*982OPINION.
Sea well :The findings of fact and opinion herein of the Division were promulgated May 31, 1933, 28 B.T.A. 241. As the result of a motion filed by the petitioners, the decisions entered on June 3,1933, pursuant to the report of the Division, were corrected on July 12, 1933, so as to show that the transferee liability of the petitioners for unpaid income and excess profits taxes of the Navarro Lumber Co. for 1919 and 1920 was $31,199.72 in the case of petitioner Buzard, and $26,947.70 in the case of petitioner Dusenbury, plus, in each case, interest thereon at the rate, of 6 percent per annum from February 26, 1926.
On August 9, 1933, the petitioners filed a motion for review of the Division report and decisions by the Board. By orders entered on August 10, 1933, the Chairman of the Board directed that “ the orders of Division No. 4, entered July 12, 1933,” be reviewed by the Board.
The petitioners claim that the decisions of July 12,1933, are wrong in that they provide for cumulative liability in excess of the unpaid taxes and interest on the deficiencies. There is no merit to the first point. The liability of transferees for unpaid taxes of corporations is several. Phillips v. Commissioner, 283 U.S. 589.
Transferee liability includes interest on the value of the assets received, provided claim is made therefor by the respondent. Henry Cappellini, 16 B.T.A. 802; Wayne Body Corp., 24 B.T.A. 524; Continental Baking Co., 27 B.T.A. 884; C. P. Ford & Co., 28 B.T.A. 156. We think such a claim was made in these proceedings.
The statements attached to the deficiency notices contain the fol-Dwing paragraph:
Under the provisions of Section 280 of the Revenue Act of 1926, there is proposed for assessment against you the amount of $53,086.18 plus any accrued penalty and interest representing your liability as a transferee of the assets of the Navarro Lumber Company for outstanding tax assessed against said company for the years 1919 and 1920 as per statement.
The petitions filed by the transferees allege as error the proposal of the respondent to assess “ interest or penalties ” due to delinquency of the transferor. In his answers to the petitions the respondent alleged that the petitioners were liable for outstanding taxes of the transferor for 1919 and 1920, with interest as provided by law.
We think these facts establish a claim on the part of the respondent for such interest on the unpaid taxes as is allowed by law. The deficiencies determined against the transferor for 1919 and 1920 were assessed, respectively, in April and March 1928, when the Revenue Act of 1926 was in force. Section 283 (d) of that act makes interest a part of the tax.
*983But the petitioners contend that the stipulation provides for a maximum transferee liability, including interest, of $26,947.70 in the case of petitioner Dusenbury, and $31,199.72 in the case' of petitioner Buzard.
The income and excess profits tax liability of the transferor is stipulated to be $13,568.75 for 1919, and $17,630.97 for 1920, a total of $31,199.72. The amounts received by the petitioners in liquidation of the Navarro Lumber Co., and their liability as transferees on account thereof, is set forth in the stipulation in .the following words and figures:
That the Board may find and determine that E. T. Dusenbury, Petitioner,.on August 7,. 1922, received distributions in liquidation of the Navarro Lumber Company in the sum and of the value of $26,947.70, for which he is liable as a transferee of said the Navarro Lumber Company, under Section 280 of the Revenue Act of 1926, unless the Board should find and determine that the assessment of said liability against him is barred by the Statute of Limitations; that R. T. Buzard, Petitioner, on said August 7, 1922, received distributions in liquidation of the Navarro Lumber Company of an amount and value equal to and in excess of the sum of the aforesaid deficiencies with respect to the Navarro Lumber Company for the taxable year 1919 and 1920, in the respective amount of $13,568.75 and $17,630.97, making the sum of $31,199.72, for which he is liable as a transferee of said The Navarro Lumber Company under Section 280 of the Revenue Act of 1926, unless the assessment of said liability against him is barred by the Statute of Limitations.
There is nothing in this agreement of facts expressly limiting the liability of the petitioners to the amounts claimed by them, and the language used does not, as we understand it, infer as much. It goes no further than provide a basis for finding that the petitioners received specified amounts in liquidation of the Navarro Lumber Co. in order to establish their status as transferees. The amount of interest involved is considerable. Had the parties intended that the amounts received represented the maximum liability of the petitioners for taxes and interest, words clearly evidencing such intent would have been employed. We are unable to find that the parties agreed to limit the total liability of petitioner Dusenbury to $26,947.70, and petitioner Buzard to $31,199.72, as claimed.
