Frank and Barbara Biehl - Page 6

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          31, 1997, and continue for 143 months until December 31, 2008.              
          The defendants were required to pay petitioners $13,321 each                
          month, which included interest at the rate of 8-1/2 percent per             
          year, calculated from December 31, 1996.  If the defendants                 
          failed to comply with the stipulation, judgment would be entered            
          in favor of petitioners for the unpaid balance of the purchase              
          price, with interest, and petitioners’ reasonable attorney’s                
               NCMI issued a Form 1099 to Mr. Biehl showing $1.2 million              
          paid to him in 1996.  On October 16, 1997, petitioners filed a              
          motion in Santa Clara County Superior Court to enforce the                  
          settlement agreement.  Petitioners alleged that NCMI violated the           
          settlement agreement by issuing one Form 1099 to Mr. Biehl for              
          $1.2 million, rather than two Forms 1099, one to Mr. Biehl for              
          $799,000 and one to Olimpia, Whelan,& Lively for $401,000.                  
          Petitioners’ motion to enforce the settlement agreement states              
          that the income tax consequences of the settlement were a major             
          concern to Mr. Biehl in the settlement negotiations, and that he            
          had been satisfied with the settlement agreement because it                 
          required NCMI to pay the attorney’s fee directly to Olimpia,                
          Whelan, & Lively.  Mr. Biehl’s stated concern was that if NCMI              
          issued a single Form 1099, he would have to include $1.2 million            
          as his income from the settlement, versus $799,000 had NCMI                 
          issued two Forms 1099.  According to the motion, the tax                    

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