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Grothues and Mr. Kanz contemplated the simultaneous execution of
the settlement upon which the agreed judgment was entered and the
collateral agreement. These facts indicate that at the time Mr.
Kanz admitted the theft, he knew that he would not be liable to
pay the judgment.
Also, Mr. Kanz’s admissions are a moving feast of
inconsistencies. From 1993 to 1995, Mr. Kanz denied he
misappropriated any funds. In January 2002, Mr. Kanz admitted to
misappropriating some of the money but not as much as stated in
the agreed judgment. Then in February 2002, Mr. Kanz admitted
all the findings in the agreed judgment. These inconsistencies
undermine the credibility of Mr. Kanz’s admissions.
Even though Mr. Kanz has not helped petitioners solve their
tax problems, petitioners have not filed a claim for breach of
contract by Mr. Kanz in order to collect on the judgment. These
are all acts a reasonable person might do in efforts to recover
stolen property from a thief. Although it is improbable Mr. Kanz
would admit to an act which would lead to civil liability, his
friendship with petitioners and his belief that the collateral
agreement protected him from collection suggest he made his
admissions in an effort to help petitioners with their tax
problems. His admissions do not prove theft occurred.
13(...continued)
the collateral agreement was executed at the time of the agreed
judgment.
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