Blow v. Commissioner

*872 This is a proceeding for the redetermination of a deficiency in estate tax in the amount of $4,033.46.

It is alleged that the respondent has erroneously determined the value of real estate owned by the decedent at Yorktown, Va., and in York County, Virginia, at the value of $80,000, when in fact the fair, reasonable value of said real estate and improvements as of November 20, 1922, did not exceed $35,000.

FINDINGS OF FACT.

The decedent, George P. Blow, died November 20, 1922. During 1922 and prior thereto he had resided in La Salle, Ill. Blow was a graduate of the United States Naval Academy, and remained in the Navy until about 1900, at which time he had a rank of Lieutenant, Junior Grade.

Blow was very fond of the water and was also much interested in the history of Virginia, particularly Yorktown, near which his ancestral home was located.

In 1909 Joseph Bryan and A. A. Blow, brother of George P. Blow, purchased the Nelson estate, *2505 located in the center of the town of Yorktown, from the Nelson heirs, for $3,000. In September, 1914, George P. Blow purchased the property from them for $5,000, the approximate cost to them of the property and improvements, which included a new slate roof on York Hall, which is the name of the old Nelson home.

York Hall was built at some time between the years 1711 and 1730, and was the home of Governor Nelson of Virginia. During the *873 siege of Yorktown in the Revolutionary War it was occupied as headquarters by General Cornwallis. The home was struck by cannon balls which are still lodged in its walls. The grounds surrounding the house still contain entrenchments made at that time. George P. Blow was interested in restoring the place to its original state and to that end he employed landscape architects to improve the grounds. This work was done at great expense, due partly to the lack of fertility of the soil. He also purchased some additional lots adjoining the estate, in order to preserve some of the entrenchments, and in order to insure a view of the river from the estate. Blow made efforts to cause the Government to convert Yorktown into a national park.

*2506 At the time of his death the property owned by George P. Blow in Yorktown consisted of slightly more than five acres of land. The buildings included York Hall, a gardener's house, a stable, a garage, a chauffeur's cottage, a guest cottage and a manager's cottage.

York Hall, which was a brick building having two stories and an attic, contained 17 rooms and 6 baths. Dormer windows had been added to the attic and other improvements made. In 1920 an electric light engine had been installed.

The gardener's house had been added to, painted and papered, and made modern with plumbing.

The stable and garage were of brick and were built by Blow.

The guest cottage was of brick and consisted of one story and a half. It had six rooms and two baths.

A high brick wall surrounded the whole property.

The property in Yorktown owned by Blow, at the time of his death, consisted of lots 48, 49, 50, 52, 53, 54, 55, 84, 85, 120, 121, 122, 123, 124, 125, 126, 127, 128 and 129 and six-sevenths of lot 47. Blow also owned lot 21, Jamestown Portland Cement Subdivision, which is about one mile down the river from the home property.

Lot 46, which was directly between the home and the*2507 York River, was not owned by Blow but was under lease to him at the time of his death. All of the town lots are adjacent to York Hall.

The cost of acquisition to Blow of all his property in Yorktown was about $20,000.

Adjacent to the property owned by Blow on two sides were lots owned by colored people. The lots between the house and the river were hillside lots that were not practical for real estate development.

In 1922 Yorktown had a population of from 150 to 200 persons, at least half of whom were colored. It had no water, gas, lights or sewage systems. The climate is cold and damp in the winter time and hot in the summer time. Any breeze which exists in the summer is a land breeze. There is no large business in Yorktown, the residents being engaged largely in fishing and trucking.

*874 Yorktown is about 67 miles from Richmond, and in 1922 the road between the two towns was almost impassable. The nearest railroad stop to Yorktown was Leehall, which is seven miles distant. Leehall, in 1922, was connected with Yorktown by a concrete road, but the only means of conveyance between the two towns was private busses. There was also an improved road from Yorktown*2508 to Newport News. Yorktown is about 12 or 14 miles from Williamsburg, but in 1922 there was no improved road between the two towns. In 1922 there was a steamship line which operated between Baltimore and West Point which stopped at Yorktown at 4 a.m. The boat left Yorktown for Baltimore between 8.30 and 10 p.m. daily, except on Sunday.

The Nelson home in 1922 was not very desirable as a residence. Tourists interested in the history of the place constituted a nuisance. Between Yorktown and Penham the United States Government in 1922 was constructing a mine depot at which explosives were to be stored. The nearest point from the Government reservation to Blow's property was about one mile. On the other side of Yorktown was a Navy fuel base, the operations of which often caused the water to be oily. These two establishments close to the Nelson property detracted from its value to some extent. Blow, in restoring the place to its original condition, did not wish to add anything which would detract from the colonial atmosphere, and as a consequence the house contained few modern improvements. There was no "social" life in or about Yorktown.

In 1922, and thereafter for a year*2509 or more, there was no local market for such a place as the Nelson property.

The expense of maintaining he place was prohibitive to any historical society which might otherwise be interested in acquiring it. The cost of keeping the place in good condition averaged about $10,000 yearly.

No efforts were made to sell the property in question after the death of George P. Blow.

In 1911 Joseph Bryan and A. A. Blow tried to sell the Nelson home to the Daughters of the American Revolution for $5,000, but they did not buy it. About 1914 the Colonial Dames also refused to pay $5,000 for the place.

About 1905 or 1907 a colonial estate known as "Carter's Grove," which is located half way between Yorktown and Williamsburg, sold for about $20,000. This estate comprised about 250 acres of land bordering on the James river. It had a two-story, colonial brick dwelling, with outbuildings on each side. It had been purchased for about $70,000.

About 1918 the United States Government appraised about 118 acres of land adjacent to Yorktown on the river bluff at about *875 $14,000. This land was better adapted for summer homes than the Nelson property in Yorktown.

"Indian Field*2510 Farm," an old historical farm about three miles up the river from Yorktown, was bought by the United States Government during the World War for $40,000 - an average of $100 per acre. This was a well improved farm which had a long water frontage.

The Moore house, which is a frame house about two miles farther down the York river from Yorktown, was offered for sale by Mrs. Yager, its owner, in 1925, to Mr. Curtis and Mr. Dozier for $50,000. They in turn offered her $45,000, but the deal was not closed. In 1928 the place was sold for $35,000. This estate contained about 8 acres and the house located thereon is believed to be the one in which the surrender of General Cornwallis to General Washington took place.

About 10 or 15 years prior to the time that George P. Blow acquired the Nelson property, a two-story brick house directly across the street from the Nelson place with three acres of ground, sold for $500. It was not as large an estate as the Nelson place but was the oldest home in Yorktown.

In its return the estate placed a value of $35,000 upon the property in question. The respondent held that the value of such property was $80,000.

The property involved in the*2511 proceeding had a value of $35,000 on November 20, 1922.

OPINION.

SIEFKIN: The sole question is one of fact as to the value, for estate-tax purposes, of property owned by George P. Blow at Yorktown, Va., at the date of his death, November 20, 1922.

From all the evidence in the case we have determined as a fact that the property had a value as of November 20, 1922, of $35,000.

Judgment will be entered under Rule 50.