Doyle v. Commissioner

T.C. Memo. 1997-396

UNITED STATES TAX COURT

S. BYRNE DOYLE and BARBARA S. DOYLE, Petitioners v.
COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 8309-96. Filed August 28, 1997.

Mark Clement, for petitioners.

Donna P. Leone, for respondent.

MEMORANDUM OPINION

TANNENWALD, Judge: Respondent determined a deficiency of

$3,199 in petitioners' 1983 Federal income tax, an addition to

tax of $160 under section 6653(a)(1),1 an addition to tax under

1
Unless otherwise indicated, all statutory references are
to the Internal Revenue Code in effect for the year in issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
 - 2 -

section 6653(a)(2) equal to 50 percent of the interest due on the

deficiency, an addition to tax of $960 under section 6659, and

increased interest under section 6621(c). After concessions by

petitioners, the issue for decision is whether the period for

assessment under section 6229 was validly extended by the general

partner of the partnership of which petitioner S. Byrne Doyle was

a limited partner.

Background

This case was submitted fully stipulated under Rule 122.

The stipulation of facts is incorporated herein by this reference

and found accordingly. We set forth below only those facts

pertinent to our decision. For general background, see our

opinion in Brown v. Commissioner, T.C. Memo. 1992-379, affd.

without published opinion sub nom. Konenkamp v. Commissioner, 14

F.3d 47 (3d Cir. 1993), where issues for previous years involving

petitioners and the tax aspects of the partnership were

discussed.

At the time of the filing of the petition, petitioners

resided in western Pennsylvania. Petitioners filed a joint 1983

Federal income tax return.

The partnership was organized under the laws of the

Commonwealth of Pennsylvania to engage in racing and breeding

standardbred horses, including Shane T. Hanover, a standardbred

race horse (Shane). Petitioner S. Byrne Doyle was a limited
 - 3 -

partner of the partnership. Doyle's capital contribution to the

partnership was $17,000. The partnership consisted of 28 limited

partners and 1 general partner. The total capital contribution

by all partners to the partnership amounted to $425,000.

Originally, Thomas R. Jonell was the general partner of the

partnership. Each of the limited partners signed special powers

of attorney in favor of Mr. Jonell. Mr. Doyle signed his on

December 1, 1981. The power of attorney authorized Mr. Jonell to

execute the certificate of limited partnership on behalf of Mr.

Doyle, which would make him a limited partner, as well as to

execute the agreement of limited partnership (the partnership

agreement) on his behalf. Mr. Jonell signed the Pennsylvania

partnership certificate. A copy of the partnership agreement

which was proposed to govern the partnership was attached to the

private placement memorandum for the partnership. It gave the

following powers to the general partner:

8.1 Rights and Powers of General Partner
Except as expressly provided herein, the General
Partner shall have the exclusive right to manage the
business of the Partnership and is hereby authorized to
take any action of any kind and to do anything and
everything he deems necessary in connection therewith.
[Emphasis added.]

The general partner's authority was limited only with respect to

certain major actions, such as disposing of substantially all of

the partnership's assets and borrowing other than in the ordinary

course of business. Paragraph 9.2 of the partnership agreement
 - 4 -

set forth the procedure for the withdrawal of the general

partner.

During 1983, Daniel J. Farley was not a partner and had no

profit interest in the partnership. During 1984, he acquired a

17.64-percent profit interest in the partnership, and, at the end

of 1984, had the largest profit interest in the partnership.

During 1985, Mr. Farley acquired an additional 7.88-percent

profit interest by purchasing the interests of other partners,

including the 2-percent interest held by Mr. Jonell. On April

15, 1985, Mr. Jonell resigned as general partner. He indicated

in his letter tendering his resignation that he was resigning

pursuant to section 9.2 of the partnership agreement. Mr. Jonell

informed respondent that he had resigned as general partner.

Sometime after his resignation, Mr. Jonell proposed Mr.

Farley as the new general partner. Mr. Farley served as the

interim general partner after Mr. Jonell's resignation. In

November 1986, the limited partners signed consents authorizing

Mr. Farley to remain as interim general partner. Mr. Doyle

signed his consent on November 10, 1986. Mr. Farley kept

whatever partnership records existed and communicated with the

limited partners.

