Annotations 05/2010

(due to lack of quorum, court upholds trial court determination that plaintiffs lacked standing to bring public nuisance claim against defendants (oil industry, chemical companies and utilities) on basis that defendants' production activities contributed to "global warming" which, plaintiffs claimed, worsened impact of Hurricane Katrina; causal connection tenuous at best).

(would repeal the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010; would enact H.R. 4038, the “Common Sense Health Care Reform and Affordable Act as initially introduced on November 6, 2009; bill has 30 co-sponsors).  

(deed not set aside due to lack of evidence supporting rescission of deed). 

(court upholds penalty period imposed on Mecaid applicant's eligibility for benefits due to estranged wife's purchase of annuity that did not name state as remainder beneficiary). 

(contract case involving construction of wind power station; battle is between "renewable energy" company and a financier of the proposed project; case largely procedural). 

(payments for life insurance premiums not deductible; payments made to welfare benefit plans). 

(plaintiff, sole owner of S corporation CPA firm, paid a $24,000 salary and treated remaining $180,000 of annual income as S corporation K-1 income (not subject to FICA tax at 15.3 percent up to $106,800 (for 2010), and 2.9 percent Medicare tax on all income); plaintiff's motion for summary judgment denied - intent to pay compensation is to be determined based on a facts and circumstances test rather than self-serving assertions of proprietor; case arose based on examination into firm's potentially underpaid employment taxes).

(manure agreement that parties entered into not ambiguous and intended to be discretionary; defendant had the right, but was not required to provide plaintiff with manure on the real estate subject to the agreement). 

(payments that cooperative makes to farmers for grain sales constitute per-unit retains paid in money (PURPIM); consequently, cooperative's DPAD to be computed without deducting the PURPIMs). 

(debtor need not turn over entire joint tax refund to bankruptcy estate; refund did not result only as a result of taxes withheld from taxpayer's income; thus, court had to calculate amounts allocable to estate and to non-debtor spouse). 

(plaintiffs motion for summary judgment seeking to quiet title to mineral rights acquired through tax deeds denied). 

(plaintiffs, pro-se organic dairy farmers sued defendant for defendant's alleged unlawful application of pesticides on neighboring farm that drifted onto plaintiffs' organic crops; plaintiffs' claim that defendant violated 7 U.S.C. Sec. 136 et seq. dismissed because FIFRA does not provide for private right of action to farmers or others injured as a result of pesticide manufacturer's violation of FIFRA;s labeling requirements, but trial court needed to have dismissed claim for failure to state claim upon which relief may be granted rather than on grounds that court lacked subject matter jurisdiction). 

(Federal EPA admits that total maximum daily load limits (TMDLs) for the water of the District of Columbia were improperly expressed as "seasonal" or "annual" rather than "daily"; appropriate remedy is to permit EPA an opportunity to correct deficient TMDLs).

(trial court order enforcing oral settlement agreement requiring plaintiff to buy real estate from defendant affirmed; partial performance made settlement agreement enforceable despite the statute of frauds not being satisfied). 

(Chapter 12 bankruptcy case involving professional fee application under 11 U.S.C. Sec. 330(a)(1)(A) and (a)(3); fee application for paralegals that worked on case not approved, and attorney fees beyond retainer amount denied because legal services of no-to-little value). 

(debtor filed Chapter 12 and had several "open accounts" with creditor, an input supplier for debtor's farming operation; accounts went unpaid and creditor filed claim in bankruptcy estate for over $1 million and court determined that debtor and wife personally responsible for debt, but that farming operation not liable). 

(after their marriage, wife executed quit-claim deeds on three parcels of land that husband owned; husband then conveyed the parcels to his children from a prior marriage before his death; after husband's death, surviving spouse took elective share of decedent's augmented estate and court determined that genuine issue of material fact existed as to whether the parcels should be included in decedent's augmented estate for purposes of calculating surviving spouse's elective share because facts existed that raised a question as to whether decedent retained possession and enjoyment of, and income from, the parcels after the transfer - decedent continued to use the parcels for recreational purposes and held himself out as the owner of the parcels; trial court's judgment dismissing surviving spouse's claim reversed). 

