Diamond v. Commissioner

Arundell, J.,

dissenting: I would allow the deduction sought by petitioner under section 23 (a) (1) (A) as an ordinary and necessary expense, or under section 23 (e) as a loss incurred in trade or business. Petitioner was an employee of a corporation in which he was also a stockholder and officer. In connection with his employment by the corporation as a supervisor, he was required to furnish a car to move employees from job to job and otherwise in connection with his work. It was while so used that the accident occurred although the petitioner was not at the time driving the car. The expenditure he seeks to deduct was proximately related to the carrying on of his trade or business and, in my opinion, is deductible. Moreover, I think the record, taken as a whole, discloses that the loss was a business one and that the part of the loss sought to be deducted was not compensated for by insurance or otherwise. The amount sought to. be deducted was over and above the amount of the insurance. Petitioner testified his counsel advised him the Corporation was not liable and apparently the Corporation was either liquidated or in process of liquidation in 1947, the year in which the deduction was sought. El-kins, who was also an officer of the Corporation and who was driving the car at the time of the accident, apparently paid a part of the judgment obtained by the injured parties.

Murdock, J., agrees with this dissent.