                         T.C. Memo. 2000-64



                       UNITED STATES TAX COURT



     SCENIC WONDERS GALLERY, LLC, PHOTO ART MARKETING TRUST,
                TAX MATTERS PARTNER, Petitioner v.
           COMMISSIONER OF INTERNAL REVENUE, Respondent



     Docket No. 20509-98.                 Filed February 29, 2000.



     John P. Wilde, for petitioner.

     David W. Otto and Doreen M. Susi, for respondent.



                         MEMORANDUM OPINION


     CHIECHI, Judge:    This case is before the Court on respon-

dent's motion to dismiss for lack of jurisdiction (respondent’s

motion).   We shall grant respondent’s motion.
                               - 2 -


                            Background

     For purposes of respondent’s motion, the parties do not

dispute the following factual allegations that are part of the

record.   At all relevant times, Scenic Wonders Gallery, LLC

(Scenic Wonders) was a limited liability company that is taxed as

a partnership because it did not make an election to be taxed as

a corporation.   Scenic Wonders filed partnership income tax

returns, Forms 1065 (returns), for taxable years 1995 and 1996.

In those returns, it was indicated that there were two part-

ners/members of Scenic Wonders, i.e., Photo Art Publishing Trust

and Photo Art Marketing Ent.   Consequently, the provisions of

sections 6221 through 6234 apply.1

     Respondent issued a Notice of Final Partnership Administra-

tive Adjustment which was addressed as follows:

     TAX MATTERS PARTNER
     SCENIC WONDERS GALLERY LLC
     PHOTO ART MARKETING ENTERPRISES
     320 N 89A 14
     SEDONA, AZ 86336

     John P. Wilde (Mr. Wilde) timely mailed to the Court a

petition purportedly filed on behalf of Scenic Wonders.   Mr.

Wilde identified himself in the petition as co-trustee of Photo

Art Marketing Trust.   Mr. Wilde further represented in the



     1
      All section references are to the Internal Revenue Code in
effect for the years at issue. All Rule references are to the
Tax Court Rules of Practice and Procedure.
                              - 3 -


petition that Photo Art Marketing Trust is the tax matters

partner (TMP) for Scenic Wonders.   Photo Art Marketing Trust was

formed under the laws of the State of Arizona.

     Upon commencement of the examination of the returns filed by

Scenic Wonders for taxable years 1995 and 1996, respondent

requested complete copies of the trust documents relating to

Photo Art Marketing Trust, the purported TMP for Scenic Wonders,

documentation regarding those returns, the nature of the business

of Scenic Wonders, and the relationship of Scenic Wonders to its

alleged owners, as well as other items of substantiation.

Neither the trust documents nor the other documents and informa-

tion requested was provided to respondent.

     Respondent’s motion contends in pertinent part:

          15. * * * all of respondent’s records regarding
     the TMP trust [Photo Art Marketing Trust] indicate an
     entity named D & E Sword Company is the trustee. These
     records are based upon representations made by the TMP
     trust to respondent in correspondence, and in represen-
     tations made by the TMP trust in its petition with this
     Court in a related docketed case (Docket No. 16506-98).


          16. Respondent’s counsel contacted the Arizona
     Corporation Commission to determine the existence/
     validity of the entity called D & E Sword Company. The
     Corporation Commission informed respondent’s counsel
     that it had no record of any entity by that name ever
     existing in the State of Arizona. Further, the Corpo-
     ration Commission informed respondent’s counsel that it
     had no record of any entity incorporated in Arizona
     under the name of, or in reference to, an individual
     named John P. Wilde.
                              - 4 -


          17. There is absolutely no evidence from which
     the Court can adduce that there has been a legal as-
     signment of John P. Wilde as the Co-Trustee of the TMP
     Trust.

          18. Petitioner has provided no evidence that Mr.
     Wilde’s appointment as Co-Trustee is valid or autho-
     rized under the terms of the TMP trust indenture (as-
     suming one exists).

        *       *       *       *       *        *       *

          20. * * * petitioner has failed to demonstrate
     that John P. Wilde was legally appointed as Co-Trustee
     authorized to act on behalf of the TMP trust and bring
     the instant case before this Court. See T.C. Rule
     60(c).

     Petitioner filed an objection to respondent’s motion in

which it asks the Court to deny that motion.   That objection

asserts in pertinent part:

          3. The Respondent’s objection goes to the manage-
     ment of the Trust, its internal affairs, concerns about
     its administration, the declaration of rights and the
     determinations of matters involving the trustee. As
     the Respondent concedes that these [sic] are “Arizona
     Trusts” [sic] * * *, this issue falls within the exclu-
     sive jurisdiction of the superior court here in the
     State of Arizona. See A.R.S. § 14-7201. At this
     point, this court is without jurisdiction to determine
     whether * * * [Mr. Wilde] is the duly authorized
     Trustee. The Petitioner need not remind the Court of
     the consequences of taking any action over which sub-
     ject matter is completely lacking.

