*1 injured ply here. is not case do, cause This at all a where for here place nature condition appellee servant, working not the fellow the was changes during him, properly progress. work The fel- nature and condition of work part of his work here perform some are, true, remain it negligence constant. There Here the was low servant. who, charged steps different employer law But the work work. unchanging provision with, having perform, assumed to is one warning it, safely done, so non-delegable duty by delegating be present person duty was essential it as regarded a whole. provision delegated, giving warning job was the one whom was one, recognized negligence. provision negligence was made. But making provision Harper Corp. warning of Mis- In sissippi, Public Service was not v. duty enough. to warn was 170 Miss. 154 So. cited non- delegable. obligation appellant, diligent state it is said: “Our to be negligence about it was consistently aligned been those which continuous. The * * discharging was nеgligence hold master liable employer. only for acts of the foreman or those superior agent which or are official man- findWe no reversible error in the rec- agerial acts, for those judgment ord. The is affirmed. pertain which workman, duties labor to the done when en- him gaged then there in manual operative laborer, having work ref- course, erence point, to those acts labor service which be- fellow long to the details the work and not nondelegable to those duties (Emphasis by the supplied.) master.” appellant None of the cases cites are cases O’SULLIVAN RUBBER COMMIS CO. one, like this of the failure of a servant SIONER OF INTERNAL REVENUE. perform nоn-delegable duty. No. 281. brief, much of So defendant’s as is Circuit Court Second Circuit. proposition devoted to the that the work June simple, danger manifest, was and there duty was warn the of defendant to plaintiff, rejected must be not in accordance the facts and con trolling For it law. would be difficult imagine a case where warning hеre, more necessary than where the nature the work go on, work to moving coming with the bucket into and car, plaintiff out of the while the working car assembling in the materials bucket, and unable it until it was him. None of the cases de fendant cites as there was duty Simple warn are like this. in deed the only simple work was here. But it was arrangemеnts per because made to operator form it simply, an dip at the per, working car; in the men some one to dipper’s them of the coming warn going. Nor defendant firmef ground approach, that be changing cause of the conditions inherent work, rule, requiring in the defend place, ant to safe ap~ furnish does not *2 Voorhees, City Blake New York & of Voorhees, Helen H. Robin- (Peter V. D.
sоn,
Stewart, Jr.,
and
all of
B.
Samuel
City,
petitioner.
counsel), for
New York
of
Clark,
Atty. Gen.,
Jr.,
Samuel O.
Asst.
Sp.
A.
Key
Sewall
and Arthur
Armstrong^
Gen.,
Atty.
respondent.
Assts. to
for
HAND,
CHASE,
Before L.
FRANK,
Judges.
Circuit
FRANK,
Judge.
Circuit
petition
This is
review
a de-
for
of
of
Board
Tax
re-
cision
of
ported at 42 B.T.A.
found
deficiency
1935 in
company
$4,198.37
of
$1,049.59.
disputed year
was a
petitioner
In the
corpоration
process
liquida
in
dissolved
It
its
rubber
selling
sold
business
tion.
1932;
in
then it
dissolved
since
heels
business,
in
engaged
but has en
has
liquidate
rapidly
possible.
deavored to
original
price,
in
after defaults
sales
notes,
in
was reduced
payments,
bearing
payable semi-annually
interest
beginning
serial maturities
unpaid
balance of
were taken
price.
adjusted
Prior
$340,000
due
liquidation
had distributed
share,
year,
in that
per
about $7
small, it made no
being
available
amount
At
income in
least
its
distribution.
80%
interest,
derived
1935 was
outstanding
its
stock
least 50%
more than five individuals.
owned
therefore,
came,
directly
within
It
HAND,
dissenting
Judge,
Circuit
L.
company”
“personal holding
definition
part.
Act
351(b) (1)
the Revenue
Int.Rev.Acts,
U.S.C.A.
footnote,1
unless
was not
set out
“corporation”.
then
Holding
than
and other
a bank
Personal
dor section
351. Surtax on
Ҥ
incorporated
company
Companies
or trust
*«*
“(a)
States
United
State
laws of the
Territory,
“(b)
substantial
whose
As
in this
ti-
Definitions.
receipt
deposits,
is the
tle—
company
“(1)
“personal holding
a life-insurance
than
cоm-
term
per
surety company)
(A)
any corporation
at least
pany”
(other
means
than
if —
gross
corporation
exempt
income
the tax-
un-
centum
taxation
Northwest
is that dis
Corp.
contention
Utilities Securities
Petitioner’s
powers,
Helvering,
Cir., 1933,
es
it with
residual
solution left
619 and
affairs,
up
addition,
cases
but de
there
regu-
sential
сited.
winding
“corporation”
within lation
been
stroyed
status as a
consistent since
*3
intervening
the
We do not
meaning
statute.
of
the
of the
reenactments
the law
corporation require
agree
that we
puts
great
a
to it
that dissolution
accord
deference.
contexts,
Helvering
Co.,
beyond taxability.
it is
v. Wilshire
1939,
In some
Oil
308
18,
corрoration
60
U.S.
we
useful
refer to
dissolved
S.Ct.