The United States Trotting Association (USTA) is the sole

registry of standardbred horses in the United States and is a

national body responsible for the registration of horses and

keeping of registration records. On February 27, 1987, ownership
 - 5 -

of Shane was transferred to the Danish Breeder's Group of

Copenhagen, Denmark (Danish Breeder's), in the records of the

USTA. An unsigned copy of the partnership agreement attached to

the private placement memorandum was submitted in March 1987 to

the USTA in order to show the source of authority to sell Shane

to Danish Breeder's.

Procedural Background

The partnership filed returns on a calendar year basis and

filed its 1983 return timely on April 15, 1984. In 1986,

respondent was conducting an audit of the partnership's 1983 tax

year.

At all times, Mr. Farley handled the audit with Revenue

Agent James Schrmack. On or about May 12, 1986, Mr. Schrmack and

Mr. Farley met to go over the audit. During this meeting, Mr.

Schrmack advised Mr. Farley that a notice of the beginning of

examination for 1983 had to be sent out to the partnership and

that a tax matters partner (TMP) had to be named for the

partnership. Because it was probable that the period of

limitations would have to be extended, Mr. Schrmack needed

someone with whom he could conduct the examination, and someone

who could sign a consent to extend the period of limitations.

Mr. Schrmack advised Mr. Farley that, in the event a TMP was not

named, Mr. Schrmack would have to get Mr. Jonell to sign such a

consent. Absent a valid extension, the expiration date for the
 - 6 -

period of limitations on the partnership's return for the 1983

tax year was April 15, 1987.

During the May 12, 1986, meeting, Mr. Farley advised Mr.

Schrmack that Mr. Jonell had resigned as general partner in 1985

and wanted no further involvement with the partnership, and that

he, Mr. Farley, was the general partner and would be the only

logical choice as TMP for the partnership because he was the only

person sufficiently knowledgeable of the partnership. Mr. Farley

and Mr. Schrmack met again on July 28, 1986. In a letter to Mr.

Schrmack mailed subsequent to this meeting, Mr. Farley

represented to Mr. Schrmack that he, Mr. Farley, was "impowered"

(sic) as the "tax matters person" for the partnership.

On October 21, 1986, Mr. Farley executed a Form 872-O,

"Special Consent to Extend the Time to Assess Tax Attributable to

Items of a Partnership" with respect to the partnership's 1983

tax year (the 1986 consent). Mr. Farley signed the form on the

line calling for the signature of the TMP. The form was executed

on behalf of respondent on November 4, 1986. Respondent did not

mail a Form 872-N (to terminate the Form 872-O special consent)

to the partnership, nor did respondent receive a Form 872-N from

the partnership.

No document was filed with respondent designating Mr. Farley

as the TMP for the partnership for 1983. The partnership did not

designate a TMP on its return for 1983. Respondent did not

designate Mr. Farley as TMP. Respondent made no determination
 - 7 -

that it was impractical to use the general partner with the

largest profit interest whose name appears first in the alphabet

as TMP for 1983, nor did respondent make a selection of a TMP for

the partnership for 1983 after determining that it was

impractical to use the general partner with the largest profits

interest whose name appears first in the alphabet.

On August 24, 1987, respondent sent a 60-day letter to Mr.

Farley with respect to the partnership. Mr. Farley filed, as

authorized representative for the partnership, a written protest

in response to the 60-day letter. On October 11, 1988,

respondent issued a notice of final partnership administrative

adjustment (FPAA) to the partnership for the years 1983, 1984,

and 1985 (the 1988 FPAA). The 1988 FPAA was not addressed to a

specific individual, but rather was a generic FPAA issued to the

TMP for the partnership, at the address on the partnership's 1983

return. Respondent did not allege in the 1988 FPAA that any

proposed adjustment to the partnership's 1983 return was due to a

false return, fraud, or a gross omission from income.

