Court Opinion

ID: 4480260
Source: CourtListenerOpinion
Date Created: 2020-01-16 21:14:10.732616+00
Date Added: 2024-06-11T14:53:59.195194
License: Public Domain

Mulroney, J., dissenting: I respectfully dissent. The unquestioned acceptance of the definition of “fair market value,” announced in the majority opinion, as being the price at which a sale would take place between a willing seller and buyer, makes the definition an established principle which should not be lightly disregarded. If this definition means anything it must prevent or put an end to any dispute over fair market value of pieces of tangible property when there was a voluntary sale of the very pieces of property at or about the exact time of inquiry. If the definition is to be applied, then surely the sale price must be considered the fair market value unless it be that the sale was not voluntary or either the seller or buyer was not “willing.” The sale here was certainly voluntary. It was not a forced sale such as the bankruptcy sale involved in Cassidy Company, Inc., 11 B.T.A. 190, or the sheriff’s sale involved in Park Amusement Co., 15 B.T.A. 106, relied on by the majority.1 When the circumstances of the sale were such that there were several possible purchasers and payment of the price was not induced by considerations other than the acquisition of the property purchased, we have willing buyers. I do not think it can be said the hospital was an unwilling seller merely because it preferred money instead of property. After all, that is the motivation behind most all sales. It is true that the fair market value issue is one of fact and in the cases where there is no actual buyer or seller of the tangible property involved, the judgment must rest on the hazard of speculation. In such cases resort must be made to what is little more than a sheer guess as to what might be the price in an imagined sale transaction. I do not think that in a case such as this, where we have an actual seller and purchaser of the very pieces of property, under circumstances where neither was under any obligation or hard pressed to sell or buy, this Court should depart from the certainty of the sale price and measure tax deductions by predicting price decisions that mythical buyers and sellers might make. Philip Kaplan, 43 T.C. 663. I rather think that if this were an estate tax case, the sale of a decedent’s used wearing apparel and household furniture and equipment conducted by an experienced company that had been in the business of selling such property at auction for 35 years, would fix its fair market value for that tax. I would hold that, under the circumstances presented, the sale price would set the fair market value of the donated property for the amount of charitable contribution for deduction purposes. Raum, J., agrees with this dissent.   The only other ease relied on by the majority, which involved the fair market value of tangible personal property, is Stollwerck Chocolate Co., 4 B.T.A. 467, which holds the fair market value of corporate property is measured by the price of its stock as established by an auction sale of the stock.