- 2 -
entering various purchasing contracts constitute income in the
year of receipt. All section references are to the Internal
Revenue Code in effect for the years in issue, and all Rule
references are to the Tax Court Rules of Practice and Procedure
FINDINGS OF FACT
Westpac is a general partnership whose principal offices
were located in Stockton, California, at the time the petition in
this case was filed.1 Westpac was formed for the purpose of
acquiring land, constructing a warehouse facility, and operating
such facility for the storage of food and other products sold to
the following three grocery store chains: Raley's Inc.
(Raley's), Save Mart Supermarkets, Inc. (Save Mart), and Bel Air
Mart, Inc. (Bel Air). Raley's and Save Mart each owned 45
percent of Westpac, and Bel Air owned the remaining 10 percent.
During the years in issue, Westpac used the accrual method of
accounting for tax reporting purposes.
GTE Sylvania Contract
On or about July 12, 1990, Westpac entered into an agreement
with Sylvania Lighting division of GTE Products Corp. (GTE
Sylvania) by which Westpac agreed to (1) make GTE Sylvania its
exclusive branded lamp supplier for Westpac and its member stores
for a 4-year term; (2) “aggressively and regularly” advertise and
1 Westpac changed its name from Westpac Pacific Foods to
Super Store Industries (SSI) at some point in 1991. For the sake
of convenience, references to Westpac include references to SSI.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011