Oliva v. Commissioner

Withey, J.,

dissenting: Although the broad issue before us in this case is whether the benefits received under the Esso sickness benefit plan are excludible from gross income of the taxpayer under section 22 (b) (5) of the Internal Revenue Code of 1939, there are involved in that question two separate subissues: First, is the benefit plan a contract of health insurance and, second, if so, is the term “health insurance” as employed in that section broad enough to include employer-purchased or financed health insurance. Put another way, the second subissue may be stated as, whether the term “health insurance” may be limited in its meaning to only the ordinary commercial type of health insurance which is evidenced by a formal policy purchased from one generally engaged in the business of selling such insurance to the public.

Congress has clearly expressed the intention that “amounts received through * * * health insurance * * * as compensation for * * * sickness” are to be excluded from gross income. The majority holding is to the effect that this clear language means that only such amounts as are received through insurance expressed in formal health insurance policies purchased from commercial purveyors of such policies are to be so excluded. In my view such a judicial amendment to the. law cannot be justified. While it is true that courts may add words to a statute or disregard words which are employed, this is true only where to do otherwise would do violence to an evident legislative scheme or plan. No such underlying plan is apparent here nor is one pointed to or relied upon by the majority.

In my opinion the sickness benefit plan here in controversy is a contract of health insurance under the reasoning of Epmeier v. United States, 199 F. 2d 508, and the benefits received thereunder are excludable from the gross income of the petitioner under section 22 (b) (5).

Johnson, /., agrees with this dissent.