Exmoor Country Club v. United States, 7498.
| Decision Date | 30 April 1941 |
| Docket Number | No. 7498.,7498. |
| Parties | EXMOOR COUNTRY CLUB v. UNITED STATES. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Samuel O. Clark, Jr., Asst. Atty. Gen., and J. P. Wenchel and Hubert L. Will, both of Washington, D. C., for appellant.
Frank H. Towner, of Chicago, Ill., for appellee.
Before EVANS and KERNER, Circuit Judges, and LINDLEY, District Judge.
The United States imposed a tax upon the appellee, Exmoor Country Club. Appellee paid the tax and filed a refund claim, which the Commissioner of Internal Revenue rejected, and appellee brought this action to recover the tax. The District Court, trying the case without a jury, found the issues for appellee and entered judgment against the appellant for $2874.09. The correctness of the judgment as to $1426.34 is not disputed. To reverse the judgment as to the balance of the judgment, the United States has appealed. The taxing statute, Revenue Act of 1926, c. 27, 44 Stat. 9, § 500(a) (1), as amended by the Revenue Act of 1932, c. 209, § 711(a), 47 Stat. 169, 26 U.S.C.A. Int.Rev.Acts, page 270, imposes a tax of 1 cent for each 10 cents or fraction thereof of the amount paid for admission to any place, * * * to be paid by the person paying for such admission * * *.
Appellee maintains a private golf course and a club house and operates a swimming pool and an ice skating rink to which the general public has no access. It is a non-profit corporation, no part of its net profits inuring to the benefit of any private individual, except that regular members who happen to be such upon its dissolution are entitled to receive their pro rata share of its net assets.
To qualify as a member a person is required to be elected, pay a transfer fee, and during his membership to pay dues. Members are permitted to invite guests and to use appellee's facilities. For the use of the swimming pool, skating rink and for the privilege of dining and dancing it made certain charges against its members and their guests. For the period from June, 1932, to March, 1936, it collected $9,539.50 as charges for members' guests dining and dancing, $890 for use of the swimming pool, and $1,650 from those using the skating rink. It also collected $3328.50 from guests of its members as a charge for attendance at a Harvest Home dinner dance and New Year's Eve party. It also appears that, although admonished prior to their accrual that it would be liable for the taxes on the charges for admission for members' guests, appellee failed to collect such taxes.
The amount representing liability for the taxes in question was assessed against the appellee in the amount of $1,447.75. The District Court found that appellee's facilities were private, open only to qualified members in good standing and to guests of such members; that at all parties conducted by appellee no entertainment was offered or supplied other than dinner and music for dancing; that the charges against its members for their guests' use of the swimming and skating facilities of the club did not, of themselves, entitle members and guests to use such facilities, and stated his conclusions of law. He was of the opinion that such charges were not amounts paid for admission to a place within the meaning of the taxing statute.
In support of the judgment appellee urges (1) that the charges paid were for the use by guests of the swimming pool and skating rink and not for admission, (2) that its premises and activities are not open to the public and have not been carried on nor its...
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