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Bankruptcy Court decreed that petitioner held a secured claim of
$18,913.02 against Ms. Marshall. Even though Ms. Marshall had
made no payments on the $38,000 loan, the Bankruptcy Court found
that, in the informal agreement between petitioner and Ms.
Marshall in their ownership of the subject properties, each party
was to make equal contributions of money and labor and that labor
provided by a coowner would be valued at $7 to $10 per hour. The
Bankruptcy Court found that Ms. Marshall had provided excess
labor to the properties that accounted for reduction of the
indebtedness from $38,000 to $18,913.02. In total, the
Bankruptcy Court decreed Ms. Marshall's indebtedness to
petitioner to be $33,875.97 based upon the following:
Loan on July 2, 1987 $38,000.00
Loan on July 17, 1990 10,000.00
Jan. through May 1990 mortgage payments 4,962.95
Total loans and advances (exclusive of interest) 52,962.95
Less credit on the $38,000 indebtedness (19,086.98)
Net indebtedness $33,875.97
The Bankruptcy Court ordered a sale of the properties owned by
Ms. Marshall, including the four properties in which petitioner
owned undivided interests. Of the net proceeds from the sale of
these properties, petitioner received $17,756 for his interests
in the properties. With respect to Ms. Marshall's interests in
the properties, $17,756 was turned over to the bankruptcy trustee
to be held for distribution to the creditors of the bankruptcy
estate. As of trial of this case, petitioner had not received
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