# Respondents Brief in Opposition — Morgan v. Commissioner > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386401_0245%3A4 ## Record - **Collection:** Supreme Court brief - **Document type:** Respondents Brief in Opposition - **Published:** January 1, 1940 - **Citation:** 309 U.S. 78 ## Text a No. 210 : zs Inthe Supreme Court of the United States OctoBER TERM. 1939 J. Eart. Moreax, Executor oF THE Estatr op BiizABETH S. Morcan, Deckasep, PETITIONER v. (ivy T. Hetvertnc, ComMISSIONER oF INTERNAL REVENUE . ON PETITION FOR A WRIT OF CERTIORARI TO. THE UNITED STATES CIRCUIT COURT OF APPEALS FOR THE SEVENTH CIRCUIT ; BRIEF FOR THE RESPONDENT: IN OPPOSITION a INDEX Opinions below. . tii ne icaadea dines webencedseborses 1 PEs oo cc cccccccoevescteces saanenedeueeseebeosnes 1 Question presented. -......-*..---.------------------- hou 2 Statute and sepeatens involved Guisewebuwesone beasveeueueee 2 ee age suweeeen advéséeguqseeneaned 3 IN. occ vocecesdecen«se ~weescucbudeuduveusenabewadss 7 CIO. 6 ccs conccceccssesevectestbocceadseneeveuneue 14 CITATIONS a Cases: : ee Blackburne v. Brown, 43 F. (2d)°320.......-.----- wenenet - Blair v. Commissioner, -300 U. 8. 5... .------------ qroce 12 Burad v. Horadl, FEE DG. BH. WBBccccocccccctccccsceesese 12 Cawker v. Dreutzer, 197 Wis. 98--. - -- beqecctececcsovece . 9 Freuler v. Helvering, 291 U. 8. 35... ---.---------------- 12 Fidelity-Philadelphia Trust Co. v. McCaughn, 34 F. (2d) 600, certiorari denied, 280 U. 8. 602. - - -- Voccoqecccesecess Fil Helvering v. Grinnell, 204 U. 8. 153.......----.--------- 14 Lang v. Commissioner, 304 U: 8. 264... .-.- BEES a 12 Lee v. Commissioner, 57 F. (2d). 399, certiorari denied, 286 5 2 Se ee Seer the property must be a fee simple estate. Conse- _. quently i it is immaterial that, under the Wisconsin law, the power here. involved might possibly. “be. classified as “special’’ because it might be held to -- authorize the alienation of less than a ‘fee. See me - _ Griswold, Powers of Appointment and the Federal Gis Estate Taz, 52 Harv. L. Rev. 929, 942. ' 2. The decision below is not in conflict, as’ oer’ tioner contends (Pet. 10, 20-25), with the decisions _of this Court in Lang Vv. Commissioner, 304 U. S. ' 264; Sharp v. Commissioner, 303 U. S. 624; Blair v. Commissioner, 300-U. S, 5; Freuler v. Helvering, ~291 U. S. 35; or Poe ‘ve Seaborn, 282 U. S. 101. : Those cases merely hold that state law is’control- | ling i in determining the nature of the legal interest . which the taxpayer had in the property or income . subject to taxation. They do not hold that, after _ the nature of such interest is established, state law controls in determining whether such interest ' comes within the terms ‘of the Revenue Act. . As pointed out. in Burnet v. Harel, 287 U. ‘8. 103, state law creates legal interests but the federal law determines when and how they shall be taxed. There this Court held that a Texas gas.and oil lease, which under: Texas law was classified as a sale, was ~ =~, an = a ev 4 13 } ‘ not the type of transaction constituting a sale within the contemplation. of. the federal statute. 3 ‘taxing capital gains. More recently, in. Lyeth v. ~ . Hoey, 305 U. S. 188, a case dealing with the federal estate tax, this Court recognized that the taxpay- ' er’s status as an heir was'to be determined by state | ‘law but. that when, pursuant to a compromise - agreement among the heirs, a distribution was s ‘made, the question whether the property so received was “acquired by inliefitance”” within the . _meaning of the federal taxing - statute was necessarily a federal question. - 3.°While not asserted as a reason for granting - the writ, the further contention is made in the brief — supporting the petition (Br. 33) that the will and trust deed must be construed as vesting a veto _ power in the trustees over any appointment made: by the donee of the power. This contention was: Srejected by the court below after full consideration (R. 118-122) ‘and its decision i in this respect -pre- sents no conflictz but involves merely the construc- _ tion of. the particular instruments here involved. Accordingly, it furnishes no hasis. for the i issuance of the writ. be ks wn | --4, The additional contention is ‘stated but not, - argued (Br. 46) that the Revenue Act as applied _ to this case is invalid because retroactive, the power of appointment having been given prior to the first enactment of the tax. This contention is unten- | able, ‘The statute may be applied if the power is - exercised after the date of enactment. Lee v. Com- : micsionet, supra.’ | i | ieee ‘ | ae There. is no conflict of authority. The decision ; | below is in accord with the applicable decisions of ~— this Court. The petition should be denied. Respectfully submitted. . | RoBERT H. JAcKson, Solicitor General. seni, O. CuaRK, Jr., ° Assistant Attorney General. i SEWALL KEY, ; | JosePH M. “Jones, | Special Assistants to the Attorney. General, “RicuAnp H. DEMUTH, : saa arsttiie ~ Avousr, 1939. ) ‘ Disapproved only as to another point i in Heteering Y¥. ae a areal S. 153. ~ me one _ . . ’ - ne ee ‘ eo. ‘ » . --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386401_0245%3A4. Public record. Not legal advice.