Murphy Oil Co. v. Commissioner

1. Legal expenses and a payment in compromise of a suit alleging petitioner acquired oil properties by fraudulent means and seeking to recover the properties, together with an accounting for profits obtained from dealings with such properties, were not personal expenses, nor were they deductible as business expenses, for that portion allocable to the defense of the claim against title was a capital expenditure. 2. The claim for an accounting was a distinct claim involving a distinct group of assets and that portion of the expenses and compromise payment allocable to the defense and settlement…