Jeffries v. Comm'r

T.C. Memo. 2010-172

UNITED STATES TAX COURT

AMY RUTH JEFFRIES, TRANSFEREE, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket No. 16504-07. Filed August 4, 2010.

Amy Ruth Jeffries, pro se.

Richard J. Hassebrock, for respondent.

MEMORANDUM FINDINGS OF FACT AND OPINION

WELLS, Judge: Respondent determined that petitioner was

liable, as a transferee of the Amy Ruth Jeffries Trust in

Bankruptcy, Marc Preston Gertz, Trustee (bankruptcy estate), for

its 2001 tax year for an assessed income tax liability of

$118,310, an addition to tax pursuant to section 6651(a)(1) of

$26,620, an addition to tax pursuant to section 6651(a)(2) of
 - 2 -

$29,578, and an addition to tax pursuant to section 6654 of

$4,682.1 We must decide whether petitioner is liable as a

transferee of the bankruptcy estate for the bankruptcy estate’s

tax liability and additions to tax pursuant to section 6901.

FINDINGS OF FACT

Some of the facts and certain exhibits have been stipulated.

The parties’ stipulations of fact are incorporated in this

opinion by reference and are found accordingly.

At the time she filed her petition, petitioner resided in

Ohio.

Petitioner began working at Wal-Mart’s Fairlawn, Ohio, store

as a courtesy desk clerk and customer service manager on November

5, 1992, and was promoted to “lead” customer service manager on

June 8, 1993. Petitioner expressed an interest in being promoted

and was permitted to work alongside the storewide personnel

manager. The personnel manager resigned from Wal-Mart in March

1997, and petitioner and another employee applied to fill the

position permanently. Petitioner scheduled a meeting with the

Ohio Civil Rights Commission (OCRC) because she feared being

passed over for a promotion on the basis of racial

discrimination. Another employee was promoted to the position of

1
Unless otherwise indicated, all Rule references are to the
Tax Court Rules of Practice and Procedure, and all section
references are to the Internal Revenue Code, as amended, for the
year in issue. Amounts are rounded to the nearest dollar.
 - 3 -

storewide personnel manager. On April 14, 1997, petitioner filed

charges against Wal-Mart with the OCRC, alleging a discriminatory

failure to promote her.

On May 21, 1998, petitioner’s discrimination charges

proceeded to litigation in the U.S. District Court for the

Northern District of Ohio (District Court), where she also

alleged retaliation under title VII of the Civil Rights Act of

1964, as amended, Pub. L. 88-352, tit. VII, 78 Stat. 253,

codified at 42 U.S.C. secs. 2000e-2000e-17 (2006), and Ohio law

(Wal-Mart suit). The jury found in petitioner’s favor on her

retaliation claim and awarded her $8,500 in compensatory damages,

$425,000 in punitive damages, and $119,073 in accrued interest,

and the district court entered judgment in accordance with the

verdict. Wal-Mart appealed the judgment to the U.S. Court of

Appeals for the Sixth Circuit.

On July 26, 1999, with the appeal of the judgment in the

Wal-Mart suit still pending, petitioner filed a petition for

protection under chapter 7 of the Bankruptcy Code in the U.S.

Bankruptcy Court for the Northern District of Ohio (bankruptcy

court). Petitioner did not list respondent as a creditor. As a

result of the filing, the bankruptcy estate was created and Marc

Preston Gertz (Mr. Gertz) was named trustee. Upon creation of

the bankruptcy estate, the potential proceeds of the Wal-Mart

suit (proceeds) became property of the bankruptcy estate.
 - 4 -

On July 21, 2001, the U.S. Court of Appeals for the Sixth

Circuit affirmed the District Court judgment. On October 10,

2001, Wal-Mart satisfied the judgment and issued a $552,573 check

for the proceeds to the bankruptcy estate. The proceeds were

deposited into the bankruptcy estate’s bank account. The

bankruptcy estate earned interest of $3,217 on the deposited

funds during the 2001 tax year.

