Court Opinion

ID: 4622271
Source: CourtListenerOpinion
Date Created: 2020-11-21 02:49:01.861849+00
Date Added: 2024-06-11T07:56:09.371704
License: Public Domain

Appeal of L. ORANSKY.Oransky v. CommissionerDocket No. 2061.United States Board of Tax Appeals1 B.T.A. 1239; 1925 BTA LEXIS 2596; May 26, 1925, decided Submitted May 6, 1925.  *2596 Held, that an expenditure in 1921 under the facts in this appeal is not deductible as a loss from other casualty under section 214 (a)(6) of the Revenue Act of 1921.  Walter C. Barton, Esq., for the taxpayer.  Robert A. Littleton, Esq., for the Commissioner.  MORRIS*1239  Before MARQUETTE and MORRIS.  This appeal is from the determination of a deficiency in income taxes for the year 1921 amounting to $978.28, and raises the question of the deductibility of certain expenditures made in that year.  From the pleadings and stipulation the Board makes the following FINDINGS OF FACT.  The taxpayer is a resident of the State of Iowa and his principal place of business is at Des Moines, Iowa.  On April 14, 1920, Sidney Oransky, his minor son, accidently ran down and killed Genevieve Bolender, while driving an automobile owned by the taxpayer.  At the time of the accident he was not engaged in the trade or business of the taxpayer and the automobile was not being used in connection therewith.  Under the laws of the State of Iowa the taxpayer is legally responsible for the negligent acts of his minor son.  On or about June 22, 1920, an action*2597  was instituted in the District Court of Polk County, Iowa, by Elizabeth Meyers, administratrix of the estate of Genevieve Bolender, deceased, against the taxpayer, his minor son, Sidney Oransky, O. P. Durocher, and Fred Riley, for damages against said defendants in the sum of $50,668.35, on account of alleged wrongful negligence and unlawful conduct of said defendants.  Fred Riley and O. P. Durocher were made parties defendant to the suit for the alleged reason that at the time of the accident Fred Riley, with the consent and acquiescence of O. P. Durocher, was negligently driving an automobile owned by the latter, abreast of and in close proximity to the automobile being driven by the taxpayer's minor son.  The taxpayer was insured by the Southern Surety Company, under a policy containing public liability coverage in the amount of $10,000.  Upon the advice of counsel the case was settled out of court for $6,650,000.  The insurance company disclaimed liability under the policy, but compromised with the taxpayer and paid $3,000, and the taxpayer paid the balance, namely, $3,650, to the administratrix of the estate of Genevieve Bolender, deceased.  In addition to this amount the taxpayer*2598  paid $38.10 as costs and $1,975,65 as attorney's fees in connection with said suit.  *1240  Said payments aggregating $5,663.75 were made by the taxpayer in 1921 and he took a deduction for that amount in his incometax return for the calendar year 1921, claiming the same as a loss from other casualty.  The Commissioner disallowed said deduction and determined the deficiency hereinabove stated, from which the taxpayer takes this appeal.  DECISION.  The determination of the Commissioner is approved.  OPINION.  MORRIS: In the , we held that the rule of ejusdem generis is applicable in the construction of the words "other casualty" as used in section 214(a)(6) of the Revenue Act of 1918.  As the taxpayer is claiming a deduction in this appeal under an identical provision of the Revenue Act of 1921, and the casualty was not of a character similar to a fire, storm, or a shipwreck, that decision is controlling in this appeal.