(plaintiff, land developer, denied CWA permit to fill wetlands for development purposes on basis that development of 5-acre plot did not fit with overall development plan and that tract should be considered to be a conservation wetlands; case remanded for trial). 

(plaintiff may claim property tax exemption for land transferred as start-up capital during formation of plaintiff by plaintiff's organizers; formative event of an LLC is the initial transfer of capital or capitalization of the LLC, not when articles of organization filed with state; thus transfer made within 90 days of formation under state law).

(court denied defendant's motion to dismiss plaintiff's claim that I.R.C. Sec. 107 is unconstitutional, but granted defendant's motion to dismiss plaintiff's claim that I.R.C. Sec. 265(a)(6)(B) is unconstitutional). 

(innocent spouse relief granted on portion of tax debt attributable to taxpayer's spouse, but no relief granted from taxes and penalties related to unreported income that taxpayer knew ex-spouse failed to report). 

(taxpayer had recognizable gain on sale of partnership interest in exchange for stock; constructive receipt doctrine applied - taxpayer had argued that because stock subject to significant restrictions (taxpayer couldn't sell the stock for 5 years) and stock would be forfeited if taxpayer went into competition with buyer of partnership interests, or quit working for the buyer or was fired for cause or poor performance, that taxpayer did not have gain recognition; court determined that constructive receipt doctrine applied because taxpayer would benefit from appreciation in value during 5-year period, would receive dividends during five-year period and could direct the voting of shares; transaction also structured to result in full taxation in year of sale).

(transaction structured to separate two businesses qualifies as tax-free reorganization, but purchase of assets from parent company trigger gain or loss). 

(plaintiff cannot challenge decision of Farm Service Agency that plaintiff did not qualify for debt restructuring because plaintiff did not exhaust administrative remedies with the National Appeals Division and, as such, plaintiff's federal claim is premature). 

(innocent spouse relief not available for taxpayer from joint liabilities with former spouse; equitable relief unavailable because taxpayer had knowledge that tax liabilities would not be paid).

(taxpayers, married couple, cannot deduct loss from joint venture; under joint venture operating agreement, payment not required until year after tax year in which loss claimed). 

(decedent's estate denied extension of time to make alternate value election under I.R.C. Sec. 2032; CPA error in not considering alternate valuation date on Form 706). 

(gain from sale of renewable energy credits under state program by state resident included in resident's income; full I.R.C. Sec. 25D credit not available for purchase of qualified solar electric property because credit not available for expenditure to extent of the amount excluded as a subsidy under I.R.C. Sec. 136(a)). 

(procedural case concerning plaintiff's application for permit to build swine barn).

(jury determination upheld that defendant, who is in the business of selling pumpkins, not guilty of hunting over illegal deer bait (illegally baiting deer) because he was engaged in a normal agricultural practice of composting; defendant grew pumpkins in patch near his farmhouse and in small field near his deer tree stand; defendant returned unsold crop to the small field to decompose; note - state DNR aerially observed defendant in tree stand).

(genuine issues of material fact existed on plaintiff's claims of fraudulent inducement, negligence and other claims related to plaintiff's co-signing of third party's note on which third party defaulted and defendant took action to foreclose on plaintiff's farm). 

(dairy farm stray-voltage case; plaintiffs failed to timely comply with expert-disclosure requirements and their claims were properly dismissed). 

(taxpayer not entitled to relief from joint tax liabilities with former spouse because taxpayer had actual knowledge of reason for tax deficiencies). 

(taxpayer's failure to report capital gains as a result of sale of stock not return preparer's fault; accuracy-related penalty upheld against taxpayer). 

(losses that are disallowed due to the at-risk rules of I.R.C. Sec. 465 are to be determined in accordance to partnership items, but are actually applied at the partner level; IRS would determine partner's share of partnership liabilities and whether those liabilities are recourse, non-recourse or shams, then IRS would issue on affected item notice of deficiency to the indirect partner to limit the partner's partnership losses to the amount of the partner's risk). 

