E. W. Edwards & Sons v. United States

BRENNAN, Chief Judge.

The only question here is whether the sum of $100,000 paid by the corporate taxpayer to the trustees of a trust owning a majority of the stock of the taxpayer corporation to enable them to compromise a pending litigation against them is deductible from gross income as an ordinary and necessary expense of carrying on its trade or business under the provisions of Section 23(a) (1) (A) Internal Revenue Code of 1939, 26 U.S.C.A. § 23(a) (1) (A).

This litigation was submitted upon a stipulation of facts filed with the Court which constitute the trial record. The question is…