Bernier v. Bernier’s Empirical Analysis

Citation profile

17 state decisions

Most-quoted passages

The sentences later courts lift from this opinion, ranked by how many decisions quote each — the parts of the opinion doing the work. These counts are smaller than the citation total above because most of the 18 citing decisions cite the case generally; a passage count includes only decisions quoting that exact language verbatim.

1. ““The Delaware court determined the 29.4 per cent figure by creating fictional percentages to represent Federal corporate tax at the entity level and dividend tax at the shareholder level, to arrive at the same figure that would be left in the pockets of shareholders of an S corporation after taxing one hundred dollars of earnings (i.e., sixty dollars resulting after taxing one hundred dollars of earnings at the rate of forty per cent as in our example . . . ). To derive this fictional figure, the court worked in reverse. To achieve a posttax income of sixty dollars (after corporate entity tax and dividend tax), the figure to tax would be $70.60 (fifteen per cent of $70.60 is $10.60, and subtracting the latter from the former arrives at sixty dollars). To arrive at $70.60 from the total one hundred dollars of earnings, the court subtracted 29.4 per cent, the appropriate fictional tax rate. Phrased differently, the court asked at what rate a C corporation would be taxed at the entity level to permit the shareholder to receive a distribution of sixty dollars (as he would from an S corporation) rather than the fifty-one dollars he would have received as a C corporation shareholder. That differential rate captures the benefit of ownership in the S corporation.””

   1 later decision quote this exact passage · from the concurrence
   e.g. Bernier v. Bernier

2. ““In the novel and complex circumstances of this case, we conclude that valuation of the markets and equal distribution of property are not issues that are easily separable. The parties’ original stipulations provided that the supermarkets would advance the parties’ attorney’s fees, with the payments ‘debited to the party’s account who has incurred those expenses,’ and that such payments would be considered loans repayable by each party on the ‘final division of [the] marital assets.’ The parties agreed to an equal division of the marital assets and the supermarkets. Each party has expended a considerable sum for legal representation toward the joint goal of valuing the supermarkets and dividing these assets. A final equalization of the supermarkets should incorporate the fees paid to attorneys for each party, and be treated so that each party is effectively debited with half of the attorney’s fees. To fail to do so would leave the wife to pay her entire legal expenses out of her own pocket while the husband effectively would receive a windfall by simply moving money from one source under his control to another.””

   1 later decision quote this exact passage · from the concurrence
   e.g. Bernier v. Bernier

3. ““Horvitz tax affected as if the S corporation were a C corporation, at what he termed the ‘average corporate rate’ of thirty-five per cent.[ 5 ] ... He testified that tax affecting the S corporations at the C corporation rate was proper because, among other things, a person contemplating the purchase of an S corporation would factor into his probable rate of return the tax consequences of the purchase. Leicester, on the other hand, did not tax affect the supermarkets’ income in his valuation because, as he testified, an S corporation, unlike a C corporation, does not pay taxes at the entity level, and because no sale of the business was contemplated.””

   1 later decision quote this exact passage
   e.g. Bernier v. Bernier