Court Opinion

ID: 4498580
Source: CourtListenerOpinion
Date Created: 2020-01-23 18:16:01.47338+00
Date Added: 2024-06-11T15:04:06.201853
License: Public Domain

Opper,
dissenting: What seems to me to be the significant factor here is that whatever condition may have attached to the transaction in the beginning had disappeared before the taxable year came to an *471end. Without suggesting that it would necessarily be, otherwise if the significant events had been attributable to various years, on this record it can not be disputed that the entire transaction from inception to termination occurred between February 5 and December 28, all in the tax year 1986; so that when the sums were paid which petitioner seeks to have treated as interest, they were unconditionally interest and everybody concerned knew and recognized them to be such. It is difficult to understand why the Commissioner and the Board must disregard as inconsequential what every participant must have realized was of the essence: The fact, as my Brother Disney demonstrates, that when the transaction with which we are concerned was closed, petitioners had received income in the form of dividends and had paid out something which was nothing if it was not interest—a sum paid for the forbearance of money due. When it was paid, even the most scrupulous regard for the legal niceties could not conceal that there was an “indebtedness.” At least when this is so clear, and while the tax liability for the very year under consideration remains in a fluid state, there seems less than an impelling urgency for so flagrant a disregard of actuality, Rotorite Corporation (C. C. A., 7th Cir.), 117 Fed. (2d) 245.