- 9 - construct the improvements.5 But that is contradicted by petitioner's alleged journal on the Montrose property showing that moneys were not spent in any amounts until after August 1, 1985.6 We are faced, therefore, with inconsistencies not only in petitioner's testimony but also between his testimony and the documents. These are not the only weaknesses in the alleged Welch/Zurn financial relationship. There are no indicia of a normal debtor/creditor relationship supporting petitioner's version of the facts. There were no notes, no due dates or payment schedules, and no stated rate of interest.7 Indeed, at the trial, while both petitioner and Mr. Zurn testified that 5 We have tried in vain to correlate the checks from Mr. Zurn that were deposited in the Montrose property account with the expenditures listed on the alleged journal on the Montrose property. 6 Respondent objects to Exhibit 44AR, which was offered as a record of Mr. Zurn's advances to the Montrose property. The only reference that may be to Mr. Zurn is an ambiguous notation on page 2 of Exhibit 44AR that reads "$202.31 - 18 Dec. - 15 shts 3/4 CDX Grossman's - pd by Stan Zurn". We do not accept that this was a contemporaneous record of funds allegedly borrowed by petitioner. We do admit the exhibit as a record created by petitioner, but we have little confidence in the document as being a record of loans from Mr. Zurn to petitioner. 7 Petitioner argues that the interest rate at the beginning was 6 percent and then was changed to 17.136 percent, as evidenced by a notation on the alleged journal on the Montrose property. The reference in the journal reads "Feb. 21, 85 to B.W. 17.136%." Whatever this may refer to, we do not believe that it relates to the interest that petitioner was expected to pay. We note further that petitioner did not claim any deduction for interest on his 1986 tax return.Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
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