Commissioner of Internal Revenue v. Halliwell, 60.
| Decision Date | 01 December 1942 |
| Docket Number | No. 60.,60. |
| Citation | 131 F.2d 642 |
| Parties | COMMISSIONER OF INTERNAL REVENUE v. HALLIWELL. |
| Court | U.S. Court of Appeals — Second Circuit |
Samuel O. Clark, Jr., Asst. Atty. Gen., and Sewall Key and L. W. Post, Sp. Assts. to the Atty. Gen., for petitioner.
Theodore B. Benson, of Washington, D. C., for respondent.
Before SWAN, AUGUSTUS N. HAND, and CHASE, Circuit Judges.
The question presented is whether the taxpayer realized taxable gain on the transfer of certain securities, pursuant to a decree of divorce, to his former wife. The tax court answered this question in the negative, 44 B.T.A. 740, following its own prior decision in Mesta v. Commissioner, 42 B.T.A. 933, which was subsequently reversed by the Third Circuit. Commissioner v. Mesta, 123 F.2d 986.
The facts are undisputed. In March 1938 the taxpayer's wife commenced an action for divorce in the Superior Court for Litchfield County, Connecticut. During the pendency of the action the husband and wife agreed, subject to approval by the court, that in the event of divorce she should have custody of their minor child and he would pay her as alimony and for support of the child "a lump sum, consisting of the securities and cash specified and described" in the agreement. On the date of execution of the agreement the wife also executed a release of all rights to share in the husband's estate upon his death. Thereafter a decree was entered awarding the wife an absolute divorce and custody of the child. The decree also contained findings that the husband's property had an approximate value of $1,500,000 and that "Securities and cash of the approximate value of $462,561. are a reasonable portion of the defendant's estate to be assigned to the plaintiff as provided by and in compliance with the terms of the agreement aforesaid"; and it directed the husband to transfer to the wife "as alimony and in full of his obligation for the support of said minor child," the specified securities and cash, "or substitutes therefor," and adjudged that upon delivery of the securities and cash the husband should be "discharged of all past or future obligations for the support of" the wife and child. At the date of their delivery the specified securities were worth $461,887.62; their cost to the petitioner was $160,038.97.
In all essential respects the case is the same as Commissioner v. Mesta, 3 Cir., 123 F.2d 986. With that decision we agree. The taxpayer attempts to distinguish it because in Pennsylvania a wife cannot be awarded alimony on obtaining an absolute divorce while in Connecticut she may. Conn.Gen.Stat.1930, rev. § 5182. Hence it is argued that in the Mesta case the wife's right to the stock transferred by her husband rested solely on the contract between them, while in the case at bar the...
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Old Colony Trust Co. v. Commissioner of Corporations and Taxation
...for which the release was exchanged); Commissioner of Int. Rev. v. Mesta, 123 F.2d 986, 988 (3d Cir.); Commissioner of Int. Rev. v. Halliwell, 131 F.2d 642, 643 (2d Cir.); Beveridge, 10 T.C. 915, 918; Estate of Friedman, 40 T.C. 714, 720.6 We recognize, of course, that in dealing with Massa......
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...transferred by a husband to his former spouse. Commissioner v. Mesta, 123 F.2d 986 (C.A. 3d) (Pennsylvania); Commissioner v. Halliwell, 131 F.2d 642 (C.A. 2d) (Connecticut); Hall v. Commissioner, 9 T.C. 53 (Florida); Patino v. Commissioner, 13 T.C. 816 (New York); Estate of Stouffer v. Comm......
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Cook v. Comm'r of Internal Revenue , Docket No. 6463-80.
...Mesta v. Commissioner, 42 B.T.A. 933 (1940), revd. 123 F.2d 986 (3d Cir. 1941); Halliwell v. Commissioner, 44 B.T.A. 740 (1941), revd. 131 F.2d 642 (2d Cir. 1942), cert. denied 319 U.S. 741 (1943); Commissioner v. Marshman, 279 F.2d 27 (6th Cir. 1960), revg. 31 T.C. 269 (1958). The Supreme ......
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