Court Opinion

ID: 4484084
Source: CourtListenerOpinion
Date Created: 2020-01-16 21:16:30.18814+00
Date Added: 2024-06-11T14:54:03.984117
License: Public Domain

Goffe, J., dissenting: I respectfully dissent. This case was reviewed by the Court at the same time it reviewed Popa v. Commissioner, 73 T.C. 130 (1979). I cannot agree with the majority that the instant case is so distinguishable from Popa to require a contrary result. In Popa, we held that the loss of property located in Saigon at the time Saigon fell into the hands of the invading North Vietnamese was a casualty loss. In the instant case the majority applies a “smell test” to deny a casualty loss deduction for the sudden worthlessness of South Vietnamese currency occasioned by the identical occurrence; the fall of the South Vietnamese Government to the invading North Vietnamese. A concurring opinion attempts to reconcile the two opinions by pointing out that the South Vietnamese piasters became worthless by reason of governmental action of the North Vietnamese in outlawing them. The record in the case contains no evidence nor did the Court take judicial notice of any action on the part of the North Vietnamese Government to outlaw the South Vietnamese piasters; nor does respondent request such a finding of fact. Respondent concedes that the piasters became worthless and concedes that petitioners sustained a loss but argues that the piasters were confiscated by the government. This argument is contrary to the facts; i.e., the majority finds as a fact that petitioners are still in possession of the piasters. The sole question presented is whether the loss sustained by petitioners was a casualty loss encompassed by the language of section 165(c)(3). The majority points out that Congress enacted legislation with respect to losses sustained in Cuba when Fidel Castro seized control of the government. Such an argument should apply with equal force in Popa, as pointed out in a dissenting opinion in that case. I fail to see a distinction between a loss sustained as a result of a civil revolution and one resulting from invasion by enemy forces. The applicable language of section 165(c)(3) is “fire, storm, shipwreck, or other casualty.” The majority, in applying its “smell test” relies upon the principle of statutory construction traditionally applied to this issue, ejusdem generis. The test has been applied in a host of cases, and the courts have found a loss to constitute a casualty loss in many factual situations. E.g, damage to residence from blasting operations in a nearby quarry, Durden v. Commissioner, 3 T.C. 1 (1944); loss by vandalism, Davis v. Commissioner, 34 T.C. 586 (1960); damage from landslide, Heyn v. Commissioner, 46 T.C. 302 (1966). In my view the loss sustained by petitioners when their South Vietnamese piasters became worthless was sudden and cataclysmic and should entitle petitioners to a deduction for a casualty loss.