E. Robert Breech, Jr., and Mara W. Breech v. United States of America, Melvin C. Drummond and Dorothy M. Drummond v. United States of America, Albert W. Haensli and Ragna S. Haensli v. United States

439 F.2d 409 E. Robert BREECH, Jr., and Mara W. Breech, Plaintiffs-Appellees, v. UNITED STATES of America, Defendant-Appellant. Melvin C. DRUMMOND and Dorothy M. Drummond, Plaintiffs-Appellees, v. UNITED STATES of America, Defendant-Appellant. Albert W. HAENSLI and Ragna S. Haensli, Plaintiffs-Appellees, v. UNITED STATES of America, Defendant-Appellant. Nos. 23914-23916. United States Court of Appeals, Ninth Circuit. March 10, 1971. Ernest J. Brown (argued), Atty., Tax Div., Johnnie M. Walters, Asst. Atty. Gen., Lee A. Jackson and Gilbert E. Andrews, Tax Div., Washington, D. C., Wm. Matthew Byrne, Jr., U.S. Atty., Los Angeles, Cal., for appellant. John C. Argue (argued), of Flint & MacKay, Los Angeles, Cal., for appellees. Before DUNIWAY, HUFSTEDLER, and KILKENNY, Circuit Judges. HUFSTEDLER, Circuit Judge: 1 The Government seeks reversal of a judgment of the district court awarding tax refunds to taxpayers E. Robert Breech, Melvin C. Drummond, and Albert W. Haensli. 1 2 The taxpayers were the principal shareholders of Valley Ford Sales ("Valley-1"), a California corporation operating a Ford dealership in Fresno, California. In May of 1957, Valley-1 sold all its assets to a…