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elderly father, raised crossbred cattle. In the early 1980's,
petitioners decided to breed purebred cattle and purchased a
registered purebred Black Brangus herd (Brangus herd) consisting
of 110 head of cattle. Between 1986 and 1989, as part of their
effort to breed purebred cattle, petitioners entered into an
artificial insemination program for their cattle.
Petitioners failed to make a profit on the purebred cattle
operation. In June 1989, petitioners sold their Brangus herd,
dismissed their ranch manager, and ceased the purebred cattle
operation on the Chireno ranch.
In 1991, petitioners decided again to raise crossbred
cattle. In September 1991, petitioners received 51 steers from
the Colorado ranch, see infra Colorado ranch, and maintained
these steers on the Chireno ranch. This number of steers was far
below the Chireno ranch’s capacity. Sometime between September
1991 and January 1992, petitioners’ Chireno ranch manager was
killed in a propane explosion. On January 11, 1992, because
petitioners had not hired a new ranch manager and they were
maintaining full-time medical practices, they sold the steers.
During the rest of 1992, 1993, and 1994, petitioners did not
raise, purchase, or maintain any cattle on the Chireno ranch.
During that time period, Elzie Smith (Mr. Smith), who had bailed
hay prior to 1992 on the Chireno ranch for petitioners, performed
general maintenance work on the Chireno ranch in addition to
bailing hay. He maintained the fences and cared for the pastures
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