Dr. Warren B. Demink and Mrs. Helen Demink v. United States

This is an appeal from a judgment of the District Court denying a Complaint for Refund of Taxes, amounting to $23,967.03 claimed to have been overpaid by taxpayers for the year 1958, together with interest paid on said taxes to the government (amounting to $9,347.14), and the usual interest and costs.

Jurisdiction in the District Court was based on 26 U.S.C. § 7422 ; 28 U.S.C. § 1346 (a) (1); 28 U.S.C. § 1402 (a) (1); and the Internal Revenue Laws of the United States. This Court has jurisdiction under 28 U.S.C. § 1291 , et seq.

Two issues were presented to the District Court, sitting without a jury— first: “Whether Dr. DeMink had any basis in the $64,037.79 promissory note issued to him by Hospital Properties, Inc. in 1957, and subsequently transferred by him to Mrs. Helen Richardson as part of the Settlement Agreement of September 13, 1958”, and second:

“Whether the transfer of the $64,037.79 note as part of the September 13, 1968 Settlement Agreement, along with the cancellation of certain other corporate indebtedness resulting from personal advances toward operating expenses of approximately $12,000 should be treated as a deductible cost of compromise, or as part of Dr.…