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The FDIC further counters that Rodriguez`s arguments are contrary to the basic rules of agency law and contract interpretation. Letter to the respondent, at age 44. First, the FDIC notes that while the labels do not determine whether an agency relationship exists — because an agency relationship can exist without the parties referring to it as such — Rodriguez failed to cite a Colorado case that “refused to allow the parties to describe their relationship as one of the agencies.” Id. pp. 44-45. In addition, the FDIC argues that the bank and other subsidiaries have control of UWBI on the basis of UWBI`s “self-performing” obligations under the agreement. Id. pp. 45-46. According to the FDIC, the agreement entitles subsidiaries to tax refunds that they would have received if they had been filed separately, and UWBI must pay those refunds to the subsidiaries. The FDIC also asserts that UWBI`s status as a parent company is irrelevant because each affiliate had to decide independently whether or not to join the agreement. Id.
pp. 46-47. Finally, the FDIC asserts that even if a court finds that the agreement does not establish an agency relationship under Colorado law, Colorado law does not require that UWBI be endowed with a fair right to a tax refund. Id. at p. 47. On the contrary, according to the FDIC, that finding is based on the intention of the parties in forming the agreement, which, as the agreement`s reference to UWBI as an `agent` shows, indicates that the parties did not intend to acquire equitable title. Id. at p. 48. Whether the courts should determine ownership of a tax refund paid to a related group based on the federal Bob Richards Rule law, as three counties apply, or on the basis of the law of the state in question, how four counties hold.
Excluded from the RMT are taxpayers who fall within the scope of Law No. 27037, the Law on the Promotion of Investment in the Amazon Region and complementary and amending regulations; Law No. 27360, Law approving standards for the promotion of the agricultural sector and amending standards; Law No. 29482, Law on the Promotion of Productive Activities in the Regions of the High Andes; Law No. 27688, Law on tacna Free Zone and Commercial Zone and amending regulations such as Law No. 30446, Law Establishing the Complementary Legal Framework for Special Development Zones, Free Zone and Tacna Commercial Zone; and regulatory and amending standards. The FDIC, on the other hand, notes that, according to Bob Richards` court, allowing a parent company to obtain fair title in a tax refund generated exclusively by a subsidiary solely on the basis of the procedural instrument of a consolidated tax return would unfairly enrich the parent company. Letter to 29-year-old respondents. However, the FDIC asserts that, regardless of the negative impact of Bob Richards` standard rule on the final right to a tax refund, these effects can be mitigated by clear contracts.
See id. at 29-30. The FDIC further asserts that the value of requiring a parent company to file and receive tax refunds on behalf of a single consolidated group is that the IRS can efficiently process consolidated tax returns without accidentally changing ownership of refunds within a group. Id. at p. 32. As the FDIC submits, that requirement was not intended to confer on the parent company any particular advantages over the members of the related group which it represents. Id. at p. 37.
Instead, the FDIC argues that if parties to a consolidated deposit group want to give a parent company equitable ownership of the tax refunds paid by the IRS, that intention is better fulfilled contractually. See id. at p. 38. According to Rodriguez, there is no legal or regulatory authority that supports the Bob Richards Rule; Thus, the only possible legal basis for the rule is federal customary law. Letter to the petitioner, Simon E. Rodriguez (“Rodriguez”) at the age of 24. However, Rodriguez claims that the Bob Richards Rule is not a valid exercise of federal legislative power in federal courts. Rodriguez explains that federal courts can only create customary federal law if three conditions are met: first, there must be a “single federal interest”; Second, Congress must not have adopted a comprehensive regulatory system that regulates the matter, or given a federal agency regulatory power; And third, the use of state law to solve the problem must be in “significant conflict” with federal policy.
Id. at p. 26. Rodriguez submits that none of those conditions are met with respect to consolidated tax returns and that, therefore, the creation of the Bob Richards Rule was marred by irregularities. Id. Rodriguez argues that once the Bob Richards rule is found invalid, the only way the FDIC can have a fair right to the refund is for UWBI to hold the refund as the bank`s representative under applicable state law — in this case, Colorado law. Letter to the respondent at 51-52. According to Rodriguez, an agency relationship exists under Colorado law if (1) the agent agrees to act on behalf of the principal and (2) the principal controls the agent. Id.
at 52. Rodriguez argues that there is no agency relationship here because the bank had no control over UWBI, as the agreement shows. Id. at p. 53. In particular, Rodriguez points out that, under the agreement, UWBI had a wide discretion to process the group`s tax return and that the bank did not have the power to order UWBI or revoke the agreement. In fact, Rodriguez said, UWBI actually had control of the bank by being the bank`s parent company. In addition, Rodriguez argues that the agreement`s use of the terms “agent” and “intermediary” are merely “bare labels” that are not sufficient to create an agency relationship under Colorado law. Id. bei 55. Rodriguez therefore concludes that UWBI is clearly not a representative of the bank and therefore has a legal and appropriate right to a tax refund.
Id. at 55-56. On September 16, 2016, the Bankruptcy Court issued a summary judgment in Rodriguez`s favor. The bankruptcy court found that UWBI`s bankruptcy estate had “mere legal title” to the tax refund, that the FDIC had failed to establish equitable ownership of the bank, and that the agreement clearly established a creditor-debtor relationship between UWBI and the bank, not an agent-principal relationship. Id. at 9-10. The FDIC then appealed to the U.S. District Court for the District of Colorado (the “District Court”), which overturned the bankruptcy court`s decision and concluded that the agreement was ambiguous with respect to UWBI and the bank`s relationship.
