Court Opinion

ID: 4479000
Source: CourtListenerOpinion
Date Created: 2020-01-16 21:13:24.804855+00
Date Added: 2024-06-11T15:03:33.527816
License: Public Domain

Murdock, J., dissenting: The Tax Court originally took the view in cases like this that gains on sale of sand and gravel were ordinary rather than capital gains, but the Fifth, Ninth, and Second Circuits reversed and held for capital gains. Crowell Land & Min. Corp. v. Commissioner, 242 F. 2d 864; Gowans v. Commissioner, 246 F. 2d 448; Barker v. Commissioner, 250 F. 2d 195. These decisions have been followed in Griffith v. United States, 180 F. Supp. 454; Bel v. United States, 160 F. Supp. 360; Sanders v. United States, F. Supp. - (Aug. 8, 1960); Witte v. United States, — F. Supp. - (Oct. 12, 1960). The Court of Appeals for the Fifth Circuit in the Crowell case quoted in full, with approval, my dissent in Crowell Land & Mineral Corporation, 25 T.C. 223. Subsequently, this Court decided to follow the Circuit Courts on this problem. See Robert M. Dann, 30 T.C. 499, where the Crowell reversal is cited with approval. The majority opinion starts this all over again by going back to our original position which, I think, is a great mistake. The present case is not distinguishable from the Dann case or from other of the cases cited above. The petitioner sold the material for a fixed price per unit removed. Nothing was to vary that price or the vendee’s obligation to pay it. Petitioner was in no way to benefit from the removal of the material except by the payment of a fixed price per unit. Particularly, he was not to share in any profit or income derived by the vendee from the removal of the material. It should be held on these facts and on the authority of the prior opinions that the gain here involved should be taxed at capital gains rates. Forrester, /., agrees with this dissent.