The partnership, Richard E. Doyle and Nancy B. Doyle,2 and

petitioners, as partners other than the TMP, timely filed a

petition for readjustment of partnership items set forth in the

FPAA on February 21, 1989 (the 1989 petition), which was docketed

2
Richard and Nancy Doyle are Mr. Doyle's brother and
sister-in-law. Brown v. Commissioner, T.C. Memo. 1992-379, affd.
without published opinion sub nom. Konenkamp v. Commissioner, 14
F.3d 47 (3d Cir. 1993).
 - 8 -

by this Court under number 3318-89. On January 4, 1995,

petitioners filed a petition in the U.S. Bankruptcy Court for the

Western District of Pennsylvania. On January 4, 1995, the

partnership proceeding under Tax Court docket No. 3318-89 was

still pending. The filing of the petition in bankruptcy

converted petitioners' partnership items to nonpartnership items

under section 6231(b)(1)(D) and (c)(2), and section 301.6231(c)-

7T(a), Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6779, 6793

(March 5, 1987). On April 11, 1995, petitioners received a

bankruptcy discharge under Chapter 7. The discharge lifted the

automatic stay under 11 U.S.C. sec. 362(a)(8) and (c)(2)(C)

(1994) and allowed this Court to enter an order on July 11, 1995,

dismissing the case at docket No. 3318-89 as moot because, due to

the effect of the bankruptcy of petitioners and another partner

and settlements of other partners, there were no partnership

items to be readjusted.

On November 13, 1995, respondent issued a notice of

deficiency to petitioners in connection with their interest in

the partnership (the 1995 notice). Petitioners did not file a

petition with this Court in response to the 1995 notice. On

February 6, 1996, respondent rescinded the 1995 notice with

petitioners' consent, under section 6212(d). On February 6,
 - 9 -

1996, respondent issued to petitioners the notice of deficiency

(the 1996 notice) which is the basis for this case.

Discussion

The partnership is governed by the TEFRA partnership

provisions, found in sections 6221 through 6233.3 Under section

6229(a), respondent has 3 years from the date of the filing of

partnership return (or the due date for filing such return

without regard to extensions) in which to assess the tax

attributable to a partnership item or affected item for any

person with respect to a given taxable year. Under section

6229(d), if respondent issues an FPAA within 3 years, the period

of limitations of section 6229(a) is suspended for the period

during which a partnership-level action may be brought, until the

decision of the court in such action, if brought, becomes final,

and for 1 year thereafter.

If, by reason of an event described in section 6231(b), a

partnership item becomes a nonpartnership item during the period

otherwise allowed for assessment under section 6229, the period

for assessment ends 1 year after the date upon which the item

becomes a nonpartnership item. Sec. 6229(f). The 1988 FPAA was

3
Enacted as part of the Tax Equity and Fiscal
Responsibility Act of 1982 (TEFRA), Pub. L. 97-248, 96 Stat. 324.
The provisions are effective for partnership tax years beginning
after Sept. 3, 1982.
 - 10 -

issued on October 11, 1988. A partnership-level action was

brought on February 21, 1989. Petitioners filed a bankruptcy

petition on January 4, 1995, which had the effect of converting

the partnership items into nonpartnership items as to petitioners

as of that date. Secs. 6229(f), 6231(b)(1)(D) and (c)(2); sec.

301.6231(c)-7T(a), Temporary Proced. & Admin. Regs., 52 Fed. Reg.

6779, 6793 (March 5, 1987). The 1995 notice was issued on

November 13, 1995, less than 1 year after the date upon which the

partnership items became nonpartnership items. That notice was

rescinded with petitioners' consent, and the 1996 notice was

issued, both on February 6, 1996.4

Thus, if the original FPAA was timely, it would have

operated to suspend the section 6229(a) period of limitations,

which would have remained suspended until 1 year after the

partnership items involved in this case became nonpartnership

items due to petitioners' bankruptcy. Because the original

notice of deficiency was issued within 1 year of the date upon

which the the partnership items became nonpartnership items, it

would also have been timely. However, the FPAA was not issued

until after the expiration date of the 3-year statutory period

generally applicable to an assessment with regard to the

partnership's 1983 tax year, April 15, 1987, and both notices of

4
Sec. 6212(d) provides that a notice of deficiency that is
later rescinded operates to suspend any period of limitations
while it is still outstanding. Here, this presents no limit.
 - 11 -

deficiency were issued more than 3 years from the date of the

original return. Thus, respondent's action would be time-

barred, absent some exception to the general rule.