          4. Any objection the Respondent or Respondent’s
     counsel has in this area must be taken up in the Supe-
     rior Court here in Arizona, assuming of course the
     Respondent or Respondent’s counsel has standing. The
     irony is of course, if Respondent or Respondent’s
     counsel does take the matter up with the Superior
     Court, where the Respondent will have the burden of
     proof, and if the Superior Court finds that the Trusts
     are valid, then the Respondent will be barred by res
                              - 5 -


     judicata from asserting the sham trust claim that forms
     the basis for his deficiency determination.

          5. * * * In essence the factual claims raised by
     the Motion to Dismiss are inextricably intertwined with
     the facts going to the merits of the Commissioner’s
     sham trust claim at issue in this case. If the Trusts
     [sic] are valid, then Mr. * * * [Wilde], under Arizona
     Law, will be presumed to be the duly authorized
     trustee, whether it is as a Trustee of a resulting
     trust, constructive trust or expressed [sic] trust.
     Therefore, the only course available to this Court is
     to defer consideration of the jurisdictional claims to
     the trial on the merits. Farr v. United States, 990
     F.2d 451, * * * [454] n.1 (9th Cir., 1993). Careau
     Group v. United Farm Workers [of Am.], 940 F.2d 1291,
     1293 (9th Cir. 1991). See also Rosales v. United
     States, 824 F.2d 799, 803 (9th Cir. 1987) (“A * * *
     [district] court may hear evidence and make findings of
     fact necessary to rule on the subject matter jurisdic-
     tion question prior to trial, if the jurisdictional
     facts are not intertwined with the merits.”)(Emphasis
     added)

     The Court held a hearing on respondent’s motion.   At that

hearing, Mr. Wilde appeared as trustee for Photo Art Marketing

Trust, the purported TMP of Scenic Wonders.2   Petitioner prof-

fered no evidence, and the parties presented no new arguments, at

that hearing.

                           Discussion

     Rule 60 provides in pertinent part:

          (c) Capacity: * * * The capacity of a fiduciary
     or other representative to litigate in the Court shall


     2
      At the hearing, the Court informed Mr. Wilde that its
allowing him to appear at the hearing as the alleged trustee of
Photo Art Marketing Trust did not mean that the Court agreed that
he in fact was a duly appointed and authorized trustee of that
entity.
                               - 6 -


     be determined in accordance with the law of the juris-
     diction from which such person's authority is derived.

     The parties do not dispute that Photo Art Marketing Trust,

the purported TMP of Scenic Wonders, is a trust organized under

the laws of the State of Arizona.   Under Arizona law, see Rule

60(c), a trustee has the power to commence litigation on behalf

of a trust.   See Ariz. Rev. Stat. Ann. sec. 14-7233.C.25. (West

1995).   In the instant case, petitioner has the burden of proving

that this Court has jurisdiction, see Fehrs v. Commissioner, 65

T.C. 346, 348 (1975); National Comm. to Secure Justice in the

Rosenberg Case v. Commissioner, 27 T.C. 837, 839 (1957), by

establishing affirmatively all facts giving rise to our jurisdic-

tion, see Wheeler's Peachtree Pharmacy, Inc. v. Commissioner, 35

T.C. 177, 180 (1960); Consolidated Cos., Inc. v. Commissioner, 15

B.T.A. 645, 651 (1929).   In order to meet that burden, petitioner

must provide evidence establishing that Mr. Wilde has authority

to act on behalf of Photo Art Marketing Trust, the purported TMP

of Scenic Wonders.   See National Comm. to Secure Justice in the

Rosenberg Case v. Commissioner, supra at 839-840; Coca-Cola

Bottling Co. v. Commissioner, 22 B.T.A. 686, 700 (1931).   We

reject petitioner's position that under Arizona law the validity

of the purported appointment of Mr. Wilde as a trustee of Photo

Art Marketing Trust falls within the exclusive jurisdiction of

the courts of the State of Arizona.
                                 - 7 -


     On the record before us, we find that petitioner has failed

to establish that Mr. Wilde is authorized to act on behalf of

Photo Art Marketing Trust, the purported TMP of Scenic Wonders.3

     To reflect the foregoing,

                                         An order of dismissal for lack

                                 of jurisdiction granting respon-

                                 dent’s motion will be entered.




     3
      We have considered all of the contentions and arguments of
petitioner that are not discussed herein, and we find them to be
without merit and/or irrelevant.
