Of all of the blog joints in all the towns in all the world, you had to click onto mine… Yeah, I know it’s bad but I couldn’t resist. It’s Casablanca. How can I be expected to write about a movie with such a classic line and not butcher it somehow?
Today, I’m tackling the 1943 Oscar winner for Best Picture: Casablanca. The movie also picked up awards for Directing for Michael Curtiz and Adapted Screenplay for Julius J. Epstein, Philip G. Epstein and Howard Koch. It is consistently ranked by the American Film Institute as one of the top movies of all time. And it’s one of my favorites. I, like almost every other woman in America (and men, too, admit it) bawled like a baby the first million times that I watched it.
The movie focuses on Rick Blaine (played by Humphrey Bogart, an Oscar nominee for the film), a cynical American expatriate living in World War II Casablanca. Blaine owns Rick’s Café Américain, the most popular nightclub in the city.
We don’t know much about Blaine to begin with – he keeps his secrets close. We do know that he claims that he cannot return to the United States but the reason is not clear.
From a tax perspective, it’s important to remember that US citizens who do not renounce their citizenship are still required to file and pay taxes on their worldwide income – this would include salaries, gambling winnings (since Rick’s Café Américain is a gambling club) and earnings from business investments. Foreign tax credits are generally available for those that must pay taxes to a foreign government. Certain countries have tax treaties that may override these provisions or exempt certain income; however, the US did not enter into a tax treaty with Morocco until 1977.
Things are shaken up when Ugarte (played by the ubiquitous character actor Peter Lorre) arrives in Rick’s club with “letters of transit” that he obtained by killing two German couriers. These letters are valuable because they allow free transit within Europe. This means that those stranded in Casablanca due to the war can travel to a neutral port and thus, enter the United States. Ugarte expects to sell the letters for loads of money. I am not sure how Morocco taxes “ill gotten gains” from crimes, but if Ugarte resided in the US or had been a citizen of the US, he would have been responsible for reporting the income from the sale of the stolen property on his tax return.
Unfortunately for him, Ugarte is arrested by Captain Louis Renault (played by serial groom Claude Rains), who eventually has Ugarte killed. Renault is working with the Germans – more or less. He believes that Ugarte is in possession of the letters; what he doesn’t know is that Blaine is holding the letters for safekeeping. Merely holding the letters does not make Blaine the owner for tax purposes – he’s acting more like a trustee. There are, therefore, no tax consequences to him for retaining possession of the letters.
Victor Laszlo (played by actor turned director Paul Henreid), an anti-Nazi leader in the resistance, appears at Rick’s Cafe to buy the letters. Only, he doesn’t come alone. He brings along his wife, the beautiful Ilsa Lund (played by the fabulous multi-award winning actress, Ingrid Bergman, who surprising did not get an Oscar nod for the role).
Lund and Blaine share a torrid history. Years before, Lund and Blaine had been lovers in Paris when Lund believed that her husband had been killed in the war. When she found out that Laszlo was still alive, she left Blaine without explanation and was reunited with her husband. She never explained to Blaine what happened, which left him bitter.
So, what happens from a tax perspective if you think your spouse is dead? This is one of those crazy bits in the law that is extremely fact and circumstances specific. In most states, there is a “presumption of death” statute that more or less allows you, in the face of no contrary evidence, to assume a death when more than two years have passed and the circumstances support the presumption. After 9/11, many states implemented specific rules that allowed for acceleration of the presumption if the purported decedent was alleged to have been in the World Trade Center or otherwise involved in the tragedies. It would be interesting to find out what happens if the statute runs, the presumption is made and the “decedent” later turns up alive… Do you file for refund for estate and inheritance taxes? Do you return life insurance money? Do you retroactively file your income taxes as married? You can certainly see why the presumption usually requires more than one year of alleged death.
Eventually, Laszlo realizes that Blaine knows a great deal about the letters. He and Blaine argue over them while at Rick’s. Also at Rick’s that night is a group of German soldiers who, while drinking, begin to sing a German song. The crowd, in response and led by Laszlo, drowns them out with the French national anthem. Incensed, the German soldiers order Renault to close Rick’s down. Renault obliges.
Lund realizes that Rick has the letters and intends to get them from him. She holds him hostage at gunpoint and threatens to kill him if he doesn’t turn the letters over. Blaine doesn’t believe her – and rightfully so. She can’t shoot him and instead, confesses that she still loves him.
Still angry that Laszlo incited the crowd to sing the French national anthem, the Germans have Renault arrest Laszlo on a trumped up charge. Blaine, who realizes that it is a bogus charge, asks Renault to let him go. In return, Blaine says that he can have Laszlo arrested for a more serious crime, by planting the letters on him. When Renault lets Laszlo go, Blaine does plant the letters on Laszlo – but not to set him up. Instead, he sets him free by giving him the letters and telling him to board the plane and use the letters to escape.
Earlier, I pointed out that Blaine was acting almost like a trustee with respect to the letters. As trustee, he would have been held to a fiduciary duty to protect the letters (which had considerable value). But this is where everything gets a little hazy. In practice, the property is stolen and should be returned to its rightful owners. The “owners” of the property are all dead – first, the German couriers and then Ugarte. Who now owns the letters? Should Blaine return the letters to the Nazis? Is that the legal – if not the moral – answer? What if Blaine doesn’t believe that the Nazis are the proper legal authorities? Clearly, Renault – the closest thing to Moroccan authority – is not above board. Is it then “legal” to turn the letters over to the resistance? And does Laszlo fit that bill, since he’s a leader of the resistance but clearly acting, in this instance, for personal reasons?
The answer lies, really, in unraveling who owns the letters. The tax liability should follow the owner. But the matter of whether the letters were converted versus gifted is a significant one – and one that I can’t really make heads or tails of!
Despite who really should own the letters, they are now in Laszlo’s hands. Blaine insists that Lund go with Laszlo. When she hesitates, wondering if she should stay behind with Blaine, he tells her that he knows she would regret it “[m]aybe not today. Maybe not tomorrow, but soon and for the rest of your life.”
Even in the midst Blaine’s trickery, Renault has great respect for him. He plays dumb when the Germans arrive, suggesting that the whole fiasco was probably the work of one of the many criminals that hang around Casablanca.
Blaine and Renault then walk out into the fog (and out of Casablanca?) with Blaine saying that this might be “the beginning of a beautiful friendship.”
The movie was nominated for review by Mary Jo. Remember that your comments will count as votes for Mary Jo – and she can win some great prizes. So tell me what you think about the movie, the review, the locale… Is the acclaim deserved?