On June 18, 2002, petitioner received a distribution of

$200,000 from the bankruptcy estate after indicating to Mr. Gertz

that she and her husband “desperately needed funds”. Following

the distribution the bankruptcy estate had $133,014 in funds

remaining and still owed trustee’s fees of $18,533 and expenses

of $96 to Mr. Gertz and $60,741 to creditors named in the

bankruptcy petition. On October 3, 2003, petitioner received a

final disbursement of $53,935 from the bankruptcy estate,

representing all remaining assets following payments to all

listed creditors. On June 23, 2004, Mr. Gertz filed a final

report with the bankruptcy court. The bankruptcy estate did not

file a Federal income tax return or pay Federal income tax for

its 2001 tax year. On July 10, 2004, Mr. Gertz filed a final

account with the bankruptcy court and indicated that the

bankruptcy estate’s bank account had a zero balance. On

September 24, 2004, the bankruptcy court issued a final decree

and closed petitioner’s bankruptcy case.
 - 5 -

On October 17, 2003, petitioner filed a Form 1040, U.S.

Individual Income Tax Return, jointly with her husband for their

2002 tax year.2 Petitioner’s 2002 return included $232,252 in

distributions and $126,090 in interest income from the bankruptcy

estate. On December 7, 2004, petitioner filed a Form 1040X,

Amended U.S. Individual Income Tax Return, jointly with her

husband for their 2002 tax year. On the amended return

petitioner and her husband decreased their adjusted gross income

by $311,675, claiming that the proceeds of the Wal-Mart suit were

exempt from Federal income tax pursuant to Rev. Rul. 78-134,

1978-1 C.B. 197.3

The Internal Revenue Service (IRS) examined the bankruptcy

estate’s 2001 tax year, and, on December 16, 2005, respondent

mailed a notice of deficiency to the bankruptcy estate for its

2001 tax year determining a deficiency in income tax of $116,824,

an addition to tax pursuant to section 6651(a)(1) of $26,285, and

an addition to tax pursuant to section 6654 of $4,669, as well as

an addition to tax in an undetermined amount pursuant to section

6651(a)(2). Mr. Gertz did not file a petition in this Court on

behalf of the bankruptcy estate in response to the notice of

deficiency. On June 5, 2006, respondent assessed a tax liability

2
Mr. Jeffries is not a party to these proceedings.
3
The $311,675 included $185,585 in distributions from the
bankruptcy estate and $126,090 in interest income from the
bankruptcy estate.
 - 6 -

against the bankruptcy estate of $118,310, as well as additions

to tax totaling $29,578, and interest of $29,878.4

On January 23, 2007, petitioner submitted a “Letter of

Protest” contesting respondent’s transferee liability examination

claiming that she is not a transferee because the surplus funds

were not assets of the bankruptcy estate, the bankruptcy estate

was solvent at the time of distribution, any distributions were

made pursuant to the final order of the bankruptcy court, and

that the Government has not exhausted all reasonable efforts to

collect from the bankruptcy estate.

On February 22, 2007, petitioner filed a motion in the

bankruptcy court to reopen her bankruptcy case, which the

bankruptcy court granted on February 26, 2007.

4
The Dec. 16, 2005, notice of deficiency sent to the
bankruptcy estate determined a deficiency of $116,824. On June
5, 2006, respondent assessed a tax liability against the
bankruptcy estate of $118,310. The $118,310 assessment is the
same amount determined in the Apr. 26, 2007, notice of transferee
liability sent to petitioner. The Dec. 16, 2005, notice of
deficiency sent to the bankruptcy estate was based upon the
allowance of a standard deduction of $3,800 in the calculation of
taxable income, but the June 5, 2006, calculations omitted the
standard deduction. The calculations of the additions to tax are
based upon the amount determined in the notice of deficiency and
contain a similar discrepancy. See secs. 6651(a)(1) and (2),
6654. In a bankruptcy proceeding where the debtor is an
individual, if the bankruptcy estate does not itemize deductions,
it is entitled to a standard deduction equivalent to that allowed
for a married individual filing a separate return. Sec. 1398(c).
For tax year 2001 the standard deduction for a married individual
filing a separate return was $2,500. Sec. 63(c)(2)(D).
 - 7 -

On April 26, 2007, respondent mailed petitioner a notice of

transferee liability determining that petitioner was liable, as

transferee of the bankruptcy estate for its 2001 tax year, for an

income tax deficiency of $118,310, an addition to tax pursuant to

section 6651(a)(1) of $26,620, an addition to tax pursuant to

section 6651(a)(2) of $29,578, and an addition to tax pursuant to

section 6654 of $4,682. On July 23, 2007, petitioner timely

filed a petition for review of the notice of transferee liability

with this Court.

