-73-
fair market value of the new trucks that its subsidiary acquired
from those companies. Id. In negotiating the foregoing
transactions with G.M.C. and White, Charles E. Mendez (Mendez),
the president and chairman of the board of both the taxpayer and
its subsidiary, did not indicate to either G.M.C. or White which
corporation he was representing, and it made no difference to
G.M.C. or White whether they were dealing with the taxpayer or
with its subsidiary. Id. Both the taxpayer and its subsidiary
used the same address on the checks utilized in the transactions
in question even though they were located in different cities in
Florida and even though the taxpayer's subsidiary used a
different bank account for all of its business activities. Id.
G.M.C. and White delivered most of the trucks acquired in the
alleged purchases by the taxpayer's subsidiary directly to the
taxpayer even though they were ostensibly being sold to that
subsidiary for resale to the taxpayer. Id.
In addition to reciting the foregoing facts in Redwing
Carriers, Inc. v. Tomlinson, supra, the Court of Appeals for the
Fifth Circuit observed that "a definite contractual inter-
dependency between the sale of new trucks and the trade-in of old
trucks" existed, id., in that there "would have been no purchase
by * * * [the taxpayer's subsidiary] of new trucks or tractors
without concurrent and binding agreements to purchase * * * [the
taxpayer's] used equipment", id. (quoting the U.S. District
Court's opinion in Redwing Carriers, Inc. v. Tomlinson, 19 AFTR
Page: Previous 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 NextLast modified: May 25, 2011