In Uncategorized on 07/29/2015 at 15:31

Is the key to deciding whether a proposed amendment to a pleading is an ambush.

On a slow day in Tax Court (no opinions, no really toothsome orders), STJ Lewis (“The Name”) Carluzzo has a designated hitter, Jeremy Edwin Porter & Ruth Ann Porter, Docket No. 16966-14, filed 7/29/15.

The Porters object to IRS’s amending its answer out of time, to allege Section 6663 fraud chops. That’s the 75% solution, and it can really sting.

IRS needs leave of court, of course, because more than thirty days have gone by since the last pleading.

But the liberals (not the political ones) have it.

“In general, after a responsive pleading has been served, or if after 30 days no responsive pleading is permitted, ‘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.’ Rule 41(a). That Rule reflects ‘a liberal attitude toward amendment of pleadings.’ 60 T.C. 1089 (explanatory note accompanying promulgation of Rule 41). Petitioners have not consented to the amendment.” Order, at p. 1.

Judge, I don’t know that I would consent, either.

But the case hasn’t been set for trial, and the Porters don’t show unfair surprise, disadvantage or prejudice. So it seems they have time to prepare a defense to IRS’s attempt to show the clear and convincing evidence necessary to sustain the fraud chops.

And that seems to be the test.

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