On October 15, 2007, petitioner and Mr. Gertz filed a joint

motion to have the bankruptcy court determine the tax liability

of the bankruptcy estate for its 2001 tax year. In response, the

United States filed a motion to dismiss the action. Among the

contentions in its motion for dismissal, the United States

contends that petitioner elected to proceed in the Tax Court for

adjudication of petitioner’s liability for the tax deficiency.

On December 24, 2007, petitioner and Mr. Gertz filed an objection

to the United States’ motion to dismiss. Among the contentions

in the joint objection, petitioner and Mr. Gertz contend that the

bankruptcy case was reopened before the Tax Court case, that the

Tax Court case has nothing to do with the administrative issues

in the bankruptcy case, and that the bankruptcy court has

exclusive jurisdiction to determine the tax liability of the

bankruptcy estate. On March 6, 2008, petitioner and Mr. Gertz
 - 8 -

withdrew their joint motion to determine the tax liability of the

bankruptcy estate, which the bankruptcy court permitted. Mr.

Gertz then filed on behalf of the bankruptcy estate a Form 1041,

U.S. Income Tax Return for Estates and Trusts, reporting a total

Federal income tax due of $160,731 for tax year 2001.

On April 4, 2008, the United States filed a motion in the

bankruptcy court to vacate the order of distribution, to order

disgorgement from petitioner and Mr. Gertz, and to order an

accounting because the previous distributions to petitioner were

erroneous and Mr. Gertz failed to file for and pay the bankruptcy

estate’s Federal income tax liability. Mr. Gertz filed a brief

in partial opposition, claiming that the disgorgement of his

trustee fee should represent the extent of his liability.

On September 4, 2008, this Court set the instant transferee

liability case for trial in Columbus, Ohio, for the trial session

beginning February 9, 2009, and on February 10, 2009, the instant

case was tried.

We take judicial notice of several filings made and orders

entered after trial. On December 21, 2009, an agreed order was

entered by the bankruptcy court in which Mr. Gertz was ordered to

disgorge his trustee fee of $18,533. On February 24, 2010, the

bankruptcy court ordered that $3,012 of Mr. Gertz’ trustee fee

would be distributed to the State of Ohio and $15,521 would be

distributed to respondent. The bankruptcy court also stated that
 - 9 -

“This order is without prejudice as it regards the rights and

remedies of the Internal Revenue Service to seek disgorgement

from Debtor [petitioner], or to impose transferee liability on

her under 26 U.S.C. § 6901.” On April 30, 2010, Mr. Gertz filed

an amended chapter 7 “Trustee’s Final Account and Distribution

Report Certification” stating that the bankruptcy estate had been

fully administered and an application for discharge. On May 25,

2010, the United States filed a response. In that response the

United States stated that “there should be no presumption that

the case has been fully administered because the United States

has filed this objection within the 30-day period after the

filing of the trustee final account.” However, the United States

“does not necessarily object to the final report- i.e., it only

objects if the Court would construe its approval to have

preclusive force with respect to the United States’ suit against

[Mr. Gertz].”

On May 25, 2010, the United States also filed a suit in the

U.S. District Court for the Northern District of Ohio against Mr.

Gertz seeking to recover:

damages equal to the full unpaid balance due upon its
administrative claim, $281,300.56, plus interest from May
24, 2010 for [F]ederal income taxes, penalties and interest
due from the Chapter 7 estate of [petitioner] for the year
ended December 31, 2001.
 - 10 -

See United States v. Gertz, No. 5:10-cv-1171 (N.D. Ohio May 25,

2010) (complaint).5

On July 9, 2010, the bankruptcy court entered an agreed

order closing the bankruptcy case. Additionally, the bankruptcy

court stated that the order closing the case: “in no way bars

the United States’ action for damages against [Mr. Gertz] * * *

or any other action to collect the tax liabilities of the debtor

from the debtor or other sources.”

OPINION

As a preliminary matter, we discuss whether we are barred by

either the automatic stay of 11 U.S.C. sec. 362 (1994), or the

permanent injunction of 11 U.S.C. sec. 524 (1994), from hearing

the instant case.

