- 16 -
petitioner’s counsel were aware that the pleadings and the
pretrial memorandum in this case and the District Court
litigation were totally inconsistent with petitioner’s present
argument that decedent had no ownership interest in the PCAB
shares. We also have no doubt that had petitioner amended the
pleadings in this case in order to take such a position, it would
have been prejudicial and possibly fatal to petitioner’s District
Court litigation.
We agree with respondent that petitioner first asserts the
ownership argument on brief.10 While this Court is seldom
inclined to consider an argument raised for the first time on
brief, there is no absolute rule barring such consideration. As
we said in Ware v. Commissioner, 92 T.C. 1267, 1268 (1989), affd.
906 F.2d 62 (2d Cir. 1990):
The rule that a party may not raise a new issue on
brief is not absolute. Rather, it is founded upon the
exercise of judicial discretion in determining whether
considerations of surprise and prejudice require that a
party be protected from having to face a belated
confrontation which precludes or limits that party’s
opportunity to present pertinent evidence. * * *
[Citations omitted.]
Every representation by petitioner, until the opening brief was
filed, had been that decedent was the owner or beneficial owner
of the redeemed shares. The Court’s pretrial order of July 15,
10We do not agree that petitioner’s “incomplete gift
argument”, which is based on alternative grounds of fraud, theft,
and mistake, is a new argument raised for the first time on
brief.
Page: Previous 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 NextLast modified: May 25, 2011