Court Opinion

ID: 4478349
Source: CourtListenerOpinion
Date Created: 2020-01-16 21:13:01.538324+00
Date Added: 2024-06-11T15:04:24.415954
License: Public Domain

Murdock, J., dissenting: The Commissioner’s first argument that the decedent constructively received the $110,950 could be that the decedent had a right to call for and receive the cash surrender value of the September 29, 1932, contract in a lump sum. He made such a call and surrendered (terminated) that contract. He was then free apparently to do whatever he chose with the money. That would be a completed transaction for tax purposes and would result in the profit determined. It is immaterial that he chose to go into another transaction with Equitable since that appears to have been a new arrangement made at arms length. If the fact is that his words (“I hereby surrender the said policy to the Society for its cash surrender value”) do not reflect what he did and he merely called for further procedure under a valuable option given in that contract, so that there was no closed transaction for income tax purposes, that should be clearly shown by the facts. This route is complicated by the fact that the ultimate arrangement for payment was not an option under the contract at the time of the surrender on September 14, 1950. I disagree with the discussion on constructive receipt, if that must be considered. Forrester, /., agrees with this dissent.