- 28 -
interest, and then applying a rate of return he felt a
knowledgeable investor would require.
Clubside’s only significant asset as of the valuation date
was the Cathead property. Mr. Bishop and Mr. Mitchell both
relied on the Carbonell and Tarnow report which valued the entire
Cathead property at $3,147,092 as of December 30, 1992, of which
$870,000 was attributed to the house owned by decedent and Mr.
Hoffman. Mr. Bishop determined that the fair market value of the
Cathead property owned by Clubside was $2,547,09221 as of August
18, 1994, while Mr. Mitchell determined that the fair market
value of the property as of that date was $2,685,057.22
The liabilities of Clubside as of the valuation date
consisted of accounts payable of $499 and the following
promissory notes payable:
Note Payable Amount Interest Rate Maturity Date
Melissa Hoffman Trust $24,000 7.61% 1/01/2012
Matthew Hoffman Trust 24,000 7.61% 1/01/2012
Elisabeth Hoffman Trust 24,000 7.61% 1/01/2012
Hoffman Associates 278,147 7.61% 1/01/2012
Marcia Hoffman 173,063 7.61% 1/01/2012
Al Hoffman, Jr. 189,053 7.61% 1/01/2012
Melissa Hoffman 62,333 7.61% 1/01/2012
21Mr. Bishop reached his determination by subtracting the
value of the house owned by decedent and Mr. Hoffman from the
value of the entire Cathead property.
22Mr. Mitchell reached his determination by making certain
adjustments to the figures determined in the Carbonell and Tarnow
report. Specifically, he adjusted the value of the property
upward to account for its present value and then subtracted the
present value of the house, commissions costs, holding costs, and
road improvement costs.
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