5th Cir., 1963), is the case that should be reduced as a precedent to its own peculiar facts. The incapacity of the old corporation to receive the stock of the continuing corporation in that case was due to a prohibition in Texas law, on substantive grounds. In fn. 16, Chief Judge Brown limits his holding to such a case. If we exclude it from application here, we do only what he has first done for us. The alleged strictures of Ohio law were procedural only.
My concurrence in the decision, therefor, does not depend on who is right about the Ohio cases. I would apply Bay-bestos uniformly in all 50 states, in the absence of special factors which we coidd pass upon should they arise.