REALIZATION OF INCOME THROUGH CANCELLATIONS, MODIFICATIONS, AND BARGAIN PURCHASES OF INDEBTEDNESS: II

Introductory note. That some matters relating to the particular consideration received by a debtor on incurring an obligation would affect the applicability of the Kirby case to a saving derived by him from a subsequent cancellation or other bargain discharge was one of the first propositions settled by the Supreme Court. For the Kirby case itself justified the earlier immunity which had been granted the apparently solvent Kerbaugh-Empire Company on the ground that the funds which the latter had borrowed were lost in the venture for which its loan had been procured.