84
a
L.Ed. 101. Since
analogies
petitioner
and
conclude
“civilly
as
Rut while
dead”.
a
remained
“corporation”,
writers
metaphors
say,
(and,
purpose
I,
some
for the
of
are valuable
1
thinking,
of
they
seq.,
et
indispensable)
Act,
aids to
the Revenue
26 U.S.C.A.
Int.Rev.Acts,
cautiously
page
seq.,
and with duе re
should be tised
et
un-
is
character; necessary
essentially
gard
rely
fictional
to their
ground
alternative
far,
suggested by
they may paralyze thought.
respondent,
petitioner
carried too
the
York,
liquidators
law
state of its or its
Under the
of New
the
an
constitute
“associa-
tion,”
creation,
corporation
by
has filed а
a
of
virtue
801(a)
Section
continue”,
(2),
Int.Rev.Acts,
“shall
page
certificate of dissolution
for
U.S.C.A.
790, is
purposes
including
corporation.
the collection
be treated
stated
as a
assets,
payment
obligations,
of
of
the
Being corporation
a
purpose
its affairs
to terminate
acts
I,
of
petitioner
is also one for the
corporate pur
are
These
business.
purpose
A,
of
Title I which
the
contemplated
poses,
as such from the birth
personal holding company surtax in issue
corporation;
years
declining
the
of
“any
here. Section 351 refers
corpora
life;
corporation
a
of
and it
tion,”
by
351(b) (4)
section
this term
strange
would
that the
be
doctrine
ful
“shall
the same meaning as when
corporate purposes, which
fillment of those
in
Title I.”
docs
sug
Petitioner
not
here,
might,
require
and did
a considerable
gest,
find,
nor can
any
justification in
time,
beyond
stretch of
is
reach of
the
language
the
for exempting it under Title
in
scope
tax
broad
Seсtion
statute
IA without also exempting it under Title
operation
351(b) (1).
going
con
I.
precedent
is not
condition
to tax li
cern
ability.
suggests
why
Petitioner
no reason
But, urges
petitioner,
the
per
the
position
should
held so
anomalous
holding
sonal
surtax was enacted to
into
it does
fit
a framework in
remedy the evil of
“incorporatеd
the
every description,
of
which business units
book,”
pocket
deliberately created to re
duration,
long
of
short
must
or
share in
personal
duce the
taxes of those who cre
society.
price
the
This is the
cost
them, and, therefore,
impose
ated
tax
the
that,
existence. To the effect
under such a
corрoration
upon
petitioner’s
in
position
statute,
corporation is
a dissolved
to be
perversion
is
the Congressional
pur
alive,
regarded as
see
v. Commis pose.
Jaffee
We
assume
Cir., 1930, 45
sioner, 2
F.2d 679.
deliberately aiming
here was
to relieve
By
13(a)
personal
section
of the Revenue Act
stockholders
from
its
Tt
taxаtion.
Int.Rev.Acts,
is, however,
page
abundantly
26 U.S.C.A.
clear that Con
upon
gress,
evil,
“every
narrowly
the net income of
correcting
levied
in
is not
corporation”,
specific
section
confined to the
U.S.
instances which sug
Tut.Rev.Acts, page 683,
remedy.
course,
gested
person
a return
“Of
C.A.
all
by “every corporation subject
companies
be made
to al
were
in
not conceived
many
organized
this title.”
22 (a)-21
legitimate
taxation under
Article
were
sin—
Regulations
;
86 shows
or
that the adminis-
Congress
business reasons but
Act
trative construction
includes has
little
made
distinction between the goats
corporations
process
sheep”.2
liquida-
enacting
very
dissоlved
sec
applied here,
being
tion.
also
52-2. This
See
article
construc-
tion
tempting
was at
sustained;
defense,
repeatedly
tion has been
foreclose the
avail-
outstanding
year
able
royalties,
derived
divi-
stock
owned,
directly
(except
interest,
annuities,
dends,
indirectly,
or for not
than
more
five
regular
dealеrs
in stock or
individuals.”
ease
securities)
gains
2 Rudiek,
from the
sale
stock
Section
and Personal
(B)
Holding
securities,
time dur-
Provisions
Company
In
ing
last
half of
year
taxable
ternal
Revenue
Code,
Vale L.J.
