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Processing & Sales Co. v. United States, supra; Litton Bus. Sys.,
Inc. v. Commissioner, supra at 377.
Although we do not find that the parties created a formal
"debt instrument", we do find that the parties have evidenced an
objective expression of their intent to create a debt. See
Litton Bus. Sys., Inc. v. Commissioner, supra at 377. The
absence of formal notes does not preclude the court from treating
other written documentation as evidence of a bona fide debt.
Baird v. Commissioner, supra at 395; see Fin Hay Realty Co. v.
United States, 398 F.2d 694, 697 (3d Cir. 1968). In Litton Bus.
Sys., Inc. v. Commissioner, supra, the Court found that a board
of directors' resolution directing that an advance account be
established as a debt obligation was sufficient to indicate
indebtedness between related parties. The memorandum contained
statements reflecting "borrowing from the stockbroker" by "using
trust assets as collateral" and was followed by a transfer of the
borrowed funds from the trusts to the estate. The journal entries
indicate the transfers of mortgages from the estate to the trusts
in "partial debt settlement". We find that these writings show
the presence of a valid debt and may be considered jointly to be
objective evidence of indebtedness.
b. Security, Interest Payments, or Fixed Repayment Date
The parties have stipulated that there was no repayment
schedule and no fixed maturity date with respect to the debt.
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