An exception is embodied in section 6229(b)(1)(B) which

provides that the 3-year period may be extended:

with respect to all partners, by an agreement entered
into by the Secretary and the tax matters partner (or
any other person authorized by the partnership in
writing to enter into such an agreement), before the
expiration of such period. [Emphasis added.]

The parties agree that there was no TMP for 1983 and, thus, a

consent could only have been executed by the "person authorized

by the partnership in writing".

Petitioners contend that the 1986 consent signed by the

general partner Mr. Farley was ineffective to extend the 3-year

period, because Mr. Farley was not "authorized by the partnership

in writing" to execute such a consent. Therefore, according to

petitioners, the 1988 FPAA was untimely, and the subsequent 1996

notice of deficiency was consequently also untimely. Respondent

contends that both the 1988 FPAA and the 1996 notice were timely.

According to respondent, Mr. Farley was "authorized by the

partnership in writing" to consent to extend the period in which

respondent could issue an FPAA, either by the authority granted

to him in the partnership agreement, or by State partnership law

alone. Respondent further contends that, even if Mr. Farley was
 - 12 -

not so authorized, petitioners should be equitably estopped from

denying that Mr. Farley executed a valid consent.

Petitioners concede that, if the 1986 consent was validly

executed, then the period of assessment was open under section

6229(b) when the FPAA was issued, the February 6, 1996, notice of

deficiency was timely, and, in light of the decision in Brown v.

Commissioner, T.C. Memo. 1992-379 (in which petitioners were

parties), the substantive determinations set forth therein are

correct. Therefore, the only issue for decision is whether the

1986 consent executed by Mr. Farley was valid by virtue of Mr.

Farley's having been authorized in writing by the partnership

under section 6229(b)(1)(B) to extend the period of limitations.5

There are two potential sources of the authority6 of Mr.

Farley: (1) The partnership agreement itself, and (2)

Pennsylvania partnership law.

5
In this context, petitioners' arguments as to Mr.
Farley's eligibility for TMP status are irrelevant. If he was
authorized in writing, he need not even be a partner, let alone
the TMP. Amesbury Apartments, Ltd. v. Commissioner, 95 T.C. 227
(1990).
6
We need not concern ourselves with the regulations
governing agreements to extend the 3-year period of limitations
contained in sec. 301.6229(b)-1, Proposed Proced. & Admin. Regs.,
51 Fed. Reg. 13231, 13243 (April 18, 1986), and sec. 301.6229(b)-
1T, Temporary Proced. & Admin. Regs., 52 Fed. Reg. 6779, 6789
(March 5, 1987). The temporary regulations, which were adopted
after the date upon which Mr. Farley signed the 1986 consent, do
not, however, invalidate prior authorization granted by the
partnership. Amesbury Apartments, Ltd. v. Commissioner, 95 T.C.
227, 242 (1990).
 - 13 -

The only partnership agreement in the record herein is a

copy of such an agreement attached to the private placement

offering which was obviously a proposed agreement and therefore

contained no indication that it had been signed. That agreement

authorized a general partner to "take any action of any kind and

to do anything and everything he deems necessary in connection"

with the management of the business of the partnership.

Petitioners contend that only an executed partnership agreement

could grant Mr. Farley the necessary authority and that, aside

from any question as to the scope of the above authorizing

language, it cannot provide the necessary foundation for Mr.

Farley's action.

Initially, we think it important to emphasize that the

expiration of the period of limitations on an assessment is an

affirmative defense. Rules 39, 142(a). Petitioners have made a

prima facie case that the 1988 FPAA was issued after the 3-year

statutory period, thereby shifting the burden of going forward to

respondent. Respondent has come forward with evidence that the

statutory period was extended by the 1986 consent. If that

consent was valid on its face, the burden of going forward shifts

back to petitioners to show that the extension was invalid. See

Adler v. Commissioner, 85 T.C. 535, 541 (1985). The underlying

burden of proof, however, never shifts from petitioners. Rule

142(a); Welch v. Helvering, 290 U.S. 111, 114 (1933); see
 - 14 -

discussion in Amesbury Apartments, Ltd. v. Commissioner, 95 T.C.

