Leon L. Zachman and Estate of Ione Zachman - Page 3




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              Leon and Ione Zachman were married until her death in 1989.             
         Leon Zachman is the representative of the Estate of Ione Zachman.            
         Unless otherwise indicated, “petitioner” hereinafter refers to               
         Leon Zachman, and “petitioners” refers to Leon Zachman and Ione              
         Zachman.  Petitioner resided in Rogers, Minnesota, when the                  
         petition was filed.                                                          
              Petitioners have farmed in the Rogers area since 1949.                  
         Prior to 1983, petitioners’ farm was held in Shady Elms Farm, a              
         trust promoted by Lowell Anderson.2  On January 26, 1983,                    
         petitioners transferred their farm real property to another                  
         trust, Walnut Leaf.  In 1983, petitioner attended a meeting with             
         other farmers to hear a presentation by James Noske and Norb                 
         Stelton about utilizing business trusts.  On September 8, 1983,              
         petitioners executed bills of sale, purporting to transfer their             
         farm equipment and livestock to Hillside Farm.  On the same date,            
         in their capacities as trustees of Walnut Leaf, petitioners                  
         deeded their interests in the farm real property to Maplewood Co.            
         (Maplewood).  On October 4, 1983, petitioners executed a bill of             
         sale whereby for the stated consideration of “One dollar and                 
         other good and valuable consideration” they transferred to                   


               2 On Feb. 24, 1983, Lowell Anderson was indicted by a                  
          Federal grand jury in Wyoming for conspiring to defraud the                 
          United States by selling common-law trusts which were used to               
          evade Federal income taxes.  See United States v. Tranakos, 911             
          F.2d 1422, 1424 (10th Cir. 1990).  Lowell Anderson died while the           
          criminal proceedings were pending.  See id.                                 





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