- 14 - Compensation. Petitioner was only a party to the 11 franchise agreements under which petitioner operated its stores and was required to pay a 5.5-percent royalty fee. It is not clear that the fact that Domino's, a third party, chose to treat petitioner and Pizza Park as members of one "group"--the "Paul Group"--for one purpose otherwise affected the rights and obligations of petitioner (and its shareholders) and Pizza Park (and its shareholder) for other purposes. Petitioner was a separate corporate entity possessing a different identity from Pizza Park and Mr. Paul. Petitioner was not solely owned by Pizza Park or Mr. Paul but was also owned by Mr. Brown, a 49 percent shareholder. There was no reason for respondent to conclude that Mr. Brown would be willing to allow petitioner to pay dividends to Mr. Paul without making appropriate adjustments on its corporate books. Nor was there any indication that petitioner's corporate identity was in any manner ignored. Finally, petitioner appropriately filed Forms 1099 reporting the payments made to Mr. Paul. Therefore, respondent has failed to establish that respondent reasonably determined petitioner to be the implied assignee of the Area Agreement. Second, even if petitioner impliedly become an assignee of the Area Agreement, the right to receive the Compensation was notPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Next
Last modified: May 25, 2011