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On the basis of Sullivan--a decision that did not announce a new
rule of law--respondent argued in his reply brief that the United
Ready Mixed settlement proceeds should be taxed as income to
petitioner in 1992.14
Respondent also argues that “Petitioner is not harmed by
respondent’s change in position as respondent’s new position is
consistent with petitioner’s own treatment of the proceeds on his
1992 return”. We disagree with respondent’s statement.
Petitioner may have relied on respondent’s trial and briefing
concession in failing to introduce evidence and submit argument
to support a deduction for amounts paid to his attorney and
placed in trust in 1992 pending resolution of the attorney’s-fee
dispute. Respondent’s change of position after trial created new
legal and factual issues; petitioner did not have an opportunity
to introduce evidence on these new issues because respondent did
not change his position until after the trial was completed.
We have refused to allow the Commissioner to withdraw
factual concessions after trial where there would be prejudice to
the opposing party. See Glass v. Commissioner, T.C. Memo.
1988-550 (“In his brief, respondent seeks to withdraw the
concession. We are not inclined to accept such withdrawal,
14In his reply brief, respondent states: “In light of
Sullivan, respondent hereby changes the position taken in his
opening brief, and asserts that petitioner received taxable Ready
Mixed settlement proceeds in the amount of $797,225.00 in 1992,
the year such proceeds were deposited into Lurie and Zepeda’s
client trust fund.”
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