Elmhurst Cemetery Co of Joliet v. Commissioner of Internal Revenue
| Decision Date | 01 February 1937 |
| Docket Number | No. 255,255 |
| Citation | 300 U.S. 37,81 L.Ed. 491,57 S.Ct. 324 |
| Parties | ELMHURST CEMETERY CO. OF JOLIET v. COMMISSIONER OF INTERNAL REVENUE |
| Court | U.S. Supreme Court |
Mr. Elden McFarland, of Washington, D.C., for petitioner.
Mr. Thurman Arnold, of New Haven, Conn., for respondent.
Petitioner, in 1909, purchased one hundred and thirty-seven acres of land near Joliet, Ill., for $60,000. Thirty-seven acres were divided into plots and developed for cemetery purposes by grading, constructing drives, planting shrubbery, etc., at a cost of $35,000. Grave plots, varying in area from 150 to 1,500 square feet, were sold from time to time under contracts for perpetual care.
Some 36,000 square feet were disposed of during the years 1909 to 1913 at prices ranging from 70.2 cents to 79.5 cents. The average between March 1, 1912, and March 1, 1913, was 76.6 cents. In the three years 1926, 1927, and 1928, 42,000 square feet were sold for $1.55 to $1.77. To determine the taxable gains realized from the latter sales, it became necessary to ascertain the value of the lots as of March 1, 1913. The petitioner's return estimated this at 76.6 cents. The Commissioner adopted 23.96 cents and assessed deficiencies accordingly.
Upon petition for redetermination the Board of Tax Appeals, after considering the evidence, approved the 76.6 cents valuation and found no deficiencies. The evidence consisted of a stipulation by counsel concerning sales in 1909 to 1913 as detailed above, and the testimony of the cemetery superintendent.
He stated the original cost of the one hundred and thirty-seven acres, expense of development, area sold in 1926, 1927, 1928, and prices obtained. He affirmed familiarity with the property on March 1, 1913, prices then prevailing, and stated that the sales of 1912 and 1913 were in normal course without extra effort. Also that 'the purchase price was established by my visiting a good many cemeteries that I figured were practically of the same class as that cemetery and situated near cities of about the same population, and I established a price from the price they were selling at.' Further that 'every grave and lot in the cemetery sold since its organization is under perpetual care, and when perpetual care is provided, it means keeping the roads and drives in proper repair, keeping the drainage system in propoer repair, keeping the fences in repair, cutting the grass, pruning the trees, shrubs, and keeping it in good condition.' He thought it might take seventy-five years to dispose of all lots.
The Board declared 'the parties are now concerned only with the value as of March 1, 1913, of that thirty-seven acres of petitioner...
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