United States v. John B. Beard and Helen B. Beard

Contending that certain income realized by appellee Beard, hereafter the taxpayer, was realized from sale of “property held by the taxpayer primarily for sale to customers in the ordinary course of his trade or business,” within the meaning of 1939 Internal Revenue Code, § 117(a) (1), 26 U.S.C.A. § 117 (a) (1), the Commissioner made deficiency assessments in the sum of $36,519.29 plus interest, for the taxable years 1946 through 1950.

Taxpayer paid the deficiencies and brought suit in the trial court for its recovery. Findings were made and judgment entered in favor of appellees. In disposing of the questions posed on this appeal we are confronted solely with a question of fact “which ordinarily is governed by the findings of the trial court, unless these are clearly erroneous or unless an appellate court is convinced by an examination of the entire record that a mistake has been committed.” Bistline v. United States, 9 Cir., 260 F.2d 77, 78 . “Cases of this character present difficulties because there is no agreement among the courts as to what primary element in the transaction determines its character.” Pool v. Commissioner, 9 Cir., 1957, 251 F.2d 233, 235 .

We turn now to a…