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this claim might be inflated, the record establishes that Renier
was open 68 hours per week. We do not believe that Kent’s sales
and management functions could be duplicated with a 40-hour work
week at $19.23 per hour, plus 20 percent in fringe benefits (or
total annual compensation of approximately $48,000), as Mr.
Sliwoski’s postulates. If one considers only Kent’s sales
function, his annual compensation would exceed $40,000,10 before
considering his multiple management and administrative duties.
In addition, Mr. Sliwoski failed to consider that except for the
last approximately 7 months of the base period, decedent also
actively assisted in Renier’s operation. We therefore do not
believe Mr. Sliwoski’s computations of reasonable compensation
for the sales and management functions performed by related
parties are reliable.
On this record, we have no alternative but to substitute our
best judgment of the value of the sales and management services
that were performed by Kent as of the valuation date (and various
other family members during the base period). Taking into
account the hours claimed in Kent’s testimony, it is our judgment
that the sales and management functions performed by him could be
accomplished in a 60-hour work week. Using Mr. Sliwoski’s
10 Respondent conceded that Kent was responsible for
approximately one-third of Renier’s annual sales of $1.5 million.
If Kent received a commission of 6 to 8 percent on those sales, a
commission which Mr. Sliwoski himself conceded was reasonable in
the business, plus benefits equal to 20 percent of this amount,
his compensation as a salesman would have exceeded $40,000.
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