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acceptances were based on the understanding that the settlement
offer was applicable as a package to all years in which taxpayers
had Arbitrage Management investments. Settlement offers made and
accepted by letters have been enforced as binding agreements. See,
e.g., Haiduk v. Commissioner, T.C. Memo. 1990-506. Petitioners
reached the settlement agreement, which we conclude under the
circumstances of this case is a binding contract, no later than
January 21, 1988. See, e.g., Robbins Tire & Rubber Co. v.
Commissioner, 52 T.C. 420, 435-436 (1969).
The joint status reports to the Court after the January 1988
settlement confirmed the parties' understanding that the settlement
offer applied to both docketed and nondocketed years. In addition
to the documentary evidence, Mr. Nolan, Ms. Kaplan, and Mr. Janow
also testified that the Arbitrage Management settlement was
intended to apply to all years in which there were Arbitrage
Management investments, both docketed and nondocketed. Messrs.
Kletnick and Berman also testified to this effect ("we agreed to
structure the settlement to encompass all years." "The basis for
settlement acceded to Mr. Nolan's request that it cover all years.
* * * What the negotiators wanted was a general framework that
encompassed all years and we agreed to that.").2 Assuming Mr.
2 We note that even respondent's counsel conceded that
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