Opinion ID: 72950
Heading Depth: 3
Heading Rank: 1

Heading: The Taxpayers

Text: The thrust of the taxpayers’ argument is that Judge Whitaker, from the bench at the close of trial, made oral findings of fact, especially relating to witness credibility and fraud, and those findings constitute the law of the case. Tax Ct. R. 152(a). They claim that, as Judge Whitaker heard the testimony of Zand and his witnesses, and observed first hand their demeanor on the witness stand, Judge Dawson committed 12 reversible error when he gave no due deference to Judge Whitaker’s findings. Taxpayers claim that, in rejecting these findings, Judge Dawson found them to be inappropriate statements, approaching injudicious or prejudicial. In this implicit rejection of the trial’s testimonial evidence, taxpayers assert that Judge Dawson also committed reversible error by deeming their witnesses not to be credible, not only as to the issue of fraud, but also as to issues concerning the deductibility of expenses, the earning of commission income, and the asserted negligence penalty. See Exxon Corp. v. United States, 931 F.2d 874, 878 (Fed. Cir. 1991)(a successor judge has no authority to amend his predecessor’s findings if they are dependent upon weighing conflicting testimony and evaluating witness credibility); Henry A. Knott Co. v. Chesapeake & Potomac Tel. Co., 772 F.2d 78, 85 (4th Cir. 1985)(deference should be given to the trier of fact as the person who sees the witness and hears the testimony); Toussaint v. Commissioner, 743 F.2d 309, 312 (5th Cir. 1984)(“[d]ue regard shall be given to the opportunity of the trial court to judge the credibility of the witnesses. . . .”). Taxpayers claim that Judge Dawson compounded this error when he drew negative inferences from various documents against Zand and his witnesses, all without regard to their trial testimony or Judge Whitaker’s view that their testimony was credible. 13 The taxpayers contend that they did not consent to the reassignment. Emerson Elec. Co. v. General Elec. Co., 846 F.2d 1324, 1326 (11th Cir. 1988). They claim that a close scrutiny of the record shows that Zand never declined an offer of a new trial. Once settlement discussions came to an end, the taxpayers argue that the Tax Court gave them no opportunity to request a new trial. They claim to be blind-sided by the court’s opinion finding that Zand waived his right to a retrial after the April 5, 1996, status conference and continue to dispute what transpired at the unrecorded status conference.