Washoe Ranches # 1, Ltd. Washoe Ranches #2, Ltd., Washoe Ranches #3, Ltd., Washoe Ranches #4, Ltd., Washoe Ranches #5, Ltd., Washoe Ranches #6, Ltd., Washoe Ranches #7, Ltd., Walter J. Hoyt III, - Page 13

                                       - 13 -                                         
          trying to draft a document for the basis of settlement.  We find            
          that, although the agreement does not provide a specific method             
          of payment on the notes, the parties have stipulated that the               
          payments were made by the transfer of cattle.                               
               Ordinarily, a stipulation of fact is binding on the parties,           
          and the Court is constrained to enforce it.  Rule 91.  The Court            
          will not permit a party to a stipulation to qualify, change, or             
          contradict the stipulation except where justice requires.  Rule             
          91(e).  The interpretation of a stipulation is determined                   
          primarily by ascertaining the intent of the parties by applying             
          rules of contract law.  Stamos v. Commissioner, 87 T.C. 1451,               
          1455 (1986).                                                                
               As we understand petitioner's argument, he claims that the             
          "cattle" transferred in payment on the notes as stipulated were             
          not culled cows or calves but were registered shorthorn heifers             
          and, therefore, not covered by the agreement.  Petitioner argues            
          that there is no gain to be recognized from the transfers because           
          the Bales decision does not apply to this class of cattle.  We              
          disagree.                                                                   
               Petitioner has stipulated that the cattle transferred had a            
          zero basis.  Thus the transfers result in ordinary income to the            
          partnerships regardless of whether the cattle are heifers or                
          culled cows and calves.  A stipulation may be set aside where it            
          is clearly contrary to the facts disclosed on the record.  Cal-             
          Maine Foods, Inc. v. Commissioner, 93 T.C. 181, 195 (1989).  The            




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