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client. As will subsequently appear, however, there are serious
questions as to the extent to which the negotiations adequately
took into account certain financial aspects of the transaction
which may cause the negotiations and the resulting sale price to
be categorized as not being at arm's length and therefore giving
rise to inurement. Among the elements involved are consideration
or lack of consideration given to the changes in values of items
reflected in petitioner's balance sheet between September 30,
1981, and May 8, 1983, the proper valuations of the Belcher Road
and County Road #77 parcels, the measure of petitioner's
obligations under its pension plan, the value, if any, of the
certificate of need for 31 additional beds, and the impact of
changes in methods of reimbursement in respect of Medicare
reimbursements and of the sales of the hospital in 1985 and 1990.
These elements bear directly on the determination of the range of
fair market values and consequent inurement, if any.
An element in resolving the question of fair market value,
and therefore inurement, is the extent to which evidence as to
events and actions occurring after the date of the 1983 sale can
be taken into account. Petitioner has raised a number of
objections to such evidence, particularly the evidence relating
to the 1985 sale of the property and the circumstances
surrounding such sale, on the ground of relevancy.
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