Court Opinion

ID: 4479216
Source: CourtListenerOpinion
Date Created: 2020-01-16 21:13:32.369431+00
Date Added: 2024-06-11T15:03:32.182241
License: Public Domain

Fat, /., dissenting: I respectfully disagree with the majority opinion of the Court that the proceeds of the loan were not used in the trade or business of Cammer within the meaning of section 166(f). The prerequisite to the deduction under section 166(f) that the borrower use the proceeds of the loan in his trade or business was, I believe, intended to prohibit a deduction where the borrower uses the funds for a purpose unrelated to his business. In the instant case the borrower was faced not only with the threat of a suit for an accounting but with the possible disruption or collapse of the business. In an effort to forestall such a chain of events, he borrowed funds which he used to purchase petitioner’s interest in the partnership. Under these circumstances I believe that the proceeds were used in the trade or business of the borrower in the ordinary and usual sense of the term. FORRESTER, J., agrees with this dissent.