American Properties, Inc. v. Commissioner Of Internal Revenue

262 F.2d 150 59-1 USTC P 9130 AMERICAN PROPERTIES, INC., and The Estate of Stanley S. Sayres, deceased, Harold L. Scott, and A. R. Munger, Executors, and Madeleine A. Sayres, Petitioners, v. COMMISSIONER OF INTERNAL REVENUE, Respondent. No. 16051. United States Court of Appeals Ninth Circuit. Dec. 10, 1958. Kenneth P. Short, Seattle, Wash., for petitioners. Charles K. Rice, Asst. Atty. Gen., George W. Beatty, Lee A. Jackson, I. Henry Kutz, C. Guy Tadlock, Attys., Dept. of Justice, Washington, D.C., for respondent. Before ORR, CHAMBERS, and HAMLIN, Circuit Judges. PER CURIAM. 1 Petitioner Stanley S. Sayres, a well known power boat racing enthusiast, sought to deduct expenses of building, maintaining and operating certain of these boats as an ordinary and necessary expense of petitioner American Properties, Inc., a corporation of which Sayres was the sole owner. Int.Rev.Code of 1939, 23(a)(1)(A), 26 U.S.C.A. 23(a)(1)(A). These deductions were denied by the Commissioner who considered them not to be business expenses, but actually dividends to Sayres as the funds in question were expended for his own personal use. Furthermore, Sayres as an individual was also denied a deduction for…