227, 240-241 (1990).

A consent is valid on its face if it includes the name of

the taxpayer, the signature of the taxpayer or a person

authorized to sign on the taxpayer's behalf, the taxable year as

to which the period is to be extended, and was signed on a date

prior to the expiration of the limitations period. Lefebvre v.

Commissioner, T.C. Memo. 1984-202, affd. 758 F.2d 1340 (9th Cir.

1985). A consent signed by a person who has represented the

taxpayer before respondent, as Mr. Farley did on several

occasions prior to the signing of the 1986 consent, whether

signed on the line for "authorized representative", or in this

case for "tax matters partner", is valid on its face. Bugaboo

Timber Co. v. Commissioner, 101 T.C. 474 (1993); Cambridge

Research & Development Group v. Commissioner, 97 T.C. 287 (1991);

Amesbury Apartments, Ltd. v. Commissioner, supra. Under the

circumstances herein, we reject petitioners' contention that

respondent had a duty to look beyond the consent to ascertain

whether Mr. Farley was indeed the TMP or otherwise authorized to

act for the partnership.

Petitioners also argue that the 1986 consent was not valid

on its face because Mr. Farley did not attach a copy of the

written authorization from the partnership to the consent form.

In this connection, we note that Mr. Farley signed as TMP and
 - 15 -

that the consent form did not require the attachment of a copy of

the written authorization under such circumstances. Moreover,

the determination of whether a person was authorized to extend

the period of limitations does not turn on the existence of a

technical defect in the filling out of the form, such as a

failure to attach a copy of this authorization. Monetary II Ltd.

Partnership v. Commissioner, 47 F.3d 342, 347 (9th Cir. 1995)

(and cases cited thereat, especially Cambridge Research &

Development Group v. Commissioner, supra at 290 (non-TMP who

signed as TMP gave valid consent though the issue of the failure

to attach a copy of the written authorization was never raised)),

affg. T.C. Memo. 1992-562; Bugaboo Timber Co. v. Commissioner,

supra at 485; Pleasanton Gravel Co. v. Commissioner, 85 T.C. 839,

854-855 (1985) (and cases cited thereat).

Petitioners now have the burden of going forward with

evidence to show that the extension was invalid in order to

sustain their burden of proof. Here, that task translates into a

need to show that the particular agreement in the record was not

executed, and that Mr. Doyle did not intend to be bound by that

agreement in becoming a partner.

Petitioners attempt to sustain their position that there was

no executed partnership agreement simply by pointing to the

failure of efforts to find such a copy and the failure to supply

a signed copy to the USTA. See supra pp. 4-5. But such a
 - 16 -

failure standing alone is not sufficient evidence to sustain

petitioners' contention.7 We think it was incumbent on

petitioners to offer either evidence that might affirmatively

establish that the partnership agreement in the form attached to

the private placement memorandum was not executed (for example,

by way of testimony of Mr. Jonell) or some explanation of their

failure to provide such evidence. Wichita Terminal Elevator Co.

v. Commissioner, 6 T.C. 1158 (1946), affd. 162 F.2d 513 (10th

Cir. 1947). The fact that this case was submitted fully

stipulated does not relieve petitioners of the usual requirements

relating to carrying their burden of proof. Rule 122(b);

Borchers v. Commissioner, 95 T.C. 82, 91 (1990), affd. 943 F.2d

22 (8th Cir. 1991).

We think the absence of any such evidence is critical in

light of the facts that Mr. Doyle signed the power of attorney

for general partner Mr. Jonell to execute the certificate of

limited partnership and the partnership agreement, and that Mr.

Jonell then actually signed the partnership certificate, which

made Mr. Doyle a limited partner. We think that petitioners

should have produced some affirmative evidence to show that Mr.

7
We note here that, under Pennsylvania law, whether
petitioners in fact ever received an executed copy of the
agreement is irrelevant: "So long as the parties intend to be
bound by the contract, the failure of one party to receive an
executed copy of the agreement will not prevent it from becoming
operative." Daniel Adams Associates v. Rimbach Publishing, Inc.,
519 A.2d 997, 1005 (Pa. Super. Ct. 1987).
 - 17 -

Jonell did not carry out the other part of his authority under

the power of attorney by executing the partnership agreement on

behalf of Mr. Doyle. Additionally, we note that Mr. Doyle later

consented in a signed writing that Mr. Farley act as general

partner after Mr. Jonell had resigned. This would indicate that

some agreement in respect of the operations of the partnership

existed and that, absent any contrary evidence, the agreement

attached to the private placement memorandum represented that

understanding.

