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refunds. We shall therefore enter decision in accordance with
the stipulation of settled issues that petitioner agreed to.
Collateral Estoppel
Petitioner argues that respondent is collaterally estopped
by the bankruptcy court’s opinion for the taxable year 1985 from
litigating whether the tentative refunds for taxable years 1981
and 1984 were “rebates” within the meaning of section 6211(b).6
We disagree. In the discussion of estoppel issues that follows,
we will have primary recourse to opinions of the Court of Appeals
for the Seventh Circuit, to which an appeal in the case at hand
would ordinarily lie.
“Collateral estoppel, also called ‘issue preclusion’, refers
to the simple principle that later courts should honor the first
actual decision of a matter that has been actually litigated.”
Chicago Truck Drivers v. Century Motor Freight, Inc., 125 F.3d
526, 530 (7th Cir. 1997) (citing 18 Wright et al., Fed. Prac. P.,
sec. 4416, at 136 (1981 & Supp. 1997)). The doctrine ensures
that the determination of an issue by a court of competent
jurisdiction will be conclusive in subsequent suits. Id.
Collateral estoppel applies when (1) the issue sought to be
precluded is the same as in the prior action; (2) that issue was
actually litigated; (3) the determination of the issue was
6Petitioner does not argue the preclusive effect of
Interlake Corp. v. Commissioner, 112 T.C. 103 (1999).
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