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Mr. Peters’s estimated fair market values were not from reliable
or verifiable sources. Respondent also points out that Mr.
Peters’s study contained discounts for fractional interests that
varied from 29 percent to 83 percent. To the extent that
subsequent sales were used to determine the amount of discount,
respondent indicates that neither Mr. Young nor Mr. Peters
adjusted (reduced) the fair market value to reflect any
intervening inflation.
Finally, respondent points out that Messrs. Young and Peters
both used the Pennzoil sale as a comparable but used differing
data and arrived at differing discounts. Mr. Peters arrived at
an average 36-percent discount using a fair market value of
almost $474,000, whereas Mr. Young had discounts ranging from
14.10 percent to 62.06 percent using a fair market value of
$420,000. These discrepancies, respondent contends, reflect a
lack of credibility in the experts’ reports.
C. James Steele III
The estates’ third expert has engaged for more than 20 years
in the business of buying and selling rural Louisiana farm and
timberland with concentration on undivided interests in
relatively small (1,000 acres or less) parcels. Mr. Steele’s
entity was the purchaser in the Pennzoil transaction relied on by
both Messrs. Young and Peters.
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