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explanation of the joint ownership arrangement between the
sisters, their split of investment income and expenses and
reporting of 50 percent of said income and expenses on each of
their returns was accepted by the Internal Revenue Service (IRS).
Elizabeth died on December 2, 1979. Gordon Davenport and
Patricia Vestal were appointed the coexecutors of Elizabeth's
estate. Charles Botefuhr also was appointed a coexecutor of the
estate of Elizabeth Davenport. Mr. Botefuhr resigned as a
coexecutor of Elizabeth's estate in September, 1980, over a
dispute on how to report assets titled in Elizabeth's name.
The estate of Elizabeth Davenport filed Federal and State
estate tax returns which included one-half of the value of the
stocks and bonds, the legal title to which was held in
Elizabeth's name at the time of her death, in Elizabeth's gross
estate. These stocks included 1,610 shares of Hondo stock,
valued at $804 per share. The remaining one-half of the stock of
Hondo was considered by the coexecutors of Elizabeth's estate to
be Birnie's property pursuant to the sisters' oral agreement.
The Federal estate tax return for the Estate of Elizabeth
Davenport was prepared by Ms. Childs and was signed and filed by
Patricia Vestal and Gordon Davenport. The estate tax return for
the Estate of Elizabeth Davenport was examined by the IRS. The
IRS took the position that the entire value of all assets held in
Elizabeth's name should be included in her gross estate, and that
the 3,220 shares of Hondo stock should be valued at $3,019 per
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