278 U.S. 55 (1928), 46, United States v. Cambridge Loan & Building Co.

Docket Nº:No. 46
Citation:278 U.S. 55, 49 S.Ct. 39, 73 L.Ed. 180
Party Name:United States v. Cambridge Loan & Building Co.
Case Date:November 19, 1928
Court:United States Supreme Court

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278 U.S. 55 (1928)

49 S.Ct. 39, 73 L.Ed. 180

United States


Cambridge Loan & Building Co.

No. 46

United States Supreme Court

Nov. 19, 1928

Argued October 23, 24, 1928



1. A corporation which, by the law of its state, is a building and loan association, and the business of which is conducted in accordance with that law, is a "building and loan association" within the

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meaning of §§ 231 of the Revenue Acts of 1918 and 1921, granting exemption from income tax if its operations be not so related to mere moneymaking as to constitute a gross abuse of the name. P. 57.

2. The activities of the respondent in the way of receiving deposits on interest and making loans to persons not among its members (borrowers being required since the Act of 1921, supra, to purchase from one to five shares of its stock) did not disqualify it for the tax exemption. Id.

3. The Act of 1921, supra, in confining the exemption to building and loan associations "substantially all of the business of which is confined to making loan to members," did not limit loans to the amount of shares subscribed for. P. 59.

4. An Act directing that certain taxes be refunded as "illegally collected" is an interpretation of the prior Act under which they were exacted, and, by implication, approves decisions of the federal courts holding the exaction unwarranted. P. 58.

61 Ct.Cls. 631 affirmed.

Certiorari, 276 U.S. 614, to a judgment allowing recovery on a claim for money paid under duress as income taxes.

HOLMES, J., lead opinion

MR. JUSTICE HOLMES delivered the opinion of the Court.

This is a suit brought by the respondent to recover the amount of taxes for the years 1918 through 1923, paid under duress, from which it says that it was exempt by the Acts under which the taxes were levied. It recovered

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in the Court of Claims, and a writ of certiorari was granted by this Court, April 9, 1928.

The respondent is incorporated under the laws of Ohio, by which it is recognized as a building and loan association, and it has conducted its business in accordance with the laws of that state. The Revenue Act of 1918, February 24, 1919, c. 18, § 231, 40 Stat. 1057, 1076, exempts from the taxes is question

(4) Domestic building and loan associations and cooperative banks without capital stock...

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