C. D. CONSTRUCTION CORPORATION, APPELLANT,

v.

COMMISSIONER OF INTERNAL REVENUE, APPELLEE

CRAVEN, Circuit Judge:

This is an appeal from a decision of the Tax Court that C. D. Construction Corporation is liable as a transferee for unpaid federal income taxes of Charles Town Corporation under 26 U.S.C.A. § 6901(a) (1) (A) (i).1 We affirm. Briefly, the facts are these:2

The Tax Court correctly found that Fairmount was in substance a stockholder of Charles Town and, by implication, that the transfer of racing proceeds from Charles Town to Fairmount was a corporate distribution. Fairmount, therefore, was liable for Charles Town’s taxes “in equity” under 26 U.S.C.A. § 6901 (a) (1) (A) (i):

[T]he parties * * * lost sight of the universal rule. Under it stockholders in dissolution are not ordinary transferees of corporate property as might, for example, be the case of a purchaser of a specific piece of its property as to whom a conveyance carries a quasi in rem liability only when in fraud of creditors. Stockholders in distribution have not purchased property. They receive only an aliquot share of property. The right to receive it flows from the accumulation of it in excess of the obligations owed and by which assets, in this or other forms, have been accumulated. Such stockholders receiving property in distribution hold it subject to pro rata liabilities of the corporation. [Citations omitted.] The stockholders hold what they get subject to an equitable lien. “The capital and assets of a cor poration constitute a trust fund, for the benefit and security of its creditors, and it is fundamental that stockholders, stripping a corporation of its assets, succeed as transferees to its tax liability. [Citations omitted.]” It is, then, by an ageless principle a liability imposed “in equity,” * * *

Neill v. Phinney, 245 F. 2d 645, 651-52 (5th Cir. 1957).

Fairmount was also liable for Charles Town’s taxes “at law” under 26 U.S.C.A. § 6901(a) (1) (A) (i). According to the applicable West Virginia statute,4 Fairmount was liable for Charles Town’s taxes if the transfer of the racing proceeds was “not upon consideration deemed valuable in law.” There was no consideration for the transfer. Fair-mount’s assumption of the risk of loss was not consideration within the meaning of the statute; it was simply a risk that is borne by every stockholder to the extent of his investment. Fairmount’s right to receive 90 per cent of the racing profits was not consideration for the use of the money advanced as it would have been had the advances to Charles Town been loans. The right was reasonably viewed by the Tax Court as a right to receive dividends based on capital contribution. Because Fairmount was a stockholder, its right to any corporate income was subject to the corporation’s liabilities, including the government’s claim for taxes due on the income.

For the reasons stated above and for the further reasons stated in the decision of the Tax Court, T. C. Mem. 1970-297, (1970), the judgment below is

Affirmed.

. 26 U.S.C.A. § 6901(a) (1) (A) (i) :

(a) Method of collection. — The amounts of the following liabilities shall, except as hereinafter in this section provided, be assessed, paid, and collected in the same manner and subject to the same provisions and limitations as in the case of the taxes with respect to which the liabilities were incurred:

(1) Income, estate, and gift taxes. — ■

(A) Transferees. — The liability, at law or in equity, of a transferee of property—

(i) of a taxpayer in the case of a tax imposed by subtitle A (relating to income taxes). * * *

. For a full factual background of this dispute see Charles Town, Inc. v. Commissioner of Internal Revenue, 372 F. 2d 415 (4th Cir.), cert. denied, 389 U.S. 841, 88 S.Ct. 69, 19 L.Ed.2d 104 (1967).

. C. D. Construction received the assets of Fairmount without consideration and would, therefore, be liable “in law” under 26 U.S.C.A. § 6901(a) (1) (A) (i), supra n. 1, by operation of W.Va.Code Ann. § 40-1-3:

§ 40-1-3. Voluntary transfers or charges.

Every transfer or charge which is not upon consideration deemed valuable in law shall be void as to creditors whose debts shall have been contracted at the time it was made; but shall not, upon that account merely, be void as to creditors whose debts shall have been con tracted, or as to purchasers who shall have purchased, after it was made; and though it be decreed to be void as to a prior creditor because voluntary, it shall not for that cause be decreed to be void as to subsequent creditors or purchasers.

. Set out in note³ supra.