(11 U.S.C. Sec. 526(a)(4) which prohibits debt relief agencies from advising clients to incur additional debt in contemplation of bankruptcy is constitutional in light of U.S. Supreme Court's decision in Milavetz ; trial court's judgment holding the provision unconstitutional reversed). 

(defendant's denial of special use application of plaintiff, who is located in an agricultural area, violated Religious Land Use and Institutionalized Persons Act (42 U.S.C. Sec. 2000cc)). 

(IRS deficiency determination and accuracy-related penalty sustained against taxpayers, a married couple; taxpayers did not have sufficient records to support their claimed deductions - long-term loss carryover, short-term capital loss, and various Schedule A deductions). 

(trial court's partition of farmland not clearly erroneous and claimed misconduct by referee appointed to assist in partition of land did not require appellate court to reverse). 

(trial court's partition of farmland not clearly erroneous and claimed misconduct by referee appointed to assist in partition of land did not require appellate court to reverse). 

(plaintiff's complaint that defendant had taken its land without providing just compensation in violation of Fifth Amendment dismissed; claim barred by res judicata).

(bank's identification of debtor in financing statement as "EDM Corporation D/B/A EDM Equipment" held to be seriously misleading; court upheld bankruptcy court's determination that adding trade name to registered organization's name violates Rev. UCC Sec. 9-503; search conducting standard search logic did not reveal bank's interest).  

(plaintiff, strip club operator, employed dancers as employees rather than independent contractors; plaintiff maintained sufficient control over dancers such that dancers were employees for unemployment tax purposes; plaintiff designated place where dancers performed, controlled customers, cover charge, tips, schedules, shifts, and fees charged for particular "services"; dancers also prohibited from "working the crowd" around stage area while another dancer on stage, and if dancer violated "house rule" plaintiff's management had authority to impose fines or terminate business relationship; also, dancers required to charge minimum price for various "dances" and if minimum not paid, plaintiff's doorman would inform customer that such behavior unacceptable).

(Minnesota non-profit corporation that develops duck nesting grounds violated state anti-corporate farming law and must divest self of 949-acre tract within one year; defendant did not get governor's approval to buy land at issue and governor did not approve purchase after-the-fact; plaintiff successfully argued that allowing defendant to keep land would create loophole in state's anti-corporate farming law and allow non-profits to buy up thousands of acres of wetlands and highly erodible cropland without state oversight).

(government need not stay its garnishment order which allowed seizure and sale of defendant's stored grain to satisfy defendant's restitution owed to the government as part of defendant's criminal sentence; defendant failed to identify any issue relating to garnishment order that was within special competency of administrative agency; and state foreclosure proceeding not parallel with present action). 

(Land Use Board of Appeals did not err in reversing county's plan amendment and zone change concerning 259-acre parcel; parcel was agricultural land). 

(group of companies not includible in decedent's estate; decedent did not retain ownership interest in companies at time of death, did not bear financial burdens of ownership and had no intent to own any interest in the companies).

(multi-million dollar judgment upheld against plaintiff for inverse condemnation of more than 100,000 non-commercial healthy citrus trees within 1,900 feet of trees with citrus canker; plaintiff had determined that trees within 1,900 feet of an infected tree are harmful or destructive; no substantial evidence present to support plaintiff's conclusion; plaintiff's reliance on legislature's determination that citrus canker is a public nuisance rejected because state cannot "transform private property into public property without compensation"; while regulation at issue promulgated to help citrus industry; 1,900 feet rule not supported by evidence and constituted unnecessary over-regulation).

(Roundup-Ready cotton case; defendant's willfully violated court's earlier order compelling discovery responses; court grants plaintiff's request for sanctions and orders defendant to pay plaintiff's cost for preparing motion for sanctions and must produce all documents relating to requests for seed and chemical purchases June 22, 2010).