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limited partnerships totaling $120,000 payable to Newtowne.
Petitioner caused the checks to bear a notation indicating that
payment was for warranty and/or market research fees. The
partnerships did not owe Newtowne any amounts for warranty and/or
market research fees in 1982. The checks were endorsed to the
Huntington Mortgage Co. and deposited into an account entitled
"Newtowne III" at Huntington Bank. These checks represent the
amounts referred to above as syndication and consulting fees.
Huntington Bank issued a loan commitment letter to petitioner
setting forth the provisions of loans in the amount of $320,000
for the purchase of the two office buildings.
(c) Construction of Petitioner's Home and Architectural
Services
As a condition to signing one of the contracts between a
partnership that petitioner controlled and Newtowne, petitioner
approached Riat with the prospect of swapping petitioner's home
for Riat's home. Instead of swapping homes, Riat suggested that
he design and build, with Newtowne, a 10,000-square-foot home for
petitioner. The parties entered into a contract to build the
home in November 1983, and construction began shortly thereafter.
On February 28, 1985, Newtowne and petitioner entered into a
separation agreement. The construction of the home was not
completed at the time Newtowne entered into the separation
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