- 81 -
benefits of net operating losses arising in consolidated return
periods:
Each corporation then had a bargaining position.
The stakes were high. Neither could win them alone,
although each had an indispensable something that the
other was without. It was as if a treasure of
seventeen million dollars were offered * * * to whoever
might have two keys that would unlock it. Each of
these parties had but one key, and how can it be said
that the holder of the other key had nothing worth
bargaining for?
The tax position of Mr. Kenseth is stronger than that of
either claimant in the Western Pac. R.R. case. Justice Jackson’s
reference to the “treasure” is to a static, fixed, pre-determined
amount, the tax benefit from the net operating losses. When
attorney and client enter a contingent fee agreement, the amount
of the ultimate recovery is unknown; the recovery is determined
in a dynamic process in which the exercise of the experience and
skill of the attorney results both in some recovery and in an
increase in the value of that recovery. The attorney creates and
adds value; the efforts of the attorney contribute to--indeed he
may be solely responsible for--both the recovery and its
augmentation. Attenuated subtleties and refinements of title
have nothing to do with the practical realities of contingent fee
agreements and the relative interests of attorney and client in
any recovery that may ultimately be realized.
Page: Previous 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 NextLast modified: May 25, 2011