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upr000093 129

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upr000093-129
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    Mr. W. H. Rouse 2. May 25, 1953 ily concerned with the removal of certain existing pipe lines and power lines. I think the sentence referred to as revised is consistent with the idea that the District is entitled to the balance of the Relocation Fund after all of the work provided in Section 5 has been complet­ed and paid for. 7. Page 27, line 25. Insert the word "or11 after "First Parties1'. 8. Page 29, line 12. Insert after the word "pro­rated" the words "in the escrow provided for in Section 7. 9. Page 46, line 23» Change the address to read "125 South 4th Street". 10. Exhibit "B", page 4, line 5. Insert after the word "Grantor11, aha hot' hereby conveyed". 11. Page 17a, line 9. We have not made any change with respect to the words "affiliated in ownership" ques­tioned by Mr. Bennewitz, who was concerned whether this required complete ownership. I do not believe that this expression would require complete ownership even under the Federal tax statutes,which are strict. Whether cor­porations are affiliated for tax purposes depends upon whether there is substantial ownership or control. D^Nunzio Fruit Co. v. Commissioner, 49 Fed, 2d, 41, 42. Although it Is impossible th know Just exactly how a court might interpret this language, I think the fact that the contract recognizes the right of the Union Pa­cific to serve the Pacific Fruit Express would aid in the practical construction of this phrase and limit it in meaning to an affiliation involving some substantial, but not total, ownership. I did not feel like asking the District to change this language because the District at­taches a good deal of importance to the restrictions upon the right of the Railroad to use water, and the language had been adopted after considerable discussion in our conferences. 1 do not believe that there will be many occasions which will involve the use of water by others than the parties to the agreement or the Pacific Fruit Express. E. E. Bennett ECRsMSB Via Air Mail