Robinson v. Commissioner of Internal Revenue, 9122.
| Decision Date | 17 November 1931 |
| Docket Number | No. 9122.,9122. |
| Citation | 53 F.2d 810 |
| Parties | ROBINSON v. COMMISSIONER OF INTERNAL REVENUE. |
| Court | U.S. Court of Appeals — Eighth Circuit |
Hale Houts, of Kansas City, Mo. (Dudley Doolittle, Phil D. Morelock, Perry W. Shrader, Henry S. Conrad, L. E. Durham, and William J. Carroll, all of Kansas City, Mo., on the brief), for petitioner.
S. Dee Hanson, Sp. Asst. to Atty. Gen. (G. A. Youngquist, Asst. Atty. Gen., Sewall Key, Sp. Asst. to Atty. Gen., and C. M. Charest, Gen. Counsel, Bureau of Internal Revenue, William E. Davis, Sp. Atty., Bureau of Internal Revenue, and Paul E. Waring, Sp. Atty., Bureau of Internal Revenue, all of Washington, D. C., on the brief), for respondent.
Before STONE and VAN VALKENBURGH, Circuit Judges, and SANBORN, District Judge.
W. N. Robinson, in his income tax return for 1922, claimed a deduction of $22,254.70 for local taxes paid by him on property owned by and leased from the Robinson Hotel Realty Company by him. The Commissioner disallowed such deduction, and the Board of Tax Appeals sustained the action of the Commissioner. This is a petition for review of that order of the Board.
Several matters are argued here, but they may be reduced to two propositions. One is the rejection of certain evidence. The only assignment of error relating to rulings on the admission of evidence is "That the Board erred in rejecting certain evidence offered in proof of the case." This assignment is in violation of rules 36 (sections 1 and 6) and 11 of this court, and preserves nothing for review here.
The other proposition is, in essence, that there is no substantial evidence to support the determination of the Board. The Robinson Hotel Realty Company is a corporation wherein petitioner holds about half the capital stock and the remainder belongs to members of his immediate family, a brother and a brother-in-law. The company owned a furnished and equipped hotel at Tulsa, Okl. In 1920, petitioner leased this hotel building with its furnishings and equipment for a term of eight years at an annual rental, payable monthly, of $72,000. The lease contained no statement as to any obligation to pay taxes. The lease contained a provision, as follows: "Should the party of the second part be in need of or require additional stationary machinery or other stationary improvements, such as terrazzo and tiled floors, brick partitions or tiled partitions, etc., upon mutual agreement, the first party will have such improvements installed, and for the use of such improvements, the second party shall pay at the rate of ten per cent. per annum on the cost of such improvements as additional rental."
During the years 1920, 1921, and 1922, additional improvements, as provided in the above quotation, were made to a total cost of $47,902.10, and, in full compliance with that provision of the lease, the petitioner paid as further rental various sums in these three years totaling $8,466.85. In December, 1922, the corporation sold the entire property and thereby terminated the lease agreement. At the time of this sale, petitioner had paid all additional rentals for such added improvements up to the termination of the lease.
At the end of 1922, the company owed $26,014.80 for accrued state and county taxes on this property (as shown on the books of the company). There is confusion in the record as to the amount of these taxes and as to the amount of taxes...
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