U.S. Supreme Court NEW COLONIAL ICE CO. v. HELVERING, 292 U.S. 435 (1934)

[Page 292 U.S. 435, 442]

holders of the two corporations were substantially the same constitutes such a basis.

As a general rule a corporation and its stockholders are deemed separate entities3 and this is true in respect of tax problems. [Footnote 4] Of course, the rule is subject to the qualification that the separate identity may be disregarded in exceptional situations where it otherwise would present an obstacle to the due protection or enforcement of public or private rights. 5 But in this case we find no such exceptional situation-nothing taking it out of the general rule. On the contrary, we think it a typical case for the application of that rule.

The petitioner relies on Pioneer Pole & Shaft Company v. Commissioner ( C.C.A.) 55 F.(2d) 861, Industrial Cotton Mills Co. v. Commissioner (C.C.A.) 61 F.(2d) 291, and H. H. Miller Industries Co. v. Commissioner (C.C.A.) 61 F.(2d) 412. The decisions in these cases are not wholly in point but contain language giving color to the petitioner's claim, and are to that extent in conflict with other federal decisions, notably Athol Mfg. Co. v. Commissioner (C.C.A.) 54 F. (2d) 230; Turner-Farber-Love Co. v. Helvering ( C.C.A.) 68 F.(2d) 416; and the decision now under review. In so far as they are not in harmony with the views expressed in this opinion they are disapproved.

Judgment affirmed. Footnotes

Footnote 1 United States v. Phellis, 257 U.S. 156, 42 S.Ct. 63; Rockefeller v. United States, 257 U.S. 176, 42 S.Ct. 68; Cullinan v. Walker, 262 U.S. 134, 43 S.Ct. 495; Weiss v. Stearn, 265 U.S. 242, 44 S.Ct. 490, 33 A.L.R. 520; Marr v. United States, 268 U.S. 536, 45 S.Ct. 575.

Footnote 2 See Southern Pacific Co. v. Lowe, 247 U.S. 330, 337, 38 S.Ct. 540; Peabody v. Eisner, 247 U.S. 347, 349, 38 S.Ct. 546; Gulf Oil Corporation v. Lewellyn, , 39 S.Ct. 35.

Footnote 3 Pullman's Palace Car Co. v. Missouri Pacific R. Co., 115 U.S. 587, 596, 597 S., 6 S.Ct. 194; Donnell v. Herring-Hall-Marvin Safe Co., 208 U.S. 267, 273, 28 S.Ct. 288; United States v. Delaware, etc., Co., , 527-529, 35 S.Ct. 873; Cannon Mfg. Co. v. Cudahy Packing Co., 267 U.S. 333, 45 S.Ct. 250; Klein v. Board of Tax Supervisors, 282 U.S. 19, 24, 51 S.Ct. 15, 73 A.L.R. 679.

Footnote 4 Klein v. Board of Tax Supervisors, 282 U.S. 19, 24, 51 S.Ct. 15, 73 A.L.R. 679; Dalton v. Bowers, 287 U.S. 404, 410, 53 S.Ct. 205; Burnet v. Clark, 287 U.S. 410, 415, 53 S.Ct. 207; Burnet v. Commonwealth Improvement Co., , 418-420, 53 S.Ct. 198.

Footnote 5 United States v. Lehigh Valley R. Co., 220 U.S. 257, 272-274, 31 S. Ct. 387; Chicago, Milwaukee & St. Paul Ry. Co. v. Minneapolis Civic & Commerce Ass'n, 247 U.S. 490, 500, 501 S., 38 S.Ct. 553; Southern Pacific Co. v. Lowe, 247 U.S. 330, 337, 338 S., 38 S. Ct. 540; Gulf Oil Corporation v. Lewellyn, , 39 S.Ct. 35.