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deficiency determination. The estate’s counsel agreed to this
terminology and should not now be allowed to prevail on a claim
that the terms as used in this agreement have different meanings.
This Court typically treats closing agreements, stipulations of
fact, and settlements as contracts, holding parties to their
terms. Johnston v. Commissioner, 122 T.C. 124 (2004)
(stipulations); Zaentz v. Commissioner, 90 T.C. 753 (1988)
(closing agreements); Stamm Intl. Corp. v. Commissioner, 90 T.C.
315 (1988) (settlements). I see no reason to deviate from that
practice in this case and would hold that agreements under Rule
155 should be just as binding.1
The majority doesn’t dispute that the parties’ computation
under Rule 155 should be binding on them, but it then chooses to
resolve the dispute over its meaning quite unlike other courts
would. When a legitimate question is raised about the meaning of
an ambiguous term in a contract, courts will usually rely on
evidence of what the parties intended. “If * * * a court refuses
to consider evidence of particular meanings attached by the
contracting parties, the court may discover a contract that
neither party intended.” Murray, Murray on Contracts, 1-5 sec.
86 (2001). That is just what has happened here, with the
1 As Judge Goeke convincingly demonstrates, the parties so
obviously agreed what the term meant that respondent allowed the
estate a deduction for the accrued but unpaid interest that was
shown in the computation.
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