Upon the filing of a bankruptcy petition an automatic stay

arises to temporarily bar actions against or concerning the

debtor or property of the debtor or the bankruptcy estate. 11

U.S.C. sec. 362(a); Kovitch v. Commissioner, 128 T.C. 108, 111

(2007). The automatic stay operates as a stay against: “the

5
Respondent asserts that he is entitled to seek relief in
both the District Court and the Tax Court. While the bankruptcy
court might have been able to provide more complete relief, we
see no barrier to deciding the instant case as the parties have
presented it to us.
 - 11 -

commencement or continuation of a proceeding before the United

States Tax Court concerning the debtor.” 11 U.S.C. 362(a)(8).6

The Court has jurisdiction to determine whether the

automatic stay prevents us from proceeding in the instant case.

See Kovitch v. Commissioner, supra at 112. We have construed the

phrase “concerning the debtor” to mean that the automatic stay

should not apply unless the Tax Court proceeding possibly would

affect the tax liability of the debtor in bankruptcy. Id.

The automatic stay continues until the earliest of the

following occurrences: The case is closed, the case is

dismissed, or a discharge is granted or denied. 11 U.S.C. sec.

362(c)(2). A discharge operates, among other things, as an

injunction against: “the commencement or continuation of an

action, the employment of process, or an act, to collect, recover

or offset any such debt as a personal liability of the debtor”.

11 U.S.C. sec. 524(a)(2). However, a discharge applies only to

those debts that arose before the date of the order for relief.

6
At the time of the original bankruptcy filing, July 26,
1999, 11 U.S.C. sec. 362(a)(8) read: “(8) the commencement or
continuation of a proceeding before the United States Tax Court
concerning the debtor.” The Bankruptcy Abuse Prevention and
Consumer Protection Act of 2005, Pub. L. 109-8, sec. 709, 119
Stat. 127, amended 11 U.S.C. sec. 362(a)(8), effective in cases
commenced on or after Oct. 17, 2005. Id. sec. 1501, 119 Stat.
216. The amended version removed the phrase “the debtor” and
replaced it with the phrase “a corporate debtor’s tax liability
for a taxable period the bankruptcy court may determine or
concerning the tax liability of a debtor who is an individual for
a taxable period ending before the date of the order for relief
under this title”.
 - 12 -

11 U.S.C. 727(b) (1994). The commencement of a voluntary

bankruptcy case constitutes an order for relief. 11 U.S.C. sec.

301 (1994).

Petitioner’s bankruptcy case was originally closed on

September 24, 2004, as of which date the automatic stay

terminated. See 11 U.S.C. secs. 362(c)(2), 524. Following the

commencement of the bankruptcy case, the bankruptcy estate

received $552,573 in satisfaction of the Wal-Mart suit during tax

year 2001. The income tax liability associated with that income

became due and owing at the close of the bankruptcy estate’s 2001

tax year.7 See Hagaman v. Commissioner, 100 T.C. 180, 185

(1993). The additions to tax would have accrued when the tax

return went unfiled and the tax liability went unpaid. See secs.

6012(a)(9), 6072(a), 6151(a), 6651(a)(1) and (2), 6654.

Accordingly, the permanent injunction of 11 U.S.C. section 524

does not bar respondent from seeking the tax liability or the

additions to tax of the bankruptcy estate against petitioner as a

transferee as those liabilities are debts that arose after July

26, 1999, the date petitioner filed her voluntary bankruptcy

case. See 11 U.S.C. sec. 727(b).

7
In its return filed with respondent the bankruptcy estate
claims to be a calendar year taxpayer. The record contains no
evidence that the bankruptcy estate elected a different tax year.
Secs. 441(g), 1398(j)(1).
 - 13 -

The bankruptcy case was reopened pursuant to 11 U.S.C.

section 350(b) (1994) to establish the tax liability of the

estate pursuant to 11 U.S.C. section 505 (1994). The reopening

of a bankruptcy case does not automatically continue or

reactivate the automatic stay. Mass. Dept. of Revenue v.

Crocker, 362 Bankr. 49, 56 (B.A.P. 1st Cir. 2007); Allison v.

Commissioner, 97 T.C. 544, 546 (1991). A bankruptcy court may

reinstate a stay under its broad equitable powers under 11 U.S.C.

section 105(a) (1994). Mass. Dept. of Revenue v. Crocker, supra

at 56-57. However, the bankruptcy court has not done so in the

instant case. Additionally, the reopened bankruptcy case has

been closed. See 11 U.S.C. sec. 362(c)(2). Consequently, we

hold that we are not barred from proceeding with the instant

case.

