- 6 -
Steinman). Also on May 2, 1990, petitioners deposited the
$200,000 into an account at Wells Fargo Bank held in the name
“Huntington Harbour Bay and Racquet Club Marina Acct”. The
balance in this account immediately before the deposit was
$35,214.02. On the same day, petitioners wrote a check from this
account for $200,000 to purchase a certificate of deposit.4
Petitioners did not report the $500,000 received in 1989 and
the $200,000 received in 1990 from Escrow Holder as income on
their 1989 or 1990 tax return or on any subsequent returns.
Public Trust Land Problem
In April 1990, local Huntington Beach residents sued CDC and
the City of Huntington Beach with respect to CDC’s planned
condominium development at the Huntington Harbour Bay Club Phase
I. The lawsuit challenged, inter alia, the legality of “land use
approvals” made by the City of Huntington Beach under the
“General Plan” with respect to a zoning variance for Phase I of
the project. The residents also contended that height
restrictions were violated and that the project did not promote
the general welfare of the neighborhood.
In a letter dated May 11, 1990, the attorney representing
the residents wrote a letter to the deputy city attorney for
Huntington Beach and the executive director of the California
4 The record contains substantial additional evidence
tracing petitioners’ use of the funds received from the Escrow
Holder. We believe that material is irrelevant to the issue.
Suffice it to say that petitioners exercised dominion and control
over these funds without restriction.
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Next
Last modified: May 25, 2011