Court Opinion

ID: 4598042
Source: CourtListenerOpinion
Date Created: 2020-11-20 19:20:26.912414+00
Date Added: 2024-06-11T07:51:53.998605
License: Public Domain

APPEAL OF LODI CANNING CO.Lodi Canning Co. v. CommissionerDocket No. 2364.United States Board of Tax Appeals2 B.T.A. 708; 1925 BTA LEXIS 2285; September 30, 1925, Decided Submitted June 9, 1925.  *2285 John D. Brethauer, C.P.A., for the taxpayer.  John D. Foley, Esq., for the Commissioner.  *708  Before GRAUPNER, TRAMMELL, and PHILLIPS.  The taxpayer appeals from the determination of a deficiency of $1,205.62 in income and profits taxes for the calendar year 1919.  The deficiency arises from the disallowance of a claimed loss on a carload of canned peaches.  FINDINGS OF FACT.  1.  The taxpayer is a California corporation with its principal place of business at Lodi.  2.  On November 5, 1919, the taxpayer shipped to Birdsong Bros., of New York, 1,450 cases of peaches, in a box car designated as W.P. Car No. 18014.  A 10-day draft was drawn on the consignees at or about the time to shipment and paid by them within the time specified.  3.  Upon arrival of the car at destination in January, 1920, the consignees refused to accept delivery, claiming that the peaches were below the standard specified by the contract of purchase, and *709  demanded a settlement by arbitration.  On February 20, 1920, the board of arbitration of the Dried Fruit Association of New York rendered an award in favor of Birdsong Bros., sustaining the rejection of the peaches, *2286  and held that Birdsong Bros. were to be reimbursed for the amount paid, plus interest and other accrued charges.  4.  On March 9, 1920, Birdsong Bros., drew a sight draft against O. A. Harlan & Co., of San Jose, Calif., for $10,657.57, and forwarded with it an invoice in the same amount.  The draft and invoice were apparently directed to O. A. Harlan & Co. in error, due to the fact that O. A. Harlan was president of the taxpayer company.  The draft after being protested on March 17, 1920, for nonpayment was forwarded to the taxpayer, by which it was honored and paid by check dated March 20, 1920.  5.  The goods were turned back to the taxpayer in New York and it authorized the firm of Sandford & Timpson to dispose of them.  This firm succeeded in making final disposition of the peaches in 1921 and rendered an account to the taxpayer on March 4, 1921, showing sales of 1,447 cases in the total amount of $4,365.85.  DECISION.  The determination of the Commissioner is approved.  ARUNDELL and participating.