Furthermore, petitioners have not offered any evidence to

indicate that there is a different agreement from the one in the

record which governs the partnership of which Mr. Doyle was a

member, nor that the partnership agreement in the record pertains

to a different partnership. Petitioners concede that Mr. Doyle

was a partner, and it is established that the 29 partners

involved invested $425,000 in the partnership. Under these

circumstances, we think it highly unlikely that there was not an

executed partnership agreement.

However, we find it unnecessary to find as a fact that the

partnership agreement attached to the private placement

memorandum was executed. We simply hold that petitioners have

failed to carry their burden of proof that it was not executed.

In this context and having in mind the difference in the location

of the burden of proof in this case as contrasted with the
 - 18 -

Pennsylvania cases cited by petitioners, we have no need to deal

with petitioners' assertion that they should prevail because an

agreement is unenforceable under Pennsylvania law against a party

who has not signed it. Similarly, we have no need, then, to

address petitioners' argument that the alleged failure to sign

the writing represents a mutual mistake under Commissioner v.

Danielson, 378 F.2d 771 (3d Cir. 1967), remanding 44 T.C. 549

(1965), the Court of Appeals to which an appeal herein would lie.

We note merely that Danielson stands for the proposition that a

party seeking to vary the terms of a contract must show that the

contract should not be recognized due to some conduct that

invalidated the meeting of the minds necessary for assent to the

terms of the agreement, in the nature of fraud, duress, undue

influence, or mutual mistake. Id.; Highland Farms, Inc. v.

Commissioner, 106 T.C. 237, 255-256 (1996). Petitioners have

offered no evidence that Mr. Doyle's relationship to the

partnership was somehow tainted and thus invalid. Danielson

simply has no application herein.

Having held that petitioners have failed to carry their

burden of proving that the partnership agreement was not

executed, we are left with the question whether the authority

granted to the general partner in the agreement, see supra p. 3,

is sufficiently broad to include the signing of the consent by

Mr. Farley. We think that, by its terms, it was sufficiently
 - 19 -

broad since it is clear that the execution of consent does not

fall within the scope of the provisions which limited such

authority in respect of a major partnership action. See supra p.

3. Thus, we do not have the situation which existed in Medical &

Business Facilities Ltd. v. Commissioner, 60 F.3d 207 (5th Cir.

1995), revg. T.C. Memo. 1994-38, where there was no broad grant

of authority to any individual general partner in the partnership

agreement and the agreement contained considerably broader

restrictions on the actions of an individual general partner than

exist herein.

In Cambridge Research & Development Group v. Commissioner,

97 T.C. 287, 289, 300 (1991), we held that the authority granted

in a partnership agreement to a general partner to "take any

action or do anything in furtherance of the Partnership business"

(quoting partnership agreement) was enough to satisfy the

requirements of section 6229(b)(1)(B) to authorize that general

partner in writing to execute a consent to extend the section

6229(a) period of limitations, as long as extending such a period

of assessment was within the scope of partnership business under

State law. See Bugaboo Timber Co. v. Commissioner, 101 T.C. at

484. We also held that a high level of specificity for

authorizations made before the effective date of the regulations

is not required--a broad grant of authority will suffice for the

purposes of the statute. Cambridge Research & Development Group
 - 20 -

v. Commissioner, supra at 301; see Bugaboo Timber Co. v.

Commissioner, supra.

In this case, the authorizing language in the partnership

agreement is almost identical to that in Cambridge Research &

Development Group, granting the general partner the power "to

take any action of any kind and to do anything and everything he

deems necessary in connection" with the partnership business.

Thus, if such a grant of power is not otherwise restricted under

Pennsylvania law, then the partnership agreement in this case

would qualify as a "writing" under section 6229(b)(1)(B).

We have been unable to find a Pennsylvania case on point.

