Robertson v. United States, Civ. A. No. 1558.

• Decision Date: 28 August 1950
• Docket Number: Civ. A. No. 1558.
• Citation: 93 F. Supp. 660
• Parties: ROBERTSON v. UNITED STATES.
• Court: U.S. District Court — District of Utah

93 F. Supp. 660

ROBERTSON v. UNITED STATES.

Civ. A. No. 1558.

United States District Court D. Utah.

August 28, 1950.

S. E. Blackham, Clyde D. Sandgren, Provo, Utah, for plaintiff.

Bryant H. Croft, Asst. U. S. Atty., Salt Lake City, Utah, for defendant.

RITTER, District Judge.

Findings of Fact

1. Plaintiff now is and was at all times hereinafter mentioned a resident of the State of Utah. That he is a taxpayer within the Internal Revenue District of the State of Utah.

2. The plaintiff is by profession a musician and composer, and at the present time is Professor of Music at the University of Utah. That during the year 1947 and for many years prior thereto he was similarly employed at the Brigham Young University, Provo, Utah.

3. During plaintiff's career in his profession he has composed many musical compositions, it having been his habit and custom upon the completion of one such composition to file it away and shortly thereafter commence another work. He completed a composition in the summer of 1936 and during the late summer or early fall of that year commenced work on a symphony which was to be called "Trilogy". He continued work on this latter composition in his spare time during the re-mainder of the year 1936 and through the years 1937, 1938 and 1939 and completed the work during the latter part of December, 1939. Upon completion of this work it was also filed away by the plaintiff.

4. In the year 1945 Mr. Henry H. Reichhold, an industrialist and apparently one of the important philanthropists of this country, and who was also president of the Detroit Symphony Orchestra, offered three awards of $25,000.00, $5,000.00 and $2,500.00, respectively, for the best symphonic works written by native-born composers of North, Central and South America. The purpose, terms, and conditions of the award are set forth in plaintiff's Exhibits No. 1 and 2, which by reference are made a part hereof. The broad purposes underlying the award are set forth on the title page of Exhibit No. 1 as follows:

"The belief that good music is a force which bridges the distances and differences between the people of various nations has moved us to establish a contest among the composers of the western hemisphere with the object of searching out the most meritorious new work for full symphony orchestra by a native composer of the Americas.

"It is the plan of the Reichhold Music Award Committee first to sponsor preliminary contests in each of the twenty-one Pan American countries, including Canada. The winning compositions of these national series will then be entered in the Competition for the grand prizes. The world premiere of those works receiving the grand prize is scheduled to be played by the Detroit Symphony Orchestra, conducted by Karl Krueger.

"The broad purpose underlying this contest is the furtherance of a spirit of understanding and unity among the Nations; and also to be helpful in bringing to the public the most important new music written in the Americas."

5. After announcement of the contest the plaintiff was urged to enter his composition "Trilogy" but he did not do so as the original announcement (Exhibit 1) required that "parts must accompany each score". Plaintiff had had trouble with his eyes and felt that they would not stand the strain that would be entailed in writing the parts. However, when the "Amendments to the Reichhold Music Award Contest Rules" (Exhibit 2) deleted the requirement that parts must accompany the score plaintiff decided to enter his composition and did so on or about February 18, 1946, by filing an official entry blank, a copy of which, as executed by the plaintiff is part of Plaintiff's Exhibit 1 attached hereto.

6. The composition entered by the plaintiff was selected by the award committee, set up by Mr. Reichhold, as the best composition submitted and the plaintiff was presented by Mr. Reichhold the award of $25,000.00 on December 14, 1947.

7. The plaintiff, LeRoy J. Robertson, did not produce the composition "Trilogy" for the purpose of entering it in any contest neither for the purpose of selling it to Mr. Reichhold or to anybody else nor to produce income. It was the inspiration of an artist, his desire to do this creative work and was motivated dominantly and primarily for reasons other than monetary. On the other hand, Mr. Reichhold's purpose in announcing the contest and making the awards was to "give" — not to employ or to buy or sell and the award made to the plaintiff was not in exchange for the right to capitalize on his opus. The composition remained and remains the property of the plaintiff and he merely granted to the Detroit Symphony Orchestra synchronization rights as applied to motion pictures, etc.; the right to first performance and the right to designate the publisher of the composition.

8. On or about the 5th day of February, 1948, the said plaintiff filed with the Collector of Internal Revenue for the District of Utah at Salt Lake City, Utah, an income tax return for the calendar year 1947, in which he reported total income $29,676.89, total deductions of $4,721.99, and a net income of $24,954.90. That included in gross income was the following, "Henry H. Reichhold — music award $25,000.00". That plaintiff paid the tax of $1,121.56 shown to be due on said return, as follows: $161.58 by withholding from salary and $959.98 by check dated January 15, 1948, which check was deposited by the said collector on January 22, 1948.

9. Attached to the aforesaid return of the plaintiff was the following statement; to-wit:

"In the year 1945 Mr. Henry H. Reichhold announced a contest in which he would award a prize of $25,000.00 to the person submitting the best symphonic composition to be determined by the Reichhold music award committee. The broad purpose underlying this contest, in the words of the donor, `is the furtherance of a spirit of understanding and unity among the nations; and also to be helpful in bringing to the public the most important new music written in America.'

"The taxpayer, LeRoy J. Robertson during the years 1936, 1937, 1938 and 1939 had worked on the composition of a symphony entitled `Trilogy' and had completed it in the latter part of December, 1939. This composition was entered in the contest by the taxpayer, was selected by the award committee as the best composition submitted and the taxpayer was presented by Mr. Reichhold the award of $25,000.00 on December 14, 1947.

"The taxpayer has submitted the facts in connection with this award to the Commissioner of Internal Revenue for a ruling as to the taxability thereof, and by letter dated January 8, 1948, the said Commissioner ruled that the entire award was taxable.

"The taxpayer believes that the Commissioner's ruling is in error on the basis of the decision of the Circuit Court of Appeals for the District of Columbia, in McDermott v. Commissioner of Internal Revenue, 80 U.S.App.D.C. 176, 150 F.2d 585, and other rulings and decisions and intends to submit the matter further to the Commissioner on claim for refund or otherwise.

"Assuming but not admitting the Commissioner's ruling to be correct, the taxpayer...