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that the moment is determined by applying a facts and
circumstances analysis. On the basis of the following facts,
respondent contends that a reasonable person could conclude that
no expectation of repayment remained after petitioner’s refusal
to pay in 2000, and, consequently, that respondent’s position was
substantially justified: (1) A “unique relationship” existed
between petitioner and CareMatrix as demonstrated by the loan to
cover petitioner’s income tax liability; (2) the terms of the
loan documents on their face provide for a recourse liability;
(3) petitioner had made no payment as of April 15, 2000; (4)
petitioner abandoned the collateral in 2000; (5) CareMatrix took
no action to collect the liability in 2000, either by selling the
collateral or by commencing an action against petitioner,5 and
(6) nearly 4 years passed from the date on which the promissory
note became due and payable until the date on which respondent
issued the notice of determination.
5Specifically, respondent’s response to the instant motion
states that respondent’s position was substantially justified on
the basis of, inter alia, the following facts:
f. The note became due in 2000, [petitioner] did
not perform on the note, and [CareMatrix] did not take
advantage of any of the aforementioned recourse
provisions available to it.
g. Upon petitioner’s default, [CareMatrix] did not
foreclose or otherwise take legal title in the
collateral.
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Last modified: May 25, 2011