- 29 -
goodwill, and the franchise are so interrelated as to
be indistinguishable, all the value should then be
assigned to the franchise. * * * [Emphasis added; fn.
ref. omitted.]
In Zorniger v. Commissioner, 62 T.C. 435 (1974), we
addressed the issue of whether the taxpayer's shares of stock in
a Chevrolet dealership possessed goodwill that should have been
reflected in the valuation of the stock for purposes of the gift
tax. We held that no goodwill existed in the stock, since the
dealership agreement required Chevrolet's prior approval of any
transfer of the taxpayer's interest therein. Id. at 444-445. We
relied principally on our decision in Akers v. Commissioner, 6
T.C. 693, 700 (1946), where we determined that no goodwill
existed in a General Motors' dealership upon liquidation, as the
taxpayer had a nontransferable, personal services contract, which
could have been divested from the taxpayer under circumstances
outside his control. In Zorniger v. Commissioner, supra at 444-
445 (quoting Akers v. Commissioner, supra at 700), we stated:
"The franchises were not assignable and by their terms
were made personal contracts between the parties. Such
good will or going-concern value as the corporation
might have created during its existence was subject at
all times to be divested by termination of the
franchises without action by the corporation. * * *
The good will, if any, continued to be embodied in the
franchises and they, under the circumstances, were not
property subject to transfer or other disposition by
the corporation." [Citation omitted.]
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