Commissioner v. Duberstein
United States Supreme Court
363 U.S. 278 (1960)
Duberstein and Stanton (defendants) were unrelated taxpayers who failed to include as gross income the receipt of what they believed to be gifts. Duberstein was president of Duberstein Iron & Metal Company, which conducted business with Mohawk Metal Corporation (Mohawk). Berman, the president of Mohawk, would occasionally ask Duberstein for the names of people who might be interested in purchasing Mohawk’s products. On one occasion, Duberstein did provide the names of potential customers for Berman. Berman later contacted Duberstein, stating that Duberstein’s tips had proven so valuable that Berman wished to provide him with a car in appreciation. Mohawk later denoted the value of the car as a business expense on its corporate tax return. Believing that the car was a gift, Duberstein did not include the value of the car as gross income on that year’s tax return. The Commissioner found a deficiency in Duberstein’s return in the amount of the car’s value. The Tax Court agreed. The Court of Appeals for the Sixth Circuit reversed. In a separate case, Stanton was an employee of a church for approximately ten years. In 1942, he left the church to begin his own business. Upon his resignation, his employer passed a resolution to grant him a total of $20,000 in appreciation for his services, to be dispensed in monthly installments. The resolution relieved the employers of any obligation to pay Stanton a pension or retirement benefit, although the employer did not have any such obligation at the time. Stanton was not required to perform any further services for the church. He did not report the receipt of the monthly installments on his income tax return for that year. The Commissioner found a deficiency in the amount of the monthly installments. Stanton paid the deficiency but subsequently sued in the United States District Court for the Eastern District of New York for a refund. The District Court found the payments were a gift and ruled in Stanton’s favor. The Court of Appeals for the Second Circuit reversed. The United States government sought review of both cases, requesting clarification of what constitutes a gift. The United States Supreme Court granted certiorari.
Rule of Law
Holding and Reasoning (Brennan, J.)
Concurrence/Dissent (Frankfurter, J.)
What to do next…
Unlock this case brief with a free (no-commitment) trial membership of Quimbee.
You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 97,000 law students since 2011. Some law schools—such as Yale, Vanderbilt, Berkeley, and the University of Illinois—even subscribe directly to Quimbee for all their law students. Read our student testimonials.
Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.
Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students. Read more about Quimbee.
Here's why 166,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 13,800 briefs, keyed to 187 casebooks. Top-notch customer support.
- The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
- Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
- Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.