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of Alaska testified that she viewed the settlement as a compromise
of property-based claims.
From the face of the release agreement we are unable to
ascertain whether the settlement was made on account of tort type
personal injuries or in claims grounded elsewhere; the release
agreement purports to release defendants from “all actions, causes
of action, suits, controversies, claims, and demands of every kind
and nature”. Nor are we able to discern from the face of the
release agreement the intent of the parties in reaching the
agreement; the release agreement provided “it is the intention of
the parties released * * * and it is the purpose of this agreement,
to discharge absolutely the liability of the parties * * * from any
and all the aforementioned claims”. Accordingly, we must analyze
the nature of the underlying claims.
First, we address whether the settlement was made on account
of tort or tort type rights. This analysis requires us to focus on
the scope of remedies available. See Cade v. Commissioner, T.C.
Memo. 1999-394. “A ‘tort’ has been defined broadly as a ‘civil
wrong other than breach of contract, for which the court will
provide a remedy in the form of an action for damages.’” United
States v. Burke, 504 U.S. 229, 234 (1992) (quoting Keeton et al.,
Prosser & Keeton on the Law of Torts 2 (5th ed. 1984)). Such
action for damages is generally compensatory in nature. See id. at
235.
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