- 12 -
within the rule of Celotex,19 by arguing that "respondent has
offered not a shred of evidence to oppose petitioner's motion".
Petitioner's assertion that at trial respondent must prove
fraud by clear and convincing evidence is correct. Rule 142(b);
sec. 7454(a); Stone v. Commissioner, 56 T.C. 213, 220 (1971).
Furthermore, petitioner is correct in stating that unless
respondent proves petitioner's fraud, the statute of limitations
precludes the assessment of any deficiency for tax year 1982.
Sec. 6501(a), (c)(1). It is also true that as part of her burden
in the trial of a fraud case, respondent must first prove an
underpayment of some amount of tax. Sec. 6653(b). As this Court
has recognized, "Absent an underpayment, there is nothing to
which the fraud addition may attach." Apothaker v. Commissioner,
T.C. Memo. 1985-445; Hebrank v. Commissioner, 81 T.C. 640, 642
(1983) (first element to be established is an underpayment of
tax). In opposing this motion, respondent stressed the intent
element and ignored the underpayment element of fraud.
Nevertheless, respondent and petitioner have filed with the Court
stipulated facts and documents related to both elements.20
19See also Anderson v. Liberty Lobby, Inc., 477 U.S. 242
(1986) for a description of the nonmoving party's burden of proof
once the moving party has made a proper showing under the rule of
Celotex Corp v. Catrett, supra.
20Petitioner's written submissions and oral argument at the
hearing on this motion suggest that the documents and facts
stipulated by the parties are not to be considered as "evidence"
or "facts" presented by respondent. Petitioner cannot seriously
(continued...)
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