Section 6901(a) provides that the liability, at law or in

equity, of a transferee of property “shall * * * be assessed,

paid, and collected in the same manner and subject to the same

provisions and limitations as in the case of the taxes with

respect to which the liabilities were incurred”. Section 6901

does not impose liability on the transferee, but merely gives the

Commissioner a procedure or remedy to enforce the transferor’s

existing liability. See Commissioner v. Stern, 357 U.S. 39, 42

(1958) (discussing statutory predecessor of section 6901); see

also Hagaman v. Commissioner, supra at 183. The burden of proof
 - 14 -

is on the Commissioner to show that the taxpayer is liable, at

law or in equity, as a transferee, but not to show that the

transferor taxpayer was liable for the underlying tax. Sec.

6902(a); Rule 142(d).

Depending on the provisions of the particular State law and

the rules of equity that are involved in a case, factors

generally relevant in considering transferee liability have been

described as follows:

(1) That the alleged transferee received property of the
transferor; (2) that the transfer was made without adequate
consideration or for less than adequate consideration; (3)
that the transfer was made during or after the period for
which the tax liability of the transferor accrued; (4) that
the transferor was insolvent prior to or because of the
transfer of property or that the transfer of property was
one of a series of distributions of property that resulted
in the insolvency of the transferor; (5) that all reasonable
efforts to collect from the transferor were made and that
further collection efforts would be futile; and (6) the
value of the transferred property (which determines the
limit of the transferee’s liability).

Gumm v. Commissioner, 93 T.C. 475, 480 (1989) (citations

omitted), affd. without published opinion 933 F.2d 1014 (9th Cir.

1991). The foregoing list of factors is a generalization of

equity principles under State law. Hagaman v. Commissioner,

supra at 184. However, as section 6901 does not enumerate such

factors, the existence and extent of liability must be determined

under State law. Id.

Typically, the principles relating to transferee liability

in equity in a given State will be codified in the State’s
 - 15 -

fraudulent conveyance law. Id. Both petitioner and the

bankruptcy estate trustee reside in the State of Ohio. See Ohio

Rev. Code Ann. secs. 1336.01-1336.11 (LexisNexis 2006).

Accordingly, we analyze whether petitioner may be held liable,

pursuant to Ohio law, as a transferee of the bankruptcy estate

for the bankruptcy estate’s 2001 assessed income tax liability

and related additions to tax.

Ohio has adopted the Uniform Fraudulent Transfer Act (UFTA),

which provides as follows:

A transfer made or an obligation incurred by a debtor is
fraudulent as to a creditor whose claim arose before the
transfer was made or the obligation was incurred if the
debtor made the transfer or incurred the obligation without
receiving a reasonably equivalent value in exchange for the
transfer or obligation and the debtor was insolvent at that
time or the debtor became insolvent as a result of the
transfer or obligation.

Ohio Rev. Code Ann. sec. 1336.05(A). Ohio Revised Code section

1336.07(A) allows a creditor to collect the assets from the

transferee if a transfer is fraudulent under Ohio Revised Code

section 1336.05. Consequently, if the bankruptcy estate’s

transfer of funds to petitioner was fraudulent under Ohio Revised

Code section 1336.05, respondent is entitled to collect the

bankruptcy estate’s deficiency and additions to tax from

petitioner pursuant to section 6901.

The bankruptcy estate transferred to petitioner, for no

consideration, an initial cash disbursement of $200,000 on June

18, 2002, and a final cash disbursement of $53,935 on October 3,
 - 16 -

2003. As noted above, the bankruptcy estate’s tax liability

regarding the Wal-Mart suit was a preexisting debt that was due

and owing to respondent at the close of the bankruptcy estate’s

2001 tax year. See Hagaman v. Commissioner, 100 T.C. at 185.

The bankruptcy estate became insolvent as a result of the

June 18, 2002, distribution to petitioner. A party is insolvent

once its liabilities exceed its assets. Ohio Rev. Code Ann. sec.

