- 9 -
must then decide whether to grant petitioners' motion for summary
judgment.
I. Motions to Amend the Pleadings
Rule 41(a) provides in pertinent part that
A party may amend a pleading once as a matter of
course at any time before a responsive pleading is
served. * * * Otherwise a party may amend a pleading
only by leave of Court or by written consent of the
adverse party, and leave shall be given freely when
justice so requires.
Whether a motion seeking amendment should be allowed lies within
the sound discretion of the Court. Rule 41(a); Law v.
Commissioner, 84 T.C. 985, 990 (1985).
In determining the justice of a proposed amendment, we must
examine the particular circumstances in the case before us. Law
v. Commissioner, supra at 990. We consider, among other factors,
whether an excuse for the delay exists and whether the opposing
party would suffer unfair surprise, disadvantage, or prejudice if
the motion to amend were granted. Id.; Nolte v. Commissioner,
T.C. Memo. 1995-57, affd. without published opinion 99 F.3d 1146
(9th Cir. 1996); Estate of Ravetti v. Commissioner, T.C. Memo.
1992-697; Spain v. Commissioner, T.C. Memo. 1978-270.
A. Respondent's Motion for Leave To File Amendment to
Answer
Respondent first seeks leave to amend the answer to allege
that petitioners' distributive share of partnership losses should
be recharacterized as passive losses for purposes of section 469
(the section 469 issue), and that such recharacterization
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011