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presented at trial. Thus, even if not specifically
raised in the pleadings, the matter has been tried by
the implied consent of the parties. T.C. Rule 41(b).
Rule 41(b) states that “When issues not raised by the
pleadings are tried by express or implied consent of the parties,
they shall be treated in all respects as if they had been raised
in the pleadings.” In the instant case, respondent admits that
the issue of whether Russell withdrew cash in excess of his basis
was not specifically raised in the pleadings. However, the
evidence reflects that both parties were aware, before trial,
that respondent was pursuing this alternative argument.
Respondent alleges that, before trial, he repeatedly requested
information from Russell regarding his basis in BBP. This
allegation is supported by respondent’s interrogatories to
Russell which requested information necessary to calculate
Russell’s basis in BBP during the years in issue and by Mr.
Feldmann’s testimony at trial that an agent of respondent brought
up the issue of Russell’s basis in BBP during the audit process.
Additionally, respondent’s trial memorandum lists one of the
issues in this case as:
Whether Russell Ballantyne had additional income in
1994 from the sale of grain in the amount of
$751,988.00. Alternatively, whether Russell Ballantyne
received a distribution from BBP in 1994 that exceeded
his basis in the partnership by $751,988.00.
Russell’s trial memorandum states that “Russell Ballantyne has
sufficient basis for his withdrawal of grain income.” Russell
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