North American Oil Consolidated v. Burnet
United States Supreme Court
286 U.S. 417 (1932)
North American Oil Consolidated (NAOC) (plaintiff) operated a section of oil land owned by the United States. The government sued to oust NAOC in 1916, and a receiver was appointed to manage the property and retain the net profits until the case was decided. In 1917, NAOC won the lawsuit, and the receiver paid the company $171,979.22 in net profits from 1916. The government appealed to the Court of Appeals for the Ninth Circuit, which affirmed. NAOC did not initially report the 1916 net profits as income on its tax return. However, in 1918, NAOC filed an amended return and included the profits. Burnet (defendant), the Commissioner of Internal Revenue, audited NAOC’s 1917 return and found a deficiency for unrelated reasons. NAOC appealed the deficiency to the Board of Tax Appeals, but Burnet sought to increase the deficiency to reflect the receiver’s 1917 payment to NAOC. The Board held that the income was taxable to the receiver, not NAOC. Burnet appealed to the Ninth Circuit, which held that the amount was taxable to NAOC in 1917, without regard to whether it used the cash-receipts-and-disbursements basis or accrual basis. NAOC petitioned the Supreme Court for certiorari, which was granted.
Rule of Law
Holding and Reasoning (Brandeis, 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 687,000 law students since 2011. Some law schools—such as Yale, Berkeley, and Northwestern—even subscribe directly to Quimbee for all their law students.Unlock this case briefRead 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.Learn about our approachRead more about Quimbee
Here's why 687,000 law students have relied on our case briefs:
- Written by law professors and practitioners, not other law students. 42,900 briefs, keyed to 988 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.