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Petitioners’ claim is that the Bell payments were for
services. The issue in the State court was whether Bell had
committed acts of theft, fraud, and breach of fiduciary duty
against decedent. The State court found that she had not and,
although the State court found that the payments there in
question were gifts, the State court did not have before it the
question of whether the payments were gifts or, alternatively,
for services. It was not "essential" for the State court to find
that the payments there in question were gifts for it to find
that Bell had neither stolen anything from decedent nor breached
a fiduciary duty. Because the issue in this case was not
actually litigated in the State court, collateral estoppel is
inapplicable, and petitioners are not estopped from denying that
the Bell payments were gifts.
III. The Bell Gifts
A. Introduction
Decedent kept handwritten journals showing his personal
expenditures (the ledgers). The ledgers show the Bell payments,
and, from the Bell payments, respondent calculated the Bell
gifts. Petitioners concede that some of the Bell gifts are,
indeed, gifts (i.e., those specifically annotated as birthday
gifts, Valentine’s Day gifts, or gifts for other special
occasions). Petitioners maintain that the remainder of the Bell
gifts (the contested Bell gifts) are not gifts but reimbursements
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