Estate of Lloyd P. Cavett - Page 14




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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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