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executory; since he never paid for his stock, he never became a
shareholder; since he never was a shareholder, he need not report
a pro rata share of Niesar Pahl’s income and other items.
We have found that petitioner neither made the payment
contemplated in his agreement to become a shareholder of Niesar
Pahl nor did he receive any shares of the corporation. To that
extent, the terms of his agreement with Niesar Pahl remained
unperformed. Nevertheless, petitioners concede: “there is no
question that one can own an interest in a corporation without
holding any physical evidence thereof, Richardson v. Shaw, 209
U.S. 365 (1908)”. Petitioners also concede that one can own
shares in a corporation before they are fully paid for: “Whether
PAHL acquired sufficient rights [of] ownership to make him the
owner of the stock depended upon the intent of the parties as
evidenced by their contract.” While it is no doubt true that
payment may be a precondition to obtaining ownership of shares in
some circumstances, see, e.g., Armstrong v. Commissioner, 6 T.C.
1166 (1946) (contract to purchase shares executory until delivery
of shares and payment therefor; long-term capital gains period
did not start to run until delivery), affd. 162 F.2d 199 (3d Cir.
1947), we do not believe that was the case here.
Clearly, Niesar Pahl did not treat payment as a precondition
to petitioner’s becoming a shareholder. The corporation caused
its name to be changed to Niesar, Pahl, Cecchini & Gosselin, A
Professional Corporation. The Certificate of Amendment filed
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