- 25 -
rental business and that any services they provide and any
portion of the list rental payment received by them for the
rental of petitioner's list should be attributed to petitioner
for purposes of calculating petitioner's UBTI. Petitioner argues
that the list brokers are independent contractors and that the
services they provide, and any compensation they receive for such
services, should not be attributed to petitioner.
As to whether an agency relationship exists, the manner in
which the parties to an agreement designate their relationship is
not controlling. See Board of Trade v. Hammond Elevator Co., 198
U.S. 424, 437 (1905). Rather, the question of agency is based on
the surrounding facts and circumstances of each case. See id.
(citing Connecticut Mut. Life Ins. Co. v. Spratley, 172 U.S. 602,
617 (1899)). "An essential characteristic of an agency
relationship is that the agent acts subject to the principal's
direction and control." In re Shulman Trans. Enters., Inc., 744
F.2d 293, 295 (2d Cir. 1984). "[A]n independent contractor can
be an agent if, and to the extent that, the contractor acts for
the benefit of another and under its control in a particular
transaction." State Police Association v. Commissioner, 125 F.3d
1, 7 (1st Cir. 1997), affg. T.C. Memo. 1996-407; see also
National Collegiate Athletic Association v. Commissioner, 92 T.C.
Page: Previous 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 NextLast modified: May 25, 2011