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1996, respondent filed her response. Respondent principally
argues that petitioners are bound by the stipulation, and the
objections raised in petitioners' above-referenced response
amount to new issues that are not now before the Court.
Respondent, however, concedes petitioners' sales tax argument.
Discussion
The general principles of contract law govern the compromise
and settlement of tax cases. In essence, settlement stipulations
are contracts, and this Court is bound to enforce them. Stamos
v. Commissioner, 87 T.C. 1451, 1454 (1986). During the process
of negotiation, each party agrees to concede rights that may be
asserted against his or her adversary as consideration for those
secured in the agreement. Saigh v. Commissioner, 26 T.C. 171,
177 (1956). We enforce settlement stipulations unless justice
requires otherwise. Adams v. Commissioner, 85 T.C. 359, 375
(1985); Saigh v. Commissioner, supra. We also enforce
stipulations where the parties agree to be bound by the outcome
of a test case. Hillman v. Commissioner, T.C. Memo. 1982-468.
In determining the proper meaning of the terms of settlement, we
look to the language of the stipulation and the circumstances
surrounding its execution. Robbins Tire & Rubber Co. v.
Commissioner, 52 T.C. 420, 435-436 (1969).
Petitioners ask the Court to instruct respondent to prepare
a decision document that reflects their argument regarding an
investment tax credit. We decline to do so because the
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