Estep v. King County

The sole asset of Molehill, Inc., a Washington corporation, was a vendee’s interest in a contract to purchase certain real property owned by Mr. and Mrs. William E. Russell.

The secretary and counsel of Molehill, Inc. testified that the corporation refused the offer of H. R. Watchie to purchase its interest in the Russell contract because of the possibility that both the corporation and stockholders, upon distribution, would be subject to federal income tax on capital gains. We do not ascribe a sinister motive to the Molehill stockholders in their attempt possibly to minimize their federal…