We thus decide the issue as if we were sitting as the highest

court of that State. Commissioner v. Estate of Bosch, 387 U.S.

456, 465 (1967). In enacting the TEFRA provisions, Congress

clearly intended activities involved in a unified partnership-

level tax proceeding to be partnership business. Cambridge

Research & Development Group v. Commissioner, supra at 298. The

power to extend the section 6229(a) period of limitations has

been found to be within the scope of partnership business under

the Uniform Partnership Act (UPA) and the Uniform Limited

Partnership Act (ULPA) as enacted by the States of Alabama,8

8
Ala. Code secs. 10-9A-62, 10-8-49 (Michie 1991); Amesbury
Apartments, Ltd. v. Commissioner, 95 T.C. 227 (1990); see
discussion in Cambridge Research & Development Group v.
Commissioner, 97 T.C. 287, 298 (1991).
 - 21 -

California,9 Colorado,10 Connecticut,11 and Louisiana.12 In this

case, the relevant State law in force at the time of the signing

of the 1986 consent was also the UPA and ULPA, as enacted by the

Commonwealth of Pennsylvania.13 The UPA statutes discussed above

are all substantially identical to each other, and to the UPA

(1914 Act) (U.L.A.) section 9. The ULPA statutes discussed above

are all substantially identical to each other, and to the Revised

ULPA (1976) (U.L.A.) section 403. Given the similarity of the

statutes involved, we conclude that, under Pennsylvania law, the

power to extend the section 6229(a) period of limitations is

within the scope of partnership business, and the partnership

9
Cal. Corp. Code sec. 15509 (West 1991); Iowa Investors
Baker v. Commissioner, T.C. Memo. 1992-490. Iowa Investors Baker
does not discuss Cal. Corp. Code sec. 15509 (West 1991),
regarding the rights of general partners in a limited
partnership.
10
Colo. Rev. Stat. secs. 7-60-109, 7-62-403 (1986);
Georgetown Petroleum-Edith Forrest v. Commissioner, T.C. Memo.
1994-13.
11
Conn. Gen. Stat. Ann. secs. 34-17, 34-47 (West Supp.
1997); Cambridge Research & Development Group v. Commissioner, 97
T.C. 287, 298 (1991).
12
La. Civ. Code Ann. art. 2814 (West 1994); Medical &
Business Facilities Ltd. v. Commissioner, T.C. Memo. 1994-38
(while not part of the UPA, article 2814 designed to bring
Louisiana law into conformity with that of 48 States which have
adopted the UPA), revd. on other grounds 60 F.3d 207 (5th Cir.
1995).
13
15 Pa. Cons. Stat. Ann. sec. 8533 (West 1995), derived
from 59 Pa. Cons. Stat. sec. 523 (West 1987), and 15 Pa. Cons.
Stat. Ann. sec. 8321 (West 1995), reenacting 59 Pa. Cons. Stat.
sec. 321 (West 1987).
 - 22 -

agreement in this case qualifies as a "writing" under section

6229(b)(1)(B).14

In sum, we hold that Mr. Farley as the general partner was

"authorized by the partnership in writing" within the meaning of

section 6229(b)(1)(B) to execute a consent to extend the section

6229(a) period of limitations and, consequently, that the 1986

consent executed by Mr. Farley was valid, and the 1996 notice was

timely. Based on this holding, we need not and do not reach

respondent's other arguments based on the operation of

Pennsylvania partnership law alone,15 or equitable estoppel.

Accordingly,

Decision will be entered

for respondent.

14
Petitioners argue that because the Form 2848 granting
Mr. Farley power of attorney to represent the partnership was
never filed, Mr. Farley had no authority to sign the consent.
But a general partner needs no power of attorney to act on behalf
of the partnership. 15 Pa. Cons. Stat. Ann. secs. 8321, 8533
(West 1995).
15
See Cambridge Research & Development Group v.
Commissioner, 97 T.C. 287, 291 (1991) (where we expressly left
that question open); see also Medical & Business Facilities Ltd.
v. Commissioner, 60 F.3d 207, 211 (5th Cir. 1995) (holding that a
statute is not a sufficient written authorization), revg. T.C.
Memo. 1994-38.