# Memorandum for the United States in Opposition — Dobkin v. District of Columbia > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385602_0430%3A3 ## Record - **Collection:** Supreme Court brief - **Document type:** Memorandum for the United States in Opposition - **Published:** January 1, 1965 - **Citation:** 380 U.S. 962 ## Text Iu the Supreme Court of the United States OCTOBER TERM, 1964 No. 900 KELLER & GOETZ, INC., PETITIONER Vv. UNITED STATES OF AMERICA ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CiRCUIT MEMORANDUM FOR THE UNITED STATES IN OPPOSITION Section 337(a) of the Internal Revenue Code of 1954 provides an excepiion from the rule that a cor- poration, like any other taxpayer, must recognize the gain or loss realized on the sale of property. Under this section, if “a corporation adopts a plan of com- plete liquidation” ana “within the 12-month period beginning on the date of the adoption of such plan, ali of the assets of the corporation are distributed in complete liquidation * * *,” then “no gain ov loss (1) 2 shall be recognized to such corporation from the sale or exchange by it of property within such 12-month period.” The question in this case is whether the gain real- ized by petitioner from the condemnation of its prop- erty was excluded from income under Secticn 337 (a). The condemnation of property clearly constitutes a sale for the purposes of Section 337, Hawaiian Gas Products v. Commissioner, 126 F, 2d 4, 5 (C.A. 9), certiorari denied, 317 U.S. 653; Wendell v. Commis- sioner, 326 ¥. 2d 504, 602 (C.A. 2), and it is con- ceded that petitioner executed a plan of liquidation within 12 months of the adoption of the plan. The issue here is whether the sale by condemnation of pe- titioner’s property took place after the adoption of the plan, so as to exempt the gain under Section 337 (a), or whether the condemnation sale took place before adoption of the plan, so as not to qualify for the exemption under Section 337(a). Revenue Ruling 59-108, 1959-1 Cum. Bull. 72, 74, holds that the time at which a condemnation sale takes place is to be decided on an examination of the particular condemnation statute, and that— The obligation of the condemning authority should therefore be treated as fixed upon any such taking which transfers the title to the prop- erty and creates an immediate obligaticn upon the condemning authority to pay just compensa- tion, even though the amount of the compensa- tion remains to be determined and paid at a later date. 3 i The New York statute applicable to this case (24 McKinney’s Consolidated Laws of New York Anno- tated, Section 30) provides that “appropriation by the state * * * snall be deerned complete and the title to such property shall be vested in the people of the state of New York” when a description of the property and a map are filed by the superintendent of public works in the office of the county clerk 01 register where tye property is located (Pet. App. 13). Since the map and descrivtion were filed in this case before the plan of liquidation was _ adopted, the condemnation sale did not come _ within Section 337(a). The Court of Appeals for the Sec- ond Circuit and the Tax Court have reached this con- clusion in this and similar cases. Wendell v. Commis- sioner, 326 F. 2d 600 (C.A. 2); Dwight v. United States, 328 F. 2d 973 (C.A. 2); Driscoll Bros. & Co. v. United States, 221 F. Supp. 603 (N.D. N.Y.), appeal to the Second Circuit dismissed by taxpayer, April 21, 1964; 84 Woodbine Street Realty Corp. v. Commis- sioner, decided by the Tax Court, September 26, 1963 (P-H Memo T.C., par. 63,262), appeal to the Second Circuit dismissed by the taxpayer, March 20, 1964. See also Commissioner v. Kieselbach, 127 F. 2d 359 (C.A. 3), affirmed as to another issue, 317 J.S. 399, where the court held that for the purposes of com- puting the holding period of a capital asset the owner ceased to held it at the date of the order vesting title in the condemni::g authority. There is no conflict. Henderson v. United States (W.D. Wash.), decided October 5, 1964 (64-2 USS. T.C., par. 9799), and Towanda Textiles, Inc. v. United 4 States, 180 F. Supp. 373 (Ct. Cl.), cited by the peti- tioner, both related to involuntary conversions taking place within 12 months after the plans of liquidation were adopted. The fact that under other (unspecified) statutes in New York or elsewhere the sale may occur at a later stage of the condemnation proceedings does not, contrary to petitioner’s suggestion (Pet. 7), create a constiti tional infirmity, nor are constitutional ques- tions raised by the fact that other taxpayers differ- ent'v situated may qualify for the Section 337(a) ex- ception while petitioner may not. See Phillips v. Com- missioner, 283 U.S. 589, 602; Poe v. Seaborn, 282 U.S. 101, 117-118. The petition for a writ of certiorari should be de- nied. Respectfully submitted. ARCHIBALD Cox, Solicitor General. LouIsS F. OBERDURFER, Assistant Attorney General. DAVID O. WALTER, MORTON K. ROTHSCHILD, Attorneys. MARCH, 1965 WG. S. GOVERNBENT PaINTiNG OFFice. 1965 767070 675 --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385602_0430%3A3. Public record. Not legal advice.