- 30 -
Thus, whatever advice petitioner may have received from Mr. Pace
fails as a defense to negligence because of Mr. Pace’s lack of
competence to give such advice and the clear presence of a
conflict of interest. See Goldman v. Commissioner, 39 F.3d at
408; LaVerne v. Commissioner, 94 T.C. 637, 652-653 (1990), affd.
without published opinion 956 F.2d 274 (9th Cir. 1992); Rybak v.
Commissioner, 91 T.C. 524, 565 (1988); Barlow v. Commissioner,
T.C. Memo. 2000-339; see also Weitzman v. Commissioner, T.C.
Memo. 2001-215, wherein we stated that “The fact that * * * [the
putative adviser] introduced the partnership investment to
petitioner should have put petitioner on guard that * * * [the
putative adviser] was engaged in selling rather than acting as an
independent adviser.”
Petitioner also contends that he reasonably relied on advice
from Mr. Jacobs. At the time of trial, Mr. Jacobs was deceased;
accordingly, we do not know first hand what knowledge he may have
had or what advice he may have given. The record does establish
that Mr. Jacobs only became interested in the farming of jojoba
in 1982, so his experience was limited, and he did not have any
experience or expertise in the research or development of jojoba.
See Freytag v. Commissioner, 89 T.C. at 888. The record also
establishes that Mr. Jacobs was involved in the sale of limited
partnership interests in a number of jojoba partnerships.
Accordingly, any advice that he may have given can be analogized
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