(1939)
per
more than
centum
value
203.
of its
requirement
Act
returns
-are
Revenue
to file such
able under section
Int.Rev.Acts,
prescribed by
Commissioner;
page
26 U.S.C.A.
Int.Rev.Acts,
54(a),
profits
26 U.S.C.A.
that the accumulation of
designation
need.
of Title 1A as a
responsive
legitimate
to a
“sur-
Means,
tax”
Ways
73d
rather
a “tax” is
on
than as
immateri-
See Committee-
704, al.
Its
Sess.,
original, designation
Report No.
was “tax”.
Cong.,
House
2nd
provisions
The Senate
system
removed the
now
of this
p. 12: “The effect
placed
found in
Title 1A
Title 1
provide
which will be
for a tax
is
automatically
separate
them
title
make
holding com-
order to
levied
“plain
gradu-
this is an additional
any necessity
proving a
pany
without
tax,
surtax,
personal-
ated income
purpose
Cf. Com-
avoiding surtaxes.”
*4
companies.”
holding
Sess.,
Committee on Fi-
Finance,
Cong.,
mittee
2nd
on
73d
nance,
Cong.,
Sess.,
Report
2d
Senate
558,
73d
sug-
Report
p.
It
Senate
No.
15.
is
'
558, p.
Finally,
No.
13.
bill,
Conference
an
that of
gestive
earlier
that
revenue
Report
Sess.,
Cong.,
Report
73d
2d
House
1928,
by
proposed
the House Committee
1385,
20,
p.
says:
No.
which
“The Senate
Ways
Means,
contained in section
on
provides
separate
amendment
for a
return
104,
substantially
with
a definition
identical
purposes
p'ersonal
this
surtax on
1934,
that it
351
Act of
but
section
companies
holding
The House
by
“As
was
the
stricken
Senate because:
on
recedes
amendment no. 45.”
definitions,
arbitrary
all
the
in the
case
under
1A has in common
the
Title
corporations
penalize
which
was to
effect
1
“surtax” under Title
that
fact
up
building
surplus
a
and to
properly
were
both are
capture
so
in order to
denominated
necessities and
recognize
fail to
tax-exempt
partially
interest
Finance,
practices.”
on
Committee
sound
applies
sharply
bonds. Title 1A
to a
limited
Sess.,
Cong.,
Report No.
1st
Senate
70th
group
taxpayers,
history
which
12;
960, p.
Ways and
cf. Committee on
require particular
scrutiny.
demonstrated
Means,
Cong.,
Sess.,
Report
1st
House
70th
if
Even
there were doubt about
the con-
2,
Having
p.
indisputable
before
us
No.
Congress’ plain language,
struction of
exactitude
351
proof from the
of Section
by
would be influenсed
the fact
that
by
itself,
reports,
reinforced
Committee
requirement
separate
return is in com-
establish'objective
Congress wished to
that
plete harmony
purpose
with the intent and
imposition
tax, we can-
criteria
Congress.
corporate motives,
not, by probing into
Cir.,
Welch,
1939,
Noteman
alleged
to relieve from
harsh-
undertake
held
a
the First Circuit
that
particular application
a
the stat-
ness
separate
required, and
return was
that
Tax
there-
The Board
ute.
subject
a failure to file would
the taxpayer
fore,
in sustaining
correct
the de-
penalty.
partly
There the court relied
ficiency
asserted
com-
taxpayer’s
faсt that the
return under
pany surtax.
inadequate
Title
was an
disclosure of
penalty,
liability
There
the facts which
establish
remains the
would
25%
1A,
by
namely,
taxpayer’s
under
virtue of section
Title
that the
U.S.
Int.Rev.Acts, page 750,
closely
to stock was
that
for failure
held and
C.A.
80%
royalties,
argues
its income
return. The Commissioner
was derived
in-
file a
terest,
prefer
penalty
applicable
is made
etc.
not to rest on that
that
this
We
since,
351(c),
peti ground,
adequate
by
1A
section
and that
if
in a
Title
disclosure
not
liable therefor because it did
return under Title 1 excuses
to file
tioner is
1A,
why
separate
company
under
personal holding
we fail to see
file the
may
by
by
inadequаte
not
an
return
Art. 351-8 of
cure
surtax
disclosure
valid, amending
regulation
86. If this
Title 1 return. We
not
is
need
Regulations
return,
petitioner had
fraudulent
decide whether
a defective
if
that
the facts
amended,
properly
escape
status was in
is sufficient
substantial
intent
penalty,
may
non-compliance.
not excuse its
in-
do
but it
be indicated
dоubt
complete
Tennis
return
Side
Club v. Commis
is effective
start
See West
limitations,
sioner, Cir.,
regu
running