1336.02(A)(1). In addition to the $60,741 owed to the

outstanding named creditors and the $18,629 owed to Mr. Gertz as

compensation for his role as trustee, the bankruptcy estate owed

$118,310 in Federal income tax, for total liabilities of

$197,680.8 Following the June 18, 2002, distribution to

petitioner, the bankruptcy estate’s then-existing liabilities of

$197,680 exceeded its then-existing assets of $133,014.

Petitioner argues that she has done nothing wrong. However,

the intent of the parties is not controlling. See Ohio Rev. Code

Ann. sec. 1336.05(A); Comer v. Calim, 716 N.E.2d 245, 250 (Ohio

Ct. App. 1998) (fraudulent conveyance may be set aside regardless

of the motives of the parties). As to petitioner’s contention

8
The bankruptcy estate would have been insolvent if either
the tax liability of $116,824 from the Dec. 16, 2005, notice of
deficiency or of $160,731 shown due on the 2001 Form 1041 filed
by the bankruptcy estate had been used to calculate total
liabilities.

This calculation excludes additions to tax which would have
accrued when the tax return went unfiled and the tax liability
went unpaid. See secs. 6651(a)(1) and (2), 6654.
 - 17 -

that respondent has not exhausted all reasonable efforts to

collect the tax liability from the bankruptcy estate, we note the

proceedings in the District Court and the recently concluded

proceedings in the bankruptcy court. However, the Ohio UFTA does

not require a creditor to prove that it exercised all reasonable

efforts to collect the liability from the transferor before

proceeding against the transferee. See Ohio Rev. Code Ann. secs.

1336.01-1336.11.

Accordingly, we conclude that the distributions of cash from

the bankruptcy estate to petitioner during June 2002 and October

2003 were fraudulent transfers under Ohio law.9

Generally, a taxpayer may challenge the underlying tax

liability of the transferor. Sec. 6901(a) (underlying tax

liability shall be “assessed, paid, and collected in the same

manner and subject to the same provisions and limitations as in

the case of the taxes with respect to which the liabilities were

incurred”); see also United States v. Williams, 514 U.S. 527, 539

(1995) (“certain transferees may litigate the tax liabilities of

the transferor; if the transfer qualifies as a fraudulent

conveyance under state law, the Code treats the transferee as the

taxpayer”); L.V. Castle Inv. Group, Inc. v. Commissioner, 465

9
Because we conclude that the transfers were fraudulent
under the Ohio UFTA, we need not address additional Ohio
equitable principles or the factors described in Gumm v.
Commissioner, 93 T.C. 475 (1989), affd. without published opinion
933 F.2d 1014 (9th Cir. 1991).
 - 18 -

F.3d 1243, 1248 (11th Cir. 2006) (“transferee is ‘free to

litigate the[ ] transferor’s liability’ after it receives a

notice of transferee liability”) (quoting Great Falls Bonding

Agency, Inc. v. Commissioner, 63 T.C. 304, 307 (1974)). However,

if the transferor’s tax liability is subject to a closing

agreement or if res judicata applies, the transferee may not

litigate the transferor’s underlying liability. Pert v.

Commissioner, 105 T.C. 370, 377 (1995); Krueger v. Commissioner,

48 T.C. 824, 830-832 (1967). Petitioner has not contested the

assessments against the bankruptcy estate, and she failed to make

any such arguments. Accordingly, we deem conceded any issue

regarding the transferor’s underlying liability.

The value of the funds transferred in the distributions to

petitioner ($253,935) is greater than the amount respondent

sought in the notice of transferee liability ($179,910).10

Accordingly, we hold that petitioner is liable as a

transferee of the bankruptcy estate for its 2001 tax year

pursuant to section 6901 for the bankruptcy estate’s assessed

income tax liability of $118,310, the addition to tax pursuant to

section 6651(a)(1) of $26,620, the addition to tax pursuant to

10
As the $179,910 liability does not include interest or
account for the disgorged trustee’s fees paid to respondent,
$253,934 represents the upper limit of petitioner’s liability.
See Gumm v. Commissioner, supra at 480; Stokes v. Commissioner,
22 T.C. 415, 428 (1954).
 - 19 -

section 6651(a)(2) of $29,578, and the addition to tax pursuant

to section 6654 of $4,682.

The Court has considered all other arguments made by the

parties, and to the extent we have not addressed them herein, we

consider them moot, irrelevant, or without merit.

On the basis of the foregoing,

Decision will be entered

for respondent.