                       T.C. Memo. 2001-113



                     UNITED STATES TAX COURT



                DYNADECK ROTARY SYSTEMS, LTD.,
     MARTIN LETTUNICH, TAX MATTERS PARTNER, Petitioner v.
         COMMISSIONER OF INTERNAL REVENUE, Respondent*



     Docket No. 1199-99.                       Filed May 10, 2001.




     Martin N. Lettunich, pro se.

     Paul K. Webb, for respondent.



                 SUPPLEMENTAL MEMORANDUM OPINION


     LARO, Judge: Martin Lettunich (petitioner), Tax Matters

Partner of Dynadeck Rotary Systems, Ltd. (the Partnership),

timely moves the Court to reconsider Dynadeck Rotary Sys. v.

     *
      This memorandum opinion supplements Dynadeck Rotary Sys. v.
Commissioner, T.C. Memo. 2000-382.
                               - 2 -


Commissioner, T.C. Memo. 2000-382.      See Rule 161, Tax Court Rules

of Practice and Procedure.   In Dynadeck Rotary Sys. v.

Commissioner, supra, the facts and holding of which are

incorporated herein by this reference, we sustained respondent’s

determination that the Partnership had no debt during 1991 and

1992 that would allow its partners to increase their bases in the

Partnership under section 752(a).    In so doing, we rejected

petitioner’s argument that $400,000 owed to the Laurel Assets

Group (LAG), an unrelated investment group, was a Partnership

debt that increased each partner’s basis in the Partnership for

those years.   Petitioner acknowledged that LAG transferred the

$400,000 directly to Dynadeck Rotary Systems Incorporated

(Corporation), a partner in the Partnership, and that the

underlying promissory note listed the Corporation as the obligor.

Petitioner asserted that the Corporation received the $400,000 as

the Partnership’s agent.   We stated:

     The facts of this case do not establish that the
     Partnership was ever liable to repay any of that [the
     $400,000] amount. The sole evidence that we find in
     the record as to a debtor/creditor relationship is the
     promissory note which provides clearly that the
     Corporation owed the money to LAG. The note says
     nothing, nor is there evidence, to support petitioner’s
     claim that the Corporation executed that note as the
     Partnership’s agent or that the Partnership was liable
     for the note’s repayment. Nor is there any evidence of
     a written agreement identifying the Corporation as the
     Partnership’s agent, or evidence that the Corporation
     was held out as the partnership’s agent in dealings
     with LAG or another third party. See Commissioner v.
     Bollinger, 485 U.S. 343, 349-350 (1988).
                               - 3 -


          Our conclusion is supported by the fact that the
     Corporation’s role in the Partnership was to secure
     funds for the Partnership and that the record is barren
     as to any obligation or effort on the part of the
     Partnership to secure its own funds. Nor do we find
     that any of the Partnership’s partners, except the
     Corporation, had such an obligation. In fact, each of
     the partners appears to have contributed something
     unique to the Partnership. In the case of Messrs.
     Schadeck and Lettunich, for example, the former
     contributed his rights in the underlying patent, and
     the latter contributed his legal skills and his labor.
     The Corporation expected to, and did, generate and
     contribute funds to the Partnership. [Id.]

     Reconsideration under Rule 161, Tax Court Rules of Practice

and Procedure, serves the limited purpose of correcting manifest

errors of fact or law, or allows for the introduction of newly

discovered evidence that could not have been introduced in the

prior proceeding by the exercise of due diligence.     See Estate of

Quick v. Commissioner, 110 T.C. 440, 441-442 (1998); Lucky

Stores, Inc., & Subs. v. Commissioner, T.C. Memo. 1997-70, affd.

153 F.3d 964 (9th Cir. 1998); Estate of Scanlan v. Commissioner,

T.C. Memo. 1996-414, affd. without published opinion 116 F.3d

1476 (5th Cir. 1997).   The granting of a motion for

reconsideration rests within our discretion, and we usually do

not exercise our discretion absent a showing of unusual

circumstances or substantial error.    See Estate of Quick v.

Commissioner, supra at 441-442; Lucky Stores, Inc., & Subs. v.

Commissioner, supra; Estate of Scanlan v. Commissioner, supra.

Reconsideration is not the appropriate forum for rehashing
                                - 4 -


previously rejected arguments or tendering new legal theories to

reach the end desired by the moving party.    See CWT Farms, Inc.

v. Commissioner, 79 T.C. 1054, 1057 (1982), affd. 755 F.2d 790

(11th Cir. 1985); Stoody v. Commissioner, 67 T.C. 643 (1977);

Estate of Trenchard    v. Commissioner, T.C. Memo. 1995-232.

     Petitioner's motion and related filings do not establish any

unusual circumstance or substantial error with respect to

Dynadeck Rotary Sys. v. Commissioner, supra.    Thus, petitioner is

not within the general rules for reconsideration of a Memorandum

Opinion.    Petitioner has also not persuaded us that the

Partnership’s case requires us to depart from these general

rules.    In his trial brief, petitioner argued that the

Corporation received the $400,000 as the Partnership’s agent.

For the reasons stated in Dynadeck Rotary Sys. v. Commissioner,

supra, we disagreed with that argument.    Petitioner now asks us

to reconsider and accept that argument.    We refuse to do so.

Petitioner has not presented any persuasive reason why we should

reconsider or change Dynadeck Rotary Sys. v. Commissioner,

supra.1    To the extent that petitioner had wanted either to


     1
       Petitioner’s motion relies, in part, on a document that
petitioner attached to his posttrial brief. The document is
entitled “Declaration of Martin N. Lettunich” and contains Mr.
Lettunich’s assertions as to his understanding of the events
surrounding the $400,000 debt. We did not and do not consider
that document (or the assertions stated therein) as evidence.
See Rule 143(b); see also Beecroft v. Commissioner, T.C. Memo.
                                                   (continued...)
                               - 5 -


strengthen his argument or to otherwise expand on it, he should

have done so before we released Dynadeck Rotary Sys. v.

Commissioner, supra.   Petitioner did not do so.

     Given the absence of a persuasive reason to depart from the

general rules for reconsideration mentioned above, we refuse to

reconsider Dynadeck Rotary Sys. v. Commissioner, supra.

Accordingly,

                                            An appropriate order will

                                       be issued denying petitioner's

                                       motion.




     1
      (...continued)
1997-23, and the cases cited therein.
