- 14 -
defenses, including estoppel, to be set forth in a party's
pleadings. Respondent, in violation of Rule 39, did not plead
judicial estoppel. Therefore, respondent cannot raise the
doctrine of judicial estoppel for the first time in her briefs.
Barbados #7 v. Commissioner, 92 T.C. 804, 813 (1989). However,
the purpose of the doctrine is to protect the courts, not the
parties. "The doctrine of estoppel is intended to protect the
courts rather than the litigants, so it follows that a court,
even an appellate court, may raise the estoppel on its own motion
in an appropriate case." In re Cassidy, 892 F.2d 637, 641 (7th
Cir. 1990) (fn. ref. omitted) (citing Allen v. Zurich Ins. Co.,
667 F.2d 1162, 1168 n.5 (4th Cir. 1982)). The United States
Court of Appeals for the Fifth Circuit acknowledged the right of
appellate courts to raise the doctrine of judicial estoppel but
reserved doing so "Absent a flagrant threat to the judicial
process". American Bank v. C.I.T. Constr., 944 F.2d 253, 258
(5th Cir. 1991). We have recently raised the doctrine of
judicial estoppel sua sponte in Shackelford v. Commissioner, T.C.
Memo. 1995-484. We conclude that the Court may consider the
issue of judicial estoppel in the present case.
Respondent argues that petitioners are judicially estopped
from arguing that the merged amounts are not taxable as
contributions in 1986 because, in Fazi I, petitioners
successfully asserted the position that the merged amount was
taxable prior to 1987. Petitioners argue that judicial estoppel
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