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without the consent of the other if sufficient grounds exist".
Id. at 181-182. As more fully set forth hereinafter, petitioner,
on December 28, 1989, through Merrill Lynch, "reacquired" 96,600
shares of WalMart stock. Petitioners assert that their
"repurchase" of shares put them in all material respects in the
same position they occupied in January 1989. They contend that
the "sufficient grounds" for rescission with Merrill Lynch are
either mutual mistake or conversion.
Petitioner attempted to bring himself within the first
situation described in Rev. Rul. 80-58, supra, to reflect a
rescission to the extent of 96,600 of the 100,000 shares sold on
January 3, 1989, by having Merrill Lynch purchase for him 96,600
shares of WalMart on December 28, 1989. He wanted Merrill Lynch
to report to the IRS on Form 1099 a sale of only 3,400 shares for
1989. However, the record indicates that Merrill Lynch was
advised by tax experts not to change Form 1099 to reflect a
rescission, and was warned by the tax experts that it "could be
subject to civil and possibly criminal sanctions by the IRS if it
did so." Nevertheless, Merrill Lynch agreed to help petitioner
"repurchase" 96,600 shares in his attempt to claim the benefits
of Rev. Rul. 80-58, supra, but made no representation as to what
effect such "repurchase" might have. In a letter to petitioner's
lawyer, Merrill Lynch's counsel stated that it "is merely
treating this as a customer who is purchasing shares in his
account." However, because it would be assisting in the
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