The maximum amount assessable against transferees was first before us in Henry Cappellini, supra. We said there:
While the courts seem to hold divergent views as to when interest begins to run against stockholders who.are liable to creditors of a corporation, we are impressed with the decision in United, States v. Snook, 24 Fed. (2d) 844, as being a fair and equitable rule to be applied in transferee eases.' That decision, where the tax liability was greatly in excess of the amount received by the transferees in distribution, holds the transferees liable to the full-extent bf the amounts received by them with interest from “ the fair average date of receiving ” the sums distributed. Cf. McWilliams v. Excelsior Coal Co., 298 Fed. 844. That method of computation represents the maximum liability of the transferees and applies where the tax and interest imposed on the corpo*984rate transferor is greater than the amount received in distribution, plus interest from that date. Where the tax and interest thereon is less than the amount distributed to any one transferee, then the liability of such transferee would be limited to the amount of tax and interest thereon.
Accordingly, it is held in these cases that the amount the respondent may assess in each case is the amount of taxes owing by the Masontown Coal Co., plus interest at the rate of 6 per cent per annum from February 26, 1926; provided, however, that the liability of any one of the petitioners shall not exceed the amount received by him in distribution, plus interest at 6 per cent per annum (the legal rate in Pennsylvania) from the date of distribution. In other words, the maximum amount assessable against any one of the petitioners is the lower amount of either (1) the tax plus interest from February 26, 1926, to date of assessment, or (2) the amount received in distribution, plus interest from the date thereof, viz., August 15, 1920, to date of assessment. In these cases, the amount of tax being less than the amount received in distribution, and February 26, 1926, being a later date than that of the distribution, the amount assessable is $4,268.39, plus interest from February 26, 1926. An order will be entered accordingly in each of the proceedings.
This is still the rule before the Board. Edward H. Garcin, 22 B.T.A. 1027; Wayne Body Corp., supra; Frederick L. Watson, 25 B.T.A. 971.
In the Garcin and Watson cases the amounts received in 1920 by the petitioners as transferees were less than the amount of taxes found to be due from the transferors. In each proceeding we held the liability to be the amount received in liquidation, plus interest at the rate of 6 percent per annum (the prevailing legal rate in New York and Massachusetts) from the date, of distribution of the corporate assets.
The transferor was a California corporation and the petitioners are residents of San Francisco, California. In that state the legal rate of interest is 7 percent per annum. Act 3757, General Laws of California.
Petitioner Buzard having received at least $31,199.72, the amount of taxes owing by the transferor, in liquidation of the corporation, his transferee liability is, in accordance with the cases cited, that amount, plus interest at the rate of 6 percent per annum from February 26, 1926.
Petitioner Dusenbury received the sum of $26,947.70 on August 7, 1922, as a transferee of the corporation. The sum so received in distribution, plus interest thereon from the date of receipt to February 7, 1934, an estimated date of assessment against; the transferee, at the rate of 7 percent per annum, the legal rate of interest in California, amounts to $48,640.70. The unpaid taxes of $31,199.72 of the transferor, plus interest thereon at the rate of 6 percent per annum from February 26, 1926, to February 7, 1934, amounts to $46,078.13. The latter sum being less than the former one, the maximum liability of petitioner Dusenbury, following Henry Cappellini, *985supra, is the amount of the unpaid taxes, plus interest thereon at the rate of 6 percent per annum from February 26, 1926, to the date of assessment.
The order of the Division entered July 12, 1933, in Docket No. 42793, involving petitioner Buzard, is affirmed, and the Division order entered the same date in Docket No. 43017 will be modified so as to provide that the liability of petitioner Dusenbury as a transferee for unpaid income and excess profits taxes of the Navarro Lumber Co. for 1919 and 1920 is $31,199.72, plus interest thereon from February 26, 1926, to the date of assessment at the rate of 6 percent per annum.
Reviewed by the Board.
Sternhagen, Van Fossan, Murdock, and Matthews dissent.