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is unambiguous and provides for guaranteed payments which survive
decedent’s death and are includable in the gross estate.
The parties presented arguments on brief regarding whether
we should apply the rule enunciated in Commissioner v. Danielson,
378 F.2d 771 (3d Cir. 1967), vacating and remanding 44 T.C. 549
(1965),9 or the less stringent “strong proof” rule.10 However,
the Danielson rule and the strong-proof rule apply only in the
case of an unambiguous agreement. See Gerlach v. Commissioner,
55 T.C. 156, 169 (1970); Pettid v. Commissioner, T.C. Memo. 1999-
126. Because we find the terms of the marital settlement
ambiguous, we do not apply either the Danielson rule or the
9The Danielson rule provides:
a party can challenge the tax consequences of his
agreement as construed by the Commissioner only by
adducing proof which in an action between the parties
to the agreement would be admissible to alter that
construction or to show its unenforceability because of
mistake, undue influence, fraud, duress, etc. * * *
[Commissioner v. Danielson, 378 F.2d 771, 775 (3d Cir.
1967), vacating and remanding 44 T.C. 549 (1965).]
10Under the strong-proof rule, a taxpayer can ignore
unambiguous terms of a binding agreement only if he presents
“strong proof”, that is, more than a preponderance of the
evidence that the terms of the written instrument do not reflect
the actual intentions of the contracting parties. Elrod v.
Commissioner, 87 T.C. 1046, 1066 (1986). This Court generally
applies the strong-proof rule. See id. at 1065; Coleman v.
Commissioner, 87 T.C. 178, 202 (1986), affd. without published
opinion 833 F.2d 303 (3d Cir. 1987); Ullman v. Commissioner, 29
T.C. 129 (1957), affd. 264 F.2d 305 (2d Cir. 1959). However, if
the case is appealable to a circuit which has adopted the
Danielson rule, then we are bound to apply that rule. See Golsen
v. Commissioner, 54 T.C. 742, 756-757 (1970), affd. 445 F.2d 985
(10th Cir. 1971).
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