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to call other witnesses, such as Haq or the notary public who
notarized both of the documents in question, or to offer any
other evidence to support their forgery theory. This failure
gives rise to the inference that the evidence, if produced, would
have been unfavorable to petitioners. See id.; see also Pollack
v. Commissioner, 47 T.C. 92, 108 (1966), affd. 392 F.2d 409 (5th
Cir. 1968); Wichita Terminal Elevator Co. v. Commissioner, 6 T.C.
1158, 1165 (1946), affd. 162 F.2d 513 (10th Cir. 1947); Stokes v.
Commissioner, T.C. Memo. 1999-204, and cases cited therein.
Accordingly, petitioners have failed to establish that their
signatures on the documents in question were not genuine.
Petitioners argue that they could not have sold the property
to Haq in April 1992, because they remained liable on the
mortgage until foreclosure in 1994. The record does not clearly
establish the factual premises of petitioners’ argument.5
Assuming, arguendo, that petitioners’ factual premises are
correct, they do not compel the conclusion that petitioners would
have us draw. A mortgagor may sell the mortgaged property on
terms whereby the purchaser takes subject to the mortgage debt
but has no personal obligation to pay it. Osborne, Handbook on
the Law of Mortgages, sec. 248 (2d ed. 1970). As stated in
Stonecrest Corp. v. Commissioner, 24 T.C. 659, 666 (1955):
5 Petitioners introduced into evidence a notice to
foreclose, dated June 24, 1994, and a trustee’s deed of sale
dated Nov. 2, 1994. Neither document, however, specifically
describes the property to which these documents pertain, other
than by reference to Contra Costa County records that are not in
evidence and that are not otherwise explained.
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