Court Opinion

ID: 4482685
Source: CourtListenerOpinion
Date Created: 2020-01-16 21:15:38.034602+00
Date Added: 2024-06-11T14:19:47.604488
License: Public Domain

Dawson, J., dissenting: Yes, Chicken Little,1 the skjr is falling! The majority of this Court has just declared that the “building” in which you live will no longer be called the “henhouse.” Henceforth it will be known as “other tangible property” so that your two-legged, unfeathered friends might reap the benefits of an investment credit. I know it must be as much of a psychological shock to you as it is to me, for my rural heritage always taught me that a “henhouse” is really and truly a “building.” It has the unmistakable look of a building. It is not unlike “barns,” housing cows and horses, which are treated as “buildings” under section 1.48-1 (e) (1), Income Tax Regs. The majority has arrived at its conclusion that petitioners’ hen-houses were not buildings by discounting the human activity that took place inside the houses. It discounts the activity because of the nature and quantity thereof. The nature of the activity is characterized as “the maintenance and collection of goods, a typical activity in any facility that serves merely as a storage area or processing chamber.” The quantity of the .activity is described as that which would occupy one person for 6 hours per day. To my mind the maintenance and collection of goods is comparable to what went on in the greenhouses in Sunnyside Nurseries, 59 T.C. 113 (1972), and Arne Thirup, 59 T.C. 122 (1972), on appeal (C.A. 9, May 14, 1973). The majority herein does not challenge the correctness of these decisions, but distinguishes them on the ground that there the structures involved provided “working space where a substantial number of persons were frequently and regularly occupied.” To be sure, there was less human activity in petitioners’ henhouses than took place in the greenhouses, but in my judgment there was sufficient work performed by human beings in the henhouses so as to require the same result. The activity here was conducted on a daily basis, it was indispensable to the operation, and it was substantial. To properly care for the poultry it was necessary for people to provide feed, grit, water, temperature and lighting control, egg collecting (14,000 each day), and the removal of droppings and dead chickens. Frankly, I do not see how this degree of human activity can be discounted in the way it lias been by the majority. There was as much, and probably more, human activity in these henhouses2 than there is in any barn, which is plainly a “building” within the meaning of the statute. It seems to me that the majority has erroneously applied settled law to the facts of this case. I would sustain the respondent herein and hold that the structures do not qualify for the investment credit. See Robert E. Catron, 50 T.C. 306, 315 (1968), and Palmer Olson, T.C. Memo. 1970-296, which approved in dicta as “reasonable and sound” the respondent’s statement in Rev. Rul. 66-89, 1966-1 C.B. 7, that poultry houses are “buildings.” Eatjm and Duennen, JJ., agree with this dissent.   Classic English folk tale. See the modern version, “Henny Penny” by Paul Galdone, The Seabury Press, New York (1968).    The majority’s reference to the so-called clarification in a Senate committee report relating to an automated structure for raising hogs is misleading. The committee obviously was of the impression, whether rightly or wrongly, that the structure did not involve any human activity of consequence — a situation different from that in the present 'case — and was more to be compared to such structures as blast furnaces, brickkilns, etc., which are not treated as “buildings.” The facts herein call for the opposite conclusion.