Norman L. and Catherine J. Forste - Page 36

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          tort or tort type claims for personal injury.  Pursuant to the              
          definition of credible evidence contained in the legislative                
          history of section 7491(a)(1), our finding that petitioners have            
          presented credible evidence is made before considering any                  
          contrary evidence submitted by respondent.  We therefore hold               
          that pursuant to section 7491, the burden of proof on whether               
          $25,130 from DHS was received on account of a tort or tort type             
          claim for personal injury shifted to respondent.                            
          IV.  Respondent Failed To Meet Burden of Proof                              
               After petitioners presented their case, respondent called              
          only one witness, Mr. Ladd.  Mr. Ladd negotiated the Forste                 
          settlement on behalf of DHS.  Mr. Ladd was in charge of human               
          resources for DHS and was its national personnel partner.  He was           
          in charge of the retirement and severance pay issues that                   
          resulted from DHS’s decision to terminate the employment of                 
          partners and directors in 1985.  On the other hand, Mr. Forste’s            
          situation involving tort and tort type personal injury claims was           
          unique to Mr. Forste.  Nevertheless, Mr. Ladd had almost no                 
          recollection of the reasons for the critical language in the                
          various proposed drafts and the final settlement document in Mr.            
          Forste’s case.  Mr. Ladd’s failure to recall the circumstances              
          and whether DHS intended to compensate Mr. Forste for personal              
          injury claims might raise an inference that DHS’s reason for                
          entering into the agreement was no different than DHS’s reasons             






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