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and not founded on a promise or agreement are deductible from the
gross estate regardless of the ability to show consideration.
Sec. 20.2053-4, Estate Tax Regs.
A claim founded on a divorce decree is a liability imposed
by law and deductible without regard to the limitations of
section 2053(c)(1)(A). See Harris v. Commissioner, 340 U.S. 106
(1950); Estate of Robinson v. Commissioner, 63 T.C. 717 (1975).
Petitioner asserts that the claim of the Edwards children is
founded on the divorce decree and is therefore deductible as a
claim imposed by law.2 Respondent disagrees, arguing that the
claim is founded on the 1970 PSA, not the divorce decree.
In order for the claim to be imposed at law, the divorce
decree, rather than the agreement between the parties, must be
the "operative element" of a claim. Estate of Satz v. Commis-
sioner, 78 T.C. 1172, 1179 (1982). Whether the divorce decree is
the "operative element" depends upon whether the divorce court
has the power to vary the terms of the agreement between the
parties--here the rights of the Edwards children vis-a-vis the
stock. Harris v. Commissioner, supra at 109-110; Estate of
Fenton v. Commissioner, 70 T.C. 263, 271-274 (1978). If the
divorce court has the power to prescribe a property settlement
2Petitioner also asserts that the Edwards children's claim
is supported by full and adequate consideration. At the hearing,
the parties indicated that more facts needed to be developed
before this alternative theory would be ripe for summary judg-
ment. Consequently, we offer no opinion as to whether the
Edwards children's claim is supported by adequate consideration.
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