Opinion
20409-19
10-18-2021
Estate of Lois Horvitz, Deceased, Michael Horvitz, Executor Petitioners v. Commissioner of Internal Revenue Respondent
ORDER
David Gustafson Judge
Now pending in this estate tax deficiency case are three motions: (1) the Commissioner's motion (Docs. 15, 26) for leave to file an amendment to answer (Doc. 27), to which petitioner has objected (see Doc. 22, 30); (2) the Commissioner's motion (Doc. 23) to take deposition, to which petitioner has filed an objection (see Doc. 29) and the Commissioner has filed a reply (Doc. 31); and (3) petitioner's motion for partial summary judgment (Doc. 32). In this order we will rule on the first two of these motions and will order further submissions on the third.
Amendment to answer.
The Commissioner's motion proposes to plead a negligence penalty not asserted in the notice of deficiency nor in the Commissioner's original answer. Rule 41(a) states that, after a responsive pleading has been served, "a party may amend a pleading only by leave of Court or by written consent of the adverse party, and leave shall be given freely when justice so requires." It is within our discretion to allow a party to amend its pleadings, and our discretion is guided by the following factors: (1) whether an excuse for the delay exists; (2) whether the opposing party would suffer unfair surprise, disadvantage, or prejudice if the motion to amend were granted; and (3) whether granting the motion would result in issues being presented in a seriatim fashion. See Estate of Grant v. Commissioner, 77 T.C.M 1762 (1999); Estate of Quick v. Commissioner, 110 T.C. 172, 178 (1998). For the reasons stated in our previous order (Doc. 25) and in the Commissioner's submissions (Docs. 15, 26), we will grant the motion. The chance of prejudice is especially small where trial is not scheduled (as here, where a motion by petitioner for a continuance has recently been granted, see Docs. 36-37). To the extent that petitioner's criticisms of the proposed amendment essentially argue that it lacks merit, that argument will be addressed when we address the merits of the penalty issues (if petitioner does not prevail on the tax issues).
Deposition.
The Commissioner acknowledges that a non-consented deposition is "extraordinary" under the rules of the Tax Court. See Rule 74(c)(1)(B). The Commissioner has not persuaded us that this case presents "extraordinary" warrant for a deposition. For the reasons stated in our previous order (Doc. 25) and in petitioner's objection (Doc. 29), we will deny the motion.
It is therefore
ORDERED that the Commissioner's motion (Doc. 15), as supplemented (see Doc. 26), to file an amendment to his answer is granted, and the Clerk of the Court shall file as of this date the lodged first amendment to answer (Doc. 27). It is further
ORDERED that the Commissioner's first-lodged amendment to answer (Doc.16) (which was superseded by Doc. 27) is hereby deemed stricken. It is further
ORDERED that the Commissioner's motion (Doc. 23) to take deposition is denied, without prejudice to the Commissioner's serving a trial subpoena in due course, and without prejudice to the filing of a Motion for Document Subpoena Hearing, as set out in https://www.ustaxcourt.gov/resources/zoomgov/subpoenas_for_remote_proceedings.pdf.
It is further
ORDERED that, no later than November 19, 2021, the Commissioner shall file a response to petitioner's motion (Doc. 32) for partial summary judgment and that, no later than December 17, 